HomeMy WebLinkAboutAgenda Report - May 17, 1995 (33)� OF
CITY OF LODI
COUNCIL COMMUNICATION
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AGENDA TITLE: Approve ITT Hartford Life Insurance Company as a Deferred Compensation Provider
MEETING DATE: May 17, 1995
PREPARED BY: Assistant City Manager
RECOMMENDED ACTION: The City Council approve the enclosed Administrative Services Agreement and
Deferred Compensation Plan with ITT Hartford Life Insurance Company to
provide deferred compensation services to City of Lodi employees.
BACKGROUND INFORMATION: The City of Lodi presently offers two providers for deferred compensation
services - Great Western and ICMA. Each of these options has some decided
advantages, depending upon the needs of the individual. Great Western offers
a saving plan that is insured by the federal government up to $100,000 per
individual. ICMA offers a more diversified portfolio of investment options and grater portability. Neither of the two
providers offers an annuity plan upon retirement which guarantees that the retiree will not outlive the funds available.
ITT Hartford has made at least two presentations to the City's Deferred Compensation Committee relative to the
investment opportunities offered and the services provided. The Deferred Compensation Committee recommends
the City Council approve ITT Hartford Life Insurance Company as a third provider for deferred compensation. The
Committee does this for three reasons, as follows:
1. ITT Hartford's educational services are extensive, which will provide City employees with additonal data to
assist them when planning for retirement
2. ITT Hartford offers a series of annuity plans for retirees
3. City employees who wish to transfer to ITT Hartford will receive a three percent bonus
ITT Hartford provides deferred compensation services to a number of municipalities and governmental agencies in
California. One of their local clients is County of San Joaquin who reports it is well satisfied with its arrangements
with ITT Hartford.
The City Council is requested to authorize the City Manager to execute the attached Administrative Services
Agreement (Exhibit A) and to adopt the Deferred Compensation Plan (Exhibit B) provided by ITT Hartford.
FUNDING: None required
Respectfully submitted,
L, erry L. Glenn
Assistant City Manager
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APPROVED:
THOMAS A. PETERSON
City Manager
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ADMINISTRATIVE
SERVICES
AGREEMENT
A'A
ITT HARTFORD
Introduction
Hartford Life Insurance Company ("ITT Hartford") is a stock life insurance company
organized under the laws of the State of Connecticut. It is a member of ITT Hartford
Insurance Group.
ITT Hartford staff responsible for Deferred Compensation Plan Administration has the
expertise necessary to support the requirements of your Plan. This expertise, developed
over the years, spans the highly technical areas of tax withholding and reporting, data
processing and general Variable and Fixed annuity administration.
T'ie Company actively entered the Deferred Compensation market and began specializing
in State and Municipal Deferred Compensation Plans in 1973. Since that time, it has grown
to become an industry leader in new premium writings and is a consistent innovator in the
development of new contract provisions and simplified administrative capabilities to benefit
Deferred Compensation Plan Employers as well as Participants.
(A)
Deferred Compensation Plan Administration
ITT Hartford will allocate deferrals to Participant Individual Accounts in accordance with the
instructions provided by the Contract Owner and pursuant to the Deferred Compensation
Plan. In addition, ITT Hartford will agree to assume certain responsibilities and provide
services which would otherwise be the obligation of the Employer.
This proposal provides a general description of such services which include the following:
1. A convenient method is available for the electronic transmission of data between
the Employer and ITT Hartford. Tape to tape system processing of payment
deductions is another option that is available.
2. ITT Hartford will provide appropriate reports for both the Employer and the
Participant.
3. Disbursement of all benefits, including retirement payments and withdrawals, will
be made directly to the Participant.
4. All Federal and State taxes will be withheld as required and forwarded directly to
the applicable taxing authority.
5. A report of such taxes will be provided to the Employer and Participants.
6. ITT Hartford will prepare the appropriate tax reporting forms and mail them directly
to the Participants, with copies to the Employer and the applicable taxing authorities
one month after the close of the calendar year.
(B)
Implementation
1. Execute an Administrative Services Agreement
The purpose of the Administrative Services Agreement is to define those services which
ITT Hartford will assume on behalf of the Employer.
2. Establish Lines of Communication
Designate an individual by the Employer to act in its behalf and to serve as coordinator
with ITT Hartford.
3. Develop Procedures to Implement Provisions of Agreement
Establish the appropriate percentage for State and Local Withholding taxes as applicable
to Annuity Benefit Payment and Withdrawals.
Develop reporting requirements.
Service
ITT Hartford recognizes the need and desirability to service the Deferred Compensation
Plan on a special attention basis. To that end, an Account Services Unit, at ITT Hartford is
responsible for working directly with you to provide services on a priority basis.
The Account Services Unit is located in ITT Hartford's Home Office at (203) 843-8270, or
1-(800) 528-9009, Option 2.
Address correspondence to:
ITT Hartford Life Insurance Company
P.O. Box 2999
Hartford, Connecticut 06104-2999
Attention: Director
Account Services Department
Asset Management Services/RPVA.
Tax Withholding Services
1. Tax Withholding Transactions
Such transactions include payment of Contract Values resulting from termination of
employment prior +o retirement, hardship withdrawals, and retirement benefits (lump
sum or annuity payments).
(C)
Tax Withho/ding Services (continued)
2. Amount Withheld
A percentage of the proceeds, as specified by the Employee's filing status, will be
withheld for Federal and State Taxes, if any. Appropriate percentages will be withheld
for Annuity Benefit Payments and Withdrawals.
3. Transmittal of Taxes Withheld
A detailed report, along with a check representing the amount of taxes withheld for the
prior month, will be forwarded directly to the applicable taxing authority, with a copy to
the Employer within the time frame prescribed by law.
4. Taxpayer Reporting
A record of the amounts withheld for taxes will be provided to the recipient at the time
an annuity benefit or withdrawal payment is sent.
One month after year end, the appropriate tax reporting form(s) will be prepared by
ITT Hartford and mailed directly to the Participants. Appropriate copies of the forms with
the ledger records will be mailed to the Employer and the applicable taxing authorities.
Additional Reports
1. Confirmations
A. Individual Confirmations
Exchange confirmations are produced for each Participant's request to transfer
accumulated contributions between funds. All financial data relating to the transaction
is displayed on the form. Exchange confirmations are mailed directly to the
Participant.
Address changes, name changes and allocation changes produce confirmations
which are mailed directly to the individual Participant.
B. Group Confirmations
Quarterly confirmations are mailed to the Contract Owner, five business days after
the end of each quarter. The Quarterly Confirmation Report includes all contribution
and participant activity generated during the quarter plus quarter end account
values. A Group Summary Report appears at the end of the Quarterly Confirmation
Report, which summarizes the financial activity for the quarter.
