EXHIBIT 10.21
M.D.C. HOLDINGS, INC. 401(K) SAVINGS PLAN
ADOPTION AGREEMENT #005
NONSTANDARDIZED 401(k) PROFIT SHARING PLAN
The undersigned, M.D.C. Holdings, Inc. ("Employer"), by executing this
Adoption Agreement, elects to establish a retirement plan and trust ("Plan")
under the AMVESCAP National Trust Company (basic plan document # 01 ). The
Employer, subject to the Employer's Adoption Agreement elections, adopts fully
the Prototype Plan and Trust provisions. This Adoption Agreement, the basic plan
document and any attached appendices or addenda, constitute the Employer's
entire plan and trust document. All section references within this Adoption
Agreement are Adoption Agreement section references unless the Adoption
Agreement or the context indicate otherwise. All article references are basic
plan document and Adoption Agreement references as applicable. Numbers in
parenthesis which follow headings are references to basic plan document
sections. The Employer makes the following elections granted under the
corresponding provisions of the basic plan document.
ARTICLE I
DEFINITIONS
1. PLAN (1.21). The name of the Plan as adopted by the Employer is M.D.C.
Holdings, Inc. 401(k) Savings Plan.
2. TRUSTEE (1.33). The Trustee executing this Adoption Agreement is: (Choose one
of (a), (b) or (c))
[ ] (a) A DISCRETIONARY TRUSTEE. See Plan Section 10.03[A].
[X] (b) A NONDISCRETIONARY TRUSTEE. See Plan Section 10.03[B].
[ ] (c) A TRUSTEE UNDER A SEPARATE TRUST AGREEMENT. See Plan Section
10.03[G].
3. EMPLOYEE (1.11). The following Employees are not eligible to participate in
the Plan: (Choose (a) or one or more of (b) through (g) as applicable)
[ ] (a) NO EXCLUSIONS.
[X] (b) COLLECTIVE BARGAINING EMPLOYEES.
[X] (c) NONRESIDENT ALIENS.
[ ] (d) LEASED EMPLOYEES.
[ ] (e) RECLASSIFIED EMPLOYEES.
[ ] (f) CLASSIFICATIONS: ______.
[ ] (g) EXCLUSIONS BY TYPES OF CONTRIBUTIONS. The following
classification(s) of Employees are not eligible for the specified
contributions:
EMPLOYEE CLASSIFICATION: ______
CONTRIBUTION TYPE: ______
4. COMPENSATION (1.07). The Employer makes the following election(s) regarding
the definition of Compensation for purposes of the contribution allocation
formula under Article III: (Choose one of (a), (b) or (c))
[X] (a) W-2 WAGES INCREASED BY ELECTIVE CONTRIBUTIONS.
[ ] (b) CODE SECTION 3401(a) FEDERAL INCOME TAX WITHHOLDING WAGES INCREASED
BY ELECTIVE CONTRIBUTIONS.
[ ] (c) 415 COMPENSATION.
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[Note: Each of the Compensation definitions in (a), (b) and (c) includes
Elective Contributions. See Plan Section 1.07(D). To exclude Elective
Contributions, the Employer must elect (g).]
COMPENSATION TAKEN INTO ACCOUNT. For the Plan Year in which an Employee first
becomes a Participant, the Plan Administrator will determine the allocation of
Employer contributions (excluding deferral contributions) by taking into
account: (Choose one of (d) or (e))
[X] (d) PLAN YEAR. The Employee's Compensation for the entire Plan Year.
[ ] (e) COMPENSATION WHILE A PARTICIPANT. The Employee's Compensation only
for the portion of the Plan Year in which the Employee actually is a
Participant.
MODIFICATIONS TO COMPENSATION DEFINITION. The Employer elects to modify the
Compensation definition elected in (a), (b) or (c) as follows. (Choose one or
more of (f) through (n) as applicable. If the Employer elects to allocate its
nonelective contribution under Plan Section 3.04 using permitted disparity, (i),
(j), (k) and (l) do not apply):
[X] (f) FRINGE BENEFITS. The Plan excludes all reimbursements or other
expense allowances, fringe benefits (cash and noncash), moving
expenses, deferred compensation and welfare benefits.
[ ] (g) ELECTIVE CONTRIBUTIONS. The Plan excludes a Participant's Elective
Contributions. See Plan Section 1.07(D).
[ ] (h) EXCLUSION. The Plan excludes Compensation in excess of: ______.
[ ] (i) BONUSES. The Plan excludes bonuses.
[ ] (j) OVERTIME. The Plan excludes overtime.
[ ] (k) COMMISSIONS. The Plan excludes commissions.
[ ] (l) NONELECTIVE CONTRIBUTIONS. The following modifications apply to the
definition of Compensation for nonelective contributions: ______.
[ ] (m) DEFERRAL CONTRIBUTIONS. The following modifications apply to the
definition of Compensation for deferral contributions: ______.
[ ] (n) MATCHING CONTRIBUTIONS. The following modifications apply to the
definition of Compensation for matching contributions: ______.
5. PLAN YEAR/LIMITATION YEAR (1.24). Plan Year and Limitation Year mean the
12-consecutive month period (except for a short Plan Year) ending every: (Choose
(a) or (b). Choose (c) if applicable)
[X] (a) DECEMBER 31.
[ ] (b) OTHER: ______.
[ ] (c) SHORT PLAN YEAR: commencing on: ______ and ending on: ______.
6. EFFECTIVE DATE (1.10). The Employer's adoption of the Plan is a: (Choose one
of (a) or (b))
[ ] (a) NEW PLAN. The Effective Date of the Plan is: ______.
[X] (b) RESTATED PLAN. The restated Effective Date is: January 1, 1997.
This Plan is an amendment and restatement of an existing retirement
plan(s) originally established effective as of: January 1, 1992
7. HOUR OF SERVICE/ELAPSED TIME METHOD (1.15). The crediting method for Hours of
Service is: (Choose one or more of (a) through (d) as applicable)
[X] (a) ACTUAL METHOD. See Plan Section 1.15(B).
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[ ] (b) EQUIVALENCY METHOD. The Equivalency Method is: ______. [Note:
Insert "daily," "weekly," "semi-monthly payroll periods" or "monthly."]
See Plan Section 1.15(C).
[ ] (c) COMBINATION METHOD. In lieu of the Equivalency Method specified in
(b), the Actual Method applies for purposes of: ______.
[X] (d) ELAPSED TIME METHOD. In lieu of crediting Hours of Service, the
Elapsed Time Method applies for purposes of crediting Service for:
(Choose one or more of (1), (2) or (3) as applicable)
[X] (1) Eligibility under Article II.
[X] (2) Vesting under Article V.
[ ] (3) Contribution allocations under Article III.
8. PREDECESSOR EMPLOYER SERVICE (1.30). In addition to the predecessor service
the Plan must credit by reason of Section 1.30 of the Plan, the Plan credits as
Service under this Plan, service with the following predecessor employer(s):
N/A.
[Note: If the Plan does not credit any additional predecessor service under this
Section 1.30, insert "N/A" in the blank line. The Employer also may elect to
credit predecessor service with specified Participating Employers only. See the
Participation Agreement.] Service with the designated predecessor employer(s)
applies: (Choose one or more of (a) through (d) as applicable)
[ ] (a) ELIGIBILITY. For eligibility under Article II. See Plan Section
1.30 for time of Plan entry.
[ ] (b) VESTING. For vesting under Article V.
[ ] (c) CONTRIBUTION ALLOCATION. For contribution allocations under Article
III.
[ ] (d) EXCEPTIONS. Except for the following Service: ______.
ARTICLE II
ELIGIBILITY REQUIREMENTS
9. ELIGIBILITY (2.01).
ELIGIBILITY CONDITIONS. To become a Participant in the Plan, an Employee must
satisfy the following eligibility conditions: (Choose one or more of (a) through
(e) as applicable) [Note: If the Employer does not elect (c), the Employer's
elections under (a) and (b) apply to all types of contributions. The Employer as
to deferral contributions may not elect (b)(2) and may not elect more than 12
months in (b)(4) and (b)(5).]
[X] (a) AGE. Attainment of age 21 (not to exceed age 21).
[X] (b) SERVICE. Service requirement. (Choose one of (1) through (5))
[ ] (1) One Year of Service.
[ ] (2) Two Years of Service, without an intervening Break in Service.
See Plan Section 2.03(A).
[ ] (3) One Hour of Service (immediate completion of Service
requirement). The Employee satisfies the Service requirement on
his/her Employment Commencement Date.
[X] (4) 6 months (not exceeding 24).
[ ] (5) An Employee must complete ______ Hours of Service within the
______ time period following the Employee's Employment
Commencement Date. If an Employee does not complete the stated
Hours of Service during the specified time period (if any), the
Employee is subject to the One Year of Service requirement. [Note:
The number of hours may not exceed 1,000 and the time period may
not exceed 24 months. If the Plan does not require the Employee to
satisfy the Hours of Service requirement within a specified time
period, insert "N/A" in the second blank line.]
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[ ] (c) ALTERNATIVE 401(k)/401(m) ELIGIBILITY CONDITIONS. In lieu of the
elections in (a) and (b), the Employer elects the following eligibility
conditions for the following types of contributions: (Choose (1) or (2)
or both if the Employer wishes to impose less restrictive eligibility
conditions for deferral/Employee contributions or for matching
contributions)
(1) [ ] DEFERRAL/EMPLOYEE CONTRIBUTIONS: (Choose one of a.
through d. Choose e. if applicable)
a. [ ] One Year of Service
b. [ ] One Hour of Service (immediate completion of Service
requirement)
c. [ ] ______ months (not exceeding 12)
d. [ ] An Employee must complete ______ Hours of Service within
the ______ time period following an Employee's
Employment Commencement Date. If an Employee does not
complete the stated Hours of Service during the
specified time period (if any), the Employee is subject
to the One Year of Service requirement. [Note: The
number of hours may not exceed 1,000 and the time period
may not exceed 12 months. If the Plan does not require
the Employee to satisfy the Hours of Service requirement
within a specified time period, insert "N/A" in the
second blank line.]
e. [ ] Age ______ (not exceeding age 21)
(2) [ ] MATCHING CONTRIBUTIONS: (Choose one of f. through i.
Choose j. if applicable)
f. [ ] One Year of Service
g. [ ] One Hour of Service (immediate completion of Service
requirement)
h. [ ] ______ months (not exceeding 24)
i. [ ] An Employee must complete ______ Hours of Service within
the ______ time period following an Employee's
Employment Commencement Date. If an Employee does not
complete the stated Hours of Service during the
specified time period (if any), the Employee is subject
to the One Year of Service requirement. [Note: The
number of hours may not exceed 1,000 and the time period
may not exceed 24 months. If the Plan does not require
the Employee to satisfy the Hours of Service requirement
within a specified time period, insert "N/A" in the
second blank line.]
j. [ ] Age ______ (not exceeding age 21)
[ ] (d) SERVICE REQUIREMENTS: ______.
