EXHIBIT 10.1 RETIREMENT AND PROFIT SHARING PLAN (AMENDED AND RESTATED AS OF
JANUARY 1, 2002), ADOPTED BY THE COMPANY ON SEPTEMBER 3, 2002.

 

MARKLEY ACTUARIAL SERVICES, INC.
DEFINED CONTRIBUTION PROTOTYPE PLAN AND TRUST

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DEFINED CONTRIBUTION PLAN

TABLE OF CONTENTS

ARTICLE I
DEFINITIONS

ARTICLE II
ADMINISTRATION

 

 

 

 

2.1

POWERS AND RESPONSIBILITIES OF THE EMPLOYER

 

12

2.2

DESIGNATION OF ADMINISTRATIVE AUTHORITY

 

13

2.3

ALLOCATION AND DELEGATION OF RESPONSIBILITIES

 

13

2.4

POWERS AND DUTIES OF THE ADMINISTRATOR

 

13

2.5

RECORDS AND REPORTS

 

14

2.6

APPOINTMENT OF ADVISERS

 

14

2.7

INFORMATION FROM EMPLOYER

 

14

2.8

PAYMENT OF EXPENSES

 

14

2.9

MAJORITY ACTIONS

 

14

2.10

CLAIMS PROCEDURE

 

15

2.11

CLAIMS REVIEW PROCEDURE

 

15

 

 

 

 

ARTICLE III
ELIGIBILITY

 

 

 

 

 

 

3.1

CONDITIONS OF ELIGIBILITY

 

15

3.2

EFFECTIVE DATE OF PARTICIPATION

 

15

3.3

DETERMINATION OF ELIGIBILITY

 

16

3.4

TERMINATION OF ELIGIBILITY

 

16

3.5

REHIRED EMPLOYEES AND BREAKS IN SERVICE

 

16

3.6

ELECTION NOT TO PARTICIPATE

 

17

3.7

CONTROL OF ENTITIES BY OWNER-EMPLOYEE

 

17

 

 

 

 

ARTICLE IV
CONTRIBUTION AND ALLOCATION

 

 

 

 

 

 

4.1

FORMULA FOR DETERMINING EMPLOYER’S CONTRIBUTION

 

17

4.2

TIME OF PAYMENT OF EMPLOYER’S CONTRIBUTION

 

17

4.3

ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS

 

17

4.4

MAXIMUM ANNUAL ADDITIONS

 

22

4.5

ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS

 

25

4.6

ROLLOVERS

 

26

4.7

PLAN TO PLAN TRANSFERS

 

 

 

 

 

 

 

FROM QUALIFIED PLANS

 

27

4.8

VOLUNTARY EMPLOYEE CONTRIBUTIONS

 

27

4.9

QUALIFIED VOLUNTARY EMPLOYEE CONTRIBUTIONS

 

28

4.10

DIRECTED INVESTMENT ACCOUNT

 

28

4.11

INTEGRATION IN MORE THAN ONE PLAN

 

30

4.12

QUALIFIED MILITARY SERVICE

 

30

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DEFINED CONTRIBUTION PLAN

 

 

 

 

ARTICLE V
VALUATIONS

 

 

 

 

5.1

VALUATION OF THE TRUST FUND

 

30

5.2

METHOD OF VALUATION

 

30

 

 

 

 

ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS

 

 

 

 

6.1

DETERMINATION OF BENEFITS UPON RETIREMENT

 

30

6.2

DETERMINATION OF BENEFITS UPON DEATH

 

30

6.3

DETERMINATION OF BENEFITS IN EVENT OF DISABILITY

 

31

6.4

DETERMINATION OF BENEFITS UPON TERMINATION

 

32

6.5

DISTRIBUTION OF BENEFITS

 

33

6.6

DISTRIBUTION OF BENEFITS UPON DEATH

 

37

6.7

TIME OF DISTRIBUTION

 

40

6.8

DISTRIBUTION FOR MINOR OR INCOMPETENT BENEFICIARY

 

40

6.9

LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN

 

40

6.10

IN-SERVICE DISTRIBUTION

 

40

6.11

ADVANCE DISTRIBUTION FOR HARDSHIP

 

41

6.12

SPECIAL RULE FOR CERTAIN PROFIT SHARING PLANS

 

41

6.13

QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION

 

42

6.14

DIRECT ROLLOVERS

 

42

6.15

TRANSFER OF ASSETS FROM A MONEY PURCHASE PLAN

 

42

6.16

ELECTIVE TRANSFERS OF BENEFITS TO OTHER PLANS

 

43

 

 

 

 

ARTICLE VII
TRUSTEE AND CUSTODIAN

 

 

 

 

7.1

BASIC RESPONSIBILITIES OF THE TRUSTEE

 

43

7.2

INVESTMENT POWERS AND DUTIES OF DISCRETIONARY TRUSTEE

 

44

7.3

INVESTMENT POWERS AND DUTIES OF NONDISCRETIONARY TRUSTEE

 

46

7.4

POWERS AND DUTIES OF CUSTODIAN

 

47

7.5

LIFE INSURANCE

 

48

7.6

LOANS TO PARTICIPANTS

 

48

7.7

MAJORITY ACTIONS

 

49

7.8

TRUSTEE’S COMPENSATION AND EXPENSES AND TAXES

 

49

7.9

ANNUAL REPORT OF THE TRUSTEE

 

50

7.10

AUDIT

 

50

7.11

RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE

 

50

7.12

TRANSFER OF INTEREST

 

51

7.13

TRUSTEE INDEMNIFICATION

 

51

7.14

EMPLOYER SECURITIES AND REAL PROPERTY

 

51

 

 

 

 

ARTICLE VIII
AMENDMENT, TERMINATION AND MERGERS

 

 

 

 

8.1

AMENDMENT

 

51

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DEFINED CONTRIBUTION PLAN

 

 

 

 

8.2

TERMINATION

 

52

8.3

MERGER, CONSOLIDATION OR TRANSFER OF ASSETS

 

52

 

 

 

 

 

 

 

 

ARTICLE IX
TOP HEAVY PROVISIONS

 

 

 

 

9.1

TOP HEAVY PLAN REQUIREMENTS

 

52

9.2

DETERMINATION OF TOP HEAVY STATUS

 

53

 

 

 

 

ARTICLE X
MISCELLANEOUS

 

 

 

 

10.1

EMPLOYER ADOPTIONS

 

54

10.2

PARTICIPANT’S RIGHTS

 

54

10.3

ALIENATION

 

54

10.4

CONSTRUCTION OF PLAN

 

55

10.5

GENDER AND NUMBER

 

55

10.6

LEGAL ACTION

 

55

10.7

PROHIBITION AGAINST DIVERSION OF FUNDS

 

55

10.8

EMPLOYER’S AND TRUSTEE’S PROTECTIVE CLAUSE

 

55

10.9

INSURER’S PROTECTIVE CLAUSE

 

55

10.10

RECEIPT AND RELEASE FOR PAYMENTS

 

56

10.11

ACTION BY THE EMPLOYER

 

56

10.12

NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY

 

56

10.13

HEADINGS

 

56

10.14

APPROVAL BY INTERNAL REVENUE SERVICE

 

56

10.15

UNIFORMITY

 

56

10.16

PAYMENT OF BENEFITS

 

56

 

 

 

 

ARTICLE XI
PARTICIPATING EMPLOYERS

 

 

 

 

11.1

ELECTION TO BECOME A PARTICIPATING EMPLOYER

 

57

11.2

REQUIREMENTS OF PARTICIPATING EMPLOYERS

 

57

11.3

DESIGNATION OF AGENT

 

57

11.4

EMPLOYEE TRANSFERS

 

57

11.5

PARTICIPATING EMPLOYER’S CONTRIBUTION AND FORFEITURES

 

57

11.6

AMENDMENT

 

57

11.7

DISCONTINUANCE OF PARTICIPATION

 

57

11.8

ADMINISTRATOR’S AUTHORITY

 

58

11.9

PARTICIPATING EMPLOYER CONTRIBUTION FOR AFFILIATE

 

58

 

 

 

 

ARTICLE XII
CASH OR DEFERRED PROVISIONS

 

 

 

 

12.1

FORMULA FOR DETERMINING EMPLOYER’S CONTRIBUTION

 

58

12.2

PARTICIPANT’S SALARY REDUCTION ELECTION

 

59

12.3

ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS

 

61

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DEFINED CONTRIBUTION PLAN

 

 

 

 

12.4

ACTUAL DEFERRAL PERCENTAGE TESTS

 

62

12.5

ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS

 

64

12.6

ACTUAL CONTRIBUTION PERCENTAGE TESTS

 

66

12.7

ADJUSTMENT TO ACTUAL CONTRIBUTION PERCENTAGE TESTS

 

68

12.8

SAFE HARBOR PROVISIONS

 

71

12.9

ADVANCE DISTRIBUTION FOR HARDSHIP

 

72

 

 

 

 

ARTICLE XIII
SIMPLE 401(K) PROVISIONS

 

 

 

 

13.1

SIMPLE 401(k) PROVISIONS

 

73

13.2

DEFINITIONS

 

74

13.3

CONTRIBUTIONS

 

74

13.4

ELECTION AND NOTICE REQUIREMENTS

 

74

13.5

VESTING REQUIREMENTS

 

75

13.6

TOP-HEAVY RULES

 

75

13.7

NONDISCRIMINATION TESTS

 

75

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DEFINED CONTRIBUTION PLAN

ARTICLE I
DEFINITIONS

          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 “ACP” means the “Actual Contribution Percentage” determined
pursuant to Section 12.6(e).

          1.2 “ACT” means the Employee Retirement Income Security Act of 1974,
as it may be amended from time to time.

          1.3 “ADP” means the “Actual Deferral Percentage” determined pursuant
to Section 12.4(e).

          1.4 “ADMINISTRATOR” means the Employer unless another person or entity
has been designated by the Employer pursuant to Section 2.2 to administer the
Plan on behalf of the Employer.

          1.5 “ADOPTION AGREEMENT” means the separate agreement which is
executed by the Employer and sets forth the elective provisions of this Plan and
Trust as specified by the Employer.

          1.6 “AFFILIATED EMPLOYER” means 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).

          1.7 “ANNIVERSARY DATE” means the last day of the Plan Year.

          1.8 “ANNUITY STARTING DATE” means, with respect to any Participant,
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.

          1.9 “BENEFICIARY” means the person (or entity) to whom all or a
portion of a deceased Participant’s interest in the Plan is payable, subject to
the restrictions of Sections 6.2 and 6.6.

          1.10 “CODE” means the Internal Revenue Code of 1986, as amended.

          1.11 “COMPENSATION” with respect to any Participant means one of the
following as elected in the Adoption Agreement:

 

 

 

          (a) Information required to be reported under Code Sections 6041, 6051
and 6052 (Wages, tips and other compensation as reported on Form W-2).
Compensation means wages, within the meaning of Code Section 3401(a), and all
other payments of compensation to an 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), 6051(a)(3) and
6052. 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 Code Section 3401(a)(2)).

 

 

 

          (b) Code Section 3401(a) Wages. Compensation means an Employee’s 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 means 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 salespersons, 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 nonaccountable plan (as described in Regulation 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 excludable from the Employee’s gross
income, or any distributions from a plan of deferred compensation;

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DEFINED CONTRIBUTION PLAN

 

 

 

(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 receive 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 Code Section 403(b) (whether or not
the contributions are actually excludable from the gross income of the
Employee).

 

 

                    However, Compensation for any Self-Employed Individual shall
be equal to Earned Income. Compensation shall include only that Compensation
which is actually paid to the Participant during the determination period.
Except as otherwise provided in this Plan, the determination period shall be the
period elected by the Employer in the Adoption Agreement. If the Employer makes
no election, the determination period shall be the Plan Year.

 

 

                    Notwithstanding the above, if elected in the Adoption
Agreement, Compensation shall include all of the following types of elective
contributions and all of the following types of deferred compensation:

 

 

 

          (a) Elective contributions that are made by the Employer on behalf of
a Participant that are not includible in gross income under Code Sections 125,
402(e)(3), 402(h)(1)(B), 403(b), and for Plan Years beginning on or after
January 1, 2001 (or as of a date, no earlier than January 1, 1998, as specified
in an addendum to the Adoption Agreement), 132(f)(4);

 

 

 

          (b) Compensation deferred under an eligible deferred compensation plan
within the meaning of Code Section 457(b); and

 

 

 

          (c) Employee contributions (under governmental plans) described in
Code Section 414(h)(2) that are picked up by the employing unit and thus are
treated as Employer contributions.

                    For Plan Years beginning on or after January 1, 1989, and
before January 1, 1994, the annual Compensation of each Participant taken into
account for determining all benefits provided under the Plan for any Plan Year
shall not exceed $200,000. This limitation shall be adjusted by the Secretary at
the same time and in the same manner as under Code Section 415(d), except that
the dollar increase in effect on January 1 of any calendar year is effective for
Plan Years beginning in such calendar year and the first adjustment to the
$200,000 limitation is effective on January 1, 1990.

                    For Plan Years beginning on or after January 1, 1994,
Compensation in excess of $150,000 (or such other amount provided in the Code)
shall be disregarded for all purposes other than for purposes of salary deferral
elections. Such amount shall be adjusted by the Commissioner for increases in
the cost-of-living in accordance with Code Section 401(a)(17)(B). The
cost-of-living adjustment in effect for a calendar year applies to any
determination period beginning in such calendar year. If a determination period
consists of fewer than twelve (12) months, the $150,000 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 twelve (12).

                    If Compensation for any prior determination period is taken
into account in determining a Participant’s allocations for the current Plan
Year, the Compensation for such prior determination period is subject to the
applicable annual Compensation limit in effect for that prior period. For this
purpose, in determining allocations in Plan Years beginning on or after January
1, 1989, the annual compensation limit in effect for determination periods
beginning before that date is $200,000. In addition, in determining allocations
in Plan Years beginning on or after January 1, 1994, the annual Compensation
limit in effect for determination periods beginning before that date is
$150,000.

                    Notwithstanding the foregoing, except as otherwise elected
in a non-standardized Adoption Agreement, the family member aggregation rules of
Code Sections 401(a)(17) and 414(q)(6) as in effect prior to the enactment of
the Small Business Job Protection Act of 1996 shall not apply to this Plan
effective with respect to Plan Years beginning after December 31, 1996.

                    If, in the Adoption Agreement, the Employer elects to
exclude a class of Employees from the Plan, then Compensation for any Employee
who becomes eligible or ceases to be eligible to participate during a
determination period shall only include Compensation while the Employee is an
Eligible Employee.

                    If, in connection with the adoption of any amendment, the
definition of Compensation has been modified, then, except as otherwise provided
herein, for Plan Years prior to the Plan Year which includes the adoption date
of such amendment, Compensation means compensation determined pursuant to the
terms of the Plan then in effect.

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DEFINED CONTRIBUTION PLAN

          1.12 “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 contract purchased hereunder, the Plan provisions shall control.

          1.13 “DESIGNATED INVESTMENT ALTERNATIVE” means a specific investment
identified by name by the Employer (or such other Fiduciary who has been given
the authority to select investment options) as an available investment under the
Plan to which Plan assets may be invested by the Trustee pursuant to the
investment direction of a Participant.

          1.14 “DIRECTED INVESTMENT OPTION” means a Designated Investment
Alternative and any other investment permitted by the Plan and the Participant
Direction Procedures to which Plan assets may be invested pursuant to the
investment direction of a Participant.

          1.15 “EARLY RETIREMENT DATE” means the date specified in the Adoption
Agreement on which a Participant or Former Participant has satisfied the
requirements specified in the Adoption Agreement (Early Retirement Age). If
elected in the Adoption Agreement, a Participant shall become fully Vested upon
satisfying such requirements if the Participant is still employed at the Early
Retirement Age.

                    A Former Participant who separates from service after
satisfying any service requirement but before satisfying the age requirement for
Early Retirement Age and who thereafter reaches the age requirement contained
herein shall be entitled to receive benefits under this Plan (other than any
accelerated vesting and allocations of Employer Contributions) as though the
requirements for Early Retirement Age had been satisfied.

          1.16 “EARNED INCOME” means 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 made by the Employer to a qualified plan to the extent deductible
under Code Section 404. In addition, net earnings shall be determined with
regard to the deduction allowed to the taxpayer by Code Section 164(f), for
taxable years beginning after December 31, 1989.

          1.17 “ELECTIVE DEFERRALS” means the Employer’s contributions to the
Plan that are made pursuant to a Participant’s deferral election pursuant to
Section 12.2, excluding any such amounts distributed as “excess annual
additions” pursuant to Section 4.5. Elective Deferrals shall be subject to the
requirements of Sections 12.2(b) and 12.2(c) and shall, except as otherwise
provided herein, be required to satisfy the nondiscrimination requirements of
Regulation 1.401(k)-1(b)(2), the provisions of which are specifically
incorporated herein by reference.

          1.18 “ELIGIBLE EMPLOYEE” means any Eligible Employee as elected in the
Adoption Agreement and as provided herein. With respect to a non-standardized
Adoption Agreement, an individual shall not be an “Eligible Employee” if such
individual is not reported on the payroll records of the Employer as a common
law employee. In particular, it is expressly intended that individuals not
treated as common law employees by the Employer on its payroll records are not
“Eligible Employees” and are excluded from Plan participation even if a court or
administrative agency determines that such individuals are common law employees
and not independent contractors. Furthermore, with respect to a non-standardized
Adoption Agreement, Employees of an Affiliated Employer will not be treated as
“Eligible Employees” prior to the date the Affiliated Employer adopts the Plan
as a Participating Employer.

                    Except as otherwise provided in this paragraph, if the
Employer does not elect in the Adoption Agreement to include Employees who
became Employees as the result of a “Code Section 410(b)(6)(C) transaction,”
then such Employees will only be “Eligible Employees” after the expiration of
the transition period beginning on the date of the transaction and ending on the
last day of the first Plan Year beginning after the date of the transaction. A
“Code Section 410(b)(6)(C) transaction” is an asset or stock acquisition,
merger, or similar transaction involving a change in the Employer of the
Employees of a trade or business that is subject to the special rules set forth
in Code Section 410(b)(6)(C). However, regardless of any election made in the
Adoption Agreement, if a separate entity becomes an Affiliate Employer as the
result of a “Code Section 410(b)(6)(C) transaction,” then Employees of such
separate entity will not be treated as “Eligible Employees” prior to the date
the entity adopts the Plan as a Participating Employer or, with respect to a
standardized Adoption Agreement, if earlier, the expiration of the transition
period set forth above.

                    If, in the Adoption Agreement, the Employer elects to
exclude union employees, then 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 and if two percent (2%) or less of the Employees covered pursuant to
that agreement are professionals as defined in Regulation 1.410(b)-9, shall not
be eligible to participate in this Plan. 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.

                    If, in the Adoption Agreement, the Employer elects to
exclude non-resident aliens, then Employees who are non-resident aliens (within
the meaning of Code Section 7701(b)(1)(B)) who received no earned income (within
the meaning of

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DEFINED CONTRIBUTION PLAN

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)) shall
not be eligible to participate in this Plan.

          1.19 “EMPLOYEE” means any person who is employed by the Employer. The
term “Employee” shall also include any person who is an employee of an
Affiliated Employer and any Leased Employee deemed to be an Employee as provided
in Code Section 414(n) or (o).

          1.20 “EMPLOYER” means the entity specified in the Adoption Agreement,
any successor which shall maintain this Plan and any predecessor which has
maintained this Plan. In addition, unless the context means otherwise, the term
“Employer” shall include any Participating Employer (as defined in Section 11.1)
which shall adopt this Plan.

          1.21 “EXCESS AGGREGATE CONTRIBUTIONS” means, with respect to any Plan
Year, the excess of:

 

 

 

          (a) The aggregate “Contribution Percentage Amounts” (as defined in
Section 12.6) actually made on behalf of Highly Compensated Participants for
such Plan Year and taken into account in computing the numerator of the ACP,
over

 

 

 

          (b) The maximum “Contribution Percentage Amounts” permitted by the ACP
test in Section 12.6 (determined by reducing contributions made on behalf of
Highly Compensated Participants in order of their “Contribution Percentages”
beginning with the highest of such percentages).

                    Such determination shall be made after first taking into
account corrections of any Excess Deferrals pursuant to Section 12.2 and then
taking into account adjustments of any Excess Contributions pursuant to Section
12.5.

          1.22 “EXCESS COMPENSATION” means, with respect to a Plan that is
integrated with Social Security (permitted disparity), a Participant’s
Compensation which is in excess of the integration level elected in the Adoption
Agreement.

                    However, if Compensation is based on less than a twelve (12)
month determination period, Excess Compensation shall be determined by reducing
the integration level by a fraction, the numerator of which is the number of
full months in the short period and the denominator of which is twelve (12).

          1.23 “EXCESS CONTRIBUTIONS” means, with respect to any Plan Year, the
excess of:

 

 

 

          (a) The aggregate amount of Employer contributions actually made on
behalf of Highly Compensated Participants for such Plan Year and taken into
account in computing the numerator of the ADP, over

 

 

 

          (b) The maximum amount of such contributions permitted by the ADP test
in Section 12.4 (determined by hypothetically reducing contributions made on
behalf of Highly Compensated Participants in order of the actual deferral
ratios, beginning with the highest of such ratios).

                    In determining the amount of Excess Contributions to be
distributed and/or recharacterized with respect to an affected Highly
Compensated Participant as determined herein, such amount shall be reduced by
any Excess Deferrals previously distributed to such affected Highly Compensated
Participant for the Participant’s taxable year ending with or within such Plan
Year.

          1.24 “EXCESS DEFERRALS” means, with respect to any taxable year of a
Participant, those elective deferrals (within the meaning of Code Section
402(g)) that are includible in the Participant’s gross income under Code Section
402(g) to the extent such Participant’s elective deferrals for the taxable year
exceed the dollar limitation under such Code Section. Excess Deferrals 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 in which the
Excess Deferral was made. Additionally, for purposes of Sections 4.3(f) and 9.2,
Excess Deferrals shall continue to be treated as Employer contributions even if
distributed pursuant to Section 12.2(e). However, Excess Deferrals of Non-Highly
Compensated Participants are not taken into account for purposes of Section
12.4.

          1.25 “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.

          1.26 “FISCAL YEAR” means the Employer’s accounting year.

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DEFINED CONTRIBUTION PLAN

          1.27 “FORFEITURE” means, with respect to a Former Participant who has
severed employment, that portion of the Participant’s Account that is not
Vested. Unless otherwise elected in the Adoption Agreement, Forfeitures occur
pursuant to (a) below.

                    (a) A Forfeiture will occur on the earlier of:

 

 

 

 

 

(1) The last day of the Plan Year in which a Former Participant who has severed
employment with the Employer incurs five (5) consecutive 1-Year Breaks in
Service, or

 

 

 

 

 

(2) The distribution of the entire Vested portion of the Participant’s Account
of a Former Participant who has severed employment with the Employer. For
purposes of this provision, if the Former Participant has a Vested benefit of
zero, then such Former Participant shall be deemed to have received a
distribution of such Vested benefit as of the year in which the severance of
employment occurs.

 

 

 

 

           (b) If elected in the Adoption Agreement, a Forfeiture will occur as
of the last day of the Plan Year in which the Former Participant incurs five (5)
1-Year Breaks in Service.

                    Regardless of the preceding provisions, if a Former
Participant is eligible to share in the allocation of Employer contributions or
Forfeitures in the year in which the Forfeiture would otherwise occur, then the
Forfeiture will not occur until the end of the first Plan Year for which the
Former Participant is not eligible to share in the allocation of Employer
contributions or Forfeitures. Furthermore, the term “Forfeiture” shall also
include amounts deemed to be Forfeitures pursuant to any other provision of this
Plan.

          1.28 “FORMER PARTICIPANT” means a person who has been a Participant,
but who has ceased to be a Participant for any reason.

          1.29 “414(s) COMPENSATION” means any definition of compensation that
satisfies the nondiscrimination requirements of Code Section 414(s) and the
Regulations thereunder. The period for determining 414(s) Compensation must be
either the Plan Year or the calendar year ending with or within the Plan Year.
An Employer may further limit the period taken into account to that part of the
Plan Year or calendar year in which an Employee was a Participant in the
component of the Plan being tested. The period used to determine 414(s)
Compensation must be applied uniformly to all Participants for the Plan Year.

          1.30 “415 COMPENSATION” means, with respect to any Participant, such
Participant’s (a) Wages, tips and other compensation on Form W-2, (b) Section
3401(a) wages or (c) 415 safe-harbor compensation as elected in the Adoption
Agreement for purposes of Compensation. 415 Compensation shall be based on the
full Limitation Year regardless of when participation in the Plan commences.
Furthermore, regardless of any election made in the Adoption Agreement, with
respect to Limitation Years beginning after December 31, 1997, 415 Compensation
shall include any elective deferral (as defined in Code Section 402(g)(3)) and
any amount which is contributed or deferred by the Employer at the election of
the Participant and which is not includible in the gross income of the
Participant by reason of Code Section 125, 457, and, for Limitation Years
beginning on or after January 1, 2001 (or as of a date, no earlier than January
1, 1998, as specified in an addendum to the Adoption Agreement), 132(f)(4). For
Limitation Years beginning prior to January 1, 1998, 415 Compensation shall
exclude such amounts.

                    Except as otherwise provided herein, 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 terms of the Plan then in effect.

          1.31 “HIGHLY COMPENSATED EMPLOYEE” means, effective for Plan Years
beginning after December 31, 1996, an Employee described in Code Section 414(q)
and the Regulations thereunder, and generally means any Employee who:

 

 

 

          (a) was a “five percent (5%) owner” as defined in Section 1.37(c) at
any time during the “determination year” or the “look-back year”; or

 

 

 

          (b) for the “look-back year” had 415 Compensation from the Employer in
excess of $80,000 and, if elected in the Adoption Agreement, was in the Top-Paid
Group for the “look-back year.” The $80,000 amount is adjusted at the same time
and in the same manner as under Code Section 415(d), except that the base period
is the calendar quarter ending September 30, 1996.

                    The “determination year” means the Plan Year for which
testing is being performed and the “look-back year” means the immediately
preceding twelve (12) month period. However, if the calendar year data election
is made in the Adoption Agreement, for purposes of (b) above, the “look-back
year” shall be the calendar year beginning within the twelve (12) month period
immediately preceding the “determination year.” Notwithstanding the preceding
sentence, if the calendar year data election is effective with respect to a Plan
Year beginning in 1997, then for such Plan Year 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” 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.

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DEFINED CONTRIBUTION PLAN

                    A highly compensated former employee is based on the rules
applicable to determining highly compensated employee status as in effect for
that “determination year,” in accordance with Regulation 1.414(q)-1T, A-4 and
IRS Notice 97-45 (or any superseding guidance).

                    In determining whether an employee is a Highly Compensated
Employee for a Plan Year beginning in 1997, the amendments to Code Section
414(q) stated above are treated as having been in effect for years beginning in
1996.

                    For purposes of this Section, for Plan Years beginning prior
to January 1, 1998, 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(e)(3),
402(h)(1)(B) and, for Plan Years beginning on or after January 1, 2001 (or as of
a date, no earlier than January 1, 1998, as specified in an addendum to the
Adoption Agreement), 132(f)(4), and, in the case of Employer contributions made
pursuant to a salary reduction agreement, Code Section 403(b).

                    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.

          1.32 “HIGHLY COMPENSATED PARTICIPANT” means any Highly Compensated
Employee who is eligible to participate in the component of the Plan being
tested.

          1.33 “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 (these
hours will be credited to the Employee for the computation period in which the
duties are performed); (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, incapacity
(including disability), jury duty, lay-off, military duty or leave of absence)
during the applicable computation period (these hours will be calculated and
credited pursuant to Department of Labor regulation 2530.200b-2 which is
incorporated herein by reference); (3) each hour for which back pay is awarded
or agreed to by the Employer without regard to mitigation of damages (these
hours will be credited to the Employee for the computation period or periods to
which the award or agreement pertains rather than the computation period in
which the award, agreement or payment is made). The same Hours of Service shall
not be credited both under (1) or (2), as the case may be, and under (3).

                     Notwithstanding (2) 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 workers’ 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. Furthermore, for
purposes of (2) above, 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.

                    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 Section 414(n) or 414(o) and the Regulations thereunder.
Furthermore, the provisions of Department of Labor regulations 2530.200b-2(b)
and (c) are incorporated herein by reference.

                    Hours of Service will be determined on the basis of the
method elected in the Adoption Agreement.

          1.34 “INSURER” means any legal reserve insurance company which has
issued or shall issue one or more Contracts or Policies under the Plan.

          1.35 “INVESTMENT MANAGER” means a Fiduciary as described in Act
Section 3(38).

          1.36 “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 fifty percent (50%), nor more than one-hundred percent
(100%) of the amount of the annuity payable during the joint lives of the
Participant and the Participant’s spouse which can be purchased with the
Participant’s Vested interest in the Plan reduced by any outstanding loan
balances pursuant to Section 7.6.

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DEFINED CONTRIBUTION PLAN

          1.37 “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 such Employee’s or former Employee’s Beneficiaries)
is considered a Key Employee if, the individual at any time during the Plan Year
that contains the “Determination Date” (as defined in Section 9.2(c)) 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 fifty percent (50%) 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 (1/2%) interest and the largest interests in the
Employer;

 

 

 

          (c) a “five percent (5%) owner” of the Employer. “Five percent (5%)
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 value 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; and

 

 

 

          (d) a “one percent (1%) owner” of the Employer having annual 415
Compensation from the Employer of more than $150,000. “One percent (1%) 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 value 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. 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. Furthermore, for purposes of this Section, for Plan Years
beginning prior to January 1, 1998, 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(e)(3), 402(h)(1)(B) and, for Plan Years beginning on or after January 1,
2001 (or as of a date, no earlier than January 1, 1998, as specified in an
addendum to the Adoption Agreement), 132(f)(4), and, in the case of Employer
contributions made pursuant to a salary reduction agreement, Code Section
403(b).

          1.38 “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 in the Adoption Agreement for the Normal Retirement
Date, a Participant’s actual retirement after having reached the Normal
Retirement Date.

          1.39 “LEASED EMPLOYEE” means, effective with respect to Plan Years
beginning on or after January 1, 1997, any person (other than an Employee of the
recipient Employer) who, pursuant to an agreement between the recipient Employer
and any other person or entity (“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 performed under primary
direction or control by 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. Furthermore, Compensation for a Leased Employee shall
only include Compensation from the leasing organization that is attributable to
services performed for the recipient Employer.

                    A Leased Employee shall not be considered an employee of the
recipient Employer if: (a) such employee is covered by a money purchase pension
plan providing: (1) a nonintegrated employer contribution rate of at least ten
percent (10%) of compensation, as defined in Code Section 415(c)(3), but for
Plan Years beginning prior to January 1, 1998, including amounts contributed
pursuant to a salary reduction agreement which are excludable from the
employee’s gross income under Code Sections 125, 402(e)(3), 402(h)(1)(B),
403(b), or for Plan Years beginning on or after January 1, 2001 (or as of a
date, no earlier than January 1, 1998, as specified in an addendum to the
Adoption Agreement), 132(f)(4), (2) immediate participation, and (3) full and
immediate vesting; and (b) leased employees do not constitute more than twenty
percent (20%) of the recipient Employer’s nonhighly compensated workforce.

          1.40 “LIMITATION YEAR” means the determination period used to
determine Compensation. However, the Employer may elect a different Limitation
Year in the Adoption Agreement or by adopting a written resolution to such
effect. All qualified plans maintained by the Employer must use the same
Limitation Year. Furthermore, unless there is a change to a new Limitation Year,
the Limitation Year will be a twelve (12) consecutive month period. In the case
of an initial Limitation Year, the Limitation Year will be the twelve (12)
consecutive month period ending on the last day of the period specified in the
Adoption

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DEFINED CONTRIBUTION PLAN

Agreement (or written resolution). If the Limitation Year is amended to a
different twelve (12) consecutive month period, the new “Limitation Year” must
begin on a date within the “Limitation Year” in which the amendment is made.

          1.41 “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 plan.

          1.42 “NON-ELECTIVE CONTRIBUTION” means the Employer’s contributions to
the Plan other than Elective Deferrals, any Qualified Non-Elective Contributions
and any Qualified Matching Contributions. Employer matching contributions which
are not Qualified Matching Contributions shall be considered a Non-Elective
Contribution for purposes of the Plan.

          1.43 “NON-HIGHLY COMPENSATED PARTICIPANT” means any Participant who is
not a Highly Compensated Employee. However, if pursuant to Sections 12.4 or 12.6
the prior year testing method is used to calculate the ADP or the ACP, a
Non-Highly Compensated Participant shall be determined using the definition of
Highly Compensated Employee in effect for the preceding Plan Year.

          1.44 “NON-KEY EMPLOYEE” means any Employee or former Employee (and
such Employee’s or former Employee’s Beneficiaries) who is not, and has never
been, a Key Employee.

          1.45 “NORMAL RETIREMENT AGE” means the age elected in the Adoption
Agreement at which time a Participant’s Account shall be nonforfeitable (if the
Participant is employed by the Employer on or after that date).

          1.46 “NORMAL RETIREMENT DATE” means the date elected in the Adoption
Agreement.

          1.47 “1-YEAR BREAK IN SERVICE” means, if the Hour of Service Method is
elected in the Adoption Agreement, the applicable computation period during
which an Employee or former Employee has not completed more than 500 Hours of
Service. Further, solely for the purpose of determining whether an Employee 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.”
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 the number of Hours
of Service needed to prevent the Employee from incurring a 1-Year Break in
Service.

                    “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 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.

                    If the Elapsed Time Method is elected in the Adoption
Agreement, a “1-Year Break in Service” means a twelve (12) consecutive month
period beginning on the severance from service date or any anniversary thereof
and ending on the next succeeding anniversary of such date; provided, however,
that the Employee or former Employee does not perform an Hour of Service for the
Employer during such twelve (12) consecutive month period.

          1.48 “OWNER-EMPLOYEE” means a sole proprietor who owns the entire
interest in the Employer or a partner (or member in the case of a limited
liability company treated as a partnership or sole proprietorship for federal
income tax purposes) who owns more than ten percent (10%) of either the capital
interest or the profits interest in the Employer and who receives income for
personal services from the Employer.

          1.49 “PARTICIPANT” means any Eligible Employee who has satisfied the
requirements of Section 3.2 and has not for any reason become ineligible to
participate further in the Plan.

          1.50 “PARTICIPANT DIRECTED ACCOUNT” means that portion of a
Participant’s interest in the Plan with respect to which the Participant has
directed the investment in accordance with the Participant Direction Procedures.

          1.51 “PARTICIPANT DIRECTION PROCEDURES” means such instructions,
guidelines or policies, the terms of which are incorporated herein, as shall be
established pursuant to Section 4.10 and observed by the Administrator and
applied and provided to Participants who have Participant Directed Accounts.

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DEFINED CONTRIBUTION PLAN

          1.52 “PARTICIPANT’S ACCOUNT” means the account established and
maintained by the Administrator for each Participant with respect to such
Participant’s 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. Separate accountings shall be maintained with respect to that
portion of a Participant’s Account attributable to Employer matching
contributions and to Employer discretionary contributions made pursuant to
Section 12.1(a)(3).

          1.53 “PARTICIPANT’S COMBINED ACCOUNT” means the total aggregate amount
of a Participant’s interest under the Plan resulting from Employer contributions
(including Elective Deferrals).

          1.54 “PARTICIPANT’S ELECTIVE DEFERRAL ACCOUNT” means the account
established and maintained by the Administrator for each Participant with
respect to such Participant’s total interest in the Plan resulting from Elective
Deferrals. Amounts in the Participant’s Elective Deferral Account are
nonforfeitable when made and are subject to the distribution restrictions of
Section 12.2(c).

          1.55 “PARTICIPANT’S ROLLOVER ACCOUNT” means the account established
and maintained by the Administrator for each Participant with respect to such
Participant’s interest in the Plan resulting from amounts transferred from
another qualified plan or “conduit” Individual Retirement Account in accordance
with Section 4.6.

          1.56 “PARTICIPANT’S TRANSFER ACCOUNT” means the account established
and maintained by the Administrator for each Participant with respect to the
total interest in the Plan resulting from amounts transferred to this Plan from
a direct plan-to-plan transfer in accordance with Section 4.7.

          1.57 “PERIOD OF SERVICE” means the aggregate of all periods commencing
with an Employee’s first day of employment or reemployment with the Employer or
an Affiliated Employer and ending on the first day of a Period of Severance. The
first day of employment or reemployment is the first day the Employee performs
an Hour of Service. An Employee will also receive partial credit for any Period
of Severance of less than twelve (12) consecutive months. Fractional periods of
a year will be expressed in terms of days.

                    Periods of Service with any Affiliated Employer shall be
recognized. Furthermore, Periods of Service with any predecessor employer that
maintained this Plan shall be recognized. Periods of Service with any other
predecessor employer shall be recognized as elected in the Adoption Agreement.

                    In determining Periods of Service for purposes of vesting
under the Plan, Periods of Service will be excluded as elected in the Adoption
Agreement and as specified in Section 3.5.

                    In the event the method of crediting service is amended from
the Hour of Service Method to the Elapsed Time Method, an Employee will receive
credit for a Period of Service consisting of:

 

 

 

          (a) A number of years equal to the number of Years of Service credited
to the Employee before the computation period during which the amendment occurs;
and

 

 

 

          (b) The greater of (1) the Periods of Service that would be credited
to the Employee under the Elapsed Time Method for service during the entire
computation period in which the transfer occurs or (2) the service taken into
account under the Hour of Service Method as of the date of the amendment.

                    In addition, the Employee will receive credit for service
subsequent to the amendment commencing on the day after the last day of the
computation period in which the transfer occurs.

          1.58 “PERIOD OF SEVERANCE” means a continuous period of time during
which an Employee is not employed by the Employer. Such period begins on the
date the Employee retires, quits or is discharged, or if earlier, the twelve
(12) month anniversary of the date on which the Employee was otherwise first
absent from service.

                    In the case of an individual who is absent from work for
“maternity or paternity” reasons, the twelve (12) consecutive month period
beginning on the first anniversary of the first day of such absence shall not
constitute a one year Period of Severance. For purposes of this paragraph, an
absence from work for “maternity or paternity” reasons means an absence (a) by
reason of the pregnancy of the individual, (b) by reason of the birth of a child
of the individual, (c) by reason of the placement of a child with the individual
in connection with the adoption of such child by such individual, or (d) for
purposes of caring for such child for a period beginning immediately following
such birth or placement.

          1.59 “PLAN” means this instrument (hereinafter referred to as Markley
Actuarial Services, Inc. Defined Contribution Prototype Plan and Trust Basic
Plan Document #01) and the Adoption Agreement as adopted by the Employer,
including all amendments thereto and any addendum which is specifically
permitted pursuant to the terms of the Plan.

          1.60 “PLAN YEAR” means the Plan’s accounting year as specified in the
Adoption Agreement. Unless there is a Short Plan Year, the Plan Year will be a
twelve-consecutive month period.

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DEFINED CONTRIBUTION PLAN

          1.61 “PRE-RETIREMENT SURVIVOR ANNUITY” means an immediate annuity for
the life of a Participant’s spouse, the payments under which must be equal to
the benefit which can be provided with the percentage, as specified in the
Adoption Agreement, of the Participant’s Vested interest in the Plan as of the
date of death. If no election is made in the Adoption Agreement, the percentage
shall be equal to fifty percent (50%). Furthermore, if less than one hundred
percent (100%) of the Participant’s Vested interest in the Plan is used to
provide the Pre-Retirement Survivor Annuity, a proportionate share of each of
the Participant’s accounts shall be used to provide the Pre-Retirement Survivor
Annuity.

          1.62 “QUALIFIED MATCHING CONTRIBUTION” means any Employer matching
contributions that are made pursuant to Sections 12.1(a)(2) if elected in the
Adoption Agreement, 12.5 and 12.7.

          1.63 “QUALIFIED MATCHING CONTRIBUTION ACCOUNT” means the account
established hereunder to which Qualified Matching Contributions are allocated.
Amounts in the Qualified Matching Contribution Account are nonforfeitable when
made and are subject to the distribution restrictions of Section 12.2(c).

          1.64 “QUALIFIED NON-ELECTIVE CONTRIBUTION” means the Employer’s
contributions to the Plan that are made pursuant to Sections 12.1(a)(4) if
elected in the Adoption Agreement, 12.5 and 12.7.

          1.65 “QUALIFIED NON-ELECTIVE CONTRIBUTION ACCOUNT” means the account
established hereunder to which Qualified Non-Elective Contributions are
allocated. Amounts in the Qualified Non-Elective Contribution Account are
nonforfeitable when made and are subject to the distribution restrictions of
Section 12.2(c).

          1.66 “QUALIFIED VOLUNTARY EMPLOYEE CONTRIBUTION ACCOUNT” means the
account established hereunder to which a Participant’s tax deductible qualified
voluntary employee contributions made pursuant to Section 4.9 are allocated.

          1.67 “REGULATION” means the Income Tax Regulations as promulgated by
the Secretary of the Treasury or a delegate of the Secretary of the Treasury,
and as amended from time to time.

          1.68 “RETIRED PARTICIPANT” means a person who has been a Participant,
but who has become entitled to retirement benefits under the Plan.

          1.69 “RETIREMENT DATE” means the date as of which a Participant
retires for reasons other than Total and Permanent Disability, regardless of
whether such retirement occurs on a Participant’s Normal Retirement Date, Early
Retirement Date or Late Retirement Date (see Section 6.1).

          1.70 “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.

          1.71 “SHAREHOLDER-EMPLOYEE” means a Participant who owns (or is deemed
to own pursuant to Code Section 318(a)(1)) 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 (S Corporation) under the
applicable Code sections relating to Small Business Corporations.

          1.72 “SHORT PLAN YEAR” means, if specified in the Adoption Agreement,
a Plan Year of less than a twelve (12) month period. If there is a Short Plan
Year, the following rules shall apply in the administration of this Plan. In
determining whether an Employee has completed a Year of Service (or Period of
Service if the Elapsed Time Method is used) for benefit accrual purposes in the
Short Plan Year, the number of the Hours of Service (or months of service if the
Elapsed Time Method is used) required shall be proportionately reduced based on
the number of days (or months) in the Short Plan Year. The determination of
whether an Employee has completed a Year of Service (or Period 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, then the integration level shall be proportionately reduced
based on the number of months in the Short Plan Year.

          1.73 “SUPER TOP HEAVY PLAN” means a plan which would be a Top Heavy
Plan if sixty percent (60%) is replaced with ninety percent (90%) in Section
9.2(a). However, effective as of the first Plan Year beginning after December
31, 1999, no Plan shall be considered a Super Top Heavy Plan.

          1.74 “TAXABLE WAGE BASE” means, with respect to any Plan Year, the
contribution and benefit base under Section 230 of the Social Security Act at
the beginning of such Plan Year.

          1.75 “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 retirement.

          1.76 “TOP HEAVY PLAN” means a plan described in Section 9.2(a).

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DEFINED CONTRIBUTION PLAN

          1.77 “TOP HEAVY PLAN YEAR” means a Plan Year commencing after December
31, 1983, during which the Plan is a Top Heavy Plan.

          1.78 “TOP-PAID GROUP” shall be determined pursuant to Code Section
414(q) and the Regulations thereunder and generally means the top twenty percent
(20%) of Employees who performed services for the Employer during the applicable
year, ranked according to the amount of 415 Compensation 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 if
required 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.
Furthermore, for the purpose of determining the number of active Employees in
any year, the following additional Employees may 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 twenty-one (21).

                    In addition, if ninety percent (90%) 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. Furthermore, in applying such
exclusions, the Employer may substitute any lesser service, hours or age.

          1.79 “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
twelve (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 Plan. The determination shall
be applied uniformly to all Participants.

          1.80 “TRUSTEE” means the person or entity named in the Adoption
Agreement, or any successors thereto.

                    If the sponsor of this prototype is a bank, savings and
loan, trust company, credit union or similar institution, a person or entity
other than the prototype sponsor (or its affiliates or subsidiaries) may not
serve as Trustee without the written consent of the sponsor.

          1.81 “TRUST FUND” means the assets of the Plan and Trust as the same
shall exist from time to time.

          1.82 “VALUATION DATE” means the date or dates specified in the
Adoption Agreement. Regardless of any election to the contrary, the Valuation
Date shall include the Anniversary Date and may include any other date or dates
deemed necessary or appropriate by the Administrator for the valuation of
Participants’ Accounts during the Plan Year, which may include any day that the
Trustee, any transfer agent appointed by the Trustee or the Employer, or any
stock exchange used by such agent, are open for business.

          1.83 “VESTED” means the nonforfeitable portion of any account
maintained on behalf of a Participant.

          1.84 “VOLUNTARY CONTRIBUTION ACCOUNT” means the account established
and maintained by the Administrator for each Participant with respect to such
Participant’s total interest in the Plan resulting from the Participant’s
after-tax voluntary Employee contributions made pursuant to Section 4.7.

                    Amounts recharacterized as after-tax voluntary Employee
contributions pursuant to Section 12.5 shall remain subject to the limitations
of Section 12.2. Therefore, a separate accounting shall be maintained with
respect to that portion of the Voluntary Contribution Account attributable to
after-tax voluntary Employee contributions made pursuant to Section 4.8.

          1.85 “YEAR OF SERVICE” means the computation period of twelve (12)
consecutive months, herein set forth, and during which an Employee has completed
at least 1,000 Hours of Service (unless a lower number of Hours of Service is
specified in the Adoption Agreement).

