Item C25
Revised 3/99
BOARD OF COUNTY COMMISSIONERS
AGENDA ITEM SUMMARY
Meeting Date: Auqust 21,2001
Bulk Item: Yes XXX No D
Division: Manaqement Services
Department: Administrative Services
AGENDA ITEM WORDING: Approval of Amendment to Deferred Compensation Plan
with Valic (The Variable Annuity Life Insurance Company).
ITEM BACKGROUND: The Internal Revenue Service recently issued new proposed
requlations under Section 457 of the Internal Revenue Code, which qoverns deferred
compensation plans maintained by state and local qovernmental employers. Technical
corrections to the Economic Growth and Tax Relief Reconciliation Act of 2001
(EGTRRA) were also included in the recent Job Creation and Worker Assistance Act of
2002. The approval of the above Amendment incorporates those chanqes.
PREVIOUS RELEVANT BOCC ACTION: On April 19, 2002. the Board of County
Commissioners adopted Resolution Number 161-2000 approvinq The Variable Annuity
Life Insurance Company (Valic) to offer as an alternative provider their qualified deferred
compensation plan. .
CONTRACT/AGREEMENT CHANGES Changes to various definitions contained in
plan to be in compliance with the Internal Revenue Code and the Economic Growth and
Tax Relief Reconciliation Act of 2001.
STAFF RECOMMENDATION: Approval.
TOTAL COST: None
COST TO COUNTY: None
REVENUE PRODUCING: Yes D No XX
BUDGETED: Yes D No D Not Applicable
AMOUNT PER MONTH
YEAR
APPROVED BY: COUNTY ATTY 0 OMS/PURCHASING
f
DIVISION DIRECTOR APPROVAL;'\I:. ._ , .
DIVISION DIRECTOR NAME: James L. Ro rts'J. ,.,,,",-.,. ,
!:'~
DOCUMENTATION: INCLUDED: XX TO FOLLOW: D NOT REQUIRED: D
DISPOSITION:
AGENDA ITEM #:
~~.
MONROE COUNTY BOARD OF COUNTY COMMISSIONERS
CONTRACTS~ARY
Contract with: The Variable Annuity Life Contract #
Insurance Co. (V ALIC)
Effective January 1,2002
Date:
Expiration None
Date:
Contract Purpose/Description:
Amendment to include regulation changes in the Internal Revenue Code, Section 457, which
governs Deferred Compensation Plans. It also includes technical corrections to the Economic
Growth and Tax Relief Reconciliation Act of 200 1.
Contract Manager: Sheila Barker X4462 Administrative Svcs./#1
(Name) (Ext. ) (Department/Stop #)
for BOCC meeting on 8/21/02 Agenda Deadline: 8/7/02
CONTRACT COSTS
Total Dollar Value of Contract: $
Budgeted? YesD No D
Grant: $
County Match: $
None
Account Codes:
Current Year Portion: $
- - -
----
- - -
----
- -
----
- - -
----
Estimated Ongoing Costs: $_/yr
(Not included in dollar value above)
ADDITIONAL COSTS
For:
(eg. maintenance, utilities, janitorial, salaries, etc.)
CONTRACT REVIEW
Division Director
Changes
Date In Needed
YesD No
Risk Management <& -'(3.. Cd- YesD Nog
O.M.B./Purchasing YesD No0 .J;......dA" I/,.'c~o.--Ll.:...(>t../
COWlty Attorney~- '".: ~ 't.. YesD Not)!J ~
Comments: ~
J'1-0.?l
OMS Form Revised 2/27/01 Mep #2
I1DJ VALle
The Variable Annuity
Life Insurance Company
2929 Allen Parkway
Houston. TX 77019
MONROE COUNTY
MA YOR, CHARLES "SONNY" MCCOY
MAYOR
5100 COLLEGE RD
KEY WEST, FL 33040-4319
Rr ~ -" '-I) <J!~;/O f
MA~. -\' ._, nv
t \, i~.:\..r ~ .JI
RE: New Section 457 Plan Guidance
Dear Plan Sponsor:
The Internal Revenue Service (IRS) recently issued new proposed regulations under Section 457 of the Interna]
Revenue Code, which governs deferred compensation plans maintained by state and local governmental employers_
Also, technical corrections to the Economic Growth and Tax Relief Reconciliation Act of2001 (EGTRRA) were
included in the recent Job Creation and Worker Assistance Act of 2002.
In particular, please note that:
· All plan sponsors will need to adopt the enclosed plan amendment. As with all matters relating to adoption or
amendment of an employer-sponsored retirement plan, you should consult your counsel. If you elect not to
adopt the amendment, please notify us. Otherwise, we will assume that you have adopted the amendment.
