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EXHIBIT 10.11
THE ANGELL PENSION GROUP, INC. REGIONAL PROTOTYPE
DEFINED CONTRIBUTION PENSION PLAN AND TRUST
Copyright 1996 The Angell Pension Group, Inc.
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TABLE OF CONTENTS
ARTICLE PAGE
ARTICLE I: DEFINITIONS.........................................................1
ARTICLE II:TOP HEAVY PROVISIONS AND ADMINISTRATION............................16
2.1 TOP HEAVY PLAN REQUIREMENTS............................................16
2.2 DETERMINATION OF TOP HEAVY STATUS......................................16
2.3 POWERS AND RESPONSIBILITIES OF THE EMPLOYER............................19
2.4 DESIGNATION OF ADMINISTRATIVE AUTHORITY................................20
2.5 ALLOCATION AND DELEGATION OF...........................................20
2.6 POWERS AND DUTIES OF THE ADMINISTRATOR.................................20
2.7 RECORDS AND REPORTS....................................................22
2.8 APPOINTMENT OF ADVISERS................................................22
2.9 INFORMATION FROM EMPLOYER..............................................22
2.10 PAYMENT OF EXPENSES...................................................22
2.11 MAJORITY ACTIONS......................................................22
2.12 CLAIMS PROCEDURE......................................................23
2.13 CLAIMS REVIEW PROCEDURE...............................................23
ARTICLE III: ELIGIBILITY......................................................24
3.1 CONDITIONS OF ELIGIBILITY..............................................24
3.2 EFFECTIVE DATE OF PARTICIPATION........................................24
3.3 DETERMINATION OF ELIGIBILITY...........................................24
3.4 TERMINATION OF ELIGIBILITY.............................................24
3.5 OMISSION OF ELIGIBLE EMPLOYEE..........................................24
3.6 INCLUSION OF INELIGIBLE EMPLOYEE.......................................25
3.7 ELECTION NOT TO PARTICIPATE............................................25
3.8 CONTROL OF ENTITIES BY OWNER-EMPLOYEE..................................25
ARTICLE IV: CONTRIBUTION AND ALLOCATION.......................................27
4.1 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION........................27
4.2 TIME OF PAYMENT OF EMPLOYER'S CONTRIBUTION.............................27
4.3 ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS...................28
4.4 MAXIMUM ANNUAL ADDITIONS...............................................34
4.5 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS..............................40
4.6 TRANSFERS FROM QUALIFIED PLANS.........................................41
4.7 VOLUNTARY CONTRIBUTIONS................................................42
4.8 DIRECTED INVESTMENT ACCOUNT............................................43
4.9 QUALIFIED VOLUNTARY EMPLOYEE CONTRIBUTIONS.............................44
4.10 ACTUAL CONTRIBUTION PERCENTAGE TESTS..................................44
4.11 INTEGRATION IN MORE THAN ONE PLAN.....................................44
ARTICLE V: VALUATIONS.........................................................46
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5.1 VALUATION OF THE TRUST FUND............................................46
5.2 METHOD OF VALUATION....................................................46
ARTICLE VI: DETERMINATION AND DISTRIBUTION OF BENEFITS........................47
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT..............................47
6.2 DETERMINATION OF BENEFITS UPON DEATH...................................47
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY.......................48
6.4 DETERMINATION OF BENEFITS UPON TERMINATION.............................48
6.5 DISTRIBUTION OF BENEFITS...............................................52
6.6 DISTRIBUTION OF BENEFITS UPON DEATH....................................56
6.7 TIME OF SEGREGATION OR DISTRIBUTION....................................61
6.8 DISTRIBUTION FOR MINOR BENEFICIARY.....................................61
6.9 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN.........................61
6.10 PRE-RETIREMENT DISTRIBUTION...........................................61
6.11 ADVANCE DISTRIBUTION FOR HARDSHIP.....................................62
6.12 LIMITATIONS ON BENEFITS AND DISTRIBUTIONS.............................62
6.13 SPECIAL RULE FOR NON-ANNUITY PLANS....................................63
ARTICLE VII: TRUSTEE..........................................................65
7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE..................................65
7.2 INVESTMENT POWERS AND DUTIES OF THE TRUSTEE............................65
7.3 OTHER POWERS OF THE TRUSTEE............................................66
7.4 LOANS TO PARTICIPANTS..................................................69
7.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS...............................71
7.6 TRUSTEE'S COMPENSATION AND EXPENSES AND TAXES..........................71
7.7 ANNUAL REPORT OF THE TRUSTEE...........................................72
7.8 AUDIT..................................................................72
7.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE.........................73
7.10 TRANSFER OF INTEREST..................................................74
7.11 TRUSTEE INDEMNIFICATION...............................................74
7.12 EMPLOYER SECURITIES AND REAL PROPERTY.................................75
ARTICLE VIII: AMENDMENT, TERMINATION, AND MERGERS.............................76
8.1 AMENDMENT..............................................................76
8.2 TERMINATION............................................................77
8.3 MERGER OR CONSOLIDATION................................................77
ARTICLE IX: MISCELLANEOUS.....................................................78
9.1 EMPLOYER ADOPTIONS.....................................................78
9.2 PARTICIPANT'S RIGHTS...................................................78
9.3 ALIENATION.............................................................78
9.4 CONSTRUCTION OF PLAN...................................................79
9.5 GENDER AND NUMBER......................................................79
9.6 LEGAL ACTION...........................................................79
9.7 PROHIBITION AGAINST DIVERSION OF FUNDS.................................79
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9.8 BONDING................................................................80
9.10 INSURER'S PROTECTIVE CLAUSE...........................................80
9.11 RECEIPT AND RELEASE FOR PAYMENTS......................................80
9.12 ACTION BY THE EMPLOYER................................................80
9.13 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY....................81
9.14 HEADINGS..............................................................81
9.15 APPROVAL BY INTERNAL REVENUE SERVICE..................................81
9.16 UNIFORMITY............................................................82
9.17 PAYMENT OF BENEFITS...................................................82
ARTICLE X: PARTICIPATING EMPLOYERS............................................83
10.1 ELECTION TO BECOME A PARTICIPATING EMPLOYER...........................83
10.2 REQUIREMENTS OF PARTICIPATING EMPLOYERS...............................83
10.3 DESIGNATION OF AGENT..................................................83
10.4 EMPLOYEE TRANSFERS....................................................83
10.5 PARTICIPATING EMPLOYER'S CONTRIBUTION AND FORFEITURES.................84
10.6 AMENDMENT.............................................................84
10.7 DISCONTINUANCE OF PARTICIPATION.......................................84
10.8 ADMINISTRATOR'S AUTHORITY.............................................84
10.9 PARTICIPATING EMPLOYER CONTRIBUTION FOR AFFILIATE.....................85
ARTICLE XI: CASH OR DEFERRED PROVISIONS.......................................86
11.1 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION.......................86
11.2 PARTICIPANT'S SALARY REDUCTION ELECTION...............................87
11.3 ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS..................91
11.4 ACTUAL DEFERRAL PERCENTAGE TESTS......................................93
11.5 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS........................95
11.6 ACTUAL CONTRIBUTION PERCENTAGE TESTS..................................99
11.7 ADJUSTMENT TO ACTUAL CONTRIBUTION PERCENTAGE TESTS...................102
11.8 ADVANCE DISTRIBUTION FOR HARDSHIP....................................106
AMENDMENT....................................................................108
TRANSFER OF ASSETS FROM A MONEY PURCHASE PLAN.............................108
UNIFORMED SERVICES........................................................108
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ARTICLE I
DEFINITIONS
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As used in this Plan, the following words and phrases shall have the
meanings set forth herein unless a different meaning is clearly required by the
context:
1.1 "ACT" means the Employee Retirement Income Security Act of 1974, as it may
be amended from time to time.
1.2 "ADMINISTRATOR" means the person(s) or entity designated by the Employer
pursuant to Section 2.4 to administer the Plan on behalf of the Employer.
1.3 "ADOPTION AGREEMENT" means the separate Agreement which is executed by the
Employer and accepted by the Trustee which sets forth the elective provisions of
this Plan and Trust as specified by the Employer.
1.4 "AFFILIATED EMPLOYER" means the Employer and any corporation which is a
member of a controlled group of corporations (as defined in Code Section 414(b))
which includes the Employer; any trade or business (whether or not incorporated)
which is under common control (as defined in Code Section 414(c)) with the
Employer; any organization (whether or not incorporated) which is a member of an
affiliated service group (as defined in Code Section 414(m)) which includes the
Employer; and any other entity required to be aggregated with the Employer
pursuant to Regulations under Code Section 414(o).
1.5 "AGGREGATE ACCOUNT" means with respect to each Participant, the value of all
accounts maintained on behalf of a Participant, whether attributable to Employer
or Employee contributions, subject to the provisions of Section 2.2.
1.6 "ANNIVERSARY DATE" means the anniversary date specified in C3 of the
Adoption Agreement.
1.7 "BENEFICIARY" means the person to whom a share of a deceased Participant's
interest in the Plan is payable, subject to the restrictions of Sections 6.2 and
6.6.
1.8 "CODE" means the Internal Revenue Code of 1986, as amended or replaced from
time to time.
1.9 "COMPENSATION" with respect to any Participant means one of the following as
elected in the Adoption Agreement. However, Compensation for any Self-Employed
Individual shall be equal to his Earned Income.
(a) Information required to be reported under Sections 6041, 6051 and
6052 (wages, tips and other Compensation Box on Form W-2). Compensation
is defined as wages. as defined in Code Section 3401(a), and all other
payments of Compensation to an
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Employee by the Employer (in the course of the Employer's trade or
business) for which the Employer is required to furnish the Employee a
written statement under Code Sections 6041(d) and 6051(a)(3).
Compensation must be determined without regard to any rules under Code
Section 3401(a) that limit the remuneration included in wages based on
the nature or location of the employment or the services performed
(such as the exception for agricultural labor in Section 3401(a)(2)).
(b) Section 3401(a) wages. Compensation is defined as wages within the
meaning of Code Section 3401(a) for the purposes of income tax
withholding at the source but determined without regard to any rules
that limit the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the
exception for agricultural labor in Code Section 3401(a)(2)).
(c) 415 safe-harbor compensation. Compensation is defined as wages,
salaries, and fees for professional services and other amounts received
(without regard to whether or not an amount is paid in cash) for
personal services actually rendered in the course of employment with
the Employer maintaining the Plan to the extent that the amounts are
includible in gross income (including, but not limited to, commissions
paid salesmen, compensation for services on the basis of a percentage
of profits, commissions on insurance premiums, tips, bonuses, fringe
benefits, and reimbursements, or other expense allowances under a
non-accountable plan (as described in Regulation Section 1.62-2(c)),
and excluding the following:
(1) Employer contributions to a plan of deferred compensation
which are not includible in the Employee's gross income for
the taxable year in which contributed, or Employer
contributions under a simplified employee pension plan to the
extent such contributions are deductible by the Employee, or
any distributions from a plan of deferred compensation;
(2) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
(3) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock option,
and
(4) other amounts which received special tax benefits, or
contributions made by the Employer (whether or not under a
salary reduction agreement) towards the purchase of an annuity
contract described in section 403(b) of the Internal Revenue
Code (whether or not the contributions are actually excludable
from the gross income of the Employee).
If, in connection with the adoption of any amendment, the definition of
Compensation has been modified, then, for Plan Years prior to the Plan Year
which includes the adoption date of such amendment, Compensation means
compensation determined pursuant to the Plan then in
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effect.
In addition, if specified in the Adoption Agreement, Compensation for
all Plan purposes shall also include compensation which is not currently
includible in the Participant's gross income by reason of the application of
Code Sections 125, 402(a)(8), 402(h)(1)(B), or 403(b).
Compensation in excess of $200,000 shall be disregarded. Such amount
shall be adjusted at the same time and in such manner as permitted under Code
Section 415(d). In applying this limitation, the family group of a Highly
Compensated Participant who is subject to the Family Member aggregation rules of
Code Section 414(q)(6) because such Participant is either a "five percent owner"
of the Employer or one of the ten (10) Highly Compensated Employees paid the
greatest "415 Compensation" during the year, shall be treated as a single
Participant, except that for this purpose Family Members shall include only the
affected Participant's spouse and any lineal descendants who have not attained
age nineteen (19) before the close of the year. If, as a result of the
application of such rules. the adjusted $200,000 limitation is exceeded. then
(except for purposes of determining the portion of Compensation up to the
integration level if this plan is integrated), the limitation shall be prorated
among the affected individuals in proportion to each such individual's
Compensation as determined under this Section prior to the application of this
limitation.
For Plan Years beginning prior to January 1, 1989, the $200,000 limit
(without regard to Family Member aggregation) shall apply only for Top Heavy
Plan Years and shall not be adjusted.
In addition to other applicable limitations set forth in the Plan, and
notwithstanding any other provision of the Plan to the contrary, for Plan Years
beginning on or after January 1, 1994, the annual Compensation for each Employee
taken into account under the Plan shall not exceed the OBRA `93 annual
Compensation limit. The OBRA `93 annual Compensation limit is $150,000, as
adjusted by the Commissioner for increases in the cost of living in accordance
with Section 401(a)(17)(B) of the Internal Revenue Code. The cost-of-living
adjustment in effect for a calendar year applies to any period, not exceeding 12
months, over which Compensation is determined (determination period) beginning
in such calendar year. If a determination period consists of fewer than 12
months, the OBRA `93 annual Compensation limit will be multiplied by a fraction,
the numerator of which is the number of months in the determination period, and
the denominator of which is 12.
For Plan Years beginning on or after January 1, 1994, any reference in
this Plan to the limitation under Section 401(a)(17) of the Code shall mean the
OBRA `93 annual Compensation limit set forth in this provision.
If Compensation for any prior determination period is taken into
account in determining an Employee's benefits accruing in the current Plan Year,
the Compensation for that prior determination period is subject to the OBRA `93
Compensation limit in effect for that prior determination period. For this
purpose, for determination periods beginning before the First day of the Plan
Year beginning on or after January 1, 1994, the OBRA `93 annual Compensation
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limit is $150,000.
1.10 "CONTRACT" OR "POLICY" means any life insurance policy, retirement income
policy, or annuity contract (group or individual) issued by the Insurer. In the
event of any conflict between the terms of this Plan and the terms of any
insurance contract purchased hereunder, the Plan provisions shall control.
1.11 "DEFERRED COMPENSATION" means, with respect to any Participant, that
portion of the Participant's total Compensation which has been contributed to
the Plan in accordance with the Participant's deferral election pursuant to
Section 11.2.
1.12 "EARLY RETIREMENT DATE" means the date specified in the Adoption Agreement
on which a Participant or Former Participant has satisfied the age and service
requirements specified in the Adoption Agreement (Early Retirement Age). A
Participant shall become fully Vested upon satisfying this requirement if still
employed at his Early Retirement Age.
A Former Participant who terminates employment after satisfying the
service requirement for Early Retirement and who thereafter reaches the age
requirement contained herein shall be entitled to receive his benefits under
this Plan.
1.13 "EARNED INCOME" means with respect to a Self-Employed Individual, the net
earnings from self-employment in the trade or business with respect to which the
Plan is established, for which the personal services of the individual are a
material income-producing factor. Net earnings will be determined without regard
to items not included in gross income and the deductions allocable to such
items. Net earnings are reduced by contributions by the Employer to a qualified
Plan to the extent deductible under Code Section 404. In addition. for Plan
Years beginning after December 31, 1989, net earnings shall be determined with
regard to the deduction allowed to the Employer by Code Section 164(f).
1.14 "ELECTIVE CONTRIBUTION" means the Employer's contributions to the Plan that
are made pursuant to the Participant's deferral election pursuant to Section
11.2, excluding any such amounts distributed as "excess annual additions"
pursuant to Section 4.4. In addition, if selected in E3 of the Adoption
Agreement. the Employer's matching contribution made pursuant to Section 11.1(b)
shall or shall not be considered an Elective Contribution for purposes of the
Plan, as provided in Section 11.1(b), Elective Contributions shall be subject to
the requirements of Sections 11.2(b) and 11.2(c) and shall further be required
to satisfy the discrimination requirements of Regulation 1.401(k)-l(b)(3), the
provisions of which are specifically incorporated herein by reference.
1.15 "ELIGIBLE EMPLOYEE" means any Employee specified in DI of the Adoption
Agreement.
1.16 "EMPLOYEE" means any person who is employed by the Employer, but excludes
any person who is employed as an independent contractor. The term Employee shall
also include Leased Employees as provided in Code Section 414(n) or (o).
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Except as provided in the Non-Standardized Adoption Agreement, all
Employees of all entities which are an Affiliated Employer will be treated as
employed by a single employer.
1.17 "EMPLOYER" means the entity specified in the Adoption Agreement, any
Participating Employer (as defined in Section 10.1) which shall adopt this Plan,
any successor which shall maintain this Plan and any predecessor which has
maintained this Plan.
1.18 "EXCESS COMPENSATION" means, with respect to a Plan that is integrated with
Social Security, a Participant's Compensation which is in excess of the amount
set forth in the Adoption Agreement.
1.19 "EXCESS CONTRIBUTIONS" means, with respect to a Plan Year, the excess of
Elective Contributions and Qualified Non-Elective Contributions made on behalf
of Highly Compensated Participants for the Plan Year over the maximum amount of
such contributions permitted under Section 11.4(a).
1.20 "EXCESS DEFERRED COMPENSATION" means, with respect to any taxable year of a
Participant, the excess of the aggregate amount of such Participant's Deferred
Compensation and the elective deferrals pursuant to Section 11.2(f) actually
made on behalf of such Participant for such taxable year, over the dollar
limitation provided for in Code Section 402(g), which is incorporated herein by
reference. Excess Deferred Compensation shall be treated as an "annual addition"
pursuant to Section 4.4 when contributed to the Plan unless distributed to the
affected Participant not later than the first April 15th following the close of
the Participant's taxable year.
1.21 "FAMILY MEMBER" means, with respect to an affected Participant, such
Participant's spouse, and such Participant's lineal descendants and ascendants
and their spouses, all as described in Code Section 414(q)(6)(B).
1.22 "FIDUCIARY" means any person who (a) exercises any discretionary authority
or discretionary control respecting management of the Plan or exercises any
authority or control respecting management or disposition of its assets, (b)
renders investment advice for a fee or other compensation, direct or indirect,
with respect to any monies or other property of the Plan or has any authority or
responsibility to do so, or (c) has any discretionary authority or discretionary
responsibility in the administration of the Plan, including, but not limited to,
the Trustee, the Employer and its representative body, and the Administrator.
1.23 "FISCAL YEAR" means the Employer's accounting year as specified in the
Adoption Agreement.
1.24 "FORFEITURE" means that portion of a Participant's Account that is not
Vested, and occurs on the earlier of:
(a) the distribution of the entire Vested portion of a Participant's
Account. or
(b) the last day of the Plan Year in which the Participant incurs five
(5) consecutive
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1-Year Breaks in Service.
Furthermore, for purposes of paragraph (a) above, in the case of a
Terminated Participant whose Vested benefit is zero, such Terminated Participant
shall be deemed to have received a distribution of his Vested benefit upon his
termination of employment. In addition, the term Forfeiture shall also include
amounts deemed to be Forfeitures pursuant to any other provision of this Plan.
1.25 "FORMER PARTICIPANT" means a person who has been a Participant, but who has
ceased to be a Participant for any reason.
1.26 "414(s) COMPENSATION" with respect to any Employee means his Compensation
as defined in Section 1.9. However, for purposes of this Section, Compensation
shall be Compensation paid and, if selected in the Adoption Agreement, shall
only be recognized as of an Employee's effective date of participation. If, in
connection with the adoption of any amendment, the definition of "414(s)
Compensation" has been modified, then for Plan Years prior to the Plan Year
which includes the adoption date of such amendment, "414(s) Compensation" means
compensation determined pursuant to the Plan Year in effect.
1.27 "415 COMPENSATION" means compensation as defined in Section 4.4(f)(2).
If, in connection with the adoption of any amendment, the definition of
"415 Compensation" has been modified, then, for Plan Years prior to the Plan
Year which includes the adoption date of such amendment, "415 Compensation"
means compensation determined pursuant to the Plan then in effect.
1.28 "HIGHLY COMPENSATED EMPLOYEE" means an Employee described in Code Section
414(q) and the Regulations thereunder and generally means an Employee who
performed services for the Employer during the "determination year" and is in
one or more of the following groups:
(a) Employees who at any time during the "determination year" or
"look-back year" were "five percent owners" as defined in Section
1.35(c).
(b) Employees who received "415 Compensation" during the "look-back
year" from the Employer in excess of $75,000.
(c) Employees who received "415 Compensation" during the "look-back
year" from the Employer in excess of $50,000 and were in the Top Paid
Group of Employees for the Plan Year.
(d) Employees who during the "look-back year" were officers of the
Employer (as that term is defined within the meaning of the Regulations
under Code Section 416) and received "415 Compensation" during the
"look-back year" from the Employer greater than 50 percent of the limit
in effect under Code Section 415(b)(1)(A) for any such Plan
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Year. The number of officers shall be limited to the lesser of (i) 50
employees; or (ii) the greater of 3 employees or 10 percent of all
employees. If the Employer does not have at least one officer whose
annual "415 Compensation" is in excess of 50 percent of the Code
Section 415(b)(1)(A) limit, then the highest paid officer of the
Employer will be treated as a Highly Compensated Employee.
(e) Employees who are in the group consisting of the 100 Employees paid
the greatest "415 Compensation" during the "determination year" and are
also described in (b), (c) or (d) above when these paragraphs are
modified to substitute "determination year" for "look-back year."
The "determination year" shall be the Plan Year for which testing is
being performed, and the "look-back year" shall be the immediately preceding
twelve-month period. However, if the Plan Year is a calendar year, or if another
Plan of the Employer so provides, then the "look-back year" shall be the
calendar year ending with or within the Plan Year for which testing is being
performed, and the "determination year" (if applicable) shall be the period of
time, if any, which extends beyond the "look-back year" and ends on the last day
of the Plan Year for which testing is being performed (the "lag period"). With
respect to this election, it shall be applied on a uniform and consistent basis
to all plans, entities, and arrangements of the Employer.
For purposes of this Section, the determination of "415 Compensation"
shall be made by including amounts that would otherwise be excluded from a
Participant's gross income by reason of the application of Code Sections 125,
402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made pursuant
to a salary reduction agreement, Code Section 403(b). Additionally, the dollar
threshold amounts specified in (b) and (c) above shall be adjusted at such time
and in such manner as is provided in Regulations. In the case of such an
adjustment, the dollar limits which shall be applied are those for the calendar
year in which the "determination year" or "look back year" begins.
In determining who is a Highly Compensated Employee, Employees who are
non-resident aliens and who received no earned income (within the meaning of
Code Section 911(d)) from the Employer constituting United States source income
within the meaning of Code Section 861(a)(3) shall not be treated as Employees.
Additionally, all Affiliated Employers shall be taken into account as a single
employer and Leased Employees within the meaning of Code Sections 414(n)(2) and
414(o)(2) shall be considered Employees unless such Leased Employees are covered
by a plan described in Code Section 414(n)(5) and are not covered in any
qualified plan maintained by the Employer. The exclusion of Leased Employees for
this purpose shall be applied on a uniform and consistent basis for all of the
Employer's retirement plans. In addition, Highly Compensated Former Employees
shall be treated as Highly Compensated Employees without regard to whether they
performed services during the "determination year."
1.29 "HIGHLY COMPENSATED FORMER EMPLOYEE" means a former Employee who had a
separation year prior to the "determination year" and was a Highly Compensated
Employee in the year of separation from service or in any "determination year"
after attaining age 55. Notwithstanding the foregoing, an Employee who separated
from service prior to 1987 will be
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treated as a Highly Compensated Former Employee only if during the separation
year (or year preceding the separation year) or any year after the Employee
attains age 55 (or the last year ending before the Employee's 55th birthday),
the Employee either received "415 Compensation" in excess of $50,000 or was a
"five percent owner." For purposes of this Section, "determination year," "415
Compensation" and "five percent owner" shall be determined in accordance with
Section 1.28. Highly Compensated Former Employees shall be treated as Highly
Compensated Employees. The method set forth in this Section for determining who
is a "Highly Compensated Former Employee" shall be applied on a uniform and
consistent basis for all purposes for which the Code Section 414(q) definition
is applicable.
1.30 "HIGHLY COMPENSATED PARTICIPANT" means any Highly Compensated Employee who
is eligible to participate in the Plan.
1.31 "HOUR OF SERVICE" means (1) each hour for which an Employee is directly or
indirectly compensated or entitled to compensation by the Employer for the
performance of duties during the applicable computation period; (2) each hour
for which an Employee is directly or indirectly compensated or entitled to
compensation by the Employer (irrespective of whether the employment
relationship has terminated.) for reasons other than performance of duties (such
as vacation, holidays, sickness, jury duty, disability, lay-off, military duty
or leave of absence) during the applicable computation period; (3) each hour for
which back pay is awarded or agreed to by the Employer without regard to
mitigation of damages. The same Hours of Service shall not be credited both
under (1) or (2), as the case may be, and under (3).
Notwithstanding the above, (i) no more than 501 Hours of Service are
required to be credited to an Employee on account of any single continuous
period during which the Employee performs no duties (whether or not such period
occurs in a single computation period); (ii) an hour for which an Employee is
directly or indirectly paid, or entitled to payment, on account of a period
during which no duties are performed is not required to be credited to the
Employee if such payment is made or due under a plan maintained solely for the
purpose of complying with applicable worker's compensation, or unemployment
compensation or disability insurance laws; and (iii) Hours of Service are not
required to be credited for a payment which solely reimburses an Employee for
medical or medically related expenses incurred by the Employee.
For purposes of this Section, a payment shall be deemed to be made by
or due from the Employer regardless of whether such payment is made by or due
from the Employer directly, or indirectly through, among others, a trust fund,
or insurer, to which the Employer contributes or pays premiums and regardless of
whether contributions made or due to the trust fund, insurer, or other entity
are for the benefit of particular Employees or are on behalf of a group of
Employees in the aggregate.
An Hour of Service must be counted for the purpose of determining a
Year of Service, a year of participation for purposes of accrued benefits, a
1-Year Break in Service, and employment commencement date (or reemployment
commencement date). The provisions of Department of Labor regulations
2530.200b-2(b) and (c) are incorporated herein by reference.
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Hours of Service will be credited for employment with all Affiliated
Employers and for any individual considered to be a Leased Employee pursuant to
Code Sections 414(n) or 414(o) and the Regulations thereunder.
Hours of Service will be determined on the basis of the method selected
in the Adoption Agreement.
1.32 "INSURER" means any legal reserve insurance company which shall issue one
or more policies under the Plan.
1.33 "INVESTMENT MANAGER" means an entity that (a) has the power to manage,
acquire, or dispose of Plan assets and (b) acknowledges fiduciary responsibility
to the Plan in writing. Such entity must be a person, firm, or corporation
registered as an investment adviser under the Investment Advisers Act of 1940, a
bank, or an insurance company.
1.34 "JOINT AND SURVIVOR ANNUITY" means an annuity for the life of a Participant
with a survivor annuity for the life of the Participant's spouse which is not
less than 1/2, nor greater than the amount of the annuity payable during the
joint lives of the Participant and the Participant's spouse. The Joint and
Survivor Annuity will be the amount of benefit which can be purchased with the
Participant's Vested interest in the Plan.
1.35 "KEY EMPLOYEE" means an Employee as defined in Code Section 416(i) and the
Regulations thereunder. Generally, any Employee or former Employee (as well as
each of his Beneficiaries) is considered a Key Employee if he, at any time
during the Plan Year that contains the "Determination Date" or any of the
preceding four (4) Plan Years, has been included in one of the following
categories:
(a) an officer of the Employer (as that term is defined within the
meaning of the Regulations under Code Section 416) having annual "415
Compensation" greater than 50 percent of the amount in effect under
Code Section 415(b)( 1)(A) for any such Plan Year.
(b) one of the ten employees having annual "415 Compensation" from the
Employer for a Plan Year greater than the dollar limitation in effect
under Code Section 415(c)(1)(A) for the calendar year in which such
Plan Year ends and owning (or considered as owning within the meaning
of Code Section 318) both more than one-half percent interest and the
largest interests in the Employer.
(c) a "five percent owner" of the Employer. "five percent owner" means
any person who owns (or is considered as owning within the meaning of
Code Section 318) more than five percent (5%) of the outstanding stock
of the Employer or stock possessing more than five percent (5%) of the
total combined voting power of all stock of the Employer or, in the
case of an unincorporated business, any person who owns more than five
percent (5%) of the capital or profits interest in the Employer. In
determining percentage ownership hereunder, employers that would
otherwise be aggregated under Code Sections 414(b), (c), (m) and (o)
shall be treated as separate employers.
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(d) a "one percent owner" of the Employer having an annual "415
Compensation" from the Employer of more than $150,000. "One percent
owner" means any person who owns (or is considered as owning within the
meaning of Code Section 318) more than one percent (1%) of the
outstanding stock of the Employer or stock possessing more than one
percent (1%) of the total combined voting power of all stock of the
Employer or, in the case of an unincorporated business, any person who
owns more than one percent (1 %) of the capital or profits interest in
the Employer. In determining percentage ownership hereunder, employers
that would otherwise be aggregated under Code Sections 414(b), (c), (m)
and (o) shall be treated as separate employers. However, in determining
whether an individual has "415 Compensation" of more than $150,000,
"415 Compensation" from each employer required to be aggregated under
Code Sections 414(b), (c), (m) and (o) shall be taken into account.
For purposes of this Section, the determination of "415 Compensation"
shall be made by including amounts that would otherwise be excluded from a
Participant's gross income by reason of the application of Code Sections 125,
402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made pursuant
to a salary reduction agreement, Code Section 403(b).
1.36 "LATE RETIREMENT DATE" means the date of, or the first day of the month or
the Anniversary Date coinciding with or next following, whichever corresponds to
the election made for the Normal Retirement Date, a Participant's actual
retirement after having reached his Normal Retirement Date.
1.37 "LEASED EMPLOYEE" means any person (other than an Employee of the
recipient) who pursuant to an agreement between the recipient and any other
person ("leasing organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with Code Section
414(n)(6)) on a substantially full time basis for a period of at least one year,
and such services are of a type historically performed by employees in the
business field of the recipient employer. Contributions or benefits provided a
leased employee by the leasing organization which are attributable to services
performed for the recipient employer shall be treated as provided by the
recipient employer.
A leased employee shall not be considered an Employee of the recipient
if, (i) such employee is covered by a money purchase pension plan providing: (1)
a nonintegrated employer contribution rate of at least 10 percent of
compensation, as defined in Code Section 415(c)(3), but including amounts
contributed pursuant to a salary reduction agreement which are excludable from
the employee's gross income under Code Sections 125, 402(a)(8), 402(h), or
403(b), (2) immediate participation, and (3) full and immediate vesting; and
(ii) leased employees do not constitute more than 20 percent of the recipient's
non-highly compensated workforce.
1.38 "NET PROFIT" means with respect to any Fiscal Year the Employer's net
income or profit for such Fiscal Year determined upon the basis of the
Employer's books of account in accordance with generally accepted accounting
principles, without any reduction for taxes based upon income. or for
contributions made by the Employer to this Plan and any other qualified
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plan.
1.39 "NON-ELECTIVE CONTRIBUTION" means the Employer's contributions to the Plan
other than those made pursuant to the Participant's deferral election made
pursuant to Section 11.2 and any Qualified Non-Elective Contribution. In
addition, if selected in E3 of the Adoption Agreement, the Employer's Matching
Contribution made pursuant to Section 4.3(b) shall be considered a Non-Elective
Contribution for purposes of the Plan.
1.40 "NON-HIGHLY COMPENSATED PARTICIPANT" means any Participant who is neither a
Highly Compensated Employee nor a Family Member.
1.41 "NON-KEY EMPLOYEE" means any Employee or former Employee (and his
Beneficiaries) who is not a Key Employee.
1.42 "NORMAL RETIREMENT AGE" means the age specified in the Adoption Agreement
at which time a Participant shall become fully Vested in his Participant's
Account.
1.43 "NORMAL RETIREMENT DATE" means the date specified in the Adoption Agreement
on which a Participant shall become eligible to have his benefits distributed to
him.
1.44 "1-YEAR BREAK IN SERVICE" means the applicable computation period during
which an Employee has not completed more than 500 Hours of Service with the
Employer. Further, solely for the purpose of determining whether a Participant
has incurred a 1-Year Break in Service, Hours of Service shall be recognized for
"authorized leaves of absence" and "maternity and paternity leaves of absence."
"Authorized leave of absence" means an unpaid, temporary cessation from
active employment with the Employer pursuant to an established nondiscriminatory
policy, whether occasioned by illness, military service, or any other reason.
A "maternity or paternity leave of absence" means, for Plan Years
beginning after December 31, 1984, an absence from work for any period by reason
of the Employee's pregnancy, birth of the Employee's child, placement of a child
with the Employee in connection with the adoption of such child, or any absence
for the purpose of caring for such child for a period immediately following such
birth or placement. For this purpose, Hours of Service shall be credited for the
computation period in which the absence from work begins, only if credit
therefore is necessary to prevent the Employee from incurring a 1-year break in
Service, or, in any other case, in the immediately following computation period.
The Hours of Service credited for a "maternity or paternity leave of absence"
shall be those which would normally have been credited but for such absence, or,
in any case in which the Administrator is unable to determine such hours
normally credited, eight (8) Hours of Service per day. The total Hours of
Service required to be credited for a "maternity or paternity leave of absence"
shall not exceed 501.
1.45 "OWNER-EMPLOYEE" means a sole proprietor who owns the entire interest in
the Employer or a partner who owns more than 10% of either the capital interest
or the profits
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interest in the Employer and who receives income for personal services from the
Employer.
1.46 "PARTICIPANT" means any Eligible Employee who participates in the Plan as
provided in Section 3.2 and has not for any reason become ineligible to
participate further in the Plan.
1.47 "PARTICIPANT'S ACCOUNT" means the account established and maintained by the
Administrator for each Participant with respect to his total interest under the
Plan resulting from (a) the Employer's contributions in the case of a Profit
Sharing Plan or Money Purchase Plan, and (b) the Employer's Non-Elective
Contributions in the case of a 401(k) Profit Sharing Plan.
1.48 "PARTICIPANT'S COMBINED ACCOUNT" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest under the Plan resulting from the Employer's contributions.
1.49 "PARTICIPANT'S ELECTIVE ACCOUNT" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan and Trust resulting from the Employer's Elective
Contributions and Qualified Non-Elective Contributions. A separate accounting
shall be maintained with respect to that portion of the Participant's Elective
Account attributable to Elective Contributions made pursuant to Section 11.2,
Employer matching contributions if they are deemed to be Elective Contributions,
and any Qualified Non-Elective Contributions.
1.50 "PARTICIPANT'S ROLLOVER ACCOUNT" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan resulting from amounts transferred from another qualified
plan or "conduit" Individual Retirement Account in accordance with Section 4.6.
1.51 "PLAN" means this instrument (hereinafter referred to as The Angell Pension
Group, Inc. Regional Prototype Defined Contribution Pension Plan and Trust Basic
Plan Document #01) including all amendments thereto, and the Adoption Agreement
as adopted by the Employer.