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DEFINED CONTRIBUTION PLAN

                    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 initial
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. Unless
otherwise elected in the Adoption Agreement, the succeeding computation periods
shall begin on the anniversary of the Employee’s employment commencement date.
However, unless otherwise elected in the Adoption Agreement, if one (1) Year of
Service or less is required as a condition of eligibility, then the computation
period after the initial 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, and subsequent computation periods shall be the Plan Year.
If there is a shift to the Plan Year, an Employee who is credited with the
number of Hours of Service to be credited with a Year 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 (2) Years of Service for purposes of
eligibility to participate.

                    If two (2) Years of Service are required as a condition of
eligibility, a Participant will only have completed two (2) Years of Service for
eligibility purposes upon completing two (2) consecutive Years of Service
without an intervening 1-Year Break-in-Service.

                    For vesting purposes, and all other purposes not
specifically addressed in this Section, the computation period shall be the
period elected in the Adoption Agreement. If no election is made in the Adoption
Agreement, the computation period shall be the Plan Year.

                    In determining Years of Service for purposes of vesting
under the Plan, Years of Service will be excluded as elected in the Adoption
Agreement and as specified in Section 3.5.

                    Years of Service and 1-Year Breaks in Service for
eligibility purposes will be measured on the same eligibility computation
period. Years of Service and 1-Year Breaks in Service for vesting purposes will
be measured on the same vesting computation period.

                    Years of Service with any Affiliated Employer shall be
recognized. Furthermore, Years of Service with any predecessor employer that
maintained this Plan shall be recognized. Years of Service with any other
predecessor employer shall be recognized as elected in the Adoption Agreement.

                    In the event the method of crediting service is amended from
the Elapsed Time Method to the Hour of Service Method, an Employee will receive
credit for Years of Service equal to:

 

 

 

          (a) The number of Years of Service equal to the number of 1-year
Periods of Service credited to the Employee as of the date of the amendment; and

 

 

 

          (b) In the computation period which includes the date of the
amendment, a number of Hours of Service (using the Hours of Service equivalency
method elected in the Adoption Agreement) to any fractional part of a year
credited to the Employee under this Section as of the date of the amendment.

ARTICLE II
ADMINISTRATION

2.1 POWERS AND RESPONSIBILITIES OF THE EMPLOYER

 

 

 

          (a) In addition to the general powers and responsibilities otherwise
provided for in this Plan, 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 ensure 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. The Employer may
appoint counsel, specialists, advisers, agents (including any nonfiduciary
agent) and other persons as the Employer deems necessary or desirable in
connection with the exercise of its fiduciary duties under this Plan. The
Employer may compensate such agents or advisers from the assets of the Plan as
fiduciary expenses (but not including any business (settlor) expenses of the
Employer), to the extent not paid by the Employer.

 

 

 

          (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 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. If the Trustee has discretionary authority, 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 the 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.

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DEFINED CONTRIBUTION PLAN

 

 

 

          (c) The Employer may appoint, at its option, an Investment Manager,
investment adviser, or other agent to provide direction to the Trustee with
respect to any or all of the Plan assets. Such appointment shall be given by the
Employer in writing in a form acceptable to the Trustee and shall specifically
identify the Plan assets with respect to which the Investment Manager or other
agent shall have the authority to direct the investment.

 

 

 

          (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.

2.2 DESIGNATION OF ADMINISTRATIVE AUTHORITY

                    The Employer may appoint one or more Administrators. If the
Employer does not appoint an Administrator, the Employer will be the
Administrator. 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 acceptance by filing written acceptance with the
Employer. An Administrator may resign by delivering a 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. Upon the resignation or removal of an
Administrator, the Employer may designate in writing a successor to this
position.

2.3 ALLOCATION AND DELEGATION OF RESPONSIBILITIES

                    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.

2.4 POWERS AND DUTIES OF THE ADMINISTRATOR

                    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. Benefits under this Plan will be paid only if the Administrator
decides in its discretion that the applicant is entitled to them. 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 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 its duties under this Plan.

                    The Administrator shall be charged with the duties of the
general administration of the Plan and the powers necessary to carry out such
duties as set forth under the terms of the Plan, including, but not limited to,
the following:

 

 

 

          (a) the discretion to determine all questions relating to the
eligibility of an Employee to participate or remain a Participant hereunder and
to receive benefits under the Plan;

 

 

 

          (b) the authority to review and settle all claims against the Plan,
including claims where the settlement amount cannot be calculated or is not
calculated in accordance with the Plan’s benefit formula. This authority
specifically permits the Administrator to settle, in compromise fashion,
disputed claims for benefits and any other disputed claims made against the
Plan;

 

 

 

          (c) 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;

 

 

 

          (d) to authorize and direct the Trustee with respect to all
discretionary or otherwise directed disbursements from the Trust Fund;

 

 

 

          (e) to maintain all necessary records for the administration of the
Plan;

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DEFINED CONTRIBUTION PLAN

 

 

 

          (f) to interpret the provisions of the Plan and to make and publish
such rules for regulation of the Plan that are consistent with the terms hereof;

 

 

 

          (g) 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;

 

 

 

          (h) 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
Plan;

 

 

 

          (i) 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 (if the Trustee has such discretion), in a manner
designed to accomplish specific objectives;

 

 

 

          (j) to prepare and implement a procedure for notifying Participants
and Beneficiaries of their rights to elect Joint and Survivor Annuities and
Pre-Retirement Survivor Annuities if required by the Plan, Code and Regulations
thereunder;

 

 

 

          (k) to assist Participants regarding their rights, benefits, or
elections available under the Plan;

 

 

 

          (l) to act as the named Fiduciary responsible for communicating with
Participants as needed to maintain Plan compliance with Act Section 404(c) (if
the Employer intends to comply with Act Section 404(c)) including, but not
limited to, the receipt and transmission of Participants’ directions as to the
investment of their accounts under the Plan and the formation of policies,
rules, and procedures pursuant to which Participants may give investment
instructions with respect to the investment of their accounts; and

 

 

 

          (m) to determine the validity of, and take appropriate action with
respect to, any qualified domestic relations order received by it.

2.5 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.

2.6 APPOINTMENT OF ADVISERS

                    The Administrator may appoint counsel, specialists,
advisers, agents (including nonfiduciary agents) and other persons as the
Administrator deems necessary or desirable in connection with the administration
of this Plan, including but not limited to agents and advisers to assist with
the administration and management of the Plan, and thereby to provide, among
such other duties as the Administrator may appoint, assistance with maintaining
Plan records and the providing of investment information to the Plan’s
investment fiduciaries and, if applicable, to Plan Participants.

2.7 INFORMATION FROM EMPLOYER

                    The Employer shall supply full and timely information to the
Administrator on all pertinent facts as the Administrator may require in order
to perform its functions hereunder 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.

2.8 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, or any person or persons
retained or appointed by any Named Fiduciary incident to the exercise of their
duties under the Plan, including, but not limited to, fees of accountants,
counsel, Investment Managers, agents (including nonfiduciary agents) appointed
for the purpose of assisting the Administrator or Trustee in carrying out the
instructions of Participants as to the directed investment of their accounts (if
permitted) and other specialists and their agents, the costs of any bonds
required pursuant to Act Section 412, and other costs of administering the Plan.
Until paid, the expenses shall constitute a liability of the Trust Fund.

2.9 MAJORITY ACTIONS

                    Except where there has been an allocation and delegation of
administrative authority pursuant to Section 2.3, if there is more than one
Administrator, then 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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DEFINED CONTRIBUTION PLAN

2.10 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 ninety (90) days after the application is
filed, or such period as is required by applicable law or Department of Labor
regulation. 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.

2.11 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
2.10 shall be entitled to request the Administrator to give further
consideration to the 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 such claim should be allowed, shall be filed with the
Administrator no later than sixty (60) days after receipt of the written
notification provided for in Section 2.10. The Administrator shall then conduct
a hearing within the next sixty (60) days, at which the claimant may be
represented by an attorney or any other representative of such claimant’s
choosing and expense and at which the claimant shall have an opportunity to
submit written and oral evidence and arguments in support of the claim. At the
hearing (or prior thereto upon five (5) business days written notice to the
Administrator) the claimant or the claimant’s 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 sixty (60) days of
receipt of the appeal (unless there has been an extension of sixty (60) days due
to special circumstances, provided the delay and the special circumstances
occasioning it are communicated to the claimant within the sixty (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. Notwithstanding the preceding, to the extent any of the time periods
specified in this Section are amended by law or Department of Labor regulation,
then the time frames specified herein shall automatically be changed in
accordance with such law or regulation.

                    If the Administrator, pursuant to the claims review
procedure, makes a final written determination denying a Participant’s or
Beneficiary’s benefit claim, then in order to preserve the claim, the
Participant or Beneficiary must file an action with respect to the denied claim
not later than one hundred eighty (180) days following the date of the
Administrator’s final determination.

ARTICLE III
ELIGIBILITY

3.1 CONDITIONS OF ELIGIBILITY

                    Any Eligible Employee shall be eligible to participate
hereunder on the date such Employee has satisfied the conditions of eligibility
elected in the Adoption Agreement.

3.2 EFFECTIVE DATE OF PARTICIPATION

                    An Eligible Employee who has satisfied the conditions of
eligibility pursuant to Section 3.1 shall become a Participant effective as of
the date elected in the Adoption Agreement. If said Employee is not employed on
such date, but is reemployed before a 1-Year Break in Service has occurred, then
such Employee shall become a Participant on the date of reemployment or, if
later, the date that the Employee would have otherwise entered the Plan had the
Employee not terminated employment.

                    Unless specifically provided otherwise in the Adoption
Agreement, an Eligible Employee who satisfies the Plan’s eligibility requirement
conditions by reason of recognition of service with a predecessor employer will
become a Participant as of the day the Plan credits service with a predecessor
employer or, if later, the date the Employee would have otherwise entered the
Plan had the service with the predecessor employer been service with the
Employer.

                    If an Employee, who has satisfied the Plan’s eligibility
requirements and would otherwise have become a Participant, shall go from a
classification of a noneligible Employee to an Eligible Employee, such Employee
shall become a Participant on the date such Employee becomes an Eligible
Employee or, if later, the date that the Employee would have otherwise entered
the Plan had the Employee always been an Eligible Employee.

                    If 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 noneligible class of Employees, such
Employee shall become a Participant in the Plan on the date such Employee again
becomes an Eligible Employee, or, if later, the date that the

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DEFINED CONTRIBUTION PLAN

Employee would have otherwise entered the Plan had the Employee always been an
Eligible Employee. However, if such Employee incurs a 1-Year Break in Service,
eligibility will be determined under the Break in Service rules set forth in
Section 3.5.

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 pursuant to Section 2.11.

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 the Plan for each Year of Service (or Period of Service, if
the Elapsed Time Method is used) completed while an ineligible Employee, until
such time as the Participant’s Account is forfeited or distributed pursuant to
the terms of the Plan. Additionally, the Former Participant’s interest in the
Plan shall continue to share in the earnings of the Trust Fund in the same
manner as Participants.

3.5 REHIRED EMPLOYEES AND BREAKS IN SERVICE

 

 

 

          (a) If any Participant becomes a Former Participant due to severance
from employment with the Employer and is reemployed by the Employer before a
1-Year Break in Service occurs, the Former Participant shall become a
Participant as of the reemployment date.

 

 

 

          (b) If any Participant becomes a Former Participant due to severance
from employment with the Employer and is reemployed after a 1-Year Break in
Service has occurred, Years of Service (or Periods of Service if the Elapsed
Time Method is being used) shall include Years of Service (or Periods of Service
if the Elapsed Time Method is being used) prior to the 1-Year Break in Service
subject to the following rules:

 

 

 

(1) In the case of a Former Participant who under the Plan does not have a
nonforfeitable right to any interest in the Plan resulting from Employer
contributions, Years of Service (or Periods of Service) before a period of
1-Year Breaks in Service will not be taken into account if the number of
consecutive 1-Year Breaks in Service equals or exceeds the greater of (A) five
(5) or (B) the aggregate number of pre-break Years of Service (or Periods of
Service). Such aggregate number of Years of Service (or Periods of Service) will
not include any Years of Service (or Periods of Service) disregarded under the
preceding sentence by reason of prior 1-Year Breaks in Service;

 

 

 

(2) A Former Participant who has not had Years of Service (or Periods of
Service) before a 1-Year Break in Service disregarded pursuant to (1) above,
shall participate in the Plan as of the date of reemployment, or if later, as of
the date the Former Participant would otherwise enter the Plan pursuant to
Sections 3.1 and 3.2 taking into account all service not disregarded.

 

 

 

          (c) After a Former Participant who has severed employment with the
Employer incurs five (5) consecutive 1-Year Breaks in Service, the Vested
portion of such Former Participant’s Account attributable to pre-break service
shall not be increased as a result of post-break service. In such case, separate
accounts will be maintained as follows:

 

 

 

(1) one account for nonforfeitable benefits attributable to pre-break service;
and

 

 

 

(2) one account representing the Participant’s Employer-derived account balance
in the Plan attributable to post-break service.

 

 

 

          (d) If any Participant becomes a Former Participant due to severance
of employment with the Employer and is reemployed by the Employer before five
(5) consecutive 1-Year Breaks in Service, and such Former Participant had
received a distribution of the entire Vested interest prior to reemployment,
then the forfeited account shall be reinstated only if the Former Participant
repays the full amount which had been distributed. Such repayment must be made
before the earlier of five (5) years after the first date on which the
Participant is subsequently reemployed by the Employer or the close of the first
period of five (5) consecutive 1-Year Breaks in Service commencing after the
distribution. If a distribution occurs for any reason other than a severance of
employment, the time for repayment may not end earlier than five (5) years after
the date of distribution. In the event the Former Participant does repay the
full amount distributed, the undistributed forfeited portion of the
Participant’s Account must be restored in full, unadjusted by any gains or
losses occurring subsequent to the Valuation Date preceding the distribution.
The source for such reinstatement may be Forfeitures occurring during the Plan
Year. If such source is insufficient, then the Employer will contribute an
amount which is sufficient to restore the Participant’s Account, provided,
however, that if a discretionary contribution is made for such year, such
contribution will first be applied to restore any such accounts and the

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DEFINED CONTRIBUTION PLAN

 

 

 

remainder shall be allocated in accordance with the terms of the Plan. If a
non-Vested Former Participant was deemed to have received a distribution and
such Former Participant is reemployed 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.

3.6 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 irrevocable and communicated to the Employer, in writing,
within a reasonable period of time before the beginning of the first Plan Year.
For standardized Plans, a Participant or an Eligible Employee may not elect not
to participate.

3.7 CONTROL OF ENTITIES BY OWNER-EMPLOYEE

                    Effective with respect to Plan Years beginning after
December 31, 1996, if this Plan provides contributions or benefits for one or
more Owner-Employees, the contributions on behalf of any Owner-Employee shall be
made only with respect to the Earned Income for such Owner-Employee which is
derived from the trade or business with respect to which such Plan is
established.

ARTICLE IV
CONTRIBUTION AND ALLOCATION

4.1 FORMULA FOR DETERMINING EMPLOYER’S CONTRIBUTION

 

 

 

(a) For a Money Purchase Plan:

 

 

 

(1) The Employer will make contributions on the following basis. On behalf of
each Participant eligible to share in allocations, for each year of such
Participant’s participation in this Plan, the Employer will contribute the
amount elected in the Adoption Agreement. All contributions by the Employer will
be made in cash. In the event a funding waiver is obtained, this Plan shall be
deemed to be an individually designed plan.

 

 

 

(2) Notwithstanding the foregoing, with respect to an Employer which is not a
tax-exempt entity, 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 that is deductible under Code Section 404.

 

 

 

(b) For a Profit Sharing Plan:

 

 

 

(1) For each Plan Year, the Employer may (or will in the case of a Prevailing
Wage contribution) contribute to the Plan such amount as elected by the Employer
in the Adoption Agreement.

 

 

 

(2) Additionally, the Employer will contribute to the Plan the amount necessary,
if any, to provide the top heavy minimum allocations, even if it exceeds current
or accumulated Net Profit or the amount that is deductible under Code Section
404.

4.2 TIME OF PAYMENT OF EMPLOYER’S CONTRIBUTION

                    Unless otherwise provided by contract or law, the Employer
may make its contribution to the Plan for a particular Plan Year at such time as
the Employer, in its sole discretion, determines. If the Employer makes a
contribution for a particular Plan Year after the close of that Plan Year, the
Employer will designate to the Administrator the Plan Year for which the
Employer is making its contribution.

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
contribution, if any, 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 any contributions as follows:

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

(1) For a Money Purchase Plan (other than a Money Purchase Plan which is
integrated by allocation):

 

 

 

 

 

(i) The Employer’s contribution shall be allocated to each Participant’s Account
in the manner set forth in Section 4.1 herein and as specified in the Adoption
Agreement.

 

 

 

 

 

(ii) However, regardless of the preceding, a Participant shall only be eligible
to share in the allocations of the Employer’s contribution for the year if the
conditions set forth in the Adoption Agreement are satisfied, unless a top heavy
contribution is required pursuant to Section 4.3(f). If no election is made in
the Adoption Agreement, then a Participant shall be eligible to share in the
allocation of the Employer’s contribution for the year if the Participant
completes more than five hundred (500) Hours of Service (or three (3) Months of
Service if the Elapsed Time method is chosen in the Adoption Agreement) during
the Plan Year or who is employed on the last day of the Plan Year. Furthermore,
with respect to a non-standardized Adoption Agreement, regardless of any
election in the Adoption Agreement to the contrary, for the Plan Year in which
this Plan terminates, a Participant shall only be eligible to share in the
allocation of the Employer’s contributions for the Plan Year if the Participant
is employed at the end of the Plan Year and has completed a Year of Service (or
Period of Service if the Elapsed Time Method is elected).

 

 

 

 

(2) For an integrated Profit Sharing Plan allocation or a Money Purchase Plan
which is integrated by allocation:

 

 

 

 

 

(i) Except as provided in Section 4.3(f) for top heavy purposes and subject to
the “Overall Permitted Disparity Limits,” the Employer’s contribution shall be
allocated to each Participant’s Account in a dollar amount equal to 5.7% of the
sum of each Participant’s 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 each such
Participant’s Compensation plus Excess Compensation for the Plan Year bears to
the total Compensation plus the total Excess Compensation of all Participants
for that year. However, in the case of any Participant who has exceeded the
“Cumulative Permitted Disparity Limit,” the allocation set forth in this
paragraph shall be based on such Participant’s Compensation rather than
Compensation plus Excess Compensation.

 

 

 

 

 

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 Account in the same proportion
that each such Participant’s Compensation for the Year bears to the total
Compensation of all Participants for such year.

 

 

 

 

 

(iii) However, regardless of the preceding, a Participant shall only be eligible
to share in the allocations of the Employer’s Contribution for the year if the
conditions set forth in the Adoption Agreement are satisfied, unless a
contribution is required pursuant to Section 4.3(f). If no election is made in
the Adoption Agreement, then a Participant shall be eligible to share in the
allocation of the Employer’s contribution for the year if the Participant
completes more than five hundred (500) Hours of Service (or three (3) Months of
Service if the Elapsed Time method is chosen in the Adoption Agreement) during
the Plan Year or who is employed on the last day of the Plan Year. Furthermore,
with respect to a non-standardized Adoption Agreement, regardless of any
election in the Adoption Agreement to the contrary, for the Plan Year in which
this Plan terminates, a Participant shall only be eligible to share in the
allocation of the Employer’s contributions for the Plan Year if the Participant
is employed at the end of the Plan Year and has completed a Year of Service (or
Period of Service if the Elapsed Time Method is elected).

 

 

 

 

(3) For a Profit Sharing Plan with a non-integrated allocation formula or a
Prevailing Wage contribution:

 

 

 

 

 

(i) The Employer’s contribution shall be allocated to each Participant’s Account
in accordance with the allocation method elected in the Adoption Agreement.

 

 

 

 

 

(ii) However, regardless of the preceding, a Participant shall only be eligible
to share in the allocations of the Employer’s contribution for the year if the
conditions set forth in the Adoption Agreement are satisfied, unless a top heavy
contribution is required pursuant to Section 4.3(f). If no election is made in
the Adoption Agreement, then a Participant shall be eligible to share in the
allocation of the Employer’s contribution for the year if the Participant
completes more than five

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

 

 

hundred (500) Hours of Service (or three (3) Months of Service if the Elapsed
Time method is chosen in the Adoption Agreement) during the Plan Year or who is
employed on the last day of the Plan Year. Furthermore, with respect to a
non-standardized Adoption Agreement, regardless of any election in the Adoption
Agreement to the contrary, for the Plan Year in which this Plan terminates, a
Participant shall only be eligible to share in the allocation of the Employer’s
contributions for the Plan Year if the Participant is employed at the end of the
Plan Year and has completed a Year of Service (or Period of Service if the
Elapsed Time Method is elected).

 

 

 

 

 

 

(4) “Overall Permitted Disparity Limits”:

 

 

 

 

 

 

 

“Annual Overall Permitted Disparity Limit”: Notwithstanding the preceding
paragraphs, if in any Plan Year this Plan “benefits” any Participant who
“benefits” under another qualified plan or simplified employee pension, as
defined in Code Section 408(k), maintained by the Employer that either provides
for or imputes permitted disparity (integrates), then such plans will be
considered to be one plan and will be considered to comply with the permitted
disparity rules if the extent of the permitted disparity of all such plans does
not exceed 100%. For purposes of the preceding sentence, the extent of the
permitted disparity 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 under Code
Section 401(l) applicable to such Plan. Notwithstanding the foregoing, if the
Employer maintains two or more standardized paired plans, only one plan may
provide for permitted disparity.

 

 

 

 

 

 

 

“Cumulative Permitted Disparity Limit”: With respect to a Participant who
“benefits” or “has benefited” under a defined benefit or target benefit plan of
the Employer, effective for Plan Years beginning on or after January 1, 1994,
the cumulative permitted disparity limit for the Participant is thirty five (35)
total cumulative permitted disparity years. Total cumulative permitted disparity
years means the number of years credited to the Participant for allocation or
accrual purposes under the Plan, any other qualified plan or simplified employee
pension plan (whether or not terminated) ever maintained by the Employer, while
such plan either provides for or imputes permitted disparity. For purposes of
determining the Participant’s cumulative permitted disparity limit, all years
ending in the same calendar year are treated as the same year. If the
Participant has not “benefited” under a defined benefit or target benefit plan
which neither provides for nor imputes permitted disparity for any year
beginning on or after January 1, 1994, then such Participant has no cumulative
disparity limit.

 

 

 

 

 

 

 

For purposes of this Section, “benefiting” means benefiting under the Plan for
any Plan Year during which a Participant received or is deemed to receive an
allocation in accordance with Regulation 1.410(b)-3(a).

 

 

 

 

 

          (c) Except as otherwise elected in the Adoption Agreement or as
provided in Section 4.10 with respect to Participant Directed Accounts, as of
each Valuation Date, before allocation of any Employer contributions and
Forfeitures, any earnings or losses (net appreciation or net depreciation) of
the Trust Fund (exclusive of assets segregated for distribution) shall be
allocated in the same proportion that each Participant’s and Former
Participant’s nonsegregated accounts bear to the total of all Participants’ and
Former Participants’ nonsegregated accounts as of such date. If any
nonsegregated account of a Participant has been distributed prior to the
Valuation Date subsequent to a Participant’s termination of employment, no
earnings or losses shall be credited to such account.

 

 

 

 

 

          (d) Participants’ Accounts shall be debited for any insurance or
annuity premiums paid, if any, and credited with any dividends or interest
received on Contracts.

 

 

 

 

 

          (e) On or before each Anniversary Date, any amounts which became
Forfeitures since the last Anniversary Date may be made available to reinstate
previously forfeited account balances of Former Participants, if any, in
accordance with Section 3.5(d) or used to satisfy any contribution that may be
required pursuant to Section 6.9. The remaining Forfeitures, if any, shall be
treated in accordance with the Adoption Agreement. If no election is made in the
Adoption Agreement, any remaining Forfeitures will be used to reduce any future
Employer contributions under the Plan. However, if the Plan provides for an
integrated allocation, then any remaining Forfeitures will be added to the
Employer’s contributions under the Plan. Regardless of the preceding sentences,
in the event the allocation of Forfeitures provided herein shall cause the
“Annual Additions” (as defined in Section 4.4) to any Participant’s Account to
exceed the amount allowable by the Code, an adjustment shall be made in
accordance with Section 4.5. Except, however, a Participant shall only be
eligible to share in the allocations of Forfeitures for the year if the
conditions set forth in the Adoption Agreement are satisfied, unless a top heavy
contribution is required pursuant to Section 4.3(f). If no election is made in
the Adoption Agreement, then a Participant shall be eligible to share in the
allocation of the Employer’s contribution for the year if the Participant
completes more than five hundred (500) Hours of Service (or three (3) Months of
Service if the Elapsed Time method is chosen in the Adoption Agreement) during
the Plan Year or who is employed on the last day of the Plan Year.

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DEFINED CONTRIBUTION PLAN

 

 

 

 

          (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” (as
defined in Section 9.2(f)). 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 a “required aggregation group” (as defined in Section 9.2(f)) 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 three percent (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 and shall still
be required to satisfy the other provisions of this subsection:

 

 

 

 

 

(1) An amount equal to three percent (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
such Participant’s 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 three percent (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 such Participant’s Excess Compensation bears to the
total Excess Compensation of all Participants for that year. For purposes of
this paragraph, in the case of any Participant who has exceeded the cumulative
permitted disparity limit described in Section 4.3(b)(4), such Participant’s
total Compensation will be taken into account.

 

 

 

 

 

(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 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 such Participant’s total Compensation
plus Excess Compensation for the Plan Year bears to the total Compensation plus
Excess Compensation of all Participants for that year. For purposes of this
paragraph, in the case of any Participant who has exceeded the cumulative
permitted disparity limit described in Section 4.3(b)(4), such Participant’s
total Compensation rather than Compensation plus Excess Compensation will be
taken into account.

 

 

 

 

 

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 such Participant’s 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 three percent (3%) allocation specified above shall be provided as
specified in 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

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

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 Deferrals 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” (as defined in Section 9.2(f))
which is top heavy, the Employer will not be required (unless otherwise elected
in the Adoption Agreement) to provide a Non-Key Employee with both the full
separate minimum defined benefit plan benefit and the full separate defined
contribution plan allocations. In such case, the top heavy minimum benefits will
be provided as elected in the Adoption Agreement and, if applicable, as follows:

 

 

 

 

(1) If the 5% defined contribution minimum is elected in the Adoption Agreement:

 

 

 

 

 

 

(i) The requirements of Section 9.1 will 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 will 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 two
percent (2%) of such Participant’s highest five (5) 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 (10).

 

 

 

 

 

 

 

(iii) For each Non-Key Employee who is a Participant only in this defined
contribution plan, the Employer will provide a minimum allocation equal to three
percent (3%) of such Participant’s 415 Compensation.

 

 

 

 

 

 

(2) If the 2% defined benefit minimum is elected in the Adoption Agreement, then
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 two percent
(2%) of such Participant’s highest five (5) consecutive year average of 415
Compensation for each Year of Service while a participant in the plan, in which
the Plan is top heavy, not to exceed ten (10).

 

 

 

 

          (j) For the purposes of this Section, 415 Compensation will be limited
to the same dollar limitations set forth in Section 1.11 adjusted in such manner
as permitted under Code Section 415(d).

 

 

 

          (k) Notwithstanding anything in this Section to the contrary, all
information necessary to properly reflect a given transaction may not be
available until after the date specified herein for processing such transaction,
in which case the transaction will be reflected when such information is
received and processed. Subject to express limits that may be imposed under the
Code, the processing of any contribution, distribution or other transaction may
be delayed for any legitimate business reason (including, but not limited to,
failure of systems or computer programs, failure of the means of the
transmission of data, force majeure, the failure of a service provider to timely
receive values or prices, and correction for errors or omissions or the errors
or omissions of any service provider). The processing date of a transaction will
be binding for all purposes of the Plan.

 

 

 

          (l) Notwithstanding anything in this Section to the contrary, the
provisions of this subsection apply for any Plan Year if, in the
non-standardized Adoption Agreement, the Employer elected to apply the 410(b)
ratio percentage failsafe provisions and the Plan fails to satisfy the “ratio
percentage test” due to a last day of the Plan Year allocation condition or an
Hours of Service (or months of service) allocation condition. A plan satisfies
the “ratio percentage test” if, on the last day of the Plan Year, the
“benefiting ratio” of the Non-Highly Compensated Employees who are “includible”
is at least 70% of the “benefiting ratio” of the Highly Compensated Employees
who are “includible.” The “benefiting ratio” of the Non-Highly Compensated
Employees is the number of “includible” Non-Highly Compensated Employees
“benefiting” under the Plan divided by the number of “includible” Employees who
are Non-Highly Compensated Employees. The “benefiting ratio” of the Highly
Compensated Employees is the number of Highly Compensated Employees “benefiting”
under the Plan divided by the number of “includible” Highly Compensated
Employees. “Includible” Employees are all Employees other than: (1) those
Employees excluded from participating in the plan for the entire Plan Year by
reason of the collective bargaining unit exclusion or the nonresident alien
exclusion described in the Code or by reason of the age and service requirements
of Article III; and (2) any Employee who incurs a separation from service during
the Plan Year and fails to complete at least 501 Hours of Service (or three (3)
months of service if the Elapsed Time Method is being used) during such Plan
Year.

 

 

 

                    For purposes of this subsection, an Employee is “benefiting”
under the Plan on a particular date if, under the Plan, the Employee is entitled
to an Employer contribution or an allocation of Forfeitures for the Plan Year.

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

                    If this subsection applies, then the Administrator will
suspend the allocation conditions for the “includible” Non-Highly Compensated
Employees who are Participants, beginning first with the “includible” Employees
employed by the Employer on the last day of the Plan Year, then the “includible”
Employees who have the latest separation from service during the Plan Year, and
continuing to suspend the allocation conditions for each “includible” Employee
who incurred an earlier separation from service, from the latest to the earliest
separation from service date, until the Plan satisfies the “ratio percentage
test” for the Plan Year. If two or more “includible” Employees have a separation
from service on the same day, then the Administrator will suspend the allocation
conditions for all such “includible” Employees, irrespective of whether the Plan
can satisfy the “ratio percentage test” by accruing benefits for fewer than all
such “includible” Employees. If the Plan for any Plan Year suspends the
allocation conditions for an “includible” Employee, then that Employee will
share in the allocation for that Plan Year of the Employer contribution and
Forfeitures, if any, without regard to whether the Employee has satisfied the
other allocation conditions set forth in this Section.

 

 

4.4 MAXIMUM ANNUAL ADDITIONS

 

 

          (a)(1) If a 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(e)) maintained by the Employer, or
an individual medical account (as defined in Code Section 415(l)(2)) maintained
by the Employer, or a simplified employee pension (as defined in Code Section
408(k)) 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,” and any amount in excess of the
“Maximum Permissible Amount” which would have been allocated to such Participant
may be allocated to other Participants.

 

 

 

 

(2) Prior to determining the Participant’s actual 415 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 415
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 415 Compensation for such Limitation Year.

 

 

 

 

          (b)(1) This subsection applies if, in addition to this Plan, a
Participant is covered under another qualified defined contribution plan
maintained by the Employer that is a “Master or Prototype Plan,” a welfare
benefit fund (as defined in Code Section 419(e)) maintained by the Employer, an
individual medical account (as defined in Code Section 415(l)(2)) maintained by
the Employer, or a simplified employee pension (as defined in Code Section
408(k)) 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, individual medical accounts, and simplified employee pensions 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,” and any amount in excess of the “Maximum Permissible
Amount” which would have been allocated to such Participant may be allocated to
other Participants. If the “Annual Additions” with respect to the Participant
under such other defined contribution plans, welfare benefit funds, individual
medical accounts and simplified employee pensions 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 415 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 415
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 the Limitation Year will be
determined on the basis of the Participant’s actual 415 Compensation for the
Limitation Year.

(C) 2001 Markley Actuarial Services, Inc.

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

 

 

(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 simplified employee pension will be deemed to have been
allocated first, followed by “Annual Additions” to a welfare benefit fund or
individual medical account, and then by “Annual Additions” to a plan subject to
Code Section 412, 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 of in the
manner described in Section 4.5.

 

 

 

 

          (c) If the Participant is covered under another qualified defined
contribution plan maintained by the Employer which is not a “Master or Prototype
Plan,” “Annual Additions” which may be credited to the Participant’s Combined
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) For any Limitation Year beginning prior to the date the Code
Section 415(e) limits are repealed with respect to this Plan (as specified in
the Adoption Agreement for the GUST transitional rules), if the Employer
maintains, or at any time maintained, a qualified defined benefit plan covering
any Participant in this Plan, then the sum of the Participant’s “Defined Benefit
Plan Fraction” and “Defined Contribution Plan Fraction” may not exceed 1.0. In
such event, the rate of accrual in the defined benefit plan will be reduced to
the extent necessary so that the sum of the “Defined Contribution Fraction” and
“Defined Benefit Fraction” will equal 1.0. However, in the Adoption Agreement
the Employer may specify an alternative method under which the plans involved
will satisfy the limitations of Code Section 415(e), including increased top
heavy minimum benefits so that the combined limitation is 1.25 rather than 1.0.

 

 

 

          (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)(b): (1) rollover contributions (as defined in Code
Sections 402(c), 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:

 

 

 

 

(1) “Annual Additions” means the sum credited to a Participant’s accounts for
any Limitation Year of (a) Employer contributions, (b) Employee contributions
(except as provided below), (c) forfeitures, (d) 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, (e) 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 and (f)
allocations under a simplified employee pension. Except, however, the
Compensation percentage limitation referred to in paragraph (f)(9)(ii) 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 Section
4.5 in the Limitation Year to reduce Employer contributions shall be considered
“Annual Additions” for such Limitation Year.

 

 

 

 

 

(2) “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

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DEFINED CONTRIBUTION PLAN

 

 

 

Employer, and the denominator of which is the lesser of one hundred twenty-five
percent (125%) of the dollar limitation determined for the Limitation Year under
Code Sections 415(b)(1)(A) as adjusted by Code Section 415(d) or one hundred
forty percent (140%) of the “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 one hundred twenty-five percent (125%) 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,
one hundred percent (100%) shall be substituted for one hundred twenty-five
percent (125%) unless the extra top heavy minimum allocation or benefit is being
made pursuant to the Employer’s specification in the Adoption Agreement.
However, for any Plan Year in which this Plan is a Super Top Heavy Plan, one
hundred percent (100%) shall always be substituted for one hundred twenty-five
percent (125%).

 

 

 

(3) Defined Contribution Dollar Limitation means $30,000 as adjusted under Code
Section 415(d).

 

 

 

(4) Defined Contribution Fraction means a fraction, the numerator of which is
the sum of the “Annual Additions” to the Participant’s accounts 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)), individual medical
accounts (as defined in Code Section 415(l)(2)), and simplified employee
pensions (as defined in Code Section 408(k)) 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 in which the Employee had 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 one hundred twenty-five percent (125%) of the dollar limitation
determined under Code Section 415(c)(1)(A) as adjusted by Code Section 415(d) or
thirty-five percent (35%) of the Participant’s 415 Compensation for such year.

 

 

 

                    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.

 

 

 

                    For Limitation Years beginning prior to January 1, 1987, the
“Annual Additions” shall not be recomputed to treat all Employee contributions
as “Annual Additions.”

 

 

 

                    Notwithstanding the foregoing, for any Top Heavy Plan Year,
one hundred percent (100%) shall be substituted for one hundred twenty-five
percent (125%) unless the extra top heavy minimum allocation or benefit is being
made pursuant to the Employer’s specification in the Adoption Agreement.
However, for any Plan Year in which this Plan is a Super Top Heavy Plan, one
hundred percent (100%) shall always be substituted for one hundred twenty-five
percent (125%).

 

 

 

(5) “Employer” means the Employer that adopts this Plan and all Affiliated
Employers, except that for purposes of this Section, the determination of
whether an entity is an Affiliated Employer shall be made by applying Code
Section 415(h).

 

 

 

(6) “Excess Amount” means the excess of the Participant’s “Annual Additions” for
the Limitation Year over the “Maximum Permissible Amount.”

 

 

 

(7) “Highest Average Compensation” means the average Compensation for the three
(3) consecutive Years of Service with the Employer while a Participant in the
Plan that produces the highest average. A Year

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

 

 

of Service with the Employer is the twelve (12) consecutive month period ending
on the last day of the Limitation Year.

 

 

 

 

 

(8) “Master or Prototype Plan” means a plan the form of which is the subject of
a favorable opinion letter from the Internal Revenue Service.

 

 

 

 

 

(9) “Maximum Permissible Amount” means the maximum Annual Addition that may be
contributed or allocated to a Participant’s accounts under the Plan for any
“Limitation Year,” which shall not exceed the lesser of:

 

 

 

 

 

 

(i) the “Defined Contribution Dollar Limitation,” or

 

 

 

 

 

 

 

(ii) twenty-five percent (25%) of the Participant’s 415 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(f)(2)) which is otherwise treated as an “Annual Addition.”

 

 

 

 

 

 

 

          If a short Limitation Year is created because of an amendment changing
the Limitation Year to a different twelve (12) consecutive month period, the
“Maximum Permissible Amount” will not exceed the “Defined Contribution Dollar
Limitation multiplied by a fraction, the numerator of which is the number of
months in the short Limitation Year and the denominator of which is twelve (12).

 

 

 

 

 

 

(10) “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 415 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.

 

 

 

 

 

 

For purposes of this subsection, “straight life annuity” means an annuity that
is payable in equal installments for the life of the Participant that terminates
upon the Participant’s death.

 

 

 

 

          (g) 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.

 

 

4.5 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS

 

                    Allocation of “Annual Additions” (as defined in Section 4.4)
to a Participant’s Combined Account for a Limitation Year generally will cease
once the limits of Section 4.4 have been reached for such Limitation Year.
However, if as a result of the allocation of Forfeitures, a reasonable error in
estimating a Participant’s annual 415 Compensation, a reasonable error in
determining the amount of 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 “Excess Amount” will be
disposed of in one of the following manners, as uniformly determined by the Plan
Administrator for all Participants similarly situated:

 

 

          (a) Any after-tax voluntary Employee contributions (plus attributable
gains), to the extent they would reduce the Excess Amount, will be distributed
to the Participant;

 

 

 

          (b) If, after the application of subparagraph (a), an “Excess Amount”
still exists, any unmatched Elective Deferrals (and for Limitation Years
beginning after December 31, 1995, any gains attributable to such Elective
Deferrals), to the extent they would reduce the Excess Amount, will be
distributed to the Participant;

 

 

 

          (c) To the extent necessary, matched Elective Deferrals and Employer
matching contributions will be proportionately reduced from the Participant’s
Account. The Elective Deferrals (and for Limitation Years beginning after
December 31, 1995, any gains attributable to such Elective Deferrals) will be
distributed to the Participant and the

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DEFINED CONTRIBUTION PLAN

 

 

 

Employer matching contributions (and for Limitation Years beginning after
December 31, 1995, any gains attributable to such matching contributions) will
be used to reduce the Employer’s contributions in the next Limitation Year;

 

 

 

          (d) If, after the application of subparagraphs (a), (b) and (c), 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;

 

 

 

          (e) If, after the application of subparagraphs (a), (b) and (c), 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
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; and

 

 

 

          (f) If a suspense account is in existence at any time during a
Limitation Year pursuant to this Section, no investment gains and losses shall
be allocated to such suspense account. 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 Limitation Year. Except as provided in (a), (b) and (c) above, “Excess
Amounts” may not be distributed to Participants or Former Participants.

 

 

4.6 ROLLOVERS

 

 

          (a) If elected in the Adoption Agreement and with the consent of the
Administrator, the Plan may accept a “rollover,” provided the “rollover” will
not jeopardize the tax-exempt status of the Plan or create adverse tax
consequences for the Employer. The amounts rolled over 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. For purposes of this Section, the term Participant
shall include any Eligible Employee who is not yet a Participant, if, pursuant
to the Adoption Agreement, “rollovers” are permitted to be accepted from
Eligible Employees. In addition, for purposes of this Section the term
Participant shall also include former Employees if the Employer and
Administrator consent to accept “rollovers” of distributions made to former
Employees from any plan of the Employer.

 

 

 

          (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 elected in the
Adoption Agreement and subsection (c) below. The Trustee shall have no duty or
responsibility to inquire as to the propriety of the amount, value or type of
assets transferred, nor to conduct any due diligence with respect to such
assets; provided, however, that such assets are otherwise eligible to be held by
the Trustee under the terms of this Plan.

 

 

 

          (c) At Normal Retirement Date, or such other date when the Participant
or Eligible Employee or such Participant’s or Eligible Employee’s Beneficiary
shall be entitled to receive benefits, the Participant’s Rollover Account shall
be used to provide additional benefits to the Participant or the Participant’s
Beneficiary. Any distribution of amounts held in a Participant’s Rollover
Account shall be made in a manner which is consistent with and satisfies the
provisions of Sections 6.5 and 6.6, 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 to be part of a
Participant’s benefit in determining whether an involuntary cash-out of benefits
may be made without Participant consent.

 

 

 

          (d) The Administrator may direct that rollovers 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, invested as part of the general Trust Fund or, if elected in
the Adoption Agreement, directed by the Participant.

 

 

 

          (e) For purposes of this Section, the term “qualified plan” shall mean
any tax qualified plan under Code Section 401(a), or any other plans from which
distributions are eligible to be rolled over into this Plan pursuant to the
Code. The term “rollover” means: (i) amounts transferred to this Plan in a
direct rollover made pursuant to Code Section 401(a)(31) from another “qualified
plan”; (ii) distributions received by an Employee from other “qualified plans”
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
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” (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; (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 receipt thereof from such conduit individual
retirement account; and (v) any other amounts which are eligible to be rolled
over to this Plan pursuant to the Code.

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DEFINED CONTRIBUTION PLAN

 

 

 

          (f) Prior to accepting any “rollovers” to which this Section applies,
the Administrator may require the Employee to establish (by providing opinion of
counsel or otherwise) that the amounts to be rolled over to this Plan meet the
requirements of this Section.

 

 

4.7 PLAN-TO-PLAN TRANSFERS FROM QUALIFIED PLANS

 

 

 

          (a) With the consent of the Administrator, amounts may be transferred
(within the meaning of Code Section 414(l)) to this Plan from other tax
qualified plans under Code Section 401(a), provided the plan 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 Trust or create adverse tax
consequences for the Employer. Prior to accepting any transfers to which this
Section applies, the Administrator may require an opinion of counsel that the
amounts to be transferred meet the requirements of this Section. The amounts
transferred shall be set up in a separate account herein referred to as a
“Participant’s Transfer Account.” Furthermore, for Vesting purposes, the
Participant’s Transfer Account shall be treated as a separate “Participant’s
Account.”

 

 

 

          (b) Amounts in a Participant’s Transfer 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 elected in the
Adoption Agreement and subsection (d) below, provided the restrictions of
subsection (c) below and Section 6.15 are satisfied. The Trustee shall have no
duty or responsibility to inquire as to the propriety of the amount, value or
type of assets transferred, nor to conduct any due diligence with respect to
such assets; provided, however, that such assets are otherwise eligible to be
held by the Trustee under the terms of this Plan.

 

 

 

          (c) Except as permitted by Regulations (including Regulation
1.411(d)-4), amounts attributable to elective contributions (as defined in
Regulation 1.401(k)-1(g)(3)), including amounts treated as elective
contributions, which are transferred from another qualified plan in a
plan-to-plan transfer (other than a direct rollover) 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 the Participant’s Beneficiary shall be entitled to receive benefits, the
Participant’s Transfer Account shall be used to provide additional benefits to
the Participant or the Participant’s Beneficiary. Any distribution of amounts
held in a Participant’s Transfer Account shall be made in a manner which is
consistent with and satisfies the provisions of Sections 6.5 and 6.6, 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 to be part of a Participant’s benefit in determining whether
an involuntary cash-out of benefits may be made without Participant consent.

 

 

 

          (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, invested as part of the general Trust Fund or, if
elected in the Adoption Agreement, directed by the Participant.

 

 

 

          (f) 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 411(d)(6) protected benefit” as
described in Section 8.1(e).

 

 

4.8 VOLUNTARY EMPLOYEE CONTRIBUTIONS

 

 

          (a) Except as provided in subsection 4.8(b) below, this Plan will not
accept after-tax voluntary Employee contributions. If this is an amendment to a
Plan that had previously allowed after-tax voluntary Employee contributions,
then this Plan will not accept after-tax 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 who is eligible to make Elective Deferrals may, in accordance with
nondiscriminatory procedures established by the Administrator, elect to make
after-tax voluntary Employee contributions to this Plan. Such contributions must
generally be paid to the Trustee within a reasonable period of time after being
received by the Employer.

 

 

 

          (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 at any time to withdraw after-tax
voluntary Employee contributions from such Participant’s 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 after-tax voluntary Employee contributions (and earnings thereon) which were
made on or before a specified date, a

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DEFINED CONTRIBUTION PLAN

 

 

 

Participant shall be permitted to designate which sub-account shall be the
source for the withdrawal. Forfeitures of Employer contributions shall not occur
solely as a result of an Employee’s withdrawal of after-tax voluntary Employee
contributions.

 

 

 

          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 the Participant shall be barred from making any after-tax
voluntary Employee contributions for a period of twelve (12) months after
receipt of the hardship distribution.

 

 

 

          (e) At Normal Retirement Date, or such other date when the Participant
or the Participant’s Beneficiary is entitled to receive benefits, the
Participant’s Voluntary Contribution Account shall be used to provide additional
benefits to the Participant or the Participant’s Beneficiary.

 

 

 

          (f) To the extent a Participant has previously made mandatory Employee
contributions under prior provisions of this Plan, such contributions will be
treated as after-tax voluntary Employee contributions.

