3-Basic Plan Document 0046648002.pdf

PRE-APPROVED GOVERNMENTAL DEFINED CONTRIBUTION PLAN

BASIC PLAN DOCUMENT

[DC-BPD #03]

© Copyright 2020 Pre-Approved Governmental DC Basic Plan Document (Cycle 3) #03 i

TABLE OF CONTENTS

PLAN DEFINITIONS

1.01 Account

1.02 Account Balance

1.03 Actuarial Factor

1.04 Adoption Agreement (“Agreement” or “AA”)

1.05 After-Tax Employee Contributions

1.06 Alternate Payee

1.07 Anniversary Years

1.08 Annual Additions

1.09 Annuity Contract

1.10 Annuity Starting Date

1.11 Beneficiary

1.12 Break in Service

1.13 Cash-Out Distribution

1.14 Catch-Up Contributions

1.15 Catch-Up Contribution Limit

1.16 Code

1.17 Code §415 Limitation

1.18 Collectively Bargained Employee

1.19 Compensation Limit

1.20 Computation Period

(a) Eligibility Computation Period

(b) Vesting Computation Period

1.21 Custodian

1.22 Defined Benefit Plan

1.23 Defined Contribution Plan

1.24 Designated Beneficiary

1.25 Differential Pay

1.26 Directed Account

1.27 Directed Trustee

1.28 Direct Rollover

1.29 Disabled

1.30 Discretionary Trustee

1.31 Distribution Calendar Year

1.32 Early Retirement Age

1.33 Effective Date

1.34 Elapsed Time

1.35 Elective Deferral Dollar Limit

1.36 Elective Deferrals

1.37 Eligible Employee

1.38 Eligible Retirement Plan

1.39 Eligible Rollover Distribution

1.40 Employee

1.41 Employer

1.42 Employer Contributions

1.43 Employer Pick-up Contributions

1.44 Employment Commencement Date

1.45 Entry Date

1.46 Equivalency Method

1.47 ERISA

1.48 Excess Amount

1.49 Excess Compensation

1.50 Excess Deferrals

1.51 Favorable IRS Letter

1.52 FICA Replacement Plan

1.53 General Trust Account

1.54 Governmental Plan

1.55 Grandfathered 401(k) Arrangement

1.56 Hardship

1.57 Hour of Service

(a) Performance of duties

(b) Nonperformance of duties

(c) Back pay award

Pre-Approved Governmental Defined Contribution Plan

Table of Contents ii

(d) Related Employers/Leased Employees

(e) Maternity/paternity/FMLA/military leave

1.58 Indian Tribal Government

1.59 Insurer

1.61 Integration Level

1.62 Leased Employee

1.63 Limitation Year

1.65 Matching Contributions

1.66 Maximum Disparity Rate

1.67 Normal Retirement Age

1.68 Participant

1.69 Participating Employer

1.70 Participating Employer Adoption Page

1.71 Part-Time Employee

1.72 Period of Severance

1.73 Plan

1.74 Plan Administrator

1.75 Plan Compensation

(a) Determination period

(b) Partial period of participation

1.76 Plan Year

1.77 Predecessor Employer

1.78 Pre-Tax Deferrals

1.79 Provider

1.80 Qualified Domestic Relations Order (QDRO)

1.82 Reemployment Commencement Date

1.83 Related Employer

1.84 Required Beginning Date

1.85 Rollover Contribution

1.86 Roth Deferrals

1.87 Salary Deferral Election

1.88 Salary Deferrals

1.89 Seasonal Employee

1.90 Short Plan Year

1.91 Spouse

1.92 Taxable Wage Base

1.93 Temporary Employee

1.94 Total Compensation

(a) Total Compensation definitions

(b) Post-severance compensation

(c) Continuation payments for disabled Participants

(d) Deemed §125 compensation

(e) Differential Pay

1.95 Trust

1.96 Trustee

1.97 Valuation Date

1.98 Year of Service

SECTION 2

ELIGIBILITY AND PARTICIPATION

2.01 Eligibility

2.02 Eligible Employees

(a) Only Employees may participate in the Plan

(b) Excluded Employees

(c) Employees of Related Employers

(d) Ineligible Employee becomes Eligible Employee

(e) Eligible Employee becomes ineligible Employee

(f) Improper exclusion of eligible Participant

2.03 Minimum Age and Service Conditions

(a) Application of age and service conditions

(b) Entry Dates

2.04 Participation on Effective Date of Plan

2.05 Rehired Employees

iii

2.06 Service with Predecessor Employers

2.07 Break in Service Rules

2.08 Waiver of Participation

SECTION 3

PLAN CONTRIBUTIONS

3.01 Types of Contributions

3.02 Employer Contribution Formulas

(a) Contribution formulas (Profit Sharing Plan)