1.52 "PLAN YEAR" means the Plan's accounting year as specified in C2 of the
Adoption Agreement.
1.53 "PRE-RETIREMENT SURVIVOR ANNUITY" means an immediate annuity for the life
of the Participant's spouse, the payments under which must be equal to the
actuarial equivalent of 50% of the Participant's Vested interest in the Plan as
of the date of death.
1.54 "QUALIFIED NON-ELECTIVE ACCOUNT" means the account established hereunder to
which Qualified Non-Elective Contributions are allocated.
1.55 "QUALIFIED NON-ELECTIVE CONTRIBUTION" means the Employer's contributions to
the Plan that are made pursuant to E5 of the Adoption Agreement and Section
11.1(d) which are used to satisfy the "Actual Deferral Percentage" tests.
Qualified Non-Elective Contributions are non-forfeitable when made and are
distributable only as specified in Sections 11.2(c) and 11.8. In
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addition, the Employer's contributions to the Plan that are made pursuant to
Section 11.7(h) and which are used to satisfy the "Actual Contribution
Percentage" tests shall be considered Qualified Non-Elective Contributions.
1.56 "QUALIFIED VOLUNTARY EMPLOYEE CONTRIBUTION ACCOUNT" means the account
established and maintained by the Administrator for each Participant with
respect to his total interest under the Plan resulting from the Participant's
tax deductible qualified voluntary employee contributions made pursuant to
Section 4.9.
1.57 "REGULATION" means the Income Tax Regulations as promulgated by the
Secretary of the Treasury or his delegate, and as amended from time to time.
1.58 "RETIRED PARTICIPANT" means a person who has been a Participant, but who
has become entitled to retirement benefits under the Plan.
1.59 "RETIREMENT DATE" means the date as of which a Participant retires for
reasons other than Total and Permanent Disability, whether such retirement
occurs on a Participant's Normal Retirement Date, Early or Late Retirement Date
(see Section 6.1),
1.60 "SELF-EMPLOYED INDIVIDUAL" means an individual who has earned income for
the taxable year from the trade or business for which the Plan is established,
and, also, an individual who would have had earned income but for the fact that
the trade or business had no net profits for the taxable year. A Self-Employed
Individual shall be treated as an Employee.
1.61 "SHAREHOLDER-EMPLOYEE" means a Participant who owns more than five percent
(5%) of the Employer's outstanding capital stock during any year in which the
Employer elected to be taxed as a Small Business Corporation under the
applicable Code Section.
1.62 "SHORT PLAN YEAR" means, if specified in the Adoption Agreement, that the
Plan Year shall be less than a 12 month period. If chosen, the following rules
shall apply in the administration of this Plan. In determining whether an
Employee has completed a Year of Service for benefit accrual purposes in the
Short Plan Year, the number of the Hours of Service required shall be
proportionately reduced based on the number of days in the Short Plan Year. The
determination of whether an Employee has completed a Year of Service for vesting
and eligibility purposes shall be made in accordance with Department of Labor
Regulation 2530.203-2(c). In addition, if this Plan is integrated with Social
Security, the integration level shall also be proportionately reduced based on
the number of days in the Short Plan Year.
1.63 "SUPER TOP HEAVY PLAN" means a plan described in Section 2.2(b).
1.64 "TAXABLE WAGE BASE" means, with respect to any year, the maximum amount of
earnings which may be considered wages for such year under Code Section
3121(a)(1).
1.65 "TERMINATED PARTICIPANT" means a person who has been a Participant, but
whose employment has been terminated other than by death, Total and Permanent
Disability or
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retirement.
1.66 "TOP HEAVY PLAN" means a plan described in Section 2.2(a).
1.67 "TOP HEAVY PLAN YEAR" means a Plan Year commencing after December 31, 1983
during which the Plan is a Top Heavy Plan.
1.68 "TOP PAID GROUP" shall be determined pursuant to Code Section 414(q) and
the Regulations thereunder and generally means the top 20 percent of Employees
who performed services for the Employer during the applicable year, ranked
according to the amount of "415 Compensation" (as determined pursuant to Section
1.28) received from the Employer during such year. All Affiliated Employers
shall be taken into account as a single employer, and Leased Employees shall be
treated as Employees pursuant to Code Section 414(n) or (o). Employees who are
non-resident aliens who received no earned income (within the meaning of Code
Section 911(d)(2)) from the Employer constituting United States source income
within the meaning of Code Section 861(a)(3) shall not be treated as Employees.
Additionally, for the purpose of determining the number of active Employees in
any year, the following additional Employees shall also be excluded; however,
such Employees shall still be considered for the purpose of identifying the
particular Employees in the Top Paid Group:
(a) Employees with less than six (6) months of service;
(b) Employees who normally work less than 17 1/2 hours per week;
(c) Employees who normally work less than six (6) months during a year:
and
(d) Employees who have not yet attained age 21.
In addition, if 90 percent or more of the Employees of the Employer are
covered under agreements the Secretary of Labor finds to be collective
bargaining agreements between Employee representatives and the Employer, and the
Plan covers only Employees who are not covered under such agreements, then
Employees covered by such agreements shall be excluded from both the total
number of active Employees as well as from the identification of particular
Employees in the Top Paid Group.
The foregoing exclusions set forth in this Section shall be applied on
a uniform and consistent basis for all purposes for which The Code Section
414(q) definition is applicable.
1.69 "TOTAL AND PERMANENT DISABILITY" means the inability to engage in any
substantial gainful activity by reason of any medically determinable physical or
mental impairment that can be expected to result in death or which has lasted or
can be expected to last for a continuous period of not less than 12 months. The
disability of a Participant shall be determined by a licensed physician chosen
by the Administrator. However, if the condition constitutes total disability
under the federal Social Security Acts, the Administrator may rely upon such
determination that the Participant is Totally and Permanently Disabled for the
purposes of this
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Plan. The determination shall be applied uniformly to all Participants.
1.70 "TRUSTEE" means the person or entity named in B6 of the Adoption Agreement
and any successors.
1.71 "TRUST FUND" means the assets of the Plan and Trust as the same shall exist
from time to time.
1.72 "VESTED" means the non-forfeitable portion of any account maintained on
behalf of a Participant.
1.73 "VOLUNTARY CONTRIBUTION ACCOUNT" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan resulting from the Participant's nondeductible voluntary
contributions made pursuant to Section 4.7.
1.74 "YEAR OF SERVICE" means the computation period of twelve (12) consecutive
months, herein set forth, and during which an Employee has completed at least
1000 Hours of Service.
For purposes of eligibility for participation, the initial computation
period shall begin with the date on which the Employee first performs an Hour of
Service (employment commencement date). The computation period beginning after a
1-Year Break in Service shall be measured from the date on which an Employee
again performs an Hour of Service. The succeeding computation periods shall
begin with the first anniversary of the Employee's employment commencement date.
However, if one (1) Year of Service or less is required as a condition of
eligibility, then after the initial eligibility computation period, the
eligibility computation period shall shift to the current Plan Year which
includes the anniversary of the date on which the Employee first performed an
Hour of Service. An Employee who is credited with 1,000 Hours of Service in both
the initial eligibility computation period and the First Plan Year which
commences prior to the first anniversary of the Employee's initial eligibility
computation period will be credited with two Years of Service for purposes of
eligibility to participate.
For vesting purposes, and all other purposes not specifically addressed
in this Section, the computation period shall be the Plan Year, including
periods prior to the Effective Date of the Plan unless specifically excluded
pursuant to the Adoption Agreement.
Years of Service and breaks in service will be measured on the same
computation period.
Years of Service with any predecessor Employer which maintained this
Plan shall be recognized. Years of Service with any other predecessor Employer
shall be recognized as specified in the Adoption Agreement.
Years of Service with any Affiliated Employer shall be recognized.
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ARTICLE II
TOP HEAVY PROVISIONS AND ADMINISTRATION
2.1 TOP HEAVY PLAN REQUIREMENTS
For any Top Heavy Plan Year, the Plan shall provide the special vesting
requirements of Code Section 416(b) pursuant to Section 6.4 of the Plan and the
special minimum allocation requirements of Code Section 416(c) pursuant to
Section 4.3(i) of the Plan.
2.2 DETERMINATION OF TOP HEAVY STATUS
(a) This Plan shall be a Top Heavy Plan for any Plan Year beginning
after December 31, 1983, in which, as of the Determination Date, (1)
the Present Value of Accrued Benefits of Key Employees and (2) the sum
of the Aggregate Accounts of Key Employees under this Plan and all
plans of an Aggregation Group, exceeds sixty percent (60%) of the
Present Value of Accrued Benefits and the Aggregate Accounts of all Key
and Non-Key Employees under this Plan and all plans of an Aggregation
Group.
If any Participant is a Non-Key Employee for any Plan Year,
but such Participant was a Key Employee for any prior Plan Year, such
Participant's Present Value of Accrued Benefit and/or Aggregate Account
balance shall not be taken into account for purposes of determining
whether this Plan is a Top Heavy or Super Top Heavy Plan (or whether
any Aggregation Group which includes this Plan is a Top Heavy Group).
In addition, if a Participant or Former Participant has not performed
any services for any Employer maintaining the Plan at any time during
the five year period ending on the Determination Date, any accrued
benefit for such Participant or Former Participant shall not be taken
into account for the purposes of determining whether this Plan is a Top
Heavy or Super Top Heavy Plan.
(b) This Plan shall be a Super Top Heavy Plan for any Plan Year
beginning after December 31, 1983, in which, as of the Determination
Date, (1) the Present Value of Accrued Benefits of Key Employees and
(2) the sum of the Aggregate Accounts of Key Employees under this Plan
and all plans of an Aggregation Group, exceeds ninety percent (90%) of
the Present Value of Accrued Benefits and the Aggregate Accounts of all
Key and Non-Key Employees under this Plan and all plans of an
Aggregation Group.
(c) Aggregate Account: A Participant's Aggregate Account as of the
Determination Date is the sum of:
(1) his Participant's Combined Account balance as of the most
recent valuation occurring within a twelve (12) month period
ending on the Determination Date;
(2) for a Profit Sharing Plan, an adjustment for any
contributions due as of the Determination Date. Such
adjustment shall be the amount of any contributions
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actually made after the valuation date but before the
Determination Date, except for the First Plan Year when such
adjustment shall also reflect the amount of any contributions
made after the Determination Date that are allocated as of a
date in that first Plan Year:
(3) for a Money Purchase Plan, contributions that would be
allocated as of a date not later than the Determination Date.
even though those amounts are not yet made or required to be
made.
(4) any Plan distributions made within the Plan Year that
includes the Determination Date or within the four (4)
preceding Plan Years. However, in the case of distributions
made after the valuation date and prior to the Determination
Date, such distributions are not included as distributions for
top heavy purposes to the extent that such distributions are
already included in the Participant's Aggregate Account
balance as of the valuation date. In the case of a
distribution of an annuity Contract, the amount of such
distribution is deemed to be the current actuarial value of
the Contract, determined on the date of the distribution.
Notwithstanding anything herein to the contrary, all
distributions, including distributions made prior to January
1, 1984, and distributions under a terminated plan which if it
had not been terminated would have been required to be
included in an Aggregation Group, will be counted. Further,
distributions from the Plan (including the cash value of life
insurance policies) of a Participant's account balance because
of death shall be treated as a distribution for the purpose of
this paragraph.
(5) any Employee contributions, whether voluntary or
mandatory. However, amounts attributable to tax deductible
qualified voluntary employee contributions shall not be
considered to be a part of the Participant's Aggregate Account
balance.
(6) with respect to unrelated rollovers and plan-to-plan
transfers (ones which are both initiated by the Employee and
made from a plan maintained by one employer to a plan
maintained by another employer), if this Plan provides the
rollovers or plan-to-plan transfers, it shall always consider
such rollovers or plan-to-plan transfers as a distribution for
the purposes of this Section. If this Plan is the plan
accepting such rollovers or plan-to-plan transfers, it shall
not consider such rollovers or plan-to-plan transfers accepted
after December 31, 1983 as part of the Participant's Aggregate
Account balance. However, rollovers or plan-to-plan transfers
accepted prior to January 1, 1984 shall be considered as part
of the Participant's Aggregate Account balance.
(7) with respect to related rollovers and plan-to-plan
transfers (ones either not initiated by the Employee or made
to a plan maintained by the same employer), if this Plan
provides the rollover or plan-to-plan transfer, it shall not
be counted as a distribution for purposes of this Section. If
this Plan is the plan accepting such
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rollover or plan-to-plan transfer, it shall consider such
rollover or plan-to-plan transfer as part of the Participant's
Aggregate Account balance, irrespective of the date on which
such rollover or plan-to-plan transfer is accepted.
(8) For the purposes of determining whether two employers are
to be treated as the same employer in 2.2(c)(6) and 2.2(c)(7)
above, all employers aggregated under Code Section 414(b),
(c), W and (o) are treated as the same employer.
(d) "Aggregation Group" means either a Required Aggregation Group or a
Permissive Aggregation Group as hereinafter determined.
(1) Required Aggregation Group: In determining a Required
Aggregation Group hereunder, each qualified plan of the
Employer, including any Simplified Employee Pension Plan, in
which a Key Employee is a participant in the Plan Year
containing the Determination Date or any of the four preceding
Plan Years, and each other qualified plan of the Employer
which enables any qualified plan in which a Key Employee
participates to meet the requirements of Code Sections
401(a)(4) or 4 10, will be required to be aggregated. Such
group shall be known as a Required Aggregation Group.
In the case of a Required Aggregation Group, each
plan in the group will be considered a Top Heavy Plan if the
Required Aggregation Group is a Top Heavy Group. No plan in
the Required Aggregation Group will be considered a Top Heavy
Plan if the Required Aggregation Group is not a Top Heavy
Group.
(2) Permissive Aggregation Group: The Employer may also
include any other plan of the Employer, including any
Simplified Employee Pension Plan, not required to be included
in the Required Aggregation Group, provided the resulting
group, taken as a whole, would continue to satisfy the
provisions of Code Sections 401(a)(4) and 410. Such group
shall be known as a Permissive Aggregation Group.
In the case of a Permissive Aggregation Group, only a
plan that is part of the Required Aggregation Group will be
considered a Top Heavy Plan if the Permissive Aggregation
Group is a Top Heavy Group. No plan in the Permissive
Aggregation Group will be considered a Top Heavy Plan if the
Permissive Aggregation Group is not a Top Heavy Group.
(3) Only those plans of the Employer in which the
Determination Dates fall within the same calendar year shall
be aggregated in order to determine whether such plans are Top
Heavy Plans.
(4) An Aggregation Group shall include any terminated plan of
the Employer if it was maintained within the last five (5)
years ending on the Determination Date.
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(e) "Determination Date" means (a) the last day of the preceding Plan
Year, or (b) in the case of the first Plan Year, the last day of such
Plan Year.
(f) Present Value of Accrued Benefit: In the case of a defined benefit
plan, the Present Value of Accrued Benefit for a Participant other than
a Key Employee shall be as determined using the single accrual method
used for all plans of the Employer and Affiliated Employers, or if no
such single method exists, using a method which results in benefits
accruing not more rapidly than the slowest accrual rate permitted under
Code Section 411(b)(1)(C). The determination of the Present Value of
Accrued Benefit shall be determined as of the most recent valuation
date that falls within or ends with the 12-month period ending on the
Determination Date, except as provided in Code Section 416 and the
Regulations thereunder for the first and second plan years of a defined
benefit plan.
However, any such determination must include present value of
accrued benefit attributable to any Plan distributions referred to in
Section 2.2(c)(4) above, any Employee contributions referred to in
Section 2.2(c)(5) above or any related or unrelated rollovers referred
to in Sections 2.2(c)(6) and 2.2(c)(7) above.
(g) "Top Heavy Group" means an Aggregation Group in which, as of the
Determination Date, the sum of:
(1) the Present Value of Accrued Benefits of Key Employees
under all defined benefit plans included in the group, and
(2) the Aggregate Accounts of Key Employees under all defined
contribution plans included in the group,
exceeds sixty percent (60%) of a similar sum determined for all
Participants.
(h) The Administrator shall determine whether this Plan is a Top Heavy
Plan on the Anniversary Date specified in the Adoption Agreement. Such
determination of the top heavy ratio shall be in accordance with Code
Section 416 and the Regulations thereunder.
2.3 POWERS AND RESPONSIBILITIES OF THE EMPLOYER
(a) The Employer shall be empowered to appoint and remove the Trustee
and the Administrator from time to time as it deems necessary for the
proper administration of the Plan to assure that the Plan is being
operated for the exclusive benefit of the Participants and their
Beneficiaries in accordance with the terms of the Plan, the Code, and
the Act.
(b) The Employer shall establish a "funding policy and method," i.e.,
it shall determine whether the Plan has a short run need for liquidity
(e.g., to pay benefits) or
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whether liquidity is a long run goal and investment growth (and
stability of same) is a more current need, or shall appoint a qualified
person to do so. The Employer or its delegate shall communicate such
needs and goals to the Trustee, who shall coordinate such Plan needs
with its investment policy. The communication of such a "funding policy
and method" shall not, however, constitute a directive to the Trustee
as to investment of the Trust Funds. Such "funding policy and method"
shall be consistent with the objectives of this Plan and with the
requirements of Title I of the Act.
(c) The Employer may, in its discretion, appoint an Investment Manager
to manage all or a designated portion of the assets of the Plan. In
such event, the Trustee shall follow the directive of the Investment
Manager in investing the assets of the Plan managed by the Investment
Manager.
(d) The Employer shall periodically review the performance of any
Fiduciary or other person to whom duties have been delegated or
allocated by it under the provisions of this Plan or pursuant to
procedures established hereunder. This requirement may be satisfied by
formal periodic review by the Employer or by a qualified person
specifically designated by the Employer, through day-to-day conduct and
evaluation, or through other appropriate ways.
2.4 DESIGNATION OF ADMINISTRATIVE AUTHORITY
The Employer shall appoint one or more Administrators. Any person,
including, but not limited to, the Employees of the Employer, shall be eligible
to serve as an Administrator. Any person so appointed shall signify his
acceptance by filing written acceptance with the Employer. An Administrator may
resign by delivering his written resignation to the Employer or be removed by
the Employer by delivery of written notice of removal, to take effect at a date
specified therein, or upon delivery to the Administrator if no date is
specified.
The Employer, upon the resignation or removal of an Administrator,
shall promptly designate in writing a successor to this Position. If the
Employer does not appoint an Administrator. the Employer will function as the
Administrator.
2.5 ALLOCATION AND DELEGATION OF
If more than one person is appointed as Administrator, the
responsibilities of each Administrator may be specified by the Employer and
accepted in writing by each Administrator. In the event that no such delegation
is made by the Employer, the Administrators may allocate the responsibilities
among themselves, in which event the Administrators shall notify the Employer
and the Trustee in writing of such action and Specify the responsibilities of
each Administrator. The Trustee thereafter shall accept and rely upon any
documents executed by the appropriate Administrator until such time as the
Employer or the Administrators file with the Trustee a written revocation of
such designation.
2.6 POWERS AND DUTIES OF THE ADMINISTRATOR
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The primary responsibility of the Administrator is to administer the
Plan for the exclusive benefit of the Participants and their Beneficiaries,
subject to the specific terms of the Plan. The Administrator shall administer
the Plan in accordance with its terms and shall have the power and discretion to
construe the terms of the Plan and determine all questions arising in connection
with the administration, interpretation, and application of the Plan. Any such
determination by the Administrator shall be conclusive and binding upon all
persons. The Administrator may establish procedures, correct any defect, supply
any information, or reconcile any inconsistency in such manner and to such
extent as shall be deemed necessary or advisable to carry out the purpose of the
Plan; provided, however, that any procedure, discretionary act, interpretation
or construction shall be done in a nondiscriminatory manner based upon uniform
principles consistently applied and shall be consistent with the intent that the
Plan shall continue to be deemed a qualified plan under the terms of Code
Section 401(a), and shall comply with the terms of the Act and all regulations
issued pursuant thereto. The Administrator shall have all powers necessary or
appropriate to accomplish his duties under this Plan.
The Administrator shall be charged with the duties of the general
administration of the Plan, including, but not limited to, the following:
(a) the discretion to determine all questions relating to the
eligibility of Employees to participate or remain a Participant
hereunder and to receive benefits under the Plan;
(b) to compute, certify, and direct the Trustee with respect to the
amount and the kind of benefits to which any Participant shall be
entitled hereunder;
(c) to authorize and direct the Trustee with respect to all
non-discretionary or otherwise directed disbursements from the Trust
Fund;
(d) to maintain all necessary records for the administration of the
Plan;
(e) to interpret the provisions of the Plan and to make and publish
such rules for regulation of the Plan as are consistent with the terms
hereof;
(f) to determine the size and type of any Contract to be purchased from
any Insurer, and to designate the Insurer from which such Contract
shall be purchased;
(g) to compute and certify to the Employer and to the Trustee from time
to time the sums of money necessary or desirable to be contributed to
the Trust Fund;
(h) to consult with the Employer and the Trustee regarding the short
and long-term liquidity needs of the Plan in order that the Trustee can
exercise any investment discretion in a manner designed to accomplish
specific objectives;
(i) to prepare and distribute to Employees a procedure for notifying
Participants and Beneficiaries of their rights to elect Joint and
Survivor Annuities and Pre-Retirement
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Survivor Annuities if required by the Code and Regulations thereunder;
(j) to assist any Participant regarding his rights, benefits, or
elections available under the Plan.
2.7 RECORDS AND REPORTS
The Administrator shall keep a record of all actions taken and shall
keep all other books of account, records, and other data that may be necessary
for proper administration of the Plan and shall be responsible for supplying all
information and reports to the Internal Revenue Service, Department of Labor,
Participants, Beneficiaries and others as required by law.
2.8 APPOINTMENT OF ADVISERS
The Administrator, or the Trustee with the consent of the
Administrator, may appoint counsel, specialists, advisers, and other persons as
the Administrator or the Trustee deems necessary or desirable in connection with
the administration of this Plan.
2.9 INFORMATION FROM EMPLOYER
To enable the Administrator to perform his functions, the Employer
shall supply full and timely information to the Administrator on all matters
relating to the Compensation of all Participants, their Hours of Service, their
Years of Service, their retirement, death, disability, or termination of
employment, and such other pertinent facts as the Administrator may require; and
the Administrator shall advise the Trustee of such of the foregoing facts as may
be pertinent to the Trustee's duties under the Plan. The Administrator may rely
upon such information as is supplied by the Employer and shall have no duty or
responsibility to verify such information.
2.10 PAYMENT OF EXPENSES
All expenses of administration may be paid out of the Trust Fund unless
paid by the Employer. Such expenses shall include any expenses incident to the
functioning of the Administrator, including, but not limited to, fees of
accountants, counsel, and other specialists and their agents, and other costs of
administering the Plan. Until paid, the expenses shall constitute a liability of
the Trust Fund. However, the Employer may reimburse the Trust Fund for any
administration expense incurred. Any administration expense paid to the Trust
Fund as a reimbursement shall not be considered an Employer contribution.
2.11 MAJORITY ACTIONS
Except where there has been an allocation and delegation of
administrative authority pursuant to Section 2.5, if there shall be more than
one Administrator, they shall act by a majority of their number, but may
authorize one or more of them to sign all papers on their behalf.
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2.12 CLAIMS PROCEDURE
Claims for benefits under the Plan may be filed in writing with the
Administrator. Written notice of the disposition of a claim shall be furnished
to the claimant within 90 days after the application is filed. In the event the
claim is denied, the reasons for the denial shall be specifically set forth in
the notice in language calculated to be understood by the claimant, pertinent
provisions of the Plan shall be cited, and, where appropriate, an explanation as
to how the claimant can perfect the claim will be provided. In addition, the
claimant shall be furnished with an explanation of the Plan's claims review
procedure.
2.13 CLAIMS REVIEW PROCEDURE
Any Employee, former Employee, or Beneficiary of either, who has been
denied a benefit by a decision of the Administrator pursuant to Section 2.12
shall be entitled to request the Administrator to give further consideration to
his claim by filing with the Administrator a written request for a hearing. Such
request, together with a written statement of the reasons why the claimant
believes his claim should be allowed, shall be filed with the Administrator no
later than 60 days after receipt of the written notification provided for in
Section 2.12. The Administrator shall then conduct a hearing within the next 60
days, at which the claimant may be represented by an attorney or any other
representative of his choosing and expense and at which the claimant shall have
an opportunity to submit written and oral evidence and arguments in support of
his claim. At the hearing (or prior thereto upon 5 business days written notice
to the Administrator) the claimant or his representative shall have an
opportunity to review all documents in the possession of the Administrator which
are pertinent to the claim at issue and its disallowance. Either the claimant or
the Administrator may cause a court reporter to attend the hearing and record
the proceedings. In such event, a complete written transcript of the proceedings
shall be furnished to both parties by the court reporter. The full expense of
any such court reporter and such transcripts shall be borne by the party causing
the court reporter to attend the hearing. A final decision as to the allowance
of the claim shall be made by the Administrator within 60 days of receipt of the
appeal (unless there has been an extension of 60 days due to special
circumstances, provided the delay and the special circumstances occasioning it
are communicated to the claimant within the 60 day period). Such communication
shall be written in a manner calculated to be understood by the claimant and
shall include specific reasons for the decision and specific references to the
pertinent Plan provisions on which the decision is based.
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ARTICLE III
ELIGIBILITY
3.1 CONDITIONS OF ELIGIBILITY
Any Eligible Employee shall be eligible to participate hereunder on the
date he has satisfied the requirements specified in the Adoption Agreement.
3.2 EFFECTIVE DATE OF PARTICIPATION
An Eligible Employee who has become eligible to be a Participant shall
become a Participant effective as of the day specified in the Adoption
Agreement.
In the event an Employee who has satisfied the Plan's eligibility
requirements and would otherwise have become a Participant shall go from a
classification of a non-eligible Employee to an Eligible Employee, such Employee
shall become a Participant as of the date he becomes an Eligible Employee.
In the event an Employee who has satisfied the Plan's eligibility
requirements and would otherwise become a Participant shall go from a
classification of an Eligible Employee to a non-eligible Employee and becomes
ineligible to participate and has not incurred a 1-year break in Service, such
Employee shall participate in the Plan as of the date he returns to an eligible
class of Employees. If such Employee does incur a 1-Year Break in Service,
eligibility will be determined under the Break in Service rules of the Plan.
3.3 DETERMINATION OF ELIGIBILITY
The Administrator shall determine the eligibility of each Employee for
participation in the Plan based upon information furnished by the Employer. Such
determination shall be conclusive and binding upon all persons, as long as the
same is made pursuant to the Plan and the Act. Such determination shall be
subject to review per Section 2.13.
3.4 TERMINATION OF ELIGIBILITY
In the event a Participant shall go from a classification of an
Eligible Employee to an ineligible Employee, such Former Participant shall
continue to vest in his interest in the Plan for each Year of Service completed
while a non-eligible Employee, until such time as his Participant's Account
shall be forfeited or distributed pursuant to the terms of the Plan.
Additionally, his interest in the Plan shall continue to share in the earnings
of the Trust Fund.
3.5 OMISSION OF ELIGIBLE EMPLOYEE
If, in any Plan Year, any Employee who should be included as a
Participant in the Plan is erroneously omitted and discovery of such omission is
not made until after a contribution by his Employer for the year has been made,
the Employer shall make a subsequent contribution, if
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necessary after the application of Section 4.3(e), so that the omitted Employee
receives a total amount which the said Employee would have received had he not
been omitted. Such contribution shall be made regardless of whether or not it is
deductible in whole or in part in any taxable year under applicable provisions
of the Code.
3.6 INCLUSION OF INELIGIBLE EMPLOYEE
If, in any Plan Year, any person who should not have been included as a
Participant in the Plan is erroneously included and discovery of such incorrect
inclusion is not made until after a contribution for the year has been made, the
Employer shall not be entitled to recover the contribution made with respect to
the ineligible person regardless of whether or not a deduction is allowable with
respect to such contribution. In such event, the amount contributed with respect
to the ineligible person shall constitute a Forfeiture for the Plan Year in
which the discovery is made.
3.7 ELECTION NOT TO PARTICIPATE
An Employee may, subject to the approval of the Employer, elect
voluntarily not to participate in the Plan. The election not to participate must
be communicated to the Employer, in writing, at least thirty (30) days before
the beginning of a Plan Year. For Standardized Plans, a Participant or an
Eligible Employee may not elect not to participate. Furthermore, the foregoing
election not to participate shall not be available with respect to partners in a
partnership.
3.8 CONTROL OF ENTITIES BY OWNER-EMPLOYEE
(a) If this Plan provides contributions or benefits for one or more
Owner-Employees who control both the business for which this Plan is
established and one or more other entities, this Plan and the plan
established for other trades or businesses must, when looked at as a
single Plan, satisfy Code Sections 401(a) and (d) for the Employees of
this and all other entities.
(b) If the Plan provides contributions or benefits for one or more
Owner-Employees who control one or more other trades or businesses. the
employees of the other trades or businesses must be included in a plan
which satisfies Code Sections 401(a) and (d) and which provides
contributions and benefits not less favorable than provided for
Owner-Employees under this Plan.
(c) If an individual is covered as an Owner-Employee under the plans of
two or more trades or businesses which are not controlled and the
individual controls a trade or business, then the benefits or
contributions of the employees under the plan of the trades or
businesses which are controlled must be as favorable as those provided
for him under the most favorable plan of the trade or business which is
not controlled.
(d) For purposes of the preceding paragraphs, an Owner-Employee, or two
or more Owner-Employees, will be considered to control an entity if the
Owner-Employee, or two
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or more Owner-Employees together:
(1) own the entire interest in an unincorporated entity, or
(2) in the case of a partnership, own more than 50 percent of
either the capital interest or the profits interest in the
partnership.
(e) For purposes of the preceding sentence, an Owner-Employee, or two
or more Owner-Employees shall be treated as owning any interest in a
partnership which is owned, directly or indirectly, by a partnership
which such Owner-Employee, or such two or more Owner-Employees, are
considered to control within the meaning of the preceding sentence.
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ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.1 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION
(a) For a Money Purchase Plan:
(1) The Employer shall make contributions over such period of
years as the Employer may determine on the following basis. On
behalf of each Participant eligible to share in allocations,
for each year of his participation in this Plan, the Employer
shall contribute the amount specified in the Adoption
Agreement. All contributions by the Employer shall be made in
cash or in such property as is acceptable to the Trustee. The
Employer shall be required to obtain a waiver from the
Internal Revenue Service for any Plan Year in which it is
unable to make the full required contribution to the Plan. In
the event a waiver is obtained, this Plan shall be deemed to
be an individually designed plan.
(2) For any Plan Year beginning prior to January 1, 1990, and
if elected in the non-standardized Adoption Agreement for any
Plan Year beginning on or after January 1, 1990, the Employer
shall not contribute on behalf of a Participant who performs
less than a Year of Service during any Plan Year, unless there
is a Short Plan Year or a contribution is required pursuant to
4.3(h).
(3) Notwithstanding the foregoing, the Employer's contribution
for any Fiscal Year shall not exceed the maximum amount
allowable as a deduction to the Employer under the provisions
of Code Section 404. However, to the extent necessary to
provide the top heavy minimum allocations, the Employer shall
make a contribution even if it exceeds the amount which is
deductible under Code Section 404.
(b) For a Profit Sharing Plan:
(1) For each Plan Year, the Employer shall contribute to the
Plan such amount as specified by the Employer in the Adoption
Agreement. Notwithstanding the foregoing, however, the
Employer's contribution for any Fiscal Year shall not exceed
the maximum amount allowable as a deduction to the Employer
under the provisions of Code Section 404. All contributions by
the Employer shall be made in cash or in such property as is
acceptable to the Trustee.
(2) Except, however, to the extent necessary to provide the
top heavy minimum allocations, the Employer shall make a
contribution even if it exceeds current or accumulated Net
Profit or the amount which is deductible under Code Section
404.
4.2 TIME OF PAYMENT OF EMPLOYER'S CONTRIBUTION
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The Employer shall generally pay to the Trustee its contribution to the
Plan for each Plan Year within the time prescribed by law, including extensions
of time, for the filing of the Employer's federal income tax return for the
Fiscal Year.
4.3 ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS
(a) The Administrator shall establish and maintain an account in the
name of each Participant to which the Administrator shall credit as of
each Anniversary Date, or other valuation date, all amounts allocated
to each such Participant as set forth herein.
(b) The Employer shall provide the Administrator with all information
required by the Administrator to make a proper allocation of the
Employer's contributions for each Plan Year. within a reasonable period
of time after the date of receipt by the Administrator of such
information, the Administrator shall allocate such contribution as
follows:
(1) For a Money Purchase Plan:
(i) The Employer's Contribution shall be allocated to
each Participant's Combined Account in the manner set forth in
Section 4.1 herein and as specified in Section E2 of the
Adoption Agreement.
(2) For an Integrated Profit Sharing Plan:
(i) The Employer's contribution shall be allocated to
each Participant's Account, except as provided in
Section 4.3(f), in a dollar amount equal to 5.7% of
the sum of each Participant's total Compensation plus
Excess Compensation. If the Employer does not
contribute such amount for all Participants, each
Participant will be allocated a share of the
contribution in the same proportion that his total
Compensation plus his total Excess Compensation for
the Plan Year bears to the total Compensation plus
the total Excess Compensation of all Participants for
that year.
Regardless of the preceding, 4.3% shall be
substituted for 5.7% above if Excess Compensation is
based on more than 20% and less than or equal to 80%
of the Taxable Wage Base. If Excess Compensation is
based on less than 100% and more than 80% of the
Taxable Wage Base, then 5.4% shall be substituted for
5.7% above.
(ii) The balance of the Employer's contribution over
the amount allocated above, if any, shall be
allocated to each Participant's Combined Account in
the same proportion that his total Compensation for
the Year bears to the total Compensation of all
Participants for such year.
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(iii) Except, however, for any Plan Year beginning
prior to January 1, 1990, and if elected in the
non-standardized Adoption Agreement for any Plan Year
beginning on or after January, 1, 1990, a Participant
who performs less than a Year of Service during any
Plan Year shall not share in the Employer's
contribution for that year, unless there is a Short
Plan Year or a contribution is required pursuant to
Section 4.3(h).
(3) For a Non-Integrated Profit Sharing Plan:
(i) The Employer's contribution shall be allocated to
each Participant's Account in the same proportion
that each such Participant's Compensation for the
year bears to the total Compensation of 0
Participants for such year.
(ii) Except, however, for any Plan Year beginning
prior to January 1, 1990, and if elected in the
non-standardized Adoption Agreement for any Plan Year
beginning on or after January 1, 1990, a Participant
who performs less than a Year of Service during any
Plan Year shall not share in the Employer's
contribution for that year, unless there is a Short
Plan Year or a contribution is required pursuant to
Section 4.3(h).
(c) As of each Anniversary Date or other valuation date, before
allocation of Employer contributions and Forfeitures, any earnings or
losses (net appreciation or net depreciation) of the Trust Fund shall
be allocated in the same proportion that each Participant's and Former
Participant's non-segregated accounts bear to the total of all
Participants' and Former Participants' non-segregated accounts as of
such date. If any non-segregated account of a Participant has been
distributed prior to the Anniversary Date or other valuation date
subsequent to a Participant's termination of employment, no earnings or
losses shall be credited to such account.