4.9 QUALIFIED VOLUNTARY EMPLOYEE CONTRIBUTIONS

 

 

 

          (a) If this is an amendment to a Plan that previously permitted
deductible voluntary Employee contributions, then each Participant who made
“Qualified Voluntary Employee Contributions” within the meaning of Code Section
219(e)(2) as it existed prior to the enactment of the Tax Reform Act of 1986,
shall have such contributions held in a separate Qualified Voluntary Employee
Contribution Account which shall be fully Vested at all times. Such
contributions, however, shall not be permitted for taxable years beginning after
December 31, 1986.

 

 

 

          (b) A Participant may, upon written request delivered to the
Administrator, make withdrawals from such Participant’s 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 the Participant’s Beneficiary is entitled to receive benefits, the Qualified
Voluntary Employee Contribution Account shall be used to provide additional
benefits to the Participant or the Participant’s Beneficiary.

4.10 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 their individual account
balances as set forth in the Adoption Agreement and within limits set by the
Employer. Participants may direct the Trustee, in writing (or in such other form
which is acceptable to the Trustee), to invest their accounts in specific
assets, specific funds or other investments permitted under the Plan and the
Participant Direction Procedures. That portion of the account of any Participant
that is subject to investment direction of such Participant will be considered a
Participant Directed Account.

 

 

 

 

          (b) The Administrator will establish a Participant Direction
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 and provisions that
the Administrator may impose on a Participant’s right to direct investments.

 

 

 

 

          (c) The Administrator may, in its discretion, include or exclude by
amendment or other action from the Participant Direction Procedures such
instructions, guidelines or policies as it deems necessary or appropriate to
ensure proper administration of the Plan, and may interpret the same
accordingly.

 

 

 

 

          (d) As of each Valuation Date, all Participant Directed Accounts shall
be charged or credited with the net earnings, gains, losses and expenses as well
as any appreciation or depreciation in the market value using publicly listed
fair market values when available or appropriate as follows:

 

 

 

 

 

(1) to the extent the assets in a Participant Directed Account are accounted for
as pooled assets or investments, the allocation of earnings, gains and losses of
each Participant’s Account shall be based upon the total amount of funds so
invested in a manner proportionate to the Participant’s share of such pooled
investment; and

 

 

 

 

 

(2) to the extent the assets in a Participant Directed Account are accounted for
as segregated assets, the allocation of earnings, gains on and losses from such
assets shall be made on a separate and distinct basis.

 

 

 

 

          (e) Investment directions will be processed as soon as
administratively practicable after proper investment directions are received
from the Participant. No guarantee is made by the Plan, Employer, Administrator
or Trustee that investment directions will be processed on a daily basis, and no
guarantee is made in any respect regarding

 

 

 

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the processing time of an investment direction. Notwithstanding any other
provision of the Plan, the Employer, Administrator or Trustee reserves the right
to not value an investment option on any given Valuation Date for any reason
deemed appropriate by the Employer, Administrator or Trustee. Furthermore, the
processing of any investment transaction may be delayed for any legitimate
business reason (including, but not limited to, failure of systems or computer
programs, failure of the means of the transmission of data, force majeure, the
failure of a service provider to timely receive values or prices, and correction
for errors or omissions or the errors or omissions of any service provider). The
processing date of a transaction will be binding for all purposes of the Plan
and considered the applicable Valuation Date for an investment transaction.

 

 

 

          (f) If the Employer has elected in the Adoption Agreement that it
intends to operate any portion of this Plan as an Act Section 404(c) plan, the
Participant Direction Procedures should provide an explanation of the
circumstances under which Participants and their Beneficiaries may give
investment instructions, including but not limited to, the following:

 

 

 

(1) the conveyance of instructions by the Participants and their Beneficiaries
to invest Participant Directed Accounts in a Directed Investment Option;

 

 

 

(2) the name, address and phone number of the Fiduciary (and, if applicable, the
person or persons designated by the Fiduciary to act on its behalf) responsible
for providing information to the Participant or a Beneficiary upon request
relating to the Directed Investment Options;

 

 

 

(3) applicable restrictions on transfers to and from any Designated Investment
Alternative;

 

 

 

(4) any restrictions on the exercise of voting, tender and similar rights
related to a Directed Investment Option by the Participants or their
Beneficiaries;

 

 

 

(5) a description of any transaction fees and expenses which affect the balances
in Participant Directed Accounts in connection with the purchase or sale of a
Directed Investment Option; and

 

 

 

(6) general procedures for the dissemination of investment and other information
relating to the Designated Investment Alternatives as deemed necessary or
appropriate, including but not limited to a description of the following:

 

 

 

(i) the investment vehicles available under the Plan, including specific
information regarding any Designated Investment Alternative;

 

 

 

(ii) any designated Investment Managers; and

 

 

 

(iii) a description of the additional information that may be obtained upon
request from the Fiduciary designated to provide such information.

 

 

 

 

          (g) With respect to those assets in a Participant’s Directed Account,
the Participant or Beneficiary shall direct the Trustee with regard to any
voting, tender and similar rights associated with the ownership of such assets
(hereinafter referred to as the “Stock Rights”) as follows based on the election
made in the Adoption Agreement:

 

 

 

 

 

(1) each Participant or Beneficiary shall direct the Trustee to vote or
otherwise exercise such Stock Rights in accordance with the provisions,
conditions and terms of any such Stock Rights;

 

 

 

 

 

(2) such directions shall be provided to the Trustee by the Participant or
Beneficiary in accordance with the procedure as established by the Administrator
and the Trustee shall vote or otherwise exercise such Stock Rights with respect
to which it has received directions to do so under this Section; and

 

 

 

 

 

(3) to the extent to which a Participant or Beneficiary does not instruct the
Trustee to vote or otherwise exercise such Stock Rights, such Participants or
Beneficiaries shall be deemed to have directed the Trustee that such Stock
Rights remain nonvoted and unexercised.

 

 

 

 

 

(h) Any information regarding investments available under the Plan, to the
extent not required to be described in the Participant Direction Procedures, may
be provided to Participants in one or more documents (or in any other form,
including, but not limited to, electronic media) which are separate from the
Participant Direction Procedures and are not thereby incorporated by reference
into this Plan.

 

 

 

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4.11 INTEGRATION IN MORE THAN ONE PLAN

                     If the Employer maintains qualified retirement plans that
provide for permitted disparity (integration), the provisions of Section
4.3(b)(4) will apply. Furthermore, if the Employer maintains two or more
standardized paired plans, only one plan may provide for permitted disparity.

4.12 QUALIFIED MILITARY SERVICE

                     Notwithstanding any provisions of this Plan to the
contrary, effective as of the later of December 12, 1994, or the Effective Date
of the Plan, contributions, benefits and service credit with respect to
qualified military service will be provided in accordance with Code Section
414(u). Furthermore, loan repayments may be suspended under this Plan as
permitted under Code Section 414(u)(4).

ARTICLE V
VALUATIONS

5.1 VALUATION OF THE TRUST FUND

                    The Administrator shall direct the Trustee, as of each
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 (or their contractual value in the case of a Contract or Policy) as of the
Valuation Date and may deduct all expenses for which the Trustee has not yet
been paid by the Employer or the Trust Fund. The Trustee may update the value of
any shares held in a Participant Directed Account by reference to the number of
shares held on behalf of the Participant, priced at the market value as of the
Valuation Date.

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.

ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS

6.1 DETERMINATION OF BENEFITS UPON RETIREMENT

                    Every Participant may terminate employment with the Employer
and retire for purposes hereof on the Participant’s Normal Retirement Date or
Early Retirement Date. However, a Participant may postpone the termination of
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 such Participant’s Retirement
Date. Upon a Participant’s Retirement Date, or if elected in the Adoption
Agreement, the attainment of Normal Retirement Date without termination of
employment with the Employer, or as soon thereafter as is practicable, the
Administrator shall direct the distribution, at the election of the Participant,
of the Participant’s entire Vested interest in the Plan in accordance with
Section 6.5.

6.2 DETERMINATION OF BENEFITS UPON DEATH

 

 

 

          (a) Upon the death of a Participant before the Participant’s
Retirement Date or other termination of employment, all amounts credited to such
Participant’s Combined Account shall, if elected in the Adoption Agreement,
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 Vested 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 Vested 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.

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

          (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 surviving spouse. Except, however, the Participant may designate a
Beneficiary other than the spouse for the Pre-Retirement Survivor Annuity if:

 

 

 

 

 

(1) the Participant and the Participant’s spouse have validly waived the
Pre-Retirement Survivor Annuity in the manner prescribed in Section 6.6, and the
spouse has waived the right to be the Participant’s Beneficiary,

 

 

 

 

 

(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
there is no “qualified domestic relations order” as defined in Code Section
414(p) which provides otherwise),

 

 

 

 

 

(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 a designation of a Beneficiary or change a Beneficiary by filing written
(or in such other form as permitted by the IRS) notice of such revocation or
change with the Administrator. However, the Participant’s spouse must again
consent in writing (or in such other form as permitted by the IRS) 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.

 

 

 

 

          (e) A Participant may, at any time, designate a Beneficiary for death
benefits, if any, payable under the Plan that are in excess of the
Pre-Retirement Survivor Annuity without the waiver or consent of the
Participant’s spouse. In the event no valid designation of Beneficiary exists,
or if the Beneficiary is not alive at the time of the Participant’s death, the
death benefit will be paid in the following order of priority, unless the
Employer specifies a different order of priority in an addendum to the Adoption
Agreement, to:

 

 

 

(1) The Participant’s surviving spouse;

 

 

 

(2) The Participant’s children, including adopted children, per stirpes

 

 

 

(3) The Participant’s surviving parents, in equal shares; or

 

 

 

(4) The Participant’s estate.

 

 

 

If the Beneficiary does not predecease the Participant, but dies prior to
distribution of the death benefit, the death benefit will be paid to the
Beneficiary’s estate.

 

 

 

          (f) Notwithstanding anything in this Section to the contrary, if a
Participant has designated the spouse as a Beneficiary, then a divorce decree or
a legal separation that relates to such spouse shall revoke the Participant’s
designation of the spouse as a Beneficiary unless the decree or a qualified
domestic relations order (within the meaning of Code Section 414(p)) provides
otherwise or a subsequent Beneficiary designation is made.

 

 

 

          (g) If the Plan provides an insured death benefit and a Participant
dies before any insurance coverage to which the Participant is entitled under
the Plan is effected, the death benefit from such insurance coverage shall be
limited to the premium which was or otherwise would have been used for such
purpose.

 

 

 

          (h) 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 the Participant’s Retirement Date or other termination of
employment, all amounts credited to such Participant’s Combined Account shall,
if elected in the Adoption Agreement, 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 the entire Vested interest in the Plan.

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6.4 DETERMINATION OF BENEFITS UPON TERMINATION

 

 

 

          (a) If a Participant’s employment with the Employer is terminated for
any reason other than death, Total and Permanent Disability, or retirement, then
such Participant shall be entitled to such benefits as are provided herein.

 

 

 

                    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 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 411(a)(11)
and 417 and the Regulations thereunder.

 

 

 

                    Regardless of whether distributions in kind are permitted,
in the event 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 such Terminated Participant’s 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.

 

 

 

                    Notwithstanding the above, unless otherwise elected in the
Adoption Agreement, if the value of a Terminated Participant’s Vested benefit
derived from Employer and Employee contributions does not exceed $5,000 (or,
$3,500 for distributions made prior to the later of the first day of the first
Plan Year beginning on or after August 5, 1997, or the date specified in the
Adoption Agreement) 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. Furthermore, the determination of whether the $5,000 (or, if applicable,
$3,500) threshold has been exceeded is generally based on the value of the
Vested benefit as of the Valuation Date preceding the date of the distribution.
However, if the “lookback rule” applies, the applicable threshold is deemed to
be exceeded if the Vested benefit exceeded the applicable threshold at the time
of any prior distribution. The “lookback rule” generally applies to all
distributions made prior to March 22, 1999. With respect to distributions made
on or after March 22, 1999, the “lookback rule” applies if either (1) the
provisions of Section 6.12 do not apply or (2) a Participant has begun to
receive distributions pursuant to an optional form of benefit under which at
least one scheduled periodic distribution has not yet been made, and if the
value of the Participant’s benefit, determined at the time of the first
distribution under that optional form of benefit exceeded the applicable
threshold. However, the Plan does not fail to satisfy the requirements of this
paragraph if, prior to the adoption of this Prototype Plan, the “lookback rule”
was applied to all distributions. Notwithstanding the preceding, the “lookback
rule” will not apply to any distributions made on or after October 17, 2000.

 

 

 

          (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 (or Periods of Service if the Elapsed
Time Method is elected) according to the vesting schedule specified in the
Adoption Agreement. However, a Participant’s entire interest in the Plan shall
be non-forfeitable upon the Participant’s Normal Retirement Age (if the
Participant is employed by the Employer on or after such date).

 

 

 

          (c) For any Top Heavy Plan Year, the minimum top heavy vesting
schedule 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 shall 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, then unless a specific Plan amendment is made to provide otherwise,
the Administrator will continue to use the vesting schedule in effect while the
Plan was a Top Heavy Plan.

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

          (d) Upon the complete discontinuance of the Employer’s contributions
to the Plan (if this is a profit sharing plan) or upon any full or partial
termination of the Plan, all amounts then 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 nonforfeitable percentage of
such Participant’s 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. Furthermore, if the Plan’s vesting schedule
is amended, then the amended schedule will only apply to those Participants who
complete an Hour of Service after the effective date of the amendment.

 

 

 

 

          (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 nonforfeitable percentage or if the Plan is deemed amended by an
automatic change to a top heavy vesting schedule, then each Participant with at
least three (3) Years of Service (or Periods of Service if the Elapsed Time
Method is elected) as of the expiration date of the election period may elect to
have such Participant’s nonforfeitable percentage computed under the Plan
without regard to such amendment or change. 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 sixty (60) days after the latest of:

 

 

 

 

 

(1) the adoption date of the amendment,

 

 

 

 

 

(2) the effective date of the amendment, or

 

 

 

 

 

(3) the date the Participant receives written notice of the amendment from the
Employer or Administrator.

 

 

 

 

          (g) In determining Years of Service or Periods of Service for purposes
of vesting under the Plan, Years of Service or Periods of Service shall be
excluded as elected 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 Plan 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 either fifty percent
(50%), seventy-five percent (75%) (or, sixty-six and two-thirds percent (66
2/3%) if the Insurer used to provide the annuity does not offer a joint and
seventy-five percent (75%) annuity), or one hundred percent (100%) of the rate
at which such benefits were payable to the Participant. Unless otherwise elected
in the Adoption Agreement, a joint and fifty percent (50%) survivor annuity
shall be considered the designated qualified Joint and Survivor Annuity and the
normal form of payment for the purposes of this Plan. However, the Participant
may, without spousal consent, elect an alternative Joint and Survivor Annuity,
which alternative shall be equal in value to the designated qualified Joint and
Survivor Annuity. An unmarried Participant shall receive the value of such
Participant’s benefit in the form of a life annuity. Such unmarried Participant,
however, may elect 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 fulfilling 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 (or in such other form as permitted by the IRS) during
the election period and be consented to in writing (or in such other form as
permitted by the IRS) 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 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). 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 such Participant’s spouse may be revoked by the Participant in writing (or in
such other form as permitted by the IRS) without the consent of the spouse at
any time during the election period. A revocation of a prior election shall
cause the Participant’s benefits to be distributed as a Joint and Survivor
Annuity. The number of revocations shall not be limited.

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

 

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
ninety (90) day period ending on the Annuity Starting Date.

 

 

 

 

 

 

(4) For purposes of this Section, spouse or surviving spouse means the spouse or
surviving spouse of the Participant, provided that a former spouse will be
treated as the spouse or surviving spouse and a current spouse will not be
treated as the spouse or surviving spouse to the extent provided under a
qualified domestic relations order as described in Code Section 414(p).

 

 

 

 

 

 

(5) With regard to the election, except as otherwise provided herein, the
Administrator shall provide to the Participant no less than thirty (30) days and
no more than ninety (90) days before the Annuity Starting Date a written (or
such other form as permitted by the IRS) explanation of:

 

 

 

 

 

 

 

(i) the terms and conditions of the Joint and Survivor Annuity,

 

 

 

 

 

 

 

(ii) the Participant’s right to make and the effect of an election to waive the
Joint and Survivor Annuity,

 

 

 

 

 

 

 

(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.

 

 

 

 

 

 

(6) Any distribution provided for in this Section made on or after December 31,
1996, may commence less than thirty (30) days after the notice required by Code
Section 417(a)(3) is given provided the following requirements are satisfied:

 

 

 

 

 

 

 

(i) the Administrator clearly informs the Participant that the Participant has a
right to a period of thirty (30) days after receiving the notice to consider
whether to waive the Joint and Survivor Annuity and to elect (with spousal
consent) a form of distribution other than a Joint and Survivor Annuity;

 

 

 

 

 

 

 

(ii) the Participant is permitted to revoke any affirmative distribution
election at least until the Annuity Starting Date or, if later, at any time
prior to the expiration of the seven (7) day period that begins the day after
the explanation of the Joint and Survivor Annuity is provided to the
Participant;

 

 

 

 

 

 

 

(iii) the Annuity Starting Date is after the time that the explanation of the
Joint and Survivor Annuity is provided to the Participant. However, the Annuity
Starting Date may be before the date that any affirmative distribution election
is made by the Participant and before the date that the distribution is
permitted to commence under (iv) below; and

 

 

 

 

 

 

 

(iv) distribution in accordance with the affirmative election does not commence
before the expiration of the seven (7) day period that begins the day after the
explanation of the Joint and Survivor Annuity is provided to the Participant.

 

 

 

 

 

          (b) In the event a married Participant duly elects pursuant to
paragraph (a)(2) above not to receive the 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 Beneficiary any amount to which the
Participant or Beneficiary 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 that is allocated to the
accounts of the Participant at the time of the distribution;

 

 

 

 

 

 

(2) Partial withdrawals;

 

 

 

 

 

 

(3) Payments over a period certain in monthly, quarterly, semiannual, or annual
cash installments. In order to provide such installment payments, the
Administrator may (A) segregate the aggregate amount thereof in a separate,
federally insured savings account, certificate of deposit in a bank or savings
and loan association, money market certificate or other liquid short-term
security or (B) purchase a nontransferable annuity contract for a term certain
(with no life contingencies) providing for such payment. The period over

 

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

 

which such payment is to be made shall not extend beyond the Participant’s life
expectancy (or the life expectancy of the Participant and the Participant’s
designated Beneficiary);

 

 

 

 

 

 

(4) 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 the Participant’s
designated Beneficiary) or the life expectancy of the Participant (or the life
expectancy of the Participant and the Participant’s designated Beneficiary).

 

 

 

 

 

          (c) Benefits may not be paid without the Participant’s and the
Participant’s spouse’s consent if the present value of the Participant’s Joint
and Survivor Annuity derived from Employer and Employee contributions exceeds,
or has ever exceeded, $5,000 (or $3,500, for distributions made prior to the
later of the first day of the first Plan Year beginning after August 5, 1997, or
the date specified in the Adoption Agreement) and the benefit is “immediately
distributable.” However, spousal consent is not required if the distribution
will made in the form a Qualified Joint and Survivor Annuity and the benefit is
“immediately distributable.” A benefit is “immediately distributable” if any
part of the benefit could be distributed to the Participant (or surviving
spouse) before the Participant attains (or would have attained if not deceased)
the later of the Participant’s Normal Retirement Age or age 62.

 

 

 

 

 

          If the value of the Participant’s benefit derived from Employer and
Employee contributions does not exceed, and has never exceeded at the time of
any prior distribution, $5,000 (or, if applicable, $3,500), then the
Administrator will distribute such benefit in a lump-sum without such
Participant’s consent. No distribution may be made under the preceding sentence
after the Annuity Starting Date unless the Participant and the Participant’s
spouse consent in writing (or in such other form as permitted by the IRS) to
such distribution. Any consent required under this paragraph must be obtained
not more than ninety (90) days before commencement of the distribution and shall
be made in a manner consistent with Section 6.5(a)(2). Notwithstanding the
preceding, the “lookback rule” (which provides that if the present value at the
time of a prior distribution exceeded the applicable dollar threshold, then the
present value at any subsequent time is deemed to exceed the threshold) will not
apply to any distributions made on or after October 17, 2000.

 

 

 

 

 

          (d) The following rules will apply with respect to the consent
requirements set forth in subsection (c):

 

 

 

 

 

 

(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 the 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 that
are required under Section 6.5(e);

 

 

 

 

 

 

(3) Notice of the rights specified under this paragraph shall be provided no
less than thirty (30) days and no more than ninety (90) days before the Annuity
Starting Date;

 

 

 

 

 

 

(4) Written (or such other form as permitted by the IRS) consent of the
Participant to the distribution must not be made before the Participant receives
the notice and must not be made more than ninety (90) days before the Annuity
Starting Date; and

 

 

 

 

 

 

(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, for
Plan Years beginning after December 31, 1996, the distribution of a
Participant’s benefits, 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 1.401(a)(9)-2):

 

 

 

 

 

 

(1) A Participant’s benefits will be distributed or must begin to be distributed
not later than the Participant’s “required beginning date.” Alternatively,
distributions to a Participant must begin no later than the Participant’s
“required beginning date” and must be made over the life of the Participant (or
the lives of the Participant and the Participant’s designated Beneficiary) or
the life expectancy of the Participant (or the life expectancies of the
Participant and the Participant’s designated Beneficiary) in accordance with
Regulations. However, if the distribution is to be in the form of a joint and
survivor annuity or single life annuity, then distributions must begin no later
than the “required beginning date” and must be made over the life of the
Participant (or the lives of the Participant and the Participant’s designated
Beneficiary) in accordance with Regulations.

 

 

 

 

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(2) The “required beginning date” for a Participant who is a “five percent (5%)
owner” with respect to the Plan Year ending in the calendar year in which such
Participant attains age 70 1/2 means April 1st of the calendar year following
the calendar year in which the Participant attains age 70 1/2. Once
distributions have begun to a “five percent (5%) owner” under this subsection,
they must continue to be distributed, even if the Participant ceases to be a
“five percent (5%) owner” in a subsequent year.

 

 

 

 

 

(3) The “required beginning date” for a Participant other than a “five percent
(5%) owner” means, unless the Employer has elected to continue the pre-SBJPA
rules in the Adoption Agreement, April 1st of the calendar year following the
later of the calendar year in which the Participant attains age 70 1/2 or the
calendar year in which the Participant retires.

 

 

 

 

 

(4) If the election is made to continue the pre-SBJPA rules, then except as
provided below, the “required beginning date” is April 1st of the calendar year
following the calendar year in which a Participant attains age 70 1/2.

 

 

 

 

 

 

(i) However, the “required beginning date” for a Participant who had attained
age 70 1/2 before January 1, 1988, and was not a five percent (5%) owner (within
the meaning of Code Section 416) 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, is April 1st of the calendar year following the calendar
in which the Participant retires.

 

 

 

 

 

 

 

(ii) Notwithstanding (i) above, the “required beginning date” for a Participant
who was a five percent (5%) owner (within the meaning of Code Section 416) at
any time during the five (5) Plan Year period ending in the calendar year in
which the Participant attained age 70 1/2 is April 1st of the calendar year in
which the Participant attained age 70 1/2. In the case of a Participant who
became a five percent (5%) owner during any Plan Year after the calendar year in
which the Participant attained age 70 1/2, the “required beginning date” is
April 1st of the calendar year following the calendar year in which such
subsequent Plan Year ends.

 

 

 

 

 

 

(5) If this is an amendment or restatement of a plan that contained the
pre-SBJPA rules and an election is made to use the post-SBJPA rules, then the
transition rules elected in the Adoption Agreement will apply.

 

 

 

 

 

(6) Except as otherwise provided herein, “five percent (5%) owner” means, for
purposes of this Section, a Participant who is a five percent (5%) owner as
defined in Code Section 416 at any time during the Plan Year ending with or
within the calendar year in which such owner attains age 70 1/2.

 

 

 

 

 

(7) Distributions to a Participant and such Participant’s Beneficiaries will
only be made in accordance with the incidental death benefit requirements of
Code Section 401(a)(9)(G) and the Regulations thereunder.

 

 

 

 

 

(8) For purposes of this Section, the life expectancy of a Participant and/or a
Participant’s spouse (other than in the case of a life annuity) shall or shall
not be redetermined annually as elected 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 life expectancy shall be computed
using the return multiples in Tables V and VI of Regulation Section 1.72-9.

 

 

 

 

 

(9) With respect to distributions under the Plan made for calendar years
beginning on or after January 1, 2001, or if later, the date specified in the
Adoption Agreement, the Plan will apply the minimum distribution requirements of
Code Section 401(a)(9) in accordance with the Regulations under section
401(a)(9) that were proposed on January 17, 2001, notwithstanding any provision
of the Plan to the contrary. This amendment shall continue in effect until the
end of the last calendar year beginning before the effective date of final
Regulations under section 401(a)(9) or such other date as may be specified in
guidance published by the Internal Revenue Service.

 

 

 

 

 

However, if the date specified in the Adoption Agreement is a date in 2001 other
than January 1, 2001, then with respect to distributions under the Plan made on
or after such date for calendar years beginning on or after January 1, 2001, the
Plan will apply the minimum distribution requirements of Code Section 401(a)(9)
in accordance with the Regulations under section 401(a)(9) that were proposed on
January 17, 2001, notwithstanding any provision of the Plan to the contrary. If
the total amount of required minimum distributions made to a participant for
2001 prior to the specified date are equal to or greater than the amount of
required minimum distributions determined under the 2001 Proposed Regulations,
then no additional distributions are required for such participant for 2001 on
or after such date. If the total amount of required minimum distributions made
to a participant for 2001 prior to the specified date are less than the amount

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

determined under the 2001 Proposed Regulations, then the amount of required
minimum distributions for 2001 on or after such date will be determined so that
the total amount of required minimum distributions for 2001 is the amount
determined under the 2001 Proposed Regulations. This amendment shall continue in
effect until the end of the last calendar year beginning before the effective
date of final Regulations under section 401(a)(9) or such other date as may be
specified in guidance published by the Internal Revenue Service.

 

 

 

 

          (f) 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.

 

 

 

          (g) 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 retirement 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
(TEFRA).

 

 

 

          (h) If a distribution is made to a Participant who has not severed
employment and who is not fully Vested in the Participant’s Account, and the
Participant may increase the Vested percentage in such account, then at any
relevant time the Participant’s Vested portion of the account will be equal to
an amount (“X”) determined by the formula:

 

 

X equals P (AB plus D) - 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 the relevant time is the time at which,
under the Plan, the Vested percentage in the account cannot increase.

 

 

 

                    However, the Employer may attach an addendum to the Adoption
Agreement to provide that a separate account shall be established for the
Participant’s interest in the Plan as of the time of the distribution, and at
any relevant time the Participant’s Vested portion of the separate account will
be equal to an amount determined as follows: P (AB plus (R x D)) - (R x D) where
R is the ratio of the account balance at the relevant time to the account
balance after distribution and the other terms have the same meaning as in the
preceding paragraph. Any amendment to change the formula in accordance with the
preceding sentence shall not be considered an amendment which causes this Plan
to become an individually designed Plan.

 

 

 

          (i) If this is a Plan amendment that eliminates or restricts the
ability of a Participant to receive payment of the Participant’s interest in the
Plan under a particular optional form of benefit, then the amendment shall not
apply to any distribution with an annuity starting date earlier than the earlier
of: (i) the 90th day after the date the Participant receiving the distribution
has been furnished a summary that reflects the amendment and that satisfies the
Act requirements at 29 CFR 2520.104b-3 relating to a summary of material
modifications or (ii) the first day of the second Plan Year following the Plan
Year in which the amendment is adopted.

 

 

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 the surviving spouse. The
Participant’s spouse may direct that payment of the Pre-Retirement Survivor
Annuity commence within a reasonable period 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 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 (or in such
other form as permitted by the IRS) 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 nonspouse
Beneficiary. Notwithstanding the foregoing, the nonspouse 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 (or such other form as permitted
by the IRS) 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 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.

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

          (d) With regard to the election, the Administrator shall provide each
Participant within the applicable election period, with respect to such
Participant (and consistent with Regulations), a written (or such other form as
permitted by the IRS) explanation of the Pre-Retirement Survivor Annuity
containing comparable information to that required pursuant to Section
6.5(a)(5). 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;

 

 

 

 

 

(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; or

 

 

 

 

 

(4) A reasonable period ending after Code Section 401(a)(11) applies to the
Participant.

 

 

 

 

                    For purposes of applying this subsection, a reasonable
period ending after the enumerated events described in (2), (3) and (4) is the
end of the two (2) year period beginning one (1) year prior to the date the
applicable event occurs, and ending one (1) year after that date. In the case of
a Participant who separates from service before the Plan Year in which age 35 is
attained, notice shall be provided within the two (2) year period beginning one
(1) year prior to separation and ending one (1) year after separation. If such a
Participant thereafter returns to employment with the Employer, the applicable
period for such Participant shall be redetermined.

 

 

 

          (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(e)(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, and has never exceeded at
the time of any prior distribution, $5,000 (or, $3,500 for distributions made
prior to the later of the first day of the first Plan Year beginning after
August 5, 1997, or the date specified in the Adoption Agreement) the
Administrator shall direct the distribution of such amount to the Participant’s
spouse as soon as practicable. No distribution may be made under the preceding
sentence after the Annuity Starting Date unless the spouse consents in writing
(or in such other form as permitted by the IRS). If the value exceeds, or has
ever exceeded at the time of any prior distribution, $5,000 (or, if applicable,
$3,500), an immediate distribution of the entire amount may be made to the
surviving spouse, provided such surviving spouse consents in writing (or in such
other form as permitted by the IRS) to such distribution. Any consent required
under this paragraph must be obtained not more than ninety (90) days before
commencement of the distribution and shall be made in a manner consistent with
Section 6.5(a)(2). Notwithstanding the preceding, the “lookback rule” (which
provides that if the present value at the time of a prior distribution exceeded
the applicable dollar threshold, then the present value at any subsequent time
is deemed to exceed the threshold) will not apply to any distributions made on
or after October 17, 2000.

 

 

 

          (g) Death benefits may be paid to a Participant’s Beneficiary in one
of the following optional forms of benefits subject to the rules specified in
Section 6.6(h) and the elections made in the Adoption Agreement. Such optional
forms of distributions may be elected by the Participant in the event there is
an election to waive the Pre-Retirement Survivor Annuity, and for any death
benefits in excess of the Pre-Retirement Survivor Annuity. However, if no
optional form of distribution was elected by the Participant prior to death,
then the Participant’s Beneficiary may elect the form of distribution:

 

 

 

 

(1) One lump-sum payment in cash or in property that is allocated to the
accounts of the Participant at the time of the distribution.

 

 

 

 

 

(2) Partial withdrawals.

 

 

 

 

 

(3) Payment in monthly, quarterly, semi-annual, or annual cash installments over
a period to be determined by the Participant or the Participant’s Beneficiary.
In order to provide such installment payments, the Administrator may (A)
segregate the aggregate amount thereof in a separate, federally insured savings
account, certificate of deposit in a bank or savings and loan association, money
market certificate or other liquid short-term security or (B) purchase a
nontransferable annuity contract for a term certain (with no life contingencies)
providing for such payment. 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.

 

 

 

 

 

(4) In the form of an annuity over the life expectancy of the Beneficiary.

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

 

(5) 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 (1), (2) or
(3) above, or used to purchase an annuity so as to increase the payments made
pursuant to the Pre-Retirement Survivor Annuity.

 

 

 

 

          (h) Notwithstanding any provision in the Plan to the contrary,
distributions upon the death of a Participant 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 the entire
interest has been distributed, the remaining portion of such interest shall be
distributed at least as rapidly as under the method of distribution elected
pursuant to Section 6.5 as of the date of death.

 

 

 

 

 

(2) If a Participant dies before receiving any distributions of the interest in
the Plan or before distributions are deemed to have begun pursuant to
Regulations, then the death benefit shall be distributed to the Participant’s
Beneficiaries in accordance with the following rules subject to the elections
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 (or such
later date as may be prescribed by Regulations);

 

 

 

 

 

 

 

(iii) However, in the event the Participant’s spouse (determined as of the date
of the Participant’s death) is the 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-year distribution requirement of this Section
shall apply as if the spouse was the Participant.

 

 

 

 

 

 

(3) Notwithstanding subparagraph (2) above, or any elections 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, December 31st of 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
(or in such other form as permitted by the IRS) 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 redetermined annually as elected in the Adoption Agreement and in
accordance with Regulations. If the Participant 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 life expectancy shall be computed using the return multiples in Tables
V and VI of Regulation Section 1.72-9.

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

          (k) For purposes of this Section, any amount paid to a child of the
Participant will be treated as if it had been paid to the surviving spouse if
the amount becomes payable to the surviving spouse when the child reaches the
age of majority.

 

 

 

          (l) In the event that less than one hundred percent (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.

 

 

 

          (m) 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 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
(TEFRA).

 

 

6.7 TIME OF 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, the
distribution or series of payments may be made or begun on such date or as soon
thereafter as is practicable. 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 sixtieth (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 tenth (10th) anniversary of the year in which the Participant commenced
participation in the Plan; or (c) the date the Participant terminates service
with the Employer.

 

                    Notwithstanding the foregoing, the failure of a Participant
and, if applicable, the Participant’s spouse, to consent to a distribution that
is “immediately distributable” (within the meaning of 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 OR INCOMPETENT BENEFICIARY

 

 

                    In the event a distribution is to be made to a minor or
incompetent Beneficiary, then the Administrator may direct that such
distribution be paid to the legal guardian, or if none in the case of a minor
Beneficiary, to a parent of such Beneficiary, 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 or incompetent
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 Beneficiary hereunder shall, at the later of the
Participant’s attainment of age 62 or 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 Beneficiary, the amount so distributable shall be treated as a Forfeiture
pursuant to the Plan. Notwithstanding the foregoing, if the value of a
Participant’s Vested benefit derived from Employer and Employee contributions
does not exceed $5,000, then the amount distributable may be treated as a
Forfeiture at the time it is determined that the whereabouts of the Participant
or the Participant’s Beneficiary can not be ascertained. In the event a
Participant or Beneficiary is located subsequent to the Forfeiture, such benefit
shall be restored, first from Forfeitures, if any, and then from an additional
Employer contribution, if necessary. Upon Plan termination, the portion of the
distributable amount that is an “eligible rollover distribution” as defined in
Plan Section 6.14(b)(1) may be paid directly to an individual retirement account
described in Code Section 408(a) or an individual retirement annuity described
in Code Section 408(b). However, regardless of the preceding, a benefit that is
lost by reason of escheat under applicable state law is not treated as a
Forfeiture for purposes of this Section nor as an impermissible forfeiture under
the Code.

 

6.10 IN-SERVICE DISTRIBUTION

 

                    For Profit Sharing Plans and 401(k) Profit Sharing Plans, if
elected in the Adoption Agreement, at such time as the conditions set forth in
the Adoption Agreement have been satisfied, then the Administrator, at the
election of a Participant who has not severed employment with the Employer,
shall direct the distribution of up to the entire Vested amount then credited to
the accounts as elected in the Adoption Agreement maintained on behalf of such
Participant. 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. Furthermore, if an in-service distribution
is permitted from more than one account type, the Administrator may determine
any ordering of a Participant’s in-service distribution from such accounts.

 

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6.11 ADVANCE DISTRIBUTION FOR HARDSHIP

 

 

          (a) For Profit Sharing Plans and 401(k) Plans (except to the extent
Section 12.9 applies), 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 the Vested interest
of the Participant’s Combined Account valued as of the last 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 for an immediate and heavy
financial need. The Administrator will determine whether there is an immediate
and heavy financial need based on the facts and circumstances. An immediate and
heavy financial need includes, but is not limited to, a distribution for one of
the following:

 

 

 

 

(1) Medical expenses described in Code Section 213(d) incurred by the
Participant, the Participant’s spouse, or any of the Participant’s dependents
(as defined in Code Section 152) or necessary for these persons to obtain
medical care as described in Code Section 213(d);

 

 

 

 

 

(2) Costs directly related to 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, related educational fees, and room and board expenses,
for the next twelve (12) months of post-secondary education for the Participant,
the Participant’s spouse, children, or dependents (as defined in Code Section
152); or

 

 

 

 

 

(5) Payments necessary to prevent the eviction of the Participant from the
Participant’s principal residence or foreclosure on the mortgage on that
residence.

 

 

 

 

          (b) If elected in the Adoption Agreement, no distribution shall be
made pursuant to this Section from the Participant’s Account until such Account
has become fully Vested. Furthermore, if a hardship distribution is permitted
from more than one account type, the Administrator may determine any ordering of
a Participant’s hardship distribution from such accounts.

 

 

 

          (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 SPECIAL RULE FOR CERTAIN PROFIT SHARING PLANS

 

 

          (a) The provisions of this Section apply to a Participant in a Profit
Sharing Plan or 401(k) Profit Sharing Plan to the extent elected in the Adoption
Agreement.

 

 

 

          (b) If an election is made to not offer life annuities as a form of
distribution, then a Participant shall be prohibited from electing benefits in
the form of a life annuity and the Joint and Survivor Annuity provisions of
Section 6.5 shall not apply.

 

 

 

          (c) Notwithstanding anything in Sections 6.2 and 6.6 to the contrary,
upon the death of a Participant, the automatic form of distribution will be a
lump-sum rather than a Qualified Pre-Retirement Survivor Annuity. Furthermore,
the Participant’s spouse will be the Beneficiary of the Participant’s entire
Vested interest in the Plan unless an election is made to waive the spouse as
Beneficiary. The other provisions in Section 6.2 shall be applied by treating
the death benefit in this subsection as though it is a Qualified Pre-Retirement
Survivor Annuity.

 

 

 

          (d) Except to the extent otherwise provided in this Section, the
provisions of Sections 6.2, 6.5 and 6.6 regarding spousal consent shall be
inoperative with respect to this Plan.

 

 

 

          (e) If a distribution is one to which Code Sections 401(a)(11) and 417
do not apply, such distribution may commence less than thirty (30) days after
the notice required under Regulation 1.411(a)-11(c) is given, provided that:

 

 

 

 

(1) the Plan Administrator clearly informs the Participant that the Participant
has a right to a period of at least thirty (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.

 

 

 

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6.13 QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION

 

                    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 meanings set forth under
Code Section 414(p).

 

6.14 DIRECT ROLLOVERS

 

 

          (a) Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a “distributee’s” election under this Section, a
“distributee” may elect, at the time and in the manner prescribed by the
Administrator, to have any portion of an “eligible rollover distribution” that
is equal to at least $500 paid directly to an “eligible retirement plan”
specified by the “distributee” in a “direct rollover.”

 

 

 

          (b) For purposes of this Section, the following definitions shall
apply:

 

 

 

 

(1) An “eligible rollover distribution” means any distribution described in Code
Section 402(c)(4) and generally includes any distribution of all or any portion
of the balance to the credit of the distributee, except that an “eligible
rollover distribution” does not include: any distribution that is one of a
series of substantially equal periodic payments (not less frequently than
annually) made for the life (or life expectancy) of the “distributee” or the
joint lives (or joint life expectancies) of the “distributee” and the
“distributee’s” designated beneficiary, or for a specified period of ten (10)
years or more; any distribution to the extent such distribution is required
under Code Section 401(a)(9); the portion of any other distribution(s) that is
not includible in gross income (determined without regard to the exclusion for
net unrealized appreciation with respect to employer securities); for
distributions made after December 31, 1998, any hardship distribution described
in Code Section 401(k)(2)(B)(i)(IV); and any other distribution reasonably
expected to total less than $200 during a year.

 

 

 

 

 

(2) An “eligible retirement plan” is an individual retirement account described
in Code Section 408(a), an individual retirement annuity described in Code
Section 408(b), an annuity plan described in Code Section 403(a), or a qualified
plan described in Code Section 401(a), that accepts the “distributee’s”
“eligible rollover distribution.” However, in the case of an “eligible rollover
distribution” to the surviving spouse, an “eligible retirement plan” is an
individual retirement account or individual retirement annuity.

 

 

 

 

 

(3) A “distributee” includes an Employee or former Employee. In addition, the
Employee’s or former Employee’s surviving spouse and the Employee’s or former
Employee’s spouse or former spouse who is the alternate payee under a qualified
domestic relations order, as defined in Code Section 414(p), are distributees
with regard to the interest of the spouse or former spouse.

 

 

 

 

 

(4) A “direct rollover” is a payment by the Plan to the “eligible retirement
plan” specified by the “distributee.”

 

 

 

6.15 TRANSFER OF ASSETS FROM A MONEY PURCHASE PLAN

 

 

          (a) This Section shall be effective as of the following date:

 

 

 

 

(1) for Plans not entitled to extended reliance as described in Revenue Ruling
94-76, the first day of the first Plan Year beginning on or after December 12,
1994, or if later, 90 days after December 12, 1994; or

 

 

 

 

 

(2) for Plans entitled to extended reliance as described in Revenue Ruling
94-76, as of the first day of the first Plan Year following the Plan Year in
which the extended reliance period applicable to the Plan ends. 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.

 

 

 

 

          (b) 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 Code Section 414(l), to this Plan from a money purchase pension plan
qualified under Code Section 401(a) (other than any portion of those assets and
liabilities attributable to after-tax voluntary Employee contributions or to a
direct or indirect rollover contribution).

 

 

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6.16 ELECTIVE TRANSFERS OF BENEFITS TO OTHER PLANS

 

 

          (a) If a voluntary, fully-informed election is made by a Participant,
then if the conditions set forth herein are satisfied, a Participant’s entire
benefit may be transferred between qualified plans (other than any direct
rollover described in Q&A-3 of Regulation 1.401(a)(31)-1). As an alternative to
the transfer, the Participant may elect to retain the Participant’s “Section
411(d)(6) protected benefits” under the Plan (or, if the plan is terminating, to
receive any optional form of benefit for which the Participant is eligible under
the plan as required by Code Section 411(d)(6)). A transfer between qualified
plans may only be made pursuant to this subsection if the following additional
requirements are met:

 

 

 

 

(i) The transfer occurs at a time at which the participant’s benefits are
distributable. A Participant’s benefits are distributable on a particular date
if, on that date, the Participant is eligible, under the terms of the Plan, to
receive an immediate distribution of these benefits (e.g., in the form of an
immediately commencing annuity) from that plan under provisions of the plan not
inconsistent with Code Section 401(a);

 

 

 

 

 

(ii) For transfers that occur on or after January 1, 2002, the transfer occurs
at a time at which the Participant is not eligible to receive an immediate
distribution of the participant’s entire nonforfeitable accrued benefit in a
single-sum distribution that would consist entirely of an eligible rollover
distribution within the meaning of Code Section 401(a)(31)(C);

 

 

 

 

 

(iii) The participant is fully Vested in the transferred benefit in the
transferee plan;

 

 

 

 

 

(iv) In the case of a transfer from a defined contribution plan to a defined
benefit plan, the defined benefit plan provides a minimum benefit, for each
Participant whose benefits are transferred, equal to the benefit, expressed as
an annuity payable at normal retirement age, that is derived solely on the basis
of the amount transferred with respect to such Participant; and

 

 

 

 

 

(v) The amount of the benefit transferred, together with the amount of any
contemporaneous Code Section 401(a)(31) direct rollover to the transferee plan,
equals the Participant’s entire nonforfeitable accrued benefit under the Plan.

 

 

 

 

          (b) If a voluntary, fully-informed election is made by a Participant,
then if the conditions set forth herein are satisfied, a Participant’s entire
benefit may be transferred between qualified defined contribution plans (other
than any direct rollover described in Q&A-3 of Regulation 1.401(a)(31)-1). As an
alternative to the transfer, the Participant may elect to retain the
Participant’s “Section 411(d)(6) protected benefits” under the Plan (or, if the
plan is terminating, to receive any optional form of benefit for which the
Participant is eligible under the plan as required by Code Section 411(d)(6)). A
transfer between qualified plans may only be made pursuant to this subsection if
the following additional requirements are met:

 

 

 

 

(i) To the extent the benefits are transferred from a money purchase pension
plan, the transferee plan must be a money purchase pension plan. To the extent
the benefits being transferred are part of a qualified cash or deferred
arrangement under Code Section 401(k), the benefits must be transferred to a
qualified cash or deferred arrangement under Code Section 401(k). Benefits
transferred from a profit-sharing plan other than from a qualified cash or
deferred arrangement, or from a stock bonus plan other than an employee stock
ownership plan, may be transferred to any type of defined contribution plan; and

 

 

 

 

 

(ii) The transfer must be made either in connection with an asset or stock
acquisition, merger, or other similar transaction involving a change in employer
of the employees of a trade or business (i.e., an acquisition or disposition
within the meaning of Regulation 1.410(b)-2(f)) or in connection with the
Participant’s change in employment status to an employment status with respect
to which the Participant is not entitled to additional allocations under the
Plan.

 

 

 

ARTICLE VII
TRUSTEE AND CUSTODIAN

 

7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE

 

 

          (a) The provisions of this Article, other than Section 7.6, shall not
apply to this Plan if a separate trust agreement is being used as specified in
the Adoption Agreement.

 

 

 

          (b) The Trustee is accountable to the Employer for the funds
contributed to the Plan by the Employer, but the Trustee does not have any duty
to see that the contributions received comply with the provisions of the Plan.

 

 

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The Trustee is not obligated to collect any contributions from the Employer, nor
is it under a duty to see that funds deposited with it are deposited in
accordance with the provisions of the Plan.

 

 

 

          (c) The Trustee will credit and distribute the Trust Fund as directed
by the Administrator. The Trustee is not obligated to inquire as to whether any
payee or distributee is entitled to any payment or whether the distribution is
proper or within the terms of the Plan, or whether the manner of making any
payment or distribution is proper. The Trustee is accountable only to the
Administrator for any payment or distribution made by it in good faith on the
order or direction of the Administrator.

