PROTOTYPE DEFINED
CONTRIBUTION PLAN Sponsored By PNC Bank, National
Association
The Sponsor
hereby establishes this Plan for use by its clients who wish to
adopt a qualified retirement plan. This Plan shall be interpreted
in a manner consistent with the intention of the adopting Employer
that this Plan satisfy Internal Revenue Code Sections 401 and 501.
Any Plan and Trust established hereunder shall be so established
for the exclusive benefit of Plan Participants and their
Beneficiaries and shall be administered under the following terms
and conditions:
ARTICLE I
DEFINITIONS
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1.1
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Actual
Contribution Percentage (ACP) The ratio (expressed as a percentage and
calculated separately for each Participant) of:
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(a)
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the
Participant’s Contribution Percentage Amounts [as defined at
(c)-(f)] for a Plan Year, to
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(b)
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the
Participant’s Compensation for such Plan Year. [Unless
otherwise specified in the Adoption Agreement, Compensation will
only include amounts for the period during which the Employee was
eligible to participate.]
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Contribution
Percentage Amounts on behalf of any Participant shall
include:
(c)
the amount of Voluntary After-tax
Contributions, Required After-tax Contributions, Matching
Contributions (except to the extent such Matching Contributions may
be disregarded in accordance with IRS Notice 98-1), and Qualified
Matching Contributions (to the extent not taken into account for
purposes of the ADP test) made under the Plan on behalf of the
Participant,
(d)
forfeitures of Excess Aggregate
Contributions or Matching Contributions allocated to the
Participant’s account which shall be taken into account in
the year in which such forfeiture is allocated,
(e)
at the election of the Employer,
Qualified Non-Elective Contributions, and
(f)
the Employer may elect to use
Elective Deferrals in the Contribution Percentage Amounts as long
as the ADP test 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.
Contribution
amounts shall not include Matching Contributions, whether or not
Qualified, that are forfeited either to correct Excess Aggregate
Contributions, or because the contributions to which they relate
are Excess Deferrals, Excess Contributions, or Excess Aggregate
Contributions.
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1.2
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Actual
Deferral Percentage (ADP) The ratio (expressed as a percentage and
calculated separately for each Participant) of:
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(a)
the amount of Employer
contributions [as defined at (c) - (d)] actually contributed to the
Trust on behalf of such Participant for a Plan Year, to
(b)
the Participant’s
Compensation for such Plan Year. [Unless otherwise specified in the
Adoption Agreement, Compensation will only include amounts received
for the period during which the Employee was eligible to
participate.]
Employer
contributions on behalf of any Participant shall
include:
(c)
any Elective Deferrals made
pursuant to the Participant’s Salary Deferral Agreement,
including Excess Elective Deferrals of Highly Compensated
Employees, but excluding Excess Elective Deferrals distributed to
Non-Highly Compensated Employees and Elective Deferrals that are
either taken into account in the Contribution Percentage test
(provided the ADP test is satisfied both with and without exclusion
of these Elective Deferrals) or are returned as excess Annual
Additions,
(d)
at the election of the Employer,
Qualified Non-Elective Contributions and Qualified Matching
Contributions.
For purposes of
computing Actual Deferral Percentages, an eligible Employee who
fails to make Elective Deferrals shall be treated as a Participant
on whose behalf no Elective Deferrals are made.
The document
attached to this Plan by which an Employer who adopts a Plan elects
the terms and conditions of a Qualified Plan established under this
Basic Plan Document #01.
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(a)
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125% of the
greater of the Average Deferral Percentage of the Non-Highly
Compensated Employees for the Prior Plan Year or the Average
Contribution Percentage of Non-Highly Compensated Employees under
the 401(k) Plan subject to Code Section 401(m) for the Plan Year
beginning with or within the Prior Plan Year, and
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(b)
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the lesser of
200% or two percent plus the lesser of such ADP or ACP.
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Alternatively,
the Aggregate Limit can be determined by substituting “the
lesser of 200% or two percent plus” for “125% of”
in (a) above, and substituting “125% of” for “the
lesser of 200% or two percent plus” in (b) 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 Non-Highly Compensated Employees’
ADP and ACP for that Plan Year, instead of the prior Plan Year, is
used.
The date or
dates on which Participant recordkeeping accounts are adjusted to
reflect account activity including but not limited to
contributions, loans distributions, Hardship withdrawals, as well
as earnings activity including but not limited to income, capital
gains or market fluctuations in accordance with Article V hereof.
Unless the Plan Administrator in a uniform and nondiscriminatory
manner designates otherwise, all allocations for a particular Plan
Year will be made as of the Valuation Date of that Plan
Year.
The sum of the
following amounts credited to a Participant’s account for the
Limitation Year:
(a)
Employer contributions (under
Article III),
(b)
Employee contributions (under
Article IV),
(c)
forfeitures,
(d)
Employer allocations under a
Simplified Employee Pension Plan,
(e)
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 (these amounts are treated as Annual Additions to a
Defined Contribution Plan though they arise under a Defined Benefit
Plan), and
(f)
amounts derived from contributions
paid or accrued after 1985, in taxable years ending after 1985,
which are either attributable to post-retirement medical benefits
allocated to the account of a Key Employee or to a Welfare Benefit
Fund maintained by the Employer. For purposes of this paragraph, an
Employee is a Key Employee if he or she meets the requirements of
paragraph 1.55 at any time during the Plan Year or any preceding
Plan Year.
For purposes of
applying the limitations of Code Section 415, the transfer of funds
from one Qualified Plan to another is not considered an Annual
Addition. The following are not Employee contributions for the
purposes of Annual Additions:
(g)
Rollover Contributions [as defined
in Code Sections 402(e)(6), 403(a)(4), 403(b)(8) and
408(d)(3)];
(h)
repayments of loans made to a
Participant from the Plan;
(i)
repayments of distributions
received by an Employee pursuant to Code Section 411(a)(7)(B)
(cash-outs);
(j)
repayments of distributions
received by an Employee pursuant to Code Section 411(a)(3)(D)
(mandatory contributions); and
(k) Employee
contributions to a Simplified Employee Pension Plan excludible from
gross income under Code Section 408(k)(6).
Employee and
Employer make-up contributions under USERRA received during the
current Limitation Year shall be treated as Annual Additions with
respect to the Limitation Year to which the make-up contributions
are attributable. Excess Amounts applied in a Limitation Year to
reduce Employer contributions will be considered Annual Additions
for such Limitation Year, pursuant to the provisions of Article
X.
The first day
of the first period for which an amount is paid as an annuity or in
any other form.
The First
Distribution Calendar Year, and in the event of the recalculation
of life expectancy, such succeeding calendar year. If payments
commence in accordance with paragraph 7.4(d) before the Required
Beginning Date, the Applicable Calendar Year is the year such
payments commence. If distribution is in the form of an immediate
annuity purchased after the Participant’s death with the
Participant’s remaining interest, the Applicable Calendar
Year is the year of purchase.
