HomeMy WebLinkAbout47-80 RESOLUTION1„
RESOLUTION NO. 1.7-eio
A RESOLUTION APPROVING AND ADOPTING A DEFINED CONTRIBUTION
MONEY PURCHASE PENSION PLAN FOR CITY EMPLOYEES, DESIGNATING
A PLAN ADMINISTRATOR AND TRUSTEE, AND AUTHORIZING
EXECUTION OF A TRUST INDENTURE.
BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE CITY OF
FAYETTEVILLE, ARKANSAS:
Section 1. That the Board of Directors hereby approves
the Defined Contribution Money Purchase Pension Plan for
City employees attached hereto, marked Exhibit "A" and made
a part hereof.
Section 2. The Board of Directors hereby designates
King Hall and Associates, Inc. as plan administrator for
said pension plan and hereby designates McIlroy Bank & Trust
as trustee for said pension plan.
Section 3. That the Mayor and City Clerk are hereby
authorized and directed to execute a trust agreement with
McIlroy Bank & Trust for the City of Fayetteville Money
Purchase Pension Plan. A copy of the trust agreement authorized
for execution hereby is attached hereto, marked Exhibit "B"
and made a part hereof.
(0141 -
PASSED AND APPROVED this oar day of h
1980.
APPROVED:
MICROFILMED,
CERTIFICATE OF RECORD
State a Arkansas
City of Fayetteville (( ss
lr, Bonnie Goering, City Clerk and Er -Officio
recorder for the
City of Fayetteville, do here-
by certify that the annexed or foregoing is
of record in my office and the sarne am
nears in Ordirzance es,
t pag Reso/ution book
Witness tnY
hand and s thi e------------ ay of
City Clerk and Et- fficio
CONTRACT
PE?
Mi CROF ILMED,
THIS CONTRACT, executed this 2 day of
1980, by and between the City of Fayetteville, Arkansas, a
municipal corporation, hereinafter called the "City" and
King, Hall & Associates, Inc., hereinafter called "Consultant."
IN CONSIDERATION OF THE MUTAL COVENANTS CONTAINED
HEREIN, IT IS HEREBY AGREED BY THE PARTIES AS FOLLOWS:
1. Consultant agrees to serve as Plan Administrator of
the City of Fayetteville Money Purchase Pension Plan (the
Plan) dated June 1, 1980, which plan is incorporated herein
by reference thereto, and further agrees that said Plan
Administrator's duties shall include the merger of the
City's prior defined benefit plan with the new plan; conducting
employee meetings; enrolling new Participants; amending the
prior plan for compliance with Final Regulations prior to
merger; allocating assets of the prior plan among participants;
and such other duties as may be necessary to efficiently
administer the plan in the interests of the Participants and
the Employer, with such additional duties to include the
following:
Ca) Be responsible for keeping accurate books and
records with regpect to Participants, their compensation,
and the allocation of contributions, forfeitures and interest
to Participants' individual accounts.
A(b)_ Determine eligibility of any Participant.
(c). Determine the manner in which the funds of
the,Plan shall be disbursed in accordance with the provisions
of the Plan and Trust, including vested interests.
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(d) Notify each Participant annually following
the annual accounting and after notification by Employer of
the current contribution, of the value of each Participant's
account including the allocation of his account between
investments and insurance, if applicable.
(e) Direct the Trustee in writing as to investment
policy, includ
ing insurance, to retain, sell, exchange, buy
specified securities, including, but not limited to, stocks,
bonds, notes, debentures, mortgages, certificates Of deposit,
warrants and options, and real or personal property.
(f) Select insurer and determine type of annuity
to provide benefits as directed by Participant upon retirement
or termination.
(g) Select an Investment Manager if delegated
that power by Employer.
(h) Direct Trustee to make payments from the
Trust Fund to Participants who qualify for such payments.
Such payment shall specify the name of the Participant, his
Social Security Number, his address,.and the allocation
between taxable and non-taxable distributions.
(i) Be responsible for the determination of
Individual Accounts. Consultant need not segregate accounts
among Participants or among Employers for investment purposes
except as necessary for distribution.