 

 

 

          (d) In the event that the Trustee shall be directed by a Participant
(pursuant to the Participant Direction Procedures if the Plan permits
Participant directed investments), the Employer, or an Investment Manager or
other agent appointed by the Employer with respect to the investment of any or
all Plan assets, the Trustee shall have no liability with respect to the
investment of such assets, but shall be responsible only to execute such
investment instructions as so directed.

 

 

 

 

(1) The Trustee shall be entitled to rely fully on the written (or other form
acceptable to the Administrator and the Trustee, including but not limited to,
voice recorded) instructions of a Participant (pursuant to the Participant
Direction Procedures), the Employer, or any Fiduciary or nonfiduciary agent of
the Employer, in the discharge of such duties, and shall not be liable for any
loss or other liability resulting from such direction (or lack of direction) of
the investment of any part of the Plan assets.

 

 

 

 

 

(2) The Trustee may delegate the duty of executing such instructions to any
nonfiduciary agent, which may be an affiliate of the Trustee or any Plan
representative.

 

 

 

 

 

(3) 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 direction
improper by virtue of applicable law. The Trustee shall not be responsible or
liable for any loss or expense that may result from the Trustee’s refusal or
failure to comply with any direction from the Participant.

 

 

 

 

 

(4) Any costs and expenses related to compliance with the Participant’s
directions shall be borne by the Participant’s Directed Account, unless paid by
the Employer.

 

 

 

 

 

(5) Notwithstanding anything herein above to the contrary, the Trustee shall not
invest any portion of a Participant’s Directed Account in “collectibles” within
the meaning of Code Section 408(m).

 

 

 

 

          (e) The Trustee will maintain records of receipts and disbursements
and furnish to the Employer and/or Administrator for each Plan Year a written
annual report pursuant to Section 7.9.

 

 

 

          (f) 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.

 

 

 

          (g) The Trustee may employ and pay from the Trust Fund reasonable
compensation to agents, attorneys, accountants and other persons to advise the
Trustee as in its opinion may be necessary. The Trustee may delegate to any
agent, attorney, accountant or other person selected by it any non-Trustee power
or duty vested in it by the Plan, and the Trustee may act or refrain from acting
on the advice or opinion of any such person.

 

 

7.2 INVESTMENT POWERS AND DUTIES OF DISCRETIONARY TRUSTEE

 

 

          (a) This Section applies if the Employer, in the Adoption Agreement or
as otherwise agreed upon by the Employer and the Trustee, designates the Trustee
to administer all or a portion of the trust as a discretionary Trustee. If so
designated, then the Trustee has the discretion and authority to invest, manage,
and control those Plan assets except, however, with respect to those assets
which are subject to the investment direction of a Participant (if Participant
directed investments are permitted), or an Investment Manager, the
Administrator, or other agent appointed by the Employer. The exercise of any
investment discretion hereunder shall be consistent with the “funding policy and
method” determined by the Employer.

 

 

 

          (b) The Trustee shall, except as otherwise provided in this Plan,
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, common or preferred stocks, open-end or
closed-end mutual funds, 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

 

 

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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.

 

 

          (c) The Trustee, in addition to all powers and authorities under
common law, statutory 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:

 

 

 

 

(1) 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;

 

 

 

 

 

(2) 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;

 

 

 

 

 

(3) 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. However,
the Trustee shall not vote proxies relating to securities for which it has not
been assigned full investment management responsibilities. In those cases where
another party has such investment authority or discretion, the Trustee will
deliver all proxies to said party who will then have full responsibility for
voting those proxies;

 

 

 

 

 

(4) To cause any securities or other property to be registered in the Trustee’s
own name, in the name of one or more of the Trustee’s nominees, in a clearing
corporation, in a depository, or in book entry form or 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;

 

 

 

 

 

(5) To invest in a common, collective, or pooled trust fund (the provisions of
which are incorporated herein by reference) maintained by any Trustee (or any
affiliate of such Trustee) hereunder pursuant to Revenue Ruling 81-100, all or
such part of the Trust Fund as the Trustee may deem advisable, and the part 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 name of the trust fund may be specified in an addendum to the
Adoption Agreement. The Trustee may withdraw from such common, collective, or
pooled trust fund all or such part of the Trust Fund as the Trustee may deem
advisable;

 

 

 

 

 

(6) 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;

 

 

 

 

 

(7) 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;

 

 

 

 

 

(8) 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;

 

 

 

 

 

(9) 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;

 

 

 

 

 

(10) To employ suitable agents and counsel and to pay their reasonable expenses
and compensation, and such agents or counsel may or may not be an agent or
counsel for the Employer;

 

 

 

 

 

(11) To apply for and procure from the Insurer as an investment of the Trust
Fund any annuity or other Contracts (on the life of any Participant, or in the
case of a Profit Sharing Plan (including a 401(k) plan), on the life of any
person in whom a Participant has an insurable interest, or on the joint lives of
a Participant and any person in whom the Participant has an insurable interest)
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,

 

 

 

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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;

 

 

 

 

 

(12) To invest funds of the Trust in time deposits or savings accounts bearing a
reasonable rate of interest or in cash or cash balances without liability for
interest thereon, including the specific authority to invest in any type of
deposit of the Trustee (or of a financial institution related to the Trustee);

 

 

 

 

 

(13) To invest in Treasury Bills and other forms of United States government
obligations;

 

 

 

 

 

(14) 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 regardless of whether such options are covered;

 

 

 

 

 

(15) To deposit monies in federally insured savings accounts or certificates of
deposit in banks or savings and loan associations including the specific
authority to make deposit into any savings accounts or certificates of deposit
of the Trustee (or a financial institution related to the Trustee);

 

 

 

 

 

(16) 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 Trust
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; and

 

 

 

 

 

(17) 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.

 

 

 

7.3 INVESTMENT POWERS AND DUTIES OF NONDISCRETIONARY TRUSTEE

 

 

          (a) This Section applies if the Employer, in the Adoption Agreement or
as otherwise agreed upon by the Employer and the Trustee, designates the Trustee
to administer all or a portion of the trust as a nondiscretionary Trustee. If so
designated, then the Trustee shall have no discretionary authority to invest,
manage, or control those Plan assets, but must act solely as a directed Trustee
of those Plan assets. A nondiscretionary Trustee, as directed Trustee of the
Plan funds it holds, is authorized and empowered, by way of limitation, with the
powers, rights and duties set forth herein and in Section 7.14, each of which
the nondiscretionary Trustee exercises solely as directed Trustee in accordance
with the direction of the party which has the authority to manage and control
the investment of the Plan assets. If no directions are provided to the Trustee,
the Employer will provide necessary direction. Furthermore, the Employer and the
nondiscretionary Trustee may, in writing, limit the powers of the
nondiscretionary Trustee to any combination of powers listed within this
Section.

 

 

 

          (b) The Trustee, in addition to all powers and authorities under
common law, statutory authority, including the Act, and other provisions of this
Plan, shall have the following powers and authorities:

 

 

 

 

(1) To invest the assets, without distinction between principal and income, in
securities or property, real or personal, wherever situated, including, but not
limited to, common or preferred stocks, open-end or closed-end mutual funds,
bonds and other evidences of indebtedness or ownership, and real estate or any
interest therein. 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.

 

 

 

 

 

(2) 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;

 

 

 

 

 

(3) 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;

 

 

 

 

 

(4) At the direction of the party which has the authority or discretion, 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 powers, and pay any assessments or charges in

 

 

 

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connection therewith; and generally to exercise any of the powers of an owner
with respect to stocks, bonds, securities, or other property;

 

 

 

 

 

(5) To cause any securities or other property to be registered in the Trustee’s
own name, in the name of one or more of the Trustee’s nominees, in a clearing
corporation, in a depository, or in book entry form or 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;

 

 

 

 

 

(6) To invest in a common, collective, or pooled trust fund (the provisions of
which are incorporated herein by reference) maintained by any Trustee (or any
affiliate of such Trustee) hereunder pursuant to Revenue Ruling 81-100, all or
such part of the Trust Fund as the party which has the authority to manage and
control the investment of the assets shall deem advisable, and the part 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 name of the trust fund may be specified in an addendum to the Adoption
Agreement;

 

 

 

 

 

(7) 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;

 

 

 

 

 

(8) 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;

 

 

 

 

 

(9) 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;

 

 

 

 

 

(10) To employ suitable agents and counsel and to pay their reasonable expenses
and compensation, and such agent or counsel may or may not be an agent or
counsel for the Employer;

 

 

 

 

 

(11) To apply for and procure from the Insurer as an investment of the Trust
Fund any annuity or other Contracts (on the life of any Participant, or in the
case of a Profit Sharing Plan (including a 401(k) plan), on the life of any
person in whom a Participant has an insurable interest, or on the joint lives of
a Participant and any person in whom the Participant has an insurable interest)
as the Administrator shall deem proper; to exercise, at the direction of the
person with the authority to do so, 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;

 

 

 

 

 

(12) To invest funds of the Trust in time deposits or savings accounts bearing a
reasonable rate of interest or in cash or cash balances without liability for
interest thereon, including the specific authority to invest in any type of
deposit of the Trustee (or of a financial institution related to the Trustee);

 

 

 

 

 

(13) To invest in Treasury Bills and other forms of United States government
obligations;

 

 

 

 

 

(14) 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 regardless of whether such options are covered;

 

 

 

 

 

(15) To deposit monies in federally insured savings accounts or certificates of
deposit in banks or savings and loan associations including the specific
authority to make deposit into any savings accounts or certificates of deposit
of the Trustee (or a financial institution related to the Trustee); and

 

 

 

 

 

(16) 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.

 

 

 

7.4 POWERS AND DUTIES OF CUSTODIAN

 

 

 

                    If there is a discretionary Trustee, the Employer may
appoint a custodian. A custodian has the same powers, rights and duties as a
nondiscretionary Trustee. Any reference in the Plan to a Trustee also is a
reference to a custodian unless the

 

 

 

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context of the Plan indicates otherwise. A limitation of the Trustee’s liability
by Plan provision also acts as a limitation of the custodian’s liability. Any
action taken by the custodian at the discretionary Trustee’s direction satisfies
any provision in the Plan referring to the Trustee taking that action. The
resignation or removal of the custodian shall be made in accordance with Section
7.11 as though the custodian were a Trustee.

 

 

7.5 LIFE INSURANCE

 

 

 

          (a) 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 or, in the case of Profit Sharing Plan (including a 401(k) plan),
on the life of any person in whom the Participant has an insurable interest or
on the joint lives of a Participant and any person in whom the Participant has
an insurable interest. 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 or
Former Participant, then the aggregate premium for ordinary life insurance for
each Participant or Former Participant must be less than 50% of the aggregate
contributions and Forfeitures allocated to the Participant’s or Former
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, then the aggregate premium must be 25% or less of the aggregate
contributions and Forfeitures allocated to the Participant’s or Former
Participant’s Combined Account. If both term insurance and ordinary life
insurance are purchased, then the premium 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 the
Participant’s or Former Participant’s Combined Account. Notwithstanding the
preceding, the limitations imposed herein with respect to the purchase of life
insurance shall not apply, in the case of a Profit Sharing Plan (including a
401(k) plan), to the portion of the Participant’s Account that has accumulated
for at least two (2) Plan Years or to the entire Participant’s Account if the
Participant has been a Participant in the Plan for at least five (5) years.
Amounts transferred to this Plan in accordance with Section 4.6(e)(ii), (iii) or
(v) and a Participant’s or Former Participant’s Voluntary Contribution Account
may be used to purchase Contracts without limitation.

 

 

 

          (b) The Trustee must distribute the Contracts to the Participant or
Former 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 commencement of
benefits. Furthermore, if a Contract is purchased on the joint lives of the
Participant and another person and such other person predeceases the
Participant, then the Contract may not be maintained under this Plan.

 

 

 

          (c) Notwithstanding anything herein above 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. Furthermore, no life insurance Contracts shall be required to be
obtained on an individual’s life if, for any reason (other than the nonpayment
of premiums) the Insurer will not issue a Contract on such individual’s life.

 

 

 

          (d) 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 that are in excess of the cash surrender value
immediately prior to death. However, the Trustee shall not pay the proceeds in a
method that would violate the requirements of the Retirement Equity Act of 1984,
as stated in Article VI of the Plan, or Code Section 401(a)(9) and the
Regulations thereunder. 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.

 

 

7.6 LOANS TO PARTICIPANTS

 

 

 

          (a) If specified in the Adoption Agreement, the Trustee (or the
Administrator if the Trustee is a nondiscretionary Trustee or if loans are
treated as Participant directed investments pursuant to the Adoption Agreement)
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) loans shall provide for periodic
repayment over a reasonable period of time. Furthermore, no Participant loan
shall exceed the Participant’s Vested interest in the Plan.

 

 

 

          (b) Loans shall not be made to any Shareholder-Employee or
Owner-Employee (including an Owner-Employee’s family members as defined in Code
Section 267(c)(4)) unless an exemption for such loan is obtained

 

 

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pursuant to Act Section 408 or such loan would otherwise not be a prohibited
transaction pursuant to Code Section 4975 and Act Section 408.

 

 

 

 

          (c) 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.

 

 

 

 

          (d) If the Vested interest of a Participant is used to secure any loan
made pursuant to this Section, then the written (or such other form as permitted
by the IRS) consent of the Participant’s spouse shall be required in a manner
consistent with Section 6.5(a), provided the spousal consent requirements of
such Section apply to the Plan. Such 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 or Former Participant
shall be taken into account in determining the amount of the death benefit or
Pre-Retirement Survivor Annuity. However, unless the loan program established
pursuant to this Section provides otherwise, no spousal consent shall be
required under this paragraph if the total interest subject to the security is
not in excess of $5,000 (or, $3,500 effective for loans made prior to the later
of the first day of the first Plan Year beginning after August 5, 1997, or the
date specified in the Adoption Agreement).

 

 

 

 

          (e) The Administrator shall be authorized to establish a participant
loan program to provide for loans under the Plan. The loan program shall be
established in accordance with Department of Labor Regulation Section
2550.408(b)-1(d)(2) providing for loans by the Plan to parties-in-interest under
said Plan, such as Participants or Beneficiaries. In order for the Administrator
to implement such loan program, a separate written document forming a part of
this Plan must be adopted, which document shall specifically 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;

 

 

 

 

 

(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 in the event such default.

 

 

 

 

          (f) Notwithstanding anything in this Plan to the contrary, if a
Participant or Beneficiary defaults on a loan made pursuant to this Section that
is secured by the Participant’s interest in the Plan, then a Participant’s
interest may be offset by the amount subject to the security to the extent there
is a distributable event permitted by the Code or Regulations.

 

 

 

 

          (g) Notwithstanding anything in this Section to the contrary, if this
is an amendment and restatement of an existing Plan, any loans made prior to the
date this amendment and restatement is adopted shall be subject to the terms of
the Plan in effect at the time such loan was made.

 

 

 

7.7 MAJORITY ACTIONS

 

 

 

                    Except where there has been an allocation and delegation of
powers, 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.

 

 

 

7.8 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. However, an
individual serving as Trustee who already receives full-time compensation from
the Employer shall not receive compensation from this 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 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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7.9 ANNUAL REPORT OF THE TRUSTEE

 

 

 

 

          (a) 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:

 

 

 

 

 

(1) the net income, or loss, of the Trust Fund;

 

 

 

 

 

(2) the gains, or losses, realized by the Trust Fund upon sales or other
disposition of the assets;

 

 

 

 

 

(3) the increase, or decrease, in the value of the Trust Fund;

 

 

 

 

 

(4) all payments and distributions made from the Trust Fund; and

 

 

 

 

 

(5) such further information as the Trustee and/or Administrator deems
appropriate.

 

 

 

 

          (b) The Employer, promptly 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 on the Employer and
the Trustee as to all matters contained in the statement 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. However, nothing contained in
this Section shall deprive the Trustee of its right to have its accounts
judicially settled if the Trustee so desires.

 

 

 

7.10 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 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 the audit setting forth the accountant’s 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 Employer, be paid from the Trust Fund.

 

 

 

 

          (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, supervised, and subject to periodic
examination by a state or federal agency, then it shall transmit and certify the
accuracy of that information to the Administrator as provided in Act Section
103(b) within one hundred 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.

 

 

 

7.11 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE

 

 

 

 

          (a) Unless otherwise agreed to by both the Trustee and the Employer, a
Trustee may resign at any time by delivering to the Employer, at least thirty
(30) days before its effective date, a written notice of resignation.

 

 

 

 

          (b) Unless otherwise agreed to by both the Trustee and the Employer,
the Employer may remove a Trustee at any time by delivering to the Trustee, at
least thirty (30) days before its effective date, a written notice of such
Trustee’s 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 powers and
responsibilities of the predecessor as if such successor had been originally
named as a Trustee herein. Until such a successor is appointed, any 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 powers and
responsibilities of the predecessor as if such successor had been originally
named as Trustee herein immediately upon the death, resignation, incapacity, or
removal of the predecessor.

 

 

 

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          (e) Whenever any Trustee hereunder ceases to serve as such, the
Trustee shall furnish to the Employer and Administrator a written statement of
account with respect to the portion of the Plan Year during which the individual
or entity 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 7.9
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 7.9
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 7.9 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 who
has rendered all statements of account required by Section 7.9 and this
subparagraph.

 

 

 

7.12 TRANSFER OF INTEREST

 

 

 

                    Notwithstanding any other provision contained in this Plan,
the Trustee at the direction of the Administrator shall transfer the interest,
if any, of a Participant to another trust forming part of a pension, profit
sharing, or stock bonus plan that meets the requirements of Code Section 401(a),
provided that the trust to which such transfers are made permits the transfer to
be made.

 

 

 

7.13 TRUSTEE INDEMNIFICATION

 

 

 

                    The Employer agrees to indemnify and hold 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.

 

 

 

7.14 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 one hundred percent
(100%), in the case of a Profit Sharing Plan or 401(k) Plan, or ten percent
(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.”

 

 

 

                    Notwithstanding the preceding, for Plan Years beginning
after December 31, 1998, if the Plan does not permit Participants to direct the
investment of their Participants’ Elective Deferral Accounts, then the Trustee
shall only be permitted to acquire or hold “qualifying Employer securities” and
“qualifying Employer real property” to the extent permitted under Act Section
407.

 

 

 

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 that affects
the rights, duties or responsibilities of the Trustee or Administrator may only
be made with the Trustee’s or 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 any addendum to the Adoption Agreement that is specifically
permitted pursuant to the terms of the Plan; (3) add overriding language to the
Adoption Agreement when such language is necessary to satisfy Code Sections 415
or 416 because of the required aggregation of multiple plans, and (4) 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 Prototype Plan and this Plan will be
considered to be an individually designed plan. Notwithstanding the preceding,
the attachment to the Adoption Agreement of any addendum specifically authorized
by the Plan or a list of any “Section 411(d)(6) protected benefits” which must
be preserved shall not be considered an amendment to the Plan.

 

 

 

 

          (c) The Employer expressly delegates authority to the sponsor of this
Prototype Plan, the right to amend each Employer’s Plan by submitting a copy of
the amendment to each Employer who has adopted this Prototype Plan, after first
having received a ruling or favorable determination from the Internal Revenue
Service that the Prototype Plan as amended qualifies under Code Section 401(a)
and the Act (unless a ruling or determination is not required by the IRS). For
purposes of this Section, the mass submitter shall be recognized as the agent of
the sponsor. If

 

 

 

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the sponsor does not adopt any amendment made by the mass submitter, it will no
longer be identical to, or a minor modifier of, the mass submitter plan.

 

 

 

 

          (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) or other IRS guidance, 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” which results in a further restriction on such
benefits unless such “Section 411(d)(6) 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. A Plan amendment that
eliminates or restricts the ability of a Participant to receive payment of the
Participant’s interest in the Plan under a particular optional form of benefit
will be permissible if the amendment satisfies the conditions in (1) and (2)
below:

 

 

 

 

 

(1) The amendment provides a single-sum distribution form that is otherwise
identical to the optional form of benefit eliminated or restricted. For purposes
of this condition (1), a single-sum distribution form is otherwise identical
only if it is identical in all respects to the eliminated or restricted optional
form of benefit (or would be identical except that it provides greater rights to
the Participant) except with respect to the timing of payments after
commencement.

 

 

 

 

 

(2) The amendment is not effective unless the amendment provides that the
amendment shall not apply to any distribution with an Annuity Starting Date
earlier than the earlier of: (i) the ninetieth (90th) day after the date the
Participant receiving the distribution has been furnished a summary that
reflects the amendment and that satisfies the Act requirements at 29 CFR
2520.104b-3 (relating to a summary of material modifications) or (ii) the first
day of the second Plan Year following the Plan Year in which the amendment is
adopted.

 

 

 

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, including
Forfeitures, 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 that 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(e).

 

 

 

8.3 MERGER, CONSOLIDATION OR TRANSFER OF ASSETS

 

 

 

                    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 transfer, merger or consolidation does not otherwise
result in the elimination or reduction of any “Section 411(d)(6) protected
benefits” as described in Section 8.1(e).

 

 

 

ARTICLE IX
TOP HEAVY PROVISIONS

 

 

 

9.1 TOP HEAVY PLAN REQUIREMENTS

 

 

 

                    Notwithstanding anything in this Plan to the contrary, 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(f) of the Plan. Except as otherwise provided in the Plan, the minimum
allocation shall be an Employer Non-Elective Contribution and, if no vesting
schedule has been selected in the Adoption Agreement, shall be subject to the 6
Year Graded vesting schedule described in the Adoption Agreement.

 

 

 

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9.2 DETERMINATION OF TOP HEAVY STATUS

 

 

 

 

          (a) This Plan shall be a Top Heavy Plan for any plan year beginning
after December 31, 1983, if any of the following conditions exists:

 

 

 

 

 

(1) if the “top heavy ratio” for this Plan exceeds sixty percent (60%) and this
Plan is not part of any “required aggregation group” or “permissive aggregation
group”;

 

 

 

 

 

(2) if this Plan is a part of a “required aggregation group” but not part of a
“permissive aggregation group” and the “top heavy ratio” for the group of plans
exceeds sixty percent (60%); or

 

 

 

 

 

(3) if this Plan is a part of a “required aggregation group” and part of a
“permissive aggregation group” and the “top heavy ratio” for the “permissive
aggregation group” exceeds sixty percent (60%).

 

 

 

 

          (b) “Top heavy ratio” means, with respect to a “determination date”:

 

 

 

 

 

(1) If the Employer maintains one or more defined contribution plans (including
any simplified employee pension plan (as defined in Code Section 408(k))) and
the Employer has not maintained any defined benefit plan which during the 5-year
period ending on the “determination date” has or has had accrued benefits, the
top heavy ratio for this plan alone or for the “required aggregation group” or
“permissive aggregation group” as appropriate is a fraction, the numerator of
which is the sum of the account balances of all Key Employees as of the
“determination date” (including any part of any account balance distributed in
the 5-year period ending on the “determination date”), and the denominator of
which is the sum of all account balances (including any part of any account
balance distributed in the 5-year period ending on the “determination date”),
both computed in accordance with Code Section 416 and the Regulations
thereunder. Both the numerator and denominator of the top heavy ratio are
increased to reflect any contribution not actually made as of the “determination
date,” but which is required to be taken into account on that date under Code
Section 416 and the Regulations thereunder.

 

 

 

 

 

(2) If the Employer maintains one or more defined contribution plans (including
any simplified employee pension plan) and the Employer maintains or has
maintained one or more defined benefit plans which during the 5-year period
ending on the “determination date” has or has had any accrued benefits, the top
heavy ratio for any “required aggregation group” or “permissive aggregation
group” as appropriate is a fraction, the numerator of which is the sum of
account balances under the aggregated defined contribution plan or plans for all
Key Employees, determined in accordance with (1) above, and the present value of
accrued benefits under the aggregated defined benefit plan or plans for all Key
Employees as of the “determination date,” and the denominator of which is the
sum of the account balances under the aggregated defined contribution plan or
plans for all participants, determined in accordance with (1) above, and the
“present value” of accrued benefits under the defined benefit plan or plans for
all participants as of the “determination date,” all determined in accordance
with Code Section 416 and the Regulations thereunder. The accrued benefits under
a defined benefit plan in both the numerator and denominator of the top heavy
ratio are increased for any distribution of an accrued benefit made in the
five-year period ending on the determination date.

 

 

 

 

 

(3) For purposes of (1) and (2) above, the value of account balances and the
present value of accrued benefits will 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. The account balances and accrued benefits of a participant (i) who is not
a Key Employee but who was a Key Employee in a prior year, or (ii) who has not
been credited with at least one Hour of Service with any Employer maintaining
the plan at any time during the 5-year period ending on the “determination date”
will be disregarded. The calculation of the top heavy ratio, and the extent to
which distributions, rollovers, and transfers are taken into account will be
made in accordance with Code Section 416 and the Regulations thereunder.
Deductible Employee contributions will not be taken into account for purposes of
computing the top heavy ratio. When aggregating plans the value of account
balances and accrued benefits will be calculated with reference to the
“determination dates” that fall within the same calendar year.

 

 

 

 

 

The accrued benefit of a participant other than a Key Employee shall be
determined under (i) the method, if any, that uniformly applies for accrual
purposes under all defined benefit plans maintained by the employer, or (ii) if
there is no such method, as if such benefit accrued not more rapidly than the
slowest accrual rate permitted under the fractional rule of Code Section
411(b)(1)(C).

 

 

 

 

          (c) “Determination date” means, for any Plan Year subsequent to the
first Plan Year, the last day of the preceding Plan Year. For the first Plan
Year of the Plan, “determination date” means the last day of that Plan Year.

 

 

 

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          (d) “Permissive aggregation group” means the “required aggregation
group” of plans plus any other plan or plans of the Employer which, when
considered as a group with the required aggregation group, would continue to
satisfy the requirements of Code Sections 401(a)(4) and 410.

 

 

 

 

          (e) “Present value” means the present value based only on the interest
and mortality rates specified in the Adoption Agreement.

 

 

 

 

          (f) “Required aggregation group” means: (1) each qualified plan of the
Employer in which at least one Key Employee participates or participated at any
time during the determination period (regardless of whether the plan has
terminated), and (2) any other qualified plan of the Employer which enables a
plan described in (l) to meet the requirements of Code Sections 401(a)(4) or
410.

 

 

 

 

          (g) “Valuation date” means the date elected by the Employer in the
Adoption Agreement as of which account balances or accrued benefits are valued
for purposes of calculating the “top heavy ratio.”

 

 

 

ARTICLE X
MISCELLANEOUS

 

 

 

10.1 EMPLOYER ADOPTIONS

 

 

 

 

          (a) Any organization may become the Employer hereunder by executing
the Adoption Agreement in a 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 or a separate agreement (including, if elected in the Adoption
Agreement, a separate trust 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.

 

 

 

10.2 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 the Employee as a Participant of
this Plan.

 

 

 

10.3 ALIENATION

 

 

 

 

          (a) Subject to the exceptions provided below and as otherwise
permitted by the Code and the Act, no benefit which shall be payable to any
person (including a Participant or the Participant’s 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) Subsection (a) shall not apply to the extent a Participant or
Beneficiary is indebted to the Plan by reason of a loan made pursuant to Section
7.6. At the time a distribution is to be made to or for a Participant’s or
Beneficiary’s benefit, such portion 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 notice by the Administrator that such indebtedness is
to be so paid in whole or part from the Participant’s interest in the Plan. If
the Participant or Beneficiary does not agree that the indebtedness is a valid
claim against the Participant’s interest in the Plan, the Participant or
Beneficiary shall be entitled to a review of the validity of the claim in
accordance with procedures provided in Sections 2.10 and 2.11.

 

 

 

 

          (c) Subsection (a) 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.

 

 

 

 

          (d) Notwithstanding any provision of this Section to the contrary, an
offset to a Participant’s accrued benefit against an amount that the Participant
is ordered or required to pay the Plan with respect to a judgment, order,

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

or decree issued, or a settlement entered into, on or after August 5, 1997,
shall be permitted in accordance with Code Sections 401(a)(13)(C) and (D).

 

 

 

10.4 CONSTRUCTION OF PLAN

 

 

 

                    This Plan and Trust shall be construed and enforced
according to the Code, the Act and the laws of the state or commonwealth in
which the Employer’s (or if there is a corporate Trustee, the Trustee’s)
principal office is located (unless otherwise designated in the Adoption
Agreement), other than its laws respecting choice of law, to the extent not
pre-empted by the Act.

 

 

 

10.5 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.

 

 

 

10.6 LEGAL ACTION

 

 

 

                    In the event any claim, suit, or proceeding is brought
regarding the Trust and/or Plan established hereunder to which the Trustee, the
Employer or the Administrator may be a party, and such claim, suit, or
proceeding is resolved in favor of the Trustee, the Employer or the
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.

 

 

 

10.7 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, Former Participants, or their
Beneficiaries.

 

 

 

 

          (b) In the event the Employer shall make a contribution under a
mistake of fact pursuant to Act Section 403(c)(2)(A), the Employer may demand
repayment of such contribution at any time within one (1) year following the
time of payment and the Trustee 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 but any losses attributable thereto must
reduce the amount so returned.

 

 

 

 

          (c) Except as specifically stated in the Plan, any contribution made
by the Employer to the Plan (if the Employer is not tax-exempt) 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 contribution may not be returned to the
Employer, but any losses attributable thereto must reduce the amount so
returned.

 

 

 

10.8 EMPLOYER’S AND TRUSTEE’S PROTECTIVE CLAUSE

 

 

 

                    The Employer, Administrator and Trustee, and their
successors, shall not 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.

 

 

 

10.9 INSURER’S PROTECTIVE CLAUSE

 

 

 

                    Except as otherwise agreed upon in writing between the
Employer and the Insurer, an Insurer which issues any 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 Administrator or 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 Administrator
or 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.

 

 

 

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10.10 RECEIPT AND RELEASE FOR PAYMENTS

 

 

 

                    Any payment to any Participant, the Participant’s 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.

 

 

 

10.11 ACTION BY THE EMPLOYER

 

 

 

                    Whenever the Employer under the terms of the Plan is
permitted or required to do or perform any act or matter or thing, it shall be
done and performed by a person duly authorized by its legally constituted
authority.

 

 

 

10.12 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY

 

 

 

                    The “named Fiduciaries” of this Plan are (1) the Employer,
(2) the Administrator, (3) the Trustee (if the Trustee has discretionary
authority as elected in the Adoption Agreement or as otherwise agreed upon by
the Employer and 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
including, but not limited to, any agreement allocating or delegating their
responsibilities, the terms of which are incorporated herein by reference. In
general, the Employer shall have the sole responsibility for making the
contributions provided for under the Plan; 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. If the Trustee
has discretionary authority, it 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 or Administrator, 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 its 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.

 

 

 

10.13 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.

 

 

 

10.14 APPROVAL BY INTERNAL REVENUE SERVICE

 

 

 

                    Notwithstanding anything herein to the contrary, if,
pursuant to a timely application filed by or on behalf of the Plan, the
Commissioner of the Internal Revenue Service or the Commissioner’s 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 (1) year and the Plan shall
terminate, and the Trustee shall be discharged from all further obligations. If
the disqualification relates to a Plan amendment, then the Plan shall operate as
if it had not been amended. If the Employer’s Plan fails to attain or retain
qualification, such Plan will no longer participate in this prototype plan and
will be considered an individually designed plan.

 

 

 

10.15 UNIFORMITY

 

 

 

                    All provisions of this Plan shall be interpreted and applied
in a uniform, nondiscriminatory manner.

 

 

 

10.16 PAYMENT OF BENEFITS

 

 

 

                    Except as otherwise provided in the Plan, benefits under
this Plan shall be paid, subject to Sections 6.10, 6.11 and 12.9, only upon
death, Total and Permanent Disability, normal or early retirement, termination
of employment, or termination of the Plan.

 

 

 

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ARTICLE XI
PARTICIPATING EMPLOYERS

 

 

 

11.1 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 the
Employer’s 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. Regardless of the
preceding, an entity that ceases to be an Affiliated Employer may continue to be
a Participating Employer through the end of the transition period for certain
dispositions set forth in Code Section 410(b)(6)(C). In the event a
Participating Employer is not an Affiliated Employer and the transition period
in the preceding sentence, if applicable, has expired, then this Plan will be
considered an individually designed plan.

 

 

 

11.2 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) 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. However, the assets of the Plan shall, on an
ongoing basis, be available to pay benefits to all Participants and
Beneficiaries under the Plan without regard to the Employer or Participating
Employer who contributed such assets.

 

 

 

 

          (c) Unless the Employer otherwise directs, 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.

 

 

 

11.3 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 purposes 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 otherwise, the word “Employer” shall
be deemed to include each Participating Employer as related to its adoption of
the Plan.

 

 

 

11.4 EMPLOYEE TRANSFERS

 

 

 

                    In the event an Employee is transferred between
Participating Employers, accumulated service and eligibility shall be carried
with the Employee involved. 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.

 

 

 

11.5 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. However, if a
Participating Employer is not an Affiliated Employer (due to the transition rule
for certain dispositions set forth in Code Section 410(b)(6)(C)) then any
contributions made by such Participating Employer will only be allocated among
the Participants eligible to share of the Participating Employer. On the basis
of the information furnished by the Administrator, the Trustee may 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 Participating Employer shall immediately
notify the Trustee thereof.

 

 

 

11.6 AMENDMENT

 

 

 

                    Amendment of this Plan by the Employer at any time when
there shall be a Participating Employer that is an Affiliated 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.

 

 

 

11.7 DISCONTINUANCE OF PARTICIPATION

 

 

 

                    Except in the case of a standardized Plan, any Participating
Employer that is an Affiliated 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,

 

 

 

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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 or custodian as shall have been
designated by such Participating Employer, in the event that it has established
a separate qualified retirement plan for its employees provided, however, that
no such transfer shall be made if the result is the elimination or reduction of
any “Section 411(d)(6) protected benefits” as described in Section 8.1(e). 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 to purposes other
than for the exclusive benefit of the employees of such Participating Employer.

 

 

 

11.8 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 Article.

 

 

 

11.9 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.

 

 

 

ARTICLE XII
CASH OR DEFERRED PROVISIONS

 

 

 

                    Except as specifically provided elsewhere in this Plan, the
provisions of this Article shall apply with respect to any 401(k) Profit Sharing
Plan regardless of any provisions in the Plan to the contrary.

 

 

 

12.1 FORMULA FOR DETERMINING EMPLOYER’S CONTRIBUTION

 

 

 

 

          (a) For each Plan Year, the Employer will (or may with respect to any
discretionary contributions) contribute to the Plan:

 

 

 

 

 

(1) The amount of the total salary reduction elections of all Participants made
pursuant to Section 12.2(a), which amount shall be deemed Elective Deferrals,
plus

 

 

 

 

 

(2) If elected in the Adoption Agreement, a matching contribution equal to the
percentage, if any, specified in the Adoption Agreement of the Elective
Deferrals of each Participant eligible to share in the allocations of the
matching contribution, which amount shall be deemed an Employer’s matching
contribution or Qualified Matching Contribution as elected in the Adoption
Agreement, plus

 

 

 

 

 

(3) If elected in the Adoption Agreement, a Prevailing Wage Contribution or a
discretionary amount determined each year by the Employer, which amount if any,
shall be deemed an Employer’s Non-Elective Contribution, plus

 

 

 

 

 

(4) If elected in the Adoption Agreement, a Qualified Non-Elective Contribution.

 

 

 

 

          (b) Notwithstanding the foregoing, if the Employer is not a tax-exempt
entity, then the Employer’s contributions for any Fiscal Year may generally 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 current or accumulated Net Profit or the amount that is deductible under
Code Section 404. All contributions by the Employer shall be made in cash or in
such property as is acceptable to the Trustee.

 

 

 

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12.2 PARTICIPANT’S SALARY REDUCTION ELECTION

 

 

 

 

          (a) Each Participant may elect to defer a portion of Compensation
which would have been received in the Plan Year, but for the salary reduction
election, subject to the limitations of this Section and the Adoption Agreement.
A salary reduction 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 later 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. If the automatic
election option is elected in the Adoption Agreement, then in the event a
Participant fails to make a deferral election and does not affirmatively elect
to receive cash, such Participant shall be deemed to have made a deferral
election equal to the percentage of Compensation set forth in the Adoption
Agreement. The automatic election may, in accordance with procedures established
by the Administrator, be applied to all Participants or to Eligible Employees
who become Participants after a certain date. For purposes of this Section, the
annual dollar limitation of Code Section 401(a)(17) ($150,000 as adjusted) shall
not apply.

 

 

 

 

                    Additionally, if elected in the Adoption Agreement, each
Participant may elect to defer a different percentage or amount of any cash
bonus to be paid by the Employer during the Plan Year. A deferral election may
not be made with respect to cash bonuses which are currently available on or
before the date the Participant executes such election.

 

 

 

 

                    The amount by which Compensation and/or cash bonuses are
reduced shall be that Participant’s Elective Deferrals and shall be treated as
an Employer contribution and allocated to that Participant’s Elective Deferral
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 Deferral Account,
Qualified Matching Contribution Account and Qualified Non-Elective Contribution
Account shall be fully Vested at all times and, except as otherwise provided
herein, shall not be subject to Forfeiture for any reason.

 

 

 

 

          (c) Amounts held in a Participant’s Elective Deferral Account,
Qualified Matching Contribution Account and Qualified Non-Elective Account may
only be distributable as provided in (4), (5) or (6) below or as provided under
the other provisions of this Plan, but in no event prior to the earlier of the
following events or any other events permitted by the Code or Regulations:

 

 

 

 

 

(1) the Participant’s separation from service, Total and Permanent Disability,
or death;

 

 

 

 

 

(2) the Participant’s attainment of age 59 1/2;

 

 

 

 

 

(3) the proven financial hardship of the Participant, subject to the limitations
of Section 12.9;

 

 

 

 

 

(4) the termination of the Plan without the existence at the time of Plan
termination of another defined contribution plan or the establishment of a
successor defined contribution plan 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. For this purpose, a defined contribution does
not include an employee stock ownership plan (as defined in Code Section
4975(e)(7) or 409), a simplified employee pension plan (as defined in Code
Section 408(k)), or a SIMPLE individual retirement account plan (as defined in
Code Section 408(p));

 

 

 

 

 

(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.

 

 

 

 

 

Distributions that are made because of (4), (5), or (6) above must be made in a
lump-sum.

 

 

 

 

          (d) A Participant’s “elective deferrals” made under this Plan and all
other plans, contracts or arrangements of the Employer maintaining this Plan
during any calendar year shall not exceed the dollar limitation imposed by Code
Section 402(g), as in effect at the beginning of such calendar year. This dollar
limitation shall be adjusted annually pursuant to the method provided in Code
Section 415(d) in accordance with Regulations. For this

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

purpose, “elective deferrals” means, with respect to a calendar year, the sum of
all employer contributions made on behalf of such Participant pursuant to an
election to defer under any qualified cash or deferred arrangement as described
in Code Section 401(k), any salary reduction simplified employee pension (as
defined in Code Section 408(k)(6)), any SIMPLE IRA plan described in Code
Section 408(p), any eligible deferred compensation plan under Code Section 457,
any plans described under Code Section 501(c)(18), and any Employer
contributions made on the behalf of a Participant for the purchase of an annuity
contract under Code Section 403(b) pursuant to a salary reduction agreement.
“Elective deferrals” shall not include any deferrals properly distributed as
excess “Annual Additions” pursuant to Section 4.5.

 

 

 

 

          (e) If a Participant has Excess Deferrals for a taxable year, the
Participant may, not later than March 1st following the close of such taxable
year, notify the Administrator in writing of such excess and request that the
Participant’s Elective Deferrals under this Plan be reduced by an amount
specified by the Participant. In such event, the Administrator shall direct the
distribution of 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. Any distribution of less than the
entire amount of Excess Deferrals and “Income” shall be treated as a pro rata
distribution of Excess Deferrals and “Income.” The amount distributed shall not
exceed the Participant’s Elective Deferrals 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 Deferrals;

 

 

 

 

 

(2) the distribution must be made after the date on which the Plan received the
Excess Deferrals; and

 

 

 

 

 

(3) the Plan must designate the distribution as a distribution of Excess
Deferrals.

 

 

 

 

                    Regardless of the preceding, if a Participant has Excess
Deferrals 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 and the Administrator shall direct the
distribution of such Excess Deferrals in a manner consistent with the provisions
of this subsection.

 

 

 

 

                    Any distribution made pursuant to this subsection shall be
made first from unmatched Elective Deferrals and, thereafter, from Elective
Deferrals which are matched. Matching contributions which relate to Excess
Deferrals that are distributed pursuant to this Section 12.2(e) shall be treated
as a Forfeiture to the extent required pursuant to Code Section 401(a)(4) and
the Regulations thereunder.

 

 

 

 

                    For the purpose of this subsection, “Income” means the
amount of income or loss allocable to a Participant’s Excess Deferrals, which
amount shall be allocated in the same manner as income or losses are allocated
pursuant to Section 4.3(c). However, “Income” for the period between the end of
the taxable year of the Participant and the date of the distribution (the “gap
period”) is not required to be distributed.

 

 

 

 

          (f) Notwithstanding the preceding, a Participant’s Excess Deferrals
shall be reduced, but not below zero, by any distribution and/or
recharacterization of Excess Deferrals pursuant to Section 12.5(a) for the Plan
Year beginning with or within the taxable year of the Participant.

 

 

 

 

          (g) 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 the Participant’s Elective Deferral Account pursuant to
Section 12.9, then such Participant shall not be permitted to elect to have
Elective Deferrals contributed to the Plan 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 Elective Deferrals, if any, made
pursuant to this Plan (and any other plan maintained by the Employer) for the
taxable year of the hardship distribution.

 

 

 

 

          (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 Deferral Account shall be used to provide benefits to the
Participant or the Participant’s Beneficiary.

 

 

 

 

          (i) If during a Plan Year, it is projected that the aggregate amount
of Elective Deferrals to be allocated to all Highly Compensated Participants
under this Plan would cause the Plan to fail the tests set forth in Section
12.4, then the Administrator may automatically reduce the deferral amount of
affected Highly Compensated Participants, beginning with the Highly Compensated
Participant who has the highest actual deferral ratio until it is anticipated
the Plan will pass the tests or until the actual deferral ratio equals the
actual deferral ratio of the Highly Compensated Participant having the next
highest actual deferral ratio. This process may continue until it is anticipated
that the Plan will satisfy one of the tests set forth in Section 12.4.
Alternatively, the Employer may specify a maximum percentage of Compensation
that may be deferred by Highly Compensated Participants.

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

          (j) The Employer and the Administrator shall establish procedures
necessary to implement the salary reduction elections provided for herein. Such
procedures may contain limits on salary deferral elections such as limiting
elections to whole percentages of Compensation or to equal dollar amounts per
pay period that an election is in effect.

 

 

 

12.3 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 Employer
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 contributions as follows:

 

 

 

 

 

(1) With respect to Elective Deferrals made pursuant to Section 12.1(a)(1), to
each Participant’s Elective Deferral Account in an amount equal to each such
Participant’s Elective Deferrals for the year.

 

 

 

 

 

(2) With respect to the Employer’s matching contribution made pursuant to
Section 12.1(a)(2), to each Participant’s Account, or Participant’s Qualified
Matching Contribution Account, as elected in the Adoption Agreement, in
accordance with Section 12.1(a)(2).

 

 

 

 

 

Except, however, in order to be entitled to receive any Employer matching
contribution, a Participant must satisfy the conditions for sharing in the
Employer matching contribution as set forth in the Adoption Agreement.
Furthermore, regardless of any election in the Adoption Agreement to the
contrary, for the Plan Year in which this Plan terminates, a Participant shall
only be eligible to share in the allocation of the Employer’s contributions for
the Plan Year if the Participant is employed at the end of the Plan Year and has
completed a Year of Service (or Period of Service if the Elapsed Time Method is
elected).

 

 

 

 

 

(3) With respect to the Employer’s Non-Elective Contribution made pursuant to
Section 12.1(a)(3), to each Participant’s Account in accordance with the
provisions of Section 4.3(b)(2) or (3) whichever is applicable.

 

 

 

 

 

(4) With respect to the Employer’s Qualified Non-Elective Contribution made
pursuant to Section 12.1(a)(4), to each Participant’s (excluding Highly
Compensated Employees, if elected in the Adoption Agreement) Qualified
Non-Elective Contribution Account in accordance with the Adoption Agreement.

 

 

 

 

          (c) Notwithstanding anything in the Plan to the contrary, in
determining whether a Non-Key Employee has received the required minimum
allocation pursuant to Section 4.3(f) such Non-Key Employee’s Elective Deferrals
and matching contributions used to satisfy the ADP tests in Section 12.4 or the
ACP tests in Section 12.6 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 deferral
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 4.3(f) and 12.3(f)), Participants shall only share in the allocations
of the Employer’s matching contribution made pursuant to Section 12.1(a)(2), the
Employer’s Non-Elective Contributions made pursuant to Section 12.1(a)(3), the
Employer’s Qualified Non-Elective Contribution made pursuant to Section
12.1(a)(4), and Forfeitures as provided in the Adoption Agreement. If no
election is made in the Adoption Agreement, then a Participant shall be eligible
to share in the allocation of the Employer’s contribution for the year if the
Participant completes more than 500 Hours of Service (or three (3) Months of
Service if the Elapsed Time method is chosen in the Adoption Agreement) during
the Plan Year or who is employed on the last day of the Plan Year. Furthermore,
regardless of any election in the Adoption Agreement to the contrary, for the
Plan Year in which this Plan terminates, a Participant shall only be eligible to
share in the allocation of the Employer’s contributions for the Plan Year if the
Participant is employed at the end of the Plan Year and has completed a Year of
Service (or Period of Service if the Elapsed Time Method is elected).