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Applicable Life Expectancy
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The life
expectancy or joint and last survivor expectancy calculated using
the attained age of the Participant or Beneficiary as of the
Participant’s or Beneficiary’s birthday in the
Applicable Calendar Year, reduced by one for each calendar year
which has elapsed since the date life expectancy was first
calculated. If life expectancy is being recalculated, the
Applicable Life Expectancy shall be the life expectancy as so
recalculated. The life expectancy of a non-Spouse Beneficiary may
not be recalculated.
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Average
Annual Compensation
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The average of
a Participant’s annual Compensation as defined in paragraph
1.16 of this Basic Plan Document #01, over the three (3)
consecutive Plan Year period ending in either the current year or
any prior year that produces the highest average. If the
Participant has fewer than three (3) years of participation in this
Plan, Compensation is averaged over the Participant’s total
period of participation.
1.
1.11 Average
Contribution Percentage (ACP)
2.
1.12 Average
Deferral Percentage (ADP)
The average of
the Actual Contribution Percentages for the eligible Participants
in a specified group of Participants for a Plan Year.
The average of
the Actual Deferral Percentages for Participants in a specified
group of Participants for a Plan Year.
A
“Beneficiary” is any person other than the Participant
and an estate or trust who by operation of law, or under the terms
of the Plan is entitled to receive any Vested Account Balance of a
Participant under the Plan. A “Designated Beneficiary”
is any individual designated or determined in accordance with Code
Section 401(a)(9) and the Regulations issued thereunder, except
that it shall not include any person who becomes a beneficiary by
virtue of the laws of inheritance or intestate
succession.
.(a) If
the Hours of Service method is used in determining either an
Employee’s initial or continuing eligibility to participate
in the Plan, or the nonforfeitable interest in the Employee’s
account balance derived from Employer contributions, a Break in
Service is a twelve (12) consecutive month period during which the
Employee has not completed more than five hundred (500) Hours of
Service.
.(b) For
purposes of determining whether a Break in Service has occurred in
a particular computation period, an Employee who is absent from
work for maternity or paternity reasons shall receive credit for
Hours of Service which would otherwise have been credited to such
Employee but for such absence, or in any case in which such hours
cannot be determined, with eight (8) Hours of Service per day of
such absence. The Hours of Service to be so credited shall be
credited in the computation period in which the absence begins if
the crediting is necessary to prevent a Break in Service in that
period or, in all other cases, in the following computation
periods.
.(c)
With respect to determinations based on the Elapsed Time method, a
severance period of not less than twelve (12) consecutive months.
In the case of an Employee 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 Break in Service.
.(d)
Notwithstanding the foregoing, in the case of an Employee who is
absent from work beyond the first anniversary of the first day of
absence from work for maternity or paternity reasons, such period
begins on the second anniversary of the first day of such absence.
The period between the first and second anniversaries of said first
day of absence from work is neither a Period of Service for which
the Employee will receive credit nor is such period a Break in
Service. For purposes of this paragraph, an absence from work for
maternity or paternity reasons means an absence (1) by reason of
the pregnancy of the Employee,
.(2) by
reason of the birth of a child of the Employee, (3) by reason of
the placement of a child with the Employee in connection with the
adoption of such child by such Employee, or (4) for purposes of
caring for such child for a period beginning immediately following
such birth or placement.
.(e) An
Employer adopting the Elapsed Time method is required to credit
periods of Service and, under the Service spanning rules, certain
periods of severance of twelve (12) months or less. Under the first
Service spanning rule, if an Employee severs from Service as a
result of resignation, discharge or retirement and then returns to
Service within twelve (12) months, the Period of Severance is
required to be taken into account. A situation may arise in which
an Employee is absent from Service for any reason other than
resignation, discharge, retirement and during the absence a
resignation, discharge or retirement occurs. The second Service
spanning rule provides that, under such circumstances, the Plan is
required to take into account the period of time between the
severance from Service date (i.e., the date of resignation,
discharge or retirement) and the first anniversary of the date on
which the Employee was first absent, if the Employee returns to
Service on or before such first anniversary date.
The Internal
Revenue Code of 1986, including any amendments thereto. Reference
to any section or subsection of the Code, includes reference to any
comparable or succeeding provisions of any legislation which
amends, supplements or replaces such section or subsection, and
also includes reference to any Regulation issued pursuant to or
with respect to such section or subsection.
The Employer
may select one of the following three safe harbor definitions of
Compensation in the Adoption Agreement. The definition of
Compensation (for Employers who adopt) under standardized plans,
plans that provide permitted disparity (other than the CODA portion
of these plans), Target Benefit Plans and for Employers determining
top-heavy minimum contributions must be one of the three safe
harbor definitions of Compensation. In a Nonstandardized Adoption
Agreement, the Employer may modify the definition of Compensation
provided that such definition, as modified, satisfies the
provisions of Code Sections 414(s) and 401(a)(4). Compensation will
also include Compensation by the Employer through another employer
or entity under the provisions of Code Sections 3121 and
3306.
.(a)
Code Section 3401(a) Wages - All
remuneration received by an Employee for services performed for the
Employer which are subject to Federal income tax withholding at the
source. Unless elected otherwise in the Adoption Agreement,
Compensation shall include any amount deferred under a Salary
Deferral Agreement which is not includible in the gross income of a
Participant under Code Section 125 in connection with a cafeteria
plan, Code Section 402(e)(3) in connection with a cash or deferred
plan, Code Section 402(h)(1)(B) in connection with a Simplified
Employee Pension Plan, Code Section 401(k) in connection with a
SIMPLE Retirement Account, Code Section 457 in connection with a
Plan maintained under said Section, and Code Section 403(b) in
connection with a tax-sheltered annuity plan. Wages are 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)]. For Limitation Years beginning after
December 31, 1997, for purposes of applying the limitations of this
paragraph, Compensation paid or made available during such
Limitation Year 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 Employee and which
is not includible in the gross income of the Employee by reason of
Code Sections 125, 132(f)(4), 402(e)(3), 402(h)(1), or
403(b).
.(b)
Code Sections 6041, 6051 And 6052 Reportable Wages
- All remuneration received by an Employee for
services performed for the Employer which are required to be
reported on Form W-2. Unless otherwise elected in the Adoption
Agreement, Compensation shall include any amount deferred under a
Salary Deferral Agreement which is not includible in the gross
income of a Participant under Code Section 125 in connection with a
cafeteria plan, Code Section 402(e)(3) in connection with a cash or
deferred plan, Code Section 402(h)(1)(B) in connection with a
Simplified Employee Pension Plan, and Code Section 403(b) in
connection with a tax-sheltered annuity plan. A Participant’s
wages includes remuneration defined at subparagraph (a) above and
all other remuneration paid 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. Such amount must
be 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)]. For Limitation
Years beginning after December 31, 1997, for purposes of applying
the limitations of this paragraph, Compensation paid or made
available during such Limitation Year 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 Employee and which is not includible in the gross income of the
Employee by reason of Code Sections 125, 132(f)(4), 402(e)(3),
402(h)(1) or 403(b).