2. Consultant shall not take action with respect to
any of the benefits provided under the Plan or otherwise
which would be discriminatory in favor of Participants who
are members of the Prohibited Group, or which would result
in benefiting one Participant, or group of Participants, at
the expense of another or would result in discrimination
between Participants similarly situated or would result in
the application of different rules to substantially similar
sets of facts.
M.M
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3. Consultant agrees to furnish the City monthly
reports of activities and all correspondence dealing with
said Plan.
4. The Plan Administrator's fee and any expenses are
to be paid from the earnings of the Trust Fund after approval
by the City. In consideration for services rendered by
Consultant under this Contract, City agrees to pay Consultant
from the Trust Fund, an amount equal to 1.39% of contributions,
employer and employee. Said compensation shall be paid to
Consultant monthly on or before the tenth (10th) day of each
month beginning one (1) month after the execution date
hereof.
5. The term of this Contract shall be for a period of
one (1) year commencing on the date of execution hereof.
6. Either party may terminate this agreement by giving
thirty (30) days written notice to the other party at said
party's last known mailing address.
cpSirizt
A04.412a2.
Poworms
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ATTEST:
2. Ccoadc,
Secreta
CITY OF FAYETTEVILLE, ARKANSAS
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KING, HALL & ASSOCIATES, INC.
By: /r5
/resident
•
THE
CITY OF FAYETTEVILLE
DEFINED CONTRIBUTION
MONEY PURCHASE PENSION PLAN
CITY OF FAYETTEVILLE
MONEY PURCHASE PENSION PLAN
INDEX OF PLAN AGREU/ENT
SECTION CONTENTS . PAGE
1 Name of Plan - Effective Date 1
2 Definitions 1
3 Plan Administrator 6
4 Participant 8
5 Employer and Employee Contributions 9
6 Allocation of Funds 11
7 Investment Account 14
8 Provision for Annuities 15
9 Retirement Benefits and Dates 17
10 Non -Forfeitable Rights -- Vesting 19
11 Death Benefits 22
12 Prohibition Against Diversion 23
13 Amendment of Plan •23
14 Termination of Plan 24
15 Claims Procedure 25
16 • Trust Fund arid Trustee 25
17 Miscellaneous Provisions 26
gi
y
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THE
CITY OF FAYETTEVILLE
DEFINED CONTRIBUTION PENSION PLAN AND TRUST
WHEREAS, the City of Fayetteville, Arkansas (hereinafter calle,d the
Employer), a Governmental Unit with its principal place of business in
Fayetteville, Arkansas, created on May 31, 1958, a Defined Benefit Pension Plan
and Trust as Restated and Amended 5/30/77, and
WHEREAS, the Employer now desires to adopt a Defined Contribution Money
Purchase Pension Plan and merge the prior Defined Benefit Plan into the Defined
Contribution Pian, with the Participants share of assets of the prior plan
representing the opening balances for the Participants in the successor
Defined Contribution Plan.
NOW THEREFORE, it is the intent of this Plan and Trust that:
1. No Participant in the prior plan shall receive less
at normal retirement age than he or she would have
received under the prior plan based on the 6/1/79
valuation;
2. To create a Trust to hold, invest, reinvest, and
otherwise to manage the assets of the Plan as
amended and restated;
3. To accept the assets of the prior plan as the opening
balances for the Participants in the successor plan.
The Trustee and the Employer, by joining in the execution of this
Plan and Trust Agreement, accept the responsibilities imposed on them and
agree to perform their duties under this Plan.
Section 1
Name of Plan — Effective Date
1.1 Name of Plan: The name of the Plan shall be the City of Fayetteville
Money Purchase Pension Plan.
1.2 Effective Date: The Plan shall become effective as of June 1, 1980.
Section 2
Definitions
2.1 Plan: The City of Fayetteville Money Purchase Pension Plan set forth
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herein as amended from time to time.