(b) Employer Contribution formulas (Money Purchase Plan)

(c) Contribution formulas (Grandfathered 401(k) Plan)

3.03 Employer Pick-Up Contributions

3.04 After-Tax Employee Contributions

3.05 Rollover Contributions

3.06 Deductible Employee Contributions

3.07 Allocation Conditions

(a) Special rule for year of Plan termination

(b) Service with Predecessor Employers

3.08 Contribution of Property

SECTION 4

SPECIAL RULES AFFECTING GOVERNMENTAL PLANS AND INDIAN TRIBAL GOVERNMENT PLANS

4.01 Governmental Plan

(a) Governmental Plan exemptions

(b) Adoption Agreement elections

4.02 Plan of Indian Tribal Government Treated as Governmental Plan

4.03 FICA Replacement Plan

SECTION 5

LIMITS ON CONTRIBUTIONS

5.01 Limits on Employer Contributions

(a) Limitation on total Employer Contributions

(b) Limitation on Salary Deferrals

5.02 Code §415 Limitation

(a) No other plan participation

(b) Participation in another plan

(c) Definitions

(d) Restorative payments

(e) Corrective provisions

(f) Change of Limitation Year

5.03 Elective Deferral Dollar Limit

(a) Excess Deferrals

(b) Correction of Excess Deferrals

SECTION 6

PARTICIPANT VESTING AND FORFEITURES

6.01 Vesting of Contributions

6.02 Vesting Schedules

6.03 Special vesting rules

(a) Normal Retirement Age

(b) 100% vesting upon death, disability, or Early Retirement Age

(c) Vesting upon merger, consolidation or transfer

(d) Vesting schedules applicable to prior contributions

(e) Different Vesting Schedules for Different Sources

6.04 Year of Service

(a) Hours of Service

(b) Elapsed Time method

6.05 Vesting Computation Period

6.06 Excluded service

(a) Service before the Effective Date of the Plan

(b) Service before a specified age

6.07 Service with Predecessor Employers

6.08 Break in Service Rules

6.09 Special Vesting Rule - In-Service Distribution When Account Balance is Less than 100% Vested

6.10 Forfeiture of Benefits

iv

(a) Cash-Out Distribution

(b) Five-Year Forfeiture Break in Service

(c) Missing Participant or Beneficiary

(d) Excess Deferrals

6.11 Allocation of Forfeitures

(a) Reallocation as additional contributions under Profit Sharing Plan Adoption Agreement

(b) Reallocation as additional Employer Contributions under Money Purchase Plan Adoption Agreement

(c) Reduction of contributions

(d) Payment of Plan expenses

(e) Forfeiture rules for other contribution types

SECTION 7

PLAN DISTRIBUTIONS

7.01 Available Forms of Distribution

7.02 Amount Eligible for Distribution

7.03 Participant Consent

(a) Involuntary Cash-Out threshold

(b) Participant notice

(c) Special rules

7.04 Direct Rollovers

(a) Definitions

(b) Direct Rollover notice

(c) Direct Rollover by non-Spouse beneficiary

(d) Direct Rollover of non-taxable amounts

(e) Rollovers to Roth IRA

7.05 Automatic Rollover

(a) Automatic Rollover requirements

(b) Involuntary Cash-Out Distribution

(c) Treatment of Rollover Contributions

7.06 Distribution Upon Termination of Employment

(a) Account Balance not exceeding Cash-Out threshold

(b) Account Balance exceeding Cash-Out threshold

7.07 Distribution Upon Death

(a) Death after commencement of benefits

(b) Death before commencement of benefits

(c) Determining a Participant’s Beneficiary

7.08 Distribution to Disabled Employees

7.09 Qualified Distributions for Retired Public Safety Officers

(a) Qualified health insurance premiums

(b) Eligible retired public safety officer

7.10 In-Service Distributions

(a) After-Tax Employee Contributions and Rollover Contributions

(b) Employer Contributions and Matching Contributions

(c) Salary Deferrals under Grandfathered 401(k) Arrangement

(d) Penalty-free withdrawals for individuals called to active duty

(e) Hardship distribution

7.11 Sources of Distribution

(a) Exception for Hardship withdrawals

(b) Roth Deferrals

(c) In-kind distributions

7.12 Correction of Qualification Defects

SECTION 8

REQUIRED MINIMUM DISTRIBUTIONS

8.01 Required Minimum Distributions

8.02 Death of Participant before required distributions begin

(a) Surviving Spouse is sole Designated Beneficiary

(b) Surviving Spouse is not the sole Designated Beneficiary

(c) No Designated Beneficiary

(d) Death of surviving Spouse

8.03 Required Minimum Distributions during Participant’s lifetime

(a) Amount of Required Minimum Distribution for each Distribution Calendar Year

(b) Lifetime Required Minimum Distributions continue through year of Participant’s death