 

 

 

 

          (f) Notwithstanding anything in this Section to the contrary, the
provisions of this subsection apply for any Plan Year if, in the
non-standardized Adoption Agreement, the Employer elected to apply the 410(b)
ratio percentage failsafe provisions and the Plan fails to satisfy the “ratio
percentage test” due to a last day of the Plan Year allocation condition or an
Hours of Service (or months of service) allocation condition. A plan satisfies
the “ratio percentage test” if, on the last day of the Plan Year, the
“benefiting ratio” of the Non-Highly Compensated Employees who are “includible”
is at least 70% of the “benefiting ratio” of the Highly Compensated Employees
who are

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

“includible.” The “benefiting ratio” of the Non-Highly Compensated Employees is
the number of “includible” Non-Highly Compensated Employees “benefiting” under
the Plan divided by the number of “includible” Employees who are Non-Highly
Compensated Employees. The “benefiting ratio” of the Highly Compensated
Employees is the number of Highly Compensated Employees “benefiting” under the
Plan divided by the number of “includible” Highly Compensated Employees.
“Includible” Employees are all Employees other than: (1) those Employees
excluded from participating in the plan for the entire Plan Year by reason of
the collective bargaining unit exclusion or the nonresident alien exclusion
described in the Code or by reason of the age and service requirements of
Article III; and (2) any Employee who incurs a separation from service during
the Plan Year and fails to complete at least 501 Hours of Service (or three (3)
months of service if the Elapsed Time Method is being used) during such Plan
Year.

 

 

 

 

                    For purposes of this subsection, an Employee is “benefiting”
under the Plan on a particular date if, under the Plan, the Employee is entitled
to an Employer contribution or an allocation of Forfeitures for the Plan Year.

 

 

 

 

                    If this subsection applies, then the Administrator will
suspend the allocation conditions for the “includible” Non-Highly Compensated
Employees who are Participants, beginning first with the “includible” Employees
employed by the Employer on the last day of the Plan Year, then the “includible”
Employees who have the latest separation from service during the Plan Year, and
continuing to suspend the allocation conditions for each “includible” Employee
who incurred an earlier separation from service, from the latest to the earliest
separation from service date, until the Plan satisfies the “ratio percentage
test” for the Plan Year. If two or more “includible” Employees have a separation
from service on the same day, then the Administrator will suspend the allocation
conditions for all such “includible” Employees, irrespective of whether the Plan
can satisfy the “ratio percentage test” by accruing benefits for fewer than all
such “includible” Employees. If the Plan for any Plan Year suspends the
allocation conditions for an “includible” Employee, then that Employee will
share in the allocation for that Plan Year of the Employer contribution and
Forfeitures, if any, without regard to whether the Employee has satisfied the
other allocation conditions set forth in this Section.

 

 

 

 

 

If the Plan includes Employer matching contributions subject to ACP testing,
this subsection applies separately to the Code Section 401(m) portion of the
Plan.

 

 

 

12.4 ACTUAL DEFERRAL PERCENTAGE TESTS

 

 

 

 

          (a) Except as otherwise provided herein, this subsection applies if
the Prior Year Testing method is elected in the Adoption Agreement. The “Actual
Deferral Percentage” (hereinafter “ADP”) for a Plan Year for Participants who
are Highly Compensated Employees (hereinafter “HCEs”) for each Plan Year and the
prior year’s ADP for Participants who were Non-Highly Compensated Employees
(hereinafter “NHCEs”) for the prior Plan Year must satisfy one of the following
tests:

 

 

 

 

 

(1) The ADP for a Plan Year for Participants who are HCEs for the Plan Year
shall not exceed the prior year’s ADP for Participants who were NHCEs for the
prior Plan Year multiplied by 1.25; or

 

 

 

 

 

(2) The ADP for a Plan Year for Participants who are HCEs for the Plan Year
shall not exceed the prior year’s ADP for Participants who were NHCEs for the
prior Plan Year multiplied by 2.0, provided that the ADP for Participants who
are HCEs does not exceed the prior year’s ADP for Participants who were NHCEs in
the prior Plan Year by more than two (2) percentage points.

 

 

 

 

 

Notwithstanding the above, for purposes of applying the foregoing tests with
respect to the first Plan Year in which the Plan permits any Participant to make
Elective Deferrals, the ADP for the prior year’s NHCEs shall be deemed to be
three percent (3%) unless the Employer has elected in the Adoption Agreement to
use the current Plan Year’s ADP for these Participants. However, the provisions
of this paragraph may not be used if the Plan is a successor plan or is
otherwise prohibited from using such provisions pursuant to IRS Notice 98-1 (or
superseding guidance).

 

 

 

 

          (b) Notwithstanding the foregoing, if the Current Year Testing method
is elected in the Adoption Agreement, the ADP tests in (a)(1) and (a)(2), above
shall be applied by comparing the current Plan Year’s ADP for Participants who
are HCEs with the current Plan Year’s ADP (rather than the prior Plan Year’s
ADP) for Participants who are NHCEs for the current Plan Year. Once made, this
election can only be changed if the Plan meets the requirements for changing to
the Prior Year Testing method set forth in IRS Notice 98-1 (or superseding
guidance). Furthermore, this Plan must use the same testing method for both the
ADP and ACP tests for Plan Years beginning on or after the date the Employer
adopts its GUST restated plan.

 

 

 

 

          (c) This subsection applies to prevent the multiple use of the test
set forth in subsection (a)(2) above. Any HCE eligible to make Elective
Deferrals pursuant to Section 12.2 and to make after-tax voluntary Employee
contributions or to receive matching contributions under this Plan or under any
other plan maintained by the Employer or an Affiliated Employer, shall have
either the actual deferral ratio adjusted in the manner described in Section
12.5 or the actual contribution ratio adjusted in the manner described in
Section 12.7 so that the “Aggregate Limit” is not

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

exceeded pursuant to Regulation 1.401(m)-2. The amounts in excess of the
“Aggregate Limit” shall be treated as either an Excess Contribution or an Excess
Aggregate Contribution. The ADP and ACP of the HCEs are determined after any
corrections required to meet the ADP and ACP tests and are deemed to be the
maximum permitted under such tests for the Plan Year. Multiple use does not
occur if either the ADP or ACP of the HCEs does not exceed 1.25 multiplied by
the ADP and ACP of the NHCEs.

 

 

 

 

                    “Aggregate Limit” means the sum of (i) 125 percent of the
greater of the ADP of the NHCEs for the prior Plan Year or the ACP of such NHCEs
under the plan subject to Code Section 401(m) for the Plan Year beginning with
or within the prior Plan Year of the cash or deferred arrangement and (ii) the
lesser of 200% or two (2) plus the lesser of such ADP or ACP. “Lesser” is
substituted for “greater” in (i) above, and “greater” is substituted for
“lesser” after “two (2) plus the” in (ii) above if it would result in a larger
Aggregate Limit. If the Employer has elected in the Adoption Agreement to use
the Current Year Testing method, then in calculating the “Aggregate Limit” for a
particular Plan Year, the NHCEs ADP and ACP for that Plan Year, instead of the
prior Plan Year, is used.

 

 

 

 

          (d) A Participant is an HCE for a particular Plan Year if the
Participant meets the definition of an HCE in effect for that Plan Year.
Similarly, a Participant is an NHCE for a particular Plan Year if the
Participant does not meet the definition of an HCE in effect for that Plan Year.

 

 

 

 

          (e) For the purposes of this Section and Section 12.5, ADP means, for
a specific group of Participants for a Plan Year, the average of the ratios
(calculated separately for each Participant in such group) of (1) the amount of
Employer contributions actually paid over to the Plan on behalf of such
Participant for the Plan Year to (2) the Participant’s 414(s) Compensation for
such Plan Year. Employer contributions on behalf of any participant shall
include: (1) any Elective Deferrals made pursuant to the Participant’s deferral
election (including Excess Deferrals of HCEs), but excluding (i) Excess
Deferrals of NHCEs that arise solely from Elective Deferrals made under the plan
or plans of this Employer and (ii) Elective Deferrals that are taken into
account in the ACP tests set forth in Section 12.6 (provided the ADP test is
satisfied both with and without exclusion of these Elective Deferrals); and (2)
at the election of the Employer, Qualified Non-Elective Contributions and
Qualified Matching Contributions to the extent such contributions are not used
to satisfy the ACP test.

 

 

 

 

                    The actual deferral ratio for each Participant and the ADP
for each group shall be calculated to the nearest one-hundredth of one percent.
Elective Deferrals allocated to each Highly Compensated Participant’s Elective
Deferral Account shall not be reduced by Excess Deferrals to the extent such
excess amounts are made under this Plan or any other plan maintained by the
Employer.

 

 

 

 

          (f) For purposes of this Section and Section 12.5, a Highly
Compensated Participant and a Non-Highly Compensated Participant shall include
any Employee eligible to make salary deferrals pursuant to Section 12.2 for the
Plan Year. Such Participants who fail to make Elective Deferrals shall be
treated for ADP purposes as Participants on whose behalf no Elective Deferrals
are made.

 

 

 

 

          (g) In the event this Plan satisfies the requirements of Code Sections
401(a)(4), 401(k), or 410(b) only if aggregated with one or more other plans, or
if one or more other plans satisfy the requirements of such sections of the Code
only if aggregated with this Plan, then this Section shall be applied by
determining the ADP of Employees as if all such plans were a single plan. Any
adjustments to the NHCE ADP for the prior year will be made in accordance with
IRS Notice 98-1 and any superseding guidance, unless the Employer has elected in
the Adoption Agreement to use the Current Year Testing method. Plans may be
aggregated in order to satisfy Code Section 401(k) only if they have the same
Plan Year and use the same ADP testing method.

 

 

 

 

          (h) The ADP for any Participant who is an HCE for the Plan Year and
who is eligible to have Elective Deferrals (and Qualified Non-Elective
Contributions or Qualified Matching Contributions, or both, if treated as
Elective Deferrals for purposes of the ADP test) allocated to such Participant’s
accounts under two (2) or more arrangements described in Code Section 401(k),
that are maintained by the Employer, shall be determined as if such Elective
Deferrals (and, if applicable, such Qualified Non-Elective Contributions or
Qualified Matching Contributions, or both) were made under a single arrangement
for purposes of determining such HCE’s actual deferral ratio. However, 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. Notwithstanding the foregoing,
certain plans shall be treated as separate if mandatorily disaggregated under
Regulations under Code Section 401.

 

 

 

 

          (i) For purposes of determining the ADP and the amount of Excess
Contributions pursuant to Section 12.5, only Elective Deferrals, Qualified
Non-Elective Contributions and Qualified Matching Contributions contributed to
the Plan prior to the end of the twelve (12) month period immediately following
the Plan Year to which the contributions relate shall be considered.

 

 

 

 

          (j) Notwithstanding anything in this Section to the contrary, the
provisions of this Section and Section 12.5 may be applied separately (or will
be applied separately to the extent required by Regulations) to each “plan”

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

within the meaning of Regulation 1.401(k)-1(g)(11). Furthermore, for Plan Years
beginning after December 31, 1998, the provisions of Code Section 401(k)(3)(F)
may be used to exclude from consideration all Non-Highly Compensated Employees
who have not satisfied the minimum age and service requirements of Code Section
410(a)(1)(A).

 

 

 

 

12.5 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS

 

 

 

 

 

          (a) In the event (or, with respect to subsection (c) when the Prior
Year Testing method is being used, if it is anticipated) that for Plan Years
beginning after December 31, 1996, the Plan does not satisfy one of the tests
set forth in Section 12.4, the Administrator shall adjust Excess Contributions
or the Employer shall make contributions pursuant to the options set forth below
or any combination thereof. However, if the Prior Year testing method is being
used and it is anticipated that the Plan might not satisfy one of such tests,
then the Employer may make contributions pursuant to the options set forth in
subsection (c) below.

 

 

 

 

 

          (b) On or before the fifteenth day of the third month following the
end of each Plan Year, but in no event later than the close of the following
Plan Year, the Highly Compensated Participant allocated the largest amount of
Elective Deferrals shall have a portion of such Elective Deferrals (and “Income”
allocable to such amounts) distributed (and/or, at the Participant’s election,
recharacterized as a after-tax voluntary Employee contribution pursuant to
Section 4.8) until the total amount of Excess Contributions has been
distributed, or until the amount of the Participant’s Elective Deferrals equals
the Elective Deferrals of the Highly Compensated Participant having the next
largest amount of Elective Deferrals allocated. This process shall continue
until the total amount of Excess Contributions has been distributed. Any
distribution and/or recharacterization of Excess Contributions shall be made in
the following order:

 

 

 

 

 

 

(1) With respect to the distribution of Excess Contributions, 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 Elective Deferrals and, thereafter,
simultaneously from Elective Deferrals which are matched and matching
contributions which relate to such Elective Deferrals. Matching contributions
which relate to Excess Contributions shall be forfeited unless the related
matching contribution is distributed as an Excess Aggregate Contribution
pursuant to Section 12.7;

 

 

 

 

 

 

 

(iii) shall be adjusted for “Income”; and

 

 

 

 

 

 

 

(iv) shall be designated by the Employer as a distribution of Excess
Contributions (and “Income”).

 

 

 

 

 

 

(2) With respect to the recharacterization of Excess Contributions pursuant to
(a) above, such recharacterized 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 recharacterized
is notified of the recharacterization and the tax consequences of such
recharacterization;

 

 

 

 

 

 

 

(ii) shall not exceed the amount of Elective Deferrals on behalf of any Highly
Compensated Participant for any Plan Year;

 

 

 

 

 

 

 

(iii) shall be treated as after-tax voluntary Employee contributions for
purposes of Code Section 401(a)(4) and Regulation 1.401(k)-1(b). However, for
purposes of Sections 4.3(f) and 9.2 (top heavy rules), recharacterized Excess
Contributions continue to be treated as Employer contributions that are Elective
Deferrals. Excess Contributions (and “Income” attributable to such amounts)
recharacterized as after-tax voluntary Employee contributions shall continue to
be nonforfeitable and subject to the same distribution rules provided for in
Section 12.2(c); and

 

 

 

 

 

 

 

(iv) are not permitted if the amount recharacterized plus after-tax voluntary
Employee contributions actually made by such Highly Compensated Participant,
exceed the maximum amount of after-tax voluntary Employee contributions
(determined prior to application of Section 12.6) that such Highly Compensated
Participant is permitted to make under the Plan in the absence of
recharacterization.

 

 

 

 

 

 

(3) Any distribution and/or recharacterization of less than the entire amount of
Excess Contributions shall be treated as a pro rata distribution and/or
recharacterization of Excess Contributions and “Income.”

 

 

 

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(4) For the purpose of this Section, “Income” means the income or losses
allocable to Excess Contributions, which amount shall be allocated at the same
time and in the same manner as income or losses are allocated pursuant to
Section 4.3(c). However, “Income” for the period between the end of the Plan
Year and the date of the distribution (the “gap period”) is not required to be
distributed.

 

 

 

 

 

(5) Excess Contributions shall be treated as Employer contributions for purposes
of Code Sections 404 and 415 even if distributed from the Plan.

 

 

 

 

          (c) Notwithstanding the above, within twelve (12) months after the end
of the Plan Year (or, if the Prior Year Testing method is used, within twelve
(12) months after the end of the prior Plan Year), the Employer may make a
special Qualified Non-Elective Contribution or Qualified Matching Contribution
in accordance with one of the following provisions which contribution shall be
allocated to the Qualified Non-Elective Contribution Account or Qualified
Matching Contribution Account of each Non-Highly Compensated Participant
eligible to share in the allocation in accordance with such provision. The
Employer shall provide the Administrator with written notification of the amount
of the contribution being made and to which provision it relates.

 

 

 

 

 

(1) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated in the same proportion that each Non-Highly
Compensated Participant’s 414(s) Compensation for the year (or prior year if the
Prior Year Testing method is being used) bears to the total 414(s) Compensation
of all Non-Highly Compensated Participants for such year.

 

 

 

 

 

(2) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated in the same proportion that each Non-Highly
Compensated Participant’s 414(s) Compensation for the year (or prior year if the
Prior Year Testing method is being used) bears to the total 414(s) Compensation
of all Non-Highly Compensated Participants for such year. However, for purposes
of this contribution, Non-Highly Compensated Participants who are not employed
at the end of the Plan Year (or at the end of the prior Plan Year if the Prior
Year Testing method is being used) and, if this is a standardized Plan, who have
not completed more than 500 Hours of Service (or three (3) consecutive calendar
months if the Elapsed Time Method is selected in the Adoption Agreement) during
such Plan Year, shall not be eligible to share in the allocation and shall be
disregarded.

 

 

 

 

 

(3) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated in equal amounts (per capita).

 

 

 

 

 

(4) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated in equal amounts (per capita). However, for
purposes of this contribution, Non-Highly Compensated Participants who are not
employed at the end of the Plan Year (or at the end of the prior Plan Year if
the Prior Year Testing method is being used) and, if this is a standardized
Plan, who have not completed more than 500 Hours of Service (or three (3)
consecutive calendar months if the Elapsed Time Method is selected in the
Adoption Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

 

 

 

 

(5) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated to the Qualified Non-Elective Contribution
Account of the Non-Highly Compensated Participant having the lowest 414(s)
Compensation, until one of the tests set forth in Section 12.4 is satisfied (or
is anticipated to be satisfied), or until such Non-Highly Compensated
Participant has received the maximum “Annual Addition” pursuant to Section 4.4.
This process shall continue until one of the tests set forth in Section 12.4 is
satisfied (or is anticipated to be satisfied).

 

 

 

 

 

(6) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated to the Qualified Non-Elective Contribution
Account of the Non-Highly Compensated Participant having the lowest 414(s)
Compensation, until one of the tests set forth in Section 12.4 is satisfied (or
is anticipated to be satisfied), or until such Non-Highly Compensated
Participant has received the maximum “Annual Addition” pursuant to Section 4.4.
This process shall continue until one of the tests set forth in Section 12.4 is
satisfied (or is anticipated to be satisfied). However, for purposes of this
contribution, Non-Highly Compensated Participants who are not employed at the
end of the Plan Year (or at the end of the prior Plan Year if the Prior Year
Testing method is being used) and, if this is a standardized Plan, who have not
completed more than 500 Hours of Service (or three (3) consecutive

 

 

 

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calendar months if the Elapsed Time Method is selected in the Adoption
Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

 

 

 

 

(7) A Qualified Matching Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated to the Qualified Matching Contribution Account
of each Non-Highly Compensated Participant in the same proportion that each
Non-Highly Compensated Participant’s Elective Deferrals for the year bears to
the total Elective Deferrals of all Non-Highly Compensated Participants.

 

 

 

 

 

(8) A Qualified Matching Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated to the Qualified Matching Contribution Account
of each Non-Highly Compensated Participant in the same proportion that each
Non-Highly Compensated Participant’s Elective Deferrals for the year bears to
the total Elective Deferrals of all Non-Highly Compensated Participants.
However, for purposes of this contribution, Non-Highly Compensated Participants
who are not employed at the end of the Plan Year (or at the end of the prior
Plan Year if the Prior Year Testing method is being used) and, if this is a
standardized Plan, who have not completed more than 500 Hours of Service (or
three (3) consecutive calendar months if the Elapsed Time Method is selected in
the Adoption Agreement) during such Plan Year, shall not be eligible to share in
the allocation and shall be disregarded.

 

 

 

 

 

(9) A Qualified Matching Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated to the Qualified Matching Contribution Account
of the Non-Highly Compensated Participant having the lowest Elective Deferrals
until one of the tests set forth in Section 12.4 is satisfied (or is anticipated
to be satisfied), or until such Non-Highly Compensated Participant has received
the maximum “Annual Addition” pursuant to Section 4.4. This process shall
continue until one of the tests set forth in Section 12.4 is satisfied (or is
anticipated to be satisfied).

 

 

 

 

 

(10) A Qualified Matching Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4. Such
contribution shall be allocated to the Qualified Matching Contribution Account
of the Non-Highly Compensated Participant having the lowest Elective Deferrals
until one of the tests set forth in Section 12.4 is satisfied (or is anticipated
to be satisfied), or until such Non-Highly Compensated Participant has received
the maximum “Annual Addition” pursuant to Section 4.4. This process shall
continue until one of the tests set forth in Section 12.4 is satisfied (or is
anticipated to be satisfied). However, for purposes of this contribution,
Non-Highly Compensated Participants who are not employed at the end of the Plan
Year (or at the end of the prior Plan Year if the Prior Year Testing method is
being used) and, if this is a standardized Plan, who have not completed more
than 500 Hours of Service (or three (3) consecutive calendar months if the
Elapsed Time Method is selected in the Adoption Agreement) during such Plan
Year, shall not be eligible to share in the allocation and shall be disregarded.

 

 

 

 

          (d) Any Excess Contributions (and “Income”) which are distributed on
or after 2 1/2 months after the end of the Plan Year shall be subject to the ten
percent (10%) Employer excise tax imposed by Code Section 4979.

 

 

 

12.6 ACTUAL CONTRIBUTION PERCENTAGE TESTS

 

 

 

 

          (a) Except as otherwise provided herein, this subsection applies if
the Prior Year Testing method is elected in the Adoption Agreement. The “Actual
Contribution Percentage” (hereinafter “ACP”) for Participants who are Highly
Compensated Employees (hereinafter “HCEs”) for each Plan Year and the prior
year’s ACP for Participants who were Non-Highly Compensated Employees
(hereinafter “NHCEs”) for the prior Plan Year must satisfy one of the following
tests:

 

 

 

 

 

(1) The ACP for a Plan Year for Participants who are HCEs for the Plan Year
shall not exceed the prior year’s ACP for Participants who were NHCEs for the
prior Plan Year multiplied by 1.25; or

 

 

 

 

 

(2) The ACP for a Plan Year for Participants who are HCEs for the Plan Year
shall not exceed the prior year’s ACP for Participants who were NHCEs for the
prior Plan Year multiplied by 2.0, provided that the ACP for Participants who
are HCEs does not exceed the prior year’s ACP for Participants who were NHCEs in
the prior Plan Year by more than two (2) percentage points.

 

 

 

 

 

Notwithstanding the above, for purposes of applying the foregoing tests with
respect to the first Plan Year in which the Plan permits any Participant to make
Employee contributions, provides for matching contributions, or both, the ACP
for the prior year’s NHCEs shall be deemed to be three percent (3%) unless the
Employer

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

has elected in the Adoption Agreement to use the current Plan Year’s ACP for
these Participants. However, the provisions of this paragraph may not be used if
the Plan is a successor plan or is otherwise prohibited from using such
provisions pursuant to IRS Notice 98-1 (or superseding guidance).

 

 

 

 

          (b) Notwithstanding the preceding, if the Current Year Testing method
is elected in the Adoption Agreement, the ACP tests in (a)(1) and (a)(2), above
shall be applied by comparing the current Plan Year’s ACP for Participants who
are HCEs with the current Plan Year’s ACP (rather than the prior Plan Year’s
ACP) for Participants who are NHCEs for the current Plan Year. Once made, this
election can only be changed if the Plan meets the requirements for changing to
the Prior Year Testing method set forth in IRS Notice 98-1 (or superseding
guidance). Furthermore, this Plan must use the same testing method for both the
ADP and ACP tests for Plan Years beginning on or after the date the Employer
adopts its GUST restated plan.

 

 

 

 

          (c) This subsection applies to prevent the multiple use of the test
set forth in subsection (a)(2) above. Any HCE eligible to make Elective
Deferrals pursuant to Section 12.2 and to make after-tax voluntary Employee
contributions or to receive matching contributions under this Plan or under any
other plan maintained by the Employer or an Affiliated Employer, shall have
either the actual deferral ratio adjusted in the manner described in Section
12.5 or the actual contribution ratio reduced in the manner described in Section
12.7 so that the “Aggregate Limit” is not exceeded pursuant to Regulation
1.401(m)-2. The amounts in excess of the “Aggregate Limit” shall be treated as
either an Excess Contribution or an Excess Aggregate Contribution. The ADP and
ACP of the HCEs are determined after any corrections required to meet the ADP
and ACP tests and are deemed to be the maximum permitted under such test for the
Plan Year. Multiple use does not occur if either the ADP or ACP of the HCEs does
not exceed 1.25 multiplied by the ADP and ACP of the NHCEs.

 

 

 

 

“Aggregate Limit” means the sum of (i) 125 percent of the greater of the ADP of
the NHCEs for the Plan Year or the ACP of such NHCEs under the plan subject to
Code Section 401(m) for the Plan Year beginning with or within the prior Plan
Year of the cash or deferred arrangement and (ii) the lesser of 200% or two plus
the lesser of such ADP or ACP. “Lesser” is substituted for “greater” in (i)
above, and “greater” is substituted for “lesser” after “two plus the” in (ii)
above if it would result in a larger Aggregate Limit. If the Employer has
elected in the Adoption Agreement to use the Current Year Testing method, then
in calculating the “Aggregate Limit” for a particular Plan Year, the NHCEs ADP
and ACP for that Plan Year, instead of the prior Plan Year, is used.

 

 

 

 

          (d) A Participant is a Highly Compensated Employee for a particular
Plan Year if the Participant meets the definition of a Highly Compensated
Employee in effect for that Plan Year. Similarly, a Participant is a Non-highly
Compensated Employee for a particular Plan Year if the Participant does not meet
the definition of a Highly Compensated Employee in effect for that Plan Year.

 

 

 

 

          (e) For the purposes of this Section and Section 12.7, ACP for a
specific group of Participants for a Plan Year means the average of the
“Contribution Percentages” (calculated separately for each Participant in such
group). For this purpose, “Contribution Percentage” means the ratio (expressed
as a percentage) of the Participant’s “Contribution Percentage Amounts” to the
Participant’s 414(s) Compensation. The actual contribution ratio for each
Participant and the ACP for each group, shall be calculated to the nearest
one-hundredth of one percent of the Participant’s 414(s) Compensation.

 

 

 

 

          (f) “Contribution Percentage Amounts” means the sum of (i) after-tax
voluntary Employee contributions, (ii) Employer “Matching Contributions” made
pursuant to Section 12.1(a)(2) (including Qualified Matching Contributions to
the extent such Qualified Matching Contributions are not used to satisfy the
tests set forth in Section 12.4), (iii) Excess Contributions recharacterized as
nondeductible voluntary Employee contributions pursuant to Section 12.5, and
(iv) Qualified Non-Elective Contributions (to the extent not used to satisfy the
tests set forth in Section 12.4). However, “Contribution Percentage Amounts”
shall not include “Matching Contributions” that are forfeited either to correct
Excess Aggregate Contributions or due to Code Section 401(a)(4) and the
Regulations thereunder because the contributions to which they relate are Excess
Deferrals, Excess Contributions, or Excess Aggregate Contributions. In addition,
“Contribution Percentage Amounts” may include Elective Deferrals provided the
ADP test in Section 12.4 is met before the Elective Deferrals are used in the
ACP test and continues to be met following the exclusion of those Elective
Deferrals that are used to meet the ACP test.

 

 

 

 

          (g) For purposes of determining the ACP and the amount of Excess
Aggregate Contributions pursuant to Section 12.7, only Employer “Matching
Contributions” (excluding “Matching Contributions” forfeited or distributed
pursuant to Section 12.2(e), 12.5(b), or 12.7(b)) 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 12.1(a)(2) or
after-tax 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)(C)) contributed to any plan maintained by the Employer. Such
elective deferrals and qualified non-elective contributions shall be treated as
Employer matching contributions subject to Regulation 1.401(m)-1(b)(2) which is
incorporated herein by reference.

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

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.

 

 

 

 

          (h) In the event that this Plan satisfies the requirements of Code
Sections 401(a)(4), 401(m), or 410(b) only if aggregated with one or more other
plans, or if one or more other plans satisfy the requirements of such sections
of the Code only if aggregated with this Plan, then this Section shall be
applied by determining the ACP of Employees as if all such plans were a single
plan. Plans may be aggregated in order to satisfy Code section 401(m) only if
they have the same Plan Year.

 

 

 

 

                    Any adjustments to the NHCE ACP for the prior year will be
made in accordance with IRS Notice 98-1 and any superseding guidance, unless the
Employer has elected in the Adoption Agreement to use the Current Year Testing
method. Plans may be aggregated in order to satisfy Code Section 401(k) only if
they have the same Plan Year and use the same ACP testing method.

 

 

 

 

          (i) For the purposes of this Section, if an HCE is a Participant under
two (2) or more plans (other than an employee stock ownership plan as defined in
Code Section 4975(e)(7)) which are maintained by the Employer or an Affiliated
Employer to which “Matching Contributions,” nondeductible voluntary Employee
contributions, or both, are made, all such contributions on behalf of such HCE
shall be aggregated for purposes of determining such HCP’s actual contribution
ratio. However, if 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.

 

 

 

 

          (j) For purposes of this Section and Section 12.7, a Highly
Compensated Participant and a Non-Highly Compensated Participant shall include
any Employee eligible to have “Matching Contributions” made pursuant to Section
12.1(a)(2) (whether or not a deferral election was made or suspended pursuant to
Section 12.2(g)) allocated to such Participant’s account for the Plan Year or to
make salary deferrals pursuant to Section 12.2 (if the Employer uses salary
deferrals to satisfy the provisions of this Section) or after-tax voluntary
Employee contributions pursuant to Section 4.7 (whether or not nondeductible
voluntary Employee contributions are made) allocated to the Participant’s
account for the Plan Year.

 

 

 

 

          (k) For purposes of this Section and Section 12.7, “Matching
Contribution” means 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 a
nondeductible voluntary Employee contribution made by such Participant, or on
account of a Participant’s elective deferrals under a plan maintained by the
Employer.

 

 

 

 

          (l) For purposes of determining the ACP and the amount of Excess
Aggregate Contributions pursuant to Section 12.7, only Elective Deferrals,
Qualified Non-Elective Contributions, “Matching Contributions” and Qualified
Matching Contributions contributed to the Plan prior to the end of the twelve
(12) month period immediately following the Plan Year to which the contributions
relate shall be considered.

 

 

 

 

          (m) Notwithstanding anything in this Section to the contrary, the
provisions of this Section and Section 12.7 may be applied separately (or will
be applied separately to the extent required by Regulations) to each “plan”
within the meaning of Regulation 1.401(k)-1(g)(11). Furthermore, for Plan Years
beginning after December 31, 1998, the provisions of Code Section 401(k)(3)(F)
may be used to exclude from consideration all Non-Highly Compensated Employees
who have not satisfied the minimum age and service requirements of Code Section
410(a)(1)(A).

 

 

 

12.7 ADJUSTMENT TO ACTUAL CONTRIBUTION PERCENTAGE TESTS

 

 

 

 

          (a) In the event (or, with respect to subsection (g) below when the
Prior Year Testing method is being used, if it is anticipated) that for Plan
Years beginning after December 31, 1996, the Plan does not satisfy one of the
tests set forth in Section 12.6, the Administrator shall adjust Excess Aggregate
Contributions or the Employer shall make contributions pursuant to the options
set forth below or any combination thereof. However, if the Prior Year testing
method is being used and it is anticipated that the Plan might not satisfy one
of such tests, then the Employer may make contributions pursuant to the options
set forth in subsection (c) below.

 

 

 

 

          (b) 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 the Highly Compensated Participant having the largest allocation of
“Contribution Percentage Amounts” shall have a portion of such “Contribution
Percentage Amounts” (and “Income” allocable to such amounts) distributed or, if
non-Vested, Forfeited (including “Income” allocable to such Forfeitures) until
the total amount of Excess Aggregate Contributions has been distributed, or
until the amount of the Participant’s “Contribution Percentage Amounts” equals
the “Contribution Percentage Amounts” of the Highly Compensated Participant
having the next largest amount of “Contribution Percentage Amounts.” This
process shall continue until the total amount of Excess Aggregate Contributions
has been distributed or forfeited. Any distribution and/or Forfeiture of
“Contribution Percentage Amounts” shall be made in the following order:

 

 

 

 

 

(1) Employer matching contributions distributed and/or forfeited pursuant to
Section 12.5(b)(1);

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

(2) After-tax voluntary Employee contributions including Excess Contributions
recharacterized as after-tax voluntary Employee contributions pursuant to
Section 12.5(b)(2);

 

 

 

 

 

(3) Remaining Employer matching contributions.

 

 

 

 

          (c) Any distribution or Forfeiture of less than the entire amount of
Excess Aggregate 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.

 

 

 

 

          (d) For the purpose of this Section, “Income” means the income or
losses allocable to Excess Aggregate Contributions, which amount shall be
allocated at the same time and in the same manner as income or losses are
allocated pursuant to Section 4.3(c). However, “Income” for the period between
the end of the Plan Year and the date of the distribution (the “gap period”) is
not required to be distributed.

 

 

 

 

          (e) Excess Aggregate Contributions attributable to amounts other than
nondeductible 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.

 

 

 

 

          (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 nondeductible voluntary Employee
contributions due to recharacterization 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
after-tax voluntary Employee contributions due to recharacterization pursuant to
Section 12.5.

 

 

 

 

          (g) Notwithstanding the above, within twelve (12) months after the end
of the Plan Year (or, if the Prior Year Testing method is used, within twelve
(12) months after the end of the prior Plan Year), the Employer may make a
special Qualified Non-Elective Contribution or Qualified Matching Contribution
in accordance with one of the following provisions which contribution shall be
allocated to the Qualified Non-Elective Contribution Account or Qualified
Matching Contribution Account of each Non-Highly Compensated eligible to share
in the allocation in accordance with such provision. The Employer shall provide
the Administrator with written notification of the amount of the contribution
being made and for which provision it is being made pursuant to.

 

 

 

 

 

(1) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.6. Such
contribution shall be allocated in the same proportion that each Non-Highly
Compensated Participant’s 414(s) Compensation for the year (or prior year if the
Prior Year Testing method is being used) bears to the total 414(s) Compensation
of all Non-Highly Compensated Participants for such year.

 

 

 

 

 

(2) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.6. Such
contribution shall be allocated in the same proportion that each Non-Highly
Compensated Participant’s 414(s) Compensation for the year (or prior year if the
Prior Year Testing method is being used) bears to the total 414(s) Compensation
of all Non-Highly Compensated Participants for such year. However, for purposes
of this contribution, Non-Highly Compensated Participants who are not employed
at the end of the Plan Year (or at the end of the prior Plan Year if the Prior
Year Testing method is being used) and, if this is a standardized Plan, who have
not completed more than 500 Hours of Service (or three (3) consecutive calendar
months if the Elapsed Time Method is selected in the Adoption Agreement) during
such Plan Year, shall not be eligible to share in the allocation and shall be
disregarded.

 

 

 

 

 

(3) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.6. Such
contribution shall be allocated in equal amounts (per capita).

 

 

 

 

 

(4) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.6. Such
contribution shall be allocated in equal amounts (per capita). However, for
purposes of this contribution, Non-Highly Compensated Participants who are not
employed at the end of the Plan Year (or at the end of the prior Plan Year if
the Prior Year Testing method is being used) and, if this is a standardized
Plan, who have not completed more than 500 Hours of Service (or three (3)
consecutive

 

 

 

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

calendar months if the Elapsed Time Method is selected in the Adoption
Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

 

 

 

 

(5) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.6. Such
contribution shall be allocated to the Qualified Non-Elective Contribution
Account of the Non-Highly Compensated Participant having the lowest 414(s)
Compensation, until one of the tests set forth in Section 12.6 is satisfied (or
is anticipated to be satisfied), or until such Non-Highly Compensated
Participant has received the maximum “Annual Addition” pursuant to Section 4.4.
This process shall continue until one of the tests set forth in Section 12.6 is
satisfied (or is anticipated to be satisfied).

 

 

 

 

 

(6) A Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.6. Such
contribution shall be allocated to the Qualified Non-Elective Contribution
Account of the Non-Highly Compensated Participant having the lowest 414(s)
Compensation, until one of the tests set forth in Section 12.6 is satisfied (or
is anticipated to be satisfied), or until such Non-Highly Compensated
Participant has received the maximum “Annual Addition” pursuant to Section 4.4.
This process shall continue until one of the tests set forth in Section 12.6 is
satisfied (or is anticipated to be satisfied). However, for purposes of this
contribution, Non-Highly Compensated Employees who are not employed at the end
of the Plan Year (or at the end of the prior Plan Year if the Prior Year Testing
method is being used) and, if this is a standardized Plan, who have not
completed more than 500 Hours of Service (or three (3) consecutive calendar
months if the Elapsed Time Method is selected in the Adoption Agreement) during
such Plan Year, shall not be eligible to share in the allocation and shall be
disregarded.

 

 

 

 

 

(7) A “Matching Contribution” may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.6. Such contribution shall
be allocated on behalf of each Non-Highly Compensated Participant in the same
proportion that each Non-Highly Compensated Participant’s Elective Deferrals for
the year bears to the total Elective Deferrals of all Non-Highly Compensated
Participants. The Employer shall designate, at the time the contribution is
made, whether the contribution made pursuant to this provision shall be a
Qualified Matching Contribution allocated to a Participant’s Qualified Matching
Contribution Account or an Employer Non-Elective Contribution allocated to a
Participant’s Non-Elective Account.

 

 

 

 

 

(8) A “Matching Contribution” may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.6. Such contribution shall
be allocated on behalf of each Non-Highly Compensated Participant in the same
proportion that each Non-Highly Compensated Participant’s Elective Deferrals for
the year bears to the total Elective Deferrals of all Non-Highly Compensated
Participants. The Employer shall designate, at the time the contribution is
made, whether the contribution made pursuant to this provision shall be a
Qualified Matching Contribution allocated to a Participant’s Qualified Matching
Contribution Account or an Employer Non-Elective Contribution allocated to a
Participant’s Non-Elective Account. However, for purposes of this contribution,
Non-Highly Compensated Participants who are not employed at the end of the Plan
Year (or at the end of the prior Plan Year if the Prior Year Testing method is
being used) and, if this is a standardized Plan, who have not completed more
than 500 Hours of Service (or three (3) consecutive calendar months if the
Elapsed Time Method is selected in the Adoption Agreement) during such Plan
Year, shall not be eligible to share in the allocation and shall be disregarded.

 

 

 

 

 

(9) A “Matching Contribution” may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.4. Such contribution shall
be allocated on behalf of the Non-Highly Compensated Participant having the
lowest Elective Deferrals until one of the tests set forth in Section 12.4 is
satisfied (or is anticipated to be satisfied), or until such Non-Highly
Compensated Participant has received the maximum “Annual Addition” pursuant to
Section 4.4. This process shall continue until one of the tests set forth in
Section 12.4 is satisfied (or is anticipated to be satisfied). The Employer
shall designate, at the time the contribution is made, whether the contribution
made pursuant to this provision shall be a Qualified Matching Contribution
allocated to a Participant’s Qualified Matching Contribution Account or an
Employer Non-Elective Contribution allocated to a Participant’s Non-Elective
Account.

 

 

 

 

 

(10) A “Matching Contribution” may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.4. Such contribution shall
be allocated on behalf of the Non-Highly Compensated Participant having the
lowest Elective Deferrals until one of the tests set forth in Section 12.4 is
satisfied (or is anticipated to be satisfied), or until such Non-Highly
Compensated Participant has received the maximum “Annual Addition” pursuant to
Section 4.4. This process shall continue until one of the tests set forth in
Section 12.4 is satisfied (or is anticipated to be satisfied). The Employer
shall designate, at the time the contribution is made, whether the

 

 

 

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contribution made pursuant to this provision shall be a Qualified Matching
Contribution allocated to a Participant’s Qualified Matching Contribution
Account or an Employer Non-Elective Contribution allocated to a Participant’s
Non-Elective Account. However, for purposes of this contribution, Non-Highly
Compensated Participants who are not employed at the end of the Plan Year (or at
the end of the prior Plan Year if the Prior Year Testing method is being used)
and, if this is a standardized Plan, who have not completed more than 500 Hours
of Service (or three (3) consecutive calendar months if the Elapsed Time Method
is selected in the Adoption Agreement) during such Plan Year, shall not be
eligible to share in the allocation and shall be disregarded.

 

 

 

 

          (h) Any Excess Aggregate Contributions (and “Income”) which are
distributed on or after 2 1/2 months after the end of the Plan Year shall be
subject to the ten percent (10%) Employer excise tax imposed by Code Section
4979.

 

 

 

12.8 SAFE HARBOR PROVISIONS

 

 

 

 

          (a) The provisions of this Section will apply if the Employer has
elected, in the Adoption Agreement, to use the “ADP Test Safe Harbor” or “ACP
Test Safe Harbor.” If the Employer has elected to use the “ADP Test Safe Harbor”
for a Plan Year, then the provisions relating to the ADP test described in
Section 12.4 and in Code Section 401(k)(3) do not apply for such Plan Year. In
addition, if the Employer has also elected to use the “ACP Test Safe Harbor” for
a Plan Year, then the provisions relating to the ACP test described in Section
12.6 and in Code Section 401(m)(2) do not apply for such Plan Year. Furthermore,
to the extent any other provision of the Plan is inconsistent with the
provisions of this Section, the provisions of this Section will govern.

 

 

 

 

 

(b) For purposes of this Section, the following definitions apply:

 

 

 

 

 

(1) “ACP Test Safe Harbor” means the method described in subsection (c) below
for satisfying the ACP test of Code Section 401(m)(2).

 

 

 

 

 

(2) “ACP Test Safe Harbor Matching Contributions” means “Matching Contributions”
described in subsection (d)(1).

 

 

 

 

 

(3) “ADP Test Safe Harbor” means the method described in subsection (c) for
satisfying the ADP test of Code Section 401(k)(3).

 

 

 

 

 

(4) “ADP Test Safe Harbor Contributions” means “Matching Contributions” and
nonelective contributions described in subsection (c)(1) below.

 

 

 

 

 

(5) “Compensation” means Compensation as defined in Section 1.11, except, for
purposes of this Section, no dollar limit, other than the limit imposed by Code
Section 401(a)(17), applies to the Compensation of a Non-Highly Compensated
Employee. However, solely for purposes of determining the Compensation subject
to a Participant’s deferral election, the Employer may use an alternative
definition to the one described in the preceding sentence, provided such
alternative definition is a reasonable definition within the meaning of
Regulation 1.414(s)-1(d)(2) and permits each Participant to elect sufficient
Elective Deferrals to receive the maximum amount of “Matching Contributions”
(determined using the definition of Compensation described in the preceding
sentence) available to the Participant under the Plan.

 

 

 

 

 

(6) “Eligible Participant” means a Participant who is eligible to make Elective
Deferrals under the Plan for any part of the Plan Year (or who would be eligible
to make Elective Deferrals but for a suspension due to a hardship distribution
described in Section 12.9 or to statutory limitations, such as Code Sections
402(g) and 415) and who is not excluded as an “Eligible Participant” under the
401(k) Safe Harbor elections in the Adoption Agreement.

 

 

 

 

 

(7) “Matching Contributions” means contributions made by the Employer on account
of an “Eligible Participant’s” Elective Deferrals.

 

 

 

 

 

(c) The provisions of this subsection apply for purposes of satisfying the “ADP
Test Safe Harbor.”

 

 

 

 

 

(1) The “ADP Test Safe Harbor Contribution” is the contribution elected by the
Employer in the Adoption Agreement to be used to satisfy the “ADP Test Safe
Harbor.” However, if no contribution is elected in the Adoption Agreement, the
Employer will contribute to the Plan for the Plan Year a “Basic Matching
Contribution” on behalf of each “Eligible Employee.” The “Basic Matching
Contribution” is equal to (i) one-hundred percent (100%) of the amount of an
“Eligible Participant’s” Elective Deferrals that do not exceed three percent
(3%) of the Participant’s “Compensation” for the Plan Year, plus (ii) fifty
percent (50%) of the amount of the Participant’s Elective Deferrals that exceed
three percent (3%) of the Participant’s “Compensation” but do not exceed five
percent (5%) of the Participant’s “Compensation.”

 

 

 

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(2) Except as provided in subsection (e) below, for purposes of the Plan, a
Basic Matching Contribution or an Enhanced Matching Contribution will be treated
as a Qualified Matching Contribution and a Nonelective Safe Harbor Contribution
will be treated as a Qualified Non-Elective Contribution. Accordingly, the “ADP
Test Safe Harbor Contribution” will be fully Vested and subject to the
distribution restrictions set forth in Section 12.2(c) (i.e., may generally not
be distributed earlier than separation from service, death, disability, an event
described in Section 401(k)(1), or, in case of a profit sharing plan, the
attainment of age 59 1/2.). In addition, such contributions must satisfy the
“ADP Test Safe Harbor” without regard to permitted disparity under Code Section
401(l).

 

 

 

 

 

(3) At least thirty (30) days, but not more than ninety (90) days, before the
beginning of the Plan Year, the Employer will provide each “Eligible
Participant” a comprehensive notice of the Participant’s rights and obligations
under the Plan, written in a manner calculated to be understood by the average
Participant. However, if an Employee becomes eligible after the 90th day before
the beginning of the Plan Year and does not receive the notice for that reason,
the notice must be provided no more than ninety (90) days before the Employee
becomes eligible but not later than the date the Employee becomes eligible.

 

 

 

 

 

(4) In addition to any other election periods provided under the Plan, each
“Eligible Participant” may make or modify a deferral election during the thirty
(30) day period immediately following receipt of the notice described in
subsection (3) above. Furthermore, if the “ADP Test Safe Harbor” is a “Matching
Contribution” each “Eligible Employee” must be permitted to elect sufficient
Elective Deferrals to receive the maximum amount of “Matching Contributions”
available to the Participant under the Plan.

 

 

 

 

 

(d) The provisions of this subsection apply if the Employer has elected to
satisfy the “ACP Test Safe Harbor.”