Notwithstanding the above, with respect to contributions made
to the Plan after the previous Anniversary Date or allocation date, the
method specified in the Adoption Agreement shall be used.
(d) Participants' Accounts shall be debited for any insurance or
annuity premiums paid, if any, and credited with any dividends or
interest received on insurance contracts.
(e) As of each Anniversary Date any amounts which became Forfeitures
since the last Anniversary Date shall first be made available to
reinstate previously forfeited account balances of Former Participants,
if any, in accordance with Section 6.4(g)(2) or be used to satisfy any
contribution that may be required pursuant to Section 3.5 and/or 6.9.
The remaining Forfeitures, if any, shall be treated in accordance with
the Adoption Agreement. Provided, however, that in the event the
allocation of Forfeitures provided herein shall cause the "annual
addition" (as defined in Section 4.4) to any Participant's
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Account to exceed the amount allowable by the Code, the excess shall be
reallocated in accordance with Section 4.5. Except, however, for any
Plan Year beginning prior to January 1, 1990, and if elected in the
non-standardized Adoption Agreement for any Plan Year beginning on or
after January 1, 1990, a Participant who performs less than a Year of
Service during any Plan Year shall not share in the Plan Forfeitures
for that year, unless there is a Short Plan Year or a contribution
required pursuant to Section 4.3(h).
(f) Minimum Allocations Required for Top Heavy Plan Years:
Notwithstanding the foregoing, for any Top Heavy Plan Year, the sum of
the Employer's contributions and Forfeitures allocated to the
Participant's Combined Account of each Non-Key Employee shall be equal
to at least three percent (3%) of such Non-Key Employee's "415
Compensation" (reduced by contributions and forfeitures, if any,
allocated to each Non-Key Employee in any defined contribution plan
included with this plan in a Required Aggregation Group). However, if
(i) the sum of the Employer's contributions and Forfeitures allocated
to the Participant's Combined Account of each Key Employee for such Top
Heavy Plan Year is less than three percent (3%) of each Key Employee's
"415 Compensation" and (ii) this Plan is not required to be included in
an Aggregation Group to enable a defined benefit plan to Meet the
requirements of Code Section 401(a)(4) or 410, the sum of the
Employer's contributions and Forfeitures allocated to the Participant's
Combined Account of each Non-Key Employee shall be equal to the largest
percentage allocated to the Participant's Combined Account of any Key
Employee.
However, for each Non-Key Employee who is a Participant in a
paired Profit Sharing Plan or 401(k) Profit Sharing Plan and a paired
Money Purchase Plan, the minimum 3% allocation specified above shall be
provided in the Money Purchase Plan.
If this is an integrated Plan, then for any Top Heavy Plan
Year the Employer's contribution shall be allocated as follows:
(1) An amount equal to 3% multiplied by each Participant's
Compensation for the Plan Year shall be allocated to each
Participant's Account. If the Employer does not contribute
such amount for all Participants, the amount shall be
allocated to each Participant's Account in the same proportion
that his total Compensation for the Plan Year bears to the
total Compensation of all Participants for such year.
(2) The balance of the Employer's contribution over the amount
allocated under subparagraph (1) hereof shall be allocated to
each Participant's Account in a dollar amount equal to 3%
multiplied by a Participant's Excess Compensation. If the
Employer does not contribute such amount for all Participants,
each Participant will be allocated a share of the contribution
in the same proportion that his Excess Compensation bears to
the total Excess Compensation of all Participants for that
year.
(3) The balance of the Employer's contribution over the amount
allocated under subparagraph (2) hereof shall be allocated to
each Participant's Account in
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a dollar amount equal to 2.7% multiplied by the sum of each
Participant's total Compensation plus Excess Compensation. If
the Employer does not contribute such amount for all
Participants, each Participant will be allocated a share of
the contribution in the same proportion that his total
Compensation plus his total Excess Compensation for the Plan
Year bears to the total Compensation plus the total Excess
Compensation of all Participants for that year.
Regardless of the preceding, 1.3% shall be
substituted for 2.7% above if Excess Compensation is based on
more than 20% and less than or equal to 80% of the Taxable
Wage Base. If Excess Compensation is based on less than 100%
and more than 80% of the Taxable Wage Base, then 2.4% shall be
substituted for 2.7% above.
(4) The balance of the Employer's contributions over the
amount allocated above, if any, shall be allocated to each
Participant's Account in the same proportion that his total
Compensation for the Plan Year bears to the total Compensation
of all Participants for such year.
For each Non-Key Employee who is a Participant in
this Plan and another non-paired defined contribution plan
maintained by the Employer, the minimum 3% allocation
specified above shall be provided as specified in F3 of the
Adoption Agreement.
(g) For purposes of the minimum allocations set forth above. the
percentage allocated to the Participant's Combined Account of any Key
Employee shall be equal to the ratio of the sum of the Employer's
contributions and Forfeitures allocated on behalf of such Key Employee
divided by the "415 Compensation" for such Key Employee.
(h) For any Top Heavy Plan Year, the minimum allocations set forth in
this Section shall be allocated to the Participant's Combined Account
of all Non-Key Employees who are Participants and who are employed by
the Employer on the last day of the Plan Year, including Non-Key
Employees who have (1) failed to complete a Year of Service; or (2)
declined to make mandatory contributions (if required) or, in the case
of a cash or deferred arrangement, elective contributions to the Plan.
(i) Notwithstanding anything herein to the contrary, in any Plan Year
in which the Employer maintains both this Plan and a defined benefit
pension plan included in a Required Aggregation Group which is top
heavy, the Employer shall not be required to provide a Non-Key Employee
with both the full separate minimum defined benefit plan benefit and
the full separate defined contribution plan allocations. Therefore, if
the Employer maintains both a Defined Benefit and a Defined
Contribution Plan that are a Top Heavy Group, the top heavy minimum
benefits shall be provided as follows:
(1) Applies if Flb of the Adoption Agreement is Selected:
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(i) The requirements of Section 2.1 shall apply
except that each Non-Key Employee who is a
Participant in the Profit Sharing Plan or Money
Purchase Plan and who is also a Participant in the
Defined Benefit Plan shall receive a minimum
allocation of five percent (5%) of such Participant's
"415 Compensation" from the applicable Defined
Contribution Plan(s).
(ii) For each Non-Key Employee who is a Participant
only in the Defined Benefit Plan the Employer will
provide a minimum non-integrated benefit equal to 2%
of his highest five consecutive year average "415
Compensation" for each Year of Service while a
Participant in the Plan, in which the Plan is top
heavy, not to exceed ten.
(iii) For each Non-Key Employee who is a Participant
only in this Defined Contribution Plan, the Employer
shall provide a contribution equal to 3% of his "415
Compensation."
(2) Applies if Flc of the Adoption Agreement is Selected:
(i) The minimum allocation specified in Section
4.3(i)(00) shall be 7 1/2% if the Employer elects in
the Adoption Agreement for years in which the Plan is
Top Heavy, but not Super Top Heavy.
(ii) The minimum benefit specified in Section
4.3(i)(1)(ii) shall be 3% if the Employer elects in
the Adoption Agreement for years in which the Plan is
Top Heavy, but not Super Top Heavy.
(iii) The minimum allocation specified in Section
4.36)(1)(iii) shall be 4% if the Employer elects in
the Adoption Agreement for years in which the Plan is
Top Heavy, but not Super Top Heavy.
(j) For the purposes of this Section, "415 Compensation" shall be
limited to $200,000 (unless adjusted in such manner as permitted under
Code Section 415(d)). However, for Plan Years beginning prior to
January 1, 1989, the $200,000 limit shall apply only for Top Heavy Plan
Years and shall not be adjusted.
(k) Notwithstanding anything herein to the contrary, any Participant
who terminated employment during the Plan Year for reasons other than
death. Total and Permanent Disability, or retirement shall or shall not
share in the allocations of the Employer's Contributions and
Forfeitures as provided in the Adoption Agreement. Notwithstanding the
foregoing, for Plan Years beginning after 1989, if this is a
standardized Plan, any such terminated Participant shall share in the
allocations as provided in this Section provided such Participant
completed more than 500 Hours of Service.
(l) Notwithstanding anything herein to the contrary, Participants
terminating for
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reasons of death, Total and Permanent Disability, or retirement shall
share in the allocations as provided in this Section regardless of
whether they completed a Year of Service during the Plan Year.
(m) If a Former Participant is re-employed after five (5) consecutive
1-Year Breaks in Service, then separate accounts shall be maintained as
follows:
(1) one account for non-forfeitable benefits attributable to
pre-break service; and
(2) one account representing his employer derived account
balance in the Plan attributable to post-break service.
(n) Notwithstanding any election in the Adoption Agreement to the
contrary, if this is a non-standardized Plan that would otherwise fail
to meet the requirements of Code Sections 401(a)(26), 410(b)(1), or
410(b)(2)(A)(i) and the Regulations thereunder because Employer
Contributions have not been allocated to a sufficient number or
percentage of Participants for a Plan Year, then the following rules
shall apply:
(1) The group of Participants eligible to share in the
Employer's contribution and Forfeitures for the Plan Year
shall be expanded to include the minimum number of
Participants who would not otherwise be eligible as are
necessary to satisfy the applicable test specified above. The
specific participants who shall become eligible under the
terms of this paragraph shall be those who are actively
employed on the last day of the Plan Year and, when compared
to similarly situated Participants, have completed the
greatest number of Hours of Service in the Plan Year.
(2) If after application of paragraph (1) above, the
applicable test is still not satisfied, then the group of
Participants eligible to share in the Employer's contribution
and Forfeitures for the Plan Year shall be further expanded to
include the minimum number of Participants who are not
actively employed on the last day of the Plan Year as are
necessary to satisfy the applicable test. The specific
Participants who shall become eligible to share shall be those
Participants, when compared to similarly situated
Participants, who have completed the greatest number of Hours
of Service in the Plan Year before terminating employment.
Nothing in this Section shall permit the reduction of a
Participant's accrued benefit. Therefore any amounts that have
previously been allocated to Participants may not be reallocated to
satisfy these requirements. In such event, the Employer shall make an
additional contribution equal to the amount such affected Participants
would have received had they been included in the allocations. even if
it exceeds the amount which would be deductible under Code Section 404.
Any adjustment to the allocations pursuant to this paragraph shall be
considered a retroactive amendment adopted by the last day of the Plan
Year.
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4.4 MAXIMUM ANNUAL ADDITIONS
(a) (1) If the Participant does not participate in, and has never
participated in another qualified plan maintained by the
Employer, or a welfare benefit fund (as defined in Code
Section 419(c)), maintained by the Employer. or an individual
medical account (as defined in Code Section 415(1)(2))
maintained by the Employer, which provides Annual Additions,
the amount of Annual Additions which may be credited to the
Participant's accounts for any Limitation Year shall not
exceed the lesser of the Maximum Permissible Amount or any
other limitation contained in this Plan. If the Employer
contribution that would otherwise be contributed or allocated
to the Participant's accounts would cause the Annual Additions
for the Limitation Year to exceed the Maximum Permissible
Amount, the amount contributed or allocated will be reduced so
that the Annual Additions for the Limitation Year will equal
the Maximum Permissible Amount.
(2) Prior to determining the Participant's actual Compensation
for the Limitation Year, the Employer may determine the
Maximum Permissible Amount for a Participant on the basis of a
reasonable estimation of the Participant's Compensation for
the Limitation Year, uniformly determined for all Participants
similarly situated.
(3) As soon as is administratively feasible after the end of
the Limitation Year, the Maximum Permissible Amount for such
Limitation Year shall be determined on the basis of the
Participant's actual compensation for such Limitation Year.
(4) If there is an excess amount pursuant to Section 4.4(a)(2)
or Section 4.5, the excess will be disposed of in one of the
following manners, as uniformly determined by the Plan
Administrator for all Participants similarly situated:
(i) Any Deferred Compensation or nondeductible
Voluntary Employee Contributions, to the extent they
would reduce the Excess Amount, will be distributed
to the Participant;
(ii) If, after the application of subparagraph (i),
an Excess Amount still exists, and the Participant is
covered by the Plan at the end of the Limitation
Year, the Excess Amount in the Participant's account
will be used to reduce Employer contributions
(including any allocation of Forfeitures) for such
Participant in the next Limitation Year, and each
succeeding Limitation Year if necessary;
(iii) If, after the application of subparagraph (i),
an Excess Amount still exists. and the Participant is
not covered by the Plan at the end of a Limitation
Year, the Excess Amount will be held unallocated in a
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suspense account. The suspense account will be
applied to reduce future Employer contributions
(including allocation of any Forfeitures) for all
remaining Participants in the next Limitation Year,
and each succeeding Limitation Year if necessary;
(iv) If a suspense account is in existence at any
time during a Limitation Year pursuant to this
Section, it will not participate in the allocation of
investment gains and losses. If a suspense account is
in existence at any time during a particular
limitation year, all amounts in the suspense account
must be allocated and reallocated to participants'
accounts before any employer contributions or any
employee contributions may be made to the plan for
that ]imitation year. Excess amounts may not be
distributed to participants or former participants.
(b) (1) this subsection applies if, in addition to this Plan. the
Participant is covered under another qualified Regional
Prototype defined contribution plan maintained by the
Employer, or a welfare benefit fund (as defined in Code
Section 419(c)) maintained by the Employer, or an individual
medical account (as defined in Code Section 415(l)(2))
maintained by the Employer, which provides Annual Additions,
during any Limitation Year. The Annual Additions which may be
credited to a Participant's accounts under this Plan for any
such Limitation Year shall not exceed the Maximum Permissible
Amount reduced by the Annual Additions credited to a
Participant's accounts under the other plans and welfare
benefit funds for the same Limitation Year. If the Annual
Additions with respect to the Participant under other defined
contribution plans and welfare benefit funds maintained by the
Employer are less than the Maximum Permissible Amount and the
Employer contribution that would otherwise be contributed or
allocated to the Participant's accounts under this Plan would
cause the Annual Additions for the Limitation Year to exceed
this limitation, the amount contributed or allocated will be
reduced so that the Annual Additions under all such plans and
welfare benefit funds for the Limitation Year will equal the
Maximum Permissible Amount. If the Annual Additions with
respect to the Participant under such other defined
contribution plans and welfare benefit funds in the aggregate
are equal to or greater than the Maximum Permissible Amount,
no amount will be contributed or allocated to the
Participant's account under this Plan for the Limitation Year.
(2) Prior to determining the Participant's actual Compensation
for the Limitation Year, the Employer may determine the
Maximum Permissible Amount for a Participant in the manner
described in Section 4.4(a)(2).
(3) As soon as is administratively feasible after the end of
the Limitation Year, the Maximum Permissible Amount for the
Limitation Year will be determined on the basis of the
Participant's actual Compensation for the Limitation Year.
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(4) If, pursuant to Section 4.4(b)(2) or Section 4.5, a
Participant's Annual Additions under this Plan and such other
plans would result in an Excess Amount for a Limitation Year,
the Excess Amount will be deemed to consist of the Annual
Additions last allocated, except that Annual Additions
attributable to a welfare benefit fund or individual medical
account will be deemed to have been allocated first regardless
of the actual allocation date.
(5) If an Excess Amount was allocated to a Participant on an
allocation date of this Plan which coincides with an
allocation date of another plan, the Excess Amount attributed
to this Plan will be the product of:
(i) the total Excess Amount allocated as of such
date, times
(ii) the ratio of (1) the Annual Additions allocated
to the Participant for the Limitation Year as of such
date under this Plan to (2) the total Annual
Additions allocated to the Participant for the
Limitation Year as of such date under this and all
the other qualified defined contribution plans.
(6) Any Excess Amount attributed to this Plan will be disposed
in the manner described in Section 4.4(a)(4).
(c) If the Participant is covered under another qualified defined
contribution plan maintained by the Employer which is not a Regional
Prototype Plan, Annual Additions which may be credited to the
Participant's account under this Plan for any Limitation Year will be
limited in accordance with Section 4.4(b), unless the Employer provides
other limitations in the Adoption Agreement.
(d) If the Employer maintains, or at any time maintained, a qualified
defined benefit plan covering any Participant in this Plan the sum of:
the Participant's Defined Benefit Plan Fraction and Defined
Contribution Plan Fraction will not exceed 1.0 in any Limitation Year.
The Annual Additions which may be credited to the Participant's account
under this Plan for any Limitation Year will be limited in accordance
with the Limitation on Allocations Section of the Adoption Agreement.
(e) For purposes of applying the limitations of Code Section 415, the
Transfer of funds from one qualified plan to another is not an "annual
addition." In addition. the following are not Employee contributions
for the purposes of Section 4.4(f)(1)(2); (1) rollover contributions
(as defined in Code Sections 402(a)(5),403(a)(4),403(b)(8) and
408(d)(3)); (2) repayments of loans made to a Participant from the
Plan; (3) repayments of distributions received by an Employee pursuant
to Code Section 411(a)(7)(B) (cash-outs); (4) repayments of
distributions received by an Employee pursuant to Code Section
411(a)(3)(D) (mandatory contributions); and (5) Employee contributions
to a simplified employee pension excludable from gross income under
Code Section 408(k)(6).
(f) For purposes of this Section, the following terms shall be defined
as follows:
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(1) Annual Additions means the sum credited to a Participant's
accounts for any Limitation Year of (1) Employer
contributions, (2) effective with respect to "limitation
years" beginning after December 31, 1986, Employee
contributions, (3) forfeitures, (4) amounts allocated, after
March 31, 1984, to an individual medical account, as defined
in Code Section 415(l)(2), which is part of a pension or
annuity plan maintained by the Employer and (5) amounts
derived from contributions paid or accrued after December 31,
1985, in taxable years ending after such date, which are
attributable to post-retirement medical benefits allocated to
the separate account of a key employee (as defined in Code
Section 419A(d)(3)) under a welfare benefit fund (as defined
in Code Section 419(e)) maintained by the Employer. Except,
however, the "415 Compensation" percentage limitation referred
to in paragraph (a)(2) above shall not apply to: (1) any
contribution for medical benefits (within the meaning of Code
Section 419A(f)(2)) after separation from service which is
otherwise treated as an "annual addition," or (2) any amount
otherwise treated as an "annual addition" under Code Section
415(l)(1). Notwithstanding the foregoing, for "limitation
years" beginning prior to January 1, 1987, only that portion
of Employee contributions equal to the lesser of Employee
contributions in excess of six percent (6%) of "415
Compensation" or one-half of Employee contributions shall be
considered an "annual addition,"
For this purpose, any Excess Amount applied under
Sections 4.4(a)(4) and 4.4(b)(6) in the Limitation Year to
reduce Employer contributions shall be considered Annual
Additions for such Limitation Year.
(2) Compensation means a Participant's Compensation as elected
in the Adoption Agreement. However, regardless of any
selection made in the Adoption Agreement, "415 Compensation"
shall exclude compensation which is not currently includible
in the Participant's gross income by reason of the application
of Code Sections 125, 402(a)(8), 402(h)(1)(B), or 403(b).
For limitation years beginning after December 31,
1991, for purposes of applying the limitations of this
article, compensation for a limitation year is the
compensation actually paid or made available during such
limitation year.
Notwithstanding the preceding sentence, compensation
for a participant in a defined contribution plan who is
permanently and totally disabled (as defined in section
22(c)(3) of the Internal Revenue Code) is the compensation
such participant would have received for the limitation year
if the participant had been paid at the rate of compensation
paid immediately before becoming permanently and totally
disabled; such imputed compensation for the disabled
participant may be taken into account only if the participant
is not a Highly Compensated Employee and contributions made on
behalf of such participant are non-forfeitable when made.
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(3) Defined Benefit Fraction means a fraction, the numerator
of which is the sum of the Participant's Projected Annual
Benefits under all the defined benefit plans (whether or not
terminated) maintained by the Employer. and the denominator of
which is the lesser of 125 percent of the dollar limitation
determined for the Limitation Year under Code Sections 415(b)
and (d) or 140 percent of his Highest Average Compensation
including any adjustments under Code Section 415(b).
Notwithstanding the above, if the Participant was a
Participant as of the first day of the first Limitation Year
beginning after December 31, 1986, in one or more defined
benefit plans maintained by the Employer which were in
existence on May 6, 1986, the denominator of this fraction
will not be less than 125 percent of the sum of the annual
benefits under such plans which the Participant had accrued as
of the end of the close of the last Limitation Year beginning
before January 1, 1987, disregarding any changes in the terms
and conditions of the plan after May 5, 1986. The preceding
sentence applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements
of Code Section 415 for all Limitation Years beginning before
January 1, 1987.
Notwithstanding the foregoing, for any Top Heavy Plan
Year, 100 shall be substituted for 125 unless the extra
minimum allocation is being made pursuant to the Employer's
election in FI of the Adoption Agreement. However, for any
Plan Year in which this Plan is a Super Top Heavy Plan, 100
shall be substituted for 125 in any event.
(4) Defined Contribution Dollar Limitation means $30,000, or,
if greater, one-fourth of the defined benefit dollar
limitation set forth in Code Section 415(b)(1) as in effect
for the Limitation Year.
(5) Defined Contribution Fraction means a fraction, the
numerator of which is the sum of the Annual Additions to the
Participant's account under all the defined contribution plans
(whether or not terminated) maintained by the Employer for the
current and all prior Limitation Years, (including the Annual
Additions attributable to the Participant's nondeductible
voluntary employee contributions to any defined benefit plans,
whether or not terminated, maintained by the Employer and the
annual additions attributable to all welfare benefit funds, as
defined in Code Section 419(e), and individual medical
accounts, as defined in Code Section 415(l)(2), maintained by
the Employer), and the denominator of which is the sum of the
maximum aggregate amounts for the current and all prior
Limitation Years of Service with the Employer (regardless of
whether a defined contribution plan was maintained by the
Employer). The maximum aggregate amount in any Limitation Year
is the lesser of 125 percent of the Defined Contribution
Dollar Limitation or 35 percent of the Participant's
Compensation for such year. For Limitation Years beginning
prior to January 1, 1987, the
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"annual addition" shall not be recomputed to treat all
Employee contributions as an Annual Addition.
If the Employee was a Participant as of the end of
the first day of the First Limitation Year beginning after
December 31, 1986, in one or more defined contribution plans
maintained by the Employer which were in existence on May 5,
1986, the numerator of this fraction will be adjusted if the
sum of this fraction and the Defined Benefit Fraction would
otherwise exceed 1.0 under the terms of this Plan. Under the
adjustment, an amount equal to the product of (1) the excess
of the sum of the fractions over 1.0 times (2) the denominator
of this fraction, will be permanently subtracted from the
numerator of this fraction. The adjustment is calculated using
the fractions as they would be computed as of the end of the
last Limitation Year beginning before January 1, 1987, and
disregarding any changes in the terms and conditions of the
plan made after May 5, 1986, but using the Code Section 415
limitation applicable to the First Limitation Year beginning
on or after January 1, 1987.
Notwithstanding the foregoing, for any Top Heavy Plan
Year, 100 shall be substituted for 125 unless the extra
minimum allocation is being made pursuant to the Employer's
election in Fl of the Adoption Agreement. However, for any
Plan Year in which this Plan is a Super Top Heavy Plan, 100
shall be substituted for 125 in any event.
(6) Employer means the Employer that adopts this Plan and all
Affiliated Employers, except that for purposes of this
Section, Affiliated Employers shall be determined pursuant to
the modification made by Code Section 415(h).
(7) Excess Amount means the excess of the Participant's Annual
Additions for the Limitation Year over the Maximum Permissible
Amount.
(8) Highest Average Compensation means the average
Compensation for the three consecutive Years of Service with
the Employer that produces the highest average. A Year of
Service with the Employer is the 12 consecutive month period
defined in Section El of the Adoption Agreement which is used
to determine Compensation under the Plan.
(9) Limitation Year means the Compensation Year (a 12
consecutive month period) as elected by the Employer in the
Adoption Agreement. All qualified plans maintained by the
Employer must use the same Limitation Year. If the Limitation
Year is amended to a different 12 consecutive month period,
the new Limitation Year must begin on a date within the
Limitation Year in which the amendment is made.
(10) Maximum Permissible Amount means the maximum Annual
Addition that may be contributed or allocated to a
Participant's account under the plan for any
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44
Limitation Year, which shall not exceed the lesser of:
(i) the Defined Contribution Dollar Limitation, or
(ii) 25 percent of the Participant's Compensation for
the Limitation Year.
The Compensation Limitation referred to in
(ii) shall not apply to any contribution for medical
benefits (within the meaning of Code Sections 401(h)
or 419A(0(2)) which is otherwise treated as an annual
addition under Code Sections 415(l)(1) or 419A(d)(2).
If a short Limitation Year is created
because of an amendment changing the Limitation Year
to a different 12 consecutive month period, the
Maximum Permissible Amount will not exceed the
Defined Contribution Dollar Contribution multiplied
by the following fraction:
NUMBER OF MONTHS IN THE SHORT LIMITATION YEAR
12
(11) Projected Annual Benefit means the annual retirement
benefit (adjusted to an actuarially equivalent straight life
annuity if such benefit is expressed in a form other than a
straight life annuity or qualified Joint and Survivor Annuity)
to which the Participant would be entitled under the terms of
the plan assuming:
(i) the Participant will continue employment until
Normal Retirement Age (or current age, if later), and
(ii) the Participant's Compensation for the current
Limitation Year and all other relevant factors used
to determine benefits under the Plan will remain
constant for all future Limitation Years.
(g) Regional Prototype Plan means a plan the form of which has been the
subject of a favorable notification letter from the Internal Revenue
Service.
(h) Notwithstanding anything contained in this Section to the contrary,
the limitations, adjustments and other requirements prescribed in this
Section shall at all times comply with the provisions of Code Section
415 and the Regulations thereunder, the terms of which are specifically
incorporated herein by reference.
4.5 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS
(a) If as a result of the allocation of Forfeitures, a reasonable error
in estimating a Participant's annual Compensation, a reasonable error
in determining the amount of
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elective deferrals (within the meaning of Code Section 402(g)(3)) that
may be made with respect to any Participant under the limits of Section
4.4, or other facts and circumstances to which Regulation 1.415-6(b)(6)
shall be applicable, the "annual additions" under this Plan would cause
the maximum provided in Section 4.4 to be exceeded, the Administrator
shall treat the excess in accordance with Section 4.4(a)(4).
4.6 TRANSFERS FROM QUALIFIED PLANS
(a) If specified in the Adoption Agreement and with the consent of the
Administrator, amounts may be transferred from other qualified plans,
provided that the trust from which such funds are transferred permits
the transfer to be made and the transfer will not jeopardize the tax
exempt status of the Plan or create adverse tax consequences for the
Employer. The amounts transferred shall be set up in a separate account
herein referred to as a "Participant's Rollover Account." Such account
shall be fully Vested at all times and shall not be subject to
forfeiture for any reason.
(b) Amounts in a Participant's Rollover Account shall be held by the
Trustee pursuant to the provisions of this Plan and may not be
withdrawn by, or distributed to the Participant, in whole or in part,
except as provided in Paragraphs (c) and (d) of this Section.
(c) Amounts attributable to elective contributions (as defined in
Regulation 1.401(k)-1(g)(4)), including amounts treated as elective
contributions, which are transferred from another qualified plan in a
plan-to-plan transfer shall be subject to the distribution limitations
provided for in Regulation 1.401(k)-1(d).
(d) At Normal Retirement Date, or such other date when the Participant
or his Beneficiary shall be entitled to receive benefits, the fair
market value of the Participant's Rollover Account shall be used to
provide additional benefits to the Participant or his Beneficiary. Any
distributions of amounts held in a Participant's Rollover Account shall
be made in a manner which is consistent with and satisfies the
provisions of Section 6.5, including, but not limited to, all notice
and consent requirements of Code Sections 411(a)(11) and 417 and the
Regulations thereunder. Furthermore, such amounts shall be considered
as part of a Participant's benefit in determining whether an
involuntary cash-out of benefits without Participant consent may be
made.
(e) The Administrator may direct that employee transfers made after a
valuation date be segregated into a separate account for each
Participant. until such time as the allocations pursuant to this Plan
have been made, at which time they may remain segregated or be invested
as part of the general Trust Fund, to be determined by the
Administrator.
(f) For purposes of this Section, the term "qualified plan" shall mean
any tax qualified plan under Code Section 401(a). The term "amounts
transferred from other qualified plans" shall mean:
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(i) amounts transferred to this Plan directly from another
qualified plan;
(ii) lump-sum distributions received by an Employee from
another qualified plan which are eligible for tax free
rollover to a qualified plan and which are transferred by the
Employee to this Plan within sixty (60) days following his
receipt thereof;
(iii) amounts transferred to this Plan from a conduit
individual retirement account provided that the conduit
individual retirement account has no assets other than assets
which (A) were previously distributed to the Employee by
another qualified plan as a lump-sum distribution (B) were
eligible for tax-free rollover to a qualified plan and (C)
were deposited in such conduit individual retirement account
within sixty (60) days of receipt thereof and other than
earnings on said assets; and
(iv) amounts distributed to the Employee from a conduit
individual retirement account meeting the requirements of
clause (iii) above, and transferred by the Employee to this
Plan within sixty (60) days of his receipt thereof from such
conduit individual retirement account.
(g) Prior to accepting any transfers to which this Section applies, the
Administrator may require the Employee to establish that the amounts to
be transferred to this Plan meet the requirements of this Section and
may also require the Employee to provide an opinion of counsel
satisfactory to the Employer that the amounts to be transferred meet
the requirements of this Section.
(h) Notwithstanding anything herein to the contrary, a transfer
directly to this Plan from another qualified plan (or a transaction
having the effect of such a transfer) shall only be permitted if it
will not result in the elimination or reduction of any "Section
41l(d)(6) protected benefit" as described in Section 8.1.
4.7 VOLUNTARY CONTRIBUTIONS
(a) If this is an amendment to a Plan that had previously allowed
voluntary Employee contributions, then, except as provided in 4.7(b)
below, this Plan will not accept voluntary Employee contributions for
Plan Years beginning after the Plan Year in which this Plan is adopted
by the Employer.
(b) For 401(k) Plans, if elected in the Adoption Agreement, each
Participant may, at the discretion of the Administrator in a
nondiscriminatory manner, elect to voluntarily contribute a portion of
his compensation earned while a Participant under this Plan. Such
contributions shall be paid to the Trustee within a reasonable period
of time but in no event later than 90 days after the receipt of the
contribution.
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(c) The balance in each Participant's Voluntary Contribution Account
shall be fully Vested at all times and shall not be subject to
Forfeiture for any reason.
(d) A Participant may elect to withdraw his voluntary contributions
from his Voluntary Contribution Account and the actual earnings thereon
in a manner which is consistent with and satisfies the provisions of
Section 6.5, including, but not limited to, all notice and consent
requirements of Code Sections 411(a)(11) and 417 and the Regulations
thereunder. If the Administrator maintains sub-accounts with respect to
voluntary contributions (and earnings thereon) which were made on or
before a specified date, a Participant shall be permitted to designate
which sub-account shall be the source for his withdrawal. No
Forfeitures shall occur solely as a result of an Employee's withdrawal
of Employee contributions.
In the event such a withdrawal is made, or in the event a
Participant has received a hardship distribution pursuant to Regulation
1.401(k)-1(d)(2)(iii)(B) from any plan maintained by the Employer. then
such Participant shall be barred from making any voluntary
contributions for a period of twelve (12) months after receipt of the
withdrawal or distribution.
(e) At Normal Retirement Date, or such other date when the Participant
or his Beneficiary shall be entitled to receive benefits, the fair
market value of the Voluntary Contribution Account shall be used to
provide additional benefits to the Participant or his Beneficiary.
(f) The Administrator may direct that voluntary contributions made
after a valuation date be segregated into a separate account until such
time as the allocations pursuant to this Plan have been made, at which
time they may remain segregated or be invested as part of the general
Trust Fund, to be determined by the Administrator.
4.8 DIRECTED INVESTMENT ACCOUNT
(a) If elected in the Adoption Agreement, all Participants may direct
the Trustee as to the investment of all or a portion of any one or more
of their individual account balances. Participants may direct the
Trustee in writing to invest their account in specific assets as
permitted by the Administrator provided such investments are in
accordance with the Department of Labor regulations and are permitted
by the Plan. That portion of the account of any Participant so
directing will thereupon be considered a Directed Investment Account.
(b) A separate Directed Investment Account shall be established for
each Participant who has directed an investment. Transfers between the
Participant's regular account and their Directed Investment Account
shall be charged and credited as the case may be to each account. The
Directed Investment Account shall not share in Trust Fund Earnings, but
it shall be charged or credited as appropriate with the net earnings,
gains, losses and expenses as well as any appreciation or depreciation
in market value during each Plan
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Year attributable to such account.
(c) The Administrator shall establish a procedure, to be applied in a
uniform and nondiscriminatory manner, setting forth the permissible
investment options under this Section, how often changes between
investments may be made, and any other limitations that the
Administrator shall impose on a Participant's right to direct
investments.
4.9 QUALIFIED VOLUNTARY EMPLOYEE CONTRIBUTIONS
(a) If this is an amendment to a Plan that previously permitted
deductible voluntary contributions. then each Participant who made a
"Qualified Voluntary Employee Contribution" within the meaning of Code
Section 219(c)(2) as it existed prior to the enactment of the Tax
Reform Act of 1986, shall have his contribution held in a separate
Qualified Voluntary Employee Contribution Account which shall be fully
Vested at all times. Such contributions, however, shall not be
permitted if they are attributable to taxable years beginning after
December 31, 1986.
(b) A Participant may, upon written request delivered to the
Administrator, make withdrawals from his Qualified Voluntary Employee
Contribution Account. Any distribution shall be made in a manner which
is consistent with and satisfies the provisions of Section 6.5,
including, but not limited to, all notice and consent requirements of
Code Sections 411(a)(11) and 417 and the Regulations thereunder,
(c) At Normal Retirement Date, or such other date when the Participant
or his Beneficiary shall be entitled to receive benefits, the fair
market value of the Qualified Voluntary Employee Contribution Account
shall be used to provide additional benefits to the Participant or his
Beneficiary.
(d) Unless the Administrator directs Qualified Voluntary Employee
Contributions made pursuant to this Section be segregated into a
separate account for each Participant, they shall be invested as part
of the general Trust Fund and share in earnings and losses.
4.10 ACTUAL CONTRIBUTION PERCENTAGE TESTS
In the event this Plan previously provided for voluntary or mandatory
Employee contributions, then, with respect to Plan Years beginning after
December 31, 1986, such contributions must satisfy the provisions of Code
Section 401(m) and the Regulations thereunder.
4.11 INTEGRATION IN MORE THAN ONE PLAN
If the Employer and/or an Affiliated Employer maintain qualified
retirement plans integrated with Social Security such that any Participant in
this Plan is covered under more than one of such plans, then such plans will be
considered to be one plan and will be considered to be integrated if the extent
of the integration of all such plans does not exceed 100%. For purposes of
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49
the preceding sentence, the extent of integration of a plan is the ratio,
expressed as a percentage, which the actual benefits, benefit rate, offset rate,
or employer contribution rate, whatever is applicable under the Plan bears to
the limitation applicable to such Plan. If the Employer maintains two or more
standardized paired plans, only one plan may be integrated with Social Security.