2. Statement of Account (Quarterly)
This is the status of the account as of the end of the reporting period. Under the terms
of the Administrative ServiceF Agreement, this report can be mailed directly to the
Participant or as directed by the Employer.
(D)
Administrative Services Agreement
1.0 The Agreement
1.1 This Administrative Services Agreement (ASA) is made and entered into by and
between City of T,odi and Hartford Life Insur-
ance Company, a Connecticut corporation and its affiliates (referred to herein
as "ITT Hartford"). This ASA is separate and distinct from the Annuity Contract
entered into between the same parties described in Subsection 2.1.3.
1.2 The intent of this ASA is to facilitate the administration of the
ri ty of T.odi Deferred Compensation Plan as it pertains
to accounting for deferrals, the disbursement of funds, and withholding of taxes
and the proper reporting to participants, annuitants, and governmental agen-
cies.
1.3 The services rendered by ITT Hartford pursuant to this ASA shall be performed
at no additional cost to the Contract Owner.
2.0 Definitions
2.1 Unless this ASA expressly provides otherwise, the following definitions shall
apply herein.
2.1.1 "Contract Owner" means City of Lodi
2.1.2 "Plan" means the Contract Owner's Deferred Compensation Plan.
2.1.3 "Participant" means an employee of the Contract Owner electing to
participate in the Deferred Compensation Plan and former employees
for whom an account underThe Plan and Annuity Contract is maintained.
2.1.4 "Annuity Contract" means the Group Annuity Contract(s) between
the Contract Owner and ITT Hartford. This Annuity Contract is separate
and distinct from the ASA described in Subsection 1.1.
3.0 Term
3.1 This Agreement shall be effective immediately upon execution by both parties
and shall remain in force until terminated by either party as provided herein.
(t)
Administrative Services Agreement (continued)
4.0 Relationship of the Parties
4.1 ITT Hartford shall perform its obligations hereunder as agent for the Contract
Owner and only in accordance with instructions received from those persons
authorized to act on behalf of the Contract Owner as specified to ITT Hartford
in writing.
4.2 The Contract Owner shall not supervise or direct ITT Hartford other than as
expressly provided in this agreement.
5.0 Services to be Performed
5.1 The Contract Owner shall notify ITT Hartford in writing of the Participants
entitled to receive disbursements under the terms of the Plan.
5.2 ITT Hartford shall issue the disbursements to the Participants in accordance
with the provisions of the Annuity Cont, -ict and the Plan.
5.3 Disbursements shall be made from the account maintained under the Annuity
Contract in accordance with the terms of the Annuity Contract and the Plan to
the extent funds are available.
5.4 ITT Hartford shall compute and deduct from the disbursements all appropriate
Federal and State income taxes required by law to be withheld from Plan
distributions by the Contract Owner in accordance with Federal and State law,
ordinance or regulation governing tax withholding reporting. A detailed report
regarding such withheld taxes will be forwarded by ITT Hartford to the
applicable taxing authority, with a copy to the Contract Owner, within the time
frame prescribed by law.
5.5 ITT Hartford shall furnish annually to all Participants receiving benefits under
the Annuity Contract and the Plan the tax reporting form(s) required by the
applicable taxing authority within the time frame prescribed by law.
5.6 Utilizing ITT Hartford's tax identification number, withheld taxes will be remitted
to the appropriate Federal and State taxing authority.
6.0 Financial Management System
6.1 ITF Hartford shall establish and maintain a financial management system for
the purposes of this agreement in accordance with generally accepted account-
ing practices and procedures including, for each disbursement:
6.1.1 A record of all notifications from the Contract Owner concerning
Participants who are to receive disbursements per Article 5.0 of this
ASA.
(2)
Administrative Services Agreement (continued)
6.1.2 Statements of gross disbursements under Article 5.0 of this ASA.
6.1.3 Statements of all Federal and State income taxes withheld under
Article 5.0 of this ASA.
6.1.4 Records of all income taxation reports filled with the Federal and State
governments on behalf of the Contract Owner.
7.0 Financial Reporting and Audits
7.1 ITT Hartford shall furnish directly to the Participant:
7.1.1 A statement of gross disbursement made under Article 5.0 of this ASA,
including the amount of Federal and State taxes withheld and the net
amount paid with each disbursement to a Participant.
7.1.2 A confirmation of Fund Exchanges, Allocation Changes, Name and
Address Changes.
7.2 ITT Hartford shall furnish to the Contract Owner:
7.2.1 A report containing a statement of each and every disbursement made
under Article 5.0 of this ASA which includes the amount of Federal and
State taxes withheld pursuant to Subsection 5.4.
7.2.2 A Quarterly Confirmation Report including all contribution and Partici-
pant activity generated during the quarter plus quarter end account
values.
7.2.3 A quarterly Group Total Page summarizing the financial activity for the
quarter.
8.0 Records Management
8.1 Except as otherwise provided herein, ITT Hartford shall retain all financial
records and supporting documents, correspondence and otherwritten materials
pertaining to the Annuity Contract, Plan and any Federal and State income tax
withholding for three years following the date of termination of this ASA. ITT
Hartford may retain such records and documents on microfilm, microfiche,
optical storage, or any other process which accurately reproduces or forms a
curable medium for reproducing the original. Contract owner has the right to
make duplicate copies at Contract owner's expense.
8.2 If an audit by, or on behalf of, the Contract Owner has begun but has not been
completed at the end of the three-year period, or if audit findings have not been
resolved at the end of the three-year period, ITT Hartford shall retain the records
described in Subsection 8.1 until audit findings are resolved.
(3)
Administrative Services Agreement (continued)
8.3 If, for any reason, ITT Hartford ceases operations prior to the expiration of the
records retention period required by this section, all records described in
Subsection 8.1 shall, upon request of the Contract Owner, be made available
to the Contract Owner.
8.4 If ITT Hartford fails to reasonably protect records from fire, theft, damage,
deterioration or any other type of loss during the required period of retention,
the Contract Owner has the right to make duplicate copies of all records in
danger of being lost, destroyed or damaged.
8.5 Upon reasonable written request and during normal business hours, ITT
Hartford shall allow the Contract Owner full and complete access to all records
required to be retained by ITT Hartford.
8.6 The Contract Owner shall have the right upon reasonable notice in writing,
exercised directly or through its independent auditors, to examine and audit
ITT Hartford's records to determine ITT Hartford's compliance with the terms
and conditions herein.
9.0 Termination
9.1 This agreement may be terminated without any further liability of either party for
any obligation maturing subsequent to the date of such termination, upon 60
days written notice to the other party.
9.2 Within 90 days of termination of this agreement, ITT Hartford shall deliver to the
Contract Owner any reports required by this Agreement, which have not
already been provided.
9.3 Termination of the Annuity Contract will not affect any obligation of ITT Hartford
under Section 5.0 of this ASA to Participants who have become entitled to
payments underthe Annuity and the Plan priorto the termination of the Annuity
Contract.