.(c)
Code Section 415 Compensation - A
Participant’s Earned Income, 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. Compensation includes, but is not limited to,
commissions paid salesmen, Compensation for services on the basis
of a percentage of profits, commissions on insurance premiums,
tips, bonuses, fringe benefits and reimbursements or other expense
allowances under a nonaccountable plan [as described in Regulation
Section 1.62-2(c)]. For Limitation Years beginning after December
31, 1997, for purposes of applying the limitations of this
paragraph, Compensation paid or made available during such
Limitation Year 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 Employee and which
is not includible in the gross income of the Employee by reason of
Code Sections 125, 132(f)(4), 402(e)(3), 402(h)(1) or 403(b).
Compensation excludes the following:
(1) for Plan Years beginning before January 1,
1998, Employer contributions made under the terms of a Salary
Deferral Agreement between an Employee and the Employer to a plan
of deferred compensation which are not includible in the
Employee’s gross income for the taxable year in which
contributed. Such contributions shall include any amount deferred
under Code Section 125 in connection with a cafeteria plan, Code
Section 402(e)(3) in connection with a cash or deferred plan, Code
Section 402(h)(1)(B) in connection with a Simplified Employee
Pension Plan, Code Section 402(k) in connection with a SIMPLE
Retirement Account, Code Section 457 in connection with a Plan
maintained under said Section, and Code Section 403(b) in
connection with a tax-sheltered annuity plan,
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(2)
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distributions
received from a plan of deferred compensation,
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(3)
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amounts
realized from the exercise of a non-qualified stock option, or when
restricted stock (or
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property) held
by the Employee either becomes freely transferable or is no longer
subject to a
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substantial
risk of forfeiture,
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(4)
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amounts
realized from the sale, exchange or other disposition of stock
acquired under a qualified
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stock option,
and
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(5)
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amounts
deferred by an Employee under the terms of a non-qualified deferred
compensation plan.
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Unless
otherwise specified by the Employer in the Adoption Agreement,
Compensation shall be determined as provided in Code Section
3401(a) [paragraph (a) above]. Notwithstanding the foregoing, the
Compensation of a Participant who is a sole proprietor, partner or
a member of a limited liability corporation (LLC) shall be
determined under Code Section 415. Unless indicated otherwise in
the Adoption Agreement, the definition of Compensation used in
nondiscrimination testing (ADP/ACP Testing) will be determined by
the Employer. Notwithstanding any other provision to the contrary,
if the Plan is an amendment and restatement of a Qualified Plan,
for Plan Years ending prior to the Plan Year in which the amendment
or restatement is adopted, Compensation shall have the meaning set
forth in the Qualified Plan prior to its amendment.
Exclusions From Compensation
A Participant’s Compensation
shall be determined in accordance with paragraph (a), (b) or (c)
above and shall not exclude any item of income unless provided in
the basic definition or elected by the Employer in the Adoption
Agreement.
Annual
Additions And Top-Heavy Rules Except as elected on the Adoption Agreement, for
purposes of Article X and XIV, Compensation shall be Code Section
415 Compensation as described in paragraph 1.16(c). For Plan Years
beginning before January 1, 1998, Compensation excludes amounts
deferred under a plan of deferred Compensation as described at
paragraph 1.16(c)(1). For Plan Years beginning after December 31,
1997, Compensation includes amounts deferred under a plan of
deferred compensation as described at paragraph 1.16(c)(1). For
purposes of applying the limitations of Article X, Compensation for
a Limitation Year is the Compensation actually paid or made
available during such Limitation Year. For Limitation Years
beginning after December 31, 1997, for purposes of applying the
limitations of this paragraph, Compensation paid or made available
during such Limitation Year 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
Employee and which is not includible in the gross income of the
Employee by reason of Code Sections 125, 132(f)(4), 402(e)(3),
402(h)(1)(B) or 403(b).
If the Plan is
or becomes Top-Heavy in any Plan Year beginning after December 31,
1983, the provisions of Article XIV will supersede any conflicting
provisions in the Basic Plan Document #01 or Adoption
Agreement.
Contributions Made On Behalf Of Disabled
Participants Compensation with respect to a Participant in a
Defined Contribution Plan who is permanently and totally disabled
[as defined in Code Section 22(e)(3)] is the Compensation such
Participant would have received for the Limitation Year if the
Participant had been paid at the rate of Compensation paid
immediately before becoming permanently and totally disabled; for
Limitation Years beginning before January 1, 1997, but not for
Limitation Years beginning after December 31, 1996, such imputed
Compensation for the disabled Participant may be taken into account
only if the Participant is not a Highly Compensated Employee
(defined at paragraph 1.52) and contributions made on behalf of
such Participant are nonforfeitable when made. Compensation will
mean Compensation as that term is defined in this
paragraph.
Highly
Compensated And Key Employees For purposes of paragraphs 1.52 and 1.55,
Compensation shall be Code Section 415 Compensation as described in
paragraph 1.16(c). Such definition shall include any amount
deferred under Code Section 125 in connection with a cafeteria
plan, Code Section 402(e)(3) in connection with a cash or deferred
plan, Code Section 402(h)(1)(B) in connection with a Simplified
Employee Pension Plan, Code Section 402(k) in connection with a
SIMPLE Retirement Account (SIMPLE), Code Section 457 in connection
with a Plan maintained under said Section, and Code Section 403(b)
in connection with a tax-sheltered annuity plan. The Employer, if
elected in the Adoption Agreement, may limit Compensation
considered for purposes of the Plan for these
Participants.
Computation Period The Plan Year, while eligible to participate,
shall be the computation period for purposes of determining a
Participant’s Compensation, unless the Employer selects a
different computation period in the Adoption Agreement.
Limitation On Compensation
The annual Compensation of each
Participant which may be taken into account for determining all
benefits provided under the Plan for any year, shall not exceed the
limitation as imposed by Code Section 401(a)(17), as adjusted under
Code Section 401(a)(17)(B). If a Plan has a Plan Year that contains
fewer than twelve (12) calendar months, the annual Compensation
limit for that period is an amount equal to the limitation as
imposed by Code Section 401(a)(17) as adjusted for the calendar
year in which the Compensation period begins, multiplied by a
fraction, the numerator of which is the number of full months in
the short Plan Year and the denominator of which is twelve
(12).
USERRA For purposes of Employee and Employer make-up
contributions, Compensation during the period of military service
shall be deemed to be the Compensation the Employee would have
received during such period if the Employee were not in qualified
military service, based on the rate of pay the Employee would have
received from the Employer but for the absence due to military
leave. If the Compensation the Employee would have received during
the leave is not reasonably certain, Compensation will be equal to
the Employee’s average Compensation from the Employer during
the twelve (12) month period immediately preceding the military
leave or, if shorter, the Employee’s actual period of
employment with the Employer.