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ARTICLE V
VALUATIONS
5.1 VALUATION OF THE TRUST FUND
The Administrator shall direct the Trustee, as of each Anniversary
Date, and at such other date or dates deemed necessary by the Administrator,
herein called "valuation date," to determine the net worth of the assets
comprising the Trust Fund as it exists on the "valuation date." In determining
such net worth, the Trustee shall value the assets comprising the Trust Fund at
their fair market value as of the "valuation date" and shall deduct all expenses
for which the Trustee has not yet obtained reimbursement from the Employer or
the Trust Fund.
5.2 METHOD OF VALUATION
In determining the fair market value of securities held in the Trust
Fund which are listed on a registered stock exchange, the Administrator shall
direct the Trustee to value the same at the prices they were last traded on such
exchange preceding the close of business on the "valuation date." If such
securities were not traded on the "valuation date," or if the exchange on which
they are traded was not open for business on the "valuation date." then the
securities shall be valued at the prices at which they were last traded prior to
the "valuation date." Any unlisted security held in the Trust Fund shall be
valued at its bid price next preceding the close of business on the "valuation
date," which bid price shall be obtained from a registered broker or an
investment banker. In determining the fair market value of assets other than
securities for which trading or bid prices can be obtained, the Trustee may
appraise such assets itself, or in its discretion, employ one or more appraisers
for that purpose and rely on the values established by such appraiser or
appraisers.
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ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT
Every Participant may terminate his employment with the Employer and
retire for the purposes hereof on or after his Normal Retirement Date or Early
Retirement Date. Upon such Normal Retirement Date or Early Retirement Date, all
amounts credited to such Participant's Combined Account shall become
distributable. However, a Participant may postpone the termination of his
employment with the Employer to a later date, in which event the participation
of such Participant in the Plan, including the right to receive allocations
pursuant to Section 4.3, shall continue until his Late Retirement Date. Upon a
Participant's Retirement Date, or as soon thereafter as is practicable, the
Administrator shall direct the distribution of all amounts credited to such
Participant's Combined Account in accordance with Section 6.5.
6.2 DETERMINATION OF BENEFITS UPON DEATH
(a) Upon the death of a Participant before his Retirement Date or other
termination of his employment, all amounts credited to such
Participant's Combined Account shall become fully Vested. The
Administrator shall direct, in accordance with the provisions of
Sections 6.6 and 6.7, the distribution of the deceased Participant's
accounts to the Participant's Beneficiary.
(b) Upon the death of a Former Participant, the Administrator shall
direct, in accordance with the provisions of Sections 6.6 and 6.7, the
distribution of any remaining amounts credited to the accounts of such
deceased Former Participant to such Former Participant's Beneficiary.
(c) The Administrator may require such Proper proof of death and such
evidence of the right of any person to receive payment of the value of
the account of a deceased Participant or Former Participant as the
Administrator may deem desirable. The Administrator's determination of
death and of the right of any person to receive payment shall be
conclusive.
(d) Unless otherwise elected in the manner prescribed in Section 6.6,
the Beneficiary of the Pre-Retirement Survivor Annuity shall be the
Participant's spouse. Except, however, the Participant may designate a
Beneficiary other than his spouse for the Pre-Retirement Survivor
Annuity if:
(1) the Participant and his spouse have validly waived the
Pre-Retirement Survivor Annuity in the manner prescribed in
Section 6.6, and the spouse has waived his or her right to be
the Participant's Beneficiary, or
(2) the Participant is legally separated or has been abandoned
(within the meaning of local law) and the Participant has a
court order to such effect (and
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there is no "qualified domestic relations order" as defined in
Code Section 414(p) which provides otherwise), or
(3) the Participant has no spouse, or
(4) the spouse cannot be located.
In such event the designation of a Beneficiary shall
be made on a form satisfactory to the Administrator. A
Participant may at any time revoke his designation of a
Beneficiary or change his Beneficiary by filing written notice
of such revocation or change with the Administrator. However,
the Participant's Spouse must again consent in writing to any
change in Beneficiary unless the original consent acknowledged
that the spouse had the right to limit consent only to a
specific Beneficiary and that the spouse voluntarily elected
to relinquish such right. The Participant may, at any time,
designate a Beneficiary for death benefits payable under the
Plan that are in excess of the Pre-Retirement Survivor
Annuity. In the event no valid designation of Beneficiary
exists at the time of the Participant's death, the death
benefit shall be payable to his estate.
(e) If the Plan provides an insured death benefit and a Participant
dies before any insurance coverage to which he is entitled under the
Plan is effected, his death benefit from such insurance coverage shall
be limited to the standard rated premium which was or should have been
used for such purpose.
(f) In the event of any conflict between the terms of this Plan and the
terms of any Contract issued hereunder, the Plan provisions shall
control.
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY
In the event of a Participant's Total and Permanent Disability prior to
his Retirement Date or other termination of his employment, all amounts credited
to such Participant's Combined Account shall become fully Vested. In the event
of a Participant's Total and Permanent Disability, the Administrator, in
accordance with the provisions of Sections 6.5 and 6.7, shall direct the
distribution to such Participant of all amounts credited to such Participant's
Combined Account as though he had retired.
6.4 DETERMINATION OF BENEFITS UPON TERMINATION
(a) On or before the Anniversary Date, or other valuation date,
coinciding with or subsequent to the termination of a Participant's
employment for any reason other than retirement, death, or Total and
Permanent Disability, the Administrator may direct that the amount of
the Vested portion of such Terminated Participant's Combined Account be
segregated and invested separately. In the event the Vested portion of
a Participant's Combined Account is not segregated, the amount shall
remain in a separate account for the Terminated Participant and share
in allocations pursuant to Section 4.3 until such time
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as a distribution is made to the Terminated Participant. The amount of
the portion of the Participant's Combined Account which is not Vested
may be credited to a separate account (which will always share in gains
and losses of the Trust Fund) and at such time as the amount becomes a
Forfeiture shall be treated in accordance with the provisions of the
Plan regarding Forfeitures.
Regardless of whether distributions in kind are permitted, in
the event that the amount of the Vested portion of the Terminated
Participant's Combined Account equals or exceeds the fair market value
of any insurance Contracts, the Trustee, when so directed by the
Administrator and agreed to by the Terminated Participant. shall
assign, transfer, and set over to such Terminated Participant all
Contracts on his life in such form or with such endorsements, so that
the settlement options and forms of payment are consistent with the
provisions of Section 6.5. In the event that the Terminated
Participant's Vested portion does not at least equal the fair market
value of the Contracts, if any, the Terminated Participant may pay over
to the Trustee the sum needed to Make the distribution equal to the
value of the Contracts being assigned or transferred, or the Trustee,
pursuant to the Participant's election, may borrow the cash value of
the Contracts from the Insurer so that the value of the Contracts is
equal to the Vested portion of the Terminated Participant's Combined
Account and then assign the Contracts to the Terminated Participant.
Distribution of the funds due to a Terminated Participant
shall be made on the occurrence of an event which would result in the
distribution had the Terminated Participant remained in the employ of
the Employer (upon the Participant's death. Total and Permanent
Disability, Early or Normal Retirement). However, at the election of
the Participant, the Administrator shall direct that the entire Vested
portion of the Terminated Participant's Combined Account to be payable
to such Terminated Participant provided the conditions, if any, set
forth in the Adoption Agreement have been satisfied. Any distribution
under this paragraph shall be made in a manner which is consistent with
and satisfies the provisions of Section 6.5, including but not limited
to, all notice and consent requirements of Code Sections 41l(a)(11) and
417 and the Regulations thereunder.
Notwithstanding the above, if the value of a Terminated
Participant's Vested benefit derived from Employer and Employee
contributions does not exceed, and at the time of any prior
distribution, has never exceeded $3,500, the Administrator shall direct
that the entire Vested benefit be paid to such Participant in a single
lump-sum without regard to the consent of the Participant or the
Participant's spouse. A Participant's Vested benefit shall not include
Qualified Voluntary Employee Contributions within the meaning of Code
Section 72(o)(5)(B) for Plan Years beginning prior to January 1, 1989.
(b) The Vested portion of any Participant's Account shall be a
percentage of such Participant's Account determined on the basis of the
Participant's number of Years of Service according to the vesting
schedule specified in the Adoption Agreement.
(c) For any Top Heavy Plan Year, one of the minimum top heavy vesting
schedules
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as elected by the Employer in the Adoption Agreement will automatically
apply to the Plan. The minimum top heavy vesting schedule applies to
all benefits within the meaning of Code Section 411(a)(7) except those
attributable to Employee contributions, including benefits accrued
before the effective date of Code Section 416 and benefits accrued
before the Plan became top heavy. Further, no decrease in a
Participant's Vested percentage may occur in the event the Plan's
status as top heavy changes for any Plan Year. However, this Section
does not apply to the account balances of any Employee who does not
have an Hour of Service after the Plan has initially become top heavy
and the Vested percentage of such Employee's Participant's Account
shall be determined without regard to this Section 6.4(c).
If in any subsequent Plan Year, the Plan ceases to be a Top
Heavy Plan, the Administrator shall continue to use the vesting
schedule in effect while the Plan was a Top Heavy Plan for each
Employee who had an Hour of Service during a Plan Year when the Plan
was Top Heavy.
(d) Notwithstanding the vesting schedule above, upon the complete
discontinuance of the Employer's contributions to the Plan or upon any
full or partial termination of the Plan, all amounts credited to the
account of any affected Participant shall become 100% Vested and shall
not thereafter be subject to Forfeiture.
(e) If this is an amended or restated Plan, then notwithstanding the
vesting schedule specified in the Adoption Agreement, the Vested
percentage of a Participant's Account shall not be less than the Vested
percentage attained as of the later of the effective date or adoption
date of this amendment and restatement. The computation of a
Participant's non-forfeitable percentage of his interest in the Plan
shall not be reduced as the result of any direct or indirect amendment
to this Article, or due to changes in the Plan's status as a Top Heavy
Plan.
(f) If the Plan's vesting schedule is amended, or if the Plan is
amended in any way that directly or indirectly affects the computation
of the Participant's non-forfeitable percentage or if the Plan is
deemed amended by an automatic change to a top heavy vesting schedule,
then each Participant with at least 3 Years of Service as of the
expiration date of the election period may elect to have his
non-forfeitable percentage Computed under the Plan without regard to
such amendment or change. Notwithstanding the foregoing, for Plan Years
beginning before January 1, 1989, or with respect to Employees who fail
to complete at least one (1) Hour of Service in a Plan Year beginning
after December 31, 1988, five (5) shall be substituted for three (3) in
the preceding sentence. If a Participant fails to make such election,
then such Participant shall be subject to the new vesting schedule. The
Participant's election period shall commence on the adoption date of
the amendment and shall end 60 days after the latest of:
(1) the adoption date of the amendment,
(2) the effective date of the amendment, or
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(3) the date the Participant receives written notice of the
amendment from the Employer or Administrator.
(g) (1) If any Former Participant shall be re-employed by the
Employer before a 1-Year Break in Service occurs, he shall
continue to participate in the Plan in the same manner as if
such termination had not occurred.
(2) If any Former Participant shall be re-employed by the
Employer before five (5) consecutive 1-Year Breaks in Service,
and such Former Participant had received a distribution of his
entire Vested interest prior to his reemployment, his
forfeited account shall be reinstated only if he repays the
full amount distributed to him before the earlier of five (5)
years after the first date on which the Participant is
subsequently re-employed by the Employer or the close of the
first period of 5 consecutive 1-year breaks in Service
commencing after the distribution. If a distribution occurs
for any reason other than a separation from service, the time
for repayment may not end earlier than five (5) years after
the date of separation. In the event the Former Participant
does repay the full amount distributed to him, the
undistributed portion of the Participant's Account must be
restored in full, unadjusted by any gains or losses occurring
subsequent to the Anniversary Date or other valuation date
preceding his termination. If an employee receives a
distribution pursuant to this section and the employee resumes
employment covered under this plan, the employee's
Employer-derived account balance will be restored to the
amount on the date of distribution if the employee repays to
the plan the full amount of the distribution attributable to
employer contributions before the earlier of 5 years after the
first date on which the participant is subsequently
re-employed by the employer, or the date the participant
incurs 5 consecutive 1-year breaks in service following the
date of the distribution. If a non-Vested Former Participant
was deemed to have received a distribution and such Former
Participant is re-employed by the Employer before five (5)
consecutive 1-year breaks in Service, then such Participant
will be deemed to have repaid the deemed distribution as of
the date of reemployment.
(3) If any Former Participant is re-employed after a 1-Year
Break in Service has occurred, Years of Service shall include
Years of Service prior to his 1-Year Break in Service subject
to the following rules:
(i) Any Former Participant who under the Plan does
not have a non-forfeitable right to any interest in
the Plan resulting from Employer contributions shall
lose credits if his consecutive 1-Year Breaks in
Service equal or exceed the greater of (A) five (5)
or (B) the aggregate number of his pre-break Years of
Service;
(ii) After five (5) consecutive 1-Year Breaks in
Service, a Former Participant's Vested Account
balance attributable to pre-break service
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shall not be increased as a result of post-break
service;
(iii) A Former Participant who is re-employed and who
has not had his Years of Service before a 1-year
break in Service disregarded pursuant to (i) above,
shall participate in the Plan as of his date of
reemployment;
(iv) If a Former Participant completes a Year of
Service (a 1-Year Break in Service previously
occurred, but employment had not terminated), he
shall participate in the Plan retroactively from the
first day of the Plan Year during which he completes
one (1) Year of Service.
(h) In determining Years of Service for purposes of vesting under the
Plan, Years of Service shall be excluded as specified in the Adoption
Agreement.
6.5 DISTRIBUTION OF BENEFITS
(a) (1) Unless otherwise elected as provided below, a Participant
who is married on the "annuity starting date" and who does not
die before the "annuity starting date" shall receive the value
of all of his benefits in the form of a Joint and Survivor
Annuity. The Joint and Survivor Annuity is an annuity that
commences immediately and shall be equal in value to a single
life annuity. Such joint and survivor benefits following the
Participant's death shall continue to the spouse during the
spouse's lifetime at a rate equal to 50% of the rate at which
such benefits were payable to the Participant. This Joint and
Survivor Annuity shall be considered the designated qualified
Joint and Survivor Annuity and automatic form of payment for
the purposes of this Plan. However, the Participant may elect
to receive a smaller annuity benefit with continuation of
payments to the spouse at a rate of seventy-five percent (75%)
or one hundred percent (100%) of the rate payable to a
Participant during his lifetime which alternative Joint and
Survivor Annuity shall be equal in value to the automatic
Joint and 50% Survivor Annuity. An unmarried Participant shall
receive the value of his benefit in the form of a life
annuity. Such unmarried Participant, however, may elect in
writing to waive the life annuity. The election must comply
with the provisions of this Section as if it were an election
to waive the Joint and Survivor Annuity by a married
Participant, but without the spousal consent requirement. The
Participant may elect to have any annuity provided for in this
Section distributed upon the attainment of the "earliest
retirement age" under the Plan. The "earliest retirement age"
is the earliest date on which, under the Plan, the Participant
could elect to receive retirement benefits.
(2) Any election to waive the Joint and Survivor Annuity must
be made by the Participant in writing during the election
period and be consented to by the Participant's spouse. If the
spouse is legally incompetent to give consent, the spouse's
legal guardian, even if such guardian is the Participant, may
give consent. Such election shall designate a Beneficiary (or
a form of benefits) that
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may not be changed without spousal consent (unless the consent
of the spouse expressly permits designations by the
Participant without the requirement of further consent by the
spouse's consent). Such spouse's consent shall be irrevocable
and must acknowledge the effect of such election and be
witnessed by a Plan representative or a notary public. Such
consent shall not be required if it is established to the
satisfaction of the Administrator that the required consent
cannot be obtained because there is no spouse, the spouse
cannot be located, or other circumstances that may be
prescribed by Regulations. The election made by the
Participant and consented to by his spouse may be revoked by
the Participant in writing without the consent of the spouse
at any time during the election period. The number of
revocations shall not be limited. Any new election must comply
with the requirements of this paragraph. A former spouse's
waiver shall not be binding on a new spouse.
(3) The election period to waive the Joint and Survivor
Annuity shall be the 90 day period ending on the "annuity
starting date."
(4) For purposes of this Section and Section 6.6, the "annuity
starting date" means the first day of the first period for
which an amount is paid as an annuity, or, in the case of a
benefit not payable in the form of an annuity, the first day
on which all events have occurred which entitles the
Participant to such benefit.
(5) With regard to the election, the Administrator shall
provide to the Participant no less than 30 days and no more
than 90 days before the "annuity starting date" a written
explanation of.
(i) the terms and conditions of the Joint and
Survivor Annuity, and
(ii) the Participant's right to make and the effect
of an election to waive the Joint and Survivor
Annuity, and
(iii) the right of the Participant's spouse to
consent to any election to waive the Joint and
Survivor Annuity, and
(iv) the right of the Participant to revoke such
election, and the effect of such revocation.
(b) In the event a married Participant duly elects pursuant to
paragraph (a)(2) above not to receive his benefit in the form of a
Joint and Survivor Annuity, or if such Participant is not married, in
the form of a life annuity, the Administrator, pursuant to the election
of the Participant, shall direct the distribution to a Participant or
his Beneficiary any amount to which he is entitled under the Plan in
one or more of the following methods which are permitted pursuant to
the Adoption Agreement:
(1) One lump-sum payment in cash or in property;
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(2) Payments over a period certain in monthly, quarterly,
semiannual, or annual cash installments. In order to provide
such installment payments, the Administrator may direct that
the Participant's interest in the Plan be segregated and
invested separately, and that the funds in the segregated
account be used for the payment of the installments. The
period over which such payment is to be made shall not extend
beyond the Participant's life expectancy (or the life
expectancy of the Participant and his designated Beneficiary);
(3) Purchase of or providing an annuity. However, such annuity
may not be in any form that will provide for payments over a
period extending beyond either the life of the Participant (or
the lives of the Participant and his designated Beneficiary)
or the life expectancy of the Participant (or the life
expectancy of the Participant and his designated Beneficiary).
(c) The present value of a Participant's Joint and Survivor Annuity
derived from Employer and Employee contributions may not be paid
without his written consent if the value exceeds, or has ever exceeded
at the time of any prior distribution, $3,500. Further, the spouse of a
Participant must consent in writing to any immediate distribution. If
the value of the Participant's benefit derived from Employer and
Employee contributions does not exceed $3,500 and has never exceeded
$3,500 at the time of any prior distribution, the Administrator may
immediately distribute such benefit without such Participant's consent.
No distribution may be made under the preceding sentence after the
"annuity starting date" unless the Participant and his spouse consent
in writing to such distribution. Any written consent required under
this paragraph must be obtained not more than 90 days before
commencement of the distribution and shall be made in a manner
consistent with Section 6.5(a)(2).
(d) Any distribution to a Participant who has a benefit which exceeds.
or has ever exceeded at the time of any prior distribution, $3,500
shall require such Participant's consent if such distribution commences
prior to the later of his Normal Retirement Age or age 62. With regard
to this required consent:
(1) No consent shall be valid unless the Participant has
received a general description of the material features and an
explanation of the relative values of the optional forms of
benefit available under the Plan that would satisfy the notice
requirements of Code Section 417.
(2) The Participant must be informed of his right to defer
receipt of the distribution. If a Participant fails to
consent, it shall be deemed an election to defer the
commencement of payment of any benefit. However, any election
to defer the receipt of benefits shall not apply with respect
to distributions which are required under Section 6.5(e).
(3) Notice of the rights specified under this paragraph shall
be provided no
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less than 30 days and no more than 90 days before the "annuity
starting date."
(4) Written consent of the Participant to the distribution
must not be made before the Participant receives the notice
and must not be made more than 90 days before the "annuity
starting date."
(5) No consent shall be valid if a significant detriment is
imposed under the Plan on any Participant who does not consent
to the distribution.
(e) Notwithstanding any provision in the Plan to the contrary, the
distribution of a Participant's benefits, made on or after January 1,
1985, whether under the Plan or through the purchase of an annuity
Contract, shall be made in accordance with the following requirements
and shall otherwise comply with Code Section 401(a)(9) and the
Regulations thereunder (including Regulation Section 1.401(a)(9)-2),
the provisions of which are incorporated herein by reference:
(1) A Participant's benefits shall be distributed to him not
later than April 1st of the calendar year following the later
of (i) the calendar year in which the Participant attains age
70 1/2 or (ii) the calendar year in which the Participant
retires, provided, however, that this clause (ii) shall not
apply in the case of a Participant who is a "five (5) percent
owner" at any time during the five (5) Plan Year period ending
in the calendar year in which he attains age 70 1/2 or, in the
case of a Participant who becomes a "five (5) percent owner"
during any subsequent Plan Year, clause (ii) shall no longer
apply and the required beginning date shall be the April 1st
of the calendar year following the calendar year in which such
subsequent Plan Year ends. Alternatively, distributions to a
Participant must begin no later than the applicable April 1st
as determined under the preceding sentence and must be made
over the life of the Participant (or the lives of the
Participant and the Participant's designated Beneficiary) or,
if benefits are paid in the form of a Joint and Survivor
Annuity, the life expectancy of the Participant (or the life
expectancies of the Participant and his designated
Beneficiary) in accordance with Regulations. For Plan Years
beginning after December 31, 1988, clause (ii) above shall not
apply to any Participant unless the Participant had attained
age 70 1/2 before January 1, 1988 and was not a "five (5)
percent owner" at any time during the Plan Year ending with or
within the calendar year in which the Participant attained age
66 1/2 or any subsequent Plan Year.
(2) Distributions to a Participant and his Beneficiaries shall
only be made in accordance with the incidental death benefit
requirements of Code Section 401(a)(9)(G) and the Regulations
thereunder.
Additionally, for calendar years beginning before
1989, distributions may also be made under an alternative
method which provides that the then present value of the
payments to be made over the period of the Participant's life
expectancy exceeds fifty percent (50%) of the then present
value of the total
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payments to be made to the Participant and his Beneficiaries.
(f) For purposes of this Section, the life expectancy of a Participant
and a Participant's spouse (other than in the case of a life annuity)
shall be re-determined annually in accordance with Regulations if
permitted pursuant to the Adoption Agreement. If the Participant or the
Participant's spouse may elect whether recalculations will be made,
then the election, once made, shall be irrevocable. If no election is
made by the time distributions must commence, then the life expectancy
of the Participant and the Participant's spouse shall not be subject to
recalculation. Life expectancy and joint and last survivor expectancy
shall be computed using the return multiples in Tables V and VI of
Regulation 1.72-9.
(g) All annuity Contracts under this Plan shall be non-transferable
when distributed. Furthermore, the terms of any annuity Contract
purchased and distributed to a Participant or spouse shall comply with
all of the requirements of this Plan.
(h) Subject to the spouse's right of consent afforded under the Plan,
the restrictions imposed by this Section shall not apply if a
Participant has, prior to January 1, 1984, made a written designation
to have his retirement benefit paid in an alternative method acceptable
under Code Section 401(a) as in effect prior to the enactment of the
Tax Equity and Fiscal Responsibility Act of 1982.
(i) If a distribution is made at a time when a Participant who has not
terminated employment is not fully Vested in his Participant's Account
and the Participant may increase the Vested percentage in such account:
(1) A separate account shall be established for the
Participant's interest in the Plan as of the time of the
distribution, and
(2) At any relevant time the Participant's Vested portion of
the separate account shall be equal to an amount ("X")
determined by the formula:
X equals P(AB plus (RxD))-(R x D)
For purposes of applying the formula: P is the Vested
percentage at the relevant time, AB is the account balance at
the relevant time, D is the amount of distribution, and R is
the ratio of the account balance at the relevant time to the
account balance after distribution.
6.6 DISTRIBUTION OF BENEFITS UPON DEATH
(a) Unless otherwise elected as provided below, a Vested Participant
who dies before the annuity starting date and who has a surviving
spouse shall have the Pre-Retirement Survivor Annuity paid to his
surviving spouse. The Participant's spouse may direct that payment of
the Pre-Retirement Survivor Annuity commence within a reasonable period
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61
after the Participant's death. If the spouse does not so direct,
payment of such benefit will commence at the time the Participant would
have attained the later of his Normal Retirement Age or age 62.
However, the spouse may elect a later commencement date. Any
distribution to the Participant's spouse shall be subject to the rules
specified in Section 6.6(h).
(b) Any election to waive the Pre-Retirement Survivor Annuity before
the Participant's death must be made by the Participant in writing
during the election period and shall require the spouse's irrevocable
consent in the same manner provided for in Section 6.5(a)(2). Further,
the spouse's consent must acknowledge the specific non-spouse
Beneficiary. Notwithstanding the foregoing, the non-spouse Beneficiary
need not be acknowledged, provided the consent of the spouse
acknowledges that the spouse has the right to limit consent only to a
specific Beneficiary and that the spouse voluntarily elects to
relinquish such right.
(c) The election period to waive the Pre-Retirement Survivor Annuity
shall begin on the first day of the Plan Year in which the Participant
attains age 35 and end on the date of the Participant's death. An
earlier waiver (with spousal consent) may be made provided a written
explanation of the Pre-Retirement Survivor Annuity is given to the
Participant and such waiver becomes invalid at the beginning of the
Plan Year in which the Participant turns age 35. In the event a Vested
Participant separates from service prior to the beginning of the
election period, the election period shall begin on the date of such
separation from service.
(d) With regard to the election, the Administrator shall provide each
Participant within the applicable period, with respect to such
Participant (and consistent with Regulations), a written explanation of
the Pre-Retirement Survivor Annuity containing comparable information
to that required pursuant to Section 6.5(a)(4). For the purposes of
this paragraph, the term "applicable period" means, with respect to a
Participant, whichever of the following periods ends last:
(1) The period beginning with the first day of the Plan Year
in which the Participant attains age 32 and ending with the
close of the Plan Year preceding the Plan Year in which the
Participant attains age 35;
(2) A reasonable period after the individual becomes a
Participant. For this purpose, in the case of an individual
who becomes a Participant after age 32, the explanation must
be provided by the end of the three-year period beginning with
the first day of the first Plan Year for which the individual
is a Participant;
(3) A reasonable period ending after the Plan no longer fully
subsidizes the cost of the Pre-Retirement Survivor Annuity
with respect to the Participant;
(4) A reasonable period ending after Code Section 401(a)(11)
applies to the Participant; or
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(5) A reasonable period after separation from service in the
case of a Participant who separates before attaining age 35.
For this purpose, the Administrator must provide the
explanation beginning one year before the separation from
service and ending one year after separation.
(e) The Pre-Retirement Survivor Annuity provided for in this Section
shall apply only to Participants who are credited with an Hour of
Service on or after August 23, 1984. Former Participants who are not
credited with an Hour of Service on or after August 23, 1984 shall be
provided with rights to the Pre-Retirement Survivor Annuity in
accordance with Section 303(c)(2) of the Retirement Equity Act of 1984.
(f) If the value of the Pre-Retirement Survivor Annuity derived from
Employer and Employee Contributions does not exceed $3,500 and has
never exceeded $3,500 at the time of any prior distribution, the
Administrator shall direct the immediate distribution of such amount to
the Participant's spouse. No distribution may be made under the
preceding sentence after the annuity starting date unless the spouse
consents in writing. If the value exceeds. or has ever exceeded at the
time of any prior distribution, $3,500, an immediate distribution of
the entire amount may be made to the surviving spouse, provided such
surviving spouse consents in writing to such distribution. Any written
consent required under this paragraph must be obtained not more than 90
days before commencement of the distribution and shall be made in a
manner consistent with Section 6.5(a)(2).
(g) (1) In the event there is an election to waive the
Pre-Retirement Survivor Annuity, and for death benefits in
excess of the Pre-Retirement Survivor Annuity, such death
benefits shall be paid to the Participant's Beneficiary by
either of the following methods, as elected by the Participant
(or if no election has been made prior to the Participant's
death, by his Beneficiary) subject to the rules specified in
Section 6.6(h) and the selections made in the Adoption
Agreement:
(i) One lump-sum payment in cash or in property;
(ii) Payment in monthly, quarterly, semi-annual, or
annual cash installments over a period to be
determined by the Participant or his Beneficiary.
After periodic installments commence, the Beneficiary
shall have the right to reduce the period over which
such periodic installments shall be made, and the
cash amount of such periodic installments shall be
adjusted accordingly.
(iii) If death benefits in excess of the
Pre-Retirement Survivor Annuity are to be paid to the
surviving spouse, such benefits may be paid pursuant
to (i) or (ii) above, or used to purchase an annuity
so as to increase the payments made pursuant to the
Pre-Retirement Survivor Annuity;
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(2) In the event the death benefit payable pursuant to Section
6.2 is payable in installments, then, upon the death of the
Participant, the Administrator may direct that the death
benefit be segregated and invested separately, and that the
funds accumulated in the segregated account be used for the
payment of the installments.
(h) Notwithstanding any provision in the Plan to the contrary,
distributions upon the death of a Participant made on or after January
1, 1985, shall be made in accordance with the following requirements
and shall otherwise comply with Code Section 401(a)(9) and the
Regulations thereunder.
(1) If it is determined, pursuant to Regulations, that the
distribution of a Participant's interest has begun and the
Participant dies before his entire interest has been
distributed to him, the remaining portion of such interest
shall be distributed at least as rapidly as under the method
of distribution selected pursuant to Section 6.5 as of his
date of death.
(2) If a Participant dies before he has begun to receive any
distributions of his interest in the Plan or before
distributions are deemed to have begun pursuant to
Regulations, then his death benefit shall be distributed to
his Beneficiaries in accordance with the following rules
subject to the selections made in the Adoption Agreement and
Subsections 6.6(h)(3) and 6.6(i) below:
(i) The entire death benefit shall be distributed to
the Participant's Beneficiaries by December 31st of
the calendar year in which the fifth anniversary of
the Participant's death occurs;
(ii) The 5-year distribution requirement of (i) above
shall not apply to any portion of the deceased
Participant's interest which is payable to or for The
benefit of a designated Beneficiary. In such event.
such portion shall be distributed over the life of
such designated Beneficiary (or over a period not
extending beyond the life expectancy of such
designated Beneficiary) provided such distribution
begins not later than December 31st of the calendar
year immediately following the calendar year in which
the Participant died;
(iii) However, in the event the Participant's spouse
(determined as of the date of the Participant's
death) is his designated Beneficiary, the provisions
of (ii) above shall apply except that the requirement
that distributions commence within one year of the
Participant's death shall not apply. In lieu thereof,
distributions must commence on or before the later
of, (1) December 31st of the calendar year
immediately following the calendar year in which the
Participant died; or (2) December 31st of the
calendar year in which the Participant would have
attained age 70 1/2. If the surviving spouse dies
before distributions to such spouse begin, then the
5-
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year distribution requirement of this Section shall
apply as if the spouse was the Participant.
(3) Notwithstanding subparagraph (2) above, or any selections
made in the Adoption Agreement, if a Participant's death
benefits are to be paid in the form of a Pre-Retirement
Survivor Annuity, then distributions to the Participant's
surviving spouse must commence on or before the later of: (1)
December 31st of the calendar year immediately following the
calendar year in which the Participant died: or (2) December
31st of the calendar year in which the Participant would have
attained age 70 1/2.
(i) For purposes of Section 6.6(h)(2), the election by a designated
Beneficiary to be excepted from the 5-year distribution requirement (if
permitted in the Adoption Agreement) must be made no later than
December 31st of the calendar year following the calendar year of the
Participant's death. Except, however, with respect to a designated
Beneficiary who is the Participant's surviving spouse, the election
must be made by the earlier of: (1) December 31st of the calendar year
immediately following the calendar year in which the Participant died
or, if later, the calendar year in which the Participant would have
attained age 70 1/2; or (2) December 31st of the calendar year which
contains the fifth anniversary of the date of the Participant's death.
An election by a designated Beneficiary must be in writing and shall be
irrevocable as of the last day of the election period stated herein. In
the absence of an election by the Participant or a designated
Beneficiary, the 5-year distribution requirement shall apply.
(j) For purposes of this Section, the life expectancy of a Participant
and a Participant's spouse (other than in the case of a life annuity)
shall or shall not be re-determined annually as provided in the
Adoption Agreement and in accordance with Regulations. If the
Participant or the Participant's spouse may elect, pursuant to the
Adoption Agreement, to have life expectancies recalculated, then the
election, once made shall be irrevocable. If no election is made by the
time distributions must commence, then the life expectancy of the
Participant and the Participant's spouse shall not be subject to
recalculation. Life expectancy and joint and last survivor expectancy
shall be computed using the return Multiples in Tables V and VI of
Regulation Section 1.72-9.
(k) In the event that less than 100% of a Participant's interest in the
Plan is distributed to such Participant's spouse, the portion of the
distribution attributable to the Participant's Voluntary Contribution
Account shall be in the same proportion that the Participant's
Voluntary Contribution Account bears to the Participant's total
interest in the Plan.
(l) Subject to the spouse's right of counsel afforded under the Plan,
the restrictions imposed by this Section shall not apply if a
Participant has, prior to January 1, 1984, made a written designation
to have his death benefits paid in an alternative method acceptable
under Code Section 401(a) as in effect prior to the enactment of the
Tax Equity and Fiscal Responsibility Act of 1982.
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6.7 TIME OF SEGREGATION OR DISTRIBUTION
Except as limited by Sections 6.5 and 6.6, whenever a distribution is
to be made, or a series of payments are to commence, on or as of an Anniversary
Date, the distribution or series of payments may be made or begun on such date
or as soon thereafter as is practicable, but in no event later than 180 days
after the Anniversary Date. However, unless a Former Participant elects in
writing to defer the receipt of benefits (such election may not result in a
death benefit that is more than incidental), the payment of benefits shall begin
not later than the 60th day after the close of the Plan Year in which the latest
of the following events occurs: (a) the date on which the Participant attains
the earlier of age 65 or the Normal Retirement Age specified herein; (b) the
10th anniversary of the year in which the Participant commenced participation in
the Plan; or (c) the date the Participant terminates his service with the
Employer.
Notwithstanding the foregoing, the failure of a Participant and, if
applicable, the Participant's spouse, to consent to a distribution pursuant to
Section 6.5(d), shall be deemed to be an election to defer the commencement of
payment of any benefit sufficient to satisfy this Section.
6.8 DISTRIBUTION FOR MINOR BENEFICIARY
In the event a distribution is to be made to a minor, then the
Administrator may direct that such distribution be paid to the legal guardian,
or if none, to a parent of such Beneficiary or a responsible adult with whom the
Beneficiary maintains his residence, or to the custodian for such Beneficiary
under the Uniform Gift to Minors Act or Gift to Minors Act, if such is permitted
by the laws of the state in which said Beneficiary resides. Such a payment to
the legal guardian, custodian or parent of a minor Beneficiary shall fully
discharge the Trustee, Employer, and Plan from further liability on account
thereof.
6.9 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN
In the event that all, or any portion, of the distribution payable to a
Participant or his Beneficiary hereunder shall, at the later of the
Participant's attainment of age 62 or his Normal Retirement. Age, remain unpaid
solely by reason of the inability of the Administrator, after sending a
registered letter, return receipt requested, to the last known address, and
after further diligent effort, to ascertain the whereabouts of such Participant
or his Beneficiary, the amount so distributable shall be treated as a Forfeiture
pursuant to the Plan. In the event a Participant or Beneficiary is located
subsequent to his benefit being reallocated. such benefit shall be restored,
first from Forfeitures, if any, and then from an additional Employer
contribution if necessary.