 

 

 

 

 

(1) In addition to the “ADP Test Safe Harbor Contributions,” the Employer will
make any “Matching Contributions” in accordance with elections made in the
Adoption Agreement. Such additional “Matching Contributions” will be considered
“ACP Test Safe Harbor Matching Contributions.”

 

 

 

 

 

(2) Notwithstanding any election in the Adoption Agreement to the contrary, an
“Eligible Participant’s” Elective Deferrals in excess of six percent (6%) of
“Compensation” may not be taken into account in applying “ACP Test Safe Harbor
Matching Contributions.” In addition, effective with respect to Plan Years
beginning after December 31, 1999, any portion of an “ACP Test Safe Harbor
Matching Contribution” attributable to a discretionary “Matching Contribution”
may not exceed four percent (4%) of an “Eligible Participant’s” “Compensation.”

 

 

 

 

          (e) The Plan is required to satisfy the ACP test of Code Section
401(m)(2), using the current year testing method, if the Plan permits after-tax
voluntary Employee contributions or if matching contributions that do not
satisfy the “ACP Test Safe Harbor” may be made to the Plan. In such event, only
“ADP Test Safe Harbor Contributions” or “ACP Test Safe Harbor Contributions”
that exceed the amount needed to satisfy the “ADP Test Harbor” or “ACP Test Safe
Harbor” (if the Employer has elected to use the “ACP Test Safe Harbor”) may be
treated as Qualified Nonelective Contributions or Qualified Matching
Contributions in applying the ACP test. In addition, in applying the ACP test,
elective contributions may not treated as matching contributions under Code
Section 401(m)(3). Furthermore, in applying the ACP test, the Employer may elect
to disregard with respect to all “Eligible Participants” (1) all “Matching
Contributions” if the only “Matching Contributions” made to the Plan satisfy the
“ADP Test Safe Harbor Contribution” (the “Basic Matching Contribution” or the
“Enhanced Matching Contribution”) and (2) if the “ACP Test Safe Harbor” is
satisfied, “Matching Contributions” that do not exceed four percent (4%) of each
Participant’s “Compensation.”

 

 

12.9 ADVANCE DISTRIBUTION FOR HARDSHIP

 

 

 

 

          (a) The Administrator, at the election of a Participant, shall direct
the Trustee to distribute to the Participant in any one Plan Year up to the
lesser of (1) 100% of the accounts as elected in the Adoption Agreement valued
as of the last 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 for one of the following or any other item permitted under
Regulation 1.401(k)-1(d)(2)(iv):

 

 

 

 

 

(1) Medical expenses described in Code Section 213(d) incurred by the
Participant, the Participant’s spouse, or any of the Participant’s dependents
(as defined in Code Section 152) or necessary for these persons to obtain
medical care as described in Code Section 213(d);

 

 

 

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(2) Costs directly related to the purchase (excluding mortgage payments) of a
principal residence for the Participant;

 

 

 

 

 

(3) Payment of tuition and related educational fees, and room and board
expenses, for the next twelve (12) months of post-secondary education for the
Participant, the Participant’s spouse, children, or dependents (as defined in
Code Section 152); or

 

 

 

 

 

(4) Payments necessary to prevent the eviction of the Participant from the
Participant’s principal residence or foreclosure on the mortgage on that
residence.

 

 

 

 

          (b) 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 (to the extent the loan would not increase the
hardship);

 

 

 

 

 

(3) The Plan, and all other plans maintained by the Employer, provide that the
Participant’s elective deferrals and nondeductible 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.

 

 

 

 

          (c) Notwithstanding the above, distributions from the Participant’s
Elective Deferral Account, Qualified Matching Contribution Account and Qualified
Non-Elective Account pursuant to this Section shall be limited solely to the
Participant’s Elective Deferrals and any income attributable thereto credited to
the Participant’s Elective Deferral Account as of December 31, 1988.
Furthermore, if a hardship distribution is permitted from more than one account
type, the Administrator may determine any ordering of a Participant’s hardship
distribution from such accounts.

 

 

 

 

          (d) 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.

 

 

 

ARTICLE XIII
SIMPLE 401(K) PROVISIONS

 

 

 

13.1 SIMPLE 401(k) PROVISIONS

 

 

 

 

          (a) If elected in the Adoption Agreement, this Plan is intended to be
a SIMPLE 401(k) plan which satisfies the requirements of Code Sections
401(k)(11) and 401(m)(10).

 

 

 

 

 

(b) The provisions of this Article apply for a “year” only if the following
conditions are met:

 

 

 

 

 

(1) The Employer adopting this Plan is an “eligible employer.” An “eligible
employer” means, with respect to any “year,” an Employer that had no more than
100 Employees who received at least $5,000 of “compensation” from the Employer
for the preceding “year.” In applying the preceding sentence, all employees of
an Affiliated Employer are taken into account.

 

 

 

 

 

An “eligible employer” that has elected to use the SIMPLE 401(k) provisions but
fails to be an “eligible employer” for any subsequent “year,” is treated as an
“eligible employer” for the two (2) “years” following the last “year” the
Employer was an “eligible employer.” If the failure is due to any acquisition,
disposition, or similar transaction involving an “eligible employer,” the
preceding sentence applies only if the provisions of Code Section
410(b)(6)(C)(i) are satisfied.

 

 

 

 

 

(2) No contributions are made, or benefits accrued for services during the
“year,” on behalf of any “eligible employee” under any other plan, contract,
pension, or trust described in Code Section 219(g)(5)(A) or (B), maintained by
the Employer.

 

 

 

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          (c) To the extent that any other provision of the Plan is inconsistent
with the provisions of this Article, the provisions of this Article govern.

13.2 DEFINITIONS

 

 

 

          (a) “Compensation” means, for purposes of this Article, the sum of the
wages, tips, and other compensation from the Employer subject to federal income
tax withholding (as described in Code Section 6051(a)(3)) and the Employee’s
salary reduction contributions made under this or any other 401(k) plan, and, if
applicable, elective deferrals under a Code Section 408(p) SIMPLE plan, a
SARSEP, or a Code Section 403(b) annuity contract and compensation deferred
under a Code Section 457 plan, required to be reported by the Employer on Form
W-2 (as described in Code Section 6051(a)(8)). For self-employed individuals,
“compensation” means net earnings from self-employment determined under Code
Section 1402(a) prior to subtracting any contributions made under this Plan on
behalf of the individual. The provisions of the plan implementing the limit on
Compensation under Code Section 401(a)(17) apply to the “compensation” under
this Article.

 

 

 

          (b) “Eligible employee” means, for purposes of this Article, any
Participant who is entitled to make elective deferrals described in Code Section
402(g) under the terms of the Plan.

 

 

 

          (c) “Year” means the calendar year.

13.3 CONTRIBUTIONS

 

 

 

 

 

(a) Salary Reduction Contributions

 

 

 

 

 

(1) Each “eligible employee” may make a salary reduction election to have
“compensation” reduced for the “year” in any amount selected by the Employee
subject to the limitation in subsection (c) below. The Employer will make a
salary reduction contribution to the Plan, as an Elective Deferral, in the
amount by which the Employee’s “compensation” has been reduced.

 

 

 

 

 

(2) The total salary reduction contribution for the “year” cannot exceed $6,000
for any Employee. To the extent permitted by law, this amount will be adjusted
to reflect any annual cost-of-living increases announced by the IRS.

 

 

 

 

 

(b) Other Contributions

 

 

 

 

 

(1) Matching Contributions. Unless (2) below is elected, each “year” the
Employer will make a matching contribution to the Plan on behalf of each
Employee who makes a salary reduction election under Section 13.3(a). The amount
of the matching contribution will be equal to the Employee’s salary reduction
contribution up to a limit of three percent (3%) of the Employee’s
“compensation” for the full “year.”

 

 

 

 

 

(2) Nonelective Contributions. For any “year,” instead of a matching
contribution, the Employer may elect to contribute a nonelective contribution of
two percent (2%) of “compensation” for the “year” for each “eligible employee”
who received at least $5,000 of “compensation” from the Employer for the “year.”

 

 

 

 

 

(c) Limitation on Other Contributions

 

 

 

 

 

No Employer or Employee contributions may be made to this Plan for the “year”
other than salary reduction contributions described in Section 13.3(a), matching
or nonelective contributions described in Section 13.3(b) and rollover
contributions described in Regulation Section 1.402(c)-2, Q&A-1(a). Furthermore,
the provisions of Section 4.4 which implement the limitations of Code Section
415 apply to contributions made pursuant to this Section.

13.4 ELECTION AND NOTICE REQUIREMENTS

 

 

 

 

 

(a) Election Period

 

 

 

 

 

(1) In addition to any other election periods provided under the Plan, each
“eligible employee” may make or modify a salary reduction election during the
60-day period immediately preceding each January 1st.

 

 

 

 

 

(2) For the “year” an Employee becomes eligible to make salary reduction
contributions under this Article, the 60-day election period requirement of
subsection (a)(1) is deemed satisfied if the Employee may make or modify a
salary reduction election during a 60-day period that includes either the date
the Employee becomes eligible or the day before.

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DEFINED CONTRIBUTION PLAN

 

 

 

 

 

(3) Each “eligible employee” may terminate a salary reduction election at any
time during the “year.”

 

 

 

 

 

(b) Notice Requirements

 

 

 

 

 

(1) The Employer will notify each “eligible employee” prior to the 60-day
election period described in Section 13.4(a) that a salary reduction election or
a modification to a prior election may be made during that period.

 

 

 

 

 

(2) The notification described in (1) above will indicate whether the Employer
will provide a matching contribution described in Section 13.3(b)(1) or a two
percent (2%) nonelective contribution described in section 13.3(b)(2).

13.5 VESTING REQUIREMENTS

                     All benefits attributable to contributions made pursuant to
this Article are nonforfeitable at all times, and all previous contributions
made under the Plan are nonforfeitable as of the beginning of the Plan Year that
the 401(k) SIMPLE provisions apply.

13.6 TOP-HEAVY RULES

                     The Plan is not treated as a top heavy plan under Code
Section 416 for any year for which the provisions of this Article are effective
and satisfied.

13.7 NONDISCRIMINATION TESTS

                     The Plan is treated as meeting the requirements of Code
Sections 401(k)(3)(A)(ii) and 401(m)(2) for any “year” for which the provisions
of this Article are effective and satisfied. Accordingly, Sections 12.4, 12.5,
12.6 and 12.7 shall not apply to the Plan.

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AMENDMENT TO
DEFINED CONTRIBUTION PLAN AND TRUST

           Effective with respect to Employers adopting this prototype plan on
or after July 1, 2002, Section 7.1(a) of the Plan is amended in its entirety to
read as follows:

 

 

 

          (a) The provisions of this Article, other than Section 7.6, shall not
apply to this Plan if a separate trust agreement, that has been approved by the
Internal Revenue Service for use with this Plan, is being used.

           Pursuant to Section 8.1(c) of the Plan, the mass submitter of the
prototype plan has made this amendment (as evidenced by the submission of the
amendment to the Internal Revenue Service for inclusion with the mass submitter
prototype plan) on behalf of minor modifier sponsors that received opinion
letters prior to March 1, 2002, and all identical sponsors of the mass submitter
prototype plan.

--------------------------------------------------------------------------------

AMENDMENT NO. 2 TO THE
GETTY REALTY CORP. RETIREMENT AND PROFIT SHARING PLAN

ARTICLE I
GENERAL RULES APPLICABLE TO ARTICLES II THROUGH V

 

 

1.1

Precedence. The requirements of this Amendment will take precedence over any
inconsistent provisions of the Plan.

 

 

1.2

Effective Date. The provisions of Articles II through V will apply for purposes
of determining required minimum distributions for calendar years beginning with
the 2003 calendar year.

 

 

1.3

Requirements of Treasury Regulations Incorporated. All distributions required
under Articles II through V will be determined and made in accordance with the
Treasury regulations under Section 401(a)(9) of the Internal Revenue Code.

 

 

1.4

TEFRA Section 242(b)(2) Elections. Notwithstanding the other provisions of
Articles II through V, distributions may be made under a designation made before
January 1, 1984, in accordance with Section 242(b)(2) of the Tax Equity and
Fiscal Responsibility Act (TEFRA) and the provisions of the Plan that relate to
Section 242(b)(2) of TEFRA.

ARTICLE II
TIME AND MANNER OF MINIMUM DISTRIBUTION REQUIRED UNDER CODE
SECTION 401(a)(9)

 

 

 

2.1

Required Beginning Date. The Participant’s entire interest will be distributed,
or begin to be distributed, to the Participant no later than the Participant’s
required beginning date.

 

 

 

2.2

Death of Participant Before Distributions Begin. If the Participant dies before
distributions begin, the Participant’s entire interest will be distributed, or
begin to be distributed, no later than as follows:

 

 

 

 

 

(a) If the Participant’s surviving spouse is the Participant’s sole designated
beneficiary, then distributions to the surviving spouse will begin by December
31 of the calendar year immediately following the calendar year in which the
Participant died, or by December 31 of the calendar year in which the
Participant would have attained age 70 1/2, if later.

 

 

 

 

 

(b) If the Participant’s surviving spouse is not the Participant’s sole
designated beneficiary, distributions to the designated beneficiary will begin
by December 31 of the calendar year immediately following the calendar year in
which the Participant died.

1

--------------------------------------------------------------------------------

 

 

 

 

 

(c) If there is no designated beneficiary as of September 30 of the year
following the year of the Participant’s death, the Participant’s entire interest
will be distributed by December 31 of the calendar year containing the fifth
anniversary of the Participant’s death.

 

 

 

 

 

(d) If the Participant’s surviving spouse is the Participant’s sole designated
beneficiary and the surviving spouse dies after the Participant but before
distributions to the surviving spouse begin, this Section 2.2, other than
Section 2.2(a), will apply as if the surviving spouse were the Participant.

 

 

 

 

For purposes of this Section 2.2 and Article IV, unless Section 2.2(d) applies,
distributions are considered to begin on the Participant’s required beginning
date. If Section 2.2(d) applies, distributions are considered to begin on the
date distributions are required to begin to the surviving spouse under Section
2.2(a). If distributions under an annuity purchased from an insurance company
irrevocably commence to the Participant before the Participant’s required
beginning date (or to the Participant’s surviving spouse before the date
distributions are required to begin to the surviving spouse under Section
2.2(a)), the date distributions are considered to begin is the date
distributions actually commence.

 

 

 

2.3

Forms of Distribution. Unless the Participant’s interest is distributed in the
form of an annuity purchased from an insurance company or in a single sum on or
before the required beginning date, as of the first distribution calendar year
distributions will be made in accordance with Articles 3 and 4 of this
Amendment. If the Participant’s interest is distributed in the form of an
annuity purchased from an insurance company, distributions thereunder will be
made in accordance with the requirements of Section 401(a)(9) of the Code and
the Treasury regulations.

ARTICLE III
REQUIRED MINIMUM DISTRIBUTIONS DURING PARTICIPANT’S LIFETIME

 

 

3.1

Amount of Required Minimum Distribution For Each Distribution Calendar Year.
During the Participant’s lifetime, the minimum amount that will be distributed
for each distribution calendar year is the lesser of:

 

 

 

(a) the quotient obtained by dividing the Participant’s account balance by the
distribution period in the Uniform Lifetime Table set forth in Section
1.401(a)(9)-9 of the Treasury regulations, using the Participant’s age as of the
Participant’s birthday in the distribution calendar year; or

 

 

 

(b) if the Participant’s sole designated beneficiary for the distribution
calendar year is the Participant’s spouse, the quotient obtained by dividing the
Participant’s account balance by the number in the Joint and Last Survivor Table
set forth in Section 1.401(a)(9)-9 of

2

--------------------------------------------------------------------------------

 

 

 

the Treasury regulations, using the Participant’s and spouse’s attained ages as
of the Participant’s and spouse’s birthdays in the distribution calendar year.

 

 

3.2

Lifetime Required Minimum Distributions Continue Through Year of Participant’s
Death. Required minimum distributions will be determined under this Article 3
beginning with the first distribution calendar year and up to and including the
distribution calendar year that includes the Participant’s date of death.

ARTICLE IV
REQUIRED MINIMUM DISTRIBUTIONS AFTER PARTICIPANT’S DEATH

 

 

 

4.1

Death On or After Date Distributions Begin.

 

 

 

 

(a) Participant Survived by Designated Beneficiary. If the Participant dies on
or after the date distributions begin and there is a designated beneficiary, the
minimum amount that will be distributed for each distribution calendar year
after the year of the Participant’s death is the quotient obtained by dividing
the Participant’s account balance by the longer of the remaining life expectancy
of the Participant or the remaining life expectancy of the Participant’s
designated beneficiary, determined as follows:

 

 

 

 

 

(1) The Participant’s remaining life expectancy is calculated using the age of
the Participant in the year of death, reduced by one for each subsequent year.

 

 

 

 

 

(2) If the Participant’s surviving spouse is the Participant’s sole designated
beneficiary, the remaining life expectancy of the surviving spouse is calculated
for each distribution calendar year after the year of the Participant’s death
using the surviving spouse’s age as of the spouse’s birthday in that year. For
distribution calendar years after the year of the surviving spouse’s death, the
remaining life expectancy of the surviving spouse is calculated using the age of
the surviving spouse as of the spouse’s birthday in the calendar year of the
spouse’s death, reduced by one for each subsequent calendar year.

 

 

 

 

 

(3) If the Participant’s surviving spouse is not the Participant’s sole
designated beneficiary, the designated beneficiary’s remaining life expectancy
is calculated using the age of the beneficiary in the year following the year of
the Participant’s death, reduced by one for each subsequent year.

 

 

 

 

(b) No Designated Beneficiary. If the Participant dies on or after the date
distributions begin and there is no designated beneficiary as of September 30 of
the year after the year of the Participant’s death, the minimum amount that will
be distributed for each distribution calendar year after the year of the
Participant’s death is the quotient obtained by dividing the Participant’s
account balance by the Participant’s remaining life expectancy calculated using
the age of the Participant in the year of death, reduced by one for each
subsequent year.

3

--------------------------------------------------------------------------------

 

 

4.2

Death Before Date Distributions Begin.

 

 

 

(a) Participant Survived by Designated Beneficiary. If the Participant dies
before the date distributions begin and there is a designated beneficiary, the
minimum amount that will be distributed for each distribution calendar year
after the year of the Participant’s death is the quotient obtained by dividing
the Participant’s account balance by the remaining life expectancy of the
Participant’s designated beneficiary, determined as provided in Section 4.1.

 

 

 

(b) No Designated Beneficiary. If the Participant dies before the date
distributions begin and there is no designated beneficiary as of September 30 of
the year following the year of the Participant’s death, distribution of the
Participant’s entire interest will be completed by December 31 of the calendar
year containing the fifth anniversary of the Participant’s death.

 

 

 

(c) Death of Surviving Spouse Before Distributions to Surviving Spouse Are
Required to Begin. If the Participant dies before the date distributions begin,
the Participant’s surviving spouse is the Participant’s sole designated
beneficiary, and the surviving spouse dies before distributions are required to
begin to the surviving spouse under Section 2.2(a), this Section 4.2 will apply
as if the surviving spouse were the Participant.

 

 

4.3

Election to Apply 5-year rule or the Life Expectancy Rule

 

 

 

(a) Participants or beneficiaries may elect on an individual basis whether the
5-year rule in Sections 2.2 of this Amendment or the life expectancy rule in 4.2
of this Amendment applies to distributions after the death of a Participant who
has a designated beneficiary. The election must be made no later than the
earlier of September 30 of the calendar year in which distribution would be
required to begin under Section 2.2 of this Amendment, or by September 30 of the
calendar year which contains the fifth anniversary of the Participant’s (or, if
applicable, surviving spouse’s) death. If neither the Participant nor
beneficiary makes an election under this paragraph, distributions will be made
in accordance with Sections 2.2 and 4.2 of this Amendment.

 

 

 

(b) A designated beneficiary who is receiving payments under the 5-year rule may
make a new election to receive payments under the life expectancy rule until
December 31, 2003, provided that all amounts that would have been required to be
distributed under the life expectancy rule for all distribution calendar years
before 2004 are distributed by the earlier of December 31, 2003 or the end of
the 5-year period.

4

--------------------------------------------------------------------------------

ARTICLE V
DEFINITIONS APPLICABLE TO THE APPLICATION OF MINIMUM DISTRIBUTIONS
REQUIRED UNDER CODE SECTION 401(a)(9)

 

 

5.1

Designated beneficiary. The individual who is designated as the Beneficiary
under the Plan and is the designated beneficiary under Section 401(a)(9) of the
Internal Revenue Code and Section 1.401(a)(9)-1, Q&A-4, of the Treasury
regulations.

 

 

5.2

Distribution calendar year. A calendar year for which a minimum distribution is
required. For distributions beginning before the Participant’s death, the first
distribution calendar year is the calendar year immediately preceding the
calendar year which contains the Participant’s required beginning date. For
distributions beginning after the Participant’s death, the first distribution
calendar year is the calendar year in which distributions are required to begin
under Section 2.2. The required minimum distribution for the Participant’s first
distribution calendar year will be made on or before the Participant’s required
beginning date. The required minimum distribution for other distribution
calendar years, including the required minimum distribution for the distribution
calendar year in which the Participant’s required beginning date occurs, will be
made on or before December 31 of that distribution calendar year.

 

 

5.3

Life expectancy. Life expectancy as computed by use of the Single Life Table in
Section 1.401(a)(9)-9 of the Treasury regulations.

 

 

5.4

Participant’s account balance. The account balance as of the last valuation date
in the calendar year immediately preceding the distribution calendar year
(valuation calendar year) increased by the amount of any contributions made and
allocated or forfeitures allocated to the account balance as of dates in the
valuation calendar year after the valuation date and decreased by distributions
made in the valuation calendar year after the valuation date. The account
balance for the valuation calendar year includes any amounts rolled over or
transferred to the Plan either in the valuation calendar year or in the
distribution calendar year if distributed or transferred in the valuation
calendar year.

 

 

5.5

Required beginning date. The date specified in the Plan when distributions under
Section 401(a)(9) of the Internal Revenue Code are required to begin.

ARTICLE VI
DEFINITIONS APPLICABLE TO COMPENSATION

 

 

6.1

Effective for Plan Years beginning after December 31, 1997, for purposes of any
definition of compensation under this Plan that includes a reference to amounts
under Section 125 of the Code, amounts under Section 125 of the Code include any
amounts not available to a Participant in cash in lieu of group health coverage
because the Participant is unable to certify that he or she has other health
coverage. An amount will be treated as an amount under Section 125 of the Code
only if the Employer does not request or collect information regarding the
Participant’s other health coverage as part of the enrollment process for the
health plan.

5

--------------------------------------------------------------------------------

This amendment has been adopted and executed this 20th day of March, 2003.

 

 

Name of Plan:

          Getty Realty Corp. Retirement and Profit Sharing Plan

 

--------------------------------------------------------------------------------

Name of Employer:

                    Getty Realty Corp.

 

--------------------------------------------------------------------------------

 

 

 

 

 

By:

  /s/ THOMAS STIRNWEIS

 

 

--------------------------------------------------------------------------------

 

 

  Thomas Stirnweis

 

 

  Corporate Controller and Treasurer

 

 

EMPLOYER

 

 

 

 

 

  /s/ THOMAS STIRNWEIS

 

 

--------------------------------------------------------------------------------

 

 

  Thomas Stirnweis

 

 

TRUSTEE

 

 

 

 

 

  /s/ RANDI YOUNG FILIP

 

 

--------------------------------------------------------------------------------

 

 

  Randi Young Filip

 

 

TRUSTEE

 

 

 

 

 

  /s/ LEO LIEBOWITZ

 

 

--------------------------------------------------------------------------------

 

 

  Leo Liebowitz

 

 

TRUSTEE

 

6

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(K) PROFIT SHARING PLAN

ADOPTION AGREEMENT FOR

MARKLEY ACTUARIAL SERVICES, INC.

NON-STANDARDIZED 401(K) PROFIT SHARING PLAN AND TRUST

The undersigned Employer adopts Markley Actuarial Services, Inc. Prototype
Non-Standardized 401(k) Profit Sharing Plan and Trust and elects the following
provisions:

CAUTION: Failure to properly fill out this Adoption Agreement may result in
disqualification of the Plan.

EMPLOYER INFORMATION

(An amendment to the Adoption Agreement is not needed solely to reflect a change
in the information in this Employer Information Section.)

 

 

 

 

1.

EMPLOYER’S NAME, ADDRESS AND TELEPHONE NUMBER

 

 

 

 

 

Name:

 

Getty Realty Corp.

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

Address:

 

125 Jericho Turnpike, Suite 103

 

 

 

--------------------------------------------------------------------------------

 

 

 

Street

 

 

 

 

 

 

 

Jericho

 

New York

 

11753

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

City

 

State

 

Zip

 

 

 

 

 

Telephone:

516-478-5403

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

2.

EMPLOYER’S TAXPAYER IDENTIFICATION NUMBER 11-3412575

--------------------------------------------------------------------------------

 

 

 

 

 

 

3.

TYPE OF ENTITY

 

 

 

 

 

 

 

a.

x

Corporation (including Tax-exempt or Non-profit Corporation)

 

 

 

 

 

 

 

b.

o

Professional Service Corporation

 

 

 

 

 

 

 

c.

o

S Corporation

 

 

 

 

 

 

 

d.

o

Limited Liability Company that is taxed as:

 

 

 

 

 

 

 

 

 

1.

o

a partnership or sole proprietorship

 

 

 

 

 

 

 

 

 

2.

o

a Corporation

 

 

 

 

 

 

 

 

 

3.

o

an S Corporation

 

 

 

 

 

 

 

e.

o

Sole Proprietorship

 

 

 

 

 

 

 

f.

o

Partnership (including Limited Liability)

 

 

 

 

 

 

 

g.

o

Other:

 

 

 

 

 

 

 

 

 

AND, the Employer is a member of (select all that apply):

 

 

 

 

 

 

 

h.

o

a controlled group

 

 

 

 

 

 

 

i.

o

an affiliated service group

 

 

 

 

4.

EMPLOYER FISCAL YEAR means the 12 consecutive month period:

 

 

 

 

 

 

 

Beginning on

 

January 1

 

(e.g., January 1st)

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

month                                       day

 

 

 

 

 

 

 

 

 

and ending on

 

December 31

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

month                                        day

 

 

PLAN INFORMATION

(An amendment to the Adoption Agreement is not needed solely to reflect a change
in the information in Questions 9. through 11.)

 

 

5.

PLAN NAME:

 

 

 

Getty Realty Corp. Retirement and Profit Sharing Plan

 

--------------------------------------------------------------------------------

(C) 2001 Markley Actuarial Services, Inc.

1

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(K) PROFIT SHARING PLAN

 

 

 

 

6.

EFFECTIVE DATE

 

 

 

 

 

a.

o

This is a new Plan effective as of ______________ (hereinafter called the
“Effective Date”).

 

 

 

 

 

b.

o

This is an amendment and restatement of a previously established qualified plan
of the Employer which was originally effective___ (hereinafter called the
“Effective Date”). The effective date of this amendment and restatement is
______________.

 

 

 

 

 

c.

x

FOR GUST RESTATEMENTS: This is an amendment and restatement of a previously
established qualified plan of the Employer to bring the Plan into compliance
with GUST (GATT, USERRA, SBJPA and TRA ‘97). The original Plan effective
February 1, 1978 (hereinafter called the “Effective Date”). Except as
___________ specifically provided in the Plan, the effective date of this
amendment and restatement is January 1, 2002.

 

 

 

 

 

 

 

(May enter a restatement date that is the first day of the current Plan Year.
The Plan contains appropriate retroactive effective dates with respect to
provisions for the appropriate laws.)

 

 

 

 

7.

PLAN YEAR means the 12 consecutive month period:

 

 

 

 

 

 

 

Beginning on

 

January 1st

 

(e.g., January 1st)

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

month                                       day

 

 

 

 

 

 

 

 

 

and ending on

 

December 31st

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

month                                       day

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXCEPT that there will be a Short Plan

 

 

 

Year:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

a.

x

N/A

 

 

 

 

 

 

 

 

 

 

 

 

 

b.

o

beginning on

 

 

 

(e.g., July 1, 2000)

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

month day, year

 

 

 

 

 

and ending on

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

month day, year

 

 

 

 

 

 

8.

VALUATION DATE means:

 

 

 

 

 

a.

x

Every day that the Trustee, any transfer agent appointed by the Trustee or the
Employer, and any stock exchange used by such agent are open for business (daily
valuation).

 

 

 

 

 

b.

o

The last day of each Plan Year.

 

 

 

 

 

c.

o

The last day of each Plan Year half (semi-annual).

 

 

 

 

 

d.

o

The last day of each Plan Year quarter.

 

 

 

 

 

e.

o

Other (specify day or dates):___________________(must be at least once each Plan
Year).

 

 

 

 

9.

PLAN NUMBER assigned by the Employer

 

 

 

 

 

a.

x

001

 

 

 

 

 

b.

o

002

 

 

 

 

 

c.

o

003

 

 

 

 

 

d.

o

Other:__________________________________________

 

 

 

 

10.

TRUSTEES:

 

 

 

 

 

a.

x

Individual Trustee(s) who serve as discretionary Trustee(s) over assets not
subject to control by a corporate Trustee.

 

 

 

 

 

Name(s)

 

Title(s)

 

Leo Liebowitz

 

Trustee

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

Randi Young Filip

 

Trustee

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

Thomas Stirnweis

 

Trustee

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

 

 

 

 

Address and Telephone number

 

 

 

 

 

1.

x

Use Employer address and telephone number.

 

2.

o

Use address and telephone number below:

 

 

 

 

 

 

 

 

 

Address:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

Street

 

 

 

 

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

 

 

City

 

State

 

Zip

 

Telephone:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

(C) 2001 Markley Actuarial Services, Inc.

2

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(K) PROFIT SHARING PLAN

 

 

 

 

 

b.

o

Corporate Trustee

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

Address:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

Street

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

 

 

City

 

State

 

Zip

 

Telephone:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

AND, the corporate Trustee shall serve as:

 

 

 

 

 

1.

o

a directed (nondiscretionary) Trustee over all Plan assets except for the
following:

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

2.

o

a discretionary Trustee over all Plan assets except for the following:

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

AND, shall a separate trust agreement be used with this Plan?

 

 

 

 

 

c.

o

Yes

 

 

 

 

 

d.

x

No

 

 

 

 

 

NOTE:

If Yes is selected, an executed copy of the trust agreement between the Trustee
and the Employer must be attached to this Plan. The Plan and trust agreement
will be read and construed together. The responsibilities, rights and powers of
the Trustee shall be those specified in the trust agreement.

 

 

 

 

11.

PLAN ADMINISTRATOR’S NAME, ADDRESS AND TELEPHONE NUMBER:
(If none is named, the Employer will become the Administrator.)

 

 

 

 

 

a.

x

Employer (Use Employer address and telephone number).

 

 

 

 

 

b.

o

Use name, address and telephone number below:

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Address:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

Street

 

 

 

 

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

 

 

City

 

State

 

Zip

 

Telephone:

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

12.

CONSTRUCTION OF PLAN

 

 

 

This Plan shall be governed by the laws of the state or commonwealth where the
Employer’s (or, in the case of a corporate Trustee, such Trustee’s) principal
place of business is located unless another state or commonwealth is specified:
New York

 

--------------------------------------------------------------------------------

ELIGIBILITY REQUIREMENTS

 

 

 

 

 

 

13.

ELIGIBLE EMPLOYEES (Plan Section 1.18)

 

 

 

 

 

 

 

FOR ALL PURPOSES OF THE PLAN (EXCEPT AS ELECTED IN d. or e. BELOW FOR EMPLOYER
CONTRIBUTIONS) means all Employees (including Leased Employees) EXCEPT:

 

 

 

 

 

 

 

NOTE:

If different exclusions apply to Elective Deferrals than to other Employer
contributions, complete this part a.-b. for the Elective Deferral component of
the Plan.

 

 

 

 

 

 

 

a.

o

N/A. No exclusions.

 

 

 

 

 

 

 

b.

x

The following are excluded, except that if b.3. is selected, such Employees will
be included (select all that apply):

 

 

 

 

 

 

 

 

 

1.

x

Union Employees (as defined in Plan Section 1.18).

 

 

 

 

 

 

 

 

 

2.

o

Non-resident aliens (as defined in Plan Section 1.18).

 

 

 

 

 

 

 

 

 

3.

o

Employees who became Employees as the result of a “Code Section 410(b)(6)(C)
transaction” (as defined in Plan Section 1.18).

 

 

 

 

 

 

 

 

 

4.

o

Salaried Employees

 

 

 

 

 

 

 

 

 

5.

o

Highly Compensated Employees

 

 

 

 

 

 

 

 

 

6.

o

Leased Employees

 

 

 

 

 

 

 

 

 

7.

o

Other:

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

HOWEVER, different exclusions will apply (select c. OR d. and/or e.):

 

 

 

 

 

 

 

c.

x

N/A. The options elected in a.-b. above apply for all purposes of the Plan.

 

 

 

 

 

 

 

d.

o

For purposes of all Employer contributions (other than Elective Deferrals and
matching contributions)...

 

 

 

 

 

 

 

e.

o

For purposes of Employer matching contributions...

(C) 2001 Markley Actuarial Services, Inc.

3

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(K) PROFIT SHARING PLAN

 

 

 

 

 

 

 

 

IF d. OR e. IS SELECTED, the following exclusions apply for such purposes
(select f. or g.):

 

 

 

f.

o

N/A. No exclusions.

 

 

 

g.

o

The following are excluded, except that if g.3. is selected, such Employees will
be included (select all that apply):

 

 

 

 

 

1.

o

Union Employees (as defined in Plan Section 1.18).

 

 

 

 

 

2.

o

Non-resident aliens (as defined in Plan Section 1.18).

 

 

 

 

 

3.

o

Employees who became Employees as the result of a “Code Section 410(b)(6)(C)
transaction” (as defined in Plan Section 1.18).

 

 

 

 

 

4.

o

Salaried Employees

 

 

 

 

 

5.

o

Highly Compensated Employees

 

 

 

 

 

6.

o

Leased Employees

 

 

 

 

 

7.

o

Other:

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

14.

THE FOLLOWING AFFILIATED EMPLOYER (Plan Section 1.6) will adopt this Plan as a
Participating Employer (if there is more than one, or if Affiliated Employers
adopt this Plan after the date the Adoption Agreement is executed, attach a list
to this Adoption Agreement of such Affiliated Employers including their names,
addresses, taxpayer identification numbers and types of entities):

 

 

 

 

NOTE:

Employees of an Affiliated Employer that does not adopt this Adoption Agreement
as a Participating Employer shall not be Eligible Employees. This Plan could
violate the Code Section 410(b) coverage rules if all Affiliated Employers do
not adopt the Plan.

 

 

 

 

 

 

 

 

a.

x

N/A

 

 

 

b.

o

Name of First Affiliated Employer:

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

Address:

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

 

 

 

 

 

Street

 

 

 

 

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

--------------------------------------------------------------------------------

 

 

 

City

 

State

 

Zip

 

 

 

 

 

 

 

 

Telephone:

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

 

Taxpayer Identification Number:

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

AND, the Affiliated Employer is:

 

 

c.

o

Corporation (including Tax-exempt, Non-profit or Professional Service
Corporation)

 

 

d.

o

S Corporation

 

 

e.

o

Limited Liability Company that is taxed as:

 

 

 

 

 

 

 

 

 

 

1.

o

a partnership or sole proprietorship

 

 

 

 

2.

o

a Corporation

 

 

 

 

3.

o

an S Corporation

 

 

f.

o

Sole Proprietorship

 

 

g.

o

Partnership (including Limited Liability)

 

 

h.

o

Other:

 

 

 

--------------------------------------------------------------------------------

 

 

 

15.

CONDITIONS OF ELIGIBILITY (Plan Section 3.1)

 

 

Any Eligible Employee will be eligible to participate in the Plan upon
satisfaction of the following:

 

 

 

 

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, unless elected in b.4. or i.4. below.

 

 

 

 

ELIGIBILITY FOR ALL PURPOSES OF THE PLAN (EXCEPT AS ELECTED IN e.-k. BELOW FOR
EMPLOYER CONTRIBUTIONS) (select a. or all that apply of b., c., and d.):

 

 

NOTE:

If different conditions apply to Elective Deferrals than to other Employer
contributions, complete this part a.-d. for the Elective Deferral component of
the Plan.

 

 

 

 

 

 

 

 

a.

o

No age or service required. (Go to e.-g. below)

 

 

b.

x

Completion of the following service requirement which is based on Years of
Service (or Periods of Service if the Elapsed Time Method is elected):

 

 

 

1.

o

No service requirement

 

 

 

 

2.

x

1/2 Year of Service or Period of Service

 

 

 

 

3.

o

1 Year of Service or Period of Service

 

      4. o __________ - (not to exceed 1,000) Hours of Service within
___________ (not to exceed 12) months from the Eligible Employee’s employment
commencement date. If an Employee does not complete the stated Hours of Service
during the specified time period, the Employee is subject to the Year of Service
requirement in b.3. above.              

 

 

 

5.

o

Other:

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

(C)

2001 Markley Actuarial Services, Inc.

4

--------------------------------------------------------------------------------

Non-Standardized 401(k) Profit Sharing Plan

 

 

 

 

 

 

 

 

 

 

(may not exceed one (1) Year of Service or Period of Service)

 

 

c.

x

Attainment of age:

 

 

 

 

1.

o

No age requirement

 

 

 

 

2.

o

20 1/2

 

 

 

 

3.

x

21

 

 

 

 

4.

o

Other: __________ (may not exceed 21)

 

 

d.

o

The service and/or age requirements specified above shall be waived with respect
to any Eligible Employee who was employed on __________ and such Eligible
Employee shall enter the Plan as of such date.

 

 

 

 

The requirements to be waived are (select one or both):

 

 

 

 

1.

o

service requirement (will let part-time Eligible Employees in Plan)

 

 

 

 

2.

o

age requirement

 

 

 

 

 

 

 

HOWEVER, DIFFERENT ELIGIBILITY CONDITIONS WILL APPLY (select e. OR f. and/or
g.):

 

 

 

 

 

 

 

e.

o

N/A. The options elected in a.-d. above apply for all purposes of the Plan.

 

 

f.

x

For purposes of all Employer contributions (other than Elective Deferrals and
matching contributions)...

 

 

g.

o

For purposes of Employer matching contributions...

 

 

If f. OR g. IS SELECTED, the following eligibility conditions apply for such
purposes:

 

 

h.

o

No age or service requirements

 

 

i.

x

Completion of the following service requirement which is based on Years of
Service (or Periods of Service if the Elapsed Time Method is elected):

 

 

 

 

1.

o

No service requirement

 

 

 

 

2.

o

1/2 Year of Service or Period of Service

 

 

 

 

3.

x

1 Year of Service or Period of Service

 

 

 

 

4.

o

_________ (not to exceed 1,000) Hours of Service within ____________ (not to
exceed 12) months from the Eligible Employee’s employment commencement date. If
an Employee does not complete the stated Hours of Service during the specified
time period, the Employee is subject to the Year of Service requirement in i.3.
above.

 

 

 

 

5.

o

1 1/2 Years of Service or Periods of Service

 

 

 

 

6.

o

2 Years of Service or Periods of Service

 

 

 

 

7.

o

Other:

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

(may not exceed two (2) Years of Service or Periods of Service)

 

 

 

 

NOTE:

If more than one (1) Year of Service is elected 100% immediate vesting is
required.

 

 

j.

x

Attainment of age:

 

 

 

 

1.

o

No age requirement

 

 

 

 

2.

o

20 1/2

 

 

 

 

3.

x

21

 

 

 

 

4.

o

Other: __________ (may not exceed 21)

 

 

k.

o

The service and/or age requirements specified above shall be waived with respect
to any Eligible Employee who was employed on and such Eligible Employee shall
enter the Plan as of such date.

 

 

 

 

The requirements to be waived are (select one or both):

 

 

 

 

1.

o

service requirement (will let part-time Eligible Employees in Plan)

 

 

 

 

2.

o

age requirement

 

 

 

 

 

 

 

 

16.

EFFECTIVE DATE OF PARTICIPATION (Plan Section 3.2)

 

 

An Eligible Employee who has satisfied the eligibility requirements will become
a Participant for all purposes of the Plan (except as elected in g.-p. below for
Employer contributions):

 

 

NOTE:

If different entry dates apply to Elective Deferrals than to other Employer
contributions, complete this part a.-f. for the Elective Deferral component of
the Plan.

 

 

a.

o

the day on which such requirements are satisfied.

 

 

b.

x

the first day of the month coinciding with or next following the date on which
such requirements are satisfied.

 

 

c.

o

the first day of the Plan Year quarter coinciding with or next following the
date on which such requirements are satisfied.

 

 

d.

o

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 such requirements are
satisfied.

 

 

e.

o

the first day of the Plan Year next following the date on which such
requirements are satisfied. (Eligibility must be 1/2 Year of Service (or Period
of Service) or less and age must be 20 1/2 or less.)

 

 

f.

o

other: ___________________________________________, provided that an Eligible
Employee who has satisfied the maximum age (21) and service requirements (one
(1) Year or Period of Service) 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.

 

 

(C)

2001 Markley Actuarial Services, Inc.

5

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(K) PROFIT SHARING PLAN

 

 

 

 

 

HOWEVER, different entry dates will apply (select g. OR h. and/or i.):

 

 

 

g.

x

N/A. The options elected in a.-f. above apply for all purposes of the Plan.

 

 

 

h.

o

For purposes of all Employer contributions (other than Elective Deferrals and
matching contributions)...

 

 

 

i.

o

For purposes of Employer matching contributions...

 

 

 

 

 

 

 

IF h. OR i. IS SELECTED, the following entry dates apply for such purposes
(select one):

 

 

 

j.

o

the first day of the month coinciding with or next following the date on which
such requirements are satisfied.

 

 

 

k.

o

the first day of the Plan Year quarter coinciding with or next following the
date on which such requirements are satisfied.

 

 

 

l.

o

the first day of the Plan Year in which such requirements are satisfied.

 

m.

o

the first day of the Plan Year in which such requirements are satisfied, if such
requirements are satisfied in the first 6 months of the Plan Year, or as of the
first day of the next succeeding Plan Year if such requirements are satisfied in
the last 6 months of the Plan Year.

 

n.

o

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 such requirements are
satisfied.

 

 

 

o.

o

the first day of the Plan Year next following the date on which such
requirements are satisfied. (Eligibility must be 1/2 (or 1 1/2 if 100% immediate
Vesting is selected) Year of Service (or Period of Service) or less and age must
be 20 1/2 or less.)

 

 

 

p.

o

other: ______________________________________________________, provided that an
Eligible Employee who has satisfied the maximum age (21) and service
requirements (one (1) Year or Period of Service (or more than one (1) year if
full and immediate vesting)) 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.

 

 

 

 

 

 

SERVICE

 

 

17.

RECOGNITION OF SERVICE WITH PREDECESSOR EMPLOYER (Plan Sections 1.57 and 1.85)

 

 

 

a.

o

No service with a predecessor Employer shall be recognized.

 

 

 

b.

x

Service with Getty Petroleum Marketing Inc. will be recognized except as follows
(select 1. or all that apply of 2. through 4.):

 

 

 

 

 

1.

x

N/A, no limitations.

 

 

 

 

 

2.

o

service will only be recognized for vesting purposes.

 

 

 

 

 

3.

o

service will only be recognized for eligibility purposes.

 

 

 

 

 

4.

o

service prior to ______________ will not be recognized.

 

 

 

 

 

NOTE:

If the predecessor Employer maintained this qualified Plan, then Years of
Service (and/or Periods of Service) with such predecessor Employer shall be
recognized pursuant to Plan Sections 1.57 and 1.85 and b.1. will apply.

 

 

 

 

 

 

18.

SERVICE CREDITING METHOD (Plan Sections 1.57 and 1.85)

 

 

 

NOTE:

If no elections are made in this Section, then the Hours of Service Method will
be used and the provisions set forth in the definition of Year of Service in
Plan Section 1.85 will apply.

 

 

 

ELAPSED TIME METHOD shall be used for the following purposes (select all that
apply):

 

 

 

a.

x

N/A. Plan only uses the Hours of Service Method.

 

 

 

b.

o

all purposes. (If selected, skip to Question 19.)

 

 

 

c.

o

eligibility to participate.

 

 

 

d.

o

vesting.

 

 

 

e.

o

sharing in allocations or contributions.

 

 

 

HOURS OF SERVICE METHOD shall be used for the following purposes (select all
that apply):

 

 

 

f.

o

N/A. Plan only uses the Elapsed Time Method.

 

 

 

g.

x

eligibility to participate in the Plan. The eligibility computation period after
the initial eligibility computation period shall...

 

 

 

 

 

1.

x

shift to the Plan Year after the initial computation period.

 

 

 

 

 

2.

o

be based on the date an Employee first performs an Hour of Service (initial
computation period) and subsequent computation periods shall be based on each
anniversary date thereof.

 

 

 

h.

x

vesting. The vesting computation period shall be...

 

 

 

 

 

1.

x

the Plan Year.

 

 

 

 

 

2.

o

the date an Employee first performs an Hour of Service and each anniversary
thereof.

 

 

 

i.

x

sharing in allocations or contributions (the computation period shall be the
Plan Year).

 

 

 

 

 

 

(C)

2001 Markley Actuarial Services, Inc.

6

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(K) PROFIT SHARING PLAN

 

 

 

 

 

AND, IF THE HOURS OF SERVICE METHOD IS BEING USED, the Hours of Service will be
determined on the basis of the method selected below. Only one method may be
selected. The method selected below will be applied to (select j. or k.):

 

 

 

j.

x

all Employees.