Definition of Compensation for Purposes of Safe
Harbor CODA Provisions Compensation for the purposes of a Safe Harbor
CODA is defined in this paragraph 1.16 of this Basic Plan Document
#01. No dollar limit other than the limit imposed by Code Section
401(a)(17) applies to the Compensation of a Non-Highly Compensated
Employee. For purposes of determining the Compensation subject to a
Participant’s salary deferral election, the Employer may use
an alternative definition to the one described above provided such
alternative definition is a reasonable definition within the
meaning of Section 1.414(s)-1(d)(2) of the Regulations and permits
each Participant to contribute sufficient Elective Deferrals to
receive the maximum amount of Matching Contributions (determined
using the definition of Compensation described above) available to
the Participant under the Plan.
Definition Of Compensation For Purposes Of
401(k) SIMPLE Provisions For purposes of paragraphs 1.36 and 3.2, of this
Basic Plan Document #01, Compensation is 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 Code
Section 125 in connection with a cafeteria plan, Code Section
402(e)(3) in connection with a cash or deferred plan, Code Section
402(h)(1)(B) in connection with a Simplified Employee Pension Plan,
Code Section 402(k) in connection with a SIMPLE Retirement Account,
Code Section 457 in connection with a plan maintained under said
Section and Code Section 403(b) in connection with a tax-sheltered
annuity 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 to this Plan on behalf of any Employee. The
provisions of the Plan implementing the limit on Compensation under
Code Section 401(a)(17) apply to the Compensation under paragraph
4.8 of Article IV.
A
Participant’s Covered Compensation for a Plan Year is the
average (without indexing) of the Taxable Wage Bases in effect for
each calendar year in the thirty-five (35) year period ending with
the calendar year in which the Participant attains (or will attain)
social security retirement age. In determining a
Participant’s Covered Compensation for a Plan Year, the
Taxable Wage Base in effect for the current Plan Year and any
subsequent Plan Year will be assumed to be the same as the taxable
wage base in effect as of the beginning of the Plan Year for which
the determination is being made. Covered Compensation will be
determined for the year designated by the Employer in Section
III(C) of the Target Benefit Plan Adoption Agreement.
A
Participant’s Covered Compensation for a Plan Year before the
end of the thirty-five (35) year period ending with the last day of
the calendar year in which the Participant attains social security
retirement age is the Taxable Wage Base in effect as of the
beginning of the Plan Year. A Participant’s Covered
Compensation for a Plan Year after such thirty-five (35) year
period is the Participant’s Covered Compensation for the Plan
Year during which the thirty-five (35) year period ends.
The institution
or institutions (who may be the Sponsor or an affiliate) and any
successors or assigns thereto, appointed by the Employer to hold
the assets of the Trust as provided at paragraph 13.2
herein.
40 U.S.C.
Section 276a et seq. as may be amended from time to
time.
A plan under
which a Participant's benefit is determined by a formula contained
in the plan and no Employee accounts are maintained for
Participants.
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1.21
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Defined
Benefit (Plan) Fraction
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For Limitation
Years beginning before January 1, 2000, a fraction, the numerator
of which is the sum of the Participant's Projected Annual Benefits
under all the Defined Benefit Plans (whether or not terminated)
maintained by the Employer, and the denominator of which is the
lesser of 125% of the dollar limitation determined for the
Limitation Year under Code Sections 415(b) and (d) or 140% of the
Highest Average Compensation, including any adjustments under Code
Section 415(b).
Transitional Rule If an Employee was a Participant as of the first
day of the first Limitation Year beginning after 1986, in one or
more Defined Benefit Plans maintained by the Employer which were in
existence on May 6, 1986, the denominator of this fraction will not
be less than 125% of the sum of the annual benefits under such
Plans which the Participant had accrued as of the close of the last
Limitation Year beginning before 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
1987.
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1.22
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Defined
Contribution Dollar Limitation
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Thirty thousand
dollars ($30,000) as adjusted by the Secretary of the Treasury for
increases in the cost-of-living. This limitation shall be adjusted
by the Secretary at the same time and in the same manner as under
Code Section 415(d). Such increases will be in multiples of five
thousand dollars ($5,000).
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1.23
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Defined
Contribution Plan
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A plan under
which Employee accounts are maintained for each Participant to
which all contributions, forfeitures, investment income and gains
or losses, and expenses are credited or deducted. A Participant's
benefit under such plan is based solely on the fair market value of
his or her account balance.
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1.24
|
Defined
Contribution (Plan) Fraction
|
For Limitation
Years beginning before January 1, 2000, a fraction, the numerator
of which is the sum of the Annual Additions to the Participant's
account under all the Defined Contribution Plans (whether or not
terminated) maintained by the Employer for the current and all
prior Limitation Years (including the Annual Additions attributable
to the Participant's nondeductible Employee contributions to all
Defined Benefit Plans, whether or not terminated, maintained by the
Employer, and the Annual Additions attributable to all Welfare
Benefit Funds as defined in paragraph 1.116, individual medical
accounts as defined in Code Section 415(l)(2) and Simplified
Employee Pension Plans as defined in paragraph 1.99, maintained by
the Employer), and the denominator of which is the sum of the
maximum aggregate amounts for the current and all prior Limitation
Years of Service with the Employer (regardless of whether a Defined
Contribution Plan was maintained by the Employer). The maximum
aggregate amount in the Limitation Year is the lesser of 125% of
the dollar limitation determined under Code Sections 415(b) and (d)
in effect under Code Section 415(c)(1)(A) or 35% of the
Participant's Compensation for such year.
Transitional Rule If an Employee was a Participant as of the end
of the first day of the first Limitation Year beginning after 1986,
in one or more Defined Contribution Plans maintained by the
Employer which were in existence on May 6, 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 the excess of the sum of the fractions over 1.0 multiplied by
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 1987, and disregarding any
changes in the terms and conditions of the Plan made after May 6,
1986, but using the Code Section 415 limitation applicable to the
first Limitation Year beginning on or after January 1, 1987. The
Annual Addition for any Limitation Year beginning before 1987,
shall not be re-computed to treat all Employee contributions as
Annual Additions.
A payment made
by the Plan to an Eligible Retirement Plan that is specified by the
Participant or a payment received by the Plan from an Eligible
Retirement Plan on behalf of a Participant or an Employee, if
selected in the Adoption Agreement by the Employer.
Unless the
Employer has elected a different definition in the Adoption
Agreement, Disability is defined as an illness or injury of a
potentially permanent nature, expected to last for a continuous
period of not less than 12 months or can be expected to result in
death, certified by a physician selected by or satisfactory to the
Employer, which prevents the Participant from engaging in any
occupation for wage or profit for which the Employee is reasonably
fitted by training, education or experience. If elected by the
Employer in the Adoption Agreement, nonforfeitable contributions
will be made to the Plan on behalf of each disabled Participant who
is not a Highly Compensated Employee (as defined at paragraph
1.52). Compensation for purposes of calculating the contribution
will mean Compensation as defined at paragraph 1.16
herein.