6.10 PRE-RETIREMENT DISTRIBUTION
For Profit Sharing Plans and 401(k) Profit Sharing Plans, if elected in
the Adoption Agreement, at such time as a Participant shall have attained the
age specified in the Adoption Agreement, the Administrator, at the election of
the Participant, shall direct the distribution of up
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to the entire amount then credited to the accounts maintained on behalf of the
Participant. However, no such distribution from the Participant's Account shall
occur prior to 100% Vesting. In the event that the Administrator makes such a
distribution, the Participant shall continue to be eligible to participate in
the Plan on the same basis as any other Employee. Any distribution made pursuant
to this Section shall be made in a manner consistent with Section 6.5,
including, but not limited to, all notice and consent requirements of Code
Sections 411(a)(11) and 417 and the Regulations thereunder.
6.11 ADVANCE DISTRIBUTION FOR HARDSHIP
(a) For Profit Sharing Plans, if elected in the Adoption Agreement, the
Administrator. at the election of the Participant. shall direct the
distribution to any Participant in any one Plan Year up to the lesser
of 100% of his Participant's Combined Account valued as of the last
Anniversary Date or other valuation date or the amount necessary to
satisfy the immediate and heavy financial need of the Participant. Any
distribution made pursuant to this Section shall be deemed to be made
as of the first day of the Plan Year or, if later, the valuation date
immediately preceding the date of distribution, and the account from
which the distribution is made shall be reduced accordingly. Withdrawal
under this Section shall be authorized only if the distribution is on
account of:
(1) Medical expenses described in Code Section 213(d) incurred
by the Participant, his spouse, or any of his dependents (as
defined in Code Section 152) or expenses necessary for these
persons to obtain medical care;
(2) The purchase (excluding mortgage payments) of a principal
residence for the Participant;
(3) Funeral expenses for a member of the Participant's family;
(4) Payment of tuition and related educational fees for the
next 12 months of post-secondary education for the
Participant, his spouse, children, or dependents; or
(5) The need to prevent the eviction of the Participant from
his principal residence or foreclosure on the mortgage of the
Participant's principal residence.
(b) No such distribution shall be made from the Participant's Account
until such Account has become fully Vested.
(c) Any distribution made pursuant to this Section shall be made in a
manner which is consistent with and satisfies the provisions of Section
6.5, including, but not limited to, all notice and consent requirements
of Code Sections 411(a)(11) and 417 and the Regulations thereunder.
6.12 LIMITATIONS ON BENEFITS AND DISTRIBUTIONS
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All rights and benefits, including elections, provided to a Participant
in this Plan shall be subject to the rights afforded to any "alternate payee"
under a "qualified domestic relations order." Furthermore, a distribution to an
"alternate payee" shall be permitted if such distribution is authorized by a
"qualified domestic relations order," even if the affected Participant has not
reached the "earliest retirement age" under the Plan. For the purposes of this
Section, "alternate payee," "qualified domestic relations order" and "earliest
retirement age" shall have the meaning set forth under Code Section 414(p).
6.13 SPECIAL RULE FOR NON-ANNUITY PLANS
If elected in the Adoption Agreement, the following shall apply to a
Participant in a Profit Sharing Plan or 401(k) Profit Sharing Plan and to any
distribution, made on or after the first day of the First plan year beginning
after December 31, 1988, from or under a separate account attributable solely to
accumulated deductible employee contributions, as defined in Code Section
72(o)(5)(B), and maintained on behalf of a participant in a money purchase
pension plan, (including a target benefit plan):
(a) The Participant shall be prohibited from electing benefits in the
form of a life annuity;
(b) Upon the death of the Participant, the Participant's entire Vested
account balances will be paid to his or her surviving spouse, or, if
there is no surviving spouse or the surviving spouse has already
consented to waive his or her benefit; in accordance with Section 6.6,
to his designated Beneficiary;
(c) Except to the extent otherwise provided in this Section and Section
6.5(h), the other provisions of Sections 6.2, 6.5 and 6.6 regarding
spousal consent and the forms of distributions shall be inoperative
with respect to this Plan.
(d) If a distribution is one to which Sections 401(a)(11) and 417 of
the Internal Revenue Code do not apply, such distribution may commence
less than 30 days after the notice required under Section
1.411(a)-11(c) of the Income Tax Regulations is given, provided that:
(1) the Plan Administrator clearly informs the Participant
that the Participant has a right to a period of at least 30
days after the notice to consider the decision of whether or
not to elect a distribution (and, if applicable, a particular
distribution option), and
(2) the Participant, after receiving the notice, affirmatively
elects a distribution.
This Section shall not apply to any Participant if it
is determined that this Plan is a direct or indirect
transferee of a defined benefit plan or money purchase
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plan, or a target benefit plan, stock bonus or profit sharing
plan which would otherwise provide for a life annuity form of
payment to the Participant.
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ARTICLE VII
TRUSTEE
7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE
The Trustee shall have the following categories of responsibilities:
(a) Consistent with the "funding policy and method" determined by the
Employer to invest, manage, and control the Plan assets subject,
however, to the direction of an Investment Manager if the Employer
should appoint such manager as to all or a portion of the assets of the
Plan;
(b) At the direction of the Administrator, to pay benefits required
under the Plan to be paid to Participants, or, in the event of their
death, to their Beneficiaries;
(c) To maintain records of receipts and disbursements and furnish to
the Employer and/or Administrator for each Plan Year a written annual
report per Section 7.7; and
(d) If there shall be more than one Trustee, they shall act by a
majority of their number, but may authorize one or more of them to sign
papers on their behalf.
7.2 INVESTMENT POWERS AND DUTIES OF THE TRUSTEE
(a) The Trustee shall invest and reinvest the Trust Fund to keep the
Trust Fund invested without distinction between principal and income
and in such securities or property, real or personal, wherever
situated, as the Trustee shall deem advisable, including, but not
limited to, stocks, common or preferred, bonds and other evidences of
indebtedness or ownership, and real estate or any interest therein. The
Trustee shall at all times in making investments of the Trust Fund
consider, among other factors, the short and long-term financial needs
of the Plan on the basis of information furnished by the Employer. In
making such investments, the Trustee shall not be restricted to
Securities or other property of the character expressly authorized by
the applicable law for trust investments; however, the Trustee shall
give due regard to any limitations imposed by the Code or the Act so
that at all times this Plan may qualify as a qualified Plan and Trust.
(b) The Trustee may employ a bank or trust company pursuant to the
terms of its usual and customary bank agency agreement, under which the
duties of such bank or trust company shall be of a custodial, clerical
and record-keeping nature.
(c) The Trustee may from time to time transfer to a common, collective,
or pooled trust fund maintained by any corporate Trustee hereunder
pursuant to Revenue Ruling 8 1-100, all or such part of the Trust Fund
as the Trustee may deem advisable, and such part or all of the Trust
Fund so transferred shall be subject to all the terms and provisions of
the common, collective, or pooled trust fund which contemplate the
commingling for investment purposes of such trust assets with trust
assets of other trusts. The Trustee may
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withdraw from such common, collective, or pooled trust fund all or such
part of the Trust Fund as the Trustee may deem advisable.
(d) The Trustee, at the direction of the Administrator and pursuant to
instructions from the individual designated in the Adoption Agreement
for such purpose and subject to the conditions set forth in the
Adoption Agreement, shall ratably apply for, own, and pay all premiums
on Contracts on the lives of the Participants. Any initial or
additional Contract purchased on behalf of a Participant shall have a
face amount of not less than $1,000, the amount set forth in the
Adoption Agreement, or the limitation of the Insurer, whichever is
greater. If a life insurance Contract is to be purchased for a
Participant, the aggregate premium for ordinary life insurance for each
Participant must be less than 50% of the aggregate contributions and
Forfeitures allocated to a Participant's Combined Account. For purposes
of this limitation, ordinary life insurance Contracts are Contracts
with both non-decreasing death benefits and non-increasing premiums. If
term insurance or universal life insurance is purchased with such
contributions, the aggregate premium must be 25% or less of the
aggregate contributions and Forfeitures allocated to a Participant's
Combined Account. If both term insurance and ordinary life insurance
are purchased with such contributions, the amount expended for term
insurance plus one-half of the premium for ordinary life insurance may
not in the aggregate exceed 25% of the aggregate Employer contributions
and Forfeitures allocated to a Participant's Combined Account. The
Trustee must distribute the Contracts to the Participant or convert the
entire value of the Contracts at or before retirement into cash or
provide for a periodic income so that no portion of such value may be
used to continue life insurance protection beyond retirement.
Notwithstanding the above, the limitations imposed herein with respect
to the purchase of life insurance shall not apply, in the case of a
Profit Sharing Plan, to the portion of a Participant's Account that has
accumulated for at least two (2) Plan Years.
Notwithstanding anything hereinabove to the contrary, amounts
credited to a Participant's Qualified Voluntary Employee Contribution
Account pursuant to Section 4.9, shall not be applied to the purchase
of life insurance contracts.
(e) The Trustee will be the owner of any life insurance Contract
purchased under the terms of this Plan. The Contract must provide that
the proceeds will be payable to the Trustee; however, the Trustee shall
be required to pay over all proceeds of the Contract to the
Participant's designated Beneficiary in accordance with the
distribution provisions of Article VI. A Participant's spouse will be
the designated Beneficiary pursuant to Section 6.2, unless a qualified
election has been made in accordance with Sections 6.5 and 6.6 of the
Plan. if applicable. Under no circumstances shall the Trust retain any
part of the proceeds. However, the Trustee shall not pay the proceeds
in a method that would violate the requirements of the Retirement
Equity Act, as stated in Article VI of the Plan, or Code Section
401(a)(9) and the Regulations thereunder.
7.3 OTHER POWERS OF THE TRUSTEE
The Trustee, in addition to all powers and authorities under common
law, statutory
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authority, including the Act, and other provisions of this Plan, shall have the
following powers and authorities to be exercised in the Trustee's sole
discretion:
(a) To purchase, or subscribe for, any securities or other property and
to retain the same. In conjunction with the purchase of securities,
margin accounts may be opened and maintained;
(b) To sell, exchange, convey, transfer, grant options to purchase, or
otherwise dispose of any securities or other property held by the
Trustee, by private contract or at public auction. No person dealing
with the Trustee shall be bound to see to the application of the
purchase money or to inquire into the validity, expediency, or
propriety of any such sale or other disposition, with or without
advertisement;
(c) To vote upon any stocks, bonds, or other securities; to give
general or special proxies or powers of attorney with or without power
of substitution; to exercise any conversion privileges, subscription
rights or other options, and to make any payments incidental thereto;
to oppose, or to consent to, or otherwise participate in, corporate
reorganizations or other changes affecting corporate securities, and to
delegate discretionary powers, and to pay any assessments or charges in
connection therewith; and generally to exercise any of the powers of an
owner with respect to stocks, bonds, securities, or other property;
(d) To cause any securities or other property to be registered in the
Trustee's own name or in the name of one or more of the Trustee's
nominees, and to hold any investments in bearer form, but the books and
records of the Trustee shall at all times show that all such
investments are part of the Trust Fund;
(e) To borrow or raise money for the purposes of the Plan in such
amount, and upon such terms and conditions, as the Trustee shall deem
advisable; and for any sum so borrowed, to issue a promissory note as
Trustee, and to secure the repayment thereof by pledging all, or any
part, of the Trust Fund, and no person lending money to the Trustee
shall be bound to see to the application of the money lent or to
inquire into the validity, expediency, or propriety of any borrowing;
(f) To keep such portion of the Trust Fund in cash or cash balances as
the Trustee may, from time to time, deem to be in the best interests of
the Plan, without liability for interest thereon;
(g) To accept and retain for such time as it may deem advisable any
securities or other property received or acquired by it as Trustee
hereunder, whether or not such securities or other property would
normally be purchased as investments hereunder;
(h) To make, execute, acknowledge, and deliver any and all documents of
transfer and conveyance and any and all other instruments that may be
necessary or appropriate to Carry out the powers herein granted;
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(i) To Settle, compromise, or submit to arbitration any claims, debts,
or damages due or owing to or from the Plan, to commence or defend
suits or legal or administrative proceedings, and to represent the Plan
in all suits and legal and administrative proceedings;
(j) To employ suitable agents and counsel and to pay their reasonable
expenses an compensation, and such agent or counsel may or may not be
agent or counsel for the Employer:
(k) To apply for and procure from the Insurer as an investment of the
Trust Fund such annuity, or other Contracts (on the life of any
Participant) as the Administrator shall deem proper; to exercise, at
any time or from time to time, whatever rights and privileges may be
granted under such annuity, or other Contracts; to collect, receive,
and settle for the proceeds of all such annuity, or other Contracts as
and when entitled to do so under the provisions thereof;
(l) To invest funds of the Trust in time deposits or savings accounts
bearing a reasonable rate of interest in the Trustee's bank;
(m) To invest in Treasury Bills and other forms of United States
government obligations;
(n) To sell, purchase and acquire put or call options if the options
are traded on and purchased through a national securities exchange
registered under the Securities Exchange Act of 1934, as amended, or,
if the options are not traded on a national securities exchange, are
guaranteed by a member firm of the New York Stock Exchange;
(o) To deposit monies in federally insured savings accounts or
certificates of deposit in banks or savings and loan associations;
(p) To pool all or any of the Trust Fund, from time to time, with
assets belonging to any other qualified employee pension benefit trust
created by the Employer or any Affiliated Employer, and to commingle
such assets and make joint or common investments and carry joint
accounts on behalf of this Plan and such other trust or trusts,
allocating undivided shares or interests in such investments or
accounts or any pooled assets of the two or more trusts in accordance
with their respective interests;
(q) To do all such acts and exercise all such rights and privileges,
although not specifically mentioned herein, as the Trustee may deem
necessary to carry out the purposes of the Plan;
(r) Directed Investment Account. The powers granted to the Trustee
shall be exercised in the sole Fiduciary discretion of the Trustee.
However, if elected in the Adoption Agreement, each Participant may
direct the Trustee to separate and keep
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separate all or a portion of his interest in the Plan; and further each
Participant is authorized and empowered, in his sole and absolute
discretion, to give directions to the Trustee in such form as the
Trustee may require concerning the investment of the Participant's
Directed Investment Account, which directions must be followed by the
Trustee subject, however, to restrictions on payment of life insurance
premiums. Neither the Trustee nor any other persons including the
Administrator or otherwise shall be under any duty to question any such
direction of the Participant or to review any securities or other
property, real or personal, or to make any suggestions to the
Participant in connection therewith, and the Trustee shall comply as
promptly as practicable with directions given by the Participant
hereunder. Any such direction may be of a continuing nature or
otherwise and may be revoked by the Participant at any time in such
form as the Trustee may require. The Trustee may refuse to comply with
any direction from the Participant in the event the Trustee, in its
sole and absolute discretion, deems such directions improper by virtue
of applicable law, and in such event, the Trustee shall not be
responsible or liable for any loss or expense which may result. Any
costs and expenses related to compliance with the Participant's
directions shall be borne by the Participant's Directed Investment
Account.
Notwithstanding anything hereinabove to the contrary, the
Trustee shall not, at any time after December 31, 1981, invest any
portion of a Directed Investment Account in "collectibles" within the
meaning of that Term as employed in Code Section 408(m).
7.4 LOANS TO PARTICIPANTS
(a) If specified in the Adoption Agreement, the Trustee (or, if loans
are treated as Directed Investment pursuant to the Adoption Agreement,
the Administrator) may, in the Trustee's (or, if applicable, the
Administrator's) sole discretion, make loans to Participants or
Beneficiaries under the following circumstances: (1) loans shall be
made available to all Participants and Beneficiaries on a reasonably
equivalent basis; (2) loans shall not be made available to Highly
Compensated Employees in an amount greater than the amount made
available to other Participants; (3) loans shall bear a reasonable rate
of interest; (4) loans shall be adequately secured; and (5) shall
provide for periodic repayment over a reasonable period of time.
(b) Loans shall not be made to any Shareholder-Employee or
Owner-Employee unless an exemption for such loan is obtained pursuant
to Act Section 408 and further provided that such loan would not be
subject to tax pursuant to Code Section 4975.
(c) Loans shall not be granted to any Participant that provide for a
repayment period extending beyond such Participant's Normal Retirement
Date.
(d) Loans made pursuant to this Section (when added to the outstanding
balance of all other loans made by the Plan to the Participant) shall
be limited to the lesser of:
(1) $50,000 reduced by the excess (if any) of the highest
outstanding balance
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of loans from the Plan to the Participant during the one year
period ending on the day before the date on which such loan is
made, over the outstanding balance of loans from the Plan to
the Participant on the date on which such loan was made, or
(2) the greater of (A) one-half (1/2) of the present value of
the non-forfeitable accrued benefit of the Employee under the
Plan, or (B), if permitted pursuant to the Adoption Agreement,
$10,000.
For purposes of this limit, all plans of the Employer
shall be considered one plan. Additionally, with respect to
any loan made prior to January 1, 1987, the $50,000 limit
specified in (1) above shall be unreduced.
(e) No Participant loan shall take into account the present value of
such Participant's Qualified Voluntary Employee Contribution Account.
(f) Loans shall provide for level amortization with payments to be made
not less frequently than quarterly over a period not to exceed Eve (5)
years. However, loans used to acquire any dwelling unit which, within a
reasonable time, is to be used (determined at the time the loan is
made) as a principal residence of the Participant shall provide for
periodic repayment over a reasonable period of time that may exceed
five (5) years. Notwithstanding the foregoing, loans made prior to
January 1, 1987 which are used to acquire, construct, reconstruct or
substantially rehabilitate any dwelling unit which, within a reasonable
period of time is to be used (determined at the time the loan is made)
as a principal residence of the Participant or a member of his family
(within the meaning of Code Section 267(c)(4)) may provide for periodic
repayment over a reasonable period of time that may exceed five (5)
years. Additionally, loans made prior to January 1, 1987, may provide
for periodic payments which are made less frequently than quarterly and
which do not necessarily result in level amortization.
(g) An assignment or pledge of any portion of a Participant's interest
in the Plan and a loan, pledge, or assignment with respect to any
insurance Contract purchased under the Plan, shall be treated as a loan
under this Section.
(h) Any loan made pursuant to this Section after August 18, 1985 where
the Vested interest of the Participant is used to secure such loan
shall require the written consent of the Participant's spouse in a
manner consistent with Section 6.5(a) provided the spousal consent
requirements of such Section apply to the Plan. Such written consent
must be obtained within the 90-day period prior to the date the loan is
made. Any security interest held by the Plan by reason of an
outstanding loan to the Participant shall be taken into account in
determining the amount of the death benefit or Pre-Retirement Survivor
Annuity. However, no spousal consent shall be required under this
paragraph if the total accrued benefit subject to the security is not
in excess of $3,500.
(i) With regard to any loans granted or renewed on or after the last
day of the first
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Plan Year beginning after December 31, 1988, a Participant loan program
shall be established which must include, but need not be limited to,
the following:
(1) the identity of the person or positions authorized to
administer the Participant loan program;
(2) a procedure for applying for loans;
(3) the basis on which loans will be approved or denied;
(4) limitations, if any, on the types and amounts of loans
offered, including what constitutes a hardship or financial
need if selected in the Adoption Agreement,
(5) the procedure under the program for determining a
reasonable rate of interest;
(6) the types of collateral which may secure a Participant
loan; and
(7) the events constituting default and the steps that will be
taken to preserve plan assets.
Such Participant loan program shall be contained in a
separate written document which, when properly executed, is
hereby incorporated by reference and made a part of this plan.
Furthermore, such Participant loan program may be modified or
amended in writing from time to time without the necessity of
amending this Section of the Plan.
7.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS
At the direction of the Administrator, the Trustee shall, from time to
time, in accordance with the terms of the Plan, make payments out of the Trust
Fund. The Trustee shall not bc responsible in any way for the application of
such payments.
7.6 TRUSTEE'S COMPENSATION AND EXPENSES AND TAXES
The Trustee shall be paid such reasonable compensation as set forth in
the Trustee's fee schedule (if the Trustee has such a schedule) or as agreed
upon in writing by the Employer and the Trustee. An individual serving as
Trustee who already receives full-time pay from the Employer shall not receive
compensation from ,his Plan. In addition, the Trustee shall be reimbursed for
any reasonable expenses, including reasonable counsel fees incurred by it as
Trustee. Such compensation and expenses shall be paid from the Trust Fund unless
paid or advanced by the Employer. All taxes of any kind and all kinds whatsoever
that may be levied or assessed under existing or future laws upon, or in respect
of, the Trust Fund or the income thereof, shall be paid from the Trust Fund.
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7.7 ANNUAL REPORT OF THE TRUSTEE
Within a reasonable period of time after the later of the Anniversary
Date or receipt of the Employer's contribution for each Plan Year, the Trustee,
or its agent, shall furnish to the Employer and Administrator a written
statement of account with respect to the Plan Year for which such contribution
was made setting forth:
(a) the net income, or loss, of the Trust Fund;
(b) the gains, or losses, realized by the Trust Fund upon sales or
other disposition of the assets;
(c) the increase, or decrease, in the value of the Trust Fund;
(d) all payments and distributions made from the Trust Fund; and
(e) such further information as the Trustee and/or Administrator deems
appropriate. The Employer, forthwith upon its receipt of each such
statement of account, shall acknowledge receipt thereof in writing and
advise the Trustee and/or Administrator of its approval or disapproval
thereof. Failure by the Employer to disapprove any such statement of
account within thirty (30) days after its receipt thereof shall be
deemed an approval thereof. The approval by the Employer of any
statement of account shall be binding as to all matters embraced
therein as between the Employer and the Trustee to the same extent as
if the account of the Trustee had been settled by judgment or decree in
an action for a judicial settlement of its account in a court of
competent jurisdiction in which the Trustee, the Employer and all
persons having or claiming an interest in the Plan were parties;
provided, however, that nothing herein contained shall deprive the
Trustee of its right to have its accounts judicially settled if the
Trustee so desires.
7.8 AUDIT
(a) If an audit of the Plan's records shall be required by the Act and
the regulations thereunder for any Plan Year, the Administrator shall
direct the Trustee to engage on behalf of all Participants an
independent qualified public accountant for that purpose. Such
accountant shall, after an audit of the books and records of the Plan
in accordance with generally accepted auditing standards, within a
reasonable period after the close of the Plan Year, furnish to the
Administrator and the Trustee a report of his audit setting forth his
opinion as to whether any statements, schedules or lists, that are
required by Act Section 103 or the Secretary of Labor to be filed with
the Plan's annual report. are presented fairly in conformity with
generally accepted accounting principles applied consistently.
(b) All auditing and accounting fees shall be an expense of and may, at
the election of the Administrator, be paid from the Trust Fund.
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(c) If some or all of the information necessary to enable the
Administrator to comply with Act Section 103 is maintained by a bank,
insurance company, or similar institution, regulated and supervised and
subject to periodic examination by a state or federal agency, it shall
transmit and certify the accuracy of that information to the
Administrator as provided in Act Section 103(b) within one hundred and
twenty ( 120) days after the end of the Plan Year or such other date as
may be prescribed under regulations of the Secretary of Labor.
7.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE
(a) The Trustee may resign at any time by delivering to the Employer,
at least thirty (30) days before its effective date, a written notice
of his resignation.
(b) The Employer may remove the Trustee by mailing by registered or
certified mail, addressed to such Trustee at his last known address, at
least thirty (30) days before its effective date, a written notice of
his removal.
(c) Upon the death, resignation, incapacity, or removal of any Trustee,
a successor may be appointed by the Employer; and such successor, upon
accepting such appointment in writing and delivering same to the
Employer, shall, without further act, become vested with all the
estate, rights, powers, discretions, and duties of his predecessor with
like respect as if he were originally named as a Trustee herein. Until
such a successor is appointed, the remaining Trustee or Trustees shall
have full authority to act under the terms of the Plan.
(d) The Employer may designate one or more successors prior to the
death, resignation, incapacity, or removal of a Trustee. In the event a
successor is so designated by the Employer and accepts such
designation, the successor shall, without further act, become vested
with all the estate, rights, powers, discretions, and duties of his
predecessor with the like effect as if he were originally named as
Trustee herein immediately upon the death, resignation, incapacity, or
removal of his predecessor.
(e) Whenever any Trustee hereunder ceases to serve as such, he shall
furnish to the Employer and Administrator a written statement of
account with respect to the portion of the Plan Year during which he
served as Trustee. This statement shall be either (i) included as part
of the annual statement of account for the Plan Year required under
Section 7.7 or (ii) set forth in a special statement. Any such special
statement of account should be rendered to the Employer no later than
the due date of the annual statement of account for the Plan Year. The
procedures set forth in Section 7.7 for the approval by the Employer of
annual statements of account shall apply to any special statement of
account rendered hereunder and approval by the Employer of any such
special statement in the manner provided in Section 7.7 shall have the
same effect upon the statement as the Employer's approval of an annual
statement of account. No successor to the Trustee shall have any duty
or responsibility to investigate the acts or transactions of any
predecessor
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who has rendered all statements of account required by Section 7.7 and
this subparagraph.
7.10 TRANSFER OF INTEREST
Notwithstanding any other provision contained in this Plan, the Trustee
at the direction of the Administrator shall transfer the Vested interest, if
any, of such Participant in his account to another trust forming part of a
pension, profit sharing, or stock bonus plan maintained by such Participant's
new employer and represented by said employer in writing as meeting the
requirements of Code Section 401(a), provided that the trust to which such
transfers are made permits the transfer to be made.
(a) Notwithstanding any provision of the plan to the contrary, with
respect to distributions made after December 31, 1992, a Participant
shall be permitted to elect to have any "eligible rollover
distribution" transferred directly to an "eligible retirement plan"
specified by the Participant. The Plan provisions otherwise applicable
to distributions continue to apply to the direct transfer option. The
Participant shall, in the time and manner prescribed by the
Administrator. Specify the amount to be directly transferred and the
"eligible retirement plan" to receive the transfer, Any portion of a
distribution which is not transferred shall be distributed to the
Participant.
(b) For purposes of this Section, the term "eligible rollover.
distribution" means any distribution other than a distribution of
substantially equal periodic payments over the life or life expectancy
of the Participant (or joint life or joint life expectancies of the
Participant and the designated beneficiary) or a distribution over a
period certain of ten years or more. Amounts required to be distributed
under Code Section 401(a)(9) are not eligible rollover distributions.
The direct transfer option described in subsection (a) applies only to
eligible rollover distributions which would otherwise be includible in
gross income if not transferred.
(c) For purposes of this Section, the term "eligible retirement plan"
means an individual retirement account as described in Code Section
408(a), an individual retirement annuity as described in Code Section
408(b), an annuity plan as described in Code Section 403(a), or a
defined contribution plan as described in Code Section 401(a) which is
exempt from tax under Code Section 501(a) and which accepts rollover
distributions.
(d) The election described in subsection (a) also applies to the
surviving spouse after the Participant's death; however, distributions
to the surviving spouse may only be transferred to an individual
retirement account or individual retirement annuity. For purposes of
subsection (a), a spouse or former spouse who is the alternate payee
under a qualified domestic relations order as defined in Code Section
414(p) will be treated as the Participant.
7.11 TRUSTEE INDEMNIFICATION
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The Employer agrees to indemnify and save harmless the Trustee against
any and all claims, losses, damages, expenses and liabilities the Trustee may
incur in the exercise and performance of the Trustee's powers and duties
hereunder, unless the same are determined to be due to gross negligence or
willful misconduct.
7.12 EMPLOYER SECURITIES AND REAL PROPERTY
The Trustee shall be empowered to acquire and hold "qualifying Employer
securities" and "qualifying Employer real property," as those terms are defined
in the Act. However, no more than 100%, in the case of a Profit Sharing Plan or
401(k) Plan or 10%, in the case of a Money Purchase Plan of the fair market
value of all the assets in the Trust Fund may be invested in "qualifying
Employer securities" and "qualifying Employer real property."
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ARTICLE VIII
AMENDMENT, TERMINATION, AND MERGERS
8.1 AMENDMENT
(a) The Employer shall have the right at any time to amend this Plan
subject to the limitations of this Section. However, any amendment
which affects the rights, duties or responsibilities of the Trustee and
Administrator may only be made with the Trustee's and Administrator's
written consent. Any such amendment shall become effective as provided
therein upon its execution. The Trustee shall not be required to
execute any such amendment unless the amendment affects the duties of
the Trustee hereunder.
(b) The Employer may (1) change the choice of options in the Adoption
Agreement; (2) add overriding language in the Adoption Agreement when
such language is necessary to satisfy Code Sections 415 or 416 because
of the required aggregation of multiple plans; and (3) add certain
model amendments published by the Internal Revenue Service which
specifically provide that their adoption will not cause the Plan to be
treated as an individually designed plan. An Employer that amends the
Plan for any other reason. including a waiver of the minimum funding
requirement under Code Section 412(d), will no longer participate in
this Regional Prototype Plan and will be considered to have an
individually designed plan.
(c) The Employer expressly delegates authority to the sponsoring
organization of this Plan, the right to amend this Plan by submitting a
copy of the amendment to each Employer who has adopted this Plan after
first having received a ruling or favorable determination from the
Internal Revenue Service that the Plan as amended qualifies under Code
Section 401(a) and the Act.
(d) No amendment to the Plan shall be effective if it authorizes or
permits any part of the Trust Fund (other than such part as is required
to pay taxes and administration expenses) to be used for or diverted to
any purpose other than for the exclusive benefit of the Participants or
their Beneficiaries or estates, or causes any reduction in the amount
credited to the account of any Participant; or causes or permits any
portion of the Trust Fund to revert to or become property of the
Employer.
(e) Except as permitted by Regulations (including Regulation
1.411(d)(4), no Plan amendment or transaction having the effect of a
Plan amendment (such as a merger, plan transfer or similar transaction)
shall be effective if it eliminates or reduces any "Section 411(d)(6)
protected benefit" or adds or modifies conditions relating to "Section
411(d)(6) protected benefits" the result of which is a further
restriction on such benefit unless such protected benefits are
preserved with respect to benefits accrued as of the later of the
adoption date or effective date of the amendment. "Section 411(d)(6)
protected benefits" are benefits described in Code Section
411(d)(6)(A), early retirement benefits and retirement-type subsidies,
and optional forms of benefit.
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8.2 TERMINATION
(a) The Employer shall have the right at any time to terminate the Plan
by delivering to the Trustee and Administrator written notice of such
termination. Upon any full or partial termination all amounts credited
to the affected Participants' Combined Accounts shall become 100%
Vested and shall not thereafter be subject to forfeiture, and all
unallocated amounts shall be allocated to the accounts of all
Participants in accordance with the provisions hereof.
(b) Upon the full termination of the Plan, the Employer shall direct
the distribution of the assets to Participants in a manner which is
consistent with and satisfies the provisions of Section 6.5.
Distributions to a Participant shall be made in cash (or in property if
permitted in the Adoption Agreement) or through the purchase of
irrevocable nontransferable deferred commitments from the Insurer.
Except as permitted by Regulations, the termination of the Plan shall
not result in the reduction of "Section 411(d)(6) protected benefits"
as described in Section 8.1.
8.3 MERGER OR CONSOLIDATION
This Plan may be merged or consolidated with, or its assets and/or
liabilities may be transferred to any other plan only if the benefits which
would be received by a Participant of this Plan, in the event of a termination
of the plan immediately after such transfer, merger or consolidation, are at
least equal to the benefits the Participant would have received if the Plan had
terminated immediately before the transfer, merger or consolidation and such
merger or consolidation does not otherwise result in the elimination or
reduction of any "Section 41 l(d)(6) protected benefits" as described in Section
8.1(c).
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ARTICLE IX
MISCELLANEOUS
9.1 EMPLOYER ADOPTIONS
(a) Any organization may become the Employer hereunder by executing the
Adoption Agreement in form satisfactory to the Trustee, and it shall
provide such additional information as the Trustee may require. The
consent of the Trustee to act as such shall be signified by its
execution of the Adoption Agreement.
(b) Except as otherwise provided in this Plan, the affiliation of the
Employer and the participation of its Participants shall be separate
and apart from that of any other employer and its participants
hereunder.
9.2 PARTICIPANT'S RIGHTS
This Plan shall not be deemed to constitute a contract between the
Employer and any Participant or to be a consideration or an inducement for the
employment of any Participant or Employee. Nothing contained in this Plan shall
be deemed to give any Participant or Employee the right to be retained in the
service of the Employer or to interfere with the right of the Employer to
discharge any Participant or Employee at any time regardless of the effect which
such discharge shall have upon him as a Participant of this Plan.
9.3 ALIENATION
(a) Subject to the exceptions provided below, no benefit which shall be
payable to any person (including a Participant or his Beneficiary)
shall be subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, or charge, and any attempt
to anticipate, alienate, sell, transfer, assign, pledge, encumber, or
charge the same shall be void; and no such benefit shall in any manner
be liable for, or subject to, the debts, contracts, liabilities,
engagements, or torts of any such person, nor shall it be subject to
attachment or legal process for or against such person, and the same
shall not be recognized except to such extent as may be required by
law.
(b) This provision shall not apply to the extent a Participant or
Beneficiary is indebted to the Plan, for any reason, under any
provision of this Plan. At the time a distribution is to be made to or
for a Participant's or Beneficiary's benefit, such proportion of the
amount to be distributed as shall equal such indebtedness shall be paid
to the Plan, to apply against or discharge such indebtedness. Prior to
making a payment, however, the Participant or Beneficiary must be given
written notice by the Administrator that such indebtedness is to be so
paid in whole or pan from his Participant's Combined Account. If the
Participant or Beneficiary does not agree that the indebtedness is a
valid claim against his Vested Participant's Combined Account, he shall
be entitled to a review of the validity of the claim in accordance with
procedures provided in Sections 2.12 and 2.13.
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(c) This provision shall not apply to a "qualified domestic relations
order" defined in Code Section 414(p), and those other domestic
relations orders permitted to be so treated by the Administrator under
the provisions of the Retirement Equity Act of 1984. The Administrator
shall establish a written procedure to determine the qualified status
of domestic relations orders and to administer distributions under such
qualified orders. Further, to the extent provided under a "qualified
domestic relations order." a former spouse of a Participant shall be
treated as the spouse or surviving spouse for all purposes under the
Plan.
9.4 CONSTRUCTION OF PLAN
This Plan and Trust shall be construed and enforced according to the
Act and the laws of the State or Commonwealth in which the Employer's principal
office is located, other than its laws respecting choice of law, to the extent
not pre-empted by the Act.
9.5 GENDER AND NUMBER
Wherever any words are used herein in the masculine, feminine or neuter
gender, they shall be construed as though they were also used in another gender
in all cases where they would so apply, and whenever any words are used herein
in the singular or plural form, they shall be construed as though they were also
used in the other form in all cases where they would so apply.
9.6 LEGAL ACTION
In the event any claim, suit, or proceeding is brought regarding the
Trust and/or Plan established hereunder to which the Trustee or the
Administrator may be a party, and such claim, suit, or proceeding is resolved in
favor of the Trustee or Administrator, they shall be entitled to be reimbursed
from the Trust Fund for any and all costs, attorney's fees, and other expenses
pertaining thereto incurred by them for which they shall have become liable.