2.2 Trust Agreement: Trust Agreement shall mean the City of Fayetteville
Money Purchase Trust Agreement that is necessary for carrying out the
provisions of the Money Purchase Pension Plan with McIlroy Bank & Trust
as Trustee.
2.3 Trustee: McIlroy Bank & Trust of Fayetteville, Arkansas, and any
successor trustee under the City of Fayetteville Money Purchase Trust
Agreement, such trust being necessary to carry out the provisions of
the City of Fayetteville Money Purchase Pension Plan and Trust.
2.4 Limitation Year: The Plan Year.
2.5 Particieiant: An employee who is a participant in the Plan.
2.6 Compensation: The amount of base compensation, during a Plan Year, paid
or accrued to an a ployee, excluding overtime pay, bonuses, commissions,
expense account allowances and excluding Employer contributions to
this or any other retirement plan sponsored by Employer.
2.7 Predecessor Plan: The Defined Benefit Plan adopted in 1958 and which
is merged into the Defined Contribution Plan, as in 2.11.
2.8 Voluntary Contribution: The participants contributions in excess
of the 3% mandatory contribution as provided for, subject to the
limitations of Section 5.2(b).
2.9 Investment Account: The account as provided by Section 7.
2.10 Insurer: Any legal reserve life insurance company selected by the
Plan Administrator.
2.11 Prior Plan: The defined benefit plan that was adopted 5/31/58 as
amended and restated and which is to be terminated and merged with this
superseding money purchase plan and trust plan stated herein, as in 2.7.
2.12 Plan Year: The Plan Year shall be June 1 to May 31.
2.13 Plan Anniversary Date- Shall be June 1 of each Calendar Year.
2.14 Accounting Date: The last day of the Plan Year - May 31.
2.15 Service:
(a) Eligibility Computation Period: In the computation of service,
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the eligibility computation period shall be the Plan
Year.
(b) For purposes of eligibility and vesting, the first
computation period shall include the Anniversary of
the Employees first anniversary of the Date of Fire.
(c) Vesting Computation Period:. The vesting computation
period shall be the Plan Year.
2.16 Break in Service: Any Plan Year during which the participant
does not complete more than SOO Hours of Service with the
Employer.
2.17 Hour of Service:
(a) 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 501 Hours of Service shall
be credited under this paragraph for any Plan Year. Hours
under this paragraph shall be calculated and credited
pursuant to Section 2530.200b -2(b) and (c) of the
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Department of Labor Regulations which are incorporated
hereby by. this reference, and
(c) Each hour for which back pay, irrespective of mitigation
of damages, is either awarded or agreed to by the Em-
ployer. The same Hours of Service shall not be credited
both under Paragraph (a) or Paragraph (b), as thecasemay
be, and under this Paragraph (c). These hours shall 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.
(d) Where the Employer maintains the plan of,a predecessor
employer, service for such predecessor employer shall
be treated as serVice for the Employer.
2.18 Qualified Joint and Survivor Annuitv Shall mean an annuity
for the life of his/her spouse which is one-half the amount
of the annuity payable during the joint lives of the participant
and his/her spouse and which is the actuarial equivalent of
a single life annuity for the life of the participant.
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2.19 Defined Contribution Plan: The term "Defined Contribution
Plan" shall mean a plan which provides for an individual
account for each Participant and for benefits based solely
on the amount contributed to the Participants account, and
any income, expenses, gains and losses.
2.20 Employee: The term Employee shall mean any individual
employed by the Employer.
2.21 Fiduciary: The term Fiduciary shall mean and include the
Trustee, Plan Administrator, Employer, Investment Manager,
and any other person who:
(a) Exercises any discretionary authority or discretionary
control respecting Management of the Plan or exercising
any authority or control respecting management or
disposition of its assets;
(b) Renders investment advice for a fee or other compen-
sation, direct or indirect, with respect to any moneys
.or other property of the Plan, or has any authority or
responsibility to do so;
(c) Has any discretionary authority or discretionary res-
ponsibility in the administration of the Plan; or
(d) Is described as a "Fiduciary" in Section 3 (14) or (21)
of ERISA or is designated to carry out fiduciary,res-
ponsibilities pursuant to this Agreement to the extent
permitted by Section 405(d)(1)(B) of ERISA.