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1.27
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Distribution Calendar Year
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A calendar year
for which a minimum distribution is required.
The age set by
the Employer in the Adoption Agreement, not less than age fifty
five (55), at which a Participant becomes fully vested and is
eligible to retire and receive his or her benefits under the
Plan.
The date
elected by the Employer in the Adoption Agreement on which a
Participant or former Participant has satisfied the Early
Retirement Age requirements. If no election is made on the Adoption
Agreement, it shall mean the date on which a Participant attains
his or her Early Retirement Age.
A former
Participant who has separated from Service after satisfying any
service requirement but before satisfying the Early Retirement Age
and who thereafter reaches the age requirement elected on the
Adoption Agreement shall be entitled to receive benefits under the
Plan (other than full vesting and any allocation of Employer
contributions) as though the requirements for Early Retirement Age
had been satisfied.
Net earnings
from self-employment in the trade or business with respect to which
the Plan is established, determined without regard to items not
included in gross income and the deductions allocable to such
items, provided that personal services of the individual are a
material income-producing factor. Earned Income shall be reduced by
contributions made by an Employer to a Qualified Plan to the extent
deductible under Code Section 404. Net earnings shall be determined
taking into account the deduction for one-half of self-employment
taxes allowed to the taxpayer under Code Section 164(f), to the
extent deductible for taxable years beginning after December 31,
1989.
The date on
which the Employer's Plan or amendment to such Plan becomes
effective. For amendments reflecting statutory and regulatory
changes contained in The Uruguay Round Agreements Act of the
General Agreement on Tariffs and Trade (GATT), The Uniformed
Services Employment and Reemployment Rights Act of 1994 (USERRA),
The Small Business Job Protection Act of 1996 (SBJPA), The Taxpayer
Relief Act of 1997 (TRA’97), The Internal Revenue Service
Restructuring and Reform Act of 1998 (IRSRRA), and the Community
Renewal Tax Relief Act of 2000 (CRA), the Effective Date(s) of the
applicable provisions of this legislation will be the earlier of
the date upon which such amendment is first administratively
applied or the first day of the Plan Year following the date of
adoption of such amendment or adoption of the Basic Plan Document
#01 and accompanying Adoption Agreement.
The period
which begins on the first day of the Plan Year in which the
Participant attains age thirty-five (35) and ends on the date of
the Participant's death. If a Participant separates from Service
prior to the first day of the Plan Year in which age thirty-five
(35) is attained, the Election Period shall begin on the date of
separation, with respect to the account balance as of the date of
separation.
A method of
determining an Employee’s entitlement under the Plan with
respect to eligibility to participate, and/or vesting, which is not
based on the Employee’s completion of a specified number of
Hours of Service during a consecutive twelve (12) month period, but
rather with reference to the total period of time which elapses
during which the Employee is employed by the Employer maintaining
the Plan.
If the Employer
is a member of an affiliated service group [under Code Section
414(m)], a controlled group of corporations [under Code Section
414(b)], a group of trades or businesses under common control
[under Code Section 414(c)] or any other entity required to be
aggregated with the Employer pursuant to Code Section 414(o),
Service will be credited for any employment for any period of time
for any other member of such group. Service will also be credited
for any individual required under Code Section 414(n) or Code
Section 414(o) to be considered an Employee of any Employer
aggregated under Code Section 414(b), (c) or (m).
Employer
contributions in lieu of cash Compensation made to the Plan on
behalf of the Participant pursuant to a Salary Deferral Agreement
or other deferral mechanism. With respect to any taxable year, a
Participant's Elective Deferral is 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 Simplified Employee
Pension Plan with a cash or deferred arrangement as described 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 plan as described under Code Section 501(c)(18),
and any Employer contributions made on behalf of a Participant for
the purchase of an annuity contract under Code Section 403(b)
pursuant to a Salary Deferral Agreement. Elective Deferrals shall
not include any deferrals properly distributed as excess Annual
Additions.
For purposes of
the SIMPLE 401(k) Plan provisions, any Employee who is entitled to
make Elective Deferrals under the terms of the SIMPLE 401(k)
Plan.
An Eligible
Employer means with respect to any Plan Year, an Employer who had
no more than one hundred (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 controlled groups
of corporations under Code Section 414(b), all Employees of trades
or businesses (whether incorporated or not) under common control
under Code Section 414(c), all Employees of affiliated service
groups under Code Section 414(m), and Leased Employees required to
be treated as the Employer’s Employees under Code Section
414(n), are taken into account.
An Eligible
Employer that elects to have the SIMPLE 401(k) Plan provisions
apply to the Plan that 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.
Any Employee
who is eligible to make a Voluntary or Required After-tax
Contribution or an Elective Deferral (if the Employer takes such
contributions into account in the calculation of the Actual
Contribution Percentage), or to receive a Matching Contribution
(including forfeitures) or a Qualified Matching Contribution. If a
Required After-tax Contribution is required as a condition of
participation in the Plan, any Employee who would be a Participant
in the Plan if such Employee made such a contribution shall be
treated as an Eligible Participant even though no Employee
contributions are made.
An individual
retirement account (IRA) as described in Code Section 408(a), an
individual retirement annuity (IRA) as described in Code Section
408(b), an annuity plan as described in Code Section 403(a), or a
qualified trust as described in Code Section 401(a), which accepts
Eligible Rollover Distributions. However, in the case of an
Eligible Rollover Distribution paid to a surviving Spouse, an
Eligible Retirement Plan is an individual retirement account or
individual retirement annuity.
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Eligible
Rollover Distribution
|
An Eligible
Rollover Distribution is any distribution of all or any portion of
the balance to the credit of the Participant except that an
Eligible Rollover Distribution does not include:
.(a) any
distribution that is one of a series of substantially equal
periodic payments made not less frequently than annually for the
life (or life expectancy) of the Participant or the joint lives (or
joint life expectancies) of the Participant and the Participant's
Beneficiary, or for a specified period of ten (10) years or
more,
.(b) any
distribution to the extent such distribution is required under Code
Section 401(a)(9),
.(c) any
Hardship withdrawals under Code Section 401(k)(2)(B)(i)(IV)
received after December 31, 1998, (or if elected by the Employer in
accordance with IRS Notice 99-5, received after December 31,
1999).