9.7 PROHIBITION AGAINST DIVERSION OF FUNDS
(a) Except as provided below and otherwise specifically permitted by
law, it shall be impossible by operation of the Plan or of the Trust,
by termination of either, by power of revocation or amendment, by the
happening of any contingency, by collateral arrangement or by any other
means, for any part of the corpus or income of any Trust Fund
maintained pursuant to the Plan or any funds contributed thereto to be
used for, or diverted to, purposes other than the exclusive benefit of
Participants, Retired Participants, or their Beneficiaries.
(b) In the event the Employer shall make a contribution under a mistake
of fact pursuant to Section 403(c)(2)(A) of the Act. the Employer may
demand repayment of such contribution at any time within one (1) year
following the time of payment and the Trustees shall return such amount
to the Employer within the one (1) year period. Earnings of the Plan
attributable to the contributions may not be returned to the Employer
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but any losses attributable thereto must reduce the amount so returned.
9.8 BONDING
Every Fiduciary, except a bank or an insurance company, unless exempted
by the Act and regulations thereunder, shall be bonded in an amount not less
than 10% of the amount of the funds such Fiduciary handles; provided, however,
that the minimum bond shall be $1,000 and the maximum bond, $500,000. The amount
of funds handled shall be determined at the beginning of each Plan Year by the
amount of funds handled by such person, group, or class to be covered and their
predecessors, if any, during the preceding Plan Year, or if there is no
preceding Plan Year, then by the amount of the funds to be handled during the
then current year. The bond shall provide protection to the Plan against any
loss by reason of acts of fraud or dishonesty by the Fiduciary alone or in
connivance with others. The surety shall be a corporate surety company (as such
term is used in Act Section 412(a)(2)), and the bond shall be in a form approved
by the Secretary of Labor. Notwithstanding anything in the Plan 10 the contrary,
the cost of such bonds shall be an expense of and may, at the election of the
Administrator, be paid from the Trust Fund or by the Employer.
9.9 EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE
Neither the Employer nor the Trustee, nor their successors, shall be
responsible for the validity of any Contract issued hereunder or for the failure
on the part of the Insurer to make payments provided by any such Contract, or
for the action of any person which may delay payment or render a Contract null
and void or unenforceable in whole or in part.
9.10 INSURER'S PROTECTIVE CLAUSE
The Insurer who shall issue Contracts hereunder shall not have any
responsibility for the validity of this Plan or for the tax or legal aspects of
this Plan. The Insurer shall be protected and held harmless in acting in
accordance with any written direction of the Trustee, and shall have no duty to
see to the application of any funds paid to the Trustee, nor be required to
question any actions directed by the Trustee. Regardless of any provision of
this Plan, the Insurer shall not be required to take or permit any action or
allow any benefit or privilege contrary to the terms of any Contract which it
issues hereunder, or the rules of the Insurer.
9.11 RECEIPT AND RELEASE FOR PAYMENTS
Any payment to any Participant, his legal representative, Beneficiary,
or to any guardian or committee appointed for such Participant or Beneficiary in
accordance with the provisions of this Plan, shall, to the extent thereof, be in
full satisfaction of all claims hereunder against the Trustee and the Employer.
9.12 ACTION BY THE EMPLOYER
Whenever the Employer under the terms of the Plan is permitted or
required to do or
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perform any act or matter or thing, it shall be done and performed by a person
duly authorized by its legally constituted authority.
9.13 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY
The "named Fiduciaries" of this Plan are (1) the Employer, (2) the
Administrator, (3) the Trustee, and (4) any Investment Manager appointed
hereunder. The named Fiduciaries shall have only those specific powers, duties,
responsibilities, and obligations as are specifically given them under the Plan,
In general, the Employer shall have the sole responsibility for making the
contributions provided for under Section 4.1; and shall have the sole authority
to appoint and remove the Trustee and the Administrator; to formulate the Plan's
"funding policy and method"; and to amend the elective provisions of the
Adoption Agreement or terminate, in whole or in part, the Plan. The
Administrator shall have the sole responsibility for the administration of the
Plan, which responsibility is specifically described in the Plan. The Trustee
shall have the sole responsibility of management of the assets held under the
Trust, except those assets, the management of which has been assigned to an
Investment Manager, who shall be solely responsible for the management of the
assets assigned to it, all as specifically provided in the Plan. Each named
Fiduciary warrants that any directions given, information furnished. or action
taken by it shall be in accordance with the provisions of the Plan, authorizing
or providing for such direction, information or action. Furthermore, each named
Fiduciary may rely upon any such direction, information or action of another
named Fiduciary as being proper under the Plan, and is not required under the
Plan to inquire into the propriety of any such direction, information or action.
It is intended under the Plan that each named Fiduciary shall be responsible for
the proper exercise of his own powers, duties, responsibilities and obligations
under the Plan. No named Fiduciary shall guarantee the Trust Fund in any manner
against investment loss or depreciation in asset value. Any person or group may
serve in more than one Fiduciary capacity.
9.14 HEADINGS
The headings and subheadings of this Plan have been inserted for
convenience of reference and are to be ignored in any construction of the
provisions hereof.
9.15 APPROVAL BY INTERNAL REVENUE SERVICE
(a) Notwithstanding anything herein to the contrary, if, pursuant to a
timely application filed by or in behalf of the Plan, the Commissioner
of Internal Revenue Service or his delegate should determine that the
Plan does not initially qualify as a tax-exempt plan under Code
Sections 401 and 501, and such determination is not contested, or if
contested, is finally upheld, then if the Plan is a new plan, it shall
be void ab initio and all amounts contributed to the Plan, by the
Employer, less expenses paid, shall be returned within one year and the
Plan shall terminate, and the Trustee shall be discharged from all
further obligations. If the disqualification relates to an amended
plan, then the Plan shall operate as if it had not been amended and
restated.
(b) Except as specifically stated in the Plan, any contribution by the
Employer to the
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Trust Fund is conditioned upon the deductibility of the contribution by
the Employer under the Code and, to the extent any such deduction is
disallowed, the Employer may within one (1) year following a final
determination of the disallowance, whether by agreement with the
Internal Revenue Service or by final decision of a court of competent
jurisdiction, demand repayment of such disallowed contribution and the
Trustee shall return such contribution within one (1) year following
the disallowance. Earnings of the Plan attributable to the excess
contribution may not be returned to the Employer, but any losses
attributable thereto must reduce the amount so returned.
9.16 UNIFORMITY
All provisions of this Plan shall be interpreted and applied in a
uniform, nondiscriminatory manner.
9.17 PAYMENT OF BENEFITS
Benefits under this Plan shall be paid, subject to Section 6.10 and
Section 6.11 only upon death, Total and Permanent Disability, normal or early
retirement. termination of employment, or upon Plan Termination.
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ARTICLE X
PARTICIPATING EMPLOYERS
10.1 ELECTION TO BECOME A PARTICIPATING EMPLOYER
Notwithstanding anything herein to the contrary, with the consent of
the Employer and Trustee, any Affiliated Employer may adopt this Plan and all of
the provisions hereof. and participate herein and be known as a Participating
Employer, by a properly executed document evidencing said intent and will of
such Participating Employer.
10.2 REQUIREMENTS OF PARTICIPATING EMPLOYERS
(a) Each Participating Employer shall be required to select the same
Adoption Agreement provisions as those Selected by the Employer other
than the Plan Year, the Fiscal Year, and such other items that must, by
necessity, vary among employers.
(b) Each such Participating Employer shall be required to use the same
Trustee as provided in this Plan.
(c) The Trustee may, but shall not be required to, commingle, hold and
invest as one Trust Fund all contributions made by Participating
Employers, as well as all increments thereof.
(d) The transfer of any Participant from or to an Employer
participating in this Plan, whether he be an Employee of the Employer
or a Participating Employer, shall not affect such Participant's rights
under the Plan, and all amounts credited to such Participant's Combined
Account as well as his accumulated service time with the transferor or
predecessor, and his length of participation in the Plan, shall
continue to his credit.
(e) Any expenses of the Plan which are to be paid by the Employer or
borne by the Trust Fund shall be paid by each Participating Employer in
the same proportion that the total amount standing to the credit of all
Participants employed by such Employer bears to the total standing to
the credit of all Participants.
10.3 DESIGNATION OF AGENT
Each Participating Employer shall be deemed to be a part of this Plan;
provided, however, that with respect to all of its relations with the Trustee
and Administrator for the purpose of this Plan, each Participating Employer
shall be deemed to have designated irrevocably the Employer as its agent. Unless
the context of the Plan clearly indicates the contrary, the word "Employer"
shall be deemed to include each Participating Employer as related to its
adoption of the Plan.
10.4 EMPLOYEE TRANSFERS
It is anticipated that an Employee may be transferred between
Participating Employers,
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and in the event of any such transfer, the Employee involved shall carry with
him his accumulated service and eligibility. No such transfer shall effect a
termination of employment hereunder, and the Participating Employer to which the
Employee is transferred shall thereupon become obligated hereunder with respect
to such Employee in the same manner as was the Participating Employer from whom
the Employee was transferred.
10.5 PARTICIPATING EMPLOYER'S CONTRIBUTION AND FORFEITURES
Any contribution or Forfeiture subject to allocation during each Plan
Year shall be allocated among all Participants of all Participating Employers in
accordance with the provisions of this Plan. On the basis of the information
furnished by the Administrator, the Trustee shall keep separate books and
records concerning the affairs of each Participating Employer hereunder and as
to the accounts and credits of the Employees of each Participating Employer. The
Trustee may, but need not, register Contracts so as to evidence that a
particular Participating Employer is the interested Employer hereunder, but in
the event of an Employee transfer from one Participating Employer to another,
the employing Employer shall immediately notify the Trustee thereof.
10.6 AMENDMENT
Amendment of this Plan by the Employer at any time when there shall be
a Participating Employer hereunder shall only be by the written action of each
and every Participating Employer and with the consent of the Trustee where such
consent is necessary in accordance with the terms of this Plan.
10.7 DISCONTINUANCE OF PARTICIPATION
Except in the case of a Standardized Plan, any Participating Employer
shall be permitted to discontinue or revoke its participation in the Plan at any
time. At the time of any such discontinuance or revocation, satisfactory
evidence thereof and of any applicable conditions imposed shall be delivered to
the Trustee. The Trustee shall thereafter transfer, deliver and assign Contracts
and other Trust Fund assets allocable to the Participants of such Participating
Employer to such new Trustee as shall have been designated by such Participating
Employer, in the event that it has established a separate pension plan for its
Employees provided, however, that no such transfer shall be made if the result
is the elimination or reduction of any "Section 41l(d)(6) protected benefits" in
accordance with Section 8.1(c). If no successor is designated, the Trustee shall
retain such assets for the Employees of said Participating Employer pursuant to
the provisions of Article VII hereof. In no such event shall any part of the
corpus or income of the Trust Fund as it relates to such Participating Employer
be used for or diverted for purposes other than for the exclusive benefit of the
Employees of such Participating Employer.
10.8 ADMINISTRATOR'S AUTHORITY
The Administrator shall have authority to make any and all necessary
rules or regulations, binding upon all Participating Employers and all
Participants, to effectuate the purpose of this
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Article.
10.9 PARTICIPATING EMPLOYER CONTRIBUTION FOR AFFILIATE
If any Participating Employer is prevented in whole or in part from
making a contribution which it would otherwise have made under the Plan by
reason of having no current or accumulated earnings or profits, or because such
earnings or profits are less than the contribution which it would otherwise have
made, then, pursuant to Code Section 404(a)(3)(B), so much of the contribution
which such Participating Employer was so prevented from making may be made, for
the benefit of the participating employees of such Participating Employer, by
other Participating Employers who are members of the same affiliated group
within the meaning of Code Section 1504 to the extent of their current or
accumulated earnings or profits, except that such contribution by each such
other Participating Employer shall be limited to the proportion of its total
current and accumulated earnings or profits remaining after adjustment for its
contribution to the Plan made without regard to this paragraph which the total
prevented contribution bears to the total current and accumulated earnings or
profits of all the Participating Employers remaining after adjustment for all
contributions made to the Plan without regard to this paragraph.
A Participating Employer on behalf of whose employees a contribution is
made under this paragraph shall not be required to reimburse the contributing
Participating Employers.
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ARTICLE XI
CASH OR DEFERRED PROVISIONS
Notwithstanding any provisions in the Plan to the contrary, the
provisions of this Article shall apply with respect to any 401(k) Profit Sharing
Plan.
Notwithstanding anything in this Article to the contrary, effective as
of the Plan Year in which this amendment becomes effective, the Actual Deferral
Percentage Test and the Actual Contribution Percentage Test shall be applied
(and adjusted) by applying the Family Member aggregation rules of Code Section
414(q)(6).
11.1 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION
For each Plan Year, the Employer shall contribute to the Plan:
(a) The amount of the total salary reduction elections of all
Participants made pursuant to Section 11.2(a), which amount shall be
deemed an Employer's Elective Contribution, plus
(b) If specified in E3 of the Adoption Agreement, a matching
contribution equal to the percentage specified in the Adoption
Agreement of the Deferred Compensation of each Participant eligible to
share in the allocations of the matching contribution, which amount
shall be deemed an Employer's Non-Elective or Elective Contribution as
selected in the Adoption Agreement, plus
(c) If specified in E4 of the Adoption Agreement, a discretionary
amount, if any, which shall be deemed an Employer's Non-Elective
Contribution, plus
(d) If specified in E5 of the Adoption Agreement, a Qualified
Non-Elective Contribution.
(e) Notwithstanding the foregoing, however, the Employer's
contributions for any Fiscal Year shall not exceed the maximum amount
allowable as a deduction to the Employer under the provisions of Code
Section 404. All contributions by the Employer shall be made in cash or
in such property as is acceptable to the Trustee.
(f) Except, however, to the extent necessary to provide the top heavy
minimum allocations, the Employer shall make a contribution even if it
exceeds current or accumulated Net Profit or the amount which is
deductible under Code Section 404.
(g) Employer Elective Contributions accumulated through payroll
deductions shall be paid to the Trustee as of the earliest date on
which such contributions can reasonably be segregated from the
Employer's general assets, but in any event within ninety (90) days
from the date on which such amounts would otherwise have been payable
to the Participant in cash. The provisions of Department of Labor
regulations 2510.3-102 are
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incorporated herein by reference. Furthermore, any additional Employer
contributions which are allocable to the Participant's Elective Account
for a Plan Year shall be paid to the Plan no later than the
twelve-month period immediately following the close of such Plan Year.
11.2 PARTICIPANT'S SALARY REDUCTION ELECTION
(a) If selected in the Adoption Agreement, each Participant may elect
to defer his Compensation which would have been received in the Plan
Year, but for the deferral election, subject to the limitations of this
Section and the Adoption Agreement. A deferral election (or
modification of an earlier election) may not be made with respect to
Compensation which is currently available on or before the date the
Participant executed such election, or if later, the latest of the date
the Employer adopts this cash or deferred arrangement, or the date such
arrangement first became effective. Any elections made pursuant to this
Section shall become effective as soon as is administratively feasible.
Additionally, if elected in the Adoption Agreement, each
Participant may elect to defer and have allocated for a Plan Year all
or a portion of any cash bonus attributable to services performed by
the Participant for the Employer during such Plan Year and which would
have been received by the Participant on or before two and one-half
months following the end of the Plan Year but for the deferral. A
deferral election may not be made with respect to cash bonuses which
are currently available on or before the date the Participant executed
such election. Notwithstanding the foregoing, cash bonuses attributable
to services performed by the Participant during a Plan Year but which
are to be paid to the Participant later than two and one-half months
after the close of such Plan Year will be subjected to whatever
deferral election is in effect at the time such cash bonus would have
otherwise been received.
The amount by which Compensation and/or cash bonuses are
reduced shall be that Participant's Deferred Compensation and be
treated as an Employer Elective Contribution and allocated to that
Participant's Elective Account.
Once made, a Participant's election to reduce Compensation
shall remain in effect until modified or terminated. Modifications may
be made as specified in the Adoption Agreement, and terminations may be
made at any time. Any modification or termination of an election will
become effective as soon as is administratively feasible.
(b) The balance in each Participant's Elective Account shall be fully
Vested at all times and shall not be subject to Forfeiture for any
reason.
(c) Amounts held in the Participant's Elective Account and Qualified
Non-Elective Account may be distributable as permitted under the Plan,
but in no event prior to the earlier of,
(1) a Participant's termination of employment, Total and
Permanent
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Disability, or death;
(2) a Participant's attainment of age 59 1/2;
(3) the proven financial hardship of a Participant, subject to
the limitations of Section 11.8;
(4) the termination of the Plan without the existence at the
time of Plan termination of another defined contribution plan
(other than an employee stock ownership plan as defined in
Code Section 4975(e)(7)) or the establishment of a successor
defined contribution plan (other than an employee stock
ownership plan as defined in Code Section 4975(c)(7)) by the
Employer or an Affiliated Employer within the period ending
twelve months after distribution of all assets from the Plan
maintained by the Employer;
(5) the date of the sale by the Employer to an entity that is
not an Affiliated Employer of substantially all of the assets
(within the meaning of Code Section 409(d)(2)) with respect to
a Participant who continues employment with the corporation
acquiring such assets; or
(6) the date of the sale by the Employer or an Affiliated
Employer of its interest in a subsidiary (within the meaning
of Code Section 409(d)(3)) to an entity that is not an
Affiliated Employer with respect to a Participant who
continues employment with such subsidiary.
(d) In any Plan Year beginning after December 31, 1986, a Participant's
Deferred Compensation made under this Plan and all other plans,
contracts or arrangements of the Employer maintaining this Plan shall
not exceed the limitation imposed by Code Section 402(g), as in effect
for the calendar year in which such Plan Year began. If such dollar
limitation is exceeded solely from elective deferrals made under this
Plan or any other Plan maintained by the Employer, a Participant will
be deemed to have notified the Administrator of such excess amount
which shall be distributed in a manner consistent with Section 11.2(f).
This dollar limitation shall be adjusted annually pursuant to the
method provided in Code Section 415(d) in accordance with Regulations.
(e) In the event a Participant has received a hardship distribution
pursuant to Regulation 1.401(k)-1(d)(2)(iii)(B) from any other plan
maintained by the Employer or from his Participant's Elective Account
pursuant to Section 11.8, then such Participant shall not be permitted
to elect to have Deferred Compensation contributed to the Plan on his
behalf for a period of twelve (12) months following the receipt of the
distribution. Furthermore, the dollar limitation under Code Section
402(g) shall be reduced, with respect to the Participant's taxable year
following the taxable year in which the hardship distribution was made,
by the amount of such Participant's Deferred Compensation, if any, made
pursuant to this Plan (and any other plan maintained by the Employer)
for the taxable year of the hardship distribution.
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(f) If a Participant's Deferred Compensation under this Plan together
with any elective deferrals (as defined in Regulation 1.402(g)-1(b))
under another qualified cash or deferred arrangement (as defined in
Code Section 401(k)), a simplified employee pension (as defined in Code
Section 408(k)), a salary reduction arrangement (within the meaning of
Code Section 3121(a)(5)(D)), a deferred compensation plan under Code
Section 457, or a trust described in Code Section 501(c)(18)
cumulatively exceed the limitation imposed by Code Section 402(g) (as
adjusted annually in accordance with the method provided in Code
Section 415(d) pursuant to Regulations) for such Participant's taxable
year, the Participant may, not later than March 1st following the close
of his taxable year, notify the Administrator in writing of such excess
and request that his Deferred Compensation under this Plan be reduced
by an amount specified by the Participant. In such event, the
Administrator shall direct the Trustee to distribute such excess amount
(and any Income allocable to such excess amount) to the Participant not
later than the first April 15th following the close of the
Participant's taxable year. Distributions in accordance with this
paragraph may be made for any taxable year of the Participant which
begins after December 31, 1986. Any distribution of less than the
entire amount of Excess Deferred Compensation and Income shall be
treated as a pro rata distribution of Excess Deferred Compensation and
Income. The amount distributed shall not exceed the Participant's
Deferred Compensation under the Plan for the taxable year. Any
distribution on or before the last day of the Participant's taxable
year must satisfy each of the following conditions:
(1) the Participant shall designate the distribution as Excess
Deferred Compensation;
(2) the distribution must be made after the date on which the
Plan received the Excess Deferred Compensation, and
(3) the Plan must designate the distribution as a distribution
of Excess Deferred Compensation.
Any distribution under this Section shall be made
first from unmatched Deferred Compensation and, thereafter,
simultaneously from Deferred Compensation which is matched and
matching contributions which relate to such Deferred
Compensation. However, any such matching contributions which
are not Vested shall be forfeited in lieu of being
distributed.
For the purpose of this Section, "Income" means the
amount of income or loss allocable to a Participant's Excess
Deferred Compensation and shall be equal to the sum of the
allocable gain or loss for the taxable year of the Participant
and the allocable gain or loss for the period between the end
of the taxable year of the Participant and the date of
distribution ("gap period"). The income or loss allocable to
each such period is calculated separately and is determined by
multiplying the income or loss allocable to the Participant's
Deferred
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Compensation for the respective period by a fraction. The
numerator of the fraction is the Participant's Excess Deferred
Compensation for the taxable year of the Participant. The
denominator is the balance, as of the last day of the
respective period. of the Participant's Elective Account that
is attributable to the Participant's Deferred Compensation
reduced by the gain allocable to such total amount for the
respective period and increased by the loss allocable to such
total amount for the respective period.
In lieu of the "fractional method" described above, a
"safe harbor method" may be used to calculate the allocable
income or loss for the "gap period." Under such "safe harbor
method," allocable income or loss for the "gap period" shall
be deemed to equal ten percent (10%) of the income or loss
allocable to a Participant's Excess Deferred Compensation for
the taxable year of the Participant multiplied by the number
of calendar months in the "gap period." For purposes of
determining the number of calendar months in the "gap period,"
a distribution occurring on or before the fifteenth day of the
month shall be treated as having been made on the last day of
the preceding month and a distribution occurring after such
fifteenth day shall be treated as having been made on the
first day of the next subsequent month.
Income or loss allocable to any distribution of
Excess Deferred Compensation on or before the last day of the
taxable year of the Participant shall be calculated from the
first day of the taxable year of the Participant to the date
on which the distribution is made pursuant to either the
"fractional method" or the "safe harbor method."
Notwithstanding the above, for any distribution under
this Section which is made after August 15, 1991, such
distribution shall not include any income for the "gap
period". Further provided, for any distribution under this
Section which is made after August 15, 1991, the amount of
Income may be computed using a reasonable method that is
consistent with Section 4.3(c), provided such method is used
consistently for all Participants and for all such
distributions for the Plan Year.
Notwithstanding the above, for the 1987 calendar
year, Income during the "gap period" shall not be taken into
account.
(g) Notwithstanding the above, a Participant's Excess Deferred
Compensation shall be reduced, but not below zero, by any distribution
and/or re-characterization of Excess Contributions pursuant to Section
11.5(a) for the Plan Year beginning with or within the taxable year of
the Participant.
(h) At Normal Retirement Date, or such other date when the Participant
shall be entitled to receive benefits. the fair market value of the
Participant's Elective Account shall be used to provide benefits to the
Participant or his Beneficiary.
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(i) Employer Elective Contributions made pursuant to this Section may
be segregated into a separate account for each Participant in a
federally insured savings account, certificate of deposit in a bank or
savings and loan association, money market certificate, or other
short-term debt security acceptable to the Trustee until such time as
the allocations pursuant to Section 11.3 have been made.
(j) The Employer and the Administrator shall adopt a procedure
necessary to implement the salary reduction elections provided for
herein.
11.3 ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS
(a) The Administrator shall establish and maintain an account in the
name of each Participant to which the Administrator shall credit as of
each Anniversary Date, or other valuation date, all amounts allocated
to each such Participant as set forth herein.
(b) The Employer shall provide the Administrator with all information
required by the Administrator to make a proper allocation of the
Employer's contributions for each Plan Year. Within a reasonable period
of time after the date of receipt by the Administrator of such
information, the Administrator shall allocate such contribution as
follows:
(1) With respect to the Employer's Elective Contribution made
pursuant to Section 11.1(a), to each Participant's Elective
Account in an amount equal to each such Participant's Deferred
Compensation for the year.
(2) With respect to the Employer's Matching Contribution made
pursuant to Section 11.1(b), to each Participant's Account, or
Participant's Elective Account as selected in E3 of the
Adoption Agreement, in accordance with Section 11.1(b).
Except, however, a Participant who is not credited
with a Year of Service during any Plan Year shall or shall not
share in the Employer's Matching Contribution for that year as
provided in E3 of the Adoption Agreement. However, for Plan
Years beginning after 1989, if this is a standardized Plan, a
Participant shall share in the Employer's Matching
Contribution regardless of Hours of Service.
(3) With respect to the Employer's Non-Elective Contribution
made pursuant to Section 1.1(c), to each Participant's Account
in accordance with the provisions of Sections 4.3(b)(2) or
4.3(b)(3), whichever is applicable, 4.3(k) and 4.3(l).
(4) With respect to the Employer's Qualified Non-Elective
Contribution made pursuant to Section 11.1(d), to each
Participant's Qualified Non-Elective Contribution Account in
the same proportion that each such Participant's Compensation
for the year bears to the total Compensation of all
Participants for
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such year. However, for any Plan Year beginning prior to
January 1, 1990, and if elected in the non-standardized
Adoption Agreement for any Plan Year beginning on or after
January 1, 1990, a Participant who is not credited with a Year
of Service during any Plan Year shall not share in the
Employer's Qualified Non-Elective Contribution for that year,
unless required pursuant to Section 4.3(h). In addition, the
provisions of Sections 4.3(k) and 4.3(o) shall apply with
respect to the allocation of the Employer's Qualified
Non-Elective contribution.
(c) Notwithstanding anything in the Plan to the contrary, for Plan
Years beginning after December 31, 1988, in determining whether a
Non-Key Employee has received the required minimum allocation pursuant
to Section 4.3(l) such Non-Key Employee's Deferred Compensation and
matching contributions used to satisfy the "Actual Deferral Percentage"
test pursuant to Section 11.4(a) or the "Actual Contribution
Percentage" test of Section 11.6(a) shall not be taken into account.
(d) Notwithstanding anything herein to the contrary, participants who
terminated employment during the Plan Year shall share in the salary
reduction contributions made by the Employer for the year of
termination without regard to the Hours of Service credited.
(e) Notwithstanding anything herein to the contrary (other than
Sections 11.3(d) and 11.3(g)), any Participant who terminated
employment during the Plan Year for reasons other than death, Total and
Permanent Disability, or retirement shall or shall not share in the
allocations of the Employer's Matching Contribution made pursuant to
Section 11.1(b). the Employer's Non-Elective Contributions made
pursuant to Section 11.1(c). the Employer's Qualified Non-Elective
Contribution made pursuant to Section 11.1(d), and Forfeitures as
provided in the Adoption Agreement. Notwithstanding the foregoing. for
Plan Years beginning, after 1989, if this is a standardized Plan, any
such terminated Participant shall share in such allocations provided
the terminated Participant completed more than 500 Hours of Service.
(f) Notwithstanding anything herein to the contrary, Participants
terminating for reasons of death, Total and Permanent Disability, or
retirement shall share in the allocation of the Employer's Matching
Contribution made pursuant to Section 11.1(b), the Employer's
Non-Elective Contributions made pursuant to Section 11.1(c), the
Employer's Qualified Non-Elective Contribution made pursuant to Section
11.1(d), and Forfeitures as provided in this Section regardless of
whether they completed a Year of Service during the Plan Year.
(g) Notwithstanding any election in the Adoption Agreement to the
contrary, if this is a non-standardized Plan that would otherwise fail
to meet the requirements of Code Sections 401(a)(26),410(b)(1), or
410(b)(2)(A)(i) and the Regulations thereunder because Employer
matching Contributions made pursuant to Section 11.1(b), Employer
Non-Elective Contributions made pursuant to Section 11.1(c) or Employer
Qualified Non-Elective Contributions made pursuant to Section 11.1(d)
have not been allocated to a
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sufficient number or percentage of Participants for a Plan Year, then
the following rules shall apply:
(1) The group of Participants eligible to share in the
respective contributions for the Plan Year shall be expanded
to include the minimum number of Participants who would not
otherwise be eligible as are necessary to satisfy the
applicable test specified above. The specific participants who
shall become eligible under the terms of this paragraph shall
be those who are actively employed on the last day of the Plan
Year and, when compared to similarly situated Participants,
have completed the greatest number of Hours of Service in the
Plan Year.
(2) If after application of paragraph (1) above, the
applicable test is still not satisfied, then the group of
Participants eligible to share for the Plan Year shall be
further expanded to include the minimum number of Participants
who are not actively employed on the last day of the Plan Year
as are necessary to satisfy the applicable test. The specific
Participants who shall become eligible to share shall be those
Participants, when compared to similarly situated
Participants. who have completed the greatest number of Hours
of Service in the Plan Year before terminating employment.
11.4 ACTUAL DEFERRAL PERCENTAGE TESTS
(a) Maximum Annual Allocation: For each Plan Year beginning after
December 31, 1986, the annual allocation derived from Employer Elective
Contributions and Qualified Non-Elective Contributions to a
Participant's Elective Account and Qualified Non-Elective Account shall
satisfy one of the following tests:
(1) The "Actual Deferral Percentage" for the Highly
Compensated Participant group shall not be more than the
"Actual Deferral Percentage" of the Non-Highly Compensated
Participant group multiplied by 1.25, or
(2) The excess of the "Actual Deferral Percentage" for the
Highly Compensated Participant group over the "Actual Deferral
Percentage" for the Non-Highly Compensated Participant group
shall not be more than two percentage points. Additionally,
the "Actual Deferral Percentage" for the Highly Compensated
Participant group shall not exceed the "Actual Deferral
Percentage" for the Non-Highly Compensated Participant group
multiplied by 2. The provisions of Code Section 401(k)(3) and
Regulation 1.401(k)-1(b) are incorporated herein by reference.
However, for Plan Years beginning after December 31,
1988, to prevent the multiple use of the alternative method
described in (2) above and Code Section 401(m)(9)(A), any
Highly Compensated Participant eligible to make elective
deferrals pursuant to Section 11.2 and to make Employee
contributions or
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to receive matching contributions under this Plan or under any
other plan maintained by the Employer or an Affiliated
Employer shall have his actual contribution ratio reduced
pursuant to Regulation 1.401(m)-2, the provisions of which are
incorporated herein by reference.
(b) For the purposes of this Section "Actual Deferral Percentage"
means, with respect to the Highly Compensated Participant group and
Non-Highly Compensated Participant group for a Plan Year, the average
of the ratios, calculated separately for each Participant in such
group, of the amount of Employer Elective Contributions and Qualified
Non-Elective Contributions allocated to each Participant's Elective
Account and Qualified Non-Elective Account for such Plan Year, to such
Participant's "414(s) Compensation" for such Plan Year. The actual
deferral ratio for each Participant and the "Actual Deferral
Percentage" for each group, for Plan Years beginning after December 31,
1988, shall be calculated to the nearest one-hundredth of one percent
of the Participant's "414(s) Compensation." Employer Elective
Contributions allocated to each Non-Highly Compensated Participant's
Elective Account shall be reduced by Excess Deferred Compensation to
the extent such excess amounts are made under this Plan or any other
plan maintained by the Employer.
(c) For the purpose of determining the actual deferral ratio of a
Highly Compensated Participant who is subject to the Family Member
aggregation rules of Code Section 414(q)(6) because such Participant is
either a "five percent owner" of the Employer or one of the ten (10)
Highly Compensated Employees paid the greatest "415 Compensation"
during the year, the following shall apply:
(1) The combined actual deferral ratio for the family group
(which shall be treated as one Highly Compensated Participant)
shall be the greater of: (i) the ratio determined by
aggregating Employer Elective Contributions and "414(s)
Compensation" of all eligible Family Members who are Highly
Compensated Participants without regard to family aggregation;
and (ii) the ratio determined by aggregating Employer Elective
Contributions and "414(s) Compensation" of all eligible Family
Members (including Highly Compensated Participants). However,
in applying the $200.000 limit to "414(s) Compensation" for
Plan Years beginning after December 31, 1988, Family Members
shall include only the affected Employee's spouse and any
lineal descendants who have not attained age 19 before the
close of the Plan Year.
(2) The Employer Elective Contributions and "414(s)
Compensation" of all Family Members shall be disregarded for
purposes of determining the "Actual Deferral Percentage" of
the Non-Highly Compensated Participant group except to the
extent taken into account in paragraph (1) above.
(3) If a Participant is required to be aggregated as a member
of more than one family group in a plan, all Participants who
are members of those family groups that include the
Participant are aggregated as one family group in accordance
with
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paragraphs (1) and (2) above.
(d) For the purposes of this Section and Code Sections 401(a)(4);
410(b) and 401(k), if two or more plans which include cash or deferred
arrangements are considered one plan for the purposes of Code Section
401(a)(4) or 410(b) (other than Code Section 401(b)(2)(A)(ii) as in
effect for Plan Years beginning after December 31, 1988), the cash or
deferred arrangements included in such plans shall be treated as one
arrangement. In addition, two or more cash or deferred arrangements may
be considered as a single arrangement for purposes of determining
whether or not such arrangements satisfy Code Sections 401(a)(4),
410(b) and 401(k). In such a case. the cash or deferred arrangements
included in such plans and the plans including such arrangements shall
be treated as one arrangement and as one plan for purposes of this
Section and Code Sections 401(a)(4), 410(b) and 401(k). For plan years
beginning after December 31, 1989, plans may be aggregated under this
paragraph (e) only if they have the same plan year.
Notwithstanding the above, for Plan Years beginning after
December 31, 1988, an employee stock ownership plan described in Code
Section 4975(e)(7) may not be combined with this Plan for purposes of
determining whether the employee stock ownership plan or this Plan
satisfies this Section and Code Sections 401(a)(4), 410(b) and 401(k).
(e) For the purposes of this Section, if a Highly Compensated
Participant is a Participant under two (2) or more cash or deferred
arrangements (other than a cash or deferred arrangement which is part
of an employee stock ownership plan as defined in Code Section
4975(e)(7) for Plan Years beginning after December 31, 1988) of the
Employer or an Affiliated Employer, all such cash or deferred
arrangements shall be treated as one cash or deferred arrangement for
the purpose of determining the actual deferral ratio with respect to
such Highly Compensated Participant. However, for Plan Years beginning
after December 31, 1988, if the cash or deferred arrangements have
different Plan Years, this paragraph shall be applied by treating all
cash or deferred arrangements ending with or within the same calendar
year as a single arrangement.