10.0 Nondiscrimination
10.1 ITT Hartford agrees to comply with nondiscrimination and affirmative action
requirements applicable to ITT Hartford due to its status as a contractor under
this agreement.
11.0 Nonwaiver
11.1 The failure of the Contract Owner or ITT Hartford at any time to enforce a
provision of this agreement shall in no way constitute a waiver of the provision,
nor in any way affect the validity of this agreement or any part hereof, or the right
of the Contract Owner of ITT Hartford thereafter to enforce each and every
provision thereof.
(4)
Administrative Services Agreement (continued)
12.0 Assignments
12.1 Any attempted assignment of this agreement, or any part of it, without the
written consent of the other party shall be void. However, ITT Hartford may
assign its rights and obligations under this ASA to an affiliate or subsidiary
company without the written consent of Contract Owner.
13.0 Amendment
13.1 The parties may amend this agreement only bywritten agreement and approval
by the President, Vice President or an Assistant Vice President of Hartford Life
Insurance Company and an authorized person for the Contract Owner.
14.0 Notices
14.1 Any notices provided for herein shall be in writing and shall be deemed to have
been given when received by:
14.1.1 United States mail addressed as follows:
Contract Owner: City of Lodi
221 West Pine :.Street
Lodi, CA =95240
Agent: Assistant Vice President
Asset Management Services
ITT Hartford Life Insurance Company
P.O. Box 2999
Hartford, CT 06104-2999
14.1.2 Personal delivery addressed as follows:
Assistant Vice President
Asset Management Services
ITT Hartford Life Insurance Company
200 Hopmeadow Street
Weatogue, CT 06089
14.1.3 To such other persons at such other addresses which the Contract
Owner or Agent may, from time to time, designate in writing.
(5)
Administrative Services Agreement (continued)
15.0 Indemnification
15.1 The Contract Owner agrees to indemnify and hold harmless ITT Hartford from
any and all losses, damages or liability that ITT Hartford may incur as the result
of any negligent action on the part of the Contract Owner, its agents or
employees, including, but not limited to, losses resulting from incorrect or
untimely information given to ITT Hartford by the Contract Owner.
15.2 ITT Hartford agrees to indemnify and hold harmless the Contract Owner for any
loss arising from ITT Hartford's failure to perform its duties and service pursuant
to this Agreement.
16.0 Jurisdiction: Choice of Law
16.1 The Law of the State of California shall govern the rights and
obligations of the parties under this agreement.
17.0 Integration
17.1 This instrument and any written appendices and amendments hereto embody
the entire agreement of the parties. There are no promises, terms, conditions
or obligations other than those contained herein and this agreement shall
supersede all previous communications, representations oragreements, either
oral or written, between the parties hereto with respect to this agreement.
IN WITNESS WHEREOF, the parties hereto have caused this agreement to be signed.
Date:
ITT HARTFORD LIFE INSURANCE COMPANY
By: Date:
Barbara D. Coppen, Assistant Vice President
ASSET MANAGEMENT SERVICES
(6)
4/95
Master Application for
Individually Allocated Group
Variable Annuity Contract
Hartford Life Insurance Company
Hartford Plaza
Hartford, Connecticut 06115
THE HARTFORD . ,.
The Insurance People of ITT
Application is hereby made for an Individually Allocated Group Variable Annuity Contract:
1. Applicant -Contract Owner:
City of Lodi
221 West Pine Street
Street or P.O. Box
Lodi CA 95240
City State Zip Code
2. Nature of Applicant's Business: Mien i r i na 1 i t y
3. Requested Effective Date of Master Contract: June 1- 1995
4. Special Requests: Section 21
It is understood that all payments and values provided by the Contract are the exclusive property of the Applicant -
Contract Owner and when based on the investment experience of a Separate Account, are variable and not
guaranteed as to fixed dollar amount.
Dated at LLQ ri i , r. A this day of , 19
For City of Lodi
(Contract Owner)
By
Registered Representative (Licensed Agent)
(Title)
Form HVL -10001-0 Printed in U.S.A.
DEferred Compensati®n Plan
AMS/Twentieth Century Investment Options
AMS/Twentieth Century Select Investors Fund Account W&
AMS/Twentieth Century Ultra Investors Fund Account
AMS/Twentieth Century Balanced Investors Fund Account ITT HARTFORD
AMS/Fidelity Advisor Investment Options
AMS/Fidelity Advisor Income & Growth Fund Account
AMS/Fidelity Advisor Growth Opportunities Fund Account
AMS/Fidelity Advisor Strategic Opportunities Fund Account
AMS/Fidelity Advisor Overseas Fund Account
The above -referenced investment options are being made available to your Deferred Compensation Plan under
an exemption granted to Hartford Life Company by the United States Securities and Exchange Commission
("SEC"). In granting that exemption, the SEC requires that we receive the following representations from you
in writing:
no plan assets represent monies contributed under an annuity contract established under Section
403(b) of the Internal Revenue Code;
2. the plan is for the exclusive benefit of employees or their beneficiaries;
3. the purpose of the plan is to distribute all assets accumulated under the plan to your employees or their
beneficiaries;
4. no plan assets shall be used other than for the exclusive benefit of your employees or their
beneficiaries prior to the satisfaction of all plan liabilities to the employees and their beneficiaries,
except that plan assets will remain subject to the claims of general creditors to the extent necessary to
preserve qualification of the plan under Section 457 of the Internal Revenue Code; and
5. no employee contributions to the plan will be invested in securities of the employer or its controlled or
commonly controlled entities.
Please acknowledge the above representations by signing the enclosed acknowledgment and return by mail to
The Hartford Life Insurance Company in the envelope provided for your convenience.
ACKNOWLEDGMENT
I HAVE READ AND AGREE WITH THE PRESENTATION$ CONTAINED IN THE FOREGOING LETTER.
------------------------------------ ------- ------------------------- --
Signature Date Printed Name
On Behalf Of:
Citv of Lodi
Name of Employer/Contract Holder
221 West Pine Street
..........
Street Number and Name/PO Box
Lodi, CA 95240
--------------------
City, State, Zip Code .