.(d) the
portion of any distribution that would not be includible in gross
income if paid to the Participant (determined without regard to the
exclusion for net unrealized appreciation with respect to Employer
securities),
.(e)
excess amounts which are returned to a Participant in accordance
with paragraphs 7.11, 7.12, 7.13, and 10.2,
.(f) any
other distribution(s) that is reasonably expected to total less
than $200 during a year,
.(g)
corrective distributions of Excess Elective Deferrals under Code
Section 402(g), and the income allocable thereto,
.(h)
Excess Contributions and Excess Aggregate Contributions under Code
Section 401(k) and Code Section 401(m), and the income allocable
thereto,
.(i) PS
58 costs, and
.(j)
dividends paid on securities under Code Section 404(k).
A person
employed by an Employer maintaining the Plan (including
Self-Employed Individuals and partners). The term Employee shall
include Employees of a member of an affiliated service group [as
defined in Code Section 414(m)], all Employees of a controlled
group of corporations [as defined in Code Section 414(b)], all
Employees of any incorporated or unincorporated trade or business
which is under common control [as defined in Code Section 414(c)],
Leased Employees [as defined in Code Section 414(n)], and any
Employee required to be aggregated by Code Section 414(o). All such
Employees shall be treated as employed by a single
Employer.
Leased
Employees shall not be Employees for purposes of participation in
any Plan established under a Nonstandardized Adoption Agreement,
unless otherwise elected by the Employer in the Adoption Agreement.
Leased Employees [as defined in Code Sections 414(n) or 414(o)]
shall be considered Employees in a Plan established under a
standardized Adoption Agreement except as otherwise provided in
this paragraph. Exclusion under a standardized Adoption Agreement
is available only if Leased Employees do not constitute more than
20% of the recipient Employer’s non-highly compensated work
force, and the Employer complies with the requirements as outlined
in paragraph 2.7, and so elects in the Adoption
Agreement.
An individual
shall only be treated as an Employee if he or she is reported on
the payroll records of the Employer or an employer who is a member
of the same controlled group or affiliated service group as a
common law employee. The term does not include any other common law
employee or any Leased Employee. It is expressly intended that
individuals not treated as common law employees by the Employer or
a member of the same controlled group or affiliated service group
on their payroll records, as identified by a specific job code or
work status code, are to be excluded from plan participation even
if a court or administrative agency subsequently determines that
such individuals are common law employees and not independent
contractors.
The
Self-Employed Individual, partnership, corporation or other
organization which adopts this Plan including any entity that
succeeds the Employer and adopts this Plan. For purposes of Article
X, Limitations on Allocations, Employer shall mean the Employer
that adopts this Plan, and all members of a controlled group of
corporations [as defined in Code Section 414(b) as modified by Code
Section 415(h)], all commonly controlled trades or businesses [as
defined in Code Section 414(c) as modified by Code Section 415(h)]
or affiliated service groups [as defined in Code Section 414(m)] of
which the adopting Employer is a part, and any other entity
required to be aggregated with the Employer pursuant to Regulations
under Code Section 414(o).
In addition to
such required treatment, the Plan Sponsor may, in its discretion,
designate as an Employer any business entity which is not such a
“common control,”“affiliated service group”
or “predecessor” business entity which is otherwise
affiliated with the Employer, subject to such nondiscriminatory
limitations as the Employer may impose.
The date as of
which an Employee who has satisfied the Plan’s eligibility
requirements enters or reenters the Plan, as defined in the
Adoption Agreement.
The Employee
Retirement Income Security Act of 1974, as amended and any
successor statute.
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Excess
Aggregate Contributions
|
The excess,
with respect to any Plan Year, of:
.(a) the
aggregate Contribution Percentage Amounts taken into account in
computing the numerator of the Contribution Percentage actually
made on behalf of Highly Compensated Employees for such Plan Year,
over
.(b) the
maximum Contribution Percentage Amounts permitted by the ACP test
(determined hypothetically by reducing contributions made on behalf
of Highly Compensated Employees in order of their Contribution
Percentages beginning with the highest of such
percentages).
.(c)
Such determination shall be made after first determining Excess
Elective Deferrals pursuant to paragraph
1.47 and then
determining Excess Contributions pursuant to paragraph
1.46.
The excess of
the Participant's Annual Additions for the Limitation Year over the
Maximum Permissible Amount.
With respect to
any Plan Year, the excess of:
.(a) the
aggregate amount of Employer contributions actually taken into
account in computing the ADP of Highly Compensated Employees for
such Plan Year, over
.(b) the
maximum amount of such contributions permitted by the ADP Test
(determined by hypothetically reducing contributions made on behalf
of Highly Compensated Employees in order of the ADPs, beginning
with the highest of such percentages).
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Excess
Elective Deferrals
|
Those Elective
Deferrals that are includible in a Participant's gross income under
Code Section 402(g) to the extent such Participant's Elective
Deferrals for a taxable year exceed the dollar limitation under
Code Section 402(g). Excess Elective Deferrals shall be treated as
Annual Additions under the Plan, unless such amounts are
distributed no later than the first April 15 following the close of
the Participant's taxable year.
An eligibility
computation period during which an Employee in an eligible class is
expected to complete a Year of Service. If an Employee who is not
expected to complete a Year of Service actually completes a Year of
Service during an applicable computation period, he shall be deemed
to have become an Employee in the eligible class as of the first
day of the eligibility computation period in which he first
completes a Year of Service.
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First
Distribution Calendar Year
|
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 pursuant
to paragraph 7.10.
An immediate
and heavy financial need of the Employee where such Employee lacks
other available financial resources to satisfy such financial
need.
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Highest
Average Compensation
|
For Limitation
Years beginning before January 1, 2000, the average Compensation
for the three (3) consecutive Years of Service with the Employer
that produces the highest average. A Year of Service with the
Employer is the twelve (12) consecutive month period defined in the
Adoption Agreement, or, if not indicated in the Adoption Agreement,
as defined in paragraph 1.117.
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Highly
Compensated Employee
|
Effective for
years after December 31, 1996, the term Highly Compensated Employee
means any Employee who: (1) is a 5% owner at any time during the
year or preceding year, or (2) for the preceding year had
Compensation from the Employer in excess of $80,000 and if the
Employer so elects in the Adoption Agreement, is in the Top-Paid
Group for the preceding 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.
For the
determination of who is a Highly Compensated Employee, the
applicable year of the Plan for which a determination is being made
is called a determination year and the preceding twelve (12) month
period is called a look-back year. Employees who do not meet the
Highly Compensated Employee definition are considered Non-Highly
Compensated Employees.
A Highly
Compensated former Employee is based on the rules applicable to
determining Highly Compensated Employee status in effect for that
determination year, in accordance with Section 1.414(q)-1T, A-4 of
the temporary Income Tax Regulations and IRS Notice
97-45.
In determining
whether an Employee is a Highly Compensated Employee for years
beginning in 1997, the amendments to Code Section 414(q) stated
above are treated as having been in effect for years beginning in
1996. In order to be effective, a Top-Paid Group election or
calendar year data election must apply consistently to all plans of
the Employer that begin with or within the same calendar
year.