8.04 Required Minimum Distributions After Participant’s Death v

(a) Death on or after date required distributions begin

(b) Death before date required distributions begin

8.05 Definitions

(a) Designated Beneficiary

(b) Distribution Calendar Year

(c) Life expectancy

(d) Account Balance

(e) Required Beginning Date

8.06 Special Rules

(a) Election to apply 5-year rule to required distributions after death

(b) Election to allow Participants or Beneficiaries to elect 5-year rule

(c) Forms of Distribution

(d) Treatment of trust beneficiaries as Designated Beneficiaries

(e) Special rules applicable to trust beneficiaries

8.07 Transitional Rule

(a) The following provisions modify the required minimum distribution rules under this

(b) Effective/Applicability Dates

(c) Account Balance for Determining Minimum Distributions

(d) Rules Applicable to Qualifying Longevity Annuity Contracts

SECTION 9

SPOUSAL CONSENT RULES

9.01 Application of Joint and Survivor Annuity Rules

9.02 Spousal consent

9.03 One-year marriage rule

SECTION 10

PLAN ACCOUNTING AND INVESTMENTS

10.01 Participant Accounts

10.02 Valuation of Accounts

(a) Periodic valuation

(b) Daily valuation

(c) Interim valuations

10.03 Adjustments to Participant Accounts

(a) Distributions and forfeitures from a Participant’s Account

(b) Life insurance premiums and dividends

(c) Contributions and forfeitures allocated to a Participant’s Account

(d) Net income or loss

10.04 Share or unit accounting

10.05 Suspense accounts

10.06 Investments under the Plan

(a) Investment options

(b) Investment of tax deductible Employee contributions in life insurance and collectibles

10.07 Participant-directed investments

(a) Limits on participant investment direction

(b) Failure to direct investment

10.08 Investment in Life Insurance

(a) Incidental Life Insurance Rules

(b) Ownership of Life Insurance Policies

(c) Evidence of Insurability

(d) Distribution of Insurance Policies

(e) Discontinuance of Insurance Policies

(f) Protection of Insurer

(g) No Responsibility for Act of Insurer

SECTION 11

PLAN ADMINISTRATION AND OPERATION

11.01 Plan Administrator

11.02 Designation of Alternative Plan Administrator

(a) Acceptance of responsibility by designated Plan Administrator

(b) Multiple alternative Plan Administrators

(c) Resignation or removal of designated Plan Administrator

(d) Employer responsibilities

(e) Indemnification of Plan Administrator vi

11.03 Duties, Powers and Responsibilities of the Plan Administrator

(a) Delegation of duties, powers and responsibilities

(b) Specific Plan Administrator responsibilities

11.04 Plan Administration Expenses

(a) Reasonable Plan administration expenses

(b) Plan expense allocation

(c) Expenses related to administration of former Employee or surviving Spouse

11.05 Qualified Domestic Relations Orders (QDROs)

(a) In general

(b) Definitions related to Qualified Domestic Relations Orders (QDROs)