----------------------------
457 TCP Contract Number
CITY OF LODI
DEFERRED COMPENSATION PLAN
COPYRIGHT
1992
HARTFORD LIFE INSURANCE COMPANY
ALL RIGHTS RESERVED
(i)
5/94 Rev.
a
,or
Deferred Compensation Plan
CONTENTS
Section 1 General
1.1 Name of the Plan ......................................... 1
1.2 Purpose of the Plan ...................................... 1
Section 2 Definitions
2.1 Administrator ............................................ 2
2.2 Allowable Life Expectancy ................................ 2
2.3 Annuity .................................................. 3
2.4 Beneficiary .............................................. 3
2.5 Code ..................................................... 3
2.6 Committee ................................................ 3
2.7 Compensation ............................................. 3
2.8 Contract ................................................. 3
2.9 Deferred Compensation .................................... 4
2.10 Deferred Retirement Date ................................. 4
2.11 Eligible Deferred Compensation Plan ...................... 4
2.12 Employer ................................................. 4
2.13 Employee ................................................. 4
2.14 Includible Compensation .................................. 4
2.15 Investment Provider ...................................... 4
2.16 Normal Retirement Date ................................... 5
2.17 Participant .............................................. 5
2.18 Participation Agreement .................................. 5
2.19 Participation Account .................................... 6
2.20 Plan Year ................................................ 6
2.21 Termination of Employment ................................ 6
2.22 Unforeseeable Emergency .................................. 6
(ii)
,r
Deferred Compensation Plan
CONTENTS (CONTINUED)
Section 3 Operation of the Plan ................................. 6-14
Section 4 Investment Responsibilities .......................... 14-16
Section 5 Distributions ........................................ 17-26
Section 6 Beneficiary .......................................... 26-27
Section 7 Non -Assignability .................................... 27
Section 8 Plan Transfers ...................................... 28-30
Section 9 Administration and Recordkeeping ..................... 30-33
Section10 Amendments ........................................... 33-34
Section 11 Employer Asset ....................................... 35
Section 12 Miscellaneous ........................................ 36-37
Signature Page ................................................... 38
Definition of Eligibility to Participate is Plan.......... Attachment A
I
.r
DEFERRED COMPENSATION PLAN
SECTION 1
General
1.1 The "Name" of this Plan is the City of Lodi
Deferred Compensation Plan, referred to throughout this Plan
Document as the "Plan". It has been adopted pursuant to
and is effective as of
1.2 The primary "Purpose" of this Plan is to permit eligible
Employees (as defined in Attachment A) with the
City of Lodi to enter into an agreement which
will provide for deferral of payment of a portion of their
current compensation until retirement, separation of service,
death, approved unforeseeable emergency or other event, in
accordance with the provisions of Section 457 of the Internal
Revenue Code of 1986, with other applicable provisions of such
3
Code, and with applicable sections of the General Statutes of
the State of California
(1)
�~ 1.3 The Employer does not and cai:not represent or guarantee that any
particular Federal or State income, payroll or other tax
consequence will occur by reason of participation in this Plan.
A Participant should consult with his or her own attorney or
other representatives regarding all tax or other consequences of
participation in this Plan.
SECTION 2
For purpose of this Plan, the following words and phrases shall have
the meaning set forth below:
2.1 "Administrator" means the Employer (not the Investment
Provider(s)) or its duly authorized designee.
2.2 "Allowable Life Expectancy" means the Participant's applicable
single life expectancy; the joint (spousal) life expectancy; the
spousal life expectancy (Beneficiary) as set forth in the life
annuity actuarial tables (Code Section 72 and Regulations
thereunder).
3
(2)
2.3 "Annuity" means a series of Investment Contract payments, at
equal intervals, that provide income for life or for a
designated period.
2.4 "Beneficiary" means any person designated by the Participant to
receive a benefit under the provisions of this Plan, by reason
of the Participant's death.
2.5 "Code" means the Internal Revenue Code of 1986, as amended.
2.6 "Committee", also known as the Deferred Compensation Committee,
shall mean the persons appointed by the Employer, designated by
ordinance, statute, etc. to administer and govern the operation
of the Plan.
2.7 "Compensation" means the total of all wages or salaries which
are paid by the Employer to, or for the benefit of, an Employee
for services rendered, calculated without deduction for any
portion thereof deferred under the provisions of this Plan or
for any amounts contributed to any program established pursuant
to Code Sections 403(b), 401(k), 408(k)(6) or 501(c)(18).
2.8 "Contract" as referred to in this Plan means a Fixed and/or
Variable Contract issued by The Hartford Life Insurance Company.
(3)
f 2.9 "Deferred Compensation" means that portion of an Employee's
Compensation which said Employee has elected to defer in
accordance with the provisions of this Plan.
2.10 "Deferred Retirement Date" means the date beyond the Normal
Retirement Date specified in Section 2 (2.16) which is
designated by the Participant. Such date shall not exceed April
1 of the year following the attainment of age 70 1/2.
2.11 "Eligible Deferred Compensation Plan" has the meaning given it
by the Internal Revenue Code Section 457 and the regulations
thereunder.
2.12 "Employer" means the City of Lodi
2.13 "Employee" means any individual defined as eligible by standards
set forth by the Employer. A copy of such standards is attached
as Attachment A and incorporated as if fully set forth.
2.14 "Includible Compensation" means Compensation from the Employer
that is currently includible in gross income for Federal income
tax purposes.
2.15 "Investment Provider" means Employer or its duly authorized
designee for the purpose of providing investment alternatives.
(4)
2.16 "Normal Retirement Date" means the last day of the month in
which a Participant retires pursuant to the Employer's
Retirement Plan. (Such age may be no later than age 70 1/2 and
no earlier than the earliest age at which a Participant has the
right to retire under the Employer's basic pension plan, without
consent of the Employer, and to receive immediate retirement
benefits without actuarial or similar reduction.)
Normal Retirement Date for "Catch-up" purposes means any date
selected by a Participant, as his/her retirement date, only for
the purpose of utilizing the "Catch-up" provision in this Plan,
provided that such date is no earlier than the earliest age at
which the Participant has the right to retire without actuarial
reduction to the retirement benefit amount under the Employer's
pension plan. Selection of such date as part of this "Catch-up"
provision does not impose an obligation to retire at the end of
the "Catch-up" contribution period chosen.
2.17 "Participant" means any individual who -performs services for the
Employer either as an Employee as defined in Section 2 (2.13)
and who elects to participate in this Plan, or who has unpaid
benefits due under the Plan, as well as any Separated Employee
or Beneficiary who has unpaid benefits due under the Plan.
2.18 "Participation Agreement" means an agreement filed by an 3
Employee to elect initial participation or modify current
participation in the Plan.
(5)
2.19 "Participation Account" means the book account to which there is
credited the Participant's Deferred Compensation, together with
any interest, dividends, gains, losses, or the like thereon.
2.20 "Plan Year" means the calendar year during which the Plan
becomes effective, and each succeeding calendar year during the
existence of this Plan.
2.21 "Termination of Employment" means in the case of an Employee,
separation from service within the meaning of IRC Section
402(e)(4)(A)(iii) or on account of the Participant's death or
retirement, or in the case of an independent contractor, the
expiration of the contract (or in the case of more than one
contract, all contracts) under which services are performed for
the Employer.
2.22 "Unforeseeable Emergency" means severe financial hardship to the
Participant or of a dependent of the Participant (as defined in
Internal Revenue Code Section 152(a)).