[Note: Any Service requirement the Employer elects in (d) must be
available under other Adoption Agreement elections or a combination
thereof.]
[ ] (e) DUAL ELIGIBILITY. The eligibility conditions of this Section 2.01
apply solely to an Employee employed by the Employer after ______. If
the Employee was employed by the Employer by the specified date, the
Employee will become a Participant on the latest of: (i) the Effective
Date; (ii) the restated Effective Date; (iii) the Employee's Employment
Commencement Date; or (iv) on the date the Employee attains age ______
(not exceeding age 21).
PLAN ENTRY DATE. "Plan Entry Date" means the Effective Date and: (Choose one of
(f) through (j). Choose (k) if applicable) [Note: If the Employer does not elect
(k), the elections under (f) through (j) apply to all types of contributions.
The Employer must elect at least one Entry Date per Plan Year.]
[ ] (f) SEMI-ANNUAL ENTRY DATES. The first day of the Plan Year and the
first day of the seventh month of the Plan Year.
[ ] (g) THE FIRST DAY OF THE PLAN YEAR.
[ ] (h) EMPLOYMENT COMMENCEMENT DATE (immediate eligibility).
[X] (i) THE FIRST DAY OF EACH: Month (e.g., "Plan Year quarter").
[ ] (j) THE FOLLOWING PLAN ENTRY DATES: ______.
[ ] (k) ALTERNATIVE 401(k)/401(m) PLAN ENTRY DATE(s). For the alternative
401(k)/401(m) eligibility conditions under (c), Plan Entry Date means:
(Choose (1) or (2) or both as applicable)
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(1) [ ] DEFERRAL/EMPLOYEE CONTRIBUTIONS
(Choose one of a. through d.)
a. [ ] Semi-annual Entry Dates
b. [ ] The first day of the Plan Year
c. [ ] Employment Commencement Date (immediate
eligibility)
d. [ ] The first day of each:
-----
(2) [ ] MATCHING CONTRIBUTIONS
(Choose one of e. through h.)
e. [ ] Semi-annual Entry Dates
f. [ ] The first day of the Plan Year
g. [ ] Employment Commencement Date (immediate
eligibility)
h. [ ] The first day of each:
-----
TIME OF PARTICIPATION. An Employee will become a Participant, unless excluded
under Section 1.11, on the Plan Entry Date (if employed on that date): (Choose
one of (l), (m) or (n). Choose (o) if applicable): [Note: If the Employer does
not elect (o), the election under (l), (m) or (n) applies to all types of
contributions.]
[X] (l) IMMEDIATELY FOLLOWING OR COINCIDENT WITH
[ ] (m) IMMEDIATELY PRECEDING OR COINCIDENT WITH
[ ] (n) NEAREST
[ ] (o) ALTERNATIVE 401(k)/401(m) ELECTION(s): (Choose (1) or (2) or both
as applicable)
(1) [ ] DEFERRAL CONTRIBUTIONS
a. [ ] Immediately following or coincident with
(2) [ ] MATCHING CONTRIBUTIONS
(Choose one of b., c. or d.)
b. [ ] Immediately following or coincident with
c. [ ] Immediately preceding or coincident with
d. [ ] Nearest
the date the Employee completes the eligibility conditions described in this
Section 2.01. [Note: Unless otherwise excluded under Section 1.11, an Employee
must become a Participant by the earlier of: (1) the first day of the Plan Year
beginning after the date the Employee completes the age and service requirements
of Code Section 410(a); or (2) 6 months after the date the Employee completes
those requirements.]
10. YEAR OF SERVICE - ELIGIBILITY (2.02). (Choose (a) and (b) as applicable):
[Note: If the Employer does not elect a Year of Service condition or elects the
Elapsed Time Method, the Employer should not complete (a) or (b).]
[ ] (a) YEAR OF SERVICE. An Employee must complete Hour(s) of Service
during an eligibility computation period to receive credit for a Year
of Service under Article II: [Note: The number may not exceed 1,000. If
left blank, the requirement is 1,000.]
[ ] (b) ELIGIBILITY COMPUTATION PERIOD. After the initial eligibility
computation period described in Plan Section 2.02, the Plan measures
the eligibility computation period as: (Choose one of (1) or (2))
[ ] (1) The Plan Year beginning with the Plan Year which includes the
first anniversary of the Employee's Employment Commencement Date.
[ ] (2) The 12-consecutive month period beginning with each
anniversary of the Employee's Employment Commencement Date.
11. PARTICIPATION - BREAK IN SERVICE (2.03). The one year hold-out rule
described in Plan Section 2.03(B): (Choose one of (a), (b) or (c))
[X] (a) NOT APPLICABLE. Does not apply to the Plan.
[ ] (b) APPLICABLE. Applies to the Plan and to all Participants.
[ ] (c) LIMITED APPLICATION. Applies to the Plan, but only to a Participant
who has incurred a Separation from Service.
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12. ELECTION NOT TO PARTICIPATE (2.06). The Plan: (Choose one of (a) or (b))
[X] (a) ELECTION NOT PERMITTED. Does not permit an eligible Employee to
elect not to participate.
[ ] (b) IRREVOCABLE ELECTION. Permits an Employee to elect not to
participate if the Employee makes a one-time irrevocable election prior
to the Employee's Plan Entry Date.
ARTICLE III
EMPLOYER CONTRIBUTIONS, DEFERRAL CONTRIBUTIONS AND FORFEITURES
13. AMOUNT AND TYPE (3.01). The amount and type(s) of the Employer's
contribution to the Trust for a Plan Year or other specified period will equal:
(Choose one or more of (a) through (f) as applicable)
[X] (a) DEFERRAL CONTRIBUTIONS (401(k) ARRANGEMENT). The dollar or
percentage amount by which each Participant has elected to reduce
his/her Compensation, as provided in the Participant's salary reduction
agreement and in accordance with Section 3.02.
[X] (b) MATCHING CONTRIBUTIONS (OTHER THAN SAFE HARBOR MATCHING
CONTRIBUTIONS UNDER SECTION 3.01(d)). The matching contributions made
in accordance with Section 3.03.
[X] (c) NONELECTIVE CONTRIBUTIONS (PROFIT SHARING). The following
nonelective contribution (Choose (1) or (2) or both as applicable):
[Note: The Employer may designate as a qualified nonelective
contribution, all or any portion of its nonelective contribution. See
Plan Section 3.04(F).]
[X] (1) DISCRETIONARY. An amount the Employer in its sole discretion
may determine.
[ ] (2) FIXED. The following amount: _____
[ ] (d) 401(k) SAFE HARBOR CONTRIBUTIONS. The following 401(k) safe harbor
contributions described in Plan Section 14.02(D): (Choose one of (1),
(2) or (3). Choose (4), if applicable)
[ ] (1) SAFE HARBOR NONELECTIVE CONTRIBUTION. The safe harbor
nonelective contribution equals _____% of a Participant's
Compensation [Note: the amount in the blank must be at least 3%.].
[ ] (2) BASIC SAFE HARBOR MATCHING CONTRIBUTION. A matching
contribution equal to 100% of each Participant's deferral
contributions not exceeding 3% of the Participant's Compensation,
plus 50% of each Participant's deferral contributions in excess of
3% but not in excess of 5% of the Participant's Compensation. For
this purpose, "Compensation" means Compensation for: _____. [Note:
The Employer must complete the blank line with the applicable time
period for computing the Employer's basic safe harbor match, such
as "each payroll period," "each month," "each Plan Year quarter" or
"the Plan Year".]
[ ] (3) ENHANCED SAFE HARBOR MATCHING CONTRIBUTION. (Choose one of a.
or b.).
[ ] a. UNIFORM PERCENTAGE. An amount equal to _____% of each
Participant's deferral contributions not exceeding _____% of
the Participant's Compensation. For this purpose,
"Compensation" means Compensation for: _____. [See the Note in
(d)(2).]
[ ] b. TIERED FORMULA. An amount equal to the specified matching
percentage for the corresponding level of each Participant's
deferral contribution percentage. For this purpose,
"Compensation" means Compensation for: _____. [See the Note in
(d)(2).]
<Table>
<Caption>
Deferral Contribution Percentage Matching Percentage
-------------------------------- -------------------
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</Table>
[Note: The matching percentage may not increase as the deferral contribution
percentage increases and the enhanced matching formula otherwise must satisfy
the requirements of Code Sections 401(k)(12)(B)(ii) and (iii). If the Employer
wishes to avoid ACP testing on its enhanced safe harbor matching contribution,
the Employer also must limit deferral contributions taken into account (the
"Deferral Contribution Percentage") for the matching contribution to 6% of Plan
Year Compensation.]
[ ] (4) ANOTHER PLAN. The Employer will satisfy the 401(k) safe harbor
contribution in the following plan: _____.
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[ ] (e) DAVIS-BACON CONTRIBUTIONS. The amount(s) specified for the
applicable Plan Year or other applicable period in the Employer's
Davis-Bacon contract(s). The Employer will make a contribution only to
Participants covered by the contract and only with respect to
Compensation paid under the contract. If the Participant accrues an
allocation of nonelective contributions (including forfeitures) under
the Plan in addition to the Davis-Bacon contribution, the Plan
Administrator will: (Choose one of (1) or (2))
[ ] (1) Not reduce the Participant's nonelective contribution
allocation by the Davis-Bacon contribution.
[ ] (2) Reduce the Participant's nonelective contribution allocation by
the Davis-Bacon contribution.
[ ] (f) FROZEN PLAN. This Plan is a frozen Plan effective: _____. For any
period following the specified date, the Employer will not contribute
to the Plan, a Participant may not contribute and an otherwise eligible
Employee will not become a Participant in the Plan.
14. DEFERRAL CONTRIBUTIONS (3.02). The following limitations and terms apply to
an Employee's deferral contributions: (If the Employer elects Section 3.01(a),
the Employer must elect (a). Choose (b) or (c) as applicable)
[X] (a) LIMITATION ON AMOUNT. An Employee's deferral contributions are
subject to the following limitation(s) in addition to those imposed by
the Code: (Choose (1), (2) or (3) as applicable)
[X] (1) Maximum deferral amount: 100%.
[X] (2) Minimum deferral amount: 1%.
[ ] (3) No limitations.
For the Plan Year in which an Employee first becomes a Participant, the Plan
Administrator will apply any percentage limitation the Employer elects in (1) or
(2) to the Employee's Compensation: (Choose one of (4) or (5) unless the
Employer elects (3))
[X] (4) Only for the portion of the Plan Year in which the Employee
actually is a Participant.
[ ] (5) For the entire Plan Year.
[ ] (b) NEGATIVE DEFERRAL ELECTION. The Employer will withhold _____% from
the Participant's Compensation unless the Participant elects a lesser
percentage (including zero) under his/her salary reduction agreement.
See Plan Section 14.02(C). The negative election will apply to: (Choose
one of (1) or (2))
[ ] (1) All Participants who have not deferred at least the automatic
deferral amount as of: _____.
[ ] (2) Each Employee whose Plan Entry Date is on or following the
negative election effective date.