2.22 Investment Manger: The term "Investment Manager" shall
mean any Fiduciary (other than the Trustee or named Fiduciary)
who:
(a) Has the power to manage, acouire or dispose of any
asset of the Plan;
(b) Is a registered .4nvestment advisor, bank or Insurance
company; and
(c) Has acknowledged in writing that he is a fiduciary with
respect to the Plan.
2.23 Valuation Date: Valuation Date shall mean the same day as the
Plan Anniversary Date.
2%24 Year of Service: Eadh Computation Period in which an Employee
completes at least 1000 Hours of Service for Employer. For
purposes of determining Years of Service and Breaks in Service
for purposes of eligibility to participate in the Plan and
for purposes of determining a Participant's nonforfeitable
interest, the 12 consecutive month period shall commence on
the date the Employee first performs an HourofService for D ployer
and then be the Plan Year overlapping the anniversary of the employees
employment. No service performed as a partner or sole proprietor
shall be taken into consideration for any purpose under the Plan.
Where Employer maintains the plan of a predecessor employer, Years
of Service for such predecessor employer shall be treated as Years .
of Service for Employer.
Years of Service with other members of the Controlled Group of Cor-
porations or trades or businesses under common control are counted
for Vesting and Eligibility purposes.
Except as specifically stated otherwise in this 'agreement, for purposes
of dete?Mining a Participant's nonforfeitable vested interest in his
Accrued Benefit, the following shall apply: •
All Years of Service shall be counted.
2.25 Computation Date: That date on which eligibility requirements,
nonforfeitable rights, retirement, disability, death benefits and
allocating of contributions and accrued benefits are computed.
2.26 Participation Date: The term "Participation Date" shall mean each
June 1 of each Calendar Year. All employees who meet the Eligibility
Requirements specified in Section 4.1 on June 1, 1980, shall
participate as of that date as a result of the merger with the super-
seded defined benefit plan of said Employer.
2.27 Plan Administrator: The "Plan Administrator" shall be appointed by
employer with Plan Administrator as of 7/1/80 being King, Hall &
Associates, Inc
2.28 Actuarial Equivalent: Except to the extent expressly provided to
the contrary by ERISA, a benefit shall be actuarially equivalent
to any other benefit if the amount required to provide the same is
equal to the amount required to provide such other benefit
to be computed by reference to an annuity contract availabIe'at the
time of benefit determination from a life insurance company designated
by the Plan Administrator.
2.29 Named Fiduciarz: Employer - The Employer shall be the "Named Fiduciary"
with delegative authority, within the meaning of Section 402 of the
Employee Retirement Income Security Act of 1974 (hereinafter referred
to as ERISA) and shall be in charge of the operation and administration
• of the Plan. The Employer shall have the power to delegate specific
fiduciary responsibilities (other than those accepted by McIlroy
Bank & Trust as Trustee and Sponsor with respect to the control of
the assets of the Plan). Such delegations may be to officers or
employees.
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2.30 Accrued Benefit: The balance to the Credit of the Participants Account.
2.31 Participant: An Employee who has satisfied the Eligibility Require-
ments specified in Section 4.1.
Section 3
Plan Administrator
3.1 Plan shall be administered by a Plan Administrator (or Administrators)
appointed by Employer. A Plan Administrator may resign at any time
upon a delivery of a written resignation to Employer.
3.2 The Plart'Administrator shall serve with or without compensation as
mutually agreed with Employer, and such fees and expenses shall be
paid from investment income after approval by employer.
3.3 The Plan Administrator may make rules and regulations for the admin-
istration of the Plan and shall have the necessary or appropriate
authority to enable it to discharge its duties under the Plan.
3.4 Plan Administrator may employ, subject to approval of employer, such
administrative or professional assistance for proper administration of
the plan, with fees paid from investment income after approval by
Employer.
3.5 Plan Administrator may construe or interpret the Plan whenever
necessary to carry out its intention and purpose.