(c) Recognition as a QDRO

(d) Contents of QDRO

(e) Impermissible QDRO provisions

(f) Immediate distribution to Alternate Payee

(g) Fee for QDRO determination

(h) QDRO procedure

11.06 Claims Procedure

SECTION 12

TRUST AND OTHER PLAN FUNDING

12.01 Establishment of Trust or Other Funding Mechanism

12.02 Conflicting Trust Provisions

12.03 More than One Trustee

12.04 Annual Valuation

12.05 Appointment of Custodian

12.06 Custodial Accounts, Annuity Contracts and Insurance Contracts

SECTION 13

PARTICIPANT LOANS

13.01 Availability of Participant Loans

13.02 Must be Available in Reasonably Equivalent Manner

13.03 Loan Limitations

13.04 Limit on Amount and Number of Loans

(a) Loan renegotiation

(b) Participant must be creditworthy

13.05 Reasonable Rate of Interest

13.06 Adequate Security

13.07 Periodic Repayment

(a) Leave of absence

(b) Military leave

13.08 Designation of Accounts

13.09 Procedures for Loan Default

13.10 Termination of Employment

(a) Offset of outstanding loan

(b) Direct Rollover

13.11 Mergers, Transfers or Direct Rollovers from another Plan/Change in Loan Record Keeper

13.12 Amendment of Plan to Eliminate Participant Loans

SECTION 14

PLAN AMENDMENTS, TERMINATION, MERGERS AND TRANSFERS

14.01 Plan Amendments

(a) Amendment by the Provider

(b) Amendment by the Employer

(c) Method of amendment

(d) Effective date of Plan Amendments

14.02 Plan Termination

(a) Full and immediate vesting

(b) Distribution upon Plan termination

(c) Missing Participants

(d) Partial Termination

14.03 Merger or Consolidation

14.04 Transfer of Assets

(a) Trustee’s right to refuse transfer

(b) Transfer of Plan to unrelated Employer vii

SECTION 15

MISCELLANEOUS

15.01 Exclusive Benefit

15.02 Return of Employer Contributions

(a) Mistake of fact

(b) Failure to initially qualify

15.03 Participants’ Rights

15.04 Military Service

(a) Death benefits under qualified military service

(b) Benefit accruals

(c) Plan distributions

(d) Make-Up Contributions

15.05 Annuity Contract

15.06 Use of IRS Compliance Programs

15.07 Governing Law

15.08 Waiver of Notice

15.09 Use of Electronic Media

15.10 Severability of Provisions

15.11 Binding Effect

SECTION 16

PARTICIPATING EMPLOYERS

16.01 Participation by Participating Employers

16.02 Participating Employer Adoption Page

(a) Application of Plan provisions

(b) Plan amendments

(c) Trustee designation

16.03 Compensation of Related Employers

16.04 Allocation of Contributions and Forfeitures

16.05 Discontinuance of Participation by a Participating Employer

16.06 Operational Rules for Related Employer Groups

16.07 Multiple Employer Plans

(a) Application of qualification rules to Multiple Employer Plans

(b) Definitions that apply to Multiple Employer Plans

(c) Special rules for Multiple Employer Plans

APPENDIX A

ACTUARIAL FACTORS

Actuarial Factor Table

APPENDIX B

INTERIM AMENDMENT #1

FINAL REGULATIONS RELATING TO HARDSHIP DISTRIBUTIONS

B-1.01 Change in Hardship Distribution Requirements

B-2.01 Acceptance of Rollover Contributions

B-3.01 Relief for Victims of Certain Qualified Natural Disasters

B-3.02 Qualified Natural Disasters

B-3.03 General Rules

APPENDIX C

INTERIM AMENDMENT #2

CARES/SECURE ACTS

C-1.01 Application

C-1.02 Prior Amendments

C-2.01 Applicable Laws

C-2.02 Application to Cycle 3 Defined Contribution Plans

C-3.01 Coronavirus Aid, Relief, and Economic Security Act

C-3.02 Coronavirus-Related Distributions and Loan from the Plan

C-3.03 Required Minimum Distributions for 2020

C-4.01 Consolidated Appropriations Act, 2021

C-4.02 Special Disaster-Related Rules

C-4.03 Temporary Rule Preventing Partial Plan Termination

C-4.04 Coronavirus-Related Distributions in Money Purchase Pension Plans and Money Purchase Pension Assets

C-5.01 SECURE Act, Miners Act and Disaster Tax Relief Act of 2019 viii

C-5.02 Modification of Required Minimum Distribution Rules

C-5.03 Prohibition from Making Loans Through Credit Cards

C-5.04 Special Disaster-Related Distributions and Loans

C-5.05 Elimination of Notice Requirement for Nonelective Safe Harbor 401(k) Plans

C-5.06 Delay in Adopting Provisions for Nonelective Safe Harbor 401(k) Plan under SECURE Acts §§103(b) and (c)

C-5.07 Portability of Lifetime Income Options

C-5.08 Qualified Birth or Adoption Distributions (“QBADs”)

C-5.09 Increase of Cap for QACA Safe Harbor 401(k) Plan

C-5.10 Including Difficulty of Care Payments in Total Compensation

C-5.11 In-Service Distributions for Money Purchase Pension Plans and Transferred Pension Assets

C-5.12 Participation of Long-Term Part-Time Employees in 401(k) Plan

C-5.13 Plan Adopted by Filing Due Date

Section 1 – Plan Definitions

PLAN DEFINITIONS

This Section contains definitions for common terms that are used throughout the Plan. All capitalized terms under the Plan are defined in this Section or in the relevant section of the Plan document where such term is used.