[ ] (c) CASH OR DEFERRED CONTRIBUTIONS. For each Plan Year for which the
Employer makes a designated cash or deferred contribution under Plan
Section 14.02(B), a Participant may elect to receive directly in cash
not more than the following portion (or, if less, the 402(g)
limitation) of his/her proportionate share of that cash or deferred
contribution: (Choose one of (1) or (2))
[ ] (1) All or any portion.
[ ] (2) _____%.
MODIFICATION/REVOCATION OF SALARY REDUCTION AGREEMENT. A Participant
prospectively may modify or revoke a salary reduction agreement, or may file a
new salary reduction agreement following a prior revocation, at least once per
Plan Year or during any election period specified by the basic plan document or
required by the Internal Revenue Service. The Plan Administrator also may
provide for more frequent elections in the Plan's salary reduction agreement
form.
15. MATCHING CONTRIBUTIONS (INCLUDING ADDITIONAL SAFE HARBOR MATCH UNDER PLAN
SECTION 14.02(D)(3)) (3.03). The Employer matching contribution is: (If the
Employer elects Section 3.01(b), the Employer must elect one or more of (a), (b)
or (c) as applicable. Choose (d) if applicable)
[ ] (a) FIXED FORMULA. An amount equal to _____% of each Participant's
deferral contributions.
[X] (b) DISCRETIONARY FORMULA. An amount (or additional amount) equal to a
matching percentage the Employer from time to time may deem advisable
of the Participant's deferral contributions. The Employer, in its sole
discretion, may designate as a qualified matching contribution, all or
any portion of its discretionary matching contribution. The portion
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of the Employer's discretionary matching contribution for a Plan Year
not designated as a qualified matching contribution is a regular
matching contribution.
[ ] (c) MULTIPLE LEVEL FORMULA. An amount equal to the following
percentages for each level of the Participant's deferral contributions.
[Note: The matching percentage only will apply to deferral
contributions in excess of the previous level and not in excess of the
stated deferral contribution percentage.]
<Table>
<Caption>
Deferral Contributions Matching Percentage
---------------------- -------------------
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</Table>
[ ] (d) RELATED EMPLOYERS. If two or more Related Employers contribute to
this Plan, the Plan Administrator will allocate matching contributions
and matching contribution forfeitures only to the Participants directly
employed by the contributing Employer. The matching contribution
formula for the other Related Employer(s) is: _____. [Note: If the
Employer does not elect (d), the Plan Administrator will allocate all
matching contributions and matching forfeitures without regard to which
contributing Related Employer directly employs the Participant.]
TIME PERIOD FOR MATCHING CONTRIBUTIONS. The Employer will determine its matching
contribution based on deferral contributions made during each: (Choose one of
(e) through (h))
[X] (e) PLAN YEAR.
[ ] (f) PLAN YEAR QUARTER.
[ ] (g) PAYROLL PERIOD.
[ ] (h) ALTERNATIVE TIME PERIOD: _____. [Note: Any alternative time period
the Employer elects in (h) must be the same for all Participants and
may not exceed the Plan Year.]
DEFERRAL CONTRIBUTIONS TAKEN INTO ACCOUNT. In determining a Participant's
deferral contributions taken into account for the above-specified time period
under the matching contribution formula, the following limitations apply:
(Choose one of (i), (j) or (k))
[ ] (i) ALL DEFERRAL CONTRIBUTIONS. The Plan Administrator will take into
account all deferral contributions.
[ ] (j) SPECIFIC LIMITATION. The Plan Administrator will disregard deferral
contributions exceeding _____% of the Participant's Compensation.
[Note: To avoid the ACP test in a safe harbor 401(k) plan, the Employer
must limit deferrals and Employee contributions which are subject to
match to 6% of Plan Year Compensation.]
[X] (k) DISCRETIONARY. The Plan Administrator will take into account the
deferral contributions as a percentage of the Participant's
Compensation as the Employer determines.
OTHER MATCHING CONTRIBUTION REQUIREMENTS. The matching contribution formula is
subject to the following additional requirements: (Choose (l) or (m) or both if
applicable)
[ ] (l) MATCHING CONTRIBUTION LIMITS. A Participant's matching
contributions may not exceed: (Choose one of (1) or (2))
[ ] (1) _____. [Note: The Employer may elect (1) to place an overall
dollar or percentage limit on matching contributions.]
[ ] (2) 4% of a Participant's Compensation for the Plan Year under the
discretionary matching contribution formula. [Note: The Employer
must elect (2) if it elects a discretionary matching formula with
the safe harbor 401(k) contribution formula and wishes to avoid the
ACP test.]
[ ] (m) QUALIFIED MATCHING CONTRIBUTIONS. The Plan Administrator will
allocate as qualified matching contributions, the matching
contributions specified in Adoption Agreement Section: _____. The Plan
Administrator will allocate all other matching contributions as regular
matching contributions. [Note: If the Employer elects two matching
formulas, the Employer may use (m) to designate one of the formulas as
a qualified matching contribution.]
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16. CONTRIBUTION ALLOCATION (3.04).
EMPLOYER NONELECTIVE CONTRIBUTIONS (3.04(A)).The Plan Administrator will
allocate the Employer's nonelective contribution under the following
contribution allocation formula: (Choose one of (a), (b) or (c). Choose (d) if
applicable)
[X] (a) NONINTEGRATED (PRO RATA) ALLOCATION FORMULA.
[ ] (b) PERMITTED DISPARITY. The following permitted disparity formula and
definitions apply to the Plan: (Choose one of (1) or (2). Also choose
(3))
[ ] (1) Two-tiered allocation formula.
[ ] (2) Four-tiered allocation formula.
[ ] (3) For purposes of Section 3.04(b), "Excess Compensation" means
Compensation in excess of: (Choose one of a. or b.)
[ ] a. _____% of the taxable wage base in effect on the first day
of the Plan Year, rounded to the next highest $_____ (not
exceeding the taxable wage base).
[ ] b. The following integration level: _____.
[Note: The integration level cannot exceed the taxable wage
base in effect for the Plan Year for which this Adoption
Agreement first is effective.]
[ ] (c) UNIFORM POINTS ALLOCATION FORMULA. Under the uniform points
allocation formula, a Participant receives: (Choose (1) or both (1) and
(2) as applicable)
[ ] (1) point(s) for each Year of Service. Year of Service means:
-----.
[ ] (2) One point for each $_____ [not to exceed $200] increment of
Plan Year Compensation.
[ ] (d) INCORPORATION OF CONTRIBUTION FORMULA. The Plan Administrator
will allocate the Employer's nonelective contribution under Section(s)
3.01(c)(2), (d)(1) or (e) in accordance with the contribution formula
adopted by the Employer under that Section.
QUALIFIED NONELECTIVE CONTRIBUTIONS. (3.04(F)). The Plan Administrator will
allocate the Employer's qualified nonelective contributions to: (Choose one of
(e) or (f))
[X] (e) NONHIGHLY COMPENSATED EMPLOYEES ONLY.
[ ] (f) ALL PARTICIPANTS.
RELATED EMPLOYERS. (Choose (g) if applicable)
[ ] (g) ALLOCATE ONLY TO DIRECTLY EMPLOYED PARTICIPANTS. If two or more
Related Employers adopt this Plan, the Plan Administrator will allocate
all nonelective contributions and forfeitures attributable to
nonelective contributions only to the Participants directly employed by
the contributing Employer. If a Participant receives Compensation from
more than one contributing Employer, the Plan Administrator will
determine the allocations under this Section 3.04 by prorating the
Participant's Compensation between or among the participating Related
Employers. [Note: If the Employer does not elect 3.04(g), the Plan
Administrator will allocate all nonelective contributions and
forfeitures without regard to which contributing Related Employer
directly employs the Participant. The Employer may not elect 3.04(g)
under a safe harbor 401(k) Plan.]
17. FORFEITURE ALLOCATION (3.05). The Plan Administrator will allocate a
Participant forfeiture: (Choose one or more of (a), (b) or (c) as applicable)
[Note: Even if the Employer elects immediate vesting, the Employer should
complete Section 3.05. See Plan Section 9.11.]
[X] (a) MATCHING CONTRIBUTION FORFEITURES. To the extent attributable to
matching contributions: (Choose one of (1) through (4))
[ ] (1) As a discretionary matching contribution.
[X] (2) To reduce matching contributions.
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9
[ ] (3) As a discretionary nonelective contribution.
[ ] (4) To reduce nonelective contributions.
[X] (b) NONELECTIVE CONTRIBUTION FORFEITURES. To the extent attributable to
Employer nonelective contributions: (Choose one of (1) through (4))
[ ] (1) As a discretionary nonelective contribution.
[X] (2) To reduce nonelective contributions.
[ ] (3) As a discretionary matching contribution.
[ ] (4) To reduce matching contributions.
[X] (c) REDUCE ADMINISTRATIVE EXPENSES. First to reduce the Plan's ordinary
and necessary administrative expenses for the Plan Year and then
allocate any remaining forfeitures in the manner described in Sections
3.05(a) or (b) as applicable.
TIMING OF FORFEITURE ALLOCATION. The Plan Administrator will allocate
forfeitures under Section 3.05 in the Plan Year: (Choose one of (d) or (e))
[ ] (d) In which the forfeiture occurs.
[X] (e) Immediately following the Plan Year in which the forfeiture occurs.
18. ALLOCATION CONDITIONS (3.06).
ALLOCATION CONDITIONS. The Plan does not apply any allocation conditions to
deferral contributions, 401(k) safe harbor contributions (under Section 3.01(d))
or to Davis-Bacon contributions (except as the Davis-Bacon contract provides).
To receive an allocation of matching contributions, nonelective contributions,
qualified nonelective contributions or Participant forfeitures, a Participant
must satisfy the following allocation condition(s): (Choose one or more of (a)
through (i) as applicable)
[X] (a) HOURS OF SERVICE CONDITION. The Participant must complete at least
the specified number of Hours of Service (not exceeding 1,000) during
the Plan Year: 1,000.
[X] (b) EMPLOYMENT CONDITION. The Participant must be employed by the
Employer on the last day of the Plan Year (designate time period).
[ ] (c) NO ALLOCATION CONDITIONS.
[ ] (d) ELAPSED TIME METHOD. The Participant must complete at least the
specified number (not exceeding 182) of consecutive calendar days of
employment with the Employer during the Plan Year: _____.
[ ] (e) TERMINATION OF SERVICE/501 HOURS OF SERVICE COVERAGE RULE. The
Participant either must be employed by the Employer on the last day of
the Plan Year or must complete at least 501 Hours of Service during the
Plan Year. If the Plan uses the Elapsed Time Method of crediting
Service, the Participant must complete at least 91 consecutive calendar
days of employment with the Employer during the Plan Year.
[ ] (f) SPECIAL ALLOCATION CONDITIONS FOR MATCHING CONTRIBUTIONS. The
Participant must complete at least _____ Hours of Service during the
(designate time period) for the matching contributions made for that
time period.