SECTION 3
Operation of the Plan
3.1 Participation. Any Employee may elect to become a Participant
in the Plan and to defer payment of part of his/her Compensation
not yet earned by executing a written Participation Agreement
and filing it with the Employer.
(6)
-j 3.2 Deferred Compensation means that portion of an Employee's
Compensation which said Employee has elected to defer in
accordance with the provisions of this Plan, subject to the
following limitations:
(a) The maximum amount that may be deferred under the Plan for
the taxable year of a Participant shall not exceed the
lesser of:
(1) $7,500, or
(2) 33 1/3 percent of the Participant's Includible
Compensation (typically 25 percent of the Participant's
Compensation).
(b) Provided, however, that for one or more of a Participant's
last three taxable years ending prior to a Participant's
Normal Retirement Date (as defined in Section 2 (2.16)),
the maximum amount that may be deferred under the Plan
shall be the lesser of:
(1) $15,000, or
(2) the combined sum of:
(i) the maximum deferral amount as calculated in
(a) above for the current taxable year; and
(7)
(ii) the maximum deferral amount permitted in
(a) above for any prior taxable year(s)
which began after December 31, 1978 and in
which the Participant was eligible to
participate in this Plan, less the amount
of Compensation actually deferred under
this Plan for any such prior taxable year
or years.
(iii) A Participant may only utilize Subsection
(b) above once, whether under this Plan or
any other Eligible Deferred Compensation
Plan.
(c) For any individuals who are Participants in more than one
Plan, the maximum amount of Compensation deferred for all
Plans during any taxable year shall not exceed $7,500 (as
modified by the adjustment provided under Subsection (b) of
this definition).
(8)
r
` (d) For any individuals who are Participants in a Code Section
403(b) Plan, the amounts excluded in any taxable year under
such Plans shall be treated as amounts deferred for
purposes of Subsections (a), (b), and (c) of these
definitions for any year of service and shall be treated as
amounts excluded under Code Section 403(b)(2)(A)(ii).
Further, for taxable years beginning on or after January 1,
1989, said $7,500 and $15,000 limits shall be reduced by
amounts deferred under any qualified cash or deferred
arrangement (Code Sections 401(k), Simplified Employer
Plans; 408(k)(6); or 501(c)(18) Plans).
3.3 Participation Agreement. The Administrator shall establish a
form of Participation Agreement which shall contain provisions
whereby the Participant specifies:
(a) that portion of his/her Compensation which is to be
deferred.
(b) his/her investment preference, subject to the approval of
the Employer.
(c) a designation of a Beneficiary(ies), including one or more
contingent Beneficiaries, to receive any benefits which may
be payable under this Plan on the death of the Participant.
(9)
(d) a provision whereby the Participant shall acknowledge that
his/her salary, wage or other compensation is as set forth
in any salary ordinance or otherwise without deductions for
amounts deferred under the provisions of this Plan.
(e) that the Participant together with his/her heirs,
successors, and assigns, holds harmless the Employer from
any liability hereunder for all acts performed in good
faith, including acts relating to the investment of
deferred amounts and/or the Employee's investment
preference hereunder.
(f) as prescribed by the Code, the Employer shall at all times
be the legal and beneficial owner of all Plan assets during
both the accumulation and payout periods until actually
distributed to the Participant or Beneficiary. The
obligation of the Employer to make payments pursuant to the
Plan is contractual only and no.Participant shall have a
preferred claim or lien on the Plan assets, but shall have
only the right to receive the benefits payable under the
Plan.
It is a condition of this Plan, that each Participant by
participating expressly agrees to look solely to the '
general assets of the Employer for the payment of any Plan
benefit to which the Participant is entitled.
(10)
3.4 Agreement Effective Date. Any person who becomes an Employee
after this Plan is first made available shall have the option to
effect an initial election to participate in the Plan. Such
election shall only be effective for pay periods commencing in
the month subsequent to the month in which an Employee makes the
election to participate in the Plan.
Any Employee who does not file an initial election, shall have
the right to elect participation during future enrollment
periods for the Plan. Such election shall only be effective for
pay periods commencing in the month subsequent to the month in
which the Employee makes the election to participate in the
Plan.
3.5 Amendment of Participation Agreement. The Participant may
change the amount of Compensation to be deferred, his/her
investment preference, or reverse his/her election to
participate by signing and filing with the Employer a written
amendment or revocation. Any such revocation or amendment shall
be effective prospectively only.
3.6 Regular Contributions. Regular Contributions are the amount of
compensation which may be deferred by a Participant other than
during the "Catch-up" period, Section 3 (3.7), subject to the
following limitations:
(a) Calendar Year Maximum. The maximum amount a Participant
may defer during a calendar year shall not exceed the
lesser of $7,500, or 25;G of the Participant's gross taxable
Compensation from the Employer.
(b) Pay Period Maximum. The maximum amount a Participant may
defer during a pay period, when combined with previous
deferrals during the calendar year, shall not exceed the
lesser of $7,500, or 25% of the Participant's year-to-date
gross taxable Compensation from the Employer.
(c) Pay Period Minimum. The minimum amount a Participant may
defer is $ 10.00 per pay period.
.4
(12)
3.7 "Catch-up" Contributions. A Participant may defer an additional
amount in excess of the regular contribution under this
"Catch-up" provision, for one or more of the last three complete
calendar years ending before attaining the Participant's Normal
Retirement Date as defined in Section 2 (2.16). The use of
"Catch-up" is subject to the restriction identified in Section 3
(3.2 (b)).
(a) The maximum amount a Participant may defer each calendar
"Catch-up" year shall not exceed:
$15,000 minus the regular contribution, or any Employer
provided Compensation eligible for deferral that was not
previously deferred beginning with 1979, or the date of
the first Plan year after 1979; or the Employee's first
year of hire if later.
(b) To use "Catch-up", a Participant must declare a retirement
age, which must be any age at or after which the
Participant qualifies for normal retirement eligibility,
but not later than age 70 1/2. This declaration does not
compel retirement.
(c) The "Catch-up" provision may not be used during any
calendar year that the Participant ceases to be an '
Employee.
(13)
J (d) The "Catch-up" provision may be used only once by a
Participant, whether under this Plan or any other Eligible
Deferred Compensation Plan.
(e) Participants may continue to make regular Contributions
after they are no longer eligible to use "Catch-up".
3.8 Employer Contributions. Nothing in this Plan prohibits the
Employer from making deposits to a Participant's Participation
Account as additional Compensation for services rendered. Such
Employer Contributions become part of the Participant's maximum
contribution limits.
SECTION 4
Investment Responsibilities
The Employer shall defer payment of Participant Compensation in the
amount specified in each Participation Agreement filed with the
Employer.