1.01 Account. The separate Account maintained for each Participant under the Plan by the Plan Administrator, Plan service provider, Custodian or insurance company. A Participant may have any (or all) of the following separate Accounts, to the extent authorized under the Plan:

• Employer Contribution Account

• Matching Contribution Account

• After-Tax Employee Contribution Account

• Employer Pick-Up Contribution Account

• Rollover Contribution Account

• Transfer Account

In addition, if this Plan qualifies as a Grandfathered 401(k) Arrangement (as defined in Section 1.55), a Participant also may have any (or all) of the following separate Accounts:

• Pre-Tax Salary Deferral Account

• Roth Deferral Account

• Roth Rollover Contribution Account

The Plan Administrator may establish other Accounts, as it deems necessary, for the proper administration of the Plan.

1.02 Account Balance. Account Balance shall mean a Participant's balances in all of the Accounts maintained by the Plan on his or her behalf.

1.03 Actuarial Factor. A Participant’s Actuarial Factor is used for purposes of determining the Participant’s allocation under the age-based formula under AA §6-3(f) of the Profit Sharing Plan Adoption Agreement or under the age-based contribution formula under AA §6-2(e) of the Money Purchase Plan Adoption Agreement. See Section 3.02(a)(1)(i)(E) or 3.02(b)(4).

1.04 Adoption Agreement (“Agreement” or “AA”). The Adoption Agreement contains the elective provisions that an Employer may complete to supplement or modify the provisions under the Plan. Each adopting Employer must complete and execute the

Adoption Agreement. If the Plan covers Employees of an Employer other than the Employer that executes the Employer

Signature Page of the Adoption Agreement, such additional Employer(s) must execute a Participating Employer Adoption Page under the Adoption Agreement. (See Section 16 for rules applicable to adoption by Participating Employers.) An Employer may adopt more than one Adoption Agreement associated with this Plan document. Each executed Agreement is treated as a separate Plan. The Employer may adopt a Profit Sharing Plan Adoption Agreement or a Money Purchase Plan Adoption

Agreement. The Employer also may elect under the Profit Sharing Plan Adoption Agreement to provide for a Grandfathered

401(k) Arrangement under the Plan. Any reference to the Profit Sharing Plan Adoption Agreement includes the Grandfathered

401(k) Plan Adoption Agreement, unless specifically provided otherwise.

1.05 After-Tax Employee Contributions. Employee Contributions that may be made to the Plan by a Participant that are included in the Participant’s gross income in the year such amounts are contributed to the Plan and are maintained under a separate

After-Tax Employee Contribution Account to which earnings and losses are allocated. See Section 3.04. For this purpose, Roth

Deferrals are not considered as After-Tax Employee Contributions.

1.06 Alternate Payee. A person designated to receive all or a portion of the Participant’s benefit pursuant to a QDRO. See Section

1.80.

1.07 Anniversary Years. An alternative period for measuring Eligibility Computation Periods (under Section 2.03(a)(3)) and

Vesting Computation Periods (under Section 6.05). An Anniversary Year is any 12-month period which commences with the

Employee’s Employment Commencement Date, or which commences with the anniversary of the Employee’s Employment

Commencement Date.

1.08 Annual Additions. The amounts taken into account under a Defined Contribution Plan for purposes of applying the limitation on allocations under Code §415. See Section 5.02(c)(1) for the definition of Annual Additions.

1.09 Annuity Contract. A nontransferable group annuity certificate or individual contract as defined in Code §401(g) that is issued by an insurance company qualified to issue annuities in a State and that includes payment in the form of an annuity and that meets the following requirements: (a) An Annuity Contract may only be offered by an Insurance Company; (b) The Annuity

Contract may be owned by the Participant, and a group Annuity Contract may be held by the Trustee or Employer (if a qualified trust substitute under Code §401(f)); and (c) An Annuity Contract may be fixed, variable, or a combination of fixed and variable.

A life insurance contract, an endowment contract, a health or accident insurance contract, or a property, casualty, or liability insurance contract do not constitute an Annuity Contract. However, this does not apply for contracts issued before September

24, 2007.

1.10 Annuity Starting Date. The date an Employee commences distribution from the Plan. If a Participant commences distribution with respect to a portion of his/her Account Balance, a separate Annuity Starting Date applies to any subsequent distribution. If distribution is made in the form of an annuity, the Annuity Starting Date is the first day of the first period for which annuity payments are made.

1.11 Beneficiary. A person designated by the Participant (or by the terms of the Plan) to receive a benefit under the Plan upon the death of the Participant. See Section 7.07(c) for the applicable rules for determining a Participant’s Beneficiaries under the

Plan.