[ ] (g) DEATH, DISABILITY OR NORMAL RETIREMENT AGE. Any condition specified
in Section 3.06 _____ applies if the Participant incurs a Separation
from Service during the Plan Year on account of: _____ (e.g., death,
Disability or Normal Retirement Age).
[X] (h) SUSPENSION OF ALLOCATION CONDITIONS FOR COVERAGE. The suspension of
allocation conditions of Plan Section 3.06(E) applies to the Plan.
[ ] (i) LIMITED ALLOCATION CONDITIONS. The Plan does not impose an
allocation condition for the following types of contributions: _____.
[Note: Any election to limit the Plan's allocation conditions to
certain contributions must be the same for all Participants, be
definitely determinable and not discriminate in favor of Highly
Compensated Employees.]
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ARTICLE IV
PARTICIPANT CONTRIBUTIONS
19. EMPLOYEE (AFTER TAX) CONTRIBUTIONS (4.02). The following elections apply to
Employee contributions: (Choose one of (a) or (b). Choose (c) if applicable)
[X] (a) NOT PERMITTED. The Plan does not permit Employee contributions.
[ ] (b) PERMITTED. The Plan permits Employee contributions subject to the
following limitations: _____. [Note: Any designated limitation(s) must
be the same for all Participants, be definitely determinable and not
discriminate in favor of Highly Compensated Employees.]
[ ] (c) MATCHING CONTRIBUTION. For each Plan Year, the Employer's matching
contribution made with respect to Employee contributions is: _____.
ARTICLE V
VESTING REQUIREMENTS
20. NORMAL/EARLY RETIREMENT AGE (5.01). A Participant attains Normal Retirement
Age (or Early Retirement Age, if applicable) under the Plan on the following
date: (Choose one of (a) or (b). Choose (c) if applicable)
[X] (a) SPECIFIC AGE. The date the Participant attains age 65. [Note: The
age may not exceed age 65.]
[ ] (b) AGE/PARTICIPATION. The later of the date the Participant attains
_____ years of age or the _____ anniversary of the first day of the
Plan Year in which the Participant commenced participation in the Plan.
[Note: The age may not exceed age 65 and the anniversary may not exceed
the 5th.]
[X] (c) EARLY RETIREMENT AGE. Early Retirement Age is the later of: (i) the
date a Participant attains age 55 or (ii) the date a Participant
reaches his/her 5th anniversary of the first day of the Plan Year in
which the Participant commenced participation in the Plan.
21. PARTICIPANT'S DEATH OR DISABILITY (5.02). The 100% vesting rule under Plan
Section 5.02 does not apply to: (Choose (a) or (b) or both as applicable)
[ ] (a) DEATH.
[ ] (b) DISABILITY.
22. VESTING SCHEDULE (5.03). A Participant has a 100% Vested interest at all
times in his/her deferral contributions, qualified nonelective contributions,
qualified matching contributions, 401(k) safe harbor contributions and
Davis-Bacon contributions (unless otherwise indicated in (f)). The following
vesting schedule applies to Employer regular matching contributions and to
Employer nonelective contributions: (Choose (a) or choose one or more of (b)
through (f) as applicable)
[ ] (a) IMMEDIATE VESTING. 100% Vested at all times. [Note: The Employer
must elect (a) if the Service condition under Section 2.01 exceeds One
Year of Service or more than twelve months.]
[X] (b) TOP-HEAVY VESTING SCHEDULES. [Note: The Employer must choose one of
(b)(1), (2) or (3) if it does not elect (a).]
[ ] (1) 6-year graded as specified in the Plan.
[ ] (2) 3-year cliff as specified in the Plan.
[X] (3) Modified top-heavy schedule
<Table>
<Caption>
Years of Vested
Service Percentage
-------- ----------
Less than 1 ................... 0%
1 .......................... 0%
2 .......................... 40%
3 .......................... 60%
4 .......................... 80%
5 .......................... 100%
</Table>
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[X] (c) NON-TOP-HEAVY VESTING SCHEDULES. [Note: The Employer may elect one
of (c)(1), (2) or (3) in addition to (b).]
[ ] (1) 7-year graded as specified in the Plan.
[ ] (2) 5-year cliff as specified in the Plan.
[X] (3) Modified non-top-heavy schedule
<Table>
<Caption>
Years of Vested
Service Percentage
-------- ----------
Less than 1 ................... 0%
1 .......................... 0%
2 .......................... 40%
3 .......................... 60%
4 .......................... 80%
5 .......................... 100%
</Table>
If the Employer does not elect (c), the vesting schedule elected in (b) applies
to all Plan Years. [Note: The modified top-heavy schedule of (b)(3) must satisfy
Code Section 416. If the Employer elects (c)(3), the modified non-top-heavy
schedule must satisfy Code Section 411(a)(2).]
[ ] (d) SEPARATE VESTING ELECTION FOR REGULAR MATCHING CONTRIBUTIONS. In
lieu of the election under (a), (b) or (c), the following vesting
schedule applies to a Participant's regular matching contributions:
(Choose one of (1) or (2))
[ ] (1) 100% Vested at all times.
[ ] (2) Regular matching vesting schedule: _____. [Note: The vesting
schedule completed under (d)(2) must comply with Code Section
411(a)(4).]
[ ] (e) APPLICATION OF TOP-HEAVY SCHEDULE. The non-top-heavy schedule
elected under (c) applies in all Plan Years in which the Plan is not a
top-heavy plan. [Note: If the Employer does not elect (e), the
top-heavy vesting schedule will apply for the first Plan Year in which
the Plan is top-heavy and then in all subsequent Plan Years.]
[ ] (f) SPECIAL VESTING PROVISIONS: _____. [Note: Any special vesting
provision must satisfy Code Section 411(a). Any special vesting
provision must be definitely determinable, not discriminate in favor of
Highly Compensated Employees and not violate Code Section 401(a)(4).]
23. YEAR OF SERVICE - VESTING (5.06). (Choose (a) and (b)): [Note: If the
Employer elects the Elapsed Time Method or elects immediate vesting, the
Employer should not complete (a) or (b).]
[ ] (a) YEAR OF SERVICE. An Employee must complete at least _____ Hours of
Service during a vesting computation period to receive credit for a
Year of Service under Article V. [Note: The number may not exceed
1,000. If left blank, the requirement is 1,000.]
[ ] (b) VESTING COMPUTATION PERIOD. The Plan measures a Year of Service on
the basis of the following 12-consecutive month period: (Choose one of
(1) or (2))
[ ] (1) Plan Year.
[ ] (2) Employment year (anniversary of Employment Commencement Date).
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24. EXCLUDED YEARS OF SERVICE - VESTING (5.08). The Plan excludes the following
Years of Service for purposes of vesting: (Choose (a) or choose one or more of
(b) through (f) as applicable)
[ ] (a) NONE. None other than as specified in Plan Section 5.08(a).
[X] (b) AGE 18. Any Year of Service before the Year of Service during which
the Participant attained the age of 18.
[ ] (c) PRIOR TO PLAN ESTABLISHMENT. Any Year of Service during the period
the Employer did not maintain this Plan or a predecessor plan.
[ ] (d) PARITY BREAK IN SERVICE. Any Year of Service excluded under the
rule of parity. See Plan Section 5.10.
[ ] (e) PRIOR PLAN TERMS. Any Year of Service disregarded under the terms
of the Plan as in effect prior to this restated Plan.
[ ] (f) ADDITIONAL EXCLUSIONS. Any Year of Service before: _____.
[Note: Any exclusion specified under (f) must comply with Code Section
411(a)(4). Any exclusion must be definitely determinable, not
discriminate in favor of Highly Compensated Employees and not violate
Code Section 401(a)(4). If the Employer elects immediate vesting, the
Employer should not complete Section 5.08.]
ARTICLE VI
DISTRIBUTION OF ACCOUNT BALANCE
25. TIME OF PAYMENT OF ACCOUNT BALANCE (6.01). The following time of
distribution elections apply to the Plan:
SEPARATION FROM SERVICE/VESTED ACCOUNT BALANCE NOT EXCEEDING $5,000. Subject to
the limitations of Plan Section 6.01(A)(1), the Trustee will distribute in a
lump sum (regardless of the Employer's election under Section 6.04) a separated
Participant's Vested Account Balance not exceeding $5,000: (Choose one of (a)
through (d))
[X] (a) IMMEDIATE. As soon as administratively practicable following the
Participant's Separation from Service.
[ ] (b) DESIGNATED PLAN YEAR. As soon as administratively practicable in
the _____ Plan Year beginning after the Participant's Separation from
Service.
[ ] (c) DESIGNATED PLAN YEAR QUARTER. As soon as administratively
practicable in the _____ Plan Year quarter beginning after the
Participant's Separation from Service.
[ ] (d) DESIGNATED DISTRIBUTION. As soon as administratively practicable in
the: _____ following the Participant's Separation from Service. [Note:
The designated distribution time must be the same for all Participants,
be definitely determinable, not discriminate in favor of Highly
Compensated Employees and not violate Code Section 401(a)(4).]
SEPARATION FROM SERVICE/VESTED ACCOUNT BALANCE EXCEEDING $5,000. A separated
Participant whose Vested Account Balance exceeds $5,000 may elect to commence
distribution of his/her Vested Account Balance no earlier than:
(Choose one of (e) through (i). Choose (j) if applicable)
[X] (e) IMMEDIATE. As soon as administratively practicable following the
Participant's Separation from Service.
[ ] (f) DESIGNATED PLAN YEAR. As soon as administratively practicable in
the _____ Plan Year beginning after the Participant's Separation from
Service.
[ ] (g) DESIGNATED PLAN YEAR QUARTER. As soon as administratively
practicable in the _____ Plan Year quarter following the Plan Year
quarter in which the Participant elects to receive a distribution.
[ ] (h) NORMAL RETIREMENT AGE. As soon as administratively practicable
after the close of the Plan Year in which the Participant attains
Normal Retirement Age and within the time required under Plan Section
6.01(A)(2).
[ ] (i) DESIGNATED DISTRIBUTION. As soon as administratively practicable in
the: _____ following the Participant's Separation from Service. [Note:
The designated distribution time must be the same for all Participants,
be definitely determinable, not discriminate in favor of Highly
Compensated Employees and not violate Code Section 401(a)(4).]
[ ] (j) LIMITATION ON PARTICIPANT'S RIGHT TO DELAY DISTRIBUTION. A
Participant may not elect to delay commencement of distribution of
his/her Vested Account Balance beyond the later of attainment of age 62
or Normal Retirement Age.
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[Note: If the Employer does not elect (j), the Plan permits a
Participant who has Separated from Service to delay distribution until
his/her required beginning date. See Plan Section 6.01(A)(2).]
PARTICIPANT ELECTIONS PRIOR TO SEPARATION FROM SERVICE. A Participant, prior to
Separation from Service may elect any of the following distribution options in
accordance with Plan Section 6.01(C). (Choose (k) or choose one or more of (l)
through (o) as applicable). [Note: If the Employer elects any in-service
distributions option, a Participant may elect to receive one in-service
distribution per Plan Year unless the Plan's in-service distribution form
provides for more frequent in-service distributions.]