3.6 Plan Administrator shall keep accurate and detailed records of its
administration of Plan and shall make available to each Participant
its records as pertain to him and such other information and
records as prescribed by ERISA and Regulations.
3.7 Plan Administrator shall supervise and control the operation of the
Plan as specified herein: .
(a) Be responsible for keeping accurate books and records with
respect to Participants, their compensation and allocations of
contributions, forfeitures and interest to Participants in-
dividual account.
(b) Determine eligibility of any Participant.
(c) Determine the manner in which the funds of the Plan shall be
disbursed in accordance with the provisions of the Plan and
Trust, including vested interests.
(d) Notify each Participant annually following the annual accounting
and after notification by Employer of the current contribution,
of the value of each Participants account including the allo-
cation of his accounts between investments and insurance, if
applicable.
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(e) If other than Trustee, direct the Trustee in writing as to invest-
ment policy including insurance, to retain, sell, exchange, buy
specified securities, including, but not limited to, stocks,
bonds, notes, debentures, mortgages, certificates of deposit,
warrants and options, real or personal property.
(f) Select insurer and determine type of annuity to provide benefits
as directed by Participant upon retirement or termination.
(g) Select an Investment Manager if delegated that power by Employer.
(h) Shall direct trustee to make payments from the Trust Fund to
Participants who qualify for such payments hereunder. Such pay -
merits shall specify the name of the Participant, his Social
Security Number, his address, and the allocation between taxable
and non-taxable distributions.
(i) Shall not take action with respect to any of the benefits provided
hereunder or otherwise in pursuance of the powers conferred
herein upon the Plan Administrator which would be discriminatory
in favor of Participants who are members of the Prohibited
Group, or which would result in benefiting one Participant, or
group of Participants, at the expense of another or in discrimination
between Participants similarly situated or in the application
of different rules to substantially similar sets of facts.
The Trustee may request.Employer, in writing, or the Plan
Administrator, on any matters affecting the Trust and may rely
and act thereon.
(3)
(k) Shall be responsible for the determination of Individual Accounts,
and need not segregate accounts among Participants or among
Employers for investment purposes except as necessary for
distribution.
3.8 The original Plan Administrator shall be designated on the.Signature
Pages. The Plan Administrator shall serve until his resignation or
dismissal by the Board of Directors of the Employer and a vacancy
shall be filled in the same manner as the original appointment. The
Plan Administrator shall keep a permanent record of his actions
with respect to the Plan which shall be available for inspection
by appropriate parties as provided in the Code and ERISA.
3.9 Subject to the limitations of the Plan, the Plan Administrator shall,
from time to time, establish rules for administration of the Plan
and transaction of its business. The records of the Employer, as
certified to the Plan Administrator, shall be conslusive with respect
• to any and all factoral matters dealing with the employment of a
Participant. The Plan Administrator shall interpret the Plan and
shall determine all questions arising in the administration,
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interpretation and application of the Plan, and all such determinations
by the Plan Administrator shall be conclusive and binding on all
persons subject, however, to the provisions of the Code and ERISA.
Section 4
Participation
4.1 Eligibility Requirements:
(a) On the EffectiVe Date of this Plan, all present employees who:
(1) Are actively at work;
(ii) Agree to make the required contributions of 3% of
Compensation;
(iii) Have completed two years of service;
(iv) Attained at least age 20;
shall be eligible to participate in the Plan.
(b) Future employees will become eligible upon completion of the
above requirements and shall begin participation on the
Participation Date following completion of the above requirements.
(c) A terminated participant who later returns to the employ of the
Employer shall be eligible to participate on the first day of
his re-employment.
(d) A Participant whose employment is terminated before the end of
a Plan Year but after he has 1000 Hours of Service shall
not share in Employer Contributions for such Plan Year.
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4.2 Withip a reasonable period prior to the Effective Date or Plan An-
niversary Date on which an Employee will become eligible to participate,
Plan Administrator shall notify the Employee that he will become
eligible to participate if he remains in the employ of Employer until
such date. When an D ployee becomes a Participant, Plan Administrator
• shall deliver to him written evidence of such Participation and
notify Trustee.