1.12 Break in Service. The Computation Period (as defined in Section 2.03(a)(3) for purposes of eligibility and Section 6.05 for purposes of vesting) during which an Employee does not complete more than five hundred (500) Hours of Service with the

Employer. However, if the Employer elects under AA §4-3(a) or AA §8-5(a) to require less than 1,000 Hours of Service to earn a Year of Service for eligibility or vesting purposes, a Break in Service will occur for any Computation Period during which the

Employee does not complete more than one-half (1/2) of the Hours of Service required to earn a Year of Service for eligibility or vesting purposes, as applicable. However, if the Elapsed Time method applies under AA §4-3(c) (for purposes of eligibility) or AA §8-5(c) (for purposes of vesting), an Employee will incur a Break in Service if the Employee incurs at least a one-year Period of Severance (as defined under Section 1.72). (See Section 2.07 for a discussion of the eligibility Break in Service rules and Section 6.08 for a discussion of the vesting Break in Service rules.)

1.13 Cash-Out Distribution. A total distribution made to a terminated Participant in accordance with Section 6.10(a).

1.14 Catch-Up Contributions. Salary Deferrals that may be made under a Grandfathered 401(k) Arrangement that are in excess of an otherwise applicable Plan limit and that are made by a Participant who is age 50 or over by the end of his/her taxable year.

See Section 3.02(c)(2)(iv).

1.15 Catch-Up Contribution Limit. The annual limit applicable to Catch-Up Contributions as set forth in Section

3.02(c)(2)(iv)(A).

1.16 Code. The Internal Revenue Code of 1986, as amended.

1.17 Code §415 Limitation. The limit on the amount of Annual Additions a Participant may receive under the Plan during a

Limitation Year. See Section 5.02.

1.18 Collectively Bargained Employee. An Employee who is included in a unit of Employees covered by a collective bargaining agreement between the Employer and Employee representatives and whose retirement benefits are subject to good faith bargaining. Such Employees may be excluded from the Plan if designated under AA §3-1(b). See Section 2.02(b)(1) for additional requirements related to the exclusion of Collectively Bargained Employees.

1.19 Compensation Limit. The maximum amount of compensation that can be taken into account for any Plan Year for purposes of determining a Participant’s Plan Compensation. The Compensation Limit is $200,000, as adjusted for cost-of-living, increased in accordance with Code §401(a)(17)(B). For 2019, the Compensation Limit is $280,000. In determining the Compensation

Limit for any applicable period (the "determination period"), the cost-of-living adjustment in effect for a calendar year applies to any determination period that begins with or within such calendar year.

If a determination period consists of fewer than 12 months, the Compensation Limit for such period is an amount equal to the otherwise applicable Compensation Limit multiplied by a fraction, the numerator of which is the number of months in the short determination period, and the denominator of which is 12. A determination period will not be considered to be less than 12 months merely because compensation is taken into account only for the period the Employee is a Participant. If Salary

Deferrals, Matching Contributions, or After-Tax Employee Contributions are separately determined on the basis of specified periods within the determination period (e.g., on the basis of payroll periods), no proration of the Compensation Limit is required with respect to such contributions.

If compensation for any prior determination period is taken into account in determining a Participant’s allocations for the current Plan Year, the compensation for such prior determination period is subject to the applicable Compensation Limit in effect for that prior period.

In determining the amount of a Participant’s Salary Deferrals under a Grandfathered 401(k) Arrangement, a Participant may defer with respect to Plan Compensation that exceeds the Compensation Limit, provided the total deferrals made by the

Participant satisfy the Elective Deferral Dollar Limit and any other limitations under the Plan.

1.20 Computation Period. The 12-consecutive month period used for measuring whether an Employee completes a Year of Service for eligibility or vesting purposes.

(a) Eligibility Computation Period. The 12-consecutive month period used for measuring Years of Service for eligibility purposes. See Section 2.03(a)(3).

(b) Vesting Computation Period. The 12-consecutive month period used for measuring Years of Service for vesting purposes. See Section 6.05.

1.21 Custodian. An organization that has custody of all or any portion of the Plan assets in a custodial account as described in Code

§401(f). See Section 12.05.

1.22 Defined Benefit Plan. A plan under which a Participant’s benefit is based solely on the Plan’s benefit formula without the establishment of separate Accounts for Participants.

1.23 Defined Contribution Plan. A plan that provides for individual Accounts for each Participant to which all contributions, forfeitures, income, expenses, gains and losses under the Plan are credited or deducted. A Participant’s benefit under a Defined

Contribution Plan is based solely on the fair market value of his/her vested Account Balance.

1.24 Designated Beneficiary. A Beneficiary who is designated by the Participant (or by the terms of the Plan) and whose life expectancy is taken into account in determining minimum distributions under Code §401(a)(9) and Treas. Reg. §1.401(a)(9)-4.