[ ] (k) NONE. A Participant does not have any distribution option prior
to Separation from Service, except as may be provided under Plan
Section 6.01(C).
[ ] (l) DEFERRAL CONTRIBUTIONS. Distribution of all or any portion (as
permitted by the Plan) of a Participant's Account Balance attributable
to deferral contributions if: (Choose one or more of (1), (2) or (3) as
applicable)
[ ] (1) HARDSHIP (SAFE HARBOR HARDSHIP RULE). The Participant has
incurred a hardship in accordance with Plan Sections 6.09 and
14.11(A).
[ ] (2) AGE. The Participant has attained age _____ (Must be at least
age 59 1/2).
[ ] (3) DISABILITY. The Participant has incurred a Disability.
[ ] (m) QUALIFIED NONELECTIVE CONTRIBUTIONS/QUALIFIED MATCHING
CONTRIBUTIONS/SAFE HARBOR CONTRIBUTIONS. Distribution of all or any
portion of a Participant's Account Balance attributable to qualified
nonelective contributions, to qualified matching contributions, or to
401(k) safe harbor contributions if: (Choose (1) or (2) or both as
applicable)
[ ] (1) AGE. The Participant has attained age _____ (Must be at least
age 59 1/2).
[ ] (2) DISABILITY. The Participant has incurred a Disability.
[X] (n) NONELECTIVE CONTRIBUTIONS/REGULAR MATCHING CONTRIBUTIONS.
Distribution of all or any portion of a Participant's Vested Account
Balance attributable to nonelective contributions or to regular
matching contributions if: (Choose one or more of (1) through (5) as
applicable)
[X] (1) AGE/SERVICE CONDITIONS. (Choose one or more of a. through d. as
applicable):
[X] a. AGE. The Participant has attained age 59 1/2.
[ ] b. TWO-YEAR ALLOCATIONS. The Plan Administrator has allocated
the contributions to be distributed for a period of not less
than _____ Plan Years before the distribution date. [Note: The
minimum number of years is 2.]
[ ] c. FIVE YEARS OF PARTICIPATION. The Participant has
participated in the Plan for at least _____ Plan Years. [Note:
The minimum number of years is 5.]
[ ] d. VESTED. The Participant is _____% Vested in his/her Account
Balance. See Plan Section 5.03(A). [Note: If an Employer makes
more than one election under Section 6.01(n)(1), a Participant
must satisfy all conditions before the Participant is eligible
for the distribution.]
[ ] (2) HARDSHIP. The Participant has incurred a hardship in accordance
with Plan Section 6.09.
[X] (3) HARDSHIP (SAFE HARBOR HARDSHIP RULE). The Participant has
incurred a hardship in accordance with Plan Sections 6.09 and
14.11(A).
[ ] (4) DISABILITY. The Participant has incurred a Disability.
[ ] (5) DESIGNATED CONDITION. The Participant has satisfied the
following condition(s): _____. [Note: Any designated condition(s)
must be the same for all Participants, be definitely determinable
and not discriminate in favor of Highly Compensated Employees.]
[ ] (o) PARTICIPANT CONTRIBUTIONS. Distribution of all or any portion of a
Participant's Account Balance attributable to the following Participant
contributions described in Plan Section 4.01: (Choose one of (1), (2)
or (3))
[ ] (1) ALL PARTICIPANT CONTRIBUTIONS.
(C) Copyright 2001 AMVESCAP National Trust Company
14
[ ] (2) EMPLOYEE CONTRIBUTIONS ONLY.
[ ] (3) ROLLOVER CONTRIBUTIONS ONLY.
PARTICIPANT LOAN DEFAULT/OFFSET. See Section 6.08 of the Plan.
26. DISTRIBUTION METHOD (6.03). A separated Participant whose Vested Account
Balance exceeds $5,000 may elect distribution under one of the following
method(s) of distribution described in Plan Section 6.03: (Choose one or more of
(a) through (d) as applicable)
[X] (a) LUMP SUM.
[ ] (b) INSTALLMENTS.
[ ] (c) INSTALLMENTS FOR REQUIRED MINIMUM DISTRIBUTIONS ONLY.
[X] (d) ANNUITY DISTRIBUTION OPTION(s): Pursuant to Article VI of the
Master Plan Document.
[Note: Any optional method of distribution may not be subject to
Employer, Plan Administrator or Trustee discretion.]
27. JOINT AND SURVIVOR ANNUITY REQUIREMENTS (6.04). The joint and survivor
annuity distribution requirements of Plan Section 6.04: (Choose one of (a) or
(b))
[X] (a) PROFIT SHARING PLAN EXCEPTION. Do not apply to a Participant,
unless the Participant is a Participant described in Section 6.04(H) of
the Plan.
[ ] (b) APPLICABLE. Apply to all Participants.
ARTICLE IX
PLAN ADMINISTRATOR - DUTIES WITH RESPECT TO PARTICIPANTS' ACCOUNTS
28. ALLOCATION OF NET INCOME, GAIN OR LOSS (9.08). For each type of contribution
provided under the Plan, the Plan allocates net income, gain or loss using the
following method: (Choose one or more of (a) through (e) as applicable)
[X] (a) DEFERRAL CONTRIBUTIONS/EMPLOYEE CONTRIBUTIONS. (Choose one or more
of (1) through (5) as applicable)
[X] (1) DAILY VALUATION METHOD. Allocate on each business day of the
Plan Year during which Plan assets for which there is an
established market are valued and the Trustee is conducting
business.
[ ] (2) BALANCE FORWARD METHOD. Allocate using the balance forward
method.
[ ] (3) WEIGHTED AVERAGE METHOD. Allocate using the weighted average
method, based on the following weighting period: _____. See Plan
Section 14.12.
[ ] (4) BALANCE FORWARD METHOD WITH ADJUSTMENT. Allocate pursuant to
the balance forward method, except treat as part of the relevant
Account at the beginning of the valuation period _____% of the
contributions made during the following valuation period: _____.
[ ] (5) INDIVIDUAL ACCOUNT METHOD. Allocate using the individual
account method. See Plan Section 9.08.
[X] (b) MATCHING CONTRIBUTIONS. (Choose one or more of (1) through (5) as
applicable)
[X] (1) DAILY VALUATION METHOD. Allocate on each business day of the
Plan Year during which Plan assets for which there is an
established market are valued and the Trustee is conducting
business.
[ ] (2) BALANCE FORWARD METHOD. Allocate using the balance forward
method.
[ ] (3) WEIGHTED AVERAGE METHOD. Allocate using the weighted average
method, based on the following weighting period: _____. See Plan
Section 14.12.
[ ] (4) BALANCE FORWARD METHOD WITH ADJUSTMENT. Allocate pursuant to
the balance forward method, except treat as part of the relevant
Account at the beginning of the valuation period _____% of the
contributions made during the following valuation period: _____.
(C) Copyright 2001 AMVESCAP National Trust Company
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[ ] (5) INDIVIDUAL ACCOUNT METHOD. Allocate using the individual
account method. See Plan Section 9.08.
[X] (c) EMPLOYER NONELECTIVE CONTRIBUTIONS. (Choose one or more of (1)
through (5) as applicable)
[X] (1) DAILY VALUATION METHOD. Allocate on each business day of the
Plan Year during which Plan assets for which there is an
established market are valued and the Trustee is conducting
business.
[ ] (2) BALANCE FORWARD METHOD. Allocate using the balance forward
method.
[ ] (3) WEIGHTED AVERAGE METHOD. Allocate using the weighted average
method, based on the following weighting period: _____. See Plan
Section 14.12.
[ ] (4) BALANCE FORWARD METHOD WITH ADJUSTMENT. Allocate pursuant to
the balance forward method, except treat as part of the relevant
Account at the beginning of the valuation period _____% of the
contributions made during the following valuation period: _____.
[ ] (5) INDIVIDUAL ACCOUNT METHOD. Allocate using the individual
account method. See Plan Section 9.08.
[ ] (d) SPECIFIED METHOD. Allocate pursuant to the following method: _____.
[Note: The specified method must be a definite predetermined formula
which is not based on Compensation, which satisfies the
nondiscrimination requirements of Treas. Reg. Section 1.401(a)(4) and
which is applied uniformly to all Participants.]
[ ] (e) INTEREST RATE FACTOR. In accordance with Plan Section 9.08(E),
the Plan includes interest at the following rate on distributions made
more than 90 days after the most recent valuation date: _____.
ARTICLE X
TRUSTEE AND CUSTODIAN, POWERS AND DUTIES
29. INVESTMENT POWERS (10.03). The following additional investment options or
limitations apply under Plan Section 10.03: N/A. [Note: Enter "N/A" if not
applicable.]
30. VALUATION OF TRUST (10.15). In addition to the last day of the Plan Year,
the Trustee must value the Trust Fund on the following valuation date(s):
(Choose one of (a) through (d))
[X] (a) DAILY VALUATION DATES. Each business day of the Plan Year on which
Plan assets for which there is an established market are valued and the
Trustee is conducting business.
[ ] (b) LAST DAY OF A SPECIFIED PERIOD. The last day of each _____ of the
Plan Year.
[ ] (c) SPECIFIED DATES: _____.
[ ] (d) NO ADDITIONAL VALUATION DATES.
(C) Copyright 2001 AMVESCAP National Trust Company
16
EXECUTION PAGE
The Trustee (and Custodian, if applicable), by executing this Adoption
Agreement, accepts its position and agrees to all of the obligations,
responsibilities and duties imposed upon the Trustee (or Custodian) under the
Prototype Plan and Trust. The Employer hereby agrees to the provisions of this
Plan and Trust, and in witness of its agreement, the Employer by its duly
authorized officers, has executed this Adoption Agreement, and the Trustee (and
Custodian, if applicable) has signified its acceptance, on: ___________________.
Name of Employer: M.D.C. Holdings, Inc.
------------------------------------
Employer's EIN: 84-0622967
--------------------------------------
Signed: /s/ PARIS G. REECE III
-----------------------------------------------------
Paris G. Reece III, EVP & CFO
-----------------------------------------------------
[Name/Title]
Name(s) of Trustee:
AMVESCAP National Trust Company
-----------------------------------------------------
-----------------------------------------------------
-----------------------------------------------------
-----------------------------------------------------
-----------------------------------------------------
Trust EIN (Optional):
-----------------------------------------------------
Signed: /s/ PHIL NOWICK
-----------------------------------------------------
PHIL NOWICK, VP FINANCE/STRATEGIC PLANNING
-----------------------------------------------------
[Name/Title]
Signed: /s/ MARK S. DUKE
-----------------------------------------------------
Mark S. Duke, Chief Human Relations Officer
-----------------------------------------------------
[Name/Title]
Signed: /s/ JOHN J. HEANEY
-----------------------------------------------------
John J. Heaney, Senior Vice President and Treasurer
-----------------------------------------------------
[Name/Title]
Signed: /s/ R. ERIC STARR
-----------------------------------------------------
R. Eric Starr, Trust Officer
-----------------------------------------------------
[Name/Title]
Signed:
-----------------------------------------------------
-----------------------------------------------------
[Name/Title]
Name of Custodian (Optional):
--------------------------------------------
Signed:
-----------------------------------------------------
-----------------------------------------------------
[Name/Title]
31. PLAN NUMBER. The 3-digit plan number the Employer assigns to this Plan for
ERISA reporting purposes (Form 5500 Series) is: 004.