Please return a copy of the ~~u_~<!!!meI)dment to _~IG V ;\LI~;
· Loans can now be offered to governmental 457(b) plan participant... A separate amendment is required to add
the loan provision to your plan. Contact your AIG V ALIC fmancial advisor for more information.
The Proposed Regulations
The new proposed regulations provide guidance concerning certain changes, clarify issues arising under the old final
regulations and set forth rules about long-standing issues that had not been previously addressed.
Because you are a valued AIG V ALIC client and 457(b) plan sponsor, we have summarized for you pertinent
provisions of the proposed Section 457 regulations and technical corrections:
Deferral Limits
· Address the treatment of excess deferrals and provide for the self-correction of excess deferrals by
governmental 457(b) plans.
Distributions
· Provide that plan termination may be a distributable event under the plan.
· Provide examples of events that may constitute an unforeseeable emergency. (The definition of
"unforeseeable emergency" includes examples that are similar to those currently found on AIG V ALlC
unforeseeable emergency forms.)
· Clarify that for participants in governmental 457(b) plans who ended employment before
January I, 2002, no plan distribution amount will be included in gross income until actually paid. As a result,
existing irrevocable distribution elections may be changed.
Plan Loans
· Provide that non-taxable loans may be made from governmental 457(b) plans if the IRS code requirements
applicable to plan loans (maximum loan amount, repayment requirements, etc.) are satisfied.
.\tlf'!nher of American Inremur:"r'ill (imufJ. {fie.
AMENDMENT
TO
DEFERRED COMPENSATION PLAN
(Governmental)
Notwithstanding any provision of the Plan to the contrary and subject to any limitations
under the Code, the Plan is hereby amended as follows, effective January I, 2002, unless
otherwise indicated:
I. Includible Compensation: Includible Compensation of a Participant shall mean,
with respect to a taxable year, the Participant's compensation, as defined in Code
section 415(c)(3), for services performed for the Employer. The amount of
Includible Compensation shall be determined without regard to any community
property laws.
2. Excess Deferrals. Any amount deferred in excess of the Maximum Limitation or
Age-Based Catch-Up Contribution shall be distributed to the Participant, with
allocable net income, as soon as administratively practicable after the Plan
determines that the amount is an excess deferral. An excess deferral as a result of
a failure to comply with the individual limitation under Prop. Treas. Reg. section
1.457-5 for a taxable year may be distributed to the Participant, with allocable net
income, as soon as administratively practicable after the Plan determines that the
amount is an excess deferral.
3. Coordination of Catch-Up Contributions. Utilization of the catch-up limitations
under the Plan, including Age-Based Catch-Up Contributions, shall be subject to
any limitations imposed under the Code. Except as otherwise permitted under the
Code, a Participant may not utilize both the Catch-Up Limitation and the Age-
Based Catch-Up Contribution in the same year. The Age-Based Catch-Up
Contribution shall not apply for any taxable year for which a higher Catch-Up
Limitation applies.
4. Accumulated Sick Pay, Accumulated Vacation Pay and Back Pay. A Participant
may elect to defer accumulated sick pay, accumulated vacation pay and back pay
for any calendar month if an agreement providing for the deferral is entered into
before the beginning of the month in which the amounts would otherwise be paid
or made available and the Participant is an Employee in that month. Any
deferrals made under this section are subject to the Maximum Limitation,
including Age-Based Catch-Up Contributions.
5. Distribution upon Plan Termination. In the event that the Plan is terminated,
amounts deferred under the Plan (and all Plan assets) shall be distributed to all
Plan Participants and Beneficiaries as soon as administratively practicable after
the termination of the Plan.
I. INTROOUcnON
AMENDMENT 70 DEFERRED COMPENSATION PLAN
(Governmental Employer)
/)1 OivlZ<J~ WVN1I1
I heresn:ui:er. tne .. E~:lIO\1:r . J ia:reo\' exel.:utr.:s UlIS .l.o"enament In connectlun Wlrn t..-:...
(hc:n:snmer. me: "rim I punu:uu ro SCl.:t1on 'i-;:- UI me imem:1i Rc:vcnue: Lude ur l'lS6.;1)o .:une:n~-d (rhe "Cudc"./.
11. PLAN ELEcnONS
1.01 Eff'ecri,'~ D;lr~ :Chl,.'ck one: 1
~ amendme:nt IS c:xc:::uted in connc:a:on \'1m :1 new rim ;md the: e:rT~"e: cUre: is
o This is an amendment to :1l1 aisring Plm. wNch "':IS oClblished e:ttecti\.c:
The e:net::n1: d.ue or' this amendment IS .