See Section 8.05(a).

1.25 Differential Pay. Certain payments made by the Employer to an individual while the individual is performing service in the

Uniformed Services. See Section 1.94(e).

1.26 Directed Account. The Plan assets under a Trust which are held for the benefit of a specific Participant. See Section

10.03(d)(2).

1.27 Directed Trustee. A Trustee is a Directed Trustee to the extent that the Trustee’s investment powers are subject to the direction of another person.

1.28 Direct Rollover. A rollover, at the Participant’s direction, of all or a portion of the Participant’s vested Account Balance directly to an Eligible Retirement Plan. See Section 7.04.

1.29 Disabled. An individual is considered Disabled for purposes of applying the provisions of this Plan if the individual meets the definition of Disabled elected by the Employer under AA §2.8.

1.30 Discretionary Trustee. A Trustee is a Discretionary Trustee to the extent the Trustee has exclusive authority and discretion to invest, manage or control the Plan assets without direction from any other person.

1.31 Distribution Calendar Year. A calendar year for which a minimum distribution is required. See Section 8.05(b).

1.32 Early Retirement Age. The age and/or Years of Service set forth in AA §7-2. Early Retirement Age may be used to determine distribution rights and/or vesting rights. If a Participant separates from service before satisfying the age requirement for early retirement, but has satisfied the service requirement, the Participant will be entitled to elect an early retirement benefit upon satisfaction of such age requirement. The Plan is not required to have an Early Retirement Age.

1.33 Effective Date. The date this Plan, including any restatement or amendment of this Plan, is effective. The Effective Date of the

Plan is designated on the Employer Signature Page under the Adoption Agreement.

1.34 Elapsed Time. A special method for crediting service for eligibility or vesting. See Section 2.03(a)(6) for more information on the Elapsed Time method of crediting service for eligibility purposes and Section 6.04(b) for more information on the Elapsed

Time method of crediting service for vesting purposes. Also see Section 3.07 for the ability to use the Elapsed Time method for applying allocation conditions under the Plan.

1.35 Elective Deferral Dollar Limit. The maximum amount of Elective Deferrals a Participant may make for any calendar year.

See Section 5.03.

1.36 Elective Deferrals. A Participant's Elective Deferrals is the sum of all Salary Deferrals (as defined in Section 1.88) and other contributions made pursuant to a Salary Deferral Election under a SARSEP described in Code §408(k)(6), a SIMPLE IRA plan described in Code §408(p), a plan described under Code §501(c)(18), and a custodial account or other arrangement described in

Code §403(b). Elective Deferrals shall not include any amounts properly distributed as an Excess Amount under Code §415.

1.37 Eligible Employee. An Employee who is not excluded from participation under Section 2.02 of the Plan or AA §3-1.

1.38 Eligible Retirement Plan. A qualified retirement plan or IRA that may receive a rollover contribution. See Section 7.04(a)(2).

1.39 Eligible Rollover Distribution. An amount distributed from the Plan that is eligible for rollover to an Eligible Retirement

Plan. See Section 7.04(a)(1).

1.40 Employee. An Employee is any individual employed by the Employer (including any Related Employers). An independent contractor is not an Employee. An Employee is not eligible to participate under the Plan if the individual is not an Eligible

Employee under Section 2.02. A Leased Employee is also treated as an Employee of the recipient organization, as provided in

Section 2.02(b)(3).

1.41 Employer. Except as otherwise provided, Employer means the Employer that adopts this Plan and any Related Employer. The

Employer must be qualified to maintain a Governmental Plan under Code §414(d). (See Section 2.02(c) for rules regarding coverage of Employees of Related Employers. Also see Section 16 for rules that apply to Employers that execute a

Participating Employer Adoption Page.)

1.42 Employer Contributions. Contributions the Employer makes pursuant to AA §6. See Section 3.02.

1.43 Employer Pick-up Contributions. Contributions made by the Employee and picked up by the Employer in accordance with

Code §414(h)(2). See Section 3.03.

1.44 Employment Commencement Date. The date the Employee first performs an Hour of Service for the Employer.

1.45 Entry Date. The date on which an Employee becomes a Participant upon satisfying the Plan’s minimum age and service conditions. See Section 2.03(b).

1.46 Equivalency Method. An alternative method for crediting Hours of Service for purposes of eligibility and vesting. See Section

2.03(a)(5) for eligibility provisions and Section 6.04(a)(2) for vesting provisions.