 

 

 

k.

o

salaried Employees only (for hourly Employees, actual Hours of Service will be
used).

 

 

 

 

 

ON THE BASIS OF:

 

 

 

l.

o

actual hours for which an Employee is paid or entitled to payment.

 

 

 

m.

o

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.

 

 

 

n.

o

weeks worked. An Employee will be credited with 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.

 

 

 

o.

o

semi-monthly payroll periods worked. 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.

 

 

 

p.

x

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.

 

 

 

AND, a Year of Service means the applicable computation period during which an
Employee has completed at least:

 

 

 

q.

x

1000 (may not be more than 1,000) Hours of Service
(if left blank, the Plan will use 1,000 Hours of Service).

 

 

 

 

VESTING

 

 

 

 

19.

VESTING OF PARTICIPANT’S INTEREST (Plan Section 6.4(b))

Vesting for Employer Contributions (except as otherwise elected in j. - q. below
for matching contributions). The vesting schedule, based on a Participant’s
Years of Service (or Periods of Service if the Elapsed Time Method is elected),
shall be as follows:

 

 

 

 

 

a.

o

100% upon entering Plan. (Required if eligibility requirement is greater than
one (1) Year of Service or Period of Service.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

b.

o

3 Year Cliff:

 

 

 

 

c.

o

5 Year Cliff:

 

 

 

 

 

 

0-2 years

 

0

%

 

 

 

0-4 years

 

0

%

 

 

 

3 years

 

100

%

 

 

 

5 years

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

d.

x

6 Year Graded:

 

 

 

 

e.

o

4 Year Graded:

 

 

 

 

 

 

0-1 year

 

0

%

 

 

 

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.

o

5 Year Graded:

 

 

 

 

g.

o

7 Year Graded:

 

 

 

 

 

 

1 year

 

20

%

 

 

 

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.

o

Other - Must be at least as liberal as either c. or g. above.

 

 

 

 

 

Service

Percentage

 

 

_____

_____

 

 

_____

_____

 

 

_____

_____

 

 

_____

_____

 

 

_____

_____

 

 

_____

_____

 

 

_____

_____

 

 

 

(C)

2001 Markley Actuarial Services, Inc.

7

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(K) PROFIT SHARING PLAN

 

 

 

 

 

 

VESTING FOR EMPLOYER MATCHING CONTRIBUTIONS

 

 

The vesting schedule for Employer matching contributions, based on a
Participant’s Years of Service (or Periods of Service if the Elapsed Time Method
is elected) shall be as follows:

 

 

i.

x

N/A. There are no matching contributions subject to a vesting schedule OR the
schedule in a.-h. above shall also apply to matching contributions.

 

 

j.

o

100% upon entering Plan. (Required if eligibility requirement is greater than
one (1) Year of Service or Period of Service.)

 

 

k.

o

3 Year Cliff

 

 

l.

o

5 Year Cliff

 

 

m.

o

6 Year Graded

 

 

n.

o

4 Year Graded

 

 

o.

o

5 Year Graded

 

 

p.

o

7 Year Graded

 

 

q.

o

Other - Must be at least as liberal as either l. or p. above.

 

 

 

 

 

Service

Percentage

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

 

 

 

 

20.

FOR AMENDED PLANS (Plan Section 5.9(g))

 

 

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, amended schedule is more favorable in all
years or prior schedule was immediate 100% vesting.

 

 

b.

o

Pre-amended schedule:

 

 

 

 

 

Service

Percentage

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

 

(C)

2001 Markley Actuarial Services, Inc.

8

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

 

21.

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 (or Periods of Service if the Elapsed Time Method is
elected), 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
before the Plan became a Top Heavy Plan and shall continue to apply if the Plan
ceases to be a Top Heavy Plan unless an amendment is made to change the vesting
schedule.

 

 

a.

x

N/A (the regular vesting schedule already satisfies one of the minimum top heavy
schedules).

 

 

b.

o

6 Year Graded:

 

 

 

0-1 year

0

 

%

 

 

 

2 years

20

 

%

 

 

 

3 years

40

 

%

 

 

 

4 years

60

 

%

 

 

 

5 years

80

 

%

 

 

 

6 years

100

 

%

 

 

c.

o

3 Year Cliff:

 

 

 

0-2 years

0

 

%

 

 

 

3 years

100

 

%

 

 

d.

o

Other - Must be at least as liberal as either b. or c. above.

 

 

 

 

 

Service

Percentage

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

______

______

 

 

 

 

 

 

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.

 

 

22.

EXCLUDED VESTING SERVICE

 

 

a.

x

No exclusions.

 

 

b.

o

Service prior to the Effective Date of the Plan or a predecessor plan.

 

 

c.

o

Service prior to the time an Employee has attained age 18.

 

 

 

 

23.

VESTING FOR DEATH AND TOTAL AND PERMANENT DISABILITY

 

 

Regardless of the vesting schedule, Participants shall become fully Vested upon
(select a. or all that apply of b. and c.)

 

 

 

 

 

a.

o

N/A. Apply vesting schedule, or all contributions to the Plan are fully Vested.

 

 

b.

x

Death.

 

 

c.

x

Total and Permanent Disability.

 

 

 

 

24.

NORMAL RETIREMENT AGE (“NRA”) (Plan Section 1.45) means the:

 

 

a.

x

date of a Participant’s 65th birthday (not to exceed 65th).

 

 

b.

o

later of a Participant’s ______ birthday (not to exceed 65th) or the ______ (not
to exceed 5th) anniversary of the first day of the Plan Year in which
participation in the Plan commenced.

 

 

 

 

25.

NORMAL RETIREMENT DATE (Plan Section 1.46) means the:

 

 

a.

o

Participant’s “NRA”.

 

 

OR (select one)

 

 

b.

x

first day of the month coinciding with or next following the Participant’s
“NRA”.

 

 

c.

o

first day of the month nearest the Participant’s “NRA”.

 

 

d.

o

Anniversary Date coinciding with or next following the Participant’s “NRA”.

 

 

e.

o

Anniversary Date nearest the Participant’s “NRA”.

 

 

 

 

26.

EARLY RETIREMENT DATE (Plan Section 1.15) means the:

 

 

a.

 o

No Early Retirement provision provided.

 

 

b.

 o

date on which a Participant...

 

 

c.

 x

first day of the month coinciding with or next following the date on which a
Participant...

 

 

d.

 o

Anniversary Date coinciding with or next following the date on which a
Participant...

 

 

 

(C)

2002

Markley Actuarial Services, Inc.

9

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

 

AND, if b., c., or d. is selected...

 

 

e.

o

attains age.

 

 

f.

x

attains age 55 and completes at least 6 Years of Service (or Periods of Service)
for vesting purposes.

 

 

 

 

 

 

 

AND, if b., c. or d. is selected, shall a Participant become fully Vested upon
attainment of the Early Retirement Date?

 

 

g.

x

Yes

 

 

h.

o

No

 

 

 

 

 

 

COMPENSATION

 

 

 

 

 

 

27.

COMPENSATION (Plan Section 1.11) with respect to any Participant means:

 

 

a.

x

Wages, tips and other compensation on Form W-2.

 

 

b.

o

Section 3401(a) wages (wages for withholding purposes).

 

 

c.

o

415 safe-harbor compensation.

 

 

 

COMPENSATION shall be based on the following determination period:

 

 

d.

x

the Plan Year.

 

 

e.

o

the Fiscal Year coinciding with or ending within the Plan Year.

 

 

f.

o

the calendar year coinciding with or ending within the Plan Year.

 

 

NOTE:

The Limitation Year for Code Section 415 purposes shall be the same as the
determination period for Compensation unless an alternative period is specified:
___________ (must be a consecutive twelve month period).

 

 

 

 

 

 

 

ADJUSTMENTS TO COMPENSATION

 

 

g.

o

N/A. No adjustments.

 

 

h.

x

Compensation shall be adjusted by: (select all that apply)

 

 

 

 

1.

x

including compensation which is not currently includible in the Participant’s
gross income by reason of the application of Code Sections 125 (cafeteria plan),
132(f)(4) (qualified transportation fringe), 402(e)(3) (401(k) plan),
402(h)(1)(B) (simplified employee pension plan), 414(h) (employer pickup
contributions under a governmental plan), 403(b) (tax sheltered annuity) or
457(b) (eligible deferred compensation plan).

 

 

 

 

2.

x

excluding reimbursements or other expense allowances, fringe benefits (cash or
non-cash), moving expenses, deferred compensation (other than deferrals
specified in 1. above) and welfare benefits.

 

 

 

 

3.

o

excluding Compensation paid during the determination period while not a
Participant in the component of the Plan for which the definition is being used.

 

 

 

 

4.

o

excluding overtime.

 

 

 

 

5.

o

excluding bonuses.

 

 

 

 

6.

o

excluding commissions.

 

 

 

 

7.

x

other: excluding reportable income from the sale, exchange or other disposition
of stock acquired under a stock option plan.

 

 

 

 

NOTE:

Options 4., 5., 6. or 7. may not be selected if an integrated allocation formula
is selected (i.e., if 33.f. is selected). In addition, if 4., 5., 6., or 7. is
selected, the definition of Compensation could violate the nondiscrimination
rules.

 

 

 

 

 

 

 

HOWEVER, FOR SALARY DEFERRAL AND MATCHING PURPOSES Compensation shall be
adjusted by (for such purposes, the Plan automatically includes Elective
Deferrals and other amounts in h.1. above):

 

 

i.

o

N/A. No adjustments or same adjustments as in above.

 

 

j.

x

Compensation shall be adjusted by: (select all that apply)

 

 

 

 

1.

x

excluding reimbursements or other expense allowances, fringe benefits (cash or
non-cash), moving expenses, deferred compensation (other than deferrals
specified in h.1. above) and welfare benefits.

 

 

 

 

2.

o

excluding Compensation paid during the determination period while not a
Participant in the component of the Plan for which the definition is being used.

 

 

 

 

3.

o

excluding overtime

 

 

 

 

4.

x

excluding bonuses

 

 

 

 

5.

o

excluding commissions

 

 

 

 

6.

x

other: excluding reportable income from the sale, exchange or other disposition
of stock acquired under a stock option plan.

 

 

(C)

2001 Markley Actuarial Services, Inc.

10

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

CONTRIBUTIONS AND ALLOCATIONS

 

 

 

 

 

 

28.

SALARY REDUCTION ARRANGEMENT - ELECTIVE DEFERRALS (Plan Section 12.2)

 

Each Participant may elect to have Compensation deferred by:

 

 

 

 

 

 

 

a.

o

%____.

 

 

 

 

 

 

 

 

b.

x

up to 50%.

 

 

 

 

 

 

 

 

c.

o

from ___% to ___%.

 

 

 

 

 

 

 

d.

o

up to the maximum percentage allowable not to exceed the limits of Code Sections
401(k), 402(g), 404 and 415.

 

 

 

 

 

 

 

AND, Participants who are Highly Compensated Employees determined as of the
beginning of a Plan Year may only elect to defer Compensation by:

 

 

 

 

 

 

 

e.

x

Same limits as specified above.

 

 

 

 

 

 

 

f.

o

The percentage equal to the deferral limit in effect under Code Section
402(g)(3) for the calendar year that begins with or within the Plan Year divided
by the annual compensation limit in effect for the Plan Year under Code Section
401(a)(17).

 

 

 

 

 

 

 

MAY PARTICIPANTS make a special salary deferral election with respect to
bonuses?

 

 

 

 

 

 

 

g.

o

No.

 

 

 

 

 

 

 

 

 

h.

x

Yes, a Participant may elect to defer up to 50% of any bonus.

 

 

 

 

 

 

 

PARTICIPANTS MAY commence salary deferrals on the effective date of
participation and on January 1 (must be at least once each calendar year).

 

 

 

 

 

 

 

 

 

Participants may modify salary deferral elections:

 

 

 

 

 

 

 

 

 

1.

x

As of each payroll period

 

 

 

 

 

 

 

 

 

2.

o

On the first day of the month

 

 

 

 

 

 

 

 

 

3.

o

On the first day of each Plan Year quarter

 

 

 

 

 

 

 

 

 

4.

o

On the first day of the Plan Year or the first day of the 7th month of the Plan
Year

 

 

 

 

 

 

 

 

 

5.

o

Other: (must be at least once each calendar year)

 

 

 

 

 

 

 

AUTOMATIC ELECTION: Shall Participants who do not affirmatively elect to receive
cash or have a specified amount contributed to the Plan automatically have
Compensation deferred?

 

 

 

 

 

 

 

i.

x

No.

 

 

 

 

 

 

 

 

 

j.

o

Yes, by ____% of Compensation.

 

 

 

 

 

 

 

SHALL THERE BE a special effective date for the salary deferral component of the
Plan?

 

 

 

 

 

 

 

k.

x

No.

 

 

 

 

 

 

 

l.

o

Yes, the effective date of the salary deferral component of the Plan is _______
(enter month day, year).

 

 

 

 

 

 

29.

SIMPLE 401(k) PLAN ELECTION (Plan Section 13.1)
Shall the simple 401(k) provisions of Article XIII apply?

 

 

 

 

 

 

 

a.

x

No. The simple 401(k) provisions will not apply.

 

 

 

 

 

 

 

b.

o

Yes. The simple 401(k) provisions will apply.

 

 

 

 

 

 

30.

401(k) SAFE HARBOR PROVISIONS (Plan Section 12.8)
Will the ADP and/or ACP test safe harbor provisions be used? (select a., b. or
c.)

 

 

 

 

 

 

 

a.

x

No. (If selected, skip to Question 31.)

 

 

 

 

 

 

 

b.

o

Yes, but only the ADP (and NOT the ACP) Test Safe Harbor

 

provisions will be used.

 

 

 

 

 

 

 

c.

o

Yes, both the ADP and ACP Test Safe Harbor provisions will be used.

 

 

 

 

 

 

 

 

 

IF c. is selected, does the Plan permit matching contributions in addition to
any safe harbor contributions elected in d. or e. below?

 

 

 

 

 

 

 

 

 

1.

o

No or N/A. Any matching contributions, other than any Safe Harbor Matching
Contributions elected in d. below, will be suspended in any Plan Year in which
the safe harbor provisions are used.

 

 

 

 

 

 

 

 

 

2.

o

Yes, the Employer may make matching contributions in addition to any Safe Harbor
Matching contributions elected in d. below. (If elected, complete the provisions
of the Adoption Agreement relating to matching contributions (i.e., Questions
31. and 32.) that will apply in addition to any elections made in d. below.
NOTE: Regardless of any election made in Question31., the Plan automatically
provides that only Elective Deferrals up to 6% of Compensation are taken into
account in applying the match set forth in that Question and that the maximum
discretionary matching contribution that may be made on behalf of any
Participant is 4% of Compensation.)

(C) 2001 Markley Actuarial Services, Inc.

11

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

THE EMPLOYER WILL MAKE THE FOLLOWING ADP TEST SAFE HARBOR CONTRIBUTION FOR THE
PLAN YEAR:

 

 

NOTE:

The ACP Test Safe Harbor is automatically satisfied if the only matching
contribution made to the Plan is either (1) a Basic Matching Contribution or (2)
an Enhanced Matching Contribution that does not provide a match on Elective
Deferrals in excess of 6% of Compensation.

 

 

 

 

 

 

 

 

 

d.

o

Safe Harbor Matching Contribution (select 1. or 2. AND 3.)

 

 

 

 

 

 

 

 

 

 

 

1.

o

Basic Matching Contribution. The Employer will make Matching Contributions to
the account of each “Eligible Participant” in an amount equal to the sum of 100%
of the amount of the Participant’s Elective Deferrals that do not exceed 3% of
the Participant’s Compensation, plus 50% of the amount of the Participant’s
Elective Deferrals that exceed 3% of the Participant’s Compensation but do not
exceed 5% of the Participant’s Compensation.

 

 

 

 

 

 

 

 

 

 

 

2.

o

Enhanced Matching Contribution. The Employer will make Matching Contributions to
the account of each “Eligible Participant” in an amount equal to the sum of:

 

 

 

 

 

 

 

 

 

 

 

 

 

a.

o

___% (may not be less than 100%) of the Participant’s Elective Deferrals that do
not exceed ___% (if over 6% or if left blank, the ACP test will still apply) of
the Participant’s Compensation, plus

 

 

 

 

 

 

 

 

 

 

 

 

 

b.

o

___% of the Participant’s Elective Deferrals that exceed ___% of the
Participant’s Compensation but do not exceed ___% (if over 6% or if left blank,
the ACP test will still apply) of the Participant’s Compensation.

 

 

 

 

 

 

 

 

 

 

 

 

 

NOTE:

a. and b. must be completed so that, at any rate of Elective Deferrals, the
matching contribution is at least equal to the matching contribution receivable
if the Employer were making Basic Matching Contributions, but the rate of match
cannot increase as deferrals increase. For example, if a. is completed to
provide a match equal to 100% of deferrals up to 4% of Compensation, then b.
need not be completed.

 

 

 

 

 

 

 

 

 

 

 

3.

o

The safe harbor matching contribution will be determined on the following basis
(and Compensation for such purpose will be based on the applicable period):

 

 

 

 

 

 

 

 

 

 

 

 

 

a.

o

the entire Plan Year.

 

 

 

 

 

 

 

 

 

 

 

 

 

b.

o

each payroll period.

 

 

 

 

 

 

 

 

 

 

 

 

 

c.

o

all payroll periods ending with or within each month.

 

 

 

 

 

 

 

 

 

 

 

 

 

d.

o

all payroll periods ending with or within the Plan Year quarter.

 

 

 

 

 

 

 

 

 

e.

o

Nonelective Safe Harbor Contributions (select one)

 

 

 

 

 

 

 

 

 

 

 

1.

o

The Employer will make a Safe Harbor Nonelective Contribution to the account of
each “Eligible Participant” in an amount equal to ___% (may not be less than 3%)
of the Employee’s Compensation for the Plan Year.

 

 

 

 

 

 

 

 

 

 

 

2.

o

The Employer will make a Safe Harbor Nonelective Contribution to another defined
contribution plan maintained by the Employer (specify the name of the other
plan): ___.

 

 

 

 

 

 

 

 

 

FOR PURPOSES OF THE ADP Test Safe Harbor contribution, the term “Eligible
Participant” means any Participant who is eligible to make Elective Deferrals
with the following exclusions:

 

 

 

 

 

 

 

 

 

f.

o

Highly Compensated Employees.

 

 

 

 

 

 

 

 

 

g.

o

Employees who have not satisfied the greatest minimum age and service conditions
permitted under Code Section 410(a).

 

 

 

 

 

 

 

 

 

h.

o

Other: ____________________________________________________________

 

 

 

(must be a category that could be excluded under the permissive or mandatory
disaggregation rules of Regulations 1.401(k)-1(b)(3) and 1.401(m)-1(b)(3)).

 

 

 

 

 

 

 

 

SPECIAL EFFECTIVE DATE OF ADP AND ACP TEST SAFE HARBOR PROVISIONS

 

 

 

 

 

 

 

 

 

i.

o

N/A. The safe harbor provisions are effective as of the later of the Effective
Date of this Plan or, if this is an amendment or restatement, the effective date
of the amendment or restatement.

 

 

 

 

 

 

 

 

 

j.

o

The ADP and ACP Test Safe Harbor provisions are effective for the Plan Year
beginning:

 

 

 

__________________________________ (enter the first day of the Plan Year for
which the provisions are (or, for GUST updates, were) effective and, if
necessary, enter any other special effective dates that apply with respect to
the provisions).

(C) 2001 Markley Actuarial Services, Inc.

12

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

31.

FORMULA FOR DETERMINING EMPLOYER MATCHING CONTRIBUTIONS (Plan Section
12.1(a)(2))

 

 

 

 

 

 

 

NOTE:

 

Regardless of any election below, if the ACP test safe harbor is being used
(i.e., Question 30.c. is selected), then the Plan automatically provides that
only Elective Deferrals up to 6% of Compensation are taken into account in
applying the match set forth below and that the maximum discretionary matching
contribution that may be made on behalf of any Participant is 4% of
Compensation.

 

 

 

 

 

 

 

a.

o

N/A. There will not be any matching contributions (Skip to Question 33).

 

 

 

 

 

 

 

b.

x

The Employer... (select 1. or 2.)

 

 

 

 

 

 

 

 

 

1.

o

may make matching contributions equal to a discretionary percentage, to be
determined by the Employer, of the Participant’s Elective Deferrals.

 

 

 

 

 

 

 

 

 

2.

x

will make matching contributions equal to 50% (e.g., 50) of the Participant’s
Elective Deferrals, plus:

 

 

 

 

 

 

 

 

 

a.

x

N/A.

 

 

 

 

 

 

 

 

 

b.

o

an additional discretionary percentage, to be determined by the Employer.

 

 

 

 

 

 

 

 

 

AND, in determining the matching contribution above, only Elective Deferrals up
to the percentage or dollar amount specified below will be matched: (select 3.
and/or 4. OR 5.)

 

 

 

 

 

 

 

 

 

3.

x

6% of a Participant’s Compensation.

 

 

 

 

 

 

 

 

 

4.

o

$___.

 

 

 

 

 

 

 

 

 

5.

o

a discretionary percentage of a Participant’s Compensation or a discretionary
dollar amount, the percentage or dollar amount to be determined by the Employer
on a uniform basis to all Participants.

 

 

 

 

 

 

 

c.

o

The Employer may make matching contributions equal to a discretionary
percentage, to be determined by the Employer, of each tier, to be determined by
the Employer, of the Participant’s Elective Deferrals.

 

 

 

 

 

 

 

d.

o

The Employer will make matching contributions equal to the sum of ___ % of the
portion of the Participant’s Elective Deferrals which do not exceed ___ % of the
Participant’s Compensation or $___ plus ___ % of the portion of the
Participant’s Elective Deferrals which exceed ___ % of the Participant’s
Compensation or $ ___, but does not exceed ___ % of the Participant’s
Compensation or $ ___.

 

 

 

 

 

 

 

NOTE:

If c. or d. above is elected, the Plan may violate the Code Section 401(a)(4)
nondiscrimination requirements if the rate of matching contributions increases
as a Participant’s Elective Deferrals or Years of Service (or Periods of
Service) increase.

 

 

 

 

 

 

 

PERIOD OF DETERMINING MATCHING CONTRIBUTIONS

 

 

 

 

 

 

 

Matching contributions will be determined on the following basis (and any
Compensation or dollar limitation used in determining the match will be based on
the applicable period):

 

 

 

 

 

 

 

e.

x

the entire Plan Year.

 

 

 

 

 

f.

o

each payroll period.

 

 

 

 

 

g.

o

all payroll periods ending within each month.

 

 

 

 

 

h.

o

all payroll periods ending with or within the Plan Year quarter.

 

 

 

 

 

 

 

THE MATCHING CONTRIBUTION MADE ON BEHALF OF ANY PARTICIPANT for any Plan Year
will not exceed:

 

 

 

 

 

 

 

i.

x

N/A.

 

 

 

 

 

 

 

 

j.

o

$___.

 

 

 

 

 

 

 

 

MATCHING CONTRIBUTIONS WILL BE MADE ON BEHALF OF:

 

 

 

 

 

 

 

k.

x

all Participants.

 

 

 

 

 

 

 

l.

o

only Non-Highly Compensated Employees.

 

 

 

 

 

 

 

SHALL THE MATCHING CONTRIBUTIONS BE QUALIFIED MATCHING CONTRIBUTIONS?

 

 

 

 

 

 

 

m.

o

Yes. If elected, ALL matching contributions will be fully Vested and will be
subject to restrictions on withdrawals. In addition, Qualified Matching
Contributions may be used in either the ADP or ACP test.

 

 

 

 

 

 

 

n.

x

No.

 

 

 

 

 

 

 

 

32.

ONLY PARTICIPANTS WHO SATISFY THE FOLLOWING CONDITIONS WILL BE ELIGIBLE TO SHARE
IN THE ALLOCATION OF MATCHING CONTRIBUTIONS:

 

 

 

 

 

 

 

REQUIREMENTS FOR PARTICIPANTS WHO ARE ACTIVELY EMPLOYED AT THE END OF THE PLAN
YEAR.

 

 

 

 

 

 

 

a.

o

N/A.

 

 

 

 

 

 

 

b.

x

No service requirement.

 

 

 

 

 

 

 

c.

o

A Participant must complete a Year of Service (or Period of Service if the
Elapsed Time Method is elected). (Could cause Plan to violate coverage
requirements under Code Section 410(b).)

 

 

 

 

 

 

 

d.

o

A Participant must complete at least (may not be more than 1,000) Hours of
Service during the Plan Year. (Could cause the Plan to violate coverage
requirements under Code Section410(b).)

(C) 2001 Markley Actuarial Services, Inc.

13

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

 

 

 

REQUIREMENTS FOR PARTICIPANTS WHO ARE NOT ACTIVELY EMPLOYED AT THE END OF THE
PLAN YEAR
(except as otherwise provided in i. through k. below).

 

 

 

 

 

 

 

e.

o

A Participant must complete more than ___ Hours of Service (not more than 500)
(or ___ months of service (not more than three (3)) if the Elapsed Time Method
is elected).

 

 

 

 

 

 

 

f.

o

A Participant must complete a Year of Service (or Period of Service if the
Elapsed Time Method is elected). (Could cause the Plan to violate coverage
requirements under Code Section 410(b).)

 

 

 

 

 

 

 

g.

o

Participants will NOT share in such allocations, regardless of service. (Could
cause the Plan to violate coverage requirements under Code Section 410(b).)

 

 

 

 

 

 

 

h.

x

Participants will share in such allocations, regardless of service.

 

 

 

 

 

 

 

 

 

 

 

 

 

PARTICIPANTS WHO ARE NOT ACTIVELY EMPLOYED AT THE END OF THE PLAN YEAR due to
the following shall be eligible to share in the allocation of matching
contributions regardless of the above conditions (select all that apply):

 

 

 

 

 

 

 

i.

x

Death.

 

 

 

 

 

 

 

j.

x

Total and Permanent Disability.

 

 

 

 

 

 

 

k.

x

Early or Normal Retirement.

 

 

 

 

 

 

 

AND, if 32.c., d., f., or g. is selected, shall the 410(b) ratio percentage fail
safe provisions apply (Plan Section 12.3(f))?

 

 

 

 

 

 

 

l.

x

No or N/A.

 

 

 

 

 

 

 

m.

o

Yes (If selected, the Plan must satisfy the ratio percentage test of Code
Section 410(b).)

 

 

 

 

 

 

 

 

 

 

 

 

33.

FORMULA FOR DETERMINING EMPLOYER’S PROFIT SHARING CONTRIBUTION (Plan Section
12.1(a)(3)) (d. may be selected in addition to b. or c.)

 

 

 

 

 

 

 

a.

o

N/A. No Employer Profit Sharing Contributions may be made (other than top heavy
minimum contributions) (Skip to Question 34.)

 

 

 

 

 

 

 

b.

x

Discretionary, to be determined by the Employer, not limited to current or
accumulated Net Profits.

 

 

 

 

 

 

 

c.

o

Discretionary, to be determined by the Employer, out of current or accumulated
Net Profits.

 

 

 

 

 

 

 

d.

o

Prevailing Wage Contribution. The Employer will make a Prevailing Wage
Contribution on behalf of each Participant who performs services subject to the
Service Contract Act, Davis-Bacon Act or similar Federal, State, or Municipal
Prevailing Wage statutes. The Prevailing Wage Contribution shall be an amount
equal to the balance of the fringe benefit payment for health and welfare for
each Participant (after deducting the cost of cash differential payments for the
Participant) based on the hourly contribution rate for the Participant’s
employment classification, as designated on Schedule A as attached to this
Adoption Agreement. Notwithstanding anything in the Plan to the contrary, the
Prevailing Wage Contribution shall be fully Vested. Furthermore, the Prevailing
Wage Contribution shall not be subject to any age or service requirements set
forth in Question 15. nor to any service or employment conditions set forth in
Question 35.

 

 

 

 

 

 

 

 

 

AND, if d. is selected, is the Prevailing Wage Contribution considered a
Qualified Non-Elective Contribution?

 

 

 

 

 

 

 

 

 

1.

o

Yes.

 

 

 

 

 

 

 

 

 

2.

o

No.

 

 

 

 

 

 

 

 

 

AND, if d. is selected, shall the amounts allocated on behalf of a Participant
for a Plan Year pursuant to e. or f. below be reduced (offset) by the Prevailing
Wage Contribution made on behalf of such Participant for the Plan Year under
this Plan?

 

 

 

 

 

 

 

 

 

3.

o

No (If selected, then the Prevailing Wage Contribution will be added to amounts
allocated pursuant to e. or f. below.)

 

 

 

 

 

 

 

 

 

4.

o

Yes.

 

 

 

 

 

 

 

CONTRIBUTION ALLOCATIONS

 

 

 

 

 

 

 

If b. or c. above is selected, the Employer’s discretionary profit sharing
contribution for a Plan Year will be allocated as follows:

 

 

 

 

 

 

 

e.

o

NON-INTEGRATED ALLOCATION

 

 

 

 

 

 

 

 

 

1.

o

In the same ratio as each Participant’s Compensation bears to the total of such
Compensation of all Participants.

 

 

 

 

 

 

 

 

 

2.

o

In the same dollar amount to all Participants (per capita).

 

 

 

 

 

 

 

 

 

3.

o

In the same dollar amount per Hour of Service completed by each Participant.

 

 

 

 

 

 

 

 

 

4.

o

In the same proportion that each Participant’s points bears to the total of such
points of all Participants. A Participant’s points with respect to any Plan Year
shall be computed as follows (select all that apply):

 

 

 

 

 

 

 

 

 

 

 

 

 

a.

o

___ point (s) shall be allocated for each Year of Service (or Period of Service
if the Elapsed Time Method is elected). However, the maximum Years of Service
(or Periods

(C) 2001 Markley Actuarial Services, Inc.

14

--------------------------------------------------------------------------------

NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

of Service) taken into account shall not exceed____ (leave blank if no limit on
service applies).

 

 

 

 

 

 

 

 

 

 

 

 

 

b.

o

____ point (s) shall be allocated for each full $___ (may not exceed $200) of
Compensation.

 

 

 

 

 

 

 

 

 

 

 

 

 

c.

o

____ point (s) shall be allocated for each year of age as of the end of the Plan
Year.

 

 

 

 

 

 

 

 

 

f.

x

INTEGRATED ALLOCATION

 

 

 

In accordance with Plan Section 4.3(b)(2) based on a Participant’s Compensation
in excess of:

 

 

 

 

 

 

 

 

 

 

 

1.

x

The Taxable Wage Base.

 

 

 

 

 

 

 

 

 

 

 

2.

o

____ % (not to exceed 100%) of the Taxable Wage Base. (See Note below)

 

 

 

 

 

 

 

 

 

 

 

3.

o

80% of the Taxable Wage Base plus $1.00.

 

 

 

 

 

 

 

 

 

 

 

4.

o

$____ (not greater than the Taxable Wage Base). (See Note below)

 

 

 

 

 

 

 

 

 

 

 

NOTE:

The integration percentage of 5.7% shall be reduced to:

 

 

 

 

 

 

 

 

 

 

 

 

 

1.

4.3% if 2. or 4. above is more than 20% and less than or equal to 80% of the
Taxable Wage Base.

 

 

 

 

 

 

 

 

 

 

 

 

 

2.

5.4% if 3. is elected or if 2. or 4. above is more than 80% of the Taxable Wage
Base.

 

 

 

 

 

 

 

 

34.

QUALIFIED NON-ELECTIVE CONTRIBUTIONS (Plan Section 12.1(a)(4))

 

 

NOTE: Regardless of any election made in this Question, the Plan automatically
permits Qualified Non-Elective Contributions to correct a failed ADP or ACP
test.

 

 

 

 

 

 

 

 

 

a.

x

N/A. There will be no additional Qualified Non-Elective Contributions except as
otherwise provided in the Plan.

 

 

 

 

 

 

 

 

 

b.

o

The Employer will make a Qualified Non-Elective Contribution equal to ___ % of
the total Compensation of those Participants eligible to share in the
allocations.

 

 

 

 

 

 

 

 

 

c.

o

The Employer may make a Qualified Non-Elective Contribution in an amount to be
determined by the Employer, to be allocated in proportion to the Compensation of
those Participants eligible to share in the allocations.

 

 

 

 

 

 

 

 

 

d.

o

The Employer may make a Qualified Non-Elective Contribution in an amount to be
determined by the Employer, to be allocated equally to all Participants eligible
to share in the allocations (per capita).

 

 

 

 

 

 

 

 

 

AND, if b., c., or d. is selected, the Qualified Non-Elective Contributions
above will be made on behalf of:

 

 

 

 

 

 

 

 

 

e.

o

all Participants.

 

 

 

 

 

 

 

 

 

f.

o

only Non-Highly Compensated Employees.

 

 

 

 

 

 

 

 

35.

REQUIREMENTS TO SHARE IN ALLOCATIONS OF EMPLOYER DISCRETIONARY PROFIT SHARING
CONTRIBUTION, QUALIFIED NON-ELECTIVE CONTRIBUTIONS (other than Qualified
Non-Elective Contributions under Plan Sections 12.5(c) and 12.7(g)) AND
FORFEITURES

 

 

 

 

 

 

 

 

 

a.

o

N/A. Plan does not permit such contributions.

 

 

 

 

 

 

 

 

 

b.

x

Requirements for Participants who are actively employed at the end of the Plan
Year.

 

 

 

 

 

 

 

 

 

 

 

1.

o

No service requirement.

 

 

 

 

 

 

 

 

 

 

 

2.

o

A Participant must complete a Year of Service (or Period of Service if the
Elapsed Time Method is elected). (Could cause Plan to violate coverage
requirements under Code Section 410(b).)

 

 

 

 

 

 

 

 

 

 

 

3.

x

A Participant must complete at least 1000 (may not be more than 1,000) Hours of
Service during the Plan Year. (Could cause the Plan to violate coverage
requirements under Code Section 410(b).)

 

 

 

 

 

 

 

 

 

REQUIREMENTS FOR PARTICIPANTS WHO ARE NOT ACTIVELY EMPLOYED AT THE END OF THE
PLAN YEAR (except as otherwise provided in g. through i. below).

 

 

 

 

 

 

 

 

 

c.

o

A Participant must complete more than ___ Hours of Service (not than 500)(or___
months of service (not more than three (3)) if the more Elapsed Time Method is
elected).

 

 

 

 

 

 

 

 

 

d.

o

A Participant must complete a Year of Service (or Period of Service if the
Elapsed Time Method is elected). (Could cause Plan to violate coverage
requirements under Code Section 410(b).)

 

 

 

 

 

 

 

 

 

e.

x

Participants will NOT share in such allocations, regardless of service. (Could
cause Plan to violate coverage requirements under Code Section 410(b).)

 

 

 

 

 

 

 

 

 

f.

o

Participants will share in such allocations, regardless of service.

 

 

 

 

 

 

 

 

 

PARTICIPANTS WHO ARE NOT ACTIVELY EMPLOYED AT THE END OF THE PLAN YEAR due to
the following will be eligible to share in the allocations regardless of the
above conditions (select all that apply):

 

 

 

 

 

 

 

 

 

g.

x

Death.

 

 

 

 

 

 

 

 

 

h.

x

Total and Permanent Disability.

 

 

 

 

 

 

 

 

 

i.

x

Early or Normal Retirement.

 

 

 

 

 

 

 

 

 

AND, if 35.b.2, b.3, d. or e. is selected, shall the 410(b) ratio percentage
fail safe provisions apply (Plan Section 12.3(f))?

 

 

 

 

 

 

 

 

 

j.

x

No or N/A.

 

 

 

 

 

 

 

 

 

 

 

k.

o

Yes (If selected, the Plan must satisfy the ratio percentage test of Code
Section 410(b)).

 

(C) 2002 Markley Actuarial Services, Inc.

15

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NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

36.

FORFEITURES (Plan Sections 1.27 and 4.3(e))

 

 

 

 

 

Except as provided in Plan Section 1.27, a Forfeiture will occur (if no election
is made, a. will apply):

 

 

 

 

 

a.

x

as of the earlier of (1) the last day of the Plan Year in which the Former
Participant incurs five (5) consecutive 1-Year Breaks in Service, or (2) the
distribution of the entire Vested portion of the Participant’s Account.

 

 

 

 

 

b.

o

as of the last day of the Plan Year in which the Former Participant incurs five
(5) consecutive 1-Year Breaks in Service.

 

 

 

 

 

Will Forfeitures first be used to pay any administrative expenses?

 

 

 

 

 

c.

x

Yes.

 

 

 

 

 

d.

o

No.

 

 

 

 

 

AND, EXCEPT as otherwise provided below with respect to Forfeitures attributable
to matching contributions, any remaining Forfeitures will be...

 

 

 

 

 

e.

o

added to any Employer discretionary contribution.

 

 

 

 

 

f.

x

used to reduce any Employer contribution.

 

 

 

 

 

g.

o

added to any Employer matching contribution and allocated as an additional
matching contribution.

 

 

 

 

 

h.

o

allocated to all Participants eligible to share in the allocations in the same
proportion that each Participant’s Compensation for the Plan Year bears to the
Compensation of all Participants for such year.

 

 

 

 

 

FORFEITURES OF MATCHING CONTRIBUTIONS WILL BE...

 

 

 

 

 

i.

o

N/A. Same as above or no matching contributions.

 

 

 

 

 

j.

x

used to reduce the Employer’s matching contribution.

 

 

 

 

 

k.

o

added to any Employer matching contribution and allocated as an additional
matching contribution.

 

 

 

 

 

l.

o

added to any Employer discretionary profit sharing contribution.

 

 

 

 

 

m.

o

allocated to all Participants eligible to share in the matching allocations
(regardless of whether a Participant elected any salary reductions) in
proportion to each such Participant’s Compensation for the year.

 

 

 

 

 

n.

o

allocated to all Non-Highly Compensated Employees eligible to share in the
matching allocations (regardless of whether a Participant elected any salary
reductions) in proportion to each such Participant’s Compensation for the year.

 

 

 

 

37.

ALLOCATIONS OF EARNINGS (Plan Section 4.3(c))

 

 

Allocations of earnings with respect to amounts which are not subject to
Participant directed investments and which are contributed to the Plan after the
previous Valuation Date will be determined...

 

 

 

 

 

a.

x

N/A. All assets in the Plan are subject to Participant investment direction.

 

 

 

 

 

b.

o

by using a weighted average based on the amount of time that has passed between
the date a contribution or distribution was made and the date of the prior
Valuation Date.

 

 

 

 

 

c.

o

by treating one-half of all such contributions as being a part of the
Participant’s nonsegregated account balance as of the previous Valuation Date.

 

 

 

 

 

d.

o

by using the method specified in Plan Section 4.3(c) (balance forward method).

 

 

 

 

 

e.

o

other: ____ (must be a definite predetermined formula that is not based on
Compensation and that satisfies the nondiscrimination requirements of Regulation
1.401(a)(4)-4 and is applied uniformly to all Participants).

 

 

 

 

38.

LIMITATIONS ON ALLOCATIONS (Plan Section 4.4)

 

 

 

 

 

If any Participant is covered under another qualified defined contribution plan
maintained by the Employer, other than a Master or Prototype Plan, 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(l)(2), under which
amounts are treated as Annual Additions with respect to any Participant in this
Plan:

 

 

 

 

 

a.

x

N/A. The Employer does not maintain another qualified defined contribution plan.

 

 

 

 

 

b.

o

The provisions of Plan Section 4.4(b) will apply as if the other plan were a
Master or Prototype Plan.

 

 

 

 

 

c.

o

Specify the method under which the plans will limit total Annual Additions to
the Maximum Permissible Amount, and will properly reduce any Excess Amounts, in
a manner that precludes Employer discretion:

(C) 2002 Markley Actuarial Services, Inc.

16

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NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

 

 

 

 

 

 

DISTRIBUTIONS

 

 

 

 

 

 

39.

FORM OF DISTRIBUTIONS (Plan Sections 6.5 and 6.6)

 

 

Distributions under the Plan may be made in (select all that apply)...

 

 

 

 

 

 

a.

x

lump-sums.

 

 

 

 

 

 

b.

x

substantially equal installments.

 

 

 

 

 

c.

o

partial withdrawals provided the minimum withdrawal is $____.

 

 

 

 

 

 

AND, pursuant to Plan Section 6.12,

 

 

 

 

 

 

d.

x

no annuities are allowed (Plan Section 6.12(b) will apply and the joint and
survivor rules of Code Sections 401(a)(11) and 417 will not apply to the Plan).

 

 

 

 

 

 

 

 

AND, if this is an amendment that is eliminating annuities, then an annuity form
of payment is not available with respect to distributions that have an Annuity
Starting Date beginning on or after:

 

 

 

 

 

 

 

 

 

1.

o

N/A

 

 

 

 

 

 

 

 

 

2.

x

January 1, 2002 (may not be a retroactive date), except that regardless of the
date entered, the amendment will not be effective prior to the time set forth in
Plan Section 8.1(e).

 

 

 

 

 

 

 

e.

o

annuities are allowed as the normal form of distribution (Plan Section 6.12 will
not apply and the joint and survivor rules of Code Sections 401(a)(11) and 417
will automatically apply). If elected, the Pre-Retirement Survivor Annuity
(minimum spouse’s death benefit) will be equal to:

 

 

 

 

 

 

 

 

 

1.

o

100% of Participant’s interest in the Plan.

 

 

 

 

 

 

 

 

 

2.

o

50% of Participant’s interest in the Plan.

 

 

 

 

 

 

 

 

 

3.

o

____ % (may not be less than 50%) of a Participant’s interest in the Plan.

 

 

 

 

 

 

 

 

 

AND, the normal form of the Qualified Joint and Survivor Annuity will be a joint
and 50% survivor annuity unless otherwise elected below:

 

 

 

 

 

 

 

 

 

4.

o

N/A.

 

 

 

 

 

 

 

 

 

5.

o

Joint and 100% survivor annuity.

 

 

 

 

 

 

 

 

 

6.

o

Joint and 75% survivor annuity.

 

 

 

 

 

 

 

 

 

7.

 

Joint and 66 2/3% survivor annuity.

 

 

 

 

 

 

 

NOTE:

 

If only a portion of the Plan assets may be distributed in an annuity form of
payment, then select d. AND e. and the assets subject to the joint and survivor
annuity provisions will be those assets attributable to (specify): ____ (e.g.,
the money purchase pension plan that was merged into this Plan).

 

 

 

 

 

 

 

AND, distributions may be made in...

 

 

 

 

 

 

 

f.

o

cash only (except for insurance or annuity contracts).

 

 

 

 

 

 

 

g.

x

cash or property.

 

 

 

 

 

 

40.

CONDITIONS FOR DISTRIBUTIONS UPON TERMINATION OF EMPLOYMENT

 

 

 

 

 

 

 

Distributions upon termination of employment pursuant to Plan Section 6.4 (a) of
the Plan will not be made unless the following conditions have been satisfied:

 

 

 

 

 

 

 

a.

o

No distributions may be made until a Participant has reached Early or Normal
Retirement Date.

 

 

 

 

 

 

 

b.

x

Distributions may be made as soon as administratively feasible at the
Participant’s election.

 

 

 

 

 

 

c.

o

The Participant has incurred 1-Year Break(s) in Service (or Period(s) of
Severance if the Elapsed Time Method is elected).

 

 

 

 

 

 

d.

o

Distributions may be made at the Participant’s election as soon as
administratively feasible after the Plan Year coincident with or next following
termination of employment.

 

 

 

 

 

 

e.

o

Distributions may be made at the Participant’s election as soon as
administratively feasible after the Plan Year quarter coincident with or next
following termination of employment.

 

 

 

 

 

 

f.

o

Distributions may be made at the Participant’s election as soon as
administratively feasible after the Valuation Date coincident with or next
following termination of employment.

 

 

 

 

 

 

g.

o

Distributions may be made at the Participant’s election as soon as
administratively feasible___ months following termination of employment.

 

 

 

 

 

 

h.

o

Other:
__________________________________________________________________________

 

 

 

(must be objective conditions which are ascertainable and are not subject to
Employer discretion except as otherwise permitted in Regulation 1.411(d)-4 and
may not exceed the limits of Code Section 401(a)(14) as set forth in Plan
Section 6.7).

 

 

 

 

 

41.

INVOLUNTARY DISTRIBUTIONS

 

 

 

 

 

 

Will involuntary distributions of amounts less than $5,000 be made in accordance
with the provisions of Sections 6.4, 6.5 and 6.6?

 

 

 

 

 

 

a.

x

Yes

 

 

 

 

 

 

 

b.

o

No

 

(C) 2002 Markley Actuarial Services, Inc.

17

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NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

 

 

42.

MINIMUM DISTRIBUTION TRANSITIONAL RULES (Plan Section 6.5(e))

 

 

 

 

 

 

 

 

 

NOTE:

This Section does not apply to (1) a new Plan or (2) an amendment or restatement
of an existing Plan that never contained the provisions of Code Section
401(a)(9) as in effect prior to the amendments made by the Small Business Job
Protection Act of 1996 (SBJPA).

 

 

 

 

 

 

 

 

 

The “required beginning date” for a Participant who is not a “five percent (5%)
owner” is:

 

 

 

 

 

 

 

 

 

a.

o

N/A. (This is a new Plan or this Plan has never included the pre-SBJPA
provisions.)

 

 

 

 

 

 

 

 

 

b.

o

April 1st of the calendar year following the year in which the Participant
attains age 70 1/2. (The pre-SBJPA rules will continue to apply.)