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4.3 Leaves of Absence: Leaves of Absence may be granted by Employer on
a uniform non-discriminatory manner to Participants for reasons of
illness, vacation, vocational training or military service, provided
that leaves of absence for military service shall not be for more than
two years. The Participant shall be considered to be an Employee
during such leave of absence and D ployer shall continue to make
contributions on his behalf (based on his compensation, if any) to
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Trustee. If a Participant fails to return to the employ of the Employer
at the expiration of such leave of absence, he shall be deemed to have
terminated employment as of such expiration.
4.4 To become a Participant in the Plan, ah eligible Employee will be required
to contribute an amount equal to 3% of his compensation, complete an
enrollment form, designate a beneficiary and provide such other information
that may be required by the Plan Administrator.
4.5 All Participants shall be bound by the terms of the Plan, including all
amendments hereto made in the manner authorized herein. Participants
shall also be entitled to all the rights and privileges afforded thereby
including those• granted specifically by the Code and ERISA which are
hereby adopted by references as part of said Plan.
4.6 For purposes of determining Years of Service and -Breaks in Service for
purposes of eligibility, the initial 12 month period shall commence on
the date the employee first performs an Hour of Service for the employer.
The second 12 month period shall be the Plan Year which commences prior
t� the end of the initial 12 month period.
4.7 Once the employee elects to participate or not participate, his dollar
contribution, mandatory and voluntary, shall remain the same until the
next Plan Anniversary Date.
4.8 Withdrawals: A participant who withdraws from Participation in the Plan,
shall be precluded from again participating in the Plan until the second
Anniversary of the Plan following the withdrawal. However, participants
in the predecessor defined benefit plan who have withdrawn from said Plan
during the 6/1/79 to 5/31/80 Plan Year, may be eligible to participate
on the 6/1/80 Anniversary Date. They may "buy back" and restore their
benefits as provided in Section 17.9.
Section 5
Employer and Employee Contributions
5.1 Employer Contributions:
(a) For each taxable year of Employer, D ployer shall contribute to
Trustee, for the purposes of the Plan, an amount equal to 6% of the
base compensation of the Participant.
(b) A Participant whose employment is terminated before the end of a
Plan Year after he has completed 1000 Hours of Service shall not
share in employers share of contributions for such Plan Year.
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(c) Forfeitures: Forfeitures, if any, shall be used to reduce
employers contributions. The Employers determinations of such
contributions shall be binding on all Participants, Plan
Administrator, and Employer. Such determination shall be
final and conclusive subject to Section 14.5 and shall not
be subject to change as a result of any subsequent adjust-
ments in Employers records. However, the Employer, at
its discretion, may take into consideration all or any part
of such adjustments for the succeeding years contribution.
5.2 Employee Contributions:
(a) Eligible employees who desire to participate in the Plan shall
be required to contribute 37. of the base compensation. A
participants mandatory contributions may be made by regular
payroll deductions, or any method approved by Employer.
Participant contributions shall be remitted to the Trustee
monthly.
(b) Additional voluntary contributions shall be permitted, in-
cluding a qualified Rollover of Assets from another qualified
plan and the predecessor Defined Benefit Plan.
Voluntary contributions, other than rollover IRA's and transfer
of the predecessor plans assets shall be limited to 10% of the
Participants base compensation for all qualified plans in which
the participant may be participating.
5.3 The Plan Administrator shall provide the employees who become
eligible a form on which the employee shall elect to participate
or not to participate and if electing to participate, the form
will authorize the payroll deduction. The form shall be given to
the employee at least 30 days prior to the Plan Anniversary. Date
and shall be returned to the Plan Administrator at least 15 days
prior to the Plan Anniversary Date. Once the election is made as
to whether or not to participate, the provisions of Section 4.7
shall apply.
5.4 The Trustee shall be accountable for all Participant contributions
received, but shall have no duty to require that the contributions
be delivered nor to determine that the contributions received
are for the correct amount or are correctly attributable to the
participants who made them.