(14)
0
4.1 Investment of the Deferred Amount. The deferred amount shall be
held as if such amounts were invested in the Contract described
herein which provides for Fixed (savings -type) Contributions at
guaranteed rates of interest, Variable Contributions to a
"Bond/Debt Securities Fund Account", "Stock Fund Account",
"Money Market Fund Account", "Government Money Market Fund
Account", "Advisers Fund Account", "Aggressive Growth Fund
Account", "GNMA/Mortgage Securities Fund Account", "Index Fund
Account", "Socially Responsive Fund Account", "International
Opportunities Fund Account", "AHS/Twentieth Century Select Fund
Account", "AMS/Twentieth Century Ultra Fund Account",
"AHS/Twentieth Century Balanced Fund Account", "AKS/Fidelity
Advisor Growth Opportunities Fund Account", AHS/Fidelity Advisor
Income and Growth Opportunities Fund Account", AHS/Fidelity
Advisor Strategic Opportunities Fund Account", "AMS/Fidelity
Advisor Overseas Fund Account", or other accounts as they become
available.
4.2 Employer's Investment Rights. The Employer may, but is not
required to, invest amounts equal to the Deferred Compensation
credited to a Participation Account in accordance with his/her
investment requests. However, the Employer shall be under no
obligation to invest the deferred amount in the manner specified
and shall retain the right to approve or disapprove investment '
requests made by the Participant at the time of enrollment or at
the time of change in enrollment.
(15)
J 4.3 Amendment of Investment Preference. The Participant may amend
his/her statement of investment preference by filing with the
Employer a signed amendment or by other means such as telephone
transfers, etc. which are approved by the Administrator and in
good processable order. Such amendment(s) will, unless
specifically stated otherwise, apply only to future and/or past
amounts deferred under the Plan.
4.4 Investment Disclaimer. Any action by the Employer in investing
funds, or approving any such investment of funds, shall not be
considered to be either an endorsement or a guarantee of any
investment; nor shall it be considered to attest to the
financial soundness or the suitability of any investment for the
purpose of meeting future obligations as provided under the
distribution guidelines given below.
4.5 Statement of Account. The Employer will issue Statements of
Account periodically to reflect the actual contributions, unit
values net of expenses, earnings, gains, and losses posted to
the Participation Account.
(16)
J
SECTION 5
Distributions
Code Section 457 and the applicable regulations determine the
Participant's eligibility for distributions and payout options
available.
5.1 Eligibility for Distribution. With one exception
("Unforeseeable Emergency" as defined in Section 2 (2.22) and
explained in Section 5 (5.7)) the start of distribution must
await separation from service within the meaning of Code
Sections 1.457-2 (h) (2) & (3) of the Income Tax Regulations.
Such separation includes:
(a) termination of employment (before retirement) to join
another Employer or otherwise;
(b) retirement under the present Employer's retirement plan;
(c) death of the Participant; or
(d) the Participant attaining age 70 1/2 while still employed
with the Employer in which event distribution may take
place.
(17)
5.2 Deferral of Distribution. Once a Participant becomes eligible,
as defined above, the Employer shall notify its Plan
Administrator of all such Participants who separate service in a
timely manner. Once notified, the Administrator will advise all
Participants within 60 days of their option to defer the
withdrawal of monies from their account. The Participant then
has a period of up until April 1 following the calendar year in
which separation of service occurs, during which time the
Participant may decide to defer the beginning of part or all of
his/her distribution. Such deferral must be until a determined
and irrevocable future date, but not later than April 1 of the
calendar year following the attainment of age 70 1/2. The
applicable irrevocable deferral of distribution form must be
signed by April 1st of the calendar year following separation;
and filed with the Employer.
If the Participant does not sign an irrevocable deferral of
distribution form to defer receipt of payments before the expiry
of the April 1 date above, distributions of his/her account
value, as a decision by default, shall be made to the
Participant under Option 5 over a 10 year period. If the
account is valued at or less, a lump sum
payment will be made.
(18)
5.3 Latest Starting Date for Distribution (Deferred or Otherwise).
In any event, the latest date by which distribution must start
is April 1 following the calendar year in which the participant
attains age 70 1/2, unless the Participant is still working for
this Employer on that date. In such event, distribution must
start by April 1 of the calendar year following retirement.
5.4 Maximum Duration of Distribution & Minimum Amount (Each
Distribution). Distribution is allowed to last no longer than
the Participant's actual lifetime or the actual lifetime of the
spouse of the Participant. A non -spousal Beneficiary's maximum
payout period is 15 years. A guaranteed lifetime distribution
may be achieved through one of the life annuities described in
Section 5 (5.5).
Alternatively or in addition to the lifetime option described
above, the Participant's account value may be distributed over a
predetermined Fixed Period Annuity (Option 5) or under any other
available payout arrangement which satisfies IRC requirements
if available, (as described in Section 5 (5.5 A) below). Such
period must be no longer than the period equal to the
Participant's allowable life expectancy, as defined, on the date
the distribution starts. If the Participant outlives the fixed
period chosen, no further payments are made beyond the end of
that period.
(19)
Each distribution must also follow the Minimum Distribution
Requirements (MDR) of Sections 401 (a)(9) and 457 (d) and the
regulations thereunder as they may be amended from time to time.
There is a substantial penalty (Federal excise tax) for not
satisfying these requirements.
Each of the annuity distribution options are summarized below,
together with the other available distribution options.
5.5 Distribution Options Available to Participant (Starting Before
Death). The full amount credited to the Participation Account
(including earnings and net gain or loss), less any Federal or
State income tax or State premium tax, shall be distributed as
instructed by the Participant by exercising any one or
combination of the following options:
A. Annuity Options
Annuity Option 1 - Life Annuity - An annuity payable during the
lifetime of the Participant, regardless of how long the
Participant may live (but with no provision for any payment to a
Beneficiary) .
(20)
Annuity Option 2 - Life Annuity With Period Certain Guaranteed -
An annuity payable during the lifetime of the Participant, with
the guarantee that if at the Participant's death payments have
not been made for the guaranteed period as elected, payments
will continue to the Beneficiary for the remainder of the
guaranteed period.
The guaranteed period to be elected must be either ten (10)
years, or fifteen (15) years, if the Beneficiary is not a
spousal Beneficiary. For a spousal Beneficiary, the guaranteed
period to be elected may be either ten (10) years, fifteen (15)
years, or twenty (20) years, but may not exceed the allowable
life expectancy.
Annuity Option 3 - Refund Life Annuity - An annuity payable
during the lifetime of the Participant, with a provision for
payment to a Beneficiary if the sum of the annuity payments made
to the Participant at the time of the Participant's death are
less than the Participant's original account value used to
implement the annuity. If that sum is less, the difference will
be paid in one amount to the Beneficiary.
Annuity Option 4 - Joint & Survivor Annuity - An annuity payable
for a minimum of ten (10) years certain during the lifetime of 3
the Participant and then 100% of the benefit on death of the
Participant to the Joint Annuitant selected by the Participant
at the inception of the annuity. If a 50% or 2/3rd benefit is
payable to the beneficiary no period certain is applicable.