 

 

 

 

 

 

 

 

 

c.

x

April 1st of the calendar year following the later of the year in which the
Participant attains age 70 1/2 or retires (the post-SBJPA rules), with the
following exceptions (select one or both and if no election is made, both will
apply effective as of January 1, 1996):

 

 

 

 

 

 

 

 

 

 

 

1.

o

A Participant who was already receiving required minimum distributions under the
pre-SBJPA rules as of __ (not earlier than January 1, 1996) may elect to stop
receiving distributions and have them recommence in accordance with the
post-SBJPA rules. Upon the recommencement of distributions, if the Plan permits
annuities as a form of distribution then the following will apply:

 

 

 

 

 

 

 

 

 

 

 

 

 

a.

o

N/A. Annuity distributions are not permitted.

 

 

 

 

 

 

 

 

 

 

 

 

 

b.

o

Upon the recommencement of distributions, the original Annuity Starting Date
will be retained.

 

 

 

 

 

 

 

 

 

 

 

 

 

c.

o

Upon the recommencement of distributions, a new Annuity Starting Date is
created.

 

 

 

 

 

 

 

 

 

 

 

2.

x

A Participant who had not begun receiving required minimum distributions as of
December 31, 1996 (not earlier than January 1, 1996) may elect to defer
commencement of distributions until retirement. The option to defer the
commencement of distributions (i.e., to elect to receive in-___service
distributions upon attainment of age 70 1/2) will apply to all such Participants
unless the option below is elected:

 

 

 

 

 

 

 

 

 

 

 

 

 

a.

x

N/A.

 

 

 

 

 

 

 

 

 

 

 

 

 

b.

o

The in-service distribution option is eliminated with respect to Participants
who attain age 70 1/2 in or after the calendar year that begins after the later
of (1) December 31, 1998, or (2) the adoption date of the amendment and
restatement to bring the Plan into compliance with SBJPA. (This option may only
be elected if the amendment to eliminate the in- service distribution is adopted
no later than the last day of the remedial amendment period that applies to the
Plan for changes under SBJPA.)

 

 

 

 

 

 

 

 

43.

DISTRIBUTIONS UPON DEATH (Plan Section 6.6(h)) Distributions upon the death of a
Participant prior to receiving any benefits shall...

 

 

 

 

 

 

 

 

 

a.

x

be made pursuant to the election of the Participant or beneficiary.

 

 

 

 

 

 

 

 

 

b.

o

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
prior to December 31st of the year in which the Participant would have attained
age 70 1/2.

 

 

 

 

 

 

 

 

 

c.

o

be made within 5 (or if lesser____ ) years of death for all beneficiaries.

 

 

 

 

 

 

 

 

 

d.

o

be made within 5 (or if lesser____ ) years of death for all beneficiaries,
except that if the beneficiary is the Participant’s spouse, begin prior to
December 31st of the year in which the Participant would have attained age 70
1/2 and be payable over the life (or over a period not exceeding the life
expectancy) of such surviving spouse.

 

 

 

 

 

 

 

 

44.

HARDSHIP DISTRIBUTIONS (Plan Sections 6.11 and/or 12.9)

 

 

 

 

 

 

 

 

 

a.

o

No hardship distributions are permitted.

 

 

 

 

 

 

 

 

 

b.

x

Hardship distributions are permitted from the following accounts (select all
that apply):

 

 

 

 

 

 

 

 

 

 

 

1.

o

All accounts.

 

 

 

 

 

 

 

 

 

 

 

2.

x

Participant’s Elective Deferral Account.

 

 

 

 

 

 

 

 

 

 

 

3.

o

Participant’s Account attributable to Employer matching contributions.

 

 

 

 

 

 

 

 

 

 

 

4.

o

Participant’s Account attributable to Employer profit sharing contributions.

 

 

 

 

 

 

 

 

 

 

 

5.

x

Participant’s Rollover Account.

 

 

 

 

 

 

 

 

 

 

 

6.

o

Participant’s Transfer Account.

 

 

 

 

 

 

 

 

 

 

 

7.

o

Participant’s Voluntary Contribution Account.

 

 

 

 

 

 

 

 

 

NOTE:

Distributions from a Participant’s Elective Deferral Account are limited to the
portion of such account attributable to such Participant’s Elective Deferrals
(and earnings attributable thereto up to December 31, 1988). Hardship
distributions are not permitted from a Participant’s Qualified Non-Elective
Account (including any 401(k) Safe Harbor Contributions) or Qualified Matching
Contribution Account.

 

 

 

 

 

 

 

 

 

AND, shall the safe harbor hardship rules of Plan Section 12.9 apply to
distributions made from all accounts? (Note: The safe harbor hardship rules
automatically apply to hardship distributions of Elective Deferrals.)

 

 

 

 

 

 

 

 

 

c.

o

No or N/A. The provisions of Plan Section 6.11 apply to hardship distributions
from all accounts other than a Participant’s Elective Deferral Account.

 

 

 

 

 

 

 

 

 

d.

x

Yes. The provisions of Plan Section 12.9 apply to all hardship distributions.

(C) 2002 Markley Actuarial Services, Inc.

18

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NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

AND, are distributions restricted to those accounts in which a Participant is
fully Vested?

 

 

 

 

 

 

e.

x

Yes, distributions may only be made from accounts which are fully Vested.

 

 

 

 

 

 

f.

o

No. (If elected, the fraction at Plan Section 6.5(h) shall apply in determining
vesting of the portion of the account balance not withdrawn).

 

 

 

 

 

 

AND, the minimum hardship distribution shall be...

 

 

 

 

 

 

g.

o

N/A. There is no minimum.

 

 

 

 

 

 

h.

x

$500 (may not exceed $1,000).

 

 

 

 

 

45.

IN-SERVICE DISTRIBUTIONS (Plan Section 6.10)

 

 

 

 

 

 

a.

o

In-service distributions may not be made (except as otherwise elected for
Hardship Distributions).

 

 

 

 

 

 

b.

x

In-service distributions may be made to a Participant who has not separated from
service provided any of the following conditions have been satisfied (select all
that apply):

 

 

 

 

 

 

 

1.

o

the Participant has attained age_____.

 

 

 

 

 

 

 

2.

x

the Participant has reached Normal Retirement Age.

 

 

 

 

 

 

 

3.

o

the Participant has been a Participant in the Plan for at least ____ years (may
not be less than five (5)).

 

 

 

 

 

 

 

4.

o

the amounts being distributed have accumulated in the Plan for at least two (2)
years.

 

 

 

 

 

 

AND, in-service distributions are permitted from the following accounts (select
all that apply):

 

 

 

 

 

 

c.

x

All accounts.

 

 

 

 

 

 

d.

o

Participant’s Elective Deferral Account.

 

 

 

 

 

 

e.

o

Qualified Matching Contribution Account and portion of Participant’s Account
attributable to Employer matching contributions.

 

 

 

 

 

 

f.

o

Participant’s Account attributable to Employer profit sharing contributions.

 

 

 

 

 

 

g.

o

Qualified Non-Elective Contribution Account.

 

 

 

 

 

h.

o

Participant’s Rollover Account.

 

 

 

 

 

 

i.

o

Participant’s Transfer Account.

 

 

 

 

 

 

j.

o

Participant’s Voluntary Contribution Account.

 

 

 

 

 

 

NOTE:

Distributions from a Participant’s Elective Deferral Account, Qualified Matching
Contribution Account and Qualified Non-Elective Account (including 401(k) Safe
Harbor Contributions) are subject to restrictions and generally may not be
distributed prior to age 59 1/2.

 

 

 

 

 

 

AND, are distributions restricted to those accounts in which a Participant is
fully Vested?

 

 

 

 

 

 

k.

x

Yes, distributions may only be made from accounts which are fully Vested.

 

 

 

 

 

 

l.

o

No. (If elected, the fraction at Plan Section 6.5(h) will apply in determining
vesting of the portion of the account balance not withdrawn.)

 

 

 

 

 

 

AND, the minimum distribution shall be...

 

 

 

 

 

 

m.

o

N/A. There is no minimum.

 

 

 

 

 

 

n.

x

$1000 (may not exceed $1,000).

 

 

 

 

 

NONDISCRIMINATION TESTING

 

 

 

 

 

46.

HIGHLY COMPENSATED EMPLOYEE (Plan Section 1.31)

 

 

 

 

 

 

NOTE:

 

If this is a GUST restatement, complete the questions in this Section
retroactively to the first Plan Year beginning after 1996.

 

 

 

 

 

 

TOP-PAID GROUP ELECTION. Will the top ___ -paid group election be made? (The
election made below for the latest year will continue to apply to subsequent
Plan Years unless a different election is made.)

 

 

 

 

 

 

a.

o

Yes, for the Plan Year beginning in: ______.

 

 

 

 

 

 

b.

x

No, for the Plan Year beginning in: 1997.

 

 

 

 

 

 

CALENDAR YEAR DATA ELECTION. Will the calendar year data election be used? (The
election made below for the latest year will continue to apply to subsequent
Plan Years unless a different election is made.)

 

 

 

 

 

 

c.

o

Yes, for the Plan Year beginning in: ______.

 

 

 

 

 

 

d.

x

No, for the Plan Year beginning in: 1997.

(C) 2002 Markley Actuarial Services, Inc.

19

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NON-STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

47.

ADP AND ACP TESTS (Plan Sections 12.4 and 12.6). The ADP ratio and ACP ratio for
Non-Highly Compensated Employees will be based on the following. The election
made below for the latest year will continue to apply to subsequent Plan Years
unless the Plan is amended to a different election.

 

 

 

 

 

a.

o

N/A. This Plan satisfies the ADP Test Safe Harbor rules and there are no
contributions subject to an ACP test or for all Plan Years beginning in or after
the Effective Date of the Plan or, in the case of an amendment and restatement,
for all Plan Years to which the amendment and restatement relates.

 

 

 

 

 

b.

o

PRIOR YEAR TESTING: The prior year ratio will be used for the Plan Year
beginning in _____. (Note: If this election is made for the first year the Code
Section 401(k) or 401(m) feature is added to this Plan (unless this Plan is a
successor plan), the amount taken into account as the ADP and ACP of Non-Highly
Compensated Employees for the preceding Plan Year will be 3%.)

 

 

 

 

 

c.

x

CURRENT YEAR TESTING: The current year ratio will be used for the Plan Year
beginning in 1997.

 

 

 

 

 

NOTE:

 

In any Plan Year where the ADP Test Safe Harbor is being used but not the ACP
Test Safe Harbor, then c. above must be used if an ACP test applies for such
Plan Year.

 

 

 

 

TOP HEAVY REQUIREMENTS

 

 

 

 

48.

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: (If b., c., d. or e. is elected, f. must be completed.)

 

 

 

 

 

a.

x

N/A. The Employer does not maintain a Defined Benefit Plan. (Go to next
Question)

 

 

 

 

 

b.

o

The full top heavy minimum will be provided in each plan (if selected, Plan
Section 4.3(i) shall not apply).

 

 

 

 

 

c.

o

5% defined contribution minimum.

 

 

 

 

 

d.

o

2% defined benefit minimum.

 

 

 

 

 

e.

o

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:

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

NOTE:

 

If c., d., or e. is selected and the Defined Benefit Plan and this Plan do not
benefit the same Participants, the uniformity requirement of the Section
401(a)(4) Regulations may be violated.

 

 

 

 

 

AND,

 

the “Present Value of Accrued Benefit” (Plan Section 9.2) for Top Heavy purposes
shall be based on...

 

 

 

 

 

 

 

 

 

f.

o

Interest Rate:
_________________________________________________________________________

 

 

 

 

 

 

 

Mortality Table:
_______________________________________________________________________

 

 

 

 

 

 

 

 

49.

TOP HEAVY DUPLICATIONS (Plan Section 4.3(f)): When a Non-Key Employee is a
Participant in this Plan and another defined contribution plan maintained by the
Employer, indicate which method shall be utilized to avoid duplication of top
heavy minimum benefits:

 

 

 

 

 

a.

x

N/A. The Employer does not maintain another qualified defined contribution plan.

 

 

 

 

 

b.

o

The full top heavy minimum will be provided in each plan.

 

c.

o

A minimum, non-integrated contribution of 3% of each Non-Key Employee’s 415
Compensation shall be provided in the Money Purchase Plan (or other plan subject
to Code Section 412).

 

 

 

 

 

d.

o

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:

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

NOTE:

 

If c. or d. is selected and both plans do not benefit the same Participants, the
uniformity requirement of the Section 401(a)(4) Regulations may be violated.

 

 

 

 

 

 

 

 

 

 

 

 

MISCELLANEOUS

 

 

 

 

50.

LOANS TO PARTICIPANTS (Plan Section 7.6)

 

 

 

 

 

a.

o

Loans are not permitted.

 

 

 

 

 

b.

x

Loans are permitted.

(C) 2002 Markley Actuarial Services, Inc.

20

--------------------------------------------------------------------------------

NON–STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

 

 

IF loans are permitted (select all that apply)...

 

 

c.

x

loans will be treated as a Participant directed investment.

 

 

d.

o

loans will only be made for hardship or financial necessity.

 

 

e.

x

the minimum loan will be $500 (may not exceed $1,000).

 

 

f.

x

a Participant may only have 2 (e.g., one (1)) loan(s) outstanding at any time.

 

 

g.

o

all outstanding loan balances will become due and payable in their entirety upon
the occurrence of a distributable event (other than satisfaction of the
conditions for an in-service distribution).

 

 

h.

x

loans will only be permitted from the following accounts (select all that
apply):

 

 

 

 

1.

x

All accounts.

 

 

 

 

2.

o

Participant’s Elective Deferral Account.

 

 

 

 

3.

o

Qualified Matching Contribution Account and/or portion of Participant’s Account
attributable to Employer matching contributions.

 

 

 

 

4.

o

Participant’s Account attributable to Employer profit sharing contributions.

 

 

 

 

5.

o

Qualified Non-Elective Contribution Account.

 

 

 

 

6.

o

Participant’s Rollover Account.

 

 

 

 

7.

o

Participant’s Transfer Account.

 

 

 

 

8.

o

Participant’s Voluntary Contribution Account.

 

 

NOTE:

Department of Labor Regulations require the adoption of a separate written loan
program setting forth the requirements outlined in Plan Section 7.6.

 

 

 

 

 

 

51.

DIRECTED INVESTMENT ACCOUNTS (Plan Section 4.10)

 

 

a.

o

Participant directed investments are not permitted.

 

 

b.

x

Participant directed investments are permitted for the following accounts
(select all that apply):

 

 

 

 

1.

x

All accounts.

 

 

 

 

2.

o

Participant’s Elective Deferral Account.

 

 

 

 

3.

o

Qualified Matching Contribution Account and/or portion of Participant’s Account
attributable to Employer matching contributions.

 

 

 

 

4.

o

Participant’s Profit Sharing Account.

 

 

 

 

5.

o

Qualified Non-Elective Contribution Account.

 

 

 

 

6.

o

Participant’s Rollover Account.

 

 

 

 

7.

o

Participant’s Transfer Account.

 

 

 

 

8.

o

Participant’s Voluntary Contribution Account.

 

 

 

 

9.

o

Other:

 

 

 

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

 

 

 

AND, is it intended that the Plan comply with Act Section 404(c) with respect to
the accounts subject to Participant investment direction?

 

 

c.

o

No.

 

 

 

 

d.

x

Yes

 

 

 

 

 

 

 

 

 

AND, will voting rights on directed investments be passed through to
Participants?

 

 

e.

o

No. Employer stock is not an alternative OR Plan is not intended to comply with
Act Section 404(c).

 

 

f.

x

Yes, for Employer stock only.

 

 

g.

o

Yes, for all investments.

 

 

 

 

 

 

52.

ROLLOVERS (Plan Section 4.6)

 

 

a.

o

Rollovers will not be accepted by this Plan.

 

 

b.

x

Rollovers will be accepted by this Plan.

 

 

 

 

 

 

 

 

AND, if b. is elected, rollovers may be accepted...

 

 

c.

x

from any Eligible Employee, even if not a Participant.

 

 

d.

o

from Participants only.

 

 

 

 

 

 

 

AND, distributions from a Participant’s Rollover Account may be made...

 

 

e.

x

at any time.

 

 

f.

o

only when the Participant is otherwise entitled to a distribution under the
Plan.

 

 

 

 

 

 

53.

AFTER-TAX VOLUNTARY EMPLOYEE CONTRIBUTIONS (Plan Section 4.8)

 

 

a.

x

After-tax voluntary Employee contributions will not be allowed.

 

 

b.

o

After-tax voluntary Employee contributions will be allowed.

 

 

 

 

 

 

54.

LIFE INSURANCE (Plan Section 7.5)

 

 

a.

x

Life insurance may not be purchased.

 

 

b.

o

Life insurance may be purchased at the option of the Administrator.

 

 

c.

o

Life insurance may be purchased at the option of the Participant.

(C) 2002 Markley Actuarial Services, Inc.

21

--------------------------------------------------------------------------------

NON–STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

 

AND, if b. or c. is elected, the purchase of initial or additional life
insurance will be subject to the following limitations (select all that apply):

 

 

d.

o

N/A, no limitations.

 

 

e.

o

each initial Contract will have a minimum face amount of $_______.

 

 

f.

o

each additional Contract will have a minimum face amount of $_______.

 

 

g.

o

the Participant has completed _____ Years of Service (or Periods of Service).

 

 

h.

o

the Participant has completed _____ Years of Service (or Periods of Service)
while a Participant in the Plan.

 

 

i.

o

the Participant is under age _____ on the Contract issue date.

 

 

j.

o

the maximum amount of all Contracts on behalf of a Participant may not exceed
$_______.

 

 

k.

o

the maximum face amount of any life insurance Contract will be $_______.

 

 

 

 

GUST TRANSITION RULES

 

 

 

 

 

The following questions only apply if this is a GUST restatement (i.e., Question
6.c. is selected). If this is not a GUST restatement, then this Plan will not be
considered an individually designed plan merely because the following questions
are deleted from the Adoption Agreement.

 

 

 

 

 

 

55.

COMPENSATION

 

 

The family aggregation rules of Code Section 401(a)(17) as in effect under Code
Section 414(q)(6) prior to the enactment of SBJPA do not apply to this Plan
effective as of:

 

 

a.

x

The first day of the first Plan Year beginning after 1996.

 

 

b.

o

______ (may not be prior to the first day of the first Plan Year beginning in
1997 and may not be later than the first day of the Plan Year following the Plan
Year in which this GUST restatement is adopted).

 

 

NOTE:

If family aggregation continued to apply after 1996, the Plan is not a safe
harbor plan for Code Section 401(a)(4) purposes and the Employer may not rely on
the opinion letter issued by the Internal Revenue Service that this Plan is
qualified under Code Section 401.

 

 

 

 

56.

LIMITATION ON ALLOCATIONS AND TOP HEAVY RULES If any Participant is a
Participant in this Plan and a qualified defined benefit plan maintained by the
Employer, then the limitations of Code Section 415(e) as in effect under Code
Section 414(q)(6) prior to the enactment of SBJPA do not apply to this Plan
effective with respect to Limitation Years beginning on or after:

 

 

a.

x

N/A. The Employer does not maintain, and has never maintained, a qualified
defined benefit plan OR the provisions of Code Section 415(e) have already been
removed from this Plan.

 

 

b.

o

______ (may not be prior to the first Limitation Year beginning in 2000 and may
not be later than the first Limitation Year beginning after the Limitation Year
in which this GUST restatement is adopted).

 

 

NOTE:

If the Code Section 415(e) limits continued to apply to Limitation Years
beginning after 1999, the Plan is not a safe harbor plan for Code Section
401(a)(4) purposes and the Employer may not rely on the opinion letter issued by
the Internal Revenue Service that this Plan is qualified under Code Section 401.

 

 

 

 

 

AND, if b. is selected with a date that is later than the effective date of this
GUST restatement, then with respect to the Limitation Year in which this
restatement is adopted, if any Participant is a Participant in this Plan and a
qualified defined benefit plan maintained by the Employer, specify the method
under which the plans involved will provide top heavy minimum benefits for
Non-Key Employees and will satisfy the limitations of Code Section 415(e) in a
manner that precludes Employer discretion:

 

 

c.

o

N/A. The effective date of the GUST restatement is the date the provisions of
Code Section 415(e) no longer apply to this Plan.

 

 

d.

o

 

 

 

 

--------------------------------------------------------------------------------

 

 

NOTE:

If the top heavy minimum benefit is only provided in one plan and the Defined
Benefit Plan and this Plan do not benefit the same Participants, the uniformity
requirement of the Section 401(a)(4) Regulations may be violated.

 

 

 

 

57.

INVOLUNTARY DISTRIBUTIONS If the Plan provides for involuntary distributions
(i.e., 41.a. is elected) then the increase in the involuntary amount threshold
from $3,500 to $5,000 became effective with respect to distributions made on or
after:

 

 

a.

o

N/A. The plan doesn’t provide for involuntary distributions less than $5,000.

 

 

b.

x

August 6, 1997, or if later _____ (leave blank if not applicable).

(C) 2002 Markley Actuarial Services, Inc.

22

--------------------------------------------------------------------------------

NON–STANDARDIZED 401(k) PROFIT SHARING PLAN

 

 

 

 

 

 

58.

MINIMUM DISTRIBUTIONS

 

 

The proposed Code Section 401(a)(9) Regulations issued in January 2001 apply
with respect to distributions under the Plan made on or after January 1, 2001,
unless a later date is specified below:

 

 

a.

o

N/A.

 

 

 

b.

x

January 1, 2002 (may be any date in 2001 or the first day of any calendar year
after 2001).

 

 

AND, if b. is selected, for years prior to the date specified above, life
expectancies for minimum distributions required pursuant to Code Section
401(a)(9) shall...

 

 

c.

o

be recalculated at the Participant’s election.

 

 

d.

o

be recalculated.

 

 

e.

x

not be recalculated.

 

 

 

 

59.

ADP AND ACP TESTS. For Plan Years beginning in and prior to the Plan Year in
which the restatement is adopted, the following will apply:

 

 

 

 

 

ADP TEST:

 

 

a.

o

PRIOR YEAR TESTING: The prior year ratio will be used for the Plan Year
beginning in the year specified below. (If this election is made for the first
year the Code Section 401(k) feature is added to this Plan (unless this Plan is
a successor plan), the amount taken into account as the ADP of Non-Highly
Compensated Employees for the preceding Plan Year will be 3%.) 1. o 1997 2.o
1998 3. o 1999 4. o 2000 5. o __

 

 

b.

x

CURRENT YEAR TESTING: The current year ratio will be used for the Plan Year
beginning in: 1. x 1997 2. x 1998 3. x 1999 4. x 2000 5. o __

 

 

 

 

 

ACP TEST:

 

 

c.

o

N/A.

 

 

d.

o

PRIOR YEAR TESTING: The prior year ratio will be used for the Plan Year
beginning in the year specified below. (If this election is made for the first
year the Code Section 401(m) feature is added to this Plan (unless this Plan is
a successor plan), the amount taken into account as the ACP of Non-Highly
Compensated Employees for the preceding Plan Year will be 3%.) 1. o 1997 2. o
1998 3. o 1999 4. o 2000 5. o __

 

 

e.

x

CURRENT YEAR TESTING: The current year ratio will be used for the Plan Year
beginning in: 1. x 1997 2. x 1998 3. x 1999 4. x 2000 5. o __

(C) 2002 Markley Actuarial Services, Inc.

23

--------------------------------------------------------------------------------

NON–STANDARDIZED 401(k) PROFIT SHARING PLAN

The adopting Employer may rely on an opinion letter issued by the Internal
Revenue Service as evidence that the plan is qualified under Code Section 401
only to the extent provided in Announcement 2001-77, 2001-30 I.R.B.

The Employer may not rely on the opinion letter in certain other circumstances
or with respect to certain qualification requirements, which are specified in
the opinion letter issued with respect to the plan and in Announcement 2001-77.

In order to have reliance in such circumstances or with respect to such
qualification requirements, application for a determination letter must be made
to Employee Plans Determinations of the Internal Revenue Service.

This 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 Markley Actuarial Services, Inc. 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.

Markley Actuarial Services, Inc. will notify the Employer of any amendments made
to the Plan or of the discontinuance or abandonment of the Plan. Furthermore, in
order to be eligible to receive such notification, we agree to notify Markley
Actuarial Services, Inc. of any change in address.

This Plan may not be used, and shall not be deemed to be a Prototype Plan,
unless an authorized representative of Markley Actuarial Services, 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.

Markley Actuarial Services, Inc.

 

 

 

By:

/s/ JOHN R. MARKLEY

 

 

--------------------------------------------------------------------------------

 

 

John R. Markley

 

With regard to any questions regarding the provisions of the Plan, adoption of
the Plan, or the effect of an opinion letter from the IRS, call or write (this
information must be completed by the sponsor of this Plan or its designated
representative):

 

 

 

 

Name:

John R. Markley

 

 

 

--------------------------------------------------------------------------------

 

 

 

 

Address:

8 North Queen Street, Suite 900

 

--------------------------------------------------------------------------------

 

 

 

Lancaster

Pennsylvania

17603

 

--------------------------------------------------------------------------------

 

 

 

 

Telephone:

(800) 815-9654

 

 

 

--------------------------------------------------------------------------------

(C) 2002 Markley Actuarial Services, Inc.

24

--------------------------------------------------------------------------------

NON–STANDARDIZED 401(k) PROFIT SHARING PLAN

The Employer and Trustee hereby cause this Plan to be executed on September 3,
2002.

Furthermore, this Plan may not be used unless acknowledged by Markley Actuarial
Services, Inc. or its authorized representative.

EMPLOYER:

Getty Realty Corp.

 

 

 

 

By:

/s/ THOMAS STIRNWEIS

 

 

--------------------------------------------------------------------------------

 

 

Thomas Stirnweis
Corporate Controller and Treasurer

 

 

 

o

The signature of the Trustee appears on a separate trust agreement attached to
the Plan,

OR

 

 

/s/ LEO LIEBOWITZ

 

--------------------------------------------------------------------------------

 

Leo Liebowitz
TRUSTEE

 

 

 

/s/ RANDI YOUNG FILIP

 

--------------------------------------------------------------------------------

 

Randi Young Filip
TRUSTEE

 

 

 

/s/ THOMAS STIRNWEIS

 

--------------------------------------------------------------------------------

 

Thomas Stirnweis
TRUSTEE

 

(C) 2002 Markley Actuarial Services, Inc.

25

--------------------------------------------------------------------------------

EGTRRA

AMENDMENT TO THE

GETTY REALTY CORP. RETIREMENT AND PROFIT SHARING PLAN

--------------------------------------------------------------------------------

EGTRRA – Employer

ARTICLE I

PREAMBLE

 

 

 

1.1

Adoption and effective date of amendment. This amendment of the plan is adopted
to reflect certain provisions of the Economic Growth and Tax Relief
Reconciliation Act of 2001 (“EGTRRA”). This amendment is intended as good faith
compliance with the requirements of EGTRRA and is to be construed in accordance
with EGTRRA and guidance issued thereunder. Except as otherwise provided, this
amendment shall be effective as of the first day of the first plan year
beginning after December 31, 2001.

 

 

1.2

Supersession of inconsistent provisions. This amendment shall supersede the
provisions of the plan to the extent those provisions are inconsistent with the
provisions of this amendment.

 

 

ARTICLE II

 

 

 

ADOPTION AGREEMENT ELECTIONS

--------------------------------------------------------------------------------

THE QUESTIONS IN THIS ARTICLE II ONLY NEED TO BE COMPLETED IN ORDER TO OVERRIDE
THE DEFAULT PROVISIONS SET FORTH BELOW. IF ALL OF THE DEFAULT PROVISIONS WILL
APPLY, THEN THESE QUESTIONS SHOULD BE SKIPPED.

 

 

 

UNLESS THE EMPLOYER ELECTS OTHERWISE IN THIS ARTICLE II, THE FOLLOWING DEFAULTS
APPLY:

 

 

1)

THE VESTING SCHEDULE FOR MATCHING CONTRIBUTIONS WILL BE A 6 YEAR GRADED SCHEDULE
(IF THE PLAN CURRENTLY HAS A GRADED SCHEDULE THAT DOES NOT SATISFY EGTRRA) OR A
3 YEAR CLIFF SCHEDULE (IF THE PLAN CURRENTLY HAS A CLIFF SCHEDULE THAT DOES NOT
SATISFY EGTRRA), AND SUCH SCHEDULE WILL APPLY TO ALL MATCHING CONTRIBUTIONS
(EVEN THOSE MADE PRIOR TO 2002).

 

 

 

 

2)

ROLLOVERS ARE AUTOMATICALLY EXCLUDED IN DETERMINING WHETHER THE $5,000 THRESHOLD
HAS BEEN EXCEEDED FOR AUTOMATIC CASH-OUTS (IF THE PLAN IS NOT SUBJECT TO THE
QUALIFIED JOINT AND SURVIVOR ANNUITY RULES AND PROVIDES FOR AUTOMATIC
CASH-OUTS). THIS IS APPLIED TO ALL PARTICIPANTS REGARDLESS OF WHEN THE
DISTRIBUTABLE EVENT OCCURRED.

 

 

 

 

3)

THE SUSPENSION PERIOD AFTER A HARDSHIP DISTRIBUTION IS MADE WILL BE 6 MONTHS AND
THIS WILL ONLY APPLY TO HARDSHIP DISTRIBUTIONS MADE AFTER 2001.

 

 

 

 

4)

CATCH-UP CONTRIBUTIONS WILL BE ALLOWED.

 

 

 

 

5)

FOR TARGET BENEFIT PLANS, THE INCREASED COMPENSATION LIMIT OF $200,000 WILL BE
APPLIED RETROACTIVELY (I.E., TO YEARS PRIOR TO 2002).

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

 

 

 

2.1

VESTING SCHEDULE FOR MATCHING CONTRIBUTIONS

 

 

 

If there are matching contributions subject to a vesting schedule that does not
satisfy EGTRRA, then unless otherwise elected below, for participants who
complete an hour of service in a plan year beginning after December 31, 2001,
the following vesting schedule will apply to all matching contributions subject
to a vesting schedule:

 

 

 

 

If the plan has a graded vesting schedule (i.e., the vesting schedule includes a
vested percentage that is more than 0% and less than 100%) the following will
apply:

 

 

 

Years of vesting service

Nonforfeitable percentage

 

 

2

20

%

3

40

%

4

60

%

5

80

%

6

100

%

If the plan does not have a graded vesting schedule, then matching contributions
will be nonforfeitable upon the completion of 3 years of vesting service.

1

--------------------------------------------------------------------------------

EGTRRA – Employer

 

 

 

 

In lieu of the above vesting schedule, the employer elects the following
schedule:

 

 

a.

o

3 year cliff (a participant’s accrued benefit derived from employer matching
contributions shall be nonforfeitable upon the participant’s completion of three
years of vesting service).

 

 

b.

o

6 year graded schedule (20% after 2 years of vesting service and an additional
20% for each year thereafter).

 

 

c.

o

Other (must be at least as liberal as a. or the b. above):

 

 

 

Years of vesting service

 

Nonforfeitable percentage

 

 

 

_______

 

_______%

_______

 

_______%

_______

 

_______%

_______

 

_______%

_______

 

_______%

 

 

 

 

 

The vesting schedule set forth herein shall only apply to participants who
complete an hour of service in a plan year beginning after December 31, 2001,
and, unless the option below is elected, shall apply to all matching
contributions subject to a vesting schedule.

 

 

d.

o  

The vesting schedule will only apply to matching contributions made in plan
years beginning after December 31, 2001 (the prior schedule will apply to
matching contributions made in prior plan years).

 

 

 

 

2.2

EXCLUSION OF ROLLOVERS IN APPLICATION OF INVOLUNTARY CASH-OUT PROVISIONS (FOR
PROFIT SHARING AND 401(K) PLANS ONLY). If the plan is not subject to the
qualified joint and survivor annuity rules and includes involuntary cash-out
provisions, then unless one of the options below is elected, effective for
distributions made after December 31, 2001, rollover contributions will be
excluded in determining the value of the participant’s nonforfeitable account
balance for purposes of the plan’s involuntary cash-out rules.

 

 

a.

o

Rollover contributions will not be excluded.

 

 

b.

x

Rollover contributions will be excluded only with respect to distributions made
after January 1, 2002. (Enter a date no earlier than December 31, 2001.)

 

 

c.

o

Rollover contributions will only be excluded with respect to participants who
separated from service after ________. (Enter a date. The date may be earlier
than December 31, 2001.)

 

 

 

 

2.3

SUSPENSION PERIOD OF HARDSHIP DISTRIBUTIONS. If the plan provides for hardship
distributions upon satisfaction of the safe harbor (deemed) standards as set
forth in Treas. Reg. Section 1.401(k)-1(d)(2)(iv), then, unless the option below
is elected, the suspension period following a hardship distribution shall only
apply to hardship distributions made after December 31, 2001.

 

 

 

x

With regard to hardship distributions made during 2001, a participant shall be
prohibited from making elective deferrals and employee contributions under this
and all other plans until the later of January 1, 2002, or 6 months after
receipt of the distribution.

 

 

 

 

2.4

CATCH-UP CONTRIBUTIONS (FOR 401(k) PROFIT SHARING PLANS ONLY): The plan permits
catch-up contributions (Article VI) unless the option below is elected.

 

 

 

 

 

 

o

The plan does not permit catch-up contributions to be made.

 

 

 

 

ARTICLE III

 

VESTING OF MATCHING CONTRIBUTIONS

 

 

3.1

Applicability. This Article shall apply to participants who complete an Hour of
Service after December 31, 2001, with respect to accrued benefits derived from
employer matching contributions made in plan years beginning after December 31,
2001. Unless otherwise elected by the employer in Section 2.1 above, this
Article shall also apply to all such participants with respect to accrued
benefits derived from employer matching contributions made in plan years
beginning prior to January 1, 2002.

 

 

 

3.2

Vesting schedule. A participant’s accrued benefit derived from employer matching
contributions shall vest as provided in Section 2.1 of this amendment.

 

 

 

ARTICLE IV

 

 

 

INVOLUNTARY CASH-OUTS

 

 

 

4.1

Applicability and effective date. If the plan provides for involuntary cash-outs
of amounts less than $5,000, then unless otherwise elected in Section 2.2 of
this amendment, this Article shall apply for distributions made after December
31, 2001, and shall apply to all participants. However, regardless of the
preceding, this Article shall not apply if the plan is subject to the qualified
joint and survivor annuity requirements of Sections 401(a)(11) and 417 of the
Code.

 

 

 

4.2

Rollovers disregarded in determining value of account balance for involuntary
distributions. For purposes of the Sections of the plan that provide for the
involuntary distribution of vested accrued benefits of $5,000 or less, the value
of a participant’s nonforfeitable account balance shall be determined without
regard to that portion of the account

2

--------------------------------------------------------------------------------

EGTRRA - Employer

 

 

 

balance that is attributable to rollover contributions (and earnings allocable
thereto) within the meaning of Sections 402(c), 403(a)(4), 403(b)(8),
408(d)(3)(A)(ii), and 457(e)(16) of the Code. If the value of the participant’s
nonforfeitable account balance as so determined is $5,000 or less, then the plan
shall immediately distribute the participant’s entire nonforfeitable account
balance.

 

 

ARTICLE V

 

HARDSHIP DISTRIBUTIONS

 

5.1

Applicability and effective date. If the plan provides for hardship
distributions upon satisfaction of the safe harbor (deemed) standards as set
forth in Treas. Reg. Section 1.401(k)-1(d)(2)(iv), then this Article shall apply
for calendar years beginning after 2001.

 

 

5.2

Suspension period following hardship distribution. A participant who receives a
distribution of elective deferrals after December 31, 2001, on account of
hardship shall be prohibited from making elective deferrals and employee
contributions under this and all other plans of the employer for 6 months after
receipt of the distribution. Furthermore, if elected by the employer in Section
2.3 of this amendment, a participant who receives a distribution of elective
deferrals in calendar year 2001 on account of hardship shall be prohibited from
making elective deferrals and employee contributions under this and all other
plans until the later of January 1, 2002, or 6 months after receipt of the
distribution.

ARTICLE VI

CATCH-UP CONTRIBUTIONS

Catch-up Contributions. Unless otherwise elected in Section 2.4 of this
amendment, all employees who are eligible to make elective deferrals under this
plan and who have attained age 50 before the close of the plan year shall be
eligible to make catch-up contributions in accordance with, and subject to the
limitations of, Section 414(v) of the Code. Such catch-up contributions shall
not be taken into account for purposes of the provisions of the plan
implementing the required limitations of Sections 402(g) and 415 of the Code.
The plan shall not be treated as failing to satisfy the provisions of the plan
implementing the requirements of Section 401(k)(3), 401(k)(11), 401(k)(12),
410(b), or 416 of the Code, as applicable, by reason of the making of such
catch-up contributions.

ARTICLE VII

INCREASE IN COMPENSATION LIMIT

Increase in Compensation Limit. The annual compensation of each participant
taken into account in determining allocations for any plan year beginning after
December 31, 2001, shall not exceed $200,000, as adjusted for cost-of-living
increases in accordance with Section 401(a)(17)(B) of the Code. Annual
compensation means compensation during the plan year or such other consecutive
12-month period over which compensation is otherwise determined under the plan
(the determination period). If this is a target benefit plan, then except as
otherwise elected in Section 2.5 of this amendment, for purposes of determining
benefit accruals in a plan year beginning after December 31, 2001, compensation
for any prior determination period shall be limited to $200,000. The
cost-of-living adjustment in effect for a calendar year applies to annual
compensation for the determination period that begins with or within such
calendar year.

ARTICLE VIII

PLAN LOANS

Plan loans for owner-employees or shareholder-employees. If the plan permits
loans to be made to participants, then effective for plan loans made after
December 31, 2001, plan provisions prohibiting loans to any owner-employee or
shareholder-employee shall cease to apply.

ARTICLE IX

LIMITATIONS ON CONTRIBUTIONS (IRC SECTION 415 LIMITS)

 

 

 

9.1

Effective date. This Section shall be effective for limitation years beginning
after December 31, 2001.

 

 

9.2

Maximum annual addition. Except to the extent permitted under Article VI of this
amendment and Section 414(v) of the Code, if applicable, the annual addition
that may be contributed or allocated to a participant’s account under the plan
for any limitation year shall not exceed the lesser of:

 

 

 

a.

$40,000, as adjusted for increases in the cost-of-living under Section 415(d) of
the Code, or

 

 

 

 

b.

100 percent of the participant’s compensation, within the meaning of Section
415(c)(3) of the Code, for the limitation year.

The compensation limit referred to in b. shall not apply to any contribution for
medical benefits after separation from service (within the meaning of Section
401(h) or Section 419A(f)(2) of the Code) which is otherwise treated as an
annual addition.

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EGTRRA - Employer

ARTICLE X

MODIFICATION OF TOP-HEAVY RULES

 

 

 

10.1

Effective date. This Article shall apply for purposes of determining whether the
plan is a top -heavy plan under Section 416(g) of the Code for plan years
beginning after December 31, 2001, and whether the plan satisfies the minimum
benefits requirements of Section 416(c) of the Code for such years. This Article
amends the top-heavy provisions of the plan.

 

 

10.2

Determination of top-heavy status.

 

 

10.2.1

Key employee. Key employee means any employee or former employee (including any
deceased employee) who at any time during the plan year that includes the
determination date was an officer of the employer having annual compensation
greater than $130,000 (as adjusted under Section 416(i)(1) of the Code for plan
years beginning after December 31, 2002), a 5-percent owner of the employer, or
a 1-percent owner of the employer having annual compensation of more than
$150,000. For this purpose, annual compensation means compensation within the
meaning of Section 415(c)(3) of the Code. The determination of who is a key
employee will be made in accordance with Section 416(i)(1) of the Code and the
applicable regulations and other guidance of general applicability issued
thereunder.

 

 

10.2.2  

Determination of present values and amounts. This Section 10.2.2 shall apply for
purposes of determining the present values of accrued benefits and the amounts
of account balances of employees as of the determination date.

 

 

 

a.

Distributions during year ending on the determination date. The present values
of accrued benefits and the amounts of account balances of an employee as of the
determination date shall be increased by the distributions made with respect to
the employee under the plan and any plan aggregated with the plan under Section
416(g)(2) of the Code during the 1-year period ending on the determination date.
The preceding sentence shall also apply to distributions under a terminated plan
which, had it not been terminated, would have been aggregated with the plan
under Section 416(g)(2)(A)(i) of the Code. In the case of a distribution made
for a reason other than separation from service, death, or disability, this
provision shall be applied by substituting “5-year period” for “1-year period.”

 

 

 

 

b.

Employees not performing services during year ending on the determination date.
The accrued benefits and accounts of any individual who has not performed
services for the employer during the 1-year period ending on the determination
date shall not be taken into account.

 

 

 

10.3

Minimum benefits.

 

 

10.3.1

Matching contributions. Employer matching contributions shall be taken into
account for purposes of satisfying the minimum contribution requirements of
Section 416(c)(2) of the Code and the plan. The preceding sentence shall apply
with respect to matching contributions under the plan or, if the plan provides
that the minimum contribution requirement shall be met in another plan, such
other plan. Employer matching contributions that are used to satisfy the minimum
contribution requirements shall be treated as matching contributions for
purposes of the actual contribution percentage test and other requirements of
Section 401(m) of the Code.

 

 

10.3.2

Contributions under other plans. The employer may provide, in an addendum to
this amendment, that the minimum benefit requirement shall be met in another
plan (including another plan that consists solely of a cash or deferred
arrangement which meets the requirements of Section 401(k)(12) of the Code and
matching contributions with respect to which the requirements of Section
401(m)(11) of the Code are met). The addendum should include the name of the
other plan, the minimum benefit that will be provided under such other plan, and
the employees who will receive the minimum benefit under such other plan.

ARTICLE XI

DIRECT ROLLOVERS

 

 

11.1

Effective date. This Article shall apply to distributions made after December
31, 2001.

 

 

11.2

Modification of definition of eligible retirement plan. For purposes of the
direct rollover provisions of the plan, an eligible retirement plan shall also
mean an annuity contract described in Section 403(b) of the Code and an eligible
plan under Section 457(b) of the Code which is maintained by a state, political
subdivision of a state, or any agency or instrumentality of a state or political
subdivision of a state and which agrees to separately account for amounts
transferred into such plan from this plan. The definition of eligible retirement
plan shall also apply in the case of a distribution to a surviving spouse, or to
a spouse or former spouse who is the alternate payee under a qualified domestic
relation order, as defined in Section 414(p) of the Code.

 

 

11.3

Modification of definition of eligible rollover distribution to exclude hardship
distributions. For purposes of the direct rollover provisions of the plan, any
amount that is distributed on account of hardship shall not be an eligible
rollover

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EGTRRA - Employer

 

 

 

distribution and the distributee may not elect to have any portion of such a
distribution paid directly to an eligible retirement plan.

 

 

11.4

Modification of definition of eligible rollover distribution to include
after-tax employee contributions. For purposes of the direct rollover provisions
in the plan, a portion of a distribution shall not fail to be an eligible
rollover distribution merely because the portion consists of after-tax employee
contributions which are not includible in gross income. However, such portion
may be transferred only to an individual retirement account or annuity described
in Section 408(a) or (b) of the Code, or to a qualified defined contribution
plan described in Section 401(a) or 403(a) of the Code that agrees to separately
account for amounts so transferred, including separately accounting for the
portion of such distribution which is includible in gross income and the portion
of such distribution which is not so includible.

ARTICLE XII

ROLLOVERS FROM OTHER PLANS

Rollovers from other plans. The employer, operationally and on a
nondiscriminatory basis, may limit the source of rollover contributions that may
be accepted by this plan.

ARTICLE XIII

REPEAL OF MULTIPLE USE TEST

Repeal of Multiple Use Test. The multiple use test described in Treasury
Regulation Section 1.401(m)-2 and the plan shall not apply for plan years
beginning after December 31, 2001.

ARTICLE XIV

ELECTIVE DEFERRALS

 

 

14.1

Elective Deferrals - Contribution Limitation. No participant shall be permitted
to have elective deferrals made under this plan, or any other qualified plan
maintained by the employer during any taxable year, in excess of the dollar
limitation contained in Section 402(g) of the Code in effect for such taxable
year, except to the extent permitted under Article VI of this amendment and
Section 414(v) of the Code, if applicable.

 

 

14.2

Maximum Salary Reduction Contributions for SIMPLE plans. If this is a SIMPLE
401(k) plan, then except to the extent permitted under Article VI of this
amendment and Section 414(v) of the Code, if applicable, the maximum salary
reduction contribution that can be made to this plan is the amount determined
under Section 408(p)(2)(A)(ii) of the Code for the calendar year.

ARTICLE XV

SAFE HARBOR PLAN PROVISIONS

Modification of Top-Heavy Rules. The top-heavy requirements of Section 416 of
the Code and the plan shall not apply in any year beginning after December 31,
2001, in which the plan consists solely of a cash or deferred arrangement which
meets the requirements of Section 401(k)(12) of the Code and matching
contributions with respect to which the requirements of Section 401(m)(11) of
the Code are met.

ARTICLE XVI

DISTRIBUTION UPON SEVERANCE OF EMPLOYMENT

 

 

16.1

Effective date. This Article shall apply for distributions and transactions made
after December 31, 2001, regardless of when the severance of employment
occurred.

 

 

16.2

New distributable event. A participant’s elective deferrals, qualified
nonelective contributions, qualified matching contributions, and earnings
attributable to these contributions shall be distributed on account of the
participant’s severance from employment. However, such a distribution shall be
subject to the other provisions of the plan regarding distributions, other than
provisions that require a separation from service before such amounts may be
distributed.

This amendment has been executed this third day of September, 2003.

Name of Employer: Getty Realty Corp.

 

 

By:

/s/ THOMAS STIRNWEIS

 

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Thomas Stirnweis
Corporate Controller and Treasurer
EMPLOYER

Name of Plan: Getty Realty Corp. Retirement and Profit Sharing Plan

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