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Section 6
Allocation of Funds
Employer and Emoloyee Contributions, Forfeitures, if any, and Investment Income:
6.1 As of each Anniversary Date, Employer shall promptly notify the Trustee
and Plan Administrator, in writing, the date of and the amount of the
Employer and Employee Contributions, including forfeitures for the Plan
Year just ended. The Employer Contributions shall be allocated among those
Participants who have completed at least one thousand (1000) hours during
the Plan Year and who are still employed on the Anniversary Date.
6.2 Forfeitures: Plan Administrator shall determine and record all forfeitures
that arise as a result of termination of service of a Participant and
shall be accumulated until the Anniversary date following a break in
service, and shall reduce the Employers Contributions.
6.3 Forfeitures shall not be used to reduce employers contribution until
the terminated Participant has incurred a one-year Break in Service.
6.4 Separate Accounts: Individual accounts shall be established for each
participants accrued benefits. Such accounts shall distinguish between
Employer and Employee contributions and investment income thereon and
any Rollover of assets from another Plan.
6.5 Investment Income: Investment Income, as defined in Section 7 below,
shall be allocated on a proportionate basis as determined in Section
7.3 and 7.4.
6.6 Computation Date: The Computation Date for allocation of contributions
and investment income shall be the anniversary date of the Plan, with such
allocations in proportion to the Participants compensation to all compen-
sation during the Plan Year ended.
6.7 Limitation on Allocations: Section A(1) through A(4) - These Sections_
apply to Employers who do not maintain any qualified plan addition
to this Plan.
A (1) If an Employer does not maintain any other qualified plan, the
amount of the Annual Additions which may be allocated under this
plan on a participants behalf for a Limitation Year shall not
exceed the lesser of the Maximum Permissible Amount oi any other
limitation contained in this Plan.
A (2) Prior
sation
may be
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annual
to the determination of the participants actual compen-
for a Limitation Year, the Maximum Permissible Amount
determined on the basis of the participants estimated
compensation for such Limitation Year. Such estimated
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annual compensation shall be determined on a reasonable basis
and shall be uniformly determined for all participants similarly
situated. Any employer contributions (including allocation of
forfeitures) based on estimated annual compensation shall be
reduced by any Excess Amounts carried over from prior years.
A (3) As soon as is administratively feasible after the end of the
Limitation Year, the Maximum Permissible Amount for such Limi—
tation Year shall be determined on the basis of the participants
actual compensation for such Limitation Year.
A (4) If, pursuant to Section A(1) there is an Excess Amount with
respect to a participant for a Limitation Year, such Excess
Amount shall be disposed of as follows:
(0 In the event that the participant is (in the service of the
employer which is covered by the Plan) at the end of the
Limitation Year, then such Excess Amounts must not be
distributed to the participant, but shall be reapplied to
reduce future employer contributions under this Plan for
the next Limitation Year for such participant, so that in
each such year the sum of actual employer contributions
plus the reapplied amount shall equal the amount of employer
contributions.
(ii) In the event that the participant is not (in the service of
the employer which is covered by the Plan) at the end of the
Limitation Year, then such Excess Amounts must not be dis—
tributed to the participant but shall be reapplied to reduce
future employer contributions for all remaining participants.
Sections B(1) through B(6) — These Sections apply to Employers who, in
addition to this Plan, maintain one or more Plans, all of which are
qualified Master or Prototype defined contribution plans.
B (1) If, in addition to this Plan, the Employer maintains any other
qualified defined contribution plan (all of which are qualified
Master or Prototype Plans), the amount of Annual Additions which
may be allocated under this Plan on a participants behalf for
a Limitation Year, shall not exceed the lesser of:
The Maximum Permissible Amount, reduced by the sum of any
Annual Additions allocated to the participants accounts for
the same Limitation Year under this Plan and such other
defined contribution plans; or
(ii) Any other limitation contained in this Plan.