USE OF ADOPTION AGREEMENT. Failure to complete properly the elections in this
Adoption Agreement may result in disqualification of the Employer's Plan. The
Employer only may use this Adoption Agreement in conjunction with the basic plan
document referenced by its document number on Adoption Agreement page one.
EXECUTION FOR PAGE SUBSTITUTION AMENDMENT ONLY. If this paragraph is completed,
this Execution Page documents an amendment to Adoption Agreement Section(s)
effective, by substitute Adoption Agreement page number(s) _____.
PROTOTYPE PLAN SPONSOR. The Prototype Plan Sponsor identified on the first page
of the basic plan document will notify all adopting employers of any amendment
of this Prototype Plan or of any abandonment or discontinuance by the Prototype
Plan Sponsor of its maintenance of this Prototype Plan. For inquiries regarding
the adoption of the Prototype Plan, the Prototype Plan
(C) Copyright 2001 AMVESCAP National Trust Company
17
Sponsor's intended meaning of any Plan provisions or the effect of the opinion
letter issued to the Prototype Plan Sponsor, please contact the Prototype Plan
Sponsor at the following address and telephone number: 1201 Peachtree St., 400
Colony Square, Ste. 2200, Atlanta, GA 30361, 800.538.6370. RELIANCE ON SPONSOR
OPINION LETTER. The Prototype Plan Sponsor has obtained from the IRS an opinion
letter specifying the form of this Adoption Agreement and the basic plan
document satisfy, as of the date of the opinion letter, Code Section 401. An
adopting Employer may rely on the Prototype Sponsor's IRS opinion letter only to
the extent provided in Announcement 2001-77, 2001-30 I.R.B. The Employer may not
rely on the opinion letter in certain other circumstances or with respect to
certain qualification requirements, which are specified in the opinion letter
and in Announcement 2001-77. In order to have reliance in such circumstances or
with respect to such qualification requirements, the Employer must apply for a
determination letter to Employee Plans Determinations of the Internal Revenue
Service.
(C) Copyright 2001 AMVESCAP National Trust Company
18
PARTICIPATION AGREEMENT
[X] CHECK HERE IF NOT APPLICABLE AND DO NOT COMPLETE THIS PAGE.
The undersigned Employer, by executing this Participation Agreement,
elects to become a Participating Employer in the Plan identified in Section 1.21
of the accompanying Adoption Agreement, as if the Participating Employer were a
signatory to that Adoption Agreement. The Participating Employer accepts, and
agrees to be bound by, all of the elections granted under the provisions of the
Prototype Plan as made by the Signatory Employer to the Execution Page of the
Adoption Agreement, except as otherwise provided in this Participation
Agreement.
32. EFFECTIVE DATE (1.10). The Effective Date of the Plan for the Participating
Employer is: ________________________.
33. NEW PLAN/RESTATEMENT. The Participating Employer's adoption of this Plan
constitutes: (Choose one of (a) or (b))
[ ] (a) The adoption of a new plan by the Participating Employer.
[ ] (b) The adoption of an amendment and restatement of a plan currently
maintained by the Participating Employer, identified as:
---------------------------------------------------------------------,
and having an original effective date of: ____________________________.
34. PREDECESSOR EMPLOYER SERVICE (1.30). In addition to the predecessor service
credited by reason of Section 1.30 of the Plan, the Plan credits as Service
under this Plan, service with this Participating Employer. (Choose one or more
of (a) through (d) as applicable): [Note: If the Plan does not credit any
additional predecessor service under Section 1.30 for this Participating
Employer, do not complete this election.]
[ ] (a) ELIGIBILITY. For eligibility under Article II. See Plan Section
1.30 for time of Plan entry.
[ ] (b) VESTING. For vesting under Article V.
[ ] (c) CONTRIBUTION ALLOCATION. For contribution allocations under Article
III.
[ ] (d) EXCEPTIONS. Except for the following Service: _____.
Name of Plan: Name of Participating Employer:
- ------------------------------- -----------------------------------
Signed:
----------------------------
[Name/Title]
-----------------------------------
[Date]
Participating Employer's EIN:
------
ACCEPTANCE BY THE SIGNATORY EMPLOYER TO THE EXECUTION PAGE OF THE ADOPTION
AGREEMENT AND BY THE TRUSTEE.
Name of Signatory Employer: Name(s) of Trustee:
- ------------------------------- -----------------------------------
- ------------------------------- -----------------------------------
[Name/Title] [Name/Title]
Signed: Signed:
------------------------ ----------------------------
- ------------------------------- -----------------------------------
[Date] [Date]
[Note: Each Participating Employer must execute a separate Participation
Agreement. If the Plan does not have a Participating Employer, the Signatory
Employer may delete this page from the Adoption Agreement.]
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APPENDIX A
TESTING ELECTIONS/EFFECTIVE DATE ADDENDUM
35. The following testing elections and special effective dates apply:
(Choose one or more of (a) through (n) as applicable)
[ ] (a) HIGHLY COMPENSATED EMPLOYEE (1.14). For Plan Years beginning after
_____, the Employer makes the following election(s) regarding the
definition of Highly Compensated Employee:
(1) [ ]TOP PAID GROUP ELECTION.
(2) [ ]CALENDAR YEAR DATA ELECTION (FISCAL YEAR PLAN).
[ ] (b) 401(k) CURRENT YEAR TESTING. The Employer will apply the current
year testing method in applying the ADP and ACP tests effective for
Plan Years beginning after: _____. [Note: For Plan Years beginning on
or after the Employer's execution of its "GUST" restatement, the
Employer must use the same testing method within the same Plan Year for
both the ADP and ACP tests.]
[ ] (c) COMPENSATION. The Compensation definition under Section 1.07 will
apply for Plan Years beginning after: _____.
[ ] (d) ELECTION NOT TO PARTICIPATE. The election not to participate under
Section 2.06 is effective: _____.
[ ] (e) 401(k) SAFE HARBOR. The 401(k) safe harbor provisions under Section
3.01(d) are effective: _____.
[ ] (f) NEGATIVE ELECTION. The negative election provision under Section
3.02(b) is effective: _____.
[ ] (g) CONTRIBUTION/ALLOCATION FORMULA. The specified contribution(s) and
allocation method(s) under Sections 3.01 and 3.04 are effective: _____.
[ ] (h) ALLOCATION CONDITIONS. The allocation conditions of Section 3.06
are effective: _____.
[ ] (i) BENEFIT PAYMENT ELECTIONS. The distribution elections of Section(s)
are effective: _____.
[ ] (j) ELECTION TO CONTINUE PRE-SBJPA REQUIRED BEGINNING DATE. A
Participant may not elect to defer commencement of the distribution of
his/her Vested Account Balance beyond the April 1 following the
calendar year in which the Participant attains age 70 1/2. See Plan
Section 6.02(A).
[ ] (k) ELIMINATION OF AGE 70 1/2 IN-SERVICE DISTRIBUTIONS. The Plan
eliminates a Participant's (other than a more than 5% owner) right to
receive in-service distributions on April 1 of the calendar year
following the year in which the Participant attains age 70 1/2 for Plan
Years beginning after: _____.
[ ] (l) ALLOCATION OF EARNINGS. The earnings allocation provisions under
Section 9.08 are effective: _____.
[ ] (m) ELIMINATION OF OPTIONAL FORMS OF BENEFIT. The Employer elects
prospectively to eliminate the following optional forms of benefit:
(Choose one or more of (1), (2) and (3) as applicable)
[ ] (1) QJSA and QPSA benefits as described in Plan Sections 6.04, 6.05
and 6.06 effective: _____.
[ ] (2) Installment distributions as described in Section 6.03
effective: _____.
[ ] (3) Other optional forms of benefit (Any election to eliminate must
be consistent with Treas. Reg. Section 1.411(d)-4): _____.
[X] (n) SPECIAL EFFECTIVE DATE(s): Section 2.01 is effective June 1, 2001.
Section 3.02 is effective January 1, 2002.
For periods prior to the above-specified special effective date(s), the
Plan terms in effect prior to its restatement under this Adoption Agreement will
control for purposes of the designated provisions. A special effective date may
not result in the delay of a Plan provision beyond the permissible effective
date under any applicable law.
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APPENDIX B
GUST REMEDIAL AMENDMENT PERIOD ELECTIONS
36. The following GUST restatement elections apply: (Choose one or more of
(a) through (j) as applicable)
[X] (a) HIGHLY COMPENSATED EMPLOYEE ELECTIONS. The Employer makes the
following remedial amendment period elections with respect to the
Highly Compensated Employee definition:
<Table>
(1) 1997: [ ] Top paid group election. [ ] Calendar year election.
[X] Calendar year data election.
(2) 1998: [ ] Top paid group election. [X] Calendar year data election.
(3) 1999: [ ] Top paid group election. [X] Calendar year data election.
(4) 2000: [ ] Top paid group election. [X] Calendar year data election.
(5) 2001: [ ] Top paid group election. [X] Calendar year data election.
(6) 2002: [ ] Top paid group election. [ ] Calendar year data election.
</Table>
[X] (b) 401(k) TESTING METHODS. The Employer makes the following remedial
amendment period elections with respect to the ADP test and the ACP
test: [Note: The Employer may use a different testing method for the
ADP and ACP tests through the end of the Plan Year in which the
Employer executes its GUST restated Plan.]
<Table>
<Caption>
ADP TEST ACP TEST
(1) 1997: [X] prior year [ ] current year 1997: [X] prior year [ ] current year
(2) 1998: [X] prior year [ ] current year 1998: [X] prior year [ ] current year
(3) 1999: [X] prior year [ ] current year 1999: [X] prior year [ ] current year
(4) 2000: [X] prior year [ ] current year 2000: [X] prior year [ ] current year
(5) 2001: [X] prior year [ ] current year 2001: [X] prior year [ ] current year
(6) 2002: [ ] prior year [ ] current year 2002: [ ] prior year [ ] current year
</Table>
[X] (c) DELAYED APPLICATION OF SBJPA REQUIRED BEGINNING DATE. The Employer
elects to delay the effective date for the required beginning date
provision of Plan Section 6.02 until Plan Years beginning after:
December 31, 1996.
[X] (d) MODEL AMENDMENT FOR REQUIRED MINIMUM DISTRIBUTIONS. The Employer
adopts the IRS Model Amendment in Plan Section 6.02(E) effective
January 1, 2001. [Note: The date must not be earlier than January 1,
2001.]