1.47 ERISA. The Employee Retirement Income Security Act of 1974, as amended.

1.48 Excess Amount. Amounts which exceed the Code §415 Limitation. See Section 5.02(c)(4).

1.49 Excess Compensation. The amount of Plan Compensation that exceeds the Integration Level for purposes of applying the permitted disparity allocation formula. See Section 3.02(a)(1)(i)(B) (Profit Sharing Plan) and Section 3.02(b)(2) (Money

Purchase Plan).

1.50 Excess Deferrals. Elective Deferrals that exceed the Elective Deferral Dollar Limit (as defined in Section 5.03). (See Section

5.03(b) for rules regarding the correction of Excess Deferrals.)

1.51 Favorable IRS Letter. An opinion letter issued by the IRS pursuant to Rev. Proc. 2017-41 (or its successor) to a Provider as to the qualified status of a Pre-Approved Plan.

1.52 FICA Replacement Plan. This Plan may qualify as a FICA Replacement Plan under Code §3121(b)(7)(F) if the requirements under Section 4.03 are satisfied.

1.53 General Trust Account. The Plan assets under a Trust which are held for the benefit of all Plan Participants as a pooled investment. See Section 10.03(d)(1).

1.54 Governmental Plan. A plan established and maintained for its Employees by any State or political subdivision of a State, any

State agency or instrumentality, or an Indian Tribal Government (provided the requirements under Section 4.02 of the Plan are satisfied), as provided under Code §414(d).

1.55 Grandfathered 401(k) Arrangement. An arrangement under Code §401(k) maintained by a governmental employer that was in existence on May 6, 1986. If a governmental entity adopted a 401(k) plan before May 6, 1986, then all 401(k) plans adopted by the governmental entity are treated as adopted before such date, including a 401(k) plan that is actually adopted after such date. A Grandfathered 401(k) Arrangement also may be adopted by an Indian Tribal Government, as defined in Section 1.58.

The Employer may elect to provide a Grandfathered 401(k) Arrangement under AA §2-3 of the Profit Sharing Plan Adoption

Agreement. Any such election under AA §2-3 will be null and void if the Employer does not satisfy the requirements for maintaining a Grandfathered 401(k) Arrangement. If the Employer elects a Grandfathered 401(k) Arrangement under AA §2-3, the Employer may authorize Employees to make Salary Deferrals under the Plan in addition to Matching Contributions, Employer Contributions and After-Tax Employee Contributions, to the extent provided under AA §6 - §6B of the Adoption

Agreement.

1.56 Hardship. A heavy and immediate financial need which meets the requirements of Section 7.10(e).

1.57 Hour of Service. Each Employee of the Employer will receive credit for each Hour of Service he/she works for purposes of applying the eligibility and vesting rules under the Plan. An Employee will not receive credit for the same Hour of Service under more than one category listed below.

(a) Performance of duties. Hours of Service include each hour for which an Employee is paid, or entitled to payment, for the performance of duties for the Employer. These hours will be credited to the Employee for the computation period in which the duties are performed. In the case of Hours of Service to be credited to an Employee in connection with a period of no more than 31 days which extends beyond one computation period, all such Hours of Service may be credited to the first computation period or the second computation period. Hours of Service under this subsection (a) must be credited consistently for all Employees within the same job classifications.

(b) Nonperformance of duties. Hours of Service include 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 will be credited under this paragraph for any single continuous period (whether or not such period occurs in a single Computation Period). Hours under this paragraph will be calculated and credited pursuant to §2530.200b-2 of the Department of Labor Regulations which is incorporated herein by this reference.

(c) Back pay award. Hours of Service include each hour for which back pay, irrespective of mitigation of damages, is either awarded or agreed to by the Employer. The same Hours of Service will not be credited both under subsection (a) or subsection (b) above, as the case may be, and under this subsection (c). These hours will be credited to the Employee for the Computation Period(s) to which the award or agreement pertains rather than the Computation Period(s) in which the award, agreement or payment is made.

(d) Related Employers/Leased Employees. Hours of Service will be credited for employment with any Related Employer.

Hours of Service also include hours credited as a Leased Employee or as an employee under Code §414(o).

(e) Maternity/paternity/FMLA/military leave. Solely for purposes of determining whether a Break in Service has occurred in a Computation Period, an individual who is absent from work for maternity or paternity reasons will receive credit for the Hours of Service which would otherwise have been credited to such individual but for such absence, or in any case in which such hours cannot be determined, 8 Hours of Service per day of such absence. For purposes of this paragraph, an absence from work for maternity or paternity reasons means an absence:

(1) by reason of the pregnancy of the individual,

(2) by reason of a birth of a child of the individual,

(3) by reason of the placement of a child with the individual in connection with the adoption of such child by such individual, or

(4) for purposes of caring for such child for a period beginning immediately fo