B (2) Prior to the determination of the participants actual compensation
for the Limitation Year, the amounts referred to in 13(1)0) above,
may be determined on the basis of the participants estimated
annual compensation for such Limitation Year. Such estimated annual
compensation shall be determined on a reasonable basis and shall
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3
be uniformly determined for all participants similarly situated.
Any employer contribution (including allocation of forfeitures)
based on estimated annual compensation shall be reduced by any
Excess Amounts carried over from prior years.
B (3) As soon as is administratively feasible after the end of the
Limitation Year, the amounts referred to in B(1)(i) shall be
determined on the basis of the participants actual compensation
Lor such Limitation Year.
B (4) If a participants Annual Additions under this Plan and all such
other plans result in an Excess Amount, such Excess Amount shall
be deemed to consist of the Amounts last allocated.
B (5) Ft an Excess Amount was allocated to a participant on an allo-
cation 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 (including
any amount which would have been allocated but for the
limitations of Section 415 of the Code), times
(ii) The ratio of (a) the amount allocated to the participant as of
such date under this Plan, divided by (b) the total amount
allocated as of such date under all qualified defined contri-
bution plans (determined without regard to the limitations
of Section 415 of the Code).
B (7) Any Excess Amounts attributed to this Plan shall be disposed of
as provided in Section A(4).
Section C - This Section applies only to Employers who, in addition
B o this Plan, maintain one or more qualified plans which are qualified
defined contribution plans other than a Master or Prototype Plan.
If the Employer also maintains another plan which is a qualified
defined contribution plan other than a Master or Prototype Plan,
annual additions allocated under this Plan on behalf of any
participant shall be limited in accordance with the provisions of
Sections B(1) through B(6) as though the other plan were a
Master or Prototype Plan.
Sections D(1) through D(6) (Definitions) - For purposes of this Section,
the following terms shall be defined as follows:
D (1) Annual Additions: The sum of the following amounts allocated
on behalf of a participant for a Limitation Year:
(i) All employer contributions;
(ii) All forfeitures; and
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(iii) The lesser of (a) one-half of all employee contributions,
and (b) the amount of all employee contributions in excess
of 6 percent of such participants actual compensation.
For the purposes of this Section, amounts reapplied to
reduce employer contributions under Section A(4) shall
also be included as Annual Additions.
D (2) Employer: The Employer that adopts this Plan. In the case of
a group of employers which constitutes a controlled group of
corporations (as defined in Section 414(b) of the Code as modified
by Section 415(h)) or which constitutes trades or businesses
(whether or not incorporated) which are under comium control
(as defined in Section 414(c) as modified by Section 415(h)),
all such employers shall be considered a single employer for
purposes of applying the limitations of this article.
D (3) Excess Amount: The excess of the participants Annual Additions
for the Limitation Year over the Maximum Permissible Amount,
less loading and other administrative charges allocable to such
excess.
D (4) Limitation Year: A calendar year (or any other 12 consecutive
month period adopted for all plans of the employer pursuant to
a written resolution adopted by the employer).
D (5) Master or Prototype Plan. A Plan the form of which is the sub-
ject of a favorable opinion letter from the Internal Revenue
Service.
D (6) Maximum Permissible A: unt: For a Limitation Year, the Maximum
Permissible Amount with respect to any participant shall be the
lesser of (a). $25,000 (or such larger amount as may be prescribed
by the Secretary of the Treasury or his delegate), or (b) 25
percent (25%) of the participants compensation for the Limitation Year.
Section 7
Investment Account
7.1 Employer contributions, including any forfeitures, subject to Section
6.3, and IN ployee contributions credited to the Participants Account
shall be allocated to the Participants Individual Investment Account
and invested by Trustee as directed by the Plan Administrator as provided
in Section 3.7(e). The aggregate individual accounts shall be known as
the "Investment Account."
7.2 Trustee shall keep separate records of contributions by or on behalf of
Participants and shall, in accordance with the provisions of this
agreement, value on the basis of fair market value of Individual
Investment Account of each Participant at least annually as of each
Anniversary Date or at such other times as is necessary in order to
determine or pay benefits. If interim valuation adjustments are made,
all Participants shall be treated in a like manner.
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