.tf / I /7.--0 d c)
2.02 E.'!:dusi\'c: Bo:-nc:':r. :,mountS hc:lJ under rhis rim sn:u1 be: held in trust. In :1l1nuirv contr:1c:rs. or in one or more C'~-:odi:u
:!CCCuntS ror ti:: c::rciusl\'e benerit or rIm p.U't:':I!,:1l1tS ;mci [heir bcne:riciJIlo :u deseribed in section; 01, (CheCK onel
~'l! .l1nnrnlnmr IS t:l.l'17I1l'n'1II rnll1:,',710n 11'11;' a IIrtl.l'lllll'SftlDlisl'<'!I '-rfrrrll'r nil tiT afi" ,'lIglat .20. 19%
this opt/o': m"st v,' s..in.'uIL
O '.
1\:0. .:;,...11(;11 i,OI :/,,,il 11m .//'!',,' ffI (/111 i'~~;j. ir:/"S tI.flt/nll fj )..In'ral. rI." i~_~J1 /l'lIi' n'(!IIlfT".mrr;trr ,III/..mlll/rlll U'. ,,:1II11J1TV I, 199')
Z.03 Disrribution 'wnom r>:tmcio:tnr's mnsc:nr. ~null :!CCCuntS of cercin in:1cti\'c: ;-:uricip:1l1ts nuy be: distributed
without the: p:utJcipantS' consent :u described in ~on -\ 02.. (Chc:ck onc:,
a Yes. if the to=! amounr p~':1ble: ro :l p:uricip:u1t under rhe: PI:m uoes nor acced
(inmT an lIInDunt lip tD $5.0001.
~ 3.02 shall lint "Pply In Ihi,l'!.:lI.
2.04 ~rrici9:tnr's demon fn ~... disrrihll[inn or' :lc~nUnr h:tbnC!!. A p:uricip:mr m:!.)/' c:lc:cr ro n:ccivc: :l distribution
ofhis or her :zo:caunr b:t1:tna::u desc:ribed in ~on -103. (CJu:ck and
~ if the real amounr ~':1b~e: to :l p:uricip:mr under the P1:m does nor aa::d ?CXJ 0
a~~an~muDmS~OOOL
o No. S~rnDn 3.03 sh~illlot Ilpp{V to this 1':'011.
.
~.o') IrrevnC:lbJ~ dl~tnn. (Che:ck unc, nlc ;lrJditlon.u dl:~:tlon m ddi:r commC'nl.:c~c:nr ufbenctits:u descnhed in ~crt'on :; 04
is aY:l.ih&ble: ro pmicip:mtS.
~
o No. SmiDn 3.04 shnllllot npp(v 10 this P!.zn.
III. PLAN PROVISIONS
3.0 I y mvi~in" nf rh . n rh h F. ., 0'"
(a) A5 of the: ..Lte of this .:unc:numcnr. .ill amountS currentlv or thc.-rc::mer hdJ unuer rhe: PI:1l1. indudins :1mouna dc:fc:m:d :1nu l.":1tninSS
or other :K..'"Umuhuions arrribut:1hle: lhe:n:to. ~Iull be: h",.w for the ~usi\'': bc.:nctir of Pbn ~cip:1l1tS :md bc.-ncrici:uics (i) in annuir;'
can~ ut Iii) in nust or in one or more CLWod.i:d aanUlltS pursu:ant ro one or more ~ wrim:n .lImnunena. Any s~
annuity contaCt. trust. ur "''USl:odw ~unr must gtUEy the requiremcntS of sc:aion <i"i7Cs)O) ot the ~ For purpoSl.'S uf t~IS
:amc:ndment. the terms .'parriop:mr - ;lnu "!x't1chci:ln:' shall be: unde:rstoo.i to mer:ziso to conringenr bcnc:t'~.cs an4Jor spo~cs. ter-
mer spouses. or children or p:ltrlcip:mrs rl'r whose: bc:nc:tir :amountS :1re bc:inl: hdd unuc:r the: Plan pW'SU:U1r ro me: rcrms of:1 domestiC
rd:uions ortier which Ius hc:c:n n.'co~nlZ&.-u under the: terms of the: Plm. .
(b) In :uJoptin~ this :1mc:ndme:nr. till: f.mpl""C'r itm'tx::ahh' mttJUI1CC:S. un h..:h.1lt' of the Emplovc:r. ilS suca:ssors tJr:tS ~,:1n~ c;!;:.im ~r
righr wilicr. it m:l\' h;l\1:' n:t:llnl.-U IU 1I!\C ~mnuntS held und"'T rhe: 1'1.111 li,r It> ,l\\'n nc:nerit or ti,r rhe b(.'fll.'Iir ot' its .::aiuors. nus :1men~-
mc:nr shaii .;onstlrute: InStruCtlllll In rhe: b'U(.T or :1n\'..'Iimuin' cnnrl':lcts rur.:n;W.-u under rhe: PIJn ro rl.'CCrd u:-on i,s.n:ccrds th:lr s~cn
cunrl':lCU .I:;: ndd b\. rhe ~molUn-r li,r In... C'xclusi,'C' benl.'Iir nt' p:1rt1clOJnri .1I1U IlCn"''IicUrll.:s. Anv discrc:t1ulUt"." ~uUtonn: n.'S~'C'~ 10
the Emplo\'t't lor rn :1n\' :IUmlOl~lr;llor or .1UminUl':1II\1: commmC:C:1 undcr r~c: 1'1.11\ or unue:r :1"" :lnnUln' conrr-_": ndd unacr tne: I LlIl.