11.5 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS
In the event that the initial allocations of the Employer's Elective
Contributions and Qualified Non-Elective Contributions do not satisfy one of the
tests set forth in Section 11.4, for Plan Years beginning after December 31,
1986, the Administrator shall adjust Excess Contributions pursuant to the
options set forth below:
(a) On or before the fifteenth day of the third month following the end
of each Plan Year, the Highly Compensated Participant having the
highest actual deferral ratio shall have his portion of Excess
Contributions distributed to him and/or at his election
re-characterized as a voluntary Employee contribution pursuant to
Section 4.7 until one of the tests set forth in Section 11.4 is
satisfied, or until his actual deferral ratio equals the actual
deferral ratio of the Highly Compensated Participant having the second
highest
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actual deferral ratio. This process shall continue until one of the
tests set forth in Section 11.4 is satisfied. For each Highly
Compensated Participant, the amount of Excess Contributions is equal to
the Elective Contributions and Qualified Non-Elective Contributions
made on behalf of such Highly Compensated Participant (determined prior
to the application of this paragraph) minus the amount determined by
Multiplying the Highly Compensated Participant's actual deferral ratio
(determined after application of this paragraph) by his "414(s)
Compensation." However, in determining the amount of Excess
Contributions to be distributed and/or re-characterized with respect to
an affected Highly Compensated Participant as determined herein, such
amount shall be reduced by any Excess Deferred Compensation previously
distributed to such affected Highly Compensated Participant for his
taxable year ending with or within such Plan Year. Any distribution
and/or re-characterization of Excess Contributions shall be made in
accordance with the following:
(1) With respect to the distribution of Excess Contributions
pursuant to (a) above, such distribution:
(i) may be postponed but not later than the close of
the Plan Year following the Plan Year to which they
are allocable:
(ii) shall be made first from unmatched-Deferred
Compensation and, thereafter, simultaneously from
Deferred Compensation which is matched and matching
contributions which relate to such Deferred
Compensation. However, any such matching
contributions which are not Vested shall be forfeited
in lieu of being distributed;
(iii) shall be made from Qualified Non-Elective
Contributions only to the extent that Excess
Contributions exceed the balance in the Participant's
Elective Account attributable to Deferred
Compensation and Employer matching contributions.
(iv) shall be adjusted for Income; and
(v) shall be designated by the Employer as a
distribution of Excess Contributions (and Income).
(2) With respect to the re-characterization of Excess
Contributions pursuant to (a) above, such re-characterized
amounts:
(i) shall be deemed to have occurred on the date on
which the last of those Highly Compensated
Participants with Excess Contributions to be
re-characterized is notified of the
re-characterization and the tax consequences of such
re-characterization,
(ii) for Plan Years ending on or before August 8,
1988, may be
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postponed but not later than October 24, 1988;
(iii) shall not exceed the amount of Deferred
Compensation on behalf of any Highly Compensated
Participant for any Plan Year;
(iv) shall be treated as voluntary Employee
contributions for purposes of Code Section 401(a)(4)
and Regulation 1.401(k)-1(b). However, for purposes
of Sections 2.2 and 4.3(f), re-characterized Excess
Contributions continue to be treated as Employer
contributions that are Deferred Compensation. For
Plan Years beginning after December 31, 1988, Excess
Contributions re-characterized as voluntary Employee
contributions shall continue to be non-forfeitable
and subject to the same distribution rules provided
for in Section 11.2(c);
(v) which relate to Plan Years ending on or before
October 24, 1988, may be treated as either Employer
contributions or voluntary Employee contributions and
therefore shall not be subject to the restrictions of
Section I 1.2(c);
(vi) are not permitted if the amount re-characterized
plus voluntary Employee contributions actually made
by such Highly Compensated Participant, exceed the
maximum amount of voluntary Employee contributions
(determined prior to application of Section 11.6)
that such Highly Compensated Participant is permitted
to make under the Plan in the absence of
re-characterization:
(vii) shall be adjusted for Income.
(3) Any distribution and/or re-characterization of less than
the entire amount of Excess Contributions shall be treated as
a pro rata distribution and/or re-characterization of Excess
Contributions and Income.
(4) The determination and correction of Excess Contributions
of a Highly Compensated Participant whose actual deferral
ratio is determined under the family aggregation rules shall
be accomplished as follows:
(i) If the actual deferral ratio for the Highly
Compensated Participant is determined in accordance
with Section 11.4(c)(1)(ii), then the actual deferral
ratio shall be reduced as required herein and the
Excess Contributions for the family unit shall be
allocated among the Family Members in proportion to
the Elective Contributions of each Family Member that
were combined to determine the group actual deferral
ratio.
(ii) If the actual deferral ratio for the Highly
Compensated Participant is determined under Section
11.4(c)(1)(i), then the actual deferral ratio
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shall first be reduced as required herein, but not
below the actual deferral ratio of the group of
Family Members who are not Highly Compensated
Participants without regard to family aggregation.
The Excess Contributions resulting from this initial
reduction shall be allocated (in proportion to
Elective Contributions) among the Highly Compensated
Participants whose Elective Contributions were
combined to determine the actual deferral ratio. If
further reduction is still required, then Excess
Contributions resulting from this further reduction
shall be determined by taking into account the
contributions of all Family Members and shall be
allocated among them in proportion to their
respective Elective Contributions.
(b) Within twelve (12) months after the end of the Plan Year, the
Employer shall make a special Qualified Non-Elective Contribution on
behalf of Non-Highly Compensated Participants in an amount sufficient
to satisfy one of the tests set forth in Section 11.4(a). Such
contribution shall be allocated to the Participant's Qualified
Non-Elective Account of each Non-Highly Compensated Participant in the
same proportion that each Non-Highly Compensated Participant's
Compensation for the year bears to the total Compensation of all
Non-Highly Compensated Participants.
(c) For purposes of this Section, "Income" means the income or loss
allocable to Excess Contributions which shall equal the sum of the
allocable gain or loss for the Plan Year and the allocable gain or loss
for the period between the end of the Plan Year and the date of
distribution ("gap period"). The income or loss allocable to Excess
Contributions for the Plan Year and the "gap period" is calculated
separately and is determined by multiplying the income or loss for the
Plan Year or the "gap period" by a fraction. The numerator of the
fraction is the Excess Contributions for the Plan Year. The denominator
of the fraction is the total of the Participant's Elective Account
attributable to Elective Contributions and the Participant's Qualified
Non-Elective Account as of the end of the Plan Year or the "gap
period." reduced by the gain allocable to such total amount for the
Plan Year or the "gap period" and increased by the loss allocable to
such total amount for the Plan Year or the "gap period."
In lieu of the "Fractional method" described above. a "safe
harbor method" may be used to calculate the allocable Income for the
"gap period." Under such "safe harbor Method," allocable Income for the
"gap period" shall be deemed to equal ten percent (10%) of the Income
allocable to Excess Contributions for the Plan Year of the Participant
multiplied by the number of calendar months in the "gap period." For
purposes of determining the number of calendar months in the "gap
period." a distribution occurring on or before the fifteenth day of the
month shall be treated as having been made on the last day of the
preceding month and a distribution occurring after such Fifteenth day
shall be treated as having been made on the first day of the next
subsequent month.
Notwithstanding the above, for Plan Years which began in 1987.
Income during
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the "gap period" shall not be taken into account.
Notwithstanding the above, for any distribution under this
Section which is made after August 15, 1991, such distribution shall
not include any Income for the "gap period." Further provided, for any
distribution under this Section which is made after August 15, 1991,
the amount of Income may be computed using a reasonable method that is
consistent with Section 4.3(c), provided such method is used
consistently for all Participants and for all such distributions for
the Plan Year.
(d) Any amounts not distributed or re-characterized within 2 1/2 months
after the end of the Plan Year shall be subject to the 10% Employer
excise tax imposed by Code Section 4979.
11.6 ACTUAL CONTRIBUTION PERCENTAGE TESTS
(a) The "Actual Contribution Percentage," for Plan Years beginning
after the later of the Effective Date of this Plan or December 31,
1986, for the Highly Compensated Participant group shall not exceed the
greater of:
(1) 125 percent of such percentage for the Non-Highly
Compensated Participant group; or
(2) the lesser of 200 percent of such percentage for the
Non-Highly Compensated Participant group, or such percentage
for the Non-Highly Compensated Participant group plus 2
percentage points. However, for Plan Years beginning after
December 31, 1988, to prevent the multiple use of the
alternative method described in this paragraph and Code
Section 401(m)(9)(A), any Highly Compensated Participant
eligible to make elective deferrals pursuant to Section 11.2
or any other cash or deferred arrangement maintained by the
Employer or an Affiliated Employer and to make Employee
contributions or to receive matching contributions under any
plan maintained by the Employer or an Affiliated Employer
shall have his actual contribution ratio reduced pursuant to
Regulation 1.401(m)-2. The provisions of Code Section 401(m)
and Regulations 1.401(m)-1(b) and 1.401(m)-2 are incorporated
herein by reference.
(b) For the purposes of this Section and Section 11.7, "Actual
Contribution Percentage" for a Plan Year means, with respect to the
Highly Compensated Participant group and Non-Highly Compensated
Participant group, the average of the ratios (calculated separately for
each Participant in each group) of:
(1) the sum of Employer matching contributions made pursuant
to Section 11.1(b) (to the extent such matching contributions
are not used to satisfy the tests set forth in Section 11.4),
voluntary Employee contributions made pursuant to Section 4.7
and Excess Contributions re-characterized as voluntary
Employee contributions pursuant to Section 11.5 on behalf of
each such Participant for such
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Plan Year; to
(2) the Participant's "414(s) Compensation" for such Plan
Year.
(c) For purposes of determining the "Actual Contribution Percentage"
and the amount of Excess Aggregate Contributions pursuant to Section
11.7(d), only Employer matching contributions (excluding matching
contributions forfeited or distributed pursuant to Section 11.2(f),
11.5(a), or 11.7(a)) contributed To the Plan prior to the end of the
succeeding Plan Year shall be considered. In addition, the
Administrator may elect to take into account, with respect to Employees
eligible to have Employer matching contributions made pursuant to
Section 11.1(b) or voluntary Employee contributions made pursuant to
Section 4.7 allocated to their accounts, elective deferrals (as defined
in Regulation 1.402(g)-1(b)) and qualified non-elective contributions
(as defined in Code Section 401(m)(4)(Q) contributed to any plan
maintained by the Employer. Such elective deferrals and qualified
non-elective contributions shall he treated as Employer matching
contributions subject to Regulation 1.401(m)-l(b)(2) which is
incorporated herein by reference. However, for Plan Years beginning
after December 31, 1988, the Plan Year must be the same as the plan
year of the plan to which the elective deferrals and the qualified
non-elective contributions are made.
(d) For the purpose of determining the actual contribution ratio of a
Highly Compensated Employee who is subject to the Family Member
aggregation rules of Code Section 414(q)(6) because such Employee is
either a "five percent owner" of the Employer or one of the ten (10)
Highly Compensated Employees paid the greatest "415 Compensation"
during the year, the following shall apply:
(1) The combined actual contribution ratio for the family
group (which shall be treated as one highly Compensated
Participant) shall be the greater of:
(i) the ratio determined by aggregating Employer
matching contributions made pursuant to Section
11.1(b) (to the extent such matching contributions
are not used to satisfy the tests set forth in
Section 11.4), voluntary Employee contributions made
pursuant to Section 4.7, Excess Contributions
re-characterized as voluntary Employee contributions
pursuant to Section 11.5 and "414(s) Compensation" of
all eligible Family Members who are Highly
Compensated Participants without regard to family
aggregation; and
(ii) the ratio determined by aggregating Employer
matching contributions made pursuant to Section
11.1(b) (to the extent such matching contributions
are not used to satisfy the tests set forth in
Section 11.4), voluntary Employee contributions made
pursuant to Section 4.7, Excess Contributions
re-characterized as voluntary Employee contributions
pursuant to Section 11.5 and "414(s) Compensation" of
all eligible Family Members (including Highly
Compensated Participants). However, in
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applying the $200,000 limit to "414(s) Compensation"
for Plan Years beginning after December 31, 1988,
Family Members shall include only the affected
Employee's spouse and any lineal descendants who have
not attained age 19 before the close of the Plan
Year.
(2) The Employer matching contributions made pursuant to
Section 11.1(b) (to the extent such matching contributions are
not used to satisfy the tests set forth in Section 11.4),
voluntary Employee contributions made pursuant to Section 4.7,
Excess Contributions re-characterized as voluntary Employee
contributions pursuant to Section 11.5 and "414(s)
Compensation" of all Family Members shall be disregarded for
purposes of determining the "Actual Contribution Percentage"
of the Non-Highly Compensated Participant group except to the
extent taken into account in paragraph (1) above.
(3) If a Participant is required to be aggregated as a member
of more than one family group in a plan, all Participants who
are members of those family groups that include the
Participant are aggregated as one family group in accordance
with paragraphs (I) and (2) above.
(e) For purposes of this Section and Code Sections 401(a)(4), 410(b)
and 401(m), if two or more plans of the Employer to which matching
contributions, Employee contributions, or both, are made are treated as
one plan for purposes of Code Sections 401(a)(4) or 410(b) (other than
the average benefits test under Code Section 410(b)(2)(A)(ii) as in
effect for Plan Years beginning after December 31, 1988), such plans
shall be treated as one plan. In addition, two or more plans of the
Employer to which matching contributions. Employee contributions, or
both, are made may be considered as a single plan for purposes of
determining whether or not such plans satisfy Code Sections 401(a)(4),
410(b) and 401(m). In such a case, the aggregated plans must satisfy
this Section and Code Sections 401(a)(4), 410(b) and 401(m) as though
such aggregated plans were a single plan. For plan years beginning
after December 31, 1989, plans may be aggregated under this paragraph
only if they have the same plan year.
Notwithstanding the above, for Plan Years. beginning after
December 31, 1988, an employee stock ownership plan described in Code
Section 4975(e)(7) may not be aggregated with this Plan for purposes of
determining whether the employee stock ownership plan or this Plan
satisfies this Section and Code Sections 401(a)(4), 410(b) and 401(m).
(f) If a Highly Compensated Participant is a Participant under two or
more plans (other than an employee stock ownership plan as defined in
Code Section 4975(e)(7) for Plan Years beginning after December 31,
1988) which are maintained by the Employer or an Affiliated Employer to
which matching contributions, Employee contributions, or both, are
made, all such contributions on behalf of such Highly Compensated
Participant shall be aggregated for purposes of determining such Highly
Compensated Participant's actual contribution ratio. However, for Plan
Years beginning after December 31, 1988, if
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the plans have different plan years, this paragraph shall be applied by
treating all plans ending with or within the same calendar year as a
single plan.
(g) For purposes of Section 11.6(a) and 11.7, a Highly Compensated
Participant and a Non-Highly Compensated Participant shall include any
Employee eligible to have matching contributions made pursuant to
Section 11.1(b) (whether or not a deferred election was made or
suspended pursuant to Section 11.2(e)) allocated to his account for the
Plan Year or to make salary deferrals pursuant to Section 11.2 (if the
Employer uses salary deferrals to satisfy the provisions of this
Section) or voluntary Employee contributions pursuant to Section 4.7
(whether or not voluntary Employee contributions are made) allocated to
his account for the Plan Year.
(h) For purposes of this Section, "Matching Contribution" shall mean an
Employer contribution made to the Plan, or to a contract described in
Code Section 403(b), on behalf of a Participant on account of an
Employee contribution made by such Participant, or on account of a
participant's deferred compensation, under a plan maintained by the
Employer.
11.7 ADJUSTMENT TO ACTUAL CONTRIBUTION PERCENTAGE TESTS
(a) In the event that for Plan Years beginning after December 31, 1986,
the "Actual Contribution Percentage" for the Highly Compensated
Participant group exceeds the "Actual Contribution Percentage" for the
Non-Highly Compensated Participant group pursuant to Section 11.6(a),
the Administrator (on or before the fifteenth day of the third month
following the end of the Plan Year. but in no event later than the
close of the following Plan Year) shall direct the Trustee to
distribute to the Highly Compensated Participant having the highest
actual contribution ratio, his portion of Excess Aggregate
Contributions (and Income allocable to such contributions) or, if
forfeitable. forfeit such non-Vested, Excess Aggregate Contributions
attributable to Employer matching contributions (and Income allocable
to such Forfeitures) until either one of the tests set forth in Section
I 1.6(a) is satisfied, or until his actual contribution ratio equals
the actual contribution ratio of the Highly Compensated Participant
having the second highest actual contribution ratio. This process shall
continue until one of the tests Set forth in Section 11.6(a) is
satisfied. The distribution and/or Forfeiture of Excess Aggregate
Contributions shall be made in the following order:
(1) Employer matching contributions distributed and/or
forfeited pursuant to Section 11.5(a)(1);
(2) Voluntary Employee contributions including Excess
Contributions re-characterized as voluntary Employee
contributions pursuant to Section 11.5(a)(2);
(3) Remaining Employer matching contributions.
(b) Any distribution or Forfeiture of less than the entire amount of
Excess Aggregate
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Contributions (and Income) shall be treated as a pro rata distribution
of Excess Aggregate Contributions and Income. Distribution of Excess
Aggregate Contributions shall be designated by the Employer as a
distribution of Excess Aggregate Contributions (and Income).
Forfeitures of Excess Aggregate Contributions shall be treated in
accordance with Section 4.3. However, no such Forfeiture may be
allocated to a Highly Compensated Participant whose contributions are
reduced pursuant to this Section.
(c) Excess Aggregate Contributions attributable to amounts other than
voluntary Employee contributions, including forfeited matching
contributions, shall be treated as Employer contributions for purposes
of Code Sections 404 and 415 even if distributed from the Plan.
(d) For the purposes of this Section and Section 11.6, "Excess
Aggregate Contributions" means, with respect to any Plan Year, the
excess of:
(1) the aggregate amount of Employer matching contributions
made pursuant to Section 11.1(b) (to the extent such
contributions are taken into account pursuant to Section
11.6(a)), voluntary Employee contributions made pursuant to
Section 4.7, Excess Contributions re-characterized as
voluntary Employee contributions pursuant to Section 11.5 and
any Qualified Non-Elective Contributions or elective deferrals
taken into account pursuant to Section I 1.6(c) actually made
on behalf of the Highly Compensated Participant group for such
Plan Year, over
(2) the maximum amount of such contributions permitted under
the limitations of Section 11.6(a).
(e) For each Highly Compensated Participant, the amount of Excess
Aggregate Contributions is equal to the total Employer matching
contributions made pursuant to Section 11.1(b) (to the extent taken
into account pursuant to Section 11.6(a)), voluntary Employee
contributions made pursuant to Section 4.7, Excess Contributions
re-characterized as voluntary Employee contributions pursuant to
Section 11.5 and any Qualified Non-Elective Contributions or elective
deferrals taken into account pursuant to Section 11.6(c) on behalf of
the Highly Compensated Participant (determined prior to the application
of this paragraph) minus the amount determined by multiplying the
Highly Compensated Participant's actual contribution ratio (determined
after application of this paragraph) by his "414(s) Compensation." the
actual contribution ratio must be rounded to the nearest one-hundredth
of one percent for Plan Years beginning after December 31, 1988. In no
case shall the amount of Excess Aggregate Contribution with respect to
any Highly Compensated Participant exceed the amount of Employer
matching contributions made pursuant to Section 11.1(b) (to the extent
taken into account pursuant to Section 11.6(a)), voluntary Employee
contributions made pursuant to Section 4.7, Excess Contributions
re-characterized as voluntary Employee contributions pursuant to
Section 11.5 and any Qualified Non-Elective Contributions or elective
deferrals taken into account pursuant to Section I 1.6(c) on behalf of
such Highly Compensated Participant
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for such Plan Year.
(f) The determination of the amount of Excess Aggregate Contributions
with respect to any Plan Year shall be made after first determining the
Excess Contributions, if any, to be treated as voluntary Employee
contributions due to re-characterization for the plan year of any other
qualified cash or deferred arrangement (as defined in Code Section
401(k)) maintained by the Employer that ends with or within the Plan
Year or which are treated as voluntary Employee contributions due to
re-characterization pursuant to Section 11.5.
(g) "The determination and correction of Excess Aggregate Contributions
of a Highly
Compensated Participant whose actual contribution ratio is determined
under the family aggregation rules shall be accomplished as follows:
(1) If the actual contribution ratio for the Highly
Compensated Participant is determined in accordance with
Section 11.6(d)(1), then the actual contribution ratio shall
be reduced and the Excess Aggregate Contributions for the
family unit shall be allocated among the Family Members in
proportion to the sum of Employer matching contributions made
pursuant to Section 11.1(b) (to the extent taken into account
pursuant to Section 11.6(a)), voluntary Employee contributions
made pursuant to Section 4.7, Excess Contributions
re-characterized as voluntary Employee contributions pursuant
to Section 11.5 and any Qualified Non-Elective Contributions
or elective deferrals taken into account pursuant to Section
11.6(c) of each Family Member that were combined to determine
the group actual contribution ratio.
(2) If the actual contribution ratio for the Highly
Compensated Participant is determined under Section
11.6(d)(2), then the actual contribution ratio shall first be
reduced, as required herein, but not below the actual
contribution ratio of the group of Family Members who are not
Highly Compensated Participants without regard to family
aggregation. The Excess Aggregate Contributions resulting from
this initial reduction shall be allocated among the Highly
Compensated Participants whose Employer matching contributions
made pursuant to Section 11.1(b) (to the extent taken into
account pursuant to Section I 1.6(a)), voluntary Employee
contributions made pursuant to Section 4.7, Excess
Contributions re-characterized as voluntary Employee
contributions pursuant to Section 11.5 and any Qualified
Non-Elective Contributions or elective deferrals taken into
account pursuant to Section 11.6(c) were combined to determine
the actual contribution ratio. If further reduction is still
required, then Excess Aggregate Contributions resulting from
this further reduction shall be determined by taking into
account the contributions of all Family Members and shall be
allocated among them in proportion to their respective
Employer matching contributions made pursuant to Section
11.1(b) (to the extent taken into account pursuant to Section
I 1.6(a)), voluntary Employee contributions made pursuant to
Section 4.7, Excess
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Contributions re-characterized as voluntary Employee
contributions pursuant to Section 11.5 and any Qualified
Non-Elective Contributions or elective deferrals taken into
account pursuant to Section 11.6(c).
(h) Notwithstanding the above, within twelve (12) months after the end
of the Plan Year, the Employer may make a special Qualified
Non-Elective Contribution on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy one of the tests set
forth in Section 11.6. Such contribution shall be allocated to the
Participant's Qualified Non-Elective Account of each Non-Highly
Compensated Participant in the same proportion that each Non-Highly
Compensated Participant's Compensation for the year bears to the total
Compensation of all Non-Highly Compensated Participants. A separate
accounting shall be maintained for the purpose of excluding such
contributions from the "Actual Deferral Percentage" tests pursuant to
Section 11.4.
(i) For purposes of this Section, "Income" means the income or loss
allocable to Excess Aggregate Contributions which shall equal the sum
of the allocable gain or loss for the Plan Year and the allocable gain
or loss for the period between the end of the Plan Year and the date of
distribution ("gap period"). The income or loss Allocable to Excess
Aggregate Contributions for the Plan Year and the "gap period" is
calculated separately and is determined by multiplying the income or
loss for the Plan Year or the "gap period" by a fraction, The numerator
of the fraction is the Excess Aggregate Contributions for the Plan
Year. The denominator of the fraction is the total Participant's
Account and Voluntary Contribution Account attributable to Employer
matching contributions subject to Section 11.6, voluntary Employee
contributions made pursuant to Section 4.7, and any qualified
Non-Elective Contributions and Elective deferrals taken into account
pursuant to Section 11.6(c) as of the end of the Plan Year or the "gap
period," reduced by the gain allocable to such total amount for the
Plan Year or the "gap period" and increased by the loss allocable to
such total amount for the Plan Year or the "gap period."
In lieu of the "fractional method" described above, a "safe
harbor method" may be used to calculate the allocable Income for the
"gap period." Under such "safe harbor method," allocable Income for the
"gap period" shall be deemed to equal ten percent (10%) of the Income
allocable to Excess Aggregate Contributions for the Plan Year of the
Participant multiplied by the number of calendar months in the "gap
period." For purposes of determining the number of calendar months in
the "gap period," a distribution occurring on or before the fifteenth
day of the month shall be treated as having been made on the last day
of the preceding month and a distribution occurring after such
fifteenth day shall be treated as having been made on the first day of
the next subsequent month.
The Income allocable to Excess Aggregate Contributions
resulting from re-characterization of Elective Contributions shall be
determined and distributed as if such re-characterized Elective
Contributions had been distributed as Excess Contributions.
Notwithstanding the above, for any distribution under
this-Section which is made
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after August 15, 1991, such distribution shall not include any Income
for the "gap period." Further provided, for any distribution under this
Section which is made after August 15, 1991, the amount of Income may
be computed using a reasonable method that is consistent with Section
4.3(c), provided such method is used consistently for all Participants
and for all such distributions for the Plan Year.
Notwithstanding the above, for Plan Years which began in 1987,
Income during the "gap period" shall not be taken into account.
Notwithstanding the above, for any distribution under this
Section which is made after August 15, 1991, such distribution shall
not include any Income for the "gap period". Further provided, for any
distribution under this Section which is made after August 15, 1991,
the amount of Income may be computed using a reasonable method that is
consistent with Section 4.3(c), provided such method is used
consistently for all Participants and for all such distributions for
the Plan Year.
11.8 ADVANCE DISTRIBUTION FOR HARDSHIP
(a) The Administrator, at the election of the Participant, shall direct
the Trustee to distribute to any Participant in any one Plan Year up to
the lesser of (1) 100% of his accounts as specified in the Adoption
Agreement valued as of the last Anniversary Date or other valuation
date or (2) the amount necessary to satisfy the immediate and heavy
financial need of the Participant. Any distribution made pursuant to
this Section shall be deemed to be made as of the first day of the Plan
Year or, if later, the valuation date immediately preceding the date of
distribution, and the account from which the distribution is made shall
be reduced accordingly. Withdrawal under this Section shall be
authorized only if the distribution is on account of one of the
following or any other items permitted by the Internal Revenue Service:
(1) Medical expenses described in Code Section 213(d) incurred
by the Participant, his spouse, or any of his dependents (as
defined in Code Section 152) or expenses necessary for these
persons to obtain medical care;
(2) The purchase (excluding mortgage payments) of a principal
residence for the Participant;
(3) Payment of tuition and related educational fees for the
next 12 months of post-secondary education for the
Participant, his spouse, children, or dependents; or
(4) The need to prevent the eviction of the Participant from
his principal residence or foreclosure on the mortgage of the
Participant's principal residence.
(b) No such distribution shall be made from the Participant's Account
until such Account has become fully Vested.
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(c) No distribution shall be made pursuant to this Section unless the
Administrator, based upon the Participant's representation and such
other facts as are known to the Administrator. determines that all of
the following conditions are satisfied:
(1) The distribution is not in excess of the amount of the
immediate and heavy financial need of the Participant
(including any amounts necessary to pay any federal, state, or
local taxes or penalties reasonably anticipated to result from
the distribution);
(2) The Participant has obtained all distributions, other than
hardship distributions, and all nontaxable loans currently
available under all plans maintained by the Employer;
(3) The Plan, and all other plans maintained by the Employer,
provide that the Participant's elective deferrals and
voluntary Employee contributions will be suspended for at
least twelve (12) months after receipt of the hardship
distribution; and
(4) The Plan, and all other plans maintained by the Employer,
provide that the Participant may not make elective deferrals
for the Participant's taxable year immediately following the
taxable year of the hardship distribution in excess of the
applicable limit under Code Section 402(g) for such next
taxable year less the amount of such Participant's elective
deferrals for the taxable year of the hardship distribution.
(d) Notwithstanding the above, distributions from the Participant's
Elective Account and Qualified Non-Elective Account pursuant to this
Section shall be limited solely to the Participant's Deferred
Compensation and any income attributable thereto credited to the
Participant's Elective Account as of December 31, 1988.
(e) Any distribution made pursuant to this Section shall be made in a
manner which is consistent with and satisfies the provisions of Section
6.5, including, but not limited to, all notice and consent requirements
of Code Sections 411(a)(11) and 417 and the Regulations thereunder.
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AMENDMENT TO
THE ANGELL PENSION GROUP, INC. REGIONAL PROTOTYPE
DEFINED CONTRIBUTION PENSION PLAN AND TRUST
1. Article VI of the Plan is amended by the addition of the new subsection,
effective as of the following date:
a. For Plans not entitled to extended reliance as described in Revenue
Ruling 9476, the first day of the first Plan Year beginning on or after
December 31, 1994, or if later, 90 days after December 31, 1994; or
b. For Plans entitled to extended reliance as described in Revenue
Ruling 94-76, as of the first day of the first plan year beginning in
1999. However, in the event of a transfer of assets to the Plan from a
money purchase plan that occurs after the date of the most recent
determination letter, the effective date of the amendment shall, be the
date immediately preceding the date of such transfer of assets.
TRANSFER OF ASSETS FROM A MONEY PURCHASE PLAN
Notwithstanding any provision of this plan to the contrary, to the
extent that any optional form of benefit under this Plan permits a distribution
prior to the employee's retirement, death, disability, or severance from
employment, and prior to plan termination, the optional form of benefit is not
available with respect to benefits attributable to assets (including the
post-transfer earnings thereon) and liabilities that are transferred, within the
meaning of Section 414(l) of the Internal Revenue Code, to this plan from a
money purchase pension plan qualified under 401(a) of the Internal Revenue Code
(other than any portion of those assets and liabilities attributable to
voluntary employee contributions).
2. Article VI is amended by the addition of the following new subsection,
effective as of December 12, 1994:
UNIFORMED SERVICES
Notwithstanding any provision of this plan to the contrary,
contributions, benefits and service credit with respect to qualified military
service will be provided in accordance with Section 414(u) of the Internal
Revenue Code.
Loan repayments will be suspended under this plan as permitted under
Code Section 414(u)(4).
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Pursuant to the terms of the Plan regarding amendments, THE ANGELL PENSION
GROUP, INC, as the sponsor of the prototype, hereby adopts this amendment as
of the date set forth below.
The Angell Pension Group, Inc.
By: /s/ David G. Cram
-------------------
Title: President
Date: June 30, 1997
114
ADOPTION AGREEMENT FOR
THE ANGELL PENSION GROUP, INC. REGIONAL PROTOTYPE
NON-STANDARDIZED 401(K) PROFIT SHARING
PLAN AND TRUST
The undersigned Employer adopts The Angell Pension Group, Inc. Regional
Prototype Non-Standardized 401(k) Profit Sharing Plan and Trust for those
Employees who shall qualify as Participants hereunder, to be known as the
A1 EPRISE CORPORATION RETIREMENT SAVINGS PLAN
----------------------------------------------------------------------
(Enter Plan Name)
It shall be effective as of the date specified below. The Employer hereby
selects the following Plan specifications:
CAUTION: The failure to properly fill out this Adoption Agreement may result in
disqualification of the Plan.
EMPLOYER INFORMATION
B1 Name of Employer EPRISE CORPORATION
----------------------------------------------------------
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B2 Address 1671 WORCESTER ROAD
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FRAMINGHAM MA 01701
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City State Zip
Telephone: 508-872-0200
B3 Employer Identification Number: 04-3179480
B4 Date Business Commenced:
B5 TYPE OF ENTITY
a. [ ] S Corporation
b. [ ] Professional Service Corporation
c. [X] Corporation
d. [ ] Sole Proprietorship
e. [ ] Partnership
Copyright 1996-R The Angell Pension Group, Inc.
115
f. [ ] Other: __________________________
AND, is the Employer a member of ...
g. a controlled group? [ ] Yes [X] No
h. an affiliated service group? [ ] Yes [X] No
B6 NAMES(S) OF TRUSTEE(S)
a. MILTON ALPERN
b. JOSEPH FORGIONE
c.
B7 TRUSTEES' ADDRESS
a. [X] Use Employer Address
b. [ ]
-----------------------------------------------------------------------
Street
-----------------------------------------------------------------------
City State Zip
B8 LOCATION OF EMPLOYER'S PRINCIPAL OFFICE:
a. [ ] state b. [X] commonwealth of c. MASSACHUSETTS and
this Plan and Trust shall be governed under the same.
B9 EMPLOYER FISCAL YEAR means the 12 consecutive month period:
Commencing on a. JANUARY 1ST (e.g., January 1st)
---------------------
month day
and ending on b. DECEMBER 31ST
---------------------
month day
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116
PLAN INFORMATION
C1 EFFECTIVE DATE
This Adoption agreement of The Angell Pension Group, Inc. Regional
Prototype Non-Standardized 401(k) Profit Sharing Plan and Trust shall:
a. [ ] establish a new Plan and Trust effective as of ______________
(hereinafter called the "Effective Date").
b. [X] constitute an amendment and restatement in its entirety of a
previously established qualified Plan and Trust of the
Employer which was effective JANUARY 1, 1995 (hereinafter
called the "Effective Date"). Except as specifically provided
in the Plan, the effective date of this Amendment and
restatement is JANUARY 1, 1998. (For TRA '86 amendments,
enter the first day of the first Plan Year beginning in 1989.
C2 PLAN YEAR means the 12 consecutive month period::
Commencing on a. JANUARY 1ST (e.g., January 1st)
---------------------
month day
and ending on b. DECEMBER 31ST
---------------------
month day
IS THERE A SHORT PLAN YEAR?
c. [X] No
d. [ ] Yes, beginning _____________
and ending _________________
C3 ANNIVERSARY DATE of Plan (Annual Valuation Date)
a. DECEMBER 31ST
---------------------
month day
C4 PLAN NUMBER assigned by the Employer (select one)
a. [X] 001 b. [ ] 002 c. [ ] 003 d. [ ] Other ____________
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117
C5. NAME OF PLAN ADMINISTRATOR (Document provides for the Employer to appoint
an Administrator. If none is named, the Employer will become the
Administrator.)
a. [X] Employer (Use Employer Address)
b. [ ] Name __________________________________________________
Address [ ] Use Employer Address
__________________________________________________
__________________________________________________
City State Zip
Telephone: ____________________
Administrator's I.D. Number: _____-__________
C6 PLAN'S AGENT FOR SERVICE OF LEGAL PROCESS
a. [X] Employer (use Employer Address)
b. [ ] Name ________________________________________________
Address ________________________________________________
________________________________________________
City State Zip
ELIGIBILITY, VESTING AND RETIREMENT AGE
D1 ELIGIBLE EMPLOYEES (Plan Section 1.15) shall mean:
a. [ ] all Employees who have satisfied the eligibility requirements.
b. [X] all Employees who have satisfied the eligibility requirements
except those checked below:
1. [ ] Employees paid by commissions only.
2. [ ] Employees hourly paid.
3. [ ] Employees paid by salary.
4. [X] Employees whose employment is governed by a collective
bargaining agreement between the Employer and "employee
representatives" under which retirement benefits were
the subject of good faith bargaining. For this purpose,
the term "employee representatives" does not include any
organization more than half of whose members are
employees who are owners, officers, or executives of the
Employer.
5. [ ] Highly Compensated Employees.
6. [X] Employees who are non-resident aliens who received no
earned income
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118
(within the meaning of Code Section 911(d)(2)) from the
Employer which constitutes income from sources within
the United States (within the meaning of Code Section
861(a)(3)).
7. [ ] Other _______________
NOTE: For purposes of this section, the term Employee shall include all
Employees of this Employer and any leased employees deemed to be
Employees under code Section 414(n) or 414(o).
D2 EMPLOYEES OF AFFILIATED EMPLOYERS (Plan Section 1.16)
Employees of Affiliated Employers:
a. [X] will not or N/A
b. [ ] will
be treated as Employees of the Employer adopting the Plan.
NOTE: If D2b is elected, each Affiliated Employer should execute this
Adoption Agreement as a Participating Employer.