.(a)
Unless otherwise specified in the Adoption Agreement, each hour for
which an Employee is paid, or entitled to payment, for the
performance of duties for the Employer. These hours shall be
credited to the Employee for the computation period in which the
duties are performed, and
.(b)
each hour for which an Employee is paid, or entitled to payment, by
the Employer on account of a period of time during which no duties
are performed (irrespective of whether the employment relationship
has terminated) due to vacation, holiday, illness, incapacity
(including Disability), layoff, jury duty, military duty or leave
of absence. No more than five hundred and one (501) Hours of
Service shall be credited under this paragraph for any single
continuous period (whether or not such period need occur in a
single computation period). Hours under this paragraph shall be
calculated and credited pursuant to Section 2530.200b-2 of the
Department of Labor Regulations which are incorporated herein by
this reference, and
.(c)
each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer. The same
Hours of Service shall not be credited both under paragraph (a) or
paragraph (b), as the case may be, and under this paragraph (c).
These hours shall be credited to the Employee for the com-putation
period or periods to which the award or agreement pertains rather
than the computation period in which the award, agreement or
payment is made.
.(e)
Hours of Service shall be credited for employment with the Employer
and with other members of an affiliated service group [as defined
in Code Section 414(m)], a controlled group of corporations [as
defined in Code Section 414(b)], or a group of trades or businesses
under common control [as defined in Code Section 414(c)] of which
the adopting Employer is a member, and any other entity required to
be aggregated with the Employer pursuant to Code Section 414(o) and
the Regulations thereunder. Hours of Service shall also be credited
for any individual considered an Employee for purposes of this Plan
under Code Section 414(n) or Code Section 414(o) and the
Regulations thereunder.
.(f)
Solely for purposes of determining whether a Break in Service, as
defined in paragraph 1.14, for participation and vesting purposes
has occurred in a computation period, an individual who is absent
from work for maternity or paternity reasons shall receive credit
for the Hours of Service which would otherwise have been credited
to such individual but for such absence, or in any case in which
such hours cannot be determined, eight (8) Hours of Service per day
of such absence. For purposes of this paragraph, an absence from
work for maternity or paternity reasons means an absence by reason
of the pregnancy of the individual, by reason of a birth of a child
of the individual, by reason of the placement of a child with the
individual in connection with the adoption of such child by such
individual, or for purposes of caring for such child for a period
beginning immediately following such birth or placement. The Hours
of Service credited under this paragraph shall be credited in the
computation period in which the absence begins if the crediting is
necessary to prevent a Break in Service in that period, or in all
other cases, in the following computation period. No more than five
hundred and one (501) hours will be credited under this
paragraph.
.(g)
Hours of Service shall be determined under the hours counting
method as elected by the Employer in the Adoption Agreement. If no
election is made, actual hours under the hours counting method will
be used.
The amount of
Compensation specified in the Adoption Agreement at or below which
the rate of contributions or benefits (expressed in each case as a
percentage of such Compensation) provided under the Plan is less
than the rate of contributions or benefits (expressed in each case
as a percentage of such Compensation) provided under the Plan with
respect to Compensation above such level. The Adoption Agreement
must specify an Integration Level in effect for the Plan Year for
each Participant. No Integration Level in effect for a particular
year may exceed the contribution and benefit base (“Taxable
Wage Base”) under Section 230 [Code Section 3121(a)(1)] of
the Social Security Act in effect on the first day of the Plan
Year.
Any Employee or
former Employee (and the Beneficiaries of such Employee) who at any
time during the determination period was:
.(a) an
officer of the Employer if such individual's annual Compensation
exceeds 50% of the dollar limitation under Code Section
415(b)(1)(A) (the defined benefit maximum annual
benefit),
.(b) an
owner or an individual considered an owner under Code Section 318
of one of the ten (10) largest interests in the Employer if such
individual's Compensation exceeds 100% of the dollar limitation
under Code Section 415(c)(1)(A) and such ownership exceeds
½%,
.(c) a
more than 5% owner of the Employer, or
.(d) a
1% owner of the Employer who has an annual Compensation of more
than $150,000.
The
determination period is the Plan Year containing the Top-Heavy
Determination Date and the four (4) preceding Plan Years. The
determination of Key Employee status will be made in accordance
with Code Section 416(i)(1) and the Regulations
thereunder.
Effective for
Plan Years beginning after December 31, 1996, any person (other
than an Employee of the recipient) who, pursuant to an agreement
between the recipient and any other person ("leasing
organization"), has performed services for the recipient [or for
the recipient and related persons determined in accordance with
Code Section 414(n)(6)] on a substantially full-time basis for a
period of at least one year and such services are performed under
the primary direction or control of the recipient Employer. If a
Leased Employee is treated as an Employee by reason of this
paragraph 1.56, “Compensation” includes Compensation
from the leasing organization which is attributable to services
performed for the Employer.
The calendar
year or such other twelve (12) consecutive month period designated
by the Employer in the Adoption Agreement for purposes of
determining the maximum Annual Additions to a Participant's
account. All Qualified Plans maintained by the Employer must use
the same Limitation Year. 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. If no designation is made on the Adoption
Agreement, the Limitation Year will automatically default to the
Plan Year.
A plan, the
form of which is the subject of a favorable opinion letter from the
Internal Revenue Service.
An Employer
contribution made to this or any other Defined Contribution Plan on
behalf of a Participant on account of a Voluntary or Required
After-tax Contribution made by such Participant, or on account of a
Participant's Elective Deferral made by such Participant under a
Plan maintained by the Employer.
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1.60
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Maximum
Permissible Amount
|
The maximum
Annual Additions 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) the
Defined Contribution Dollar Limitation, or
.(b) 25%
of the Participant's Compensation for the Limitation
Year.
The
Compensation limitation referred to in (b) shall not apply to any
contribution for medical benefits [within the meaning of Code
Section 401(h) or Code Section 419A(f)(2)] which is otherwise
treated as an Annual Addition under Code Sections 415(l)(1) or
419(d)(2). 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).
The current and
accumulated operating earnings of the Employer after Federal and
state income taxes, excluding nonrecurring or unusual items of
income, and before contributions to this and any other Qualified
Plan of the Employer, unless the Employer has elected a different
definition in the Adoption Agreement.
The age set by
the Employer in the Adoption Agreement, not to exceed age
sixty-five (65), at which a Participant becomes fully vested and is
eligible to retire and receive his or her benefits under the
Plan.
The date on
which the Participant attains the Normal Retirement Age as elected
in the Adoption Agreement. If no election is made on the Adoption
Agreement, it shall mean the date on which a Participant attains
his or her Normal Retirement Age.
A sole
proprietor or a partner owning more than 10% of either the capital
or profits interest of the partnership.