DEFINED BENEFIT LIMITATION
[X] (e) CODE SECTION 415(e) REPEAL. The repeal of the Code Section 415(e)
limitation is effective for Limitation Years beginning after December
31, 1999. [Note: If the Employer does not make an election under (e),
the repeal is effective for Limitation Years beginning after December
31, 1999.]
CODE SECTION 415(e) LIMITATION. To the extent necessary to satisfy the
limitation under Plan Section 3.17 for Limitation Years beginning prior to the
repeal of Code Section 415(e), the Employer will reduce: (Choose one of (f) or
(g))
[ ] (f) The Participant's projected annual benefit under the defined
benefit plan.
[ ] (g) The Employer's contribution or allocation on behalf of the
Participant to the defined contribution plan and then, if necessary,
the Participant's projected annual benefit under the defined benefit
plan.
COORDINATION WITH TOP-HEAVY MINIMUM ALLOCATION. The Plan Administrator will
apply the top-heavy minimum allocation provisions of Article XII with the
following modifications: (Choose (h) or choose (i) or (j) or both as applicable)
[X] (h) No modifications.
[ ] (i) For Non-Key Employees participating only in this Plan, the
top-heavy minimum allocation is the minimum allocation determined by
substituting _____% (not less than 4%) for "3%," except: (Choose one of
(1) or (2))
[ ] (1) No exceptions.
[ ] (2) Plan Years in which the top-heavy ratio exceeds 90%.
[ ] (j) For Non-Key Employees also participating in the defined benefit
plan, the top-heavy minimum is: (Choose one of (1) or (2))
[ ] (1) 5% of Compensation irrespective of the contribution rate of any
Key Employee: (Choose one of a. or b.)
[ ] a. No exceptions.
[ ] b. Substituting "7 1/2%" for "5%" if the top-heavy ratio does
not exceed 90%.
[ ] (2) 0%. [Note: The defined benefit plan must satisfy the top-heavy
minimum benefit requirement for these Non-Key Employees.]
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ACTUARIAL ASSUMPTIONS FOR TOP-HEAVY CALCULATION. To determine the top-heavy
ratio, the Plan Administrator will use the following interest rate and mortality
assumptions to value accrued benefits under a defined benefit plan: _____.
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CHECKLIST OF EMPLOYER INFORMATION
AND EMPLOYER ADMINISTRATIVE ELECTIONS
COMMENCING WITH THE 2002 PLAN YEAR
The Prototype Plan permits the Employer to make certain administrative
elections not reflected in the Adoption Agreement. This form lists those
administrative elections and provides a means of recording the Employer's
elections. This checklist is not part of the Plan document.
37. EMPLOYER INFORMATION.
M.D.C. Holdings, Inc.
----------------------------------------------------------------------
[Employer Name]
3600 South Yosemite Street, Suite 900
----------------------------------------------------------------------
[Address]
Denver, Colorado 80237 303.773.1100
---------------------------------------------- ---------------------
[City, State and Zip Code] [Telephone Number]
38. FORM OF BUSINESS.
(a) [X] Corporation
(b) [ ] S Corporation
(c) [ ] Limited Liability Company
(d) [ ] Sole Proprietorship
(e) [ ] Partnership
(f) [ ] _____
39. SECTION 1.07(F) - NONDISCRIMINATORY DEFINITION OF COMPENSATION. When
testing nondiscrimination under the Plan, the Plan permits the Employer
to make elections regarding the definition of Compensation. [Note: This
election solely is for purposes of nondiscrimination testing. The
election does not affect the Employer's elections under Section 1.07
which apply for purposes of allocating Employer contributions and
Participant forfeitures.]
(a) [ ]The Plan will "gross up" Compensation for Elective
Contributions.
(b) [ ]The Plan will exclude Elective Contributions.
40. SECTION 4.04 - ROLLOVER CONTRIBUTIONS.
(a) [X] The Plan accepts rollover contributions.
(b) [ ]The Plan does NOT accept rollover contributions.
41. SECTION 8.06 - PARTICIPANT DIRECTION OF INVESTMENT/404(c). The Plan
authorizes Participant direction of investment with Trustee consent. If
the Trustee permits Participant direction of investment, the Employer
and the Trustee should adopt a policy which establishes the applicable
conditions and limitations, including whether they intend the Plan to
comply with ERISA Section 404(c).
(a) [X] The Plan permits Participant direction of investment and
is a 404(c) plan.
(b) [ ] The Plan does NOT permit Participant direction of
investment or is a non-404(c) plan.
42. SECTION 9.04[A] - PARTICIPANT LOANS. The Plan authorizes the Plan
Administrator to adopt a written loan policy to permit Participant
loans.
(a) [X] The Plan permits Participant loans subject to the
following conditions:
(1) [X] Minimum loan amount: $ 1,000.
(2) [X] Maximum number of outstanding loans: 1.
(3) [X] Reasons for which a Participant may request a
loan:
a. [X] Any purpose.
b. [ ] Hardship events.
c. [ ] Other: _____.
(4) [X] Suspension of loan repayments:
a. [ ] Not permitted.
b. [X] Permitted for non-military leave of
absence.
c. [X] Permitted for military service leave of
absence.
(5) [X] The Participant must be a party in interest.
(b) [ ]The Plan does NOT permit Participant loans.
43. SECTION 11.01 - LIFE INSURANCE. The Plan with Employer approval
authorizes the Trustee to acquire life insurance.
(a) [ ]The Plan will invest in life insurance contracts.
(b) [X] The Plan will NOT invest in life insurance contracts.
44. SURETY BOND COMPANY: _____. Surety bond amount: $_____
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EGTRRA
AMENDMENT TO THE
M.D.C. HOLDINGS, INC. 401(K) SAVINGS PLAN
EGTRRA - SPONSOR
ARTICLE I
PREAMBLE
1.1 Adoption and effective date of amendment. This amendment of the plan is
adopted to reflect certain provisions of the Economic Growth and Tax
Relief Reconciliation Act of 2001 ("EGTRRA"). This amendment is
intended as good faith compliance with the requirements of EGTRRA and
is to be construed in accordance with EGTRRA and guidance issued
thereunder. Except as otherwise provided, this amendment shall be
effective as of the first day of the first plan year beginning after
December 31, 2001.
1.2 Adoption by prototype sponsor. Except as otherwise provided herein,
pursuant to Section 5.01 of Revenue Procedure 2000-20 (or pursuant to
the corresponding provision in Revenue Procedure 89-9 or Revenue
Procedure 89-13), the sponsor hereby adopts this amendment on behalf of
all adopting employers.
1.3 Supersession of inconsistent provisions. This amendment shall supersede
the provisions of the plan to the extent those provisions are
inconsistent with the provisions of this amendment.
ARTICLE II
ADOPTION AGREEMENT ELECTIONS
THE QUESTIONS IN THIS ARTICLE II ONLY NEED TO BE COMPLETED IN ORDER TO
OVERRIDE THE DEFAULT PROVISIONS SET FORTH BELOW. IF ALL OF THE DEFAULT
PROVISIONS WILL APPLY, THEN THESE QUESTIONS SHOULD BE SKIPPED.
UNLESS THE EMPLOYER ELECTS OTHERWISE IN THIS ARTICLE II, THE FOLLOWING
DEFAULTS APPLY:
1) THE VESTING SCHEDULE FOR MATCHING CONTRIBUTIONS WILL BE A 6 YEAR
GRADED SCHEDULE (IF THE PLAN CURRENTLY HAS A GRADED SCHEDULE THAT
DOES NOT SATISFY EGTRRA) OR A 3 YEAR CLIFF SCHEDULE (IF THE PLAN
CURRENTLY HAS A CLIFF SCHEDULE THAT DOES NOT SATISFY EGTRRA), AND
SUCH SCHEDULE WILL APPLY TO ALL MATCHING CONTRIBUTIONS (EVEN THOSE
MADE PRIOR TO 2002).
2) ROLLOVERS ARE AUTOMATICALLY EXCLUDED IN DETERMINING WHETHER THE
$5,000 THRESHOLD HAS BEEN EXCEEDED FOR AUTOMATIC CASH-OUTS (IF THE
PLAN IS NOT SUBJECT TO THE QUALIFIED JOINT AND SURVIVOR ANNUITY
RULES AND PROVIDES FOR AUTOMATIC CASH-OUTS). THIS IS APPLIED TO ALL
PARTICIPANTS REGARDLESS OF WHEN THE DISTRIBUTABLE EVENT OCCURRED.
3) THE SUSPENSION PERIOD AFTER A HARDSHIP DISTRIBUTION IS MADE WILL BE
6 MONTHS AND THIS WILL ONLY APPLY TO HARDSHIP DISTRIBUTIONS MADE
AFTER 2001.
4) CATCH-UP CONTRIBUTIONS WILL BE ALLOWED.
5) FOR TARGET BENEFIT PLANS, THE INCREASED COMPENSATION LIMIT OF
$200,000 WILL BE APPLIED RETROACTIVELY (I.E., TO YEARS PRIOR TO
2002).
2.1 VESTING SCHEDULE FOR MATCHING CONTRIBUTIONS
If there are matching contributions subject to a vesting schedule that
does not satisfy EGTRRA, then unless otherwise elected below, for
participants who complete an hour of service in a plan year beginning
after December 31, 2001, the following vesting schedule will apply to
all matching contributions subject to a vesting schedule:
If the plan has a graded vesting schedule (i.e., the vesting schedule
includes a vested percentage that is more than 0% and less than 100%)
the following will apply:
<Table>
<Caption>
Years of vesting service Nonforfeitable percentage
2 20%
3 40%
4 60%
5 80%
6 100%
</Table>
If the plan does not have a graded vesting schedule, then matching
contributions will be nonforfeitable upon the completion of 3 years of
vesting service.
In lieu of the above vesting schedule, the employer elects the
following schedule:
a. [ ] 3 year cliff (a participant's accrued benefit derived from
employer matching contributions shall be nonforfeitable upon the
participant's completion of three years of vesting service).
b. [ ] 6 year graded schedule (20% after 2 years of vesting service and
an additional 20% for each year thereafter).
c. [ ] Other (must be at least as liberal as a. or the b. above):
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EGTRRA - SPONSOR
<Table>
<Caption>
Years of vesting service Nonforfeitable percentage
-------- ---------%
-------- ---------%
-------- ---------%
-------- ---------%
-------- ---------%
</Table>
The vesting schedule set forth herein shall only apply to participants
who complete an hour of service in a plan year beginning after December
31, 2001, and, unless the option below is elected, shall apply to ALL
matching contributions subject to a vesting schedule.
d. [ ] The vesting schedule will only apply to matching
contributions made in plan years beginning after December 31,
2001 (the prior schedule will apply to matching contributions
made in prior plan years).