D3 HOURS OF SERVICE (Plan Section 1.31) will be determined on the basis of
the method selected below. Only one method may be selected. The method
selected will be applied to all Employees covered under the Plan.
a. [X] On the basis of actual hours for which an Employee is paid or
entitled to payment.
b. [ ] On the basis of days worked. An Employee will be credited with
ten (10) Hours of Service if under the Plan such Employee
would be credited with at least one (1) Hour of Service during
the day.
c. [ ] On the basis of weeks worked. An Employee will be credited
forty-five (45) Hours of Service if under the Plan such
Employee would be credited with at least one (1) Hour of
Service during the week.
d. [ ] On the basis of semi-monthly payroll periods. An Employee will
be credited with ninety-five (95) Hours of Service if under
the Plan such Employee would be credited with at least one (1)
Hour of Service during the semi-monthly payroll period.
e [ ] On the basis of months worked. An Employee will be credited
with one hundred ninety (190_ Hours of Service if under the
plan such Employee would be credited with at least one (1)
Hour of Service during the month.
D4 CONDITIONS OF ELIGIBILITY (Plan Section 3.1) (Check either a OR b and c, and
if applicable, d)
Any Eligible Employee will be eligible to participate in the Plan if
such Eligible Employee has satisfied the service and age requirements,
if any, specified below:
a. [ ] NO AGE OR SERVICE REQUIRED.
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119
b. [X] SERVICE REQUIREMENT. (may not exceed 1 year)
1. [ ] None
2. [ ] 1/2 Year of Service
3. [ ] 1 Year of Service
4. [X] Other 60 DAYS OF EMPLOYMENT
---------------------------
NOTE: If the Year(s) of Service selected is or includes a fractional
year, an Employee will not be required to complete any specified number
of Hours of Service to receive credit for such fractional year. If
expressed in Months of Service, an Employee will not be required to
complete any specified number of Hours of Service in a particular
month.
c. [ ] AGE REQUIREMENT (may not exceed 21)
1. [ ] N/A - No Age Requirement.
2. [ ] 20 1/2
3. [X] 21
4. [ ] Other ____________________
d. [ ] FOR NEW PLANS ONLY - Regardless of any of the above age or
service requirements, any Eligible Employee who was employed
on the Effective Date of the Plan shall be eligible to
participate hereunder and shall enter the Plan as of such
date.
D5 EFFECTIVE DATE OF PARTICIPATION (Plan Section 3.2) An Eligible
Employee shall become a Participant as of:
a. [ ] the first day of the Plan Year in which he met the
requirements.
b. [ ] the first day of the Plan Year in which he met the
requirements, if he met the requirements in the first 6 months
of the Plan Year, or as of the first day of the next
succeeding Plan Year if he met the requirements in the last 6
months of the Plan Year.
c. [ ] the earlier of the first day of the seventh month or the first
day of the Plan Year coinciding with or next following the
date on which he met the requirements.
d. [ ] the first day of the Plan Year next following the date on
which he met the requirements. (Eligibility must be 1/2 Year
of Service or less and age 20 1/2 or less.)
e. [ ] the first day of the month coinciding with or next following
the date on which he met the requirements.
f. [X] Other: FIRST DAY OF THE MONTH COINCIDENT WITH OR NEXT
FOLLOWING AGE AND SERVICE REQUIREMENT, provided that an
Employee who has satisfied the maximum age and service
requirements that are permissible in Section D4 above and who
is otherwise entitled to participate, shall commence
participation no later than the earlier of (a) 6 months after
such requirements are satisfied, or (b) the first day of the
first Plan Year after such requirements are satisfied, unless
the Employee separates from service before such participation
date.
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D6 VESTING OF PARTICIPANT'S INTEREST (Plan Section 6.4(b))
The vesting schedule, based on number of Years of Service, shall be as
follows:
a. [ ] 100% upon entering Plan. (Required if eligibility requirements
is greater than one (1) Year of Service.)
b. [ ] 0-2 years 0% c. [ ] 0-4 years 0%
3 years 100% 5 years 100%
d. [X] 0-1 year 0% e. [ ] 1 year 25%
2 years 20% 2 years 50%
3 years 40% 3 years 75%
4 years 60% 4 years 100%
5 years 80%
6 years 100%
f. [ ] 1 year 20% g. [ ] 0-2 years 0%
2 years 40% 3 years 20%
3 years 60% 4 years 40%
4 years 80% 5 years 60%
5 years 100% 6 years 80%
7 years 100%
h. [ ] Other - Must be at least as liberal as either c or g above.
YEARS OF SERVICE PERCENTAGE
-------------------------- --------------------------
-------------------------- --------------------------
-------------------------- --------------------------
D7 FOR AMENDED PLANS (Plan Section 6.4(f)) If the vesting schedule has
been amended to a less favorable schedule, enter the pre-amended
schedule below:
a. [X] Vesting schedule has not been amended or amended schedule is
more favorable in all years.
b. [ ] YEARS OF SERVICE PERCENTAGE
------------------- -------------------
------------------- -------------------
------------------- -------------------
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121
------------------- -------------------
D8 TOP HEAVY VESTING (Plan Section 6.4(c)) If this Plan becomes a Top
Heavy Plan, the following vesting schedule, based on number of Years of
Service, for such Plan Year and each succeeding Plan Year, whether or
not the Plan is a Top Heavy Plan, shall apply and shall be treated as a
Plan amendment pursuant to this Plan. Once effective, this schedule
shall also apply to any contributions made prior to the effective date
of Code Section 416 and/or before the Plan became a Top Heavy Plan.
a. [X] N/A (D5a, b d, e or f was selected)
b. [ ] 0-1 year 0% c. [ ] 0-2 years 0%
2 years 20% 3 years 100%
3 years 40%
4 years 60%
5 years 80%
6 years 100%
NOTE: This section does not apply to the Account balances of any
Participant who does not have an Hour of Service after the Plan has
initially become top heavy. Such Participant's Account balance
attributable to Employer contributions and Forfeitures will be
determined without regard to this section.
D9 VESTING (Plan Section 6.4(h)) In determining Years of Service for
vesting purposes, Years of Service attributable to the following shall
be excluded:
a. [ ] Service prior to the Effective Date of b. [X] N/A
the Plan or a predecessor plan.
c. [ ] Service prior to the time an Employee d. [X] N/A
attained age 18.
D10 PLAN SHALL RECOGNIZE SERVICE WITH PREDECESSOR EMPLOYER
a. [ ] No.
b. [X] Yes: Years of Service with NOVALINK, USA CORPORATION shall be
recognized for the purpose of this Plan.
NOTE: If the predecessor Employer maintained this qualified Plan, then
Years of Service with such predecessor Employer shall be recognized
pursuant to Section 1.74 and b. must be marked.
D11 NORMAL RETIREMENT AGE ("NRA") (Plan Section 1.42) means:
a. [X] the date a Participant attains his 65TH birthday. (not to
exceed 65th)
b. [ ] the later of the date a Participant attains his _______
birthday (not to exceed 65th) or the c. _____ (not to exceed
5th) anniversary of the first day of the Plan Year in which
participation in the Plan commenced.
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122
D12 NORMAL RETIREMENT DATE (Plan Section 1.43) shall commence:
a [X] as of the participant's "NRA."
OR (must select b. or c. AND 1. or 2.)
b. [ ] as of the first day of the month...
c. [ ] as of the Anniversary Date.
1. [ ] coinciding with or next following the Participant's
"NRA."
2. [ ] nearest the Participant's "NRA."
D13 EARLY RETIREMENT DATE (Plan Section 1.12) means the:
a. [X] No Early Retirement provision provided.
b. [ ] date on which a Participant...
c. [ ] first day of the month coinciding with or next following the
date on which a Participant...
d. [ ] Anniversary Date coinciding with or next following the date on
which a Participant...
AND, if b, c or d was selected ...
1. [ ] attains his ____ birthday and has
2. [ ] completed at least ______ Years of Service.
CONTRIBUTIONS, ALLOCATIONS, AND DISTRIBUTIONS
E1 a. COMPENSATION (Plan Section 1.9) with respect to any
Participant means:
1. [X] Wages, tips and other Compensation on Form W-2.
2. [ ] Section 3401(a) wages (wages for withholding purposes).
3. [ ] 415 safe-harbor compensation.
AND COMPENSATION
1. [X] shall
2. [ ] shall not
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123
exclude (even if includible in gross income) reimbursements or
other expenses allowances, fringe benefits (cash or noncash),
moving expenses, deferred compensation, and welfare benefits.
b. COMPENSATION shall be
1. [X] actually paid (must be selected if Plan is integrated)
2. [ ] accrued
c. HOWEVER, for non-integrated plans, Compensation shall exclude
(select all that apply);
a. [X] N/A. No exclusions
2. [ ] overtime
3. [ ] bonuses
4. [ ] commissions
5. [ ] other _____________________
d. FOR PURPOSES OF THIS SECTION E1, Compensation shall be based on:
1. [X] the Plan Year.
2. [ ] the Fiscal Year coinciding with or ending within the
Plan Year.
3. [ ] the Calendar Year coinciding with or ending within
the Plan Year.
NOTE: The Limitation Year shall be the same as the year on which
Compensation is based.
e. HOWEVER, for an Employee's first year of Participation,
Compensation shall be recognized as of:
1. [ ] the first day of the Plan Year.
2. [X] the date the participant entered the Plan.
f. IN ADDITION, COMPENSATION and 414(s) Compensation
1. [X] shall 2. [ ] shall not include compensation which is
not currently includible in the Participant's gross income by
reason of the application of Code Sections 125, 402(a)(8),
402(h)(1)(B) or 403(b).
E2. SALARY REDUCTION ARRANGEMENT - ELECTIVE CONTRIBUTION (Plan Section
11.2) Each Employee may elect to have his Compensation reduced by:
a. [ ] _____ %
b. [ ] up to _____ &
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124
c. [X] from 1 % to 20 %
----- ------
d. [ ] up to the maximum percentage allowable not to exceed the
limits of Code Sections 401(k), 404 and 415.
AND ...
e. [ ] A Participant may elect to commence salary reductions as of
THE FIRST DAY OF ANY month (ENTER AT LEAST ONE DATE OR
PERIOD). A Participant may modify the amount of salary
reductions as of THE FIRST DAY OF ANY MONTH (ENTER AT LEAST
ONE DATE OR PERIOD).
AND ...
Shall cash bonuses paid within 2 1/2 months after the end of the Plan
Year be subject to the salary reduction election?
f. [ ] Yes
g. [X] No
E3 FORMULA FOR DETERMINING EMPLOYER'S MATCHING CONTRIBUTION (Plan Section
11.1(b))
a. [ ] N/A. There shall be no matching contributions.
b. [X] The Employer shall make matching contributions equal to 50%
(e.g. 50%) of the Participant's salary reductions.
c. [ ] The Employer may make matching contributions equal to a
discretionary percentage, to be determined by the Employer, of
the Participant's salary reductions.
d. [ ] The Employer shall make matching contributions equal to the
sum of ____ % of the portion of the Participant's salary
reduction which does not exceed ____% of the Participant's
Compensation plus ____ % of the portion of the Participant's
salary reduction which exceeds ____% of the Participant's
Compensation, but does not exceed ____% of the Participant's
Compensation.
e. [ ] The Employer shall make matching contributions equal to the
percentage determined under the following schedule:
PARTICIPANT'S TOTAL MATCHING
YEARS OF SERVICE PERCENTAGE
------------------- -----------------
------------------- -----------------
------------------- -----------------
FOR PLANS WITH MATCHING CONTRIBUTIONS
f. [X] Matching contributions g. [ ] shall h. [X] shall not be used
in satisfying the deferral percentage tests. (If used, full
vesting and restrictions on withdrawals will apply and the
match will be deemed to be an Elective Contribution.)
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125
i. [X] Shall a Year of Service be required in order to share in the
matching contributions?
With respect to Plan Years beginning after 1989 ...
1. [ ] Yes (Could cause Plan to violate minimum
participation and coverage requirements under Code
Sections 401(a)(26) and 410)
2. [X] No
With respect to Plan Years beginning before 1990 ...
1. [X] N/A New Plan or same as years beginning after 1989.
2. [ ] Yes
3. [ ] No
j. [X] In determining matching contributions, only salary reductions
up to 5 % of a participant's Compensation will be
matched. k. [ ] N/A
l. [ ] The matching contribution made on behalf of a Participant for
any Plan Year shall not exceed $_____________. m. [ ] N/A
n. [X] Matching contributions shall be made on behalf of
1. [X] all Participants.
2. [ ] only Non-Highly Compensated Employees.
o. [ ] Notwithstanding anything in the Plan to the contrary, all
matching contributions which relate to distributions of Excess
Deferred Compensation, Excess Contributions, and Excess
Aggregate Contributions shall be Forfeited. (Select this
option only if it is applicable.)
E4. WILL A DISCRETIONARY EMPLOYER CONTRIBUTION BE PROVIDED (OTHER THAN A
DISCRETIONARY MATCHING OR QUALIFIED NON-ELECTIVE CONTRIBUTION) (Plan
Section 11.1(c))?
a. [ ] No.
b. [ ] Yes, the Employer may make a discretionary contribution out of
its current or accumulated Net Profit.
c. [X] Yes, the Employer may make a discretionary contribution which
is not limited to its current or accumulated Net Profit.
IF YES (b. or c. is selected above), the Employer's discretionary
contribution shall be allocated as follows:
d. [X] FOR A NON-INTEGRATED PLAN
The Employer discretionary contribution for the Plan Year shall be
allocated in the same ratio as each Participant's Compensation bears to
the total of such Compensation of all Participants.
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126
e. [ ] FOR AN INTEGRATED PLAN
The Employer discretionary contribution for the Plan Year shall be
allocated in accordance with Plan Section 4.3(b)(2) based on a
Participant's Compensation in excess of:
f. [ ] The Taxable Wage Base.
g. [ ] The greater of $10,000 or 20% of the Taxable Wage Base.
h. [ ] _____ % of the Taxable Wage Base. (See Note below)
i. [ ] $__________ (see Note below)
NOTE: The integration percentage of 5.7% shall be reduced to:
1. 4.3% if h. or i. above is more than 20% and less than
or equal to 80% of the Taxable Wage Base.
2. 5.4% if h. or i. above is less than 100% and more
than 80% of the Taxable Wage Base.
E5 QUALIFIED NON-ELECTIVE CONTRIBUTIONS (Plan Section 11.1(d))
a. [ ] N/A. There shall be no Qualified Non-Elective Contributions
except as provided in Section 11.5(b) and 11.7(h).
b. [ ] The Employer shall make a Qualified Non-Elective Contribution
equal to ____ % of the total Compensation of all Participants
eligible to share in the allocations.
c. [X] The Employer may make a Qualified Non-Elective Contribution in
an amount to be determined by the Employer.
E6 FORFEITURES (Plan Section 4.3(e))
a. Forfeitures of contributions other than matching contributions
shall be ...
1. [X] added to the Employer's contribution under the Plan.
2. [ ] allocated to all participants eligible to share in
the allocations in the same proportion that each
Participant's Compensation for the year bears to the
Compensation of all Participants for such year.
b. Forfeitures of matching contributions shall be ...
1. [ ] N/A. No matching contributions or match is fully
vested.
2. [ ] used to reduce the Employer's matching contribution.
3. [X] allocated to all Participants eligible to share in
the allocations in proportion to each such
Participant's Compensation for the year.
4. [ ] allocated to all Non-Highly Compensated Employee's
eligible to share in the allocations in proportion to
each such Participant's Compensation for the year.
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127
E7 ALLOCATIONS TO ACTIVE PARTICIPANTS (Plan Section 4.3) With respect to
Plan Years beginning after 1989, a Participant ...
a. [ ] shall (Plan may become discriminatory)
b. [X] shall not
be required to complete a Year of Service in order to share in any
Non-Elective Contributions (other than matching contributions) or
Qualified Non-Elective Contributions. For Plan Years beginning before
1990, the Plan provides that a Participant must complete a Year of
Service to share in the allocations.
E8 ALLOCATIONS TO TERMINATED PARTICIPANTS (Plan Section 4.3(k)) Any
Participant who terminated employment during the Plan Year (i.e. not
actively employed on the last day of the Plan Year) for reasons other
than death, Total and Permanent Disability or retirement:
a. With respect to Employer Non-Elective Contributions (other
than matching), Qualified Non-Elective Contributions, and
Forfeitures:
1. For Plan Years beginning after 1989,
i. [ ] N/A, Plan does not provide for such
contributions.
ii. [X] shall share in the allocations provided such
Participant completed more than 500 Hours of
Service.
iii. [ ] shall share in such allocations provided
such Participant completed a Year of
Service.
iv. [X] shall not share in such allocations,
regardless of Hours of Service.
2. For Plan Years beginning before 1990,
i. [X] N/A, new Plan or same as for Plan Years
beginning after 1989.
ii. [ ] shall share in such allocations provided
such participant completed a Year of
Service.
iii. [ ] shall not share in such allocations,
regardless of Hours of Service.
NOTE: If a.1.iii or iv is selected, the Plan could violate minimum
participation and coverage requirements under Code Sections 401(a)(26)
and 410.
b. With respect to the allocation of Employer Matching
contributions, a Participant:
1. For Plan Years beginning after 1989,
i. [ ] N/A, Plan does not provide for matching
contributions.
ii. [X] shall share in the allocations, regardless
of Hours of Service.
iii. [ ] shall share in the allocations provided such
Participant completed more than 500 Hours of
Service.
iv. [ ] shall share in such allocations provided
such participant completed a Year of
Service.
v. [ ] shall not share in such allocations,
regardless of Hours of Service.
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128
2. For Plan Years beginning before 1990,
i. [X] N/A, new Plan, or same as years beginning
after 1989.
ii. [ ] shall share in the allocations, regardless
of Hours of Service.
iii. [ ] shall share in such allocations provided
such Participant completed a Year of
Service.
iv. [ ] shall not share in such allocations,
regardless of Hours of Service.
NOTE: If b.1.iv or v is selected, the Plan could violate minimum
participation and coverage requirements under Code Section 401(a)(26)
and 410.
E9 ALLOCATIONS OF EARNINGS (Plan Section 4.3(c))
Allocations of earnings with respect to amounts contributed to the Plan
after the previous Anniversary Date or other valuation date shall be
determined ...
a. [ ] by using a weighted average.
b. [ ] by treating one-half of all such contributions as being a part
of the Participant's nonsegregated account balance as of the
previous Anniversary Date or valuation date.
c. [ ] by using the method specified in Section 4.3(c).
d. [X] other INDIVIDUAL ACCOUNTS.
-----------------------
E10 LIMITATIONS ON ALLOCATIONS (Plan Section 4.4)
a. If any Participant is or was covered under another qualified
defined contribution plan maintained by the Employer, or if
the Employer maintains a welfare benefit fund, as defined in
Code Section 419(e), or an individual medical account, as
defined in Code Section 415(1)(2), under which amounts are
treated as Annual Additions with respect to any participant in
this Plan:
1. [X] N/A.
2. [ ] The provisions of Section 4.4(b) of the Plan will
apply.
3. [ ] Provide the method under which the Plan will limit
total Annual Additions to the Maximum Permissible
Amount, and will properly reduce any Excess Amounts,
in a manner that precludes Employer discretion.
-----------------------------------------------------
-----------------------------------------------------
-----------------------------------------------------
b. If any participant is or ever has been a Participant in a
defined benefit plan maintained by the Employer:
1. [X] N/A.
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129
2. [ ] In any Limitation Year, the Annual Additions credited
to the Participant under this Plan may not cause the
sum of the Defined Benefit Plan Fraction and Defined
Contribution Fraction to exceed 1.0. If the
Employer's contribution that would otherwise be made
on the Participant's behalf during the limitation
year would cause the 1.0 limitation to be exceeded,
the rate of contribution under this Plan will be
reduced so that the sum of the fraction equals 1.0.
If the 1.0 limitation is exceeded because of an
excess Amount, such Excess Amount will be reduced in
accordance with section 4.4(a)(4) of the Plan.
3. [ ] Provide the method under which the Plans involved
will satisfy the 1.0 limitation in a manner that
precludes Employer discretion.
-----------------------------------------------------
-----------------------------------------------------
-----------------------------------------------------
E11 DISTRIBUTIONS UPON DEATH (Plan Section 6.6(h)) Distributions upon the
death of Participant prior to receiving any benefits shall ...
a. [X] be made pursuant to the election of the Participant or
beneficiary.
b. [ ] begin within 1 year of death for a designated beneficiary and
be payable over the life (or over a period not exceeding the
life expectancy) of such beneficiary, except that if the
beneficiary is the Participant's spouse, begin within the time
the Participant would have attained age 70 1/2.
c. [ ] be made within 5 years of death for all beneficiaries.
d. [ ] other ______________________
E12 LIFE EXPECTANCIES (Plan Section 6.5(f)) for minimum distributions
required pursuant to Code Section 401(a)(9) shall ...
a. [X] be recalculated at the Participant's election.
b. [ ] be recalculated.
c. [ ] not be recalculated.
E13 CONDITIONS FOR DISTRIBUTIONS UPON TERMINATION Distributions upon
termination of employment pursuant to Section 6.4(a) of the Plan shall
not be made unless the following conditions have been satisfied:
a. [ ] N/A. Immediate distributions may be made at Participant's
election.
b. [ ] The Participant has incurred _____ 1-Year Break(s) in Service.
c. [ ] The Participant has reached his or her Early or Normal
Retirement Age.
d. [ ] Distributions may be made at the Participant's election on or
after the Anniversary Date following termination of
employment.
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130
e. [X] Other 45 DAYS FOLLOWING TERMINATION OF EMPLOYMENT
-------------------------------------------------
E14 FORM OF DISTRIBUTIONS (Plan Sections 6.5 and 6.6) Distributions under
the Plan may be made...
a. 1. [ ] in lump sums.
2. [X] in lump sums or installments.
b. AND, pursuant to Plan Sections 6.13,
1. [X] no annuities are allowed (avoids Joint and Survivor
rules).
2. [ ] annuities are allowed (Plan Section 6.13 shall not
apply).
NOTE: b.1. above may not be elected if this is an amendment to a plan
which permitted annuities as a form of distribution or if this Plan has
accepted a plan to plan transfer of assets from a plan which permitted
annuities as a form of distribution.
c. AND may be made in ...
1. [X] chase only (except for insurance or annuity
contracts).
2. [ ] cash or property.
TOP HEAVY REQUIREMENTS
F1 TOP HEAVY DUPLICATIONS (Plan Section 4.3(i)): When a Non-Key Employee
is a Participant in this Plan and a Defined Benefit Plan maintained by
the Employer, indicate which method shall be utilized to avoid
duplication of top heavy minimum benefits.
a. [X] The Employer does not maintain a Defined Benefit Plan.
b. [ ] A minimum, non-integrated contribution of 5% of each Non-Key
Employee's total Compensation shall be provided in this Plan,
as specified in Section 4.3(i). The defined Benefit and
Defined Contribution Fractions will be computed using 100% if
this choice is selected.)
c. [ ] A minimum, non-integrated contribution of 7 1/2% of each
Non-Key Employee's total Compensation shall be provided in
this Plan, as specified in Section 4.3(i). (If this choice is
selected, the Defined Benefit and Defined Contribution
Fractions will be computed using 125% for all Plan Years in
which the Plan is Top Heavy, but not Super Top Heavy.)
d. [ ] Specify the method under which the Plan will provide top heavy
minimum benefits for Non-Key Employees that will preclude
Employer discretion and avoid inadvertent omissions, including
any adjustments required under Code Section 415(e).
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F2 PRESENT VALUE OF ACCRUED BENEFIT (Plan Section 2.2) for Top Heavy
purposes where the Employer maintains a Defined Benefit Plan in
addition to this Plan, shall be based on ...
a. [X] N/A. The Employer does not maintain a defined benefit plan.
b. [ ] Interest Rate: ______________________________
Mortality Table: ____________________________
F3 TOP HEAVY DUPLICATIONS: Employer maintaining two (2) or more Defined
Contribution Plans:
a. [X] N/A/
b. [ ] A minimum, non-integrated contribution of 3% of each Non-Key
Employee's total Compensation shall be provided in the Money
Purchase Plan (or other plan subject to Code Section 412),
where the Employer maintains two (2) or more non-paired
Defined Contribution Plans.
c. [ ] Specify the method under which the Plans will provide top
heavy minimum benefits for Non-Key Employees that will
preclude Employer discretion and avoid inadvertent omissions,
including any adjustments required under Code Section 415(e).
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MISCELLANEOUS
G1 LOANS TO PARTICIPANTS (Plan Section 7.4)
a. [X] Yes, loans may be made up to $50,000 or 1/2 Vested interest.
b. [ ] No, loans may not be made.
If YES, (check all that apply) ...
c. [X] loans shall be treated as a Directed Investment.
d. [ ] loans shall only be made for hardship or financial necessity.
e. [X] the minimum loan shall be $1,000.
f. [ ] $10,000 de minimis loans may be made regardless of Vested
interest. (If selected, Plan may need security in addition to
Vested interest.)
NOTE: Department of Labor Regulations require the adoption of a
separate written loan program setting forth the requirements outlined
in Plan Section 7.4.
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G2 DIRECTED INVESTMENT ACCOUNTS (Plan Section 4.8) are permitted for the
interest in any one or more accounts.
a. [X] Yes, regardless of the Participant's Vested interest in the
Plan.
b. [ ] Yes, but only with respect to the Participant's Vested
interest in the Plan.
c. [ ] Yes, but only with respect to those accounts which are 100%
Vested.
d. [ ] No directed investments are permitted.
G3 TRANSFERS FROM QUALIFIED PLANS (Plan Section 4.6)
a. [X] Yes, transfers from qualified plans (and rollovers) will be
allowed.
b. [ ] No, transfers from qualified plans (and rollovers) will not be
allowed.
AND, transfers shall be permitted ...
c. [X] from any Employee, even if not a Participant.
d. [ ] from Participants only.
G4 EMPLOYEES' VOLUNTARY CONTRIBUTIONS (Plan Section 4.7)
a. [ ] Yes, Voluntary Contributions are allowed subject to the limits
of Section 4.10.
b. [X] No, Voluntary Contributions will not be allowed.
NOTE: TRA '86 subjects voluntary contributions to strict
discrimination rules.
G5 HARDSHIP DISTRIBUTIONS (Plan Section 6.11 and 11.8)
a. [ ] Yes, from any accounts which are 100% Vested.
b. [X] Yes, from Participant's Elective Account only.
c. [ ] Yes, but limited to the participant's Account only.
d. [ ] No.
NOTE: Distributions from a Participant's Elective Account are limited
to the portion of such account attributable to such Participant's
Deferred Compensation and earnings attributable thereto up to December
31, 1988. Also hardship distributions are not permitted from a
Participant's Qualified Non-Elective Account.
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G6 PRE-RETIREMENT DISTRIBUTION (Plan Section 6.10)
a. [X] If a Participant has reached the age of _______, distributions
may be made, at the Participant's election, from any accounts
which are 100% Vested without requiring the Participant to
terminate employment.
b. [ ] No pre-retirement distribution may be made.
NOTE: Distributions from a Participant's Elective Account and Qualified
Non-Elective Account are not permitted prior to age 59 1/2.
G7 LIFE INSURANCE (Plan Section 7.2(d)) may be purchased with Plan
contributions.
a. [X] No life insurance may be purchased.
b. [ ] Yes, at the option of the Administrator.
c. [ ] Yes, at the option of the Participant.
AND, the purchase of initial or additional life insurance shall be
subject to the following limitations: (select all that apply)
d. [ ] N/A, no limitations.
e. [ ] each initial Contract shall have a minimum face amount of
$____________.
f. [ ] each additional Contract shall have a minimum face amount of
$______________.
g. [ ] the Participant ahs completed _____ Years of Service.
h. [ ] the participant has completed _____ Years of Service while a
Participant in the Plan.
i. [ ] the Participant is under age _____ on the Contract issue date.
j. [ ] the maximum amount of all Contracts on behalf of a Participant
shall not exceed $______.
k. [ ] the maximum face amount of life insurance shall be $________.
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The adopting Employer may not rely on a notification letter issued by the Key
District Office of the Internal Revenue Service as evidence that the plan is
qualified under Code Section 401. In order to obtain reliance with respect to
plan qualification, the Employer must apply to the appropriate Key District
Office for a determination letter.
The Adoption Agreement may be used only in conjunction with basic Plan document
#01. This Adoption Agreement and the basic Plan document shall together be known
as The Angell Pension Group, Inc. Regional Prototype Non-Standardized 401(k)
Profit Sharing Plan and Trust #01-005.
The adoption of this Plan, its qualification by the IRS, and the related tax
consequences are the responsibility of the Employer and its independent tax and
legal advisors.
The Angell Pension Group, Inc. will notify the Employer of any amendments made
to the Plan or of the discontinuance or abandonment of the Plan provided this
Plan has been acknowledged by The Angell Pension Group, Inc. or its authorized
representative. Furthermore, in order to be eligible to receive such
notification, we agree to notify The Angell Pension Group, Inc. of any change in
address.
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135
IN WITNESS WHEREOF, the Employer and Trustee(s) hereby cause this Plan
to be executed on this 14th day of October, 1998. Furthermore, this Plan may not
be used unless acknowledged by The Angell Pension Group, Inc.
or its authorized representative.
EPRISE CORPORATION
By: /s/ Milton Alpern
Vice President of Finance
/s/ Milton Alpern
MILTON ALPERN, TRUSTEE
/s/ J.A. Forgione
JOSEPH FORGIONE, TRUSTEE
This Plan may not be used, and shall not be deemed to be a Prototype Plan,
unless an authorized representative of The Angell Pension Group, Inc. has
acknowledged the use of the Plan. Such acknowledgment is for administerial
purposes only. It acknowledges that the Employer is using the Plan but does not
represent that this Plan, including the choices selected on the Adoption
Agreement, has been reviewed by a representative of the sponsor or constitutes a
qualified retirement plan.
The Angell Pension Group, Inc.
By: /s/ Peter L. Karlsa
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136
AMENDMENT TO THE
EPRISE CORPORATION RETIREMENT SAVINGS PLAN
WHEREAS, Eprise Corporation (the "Employer") adopted the Eprise
Corporation Retirement Savings Plan (the "Plan") for the benefit of its
employees, originally effective January 1, 1995; and
WHEREAS, the Plan was thereafter amended form time to time; and
WHEREAS, the Employer wishes to further amend the Plan;
NOW, THEREFORE, pursuant to the power reserved to the Employer in
Article Eight of the Plan, the Plan is hereby amended as follows, effective
January 1, 1999:
FIRST: Item E3 of the Adoption Agreement is amended to read as follows:
E3 FORMULA FOR DETERMINING EMPLOYER'S MATCHING CONTRIBUTION (Plan Section
11.1(b))
a. [ ] N/A. There shall be no matching contributions.
b. [ ] The Employer shall make matching contributions equal to ____%
(e.g. 50%) of the Participant's salary reductions.
c. [X] The Employer may make matching contributions equal to a
discretionary percentage, to be determined by the Employer, of
the Participant's salary reductions.
d. [ ] The Employer shall make matching contributions equal to the
sum of ____ % of the portion of the Participant's salary
reduction which does not exceed ____% of the Participant's
Compensation plus ____ % of the portion of the Participant's
salary reduction which exceeds ____% of the Participant's
Compensation, but does not exceed ____% of the Participant's
Compensation.
e. [ ] The Employer shall make matching contributions equal to the
percentage determined under the following schedule:
PARTICIPANT'S TOTAL MATCHING
YEARS OF SERVICE PERCENTAGE
------------------- -----------------
------------------- -----------------
------------------- -----------------
137
SECOND: Item E7 of the Adoption Agreement is amended to read as
follows:
E7 ALLOCATIONS TO ACTIVE PARTICIPANTS (Plan Section 4.3) With respect to
Plan Years beginning after 1989, a Participant ...
a. [X] shall (Plan may become discriminatory)
b. [ ] shall not
be required to complete a Year of Service in order to share in any
Non-Elective Contributions (other than matching contributions) or
Qualified Non-Elective Contributions. For Plan Years beginning before
1990, the Plan provides that a Participant must complete a Year of
Service to share in the allocations.
E8 ALLOCATIONS TO TERMINATED PARTICIPANTS (Plan Section 4.3(k)) Any
Participant who terminated employment during the Plan Year (i.e. not
actively employed on the last day of the Plan Year) for reasons other
than death, Total and Permanent Disability or retirement:
a. With respect to Employer Non-Elective Contributions (other
than matching), Qualified Non-Elective Contributions, and
Forfeitures:
1. For Plan Years beginning after 1989,
i. [ ] N/A, Plan does not provide for such
contributions.
ii. [ ] shall share in the allocations provided such
Participant completed more than 500 Hours of
Service.
iii. [ ] shall share in such allocations provided
such Participant completed a Year of
Service.
iv. [X] shall not share in such allocations,
regardless of Hours of Service.
2. For Plan Years beginning before 1990,
i. [X] N/A, new Plan or same as for Plan Years
beginning after 1989.
ii. [ ] shall share in such allocations provided
such participant completed a Year of
Service.
iii. [ ] shall not share in such allocations,
regardless of Hours of Service.
NOTE: If a.1.iii or iv is selected, the Plan could violate minimum
participation and coverage requirements under Code Sections 401(a)(26)
and 410.
b. With respect to the allocation of Employer Matching
contributions, a Participant:
1. For Plan Years beginning after 1989,
i. [ ] N/A, Plan does not provide for matching
contributions.
ii. [ ] shall share in the allocations, regardless
of Hours of Service.
iii. [ ] shall share in the allocations provided such
Participant completed more than 500 Hours of
Service.
138
iv. [ ] shall share in such allocations provided
such participant completed a Year of
Service.
v. [X] shall not share in such allocations,
regardless of Hours of Service.
2. For Plan Years beginning before 1990,
i. [X] N/A, new Plan, or same as years beginning
after 1989.
ii. [ ] shall share in the allocations, regardless
of Hours of Service.
iii. [ ] shall share in such allocations provided
such Participant completed a Year of
Service.
iv. [ ] shall not share in such allocations,
regardless of Hours of Service.
NOTE: If b.1.iv or v is selected, the Plan could violate minimum
participation and coverage requirements under Code Section 401(a)(26)
and 410.
IN WITNESS WHEREOF, the Employer, but its duly authorized officer, has
caused this Amendment to be executed this 14th day of October, 1998.
EPRISE CORPORATION
By: /s/ Milton Alpern
Milton A. Alpern
Vice President of Finance
139
EPRISE CORPORATION RETIREMENT SAVINGS PLAN
SUMMARY OF MATERIAL MODIFICATIONS
The Eprise Corporation Retirement Savings Plan (referred to as the "Plan") has
recently been amended. Effective January 1, 1999, the formula for determining
the Company's match contribution has been revised. The amount of the Company's
match contributions will now be a discretionary percentage to be determined each
year, rather than 50% of your salary deferrals up to a maximum of 5% of your
compensation. In addition, you will now need to complete a Year of Service
(1,000 hours) and be employed on the last day of the Plan Year (December 31) to
share in any discretionary profit sharing contribution the Company may make.
You should keep this notice with your copy of the Summary Plan Description.
October 14, 1998 /s/ Milton Alpern
Date Plan Administrator
Plan Name: Eprise Corporation Retirement Savings Plan
Plan Number 001
Plan Sponsor: Eprise Corporation
1671 Worcester Road
Framingham, MA 01701
04-3179480
(508) 872-0200
Trustee: Milton Alpern, Joseph Forgione
Plan Administrator: Plan Sponsor
Effective Date
of Amendment: January 1, 1999