Two (2) or more
plans which are either a combination of two (2) or more
standardized Defined Contribution Plans or a combination of one (1)
or more standardized Defined Contribution Plan(s) and one (1)
Defined Benefit Plan offered by the same sponsor, which have been
designed so that any single Plan, or combination of Plans adopted
by an Employer, where each Plan by itself or the Plans together
will meet the requirements of the antidiscrimination rules, the
contribution and benefit limitations, and the Top-Heavy provisions
of Code Sections 401(a)(4), 415 and 416.
Any current
Employee who met the applicable eligibility requirements and
reached his or her Entry Date and, where the context so requires,
pursuant to the terms of the Plan, any living former Employee on
whose behalf an Account is maintained or former Employee who has
met the eligibility requirements.
With respect to
required distributions pursuant to paragraph 7.4, the account
balance as of the last Valuation Date in the calendar year
immediately preceding the Distribution Calendar Year increased by
the amount of any contributions or forfeitures allocated to the
account balance as of the dates in the calendar year after the
Valuation Date and decreased by distributions made in the calendar
year after the Valuation Date. A special exception exists for the
second Distribution Calendar Year. For purposes of this paragraph,
if any portion of the minimum distribution for the First
Distribution Calendar Year is made in the second Distribution
Calendar Year on or before the Required Beginning Date, the amount
of the minimum distribution made in the second Distribution
Calendar Year shall be treated as if it had been made in the
immediately preceding Distribution Calendar Year.
For Plans using
Elapsed Time for purposes of crediting Service:
.(a) a
Break in Service shall mean a Period of Severance of at least
twelve (12) months;
.(b) a
Period of Severance is a continuous period of time during which the
Employee is not employed by the Employer;
.(c) a
Period of Severance 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.
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Permissive Aggregation Group
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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.
The Defined
Contribution Plan of the Employer in the form of this Prototype
Defined Contribution Plan and the applicable Adoption Agreement
executed by the Employer as may be amended from time to time (which
includes any addendum thereto). The Plan shall have the name
specified in the Adoption Agreement.
The Employer or
individual(s) or entity(ies) appointed by the Employer to
administer the Plan as provided at paragraph 12.1
herein.
The Employer
who adopts this Prototype Defined Contribution Plan and
accompanying Adoption Agreement.
The twelve (12)
consecutive month period designated by the Employer in the Adoption
Agreement. If the Employer maintains Paired Plans under Basic Plan
Document #01, each Plan established thereunder must have the same
Plan Year.
The actuarial
equivalent of a Participant's accrued benefit under a Defined
Benefit Plan maintained by the Employer expressed in the form of a
lump sum. Actuarial equivalence shall be based on reasonable
interest and mortality assumptions determined in accordance with
the Top-Heavy provisions of the respective plan. Present Value is
used for the purposes of the Top-Heavy test and the determination
with respect thereto.
The Plan Year
immediately preceding the current Plan Year.
A Target
Benefit Plan that:
.(a) was
adopted and in effect on September 19, 1991,
.(b)
which on that date contained a Stated Benefit Formula applicable to
Target Benefit Plans that took into account Service prior to that
date, and
.(c)
satisfied the applicable nondiscrimination requirements for Target
Benefit Plans for those prior years. For
purposes of
determining whether a plan satisfies the applicable
nondiscrimination requirements for Target Benefit Plans for Plan
Years beginning before January 1, 1994, no amendments after
September 19, 1991, other than amendments necessary to satisfy Code
Section 401(l), will be taken into account.
For Limitation
Years beginning before January 1, 2000, the annual retirement
benefit (adjusted to an actuarial 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 a Defined Benefit
Plan or Plans, assuming:
.(a) the
Participant will continue employment until Normal Retirement Age
under the Plan (or current age, if later), and
.(b) the
Participant's Compensation for the current Limitation Year and all
other relevant factors used to determine benefits under the Plan
will remain constant for all future Limitation Years.
For purposes of
determining a Participant’s stated benefit, a
Participant’s years of Projected Participation under the Plan
is the sum of (a) and (b), where
.(a) is
the number of years during which the Participant benefited under
this Plan beginning with the latest of:
.(1) the
first Plan Year in which the Participant benefited under the
Plan,
.(2) the
first Plan Year taken into account in the Stated Benefit Formula,
and
.(3) any
Plan Year immediately following a Plan Year in which the Plan did
not satisfy the safe harbor for Target Benefit Plans in Regulations
Section 1.401(a)(4)-8(b)(3), and ending with the last day of the
current Plan Year, and
.(b) is
the number of years if any, subsequent to the current Plan Year
through the end of the Plan Year in which the Participant attains
Normal Retirement Age.
For purposes of
this definition of years of Projected Participation, if this Plan
is a Prior Safe Harbor Plan, the Plan is deemed to satisfy the safe
harbor for Target Benefit Plans in Regulations Section
1.401(a)(4)-8(b)(3) and a Participant is treated as benefiting
under the Plan in any Plan Year beginning prior to January 1,
1994.
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Qualified Domestic Relations Order (QDRO
Order)
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A Qualified
Domestic Relations Order (QDRO) is a signed domestic relations
order issued by a state court or agency which creates, recognizes
or assigns to an alternate payee(s) the right to receive all or
part of a Participant's Plan benefit and which meets the
requirements of Code Section 414(p). An alternate payee is a
Spouse, former Spouse, child, or other dependent who is treated as
a Beneficiary under the Plan as a result of the QDRO. Unless
elected otherwise by the Employer in the Adoption Agreement, the
earliest date for payment of a QDRO to an alternate payee, is the
date upon which the order is deemed qualified.
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Qualified Early Retirement
Age
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For purposes of
paragraph 8.9, Qualified Early Retirement Age is the latest
of:
.(a) the
earliest date under the Plan on which the Participant may elect to
receive retirement benefits, or
.(b) the
first day of the 120th month beginning before the Participant
reaches Normal Retirement Age, or
.(c) the
date the Participant begins participation.
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Qualified Joint And Survivor Annuity
(QJSA)
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An immediate
annuity for the life of the Participant with a survivor annuity for
the life of the Participant's Spouse which is at least 50% of but
not more than 100% of the annuity payable during the joint lives of
the Participant and the Participant's Spouse. The exact amount of
the survivor annuity is to be specified by the Employer in the
Adoption Agreement. If not designated by the Employer, the survivor
annuity will be 50% of the amount paid to the Participant during
his or her lifetime. The Qualified Joint and Survivor Annuity will
be the amount of benefit which can be provided by the Participant's
Vested Account Balance.
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Qualified Matching Contributions
(QMACs)
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Matching
contributions which when made are subject to the distribution and
nonforfeitability requirements under Code Section
401(k).
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Qualified Non-Elective Contributions
(QNECs)
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Contributions
(other than Matching Contributions or Qualified Matching
Contributions) made by the Employer and allocated to Participants'
accounts that the Participants may not elect to receive in cash
until distributed from the Plan, that are nonforfeitable when made,
and that are distributable only in accordance with the distribution
provisions that are applicable to Elective Deferrals and Qualified
Matching Contributions.