2.2 EXCLUSION OF ROLLOVERS IN APPLICATION OF INVOLUNTARY CASH-OUT
PROVISIONS (FOR PROFIT SHARING AND 401(k) PLANS ONLY). If the plan is
not subject to the qualified joint and survivor annuity rules and
includes involuntary cash-out provisions, then unless one of the
options below is elected, effective for distributions made after
December 31, 2001, rollover contributions will be excluded in
determining the value of the participant's nonforfeitable account
balance for purposes of the plan's involuntary cash-out rules.
a. [ ] Rollover contributions will not be excluded.
b. [ ] Rollover contributions will be excluded only with respect to
distributions made after _____. (Enter a date no earlier than
December 31, 2001.)
c. [ ] Rollover contributions will only be excluded with respect to
participants who separated from service after _____. (Enter a
date. The date may be earlier than December 31, 2001.)
2.3 SUSPENSION PERIOD OF HARDSHIP DISTRIBUTIONS. If the plan provides for
hardship distributions upon satisfaction of the safe harbor (deemed)
standards as set forth in Treas. Reg. Section 1.401(k)-1(d)(2)(iv),
then, unless the option below is elected, the suspension period
following a hardship distribution shall only apply to hardship
distributions made after December 31, 2001.
[ ] With regard to hardship distributions made during 2001, a
participant shall be prohibited from making elective deferrals
and employee contributions under this and all other plans until
the later of January 1, 2002, or 6 months after receipt of the
distribution.
2.4 CATCH-UP CONTRIBUTIONS (FOR 401(k) PROFIT SHARING PLANS ONLY): The plan
permits catch-up contributions (Article VI) unless the option below is
elected.
[ ] The plan does not permit catch-up contributions to be made.
2.5 FOR TARGET BENEFIT PLANS ONLY: The increased compensation limit
($200,000 limit) shall apply to years prior to 2002 unless the option
below is elected.
[ ] The increased compensation limit will not apply to years prior
to 2002.
ARTICLE III
VESTING OF MATCHING CONTRIBUTIONS
3.1 Applicability. This Article shall apply to participants who complete an
Hour of Service after December 31, 2001, with respect to accrued
benefits derived from employer matching contributions made in plan
years beginning after December 31, 2001. Unless otherwise elected by
the employer in Section 2.1 above, this Article shall also apply to all
such participants with respect to accrued benefits derived from
employer matching contributions made in plan years beginning prior to
January 1, 2002.
3.2 Vesting schedule. A participant's accrued benefit derived from employer
matching contributions shall vest as provided in Section 2.1 of this
amendment.
ARTICLE IV
INVOLUNTARY CASH-OUTS
4.1 Applicability and effective date. If the plan provides for involuntary
cash-outs of amounts less than $5,000, then unless otherwise elected in
Section 2.2 of this amendment, this Article shall apply for
distributions made after December 31, 2001, and shall apply to all
participants. However, regardless of the preceding, this Article shall
not apply if the plan is subject to the qualified joint and survivor
annuity requirements of Sections 401(a)(11) and 417 of the Code.
4.2 Rollovers disregarded in determining value of account balance for
involuntary distributions. For purposes of the Sections of the plan
that provide for the involuntary distribution of vested accrued
benefits of $5,000 or less, the value of a participant's nonforfeitable
account balance shall be determined without regard to that portion of
the account
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EGTRRA - SPONSOR
balance that is attributable to rollover contributions (and earnings
allocable thereto) within the meaning of Sections 402(c), 403(a)(4),
403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16) of the Code. If the value
of the participant's nonforfeitable account balance as so determined is
$5,000 or less, then the plan shall immediately distribute the
participant's entire nonforfeitable account balance.
ARTICLE V
HARDSHIP DISTRIBUTIONS
5.1 Applicability and effective date. If the plan provides for hardship
distributions upon satisfaction of the safe harbor (deemed) standards
as set forth in Treas. Reg. Section 1.401(k)-1(d)(2)(iv), then this
Article shall apply for calendar years beginning after 2001.
5.2 Suspension period following hardship distribution. A participant who
receives a distribution of elective deferrals after December 31, 2001,
on account of hardship shall be prohibited from making elective
deferrals and employee contributions under this and all other plans of
the employer for 6 months after receipt of the distribution.
Furthermore, if elected by the employer in Section 2.3 of this
amendment, a participant who receives a distribution of elective
deferrals in calendar year 2001 on account of hardship shall be
prohibited from making elective deferrals and employee contributions
under this and all other plans until the later of January 1, 2002, or 6
months after receipt of the distribution.
ARTICLE VI
CATCH-UP CONTRIBUTIONS
Catch-up Contributions. Unless otherwise elected in Section 2.4 of this
amendment, 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. 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.
ARTICLE VII
INCREASE IN COMPENSATION LIMIT
Increase in Compensation Limit. The annual compensation of each participant
taken into account in determining allocations for any plan year beginning after
December 31, 2001, shall not exceed $200,000, as adjusted for cost-of-living
increases in accordance with Section 401(a)(17)(B) of the Code. Annual
compensation means compensation during the plan year or such other consecutive
12-month period over which compensation is otherwise determined under the plan
(the determination period). If this is a target benefit plan, then except as
otherwise elected in Section 2.5 of this amendment, for purposes of determining
benefit accruals in a plan year beginning after December 31, 2001, compensation
for any prior determination period shall be limited to $200,000. The
cost-of-living adjustment in effect for a calendar year applies to annual
compensation for the determination period that begins with or within such
calendar year.
ARTICLE VIII
PLAN LOANS
Plan loans for owner-employees or shareholder-employees. If the plan permits
loans to be made to participants, then effective for plan loans made after
December 31, 2001, plan provisions prohibiting loans to any owner-employee or
shareholder-employee shall cease to apply.
ARTICLE IX
LIMITATIONS ON CONTRIBUTIONS (IRC SECTION 415 LIMITS)
9.1 Effective date. This Section shall be effective for limitation years
beginning after December 31, 2001.
9.2 Maximum annual addition. Except to the extent permitted under Article
VI of this amendment and Section 414(v) of the Code, if applicable, the
annual addition that may be contributed or allocated to a participant's
account under the plan for any limitation year shall not exceed the
lesser of:
a. $40,000, as adjusted for increases in the cost-of-living under
Section 415(d) of the Code, or
b. 100 percent of the participant's compensation, within the
meaning of Section 415(c)(3) of the Code, for the limitation
year.
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EGTRRA - SPONSOR
The compensation limit referred to in b. shall not apply to any
contribution for medical benefits after separation from service (within
the meaning of Section 401(h) or Section 419A(f)(2) of the Code) which
is otherwise treated as an annual addition.
ARTICLE X
MODIFICATION OF TOP-HEAVY RULES
10.1 Effective date. This Article shall apply for purposes of determining
whether the plan is a top-heavy plan under Section 416(g) of the Code
for plan years beginning after December 31, 2001, and whether the plan
satisfies the minimum benefits requirements of Section 416(c) of the
Code for such years. This Article amends the top-heavy provisions of
the plan.
10.2 Determination of top-heavy status.
10.2.1 Key employee. Key employee means any employee or former employee
(including any deceased employee) who at any time during the plan year
that includes the determination date was an officer of the employer
having annual compensation greater than $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.
10.2.2 Determination of present values and amounts. This Section 10.2.2 shall
apply for purposes of determining the present values of accrued
benefits and the amounts of account balances of employees as of the
determination date.
a. Distributions during year ending on the determination date.
The present values 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."
b. Employees not performing services during year ending on the
determination date. The accrued benefits and 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.
10.3 Minimum benefits.
10.3.1 Matching contributions. 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, if the plan provides that the minimum contribution
requirement shall be met in another plan, such other plan. 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.
10.3.2 Contributions under other plans. The employer may provide, in an
addendum to this amendment, 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). The
addendum should include the name of the other plan, the minimum benefit
that will be provided under such other plan, and the employees who will
receive the minimum benefit under such other plan.
ARTICLE XI
DIRECT ROLLOVERS
11.1 Effective date. This Article shall apply to distributions made after
December 31, 2001.
11.2 Modification of definition of eligible retirement plan. For purposes of
the direct rollover provisions of the plan, 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 transferred into such
plan from this plan. The definition of eligible retirement plan shall
also apply in the case of a distribution to a surviving spouse, or to a
spouse or former spouse who is the alternate payee under a qualified
domestic relation order, as defined in Section 414(p) of the Code.
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EGTRRA - SPONSOR
11.3 Modification of definition of eligible rollover distribution to exclude
hardship distributions. For purposes of the direct rollover provisions
of the plan, any amount that is distributed on account of hardship
shall not be an eligible rollover distribution and the distributee may
not elect to have any portion of such a distribution paid directly to
an eligible retirement plan.
11.4 Modification of definition of eligible rollover distribution to include
after-tax employee contributions. For purposes of the direct rollover
provisions in the plan, 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.
ARTICLE XII
ROLLOVERS FROM OTHER PLANS
Rollovers from other plans. The employer, operationally and on a
nondiscriminatory basis, may limit the source of rollover contributions that may
be accepted by this plan.
ARTICLE XIII
REPEAL OF MULTIPLE USE TEST
Repeal of Multiple Use Test. The multiple use test described in Treasury
Regulation Section 1.401(m)-2 and the plan shall not apply for plan years
beginning after December 31, 2001.
ARTICLE XIV
ELECTIVE DEFERRALS
14.1 Elective Deferrals - Contribution Limitation. No participant shall be
permitted to have elective deferrals made under this plan, or any other
qualified plan maintained by the employer during any 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
Article VI of this amendment and Section 414(v) of the Code, if
applicable.
14.2 Maximum Salary Reduction Contributions for SIMPLE plans. If this is a
SIMPLE 401(k) plan, then except to the extent permitted under Article
VI of this amendment and Section 414(v) of the Code, if applicable, the
maximum salary reduction contribution that can be made to this plan is
the amount determined under Section 408(p)(2)(A)(ii) of the Code for
the calendar year.
ARTICLE XV
SAFE HARBOR PLAN PROVISIONS
Modification of Top-Heavy Rules. The top-heavy requirements of Section 416 of
the Code and the plan shall not apply in any year beginning after December 31,
2001, in which the plan 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.
ARTICLE XVI
DISTRIBUTION UPON SEVERANCE OF EMPLOYMENT
16.1 Effective date. This Article shall apply for distributions and
transactions made after December 31, 2001, regardless of when the
severance of employment occurred.
16.2 New distributable event. A participant's elective deferrals, qualified
nonelective contributions, qualified matching contributions, and
earnings attributable to these contributions shall be distributed on
account of the participant's 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.
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EGTRRA - SPONSOR
Except with respect to any election made by the employer in Article II, this
amendment is hereby adopted by the prototype sponsor on behalf of all adopting
employers on:
[SPONSOR'S SIGNATURE AND ADOPTION DATE ARE ON FILE WITH SPONSOR]
NOTE: THE EMPLOYER ONLY NEEDS TO EXECUTE THIS AMENDMENT IF AN ELECTION HAS BEEN
MADE IN ARTICLE II OF THIS AMENDMENT.
This amendment has been executed this _______________________________ day of
_________________________________, __________.
Name of Employer: M.D.C. Holdings, Inc.
By:
-------------------------------------------
EMPLOYER
Name of Plan: M.D.C. Holdings, Inc. 401(k) Savings Plan
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