(21)
Annuity Option 5 - Payments For a Specified Period - An annuity
payable "in substantially non -increasing installments" during a
specified period chosen by the Participant from three (3) to
thirty (30) years, but not in excess of the Participant's
allowable life expectancy.
B. Lump Sum Or Partial Payment Option
A single payment for the full or partial account value, less any
Investment Contract charges (if applicable) and Federal or State
income taxes.
C. Systematic Withdrawal Option (SWO)
The Participant selects the amount of income he/she desires to
receive and the account remains as an active account with all
applicable features. The Participant selects the amount of
income desired subject to certain limitations.
i
(22)
5.6 Distribution Options in Event of Participants Death. In the
event of the Participant's death before full liquidation of the
Participant's Account the full account value or any remaining
benefits payable, less any required Federal or State income
taxes shall be distributed in accordance with the following
requirements:
(a) Where Distribution Has Started Prior To Death
If distribution begins prior to the death of the
Participant the balance of the Participant's Account or the
outstanding benefits payable shall be paid to the
Beneficiary in accordance with the terms of the payment
option selected by the Participant. Under IRS Regulations,
such payment schedule must effect distribution of the
remaining value or benefits at least as rapidly as under
the method of payment used before the Participant's death.
(23)
r (b) Where Distribution has Not Started Prior To Death
If distribution did not begin prior to the death of the
Participant, a spousal Beneficiary may irrevocably defer
distribution (until no later than April 1 following the
year in which the deceased Participant would have attained
age 70 1/2) by signing the applicable irrevocable deferral
of distribution form within 60 days following the calendar
year of the Participant's death. Such spousal Beneficiary
may exercise any one of Annuity Options 1, 2, 3, or 5 under
Section 5 (5.5 A) above within his/her allowable single
life expectancy, or exercise the Lump Sum or Partial
Payment Options under Section 5 (5.5 B) above.
A non -spousal Beneficiary may take distribution over a
period not exceeding 15 years; and such distribution must
begin not later than December 31st of the calendar year
after the date of the Participant's death.
If either Beneficiary above fails to make an election
within the designated time, payments will start by default
(at the expiry of the time available for making such
election) under Annuity Option 5 over a 10 year period. If
the account is valued at or less, a lump
sun payment will be made.
(24)
5.7 Emergency Distribution. Not withstanding any other provisions
of this Plan, a Participant may apply for a withdrawal of funds
from the Plan under certain emergency conditions. The Employer
will evaluate the request for conformity with its interpretation
of the applicable IRS Regulations.
The Participant must satisfy the Employer that all of the
following conditions are met before the Employer may authorize
any emergency withdrawal:
(a) Major unexpected and unreimbursable expenses exist that
were not foreseeable and are beyond the Participant's
control;
(b) The unforeseeable emergency event involves the Participant,
his/her spouse or any dependent who qualifies.
(c) The financial burden created by the emergency must be the
legal obligation of the Participant;
(d) All other financial sources, such as insurance payments and
attempts to obtain loans have been exhausted;
(e). All assets must be liquidated except where liquidation
would itself cause a severe financial hardship;
(f) The amount of the requested withdrawal is limited to the
amount necessary to meet the financial emergency only; and
(g) Great financial hardship will occur if the withdrawal is
not permitted.
(25)
s
Examples of hardship circumstances include major property loss
and catastrophic illness of the Participant's spouse or
dependents.
Vithdrawals are not authorized for expenses related to the death
or illness of a family member. Nor are withdrawals permitted
for budgetable expenses such as an automobile, college costs,
down payment on a home, or expenses relative to divorce
proceedings.
Any remaining benefits shall be paid upon retirement,
termination of employment, or death in accordance with Section
5.
The decision of the Employer concerning Emergency Distribution
shall be final.
SECTION 6
Beneficiary
6.1 Designation. Each Participant has the right, by written notice
filed with the Employer, to designate one or more primary and/or
contingent Beneficiaries to receive any benefits payable under ,
this Plan in the event of the Participant's death prior to the
complete distribution of benefits. The Participant accepts and
acknowledges that he has the burden for executing and filing,
with the Employer, a proper Beneficiary designation form.
(26)
The form for this purpose shall be provided by the
Administrator. It is not binding on the Employer until it is
signed, filed with the Employer by the Participant, and accepted
by the Employer.
If no estate executor or administrator is appointed and
qualified within one hundred twenty (120) days after the
Participant's death, the payment will be made first, to a
surviving spouse; second, to a surviving child or children; and
third, to a surviving parent or parents.
If no Beneficiary described above survives the Participant, the
Beneficiary shall be the estate.
SECTION 7
Non -Assignability
Neither the Participant nor the Participant's Beneficiary, nor any
other designee, shall have any right to commute, sell, assign, pledge,
hypothecate, transfer, or otherwise convey the right to receive any
payments hereunder, which payments and right thereto are expressly
declared to be non -assignable and non -transferable.
Except to the extent otherwise provided by law, no payments shall be
subject to attachment, garnishment or execution, or be transferable in
the event of bankruptcy or insolvency.
(27)
SECTION 8
Plan Transfers
Code Section 457 and the applicable regulations permit transfers of
Plan interests when the Participant changes Employers.
8.1 Transfers In. The full value of a Participant's Account may be
accepted from another Eligible Deferred Compensation Plan
maintained by the prior Employer and credited to the
Participant's Account under this Plan, if:
(a) The Participant has separated from service with the prior
Employer and become an Employee.
(b) The prior Employer's Plan provides that such transfer can
be made.
As it deems necessary, the new Employer may require such
documentation from the predecessor Plan to effect the transfer,
to confirm that such Plan is an Eligible Deferred Compensation
Plan within the meaning of Code Section 457 and to assure that
transfers are provided for under such Plan.
(28)
The new Employer may refuse to accept a transfer in the form of
assets other than cash, unless the new Employer agrees to hold
such other assets under the Plan.
Any amounts transferred that had been deferred during prior
calendar years will not be subject to current calendar year
deferral limitations.
8.2 Transfers Out. The full value of a Participant's Account may be
transferred to another Eligible Deferred Compensation Plan
maintained by another Employer, if:
(a) The Participant has separated from service with the prior
Employer and become an Employee of a new Employer;
(b) The new Employer's Plan provides that such transfer will be
accepted; and
(c) The Participant and the prior Employer have signed such
agreements as are necessary to assure that the prior
Employer's liability to pay benefits to the Participant
have been discharged and assumed by the new Employer.
(29)
' As it deems necessary, the prior Employer may require
documentation from the new Employer's Plan to effect the
transfer, to confirm that such Plan is an Eligible Deferred
Compensation Plan within the meaning of Code Section 457 and to
assure that transfers are provided for under such Plan. Plan
transfers shall be made only under circumstances as are
permitted under Code Section 457 and the applicable regulations.
SECTION 9
Administration and Recordkeeping
9.1 Administration by Employer. This Plan shall be administered by
the Employer, which shall prescribe all forms, and adopt rules
and regulations necessary to carry out the purposes of the Plan.
The Employer may employ investment counsel to provide advice
concerning categories of investment, investment guidelines and
investment policy, provided however, that the advice or
recommendations of any such investment counsel shall not be
binding on the Employer, which shall make the final
determination concerning investment categories, investment
guidelines and policies.
(30)
The Employer may contract with a financially responsible
independent contractor to administer and coordinate the Plan
under the direction of the Employer. Notwithstanding any other
provisions to the contrary, the Administrator (as, defined in
Section 2 (2.1)) or independent contractor agrees that it shall
be solely responsible to the Employer for any and all services
performed by a subcontractor, assignee, or designee under this
agreement.
9.2 Deferred Compensation Committee. The Deferred Compensation
Committee shall mean the persons appointed by the Employer,
designated by ordinance, statute, etc. to administer and govern
the operation of the Plan.
(a) Chair
The Committee Chair shall furnish to the Plan Administrator
names and specimen signatures. As members are replaced and
appointed, such changes shall be furnished to the Plan
Administrator in the same manner.
(b) Responsibilities
The Committee is authorized and directed by the Employer to
conduct all negotiations and to submit and execute all
documents, agreements, and amendments, subject to form and
legality and to perform related actions which may be
necessary for the completion and maintenance of such an
agreement with the Plan Administrator.
(31)
• (c) Delegation of Responsibilities
The Committee may appoint such agents, advisers, counsel
and delegates as it deems necessary and appropriate for the
administration and operation of this Plan, and delegate to
such appointees any of its discretionary and ministerial
powers and duties in accordance with Section 9 (9.2) and to
the extent no fiduciary duty under law has been breached.
(d) Authority
The Committee shall have all powers to perform duties
necessary to exercise its functions including, but not
limited to:
(1) Recommending rules and regulations for the
administration of the Plan;
(2) Determining Employees' eligibility, participation and
benefits under the Plan;
(3) Directing the Employer (or the Plan Administrator) to
disburse benefits; and
(4) Selecting and reviewing any investment option or
potential investment option.
e
(32)
9.3 Administrative Costs. The Employer shall determine, in a fair
and equitable manner the administrative costs associated with
the vithholding of Deferred Compensation amounts pursuant to
this Plan, or in implementing the Plan. The Employer may
withhold or collect, or have withheld or collected, such costs,
in a manner which the Employer deems equitable from the
Compensation deferred or its income earned pursuant to the
Plan. The Administrator will remit or direct the remission of
appropriate amounts so withheld or collected to the Employer.
SECTION 10
Amendments
10.1 Right to Amend, Modify and Terminate. The Employer may at any
time modify or terminate the Plan by notifying Participants of
such action. The Employer shall not have the right to reduce or
affect the value of any Participation Account or any rights
accrued under the Plan prior to modification or termination.
(33)
10.2 Conformation. The Employer shall amend and interpret the Plan
to the extent necessary to conform to the requirements of Code
Section 457 and any other applicable law, regulation or ruling,
including amendments that are retroactive. In the event the
Plan is deemed by the Internal Revenue Service to be
administered in a manner inconsistent with Code Section 457, the
Employer shall correct such inconsistency within the period
provided in Code Section 457(b).
10.3 Plan Termination. In the event of the termination of the Plan,
distribution of benefits shall be made to Participants and
Beneficiaries pursuant to the distribution guidelines in Section
5 or the Transfer Provisions of Section 8.
y
(34)
SECTION 11
Employer Asset
11.1 Ownership of Deferred Amounts. As prescribed by the Code, the
Employer shall at all times be the legal and beneficial owner of
all Plan assets during both the accumulation and payout periods
until actually distributed to the Participant or Beneficiary.
The obligation of the Employer to make payments pursuant to this
Plan is contractual only and no Participant or Beneficiary shall
have a preferred claim or lien on or to the assets of this
investment fund but shall have only the right to receive the
benefits payable under the Plan.
The existence of the Plan shall not be deemed to create a trust
or limit use by the Employer of the funds therein for general
purposes. Such Plan assets shall remain subject to the claims
of the Employer's general creditors.
It is a condition of the Plan, that each Participant by
participating expressly agrees to look solely to the general
assets of the Employer for the payment of any Plan benefit to
which the Participant is entitled. -
(35)
SECTION 12
Miscellaneous
12.1 Retirement System Integration. Benefits payable by, and
deductions for Employee contributions to, any retirement system
of the Employer shall be computed without reference to amounts
deferred pursuant to this Plan.
12.2 Employment. Neither the establishment of the Plan nor any
modification thereof, nor the establishment of any account, nor
the payment of any benefits, shall be construed as giving to any
Participant or other person any legal or equitable right against
the Employer except as herein provided; and, in no event, shall
the terms of employment of any Employee be modified or in any
way affected hereby.
12.3 Successors and Assigns. The Plan shall be binding upon and
shall inure to the benefit of the Employer and the Employer's
successors and assigns, all Participants and Beneficiaries and
their heirs and legal representatives.
(36)
12.4 Written Notice. Any notice or other communication required or
permitted under the Plan shall be in writing, and if directed to
the Employer shall be sent to the designated office of the
Employer, and, if directed to a Participant or to a Beneficiary,
shall be sent to such Participant or Beneficiary at his/her last
known address as it appears on the Employer's record.
12.5 Total Agreement. This Plan Document and the Participation
Agreement, and any subsequently adopted amendment(s) thereof,
shall constitute the total agreement or contract between the
Employer and the Participant regarding the Plan. No oral
statement regarding the Plan may be relied upon by the
Participant.
12.6 Controlling Law. This Plan is created and shall be construed,
administered and interpreted in accordance with Section 457 of
the Code and the regulations thereunder and under the" laws of
the State of domicile of the Employer as the same shall be at
the time any dispute or issue is raised. If any portion of this
Plan is held illegal, invalid or unenforceable, the legality,
validity and enforceability of the remainder shall be
unaffected.
(37)
v
SIGNATURE PAGE
IN WITNESS WHEREOF, the Employer has executed this Plan Document
this day of
19
City of Lodi
(Employer's Name)
by
(Please Print)
(Signature)
its
(Title)
Witness
(Please Print)
(Signature)
(Title)
(38)
b
ATTACHMENT A - DEFINITION OF ELIGIBILITY OF EMPLOYEE TO PARTICIPATE IN
PLAN.
[ ] Full Time Employee
[ ] Permanent Part Time Employee
[ ] Part Time Employee
[ ] Independent Contractor
[ ] Other (describe)