ro rhe c:crenr tne excro~ rnerL't" wlluiJ OrnCl"'1\C be IIlCOnSISrcnr wlrh tr:l. .Ime:miment. sh:1l1 he c:cero~~ lor ::1e: c::xdusivc nent:nt or
rim f1~rtl.::o:mrs :1nJ b(.'fll.-rician~-:.. "\Il\" h,ucr 01 :1l1 :1l1nUln'l.:ontt:1ct nc:i~ unul.'!' rhe: i'bn siulllu\1:' no :1urho:-:t\. to ~ :lnv :1mouncs
tram, sucil.::cnt~ctS ro .111\' c.rooirnr ot rhe i::.mplo~. Jnd ~~~ h;l~'I: no ~un' m m~ulrc; in~o ~h_~~~!di~' or :1n\':'l:CUC:Stc bv t~e:,E:noi~~
or kn :an ~c.nl1nIVt":!rn,. nr .'f'''''n',r~...._ ."___ __ J *__......__ .
lel Amounts ne:id uncier t..,e: i'bn oursU:1rlt to me: on:'Cl:Qm~ p~n ~n.ui .;ononuc to DC SUOICC to l'lm oromoioons ~nst J.S.Sl~l!:~:,
,lhe::uoon. ;lI1oc::::oon. .;om"t:",-:..,~ or :=ncumor.ma: or m\' r\'pc 0\' J OJrtI:::OMlt or ocneric::..-.'. accor :15, arnc::'\\1~ Oro\1UI."C ~:.;c
the: PI.:m.. . .
IJl In me: cVcnt or;: n:cuor C\. ,I DJltICIO:UU rm ;: ri.1Il$ri:r ft) J ui:u'l unaer Wnlcn ::mounts :uc: not held in the mmner ac:sc:no,--c I::
p~~n IJJ. )ucn tr:uurer m.ui be oemurteu Onl\' ,; omer,\1'iC o~mca 0\' me Phn .llll.l Jopi,cole law. in no c:\'mt nul' me: t:.7.::::u\'l."r
cuse suc.., J rr.msrt:r to De mJce. na:Ot :U me ~UCSt or. J pJ.nlcl~mt.
I cl ~~onslbiiir\' tor the 'lCir:cuoll ur InVcstment Jirern:ltlvcs ror I'I.lll ~ts sn::il be n:r:unt.oU Iw rnc Emoio\'er. ;md the: E:n~io\'t."f' sr.Jil h::...e
rhe n~::rlt ro mociir.' the seic:cnon or Investment Jirem:lm'l:S rrom time ro tlme. How~'t."f'. p:unci~:m~ md bcncric:imc:s m:lv ::Iioc::::
Jrnounts hcid in tnm Jccounts or nrner,\1SC c:reQm:ci lor their benerit unaer the Pbn J1tlon!: rhe iO\'l:Stmcnt :1irem:1tlvcs sei:c:::::.
bv the Emoim'er. ::mi the i:.molo\'c:r ~n:u1 wuse ~uc:n amounts ro Oc )0 J.i1OCJ.tea Wllnln J rt.":ISon:lcle time: :1li:er rhCrc:a:10t or' O:1I'tlC1::::'-::
IIlStruCtlons. ur mJ\' Imtrucr me I:.1>Uer. trusree. "r cw;row.1I1 {ll ,1I..tX!'r SUUl. :uloe.:mon inStructions Jirc:cri\' ttcm r;U'tlC1~:r.ts _.~
bcnerici:uic:s :IS rt:?rcsenUtl\.c:s or tne: i:Jnpio\'er. . .
3,02
(J1 such :unount doo not ace::d the: doll;u- limit under section -+ II (.1)( II HAl lit rhe Code: lor such Ic:sscr::mount :IS may be: decree b'
rhe Empioyer under sl.'Ctlon 2.0.31. :md
(b) no amounr h:lS bem dderrco under tht: Pt.1n wirh rc:spe:a ro rhe pJrricio:ll'1t durin!: tne rwo-yc:;;:r period ending on the d:m:
of rhe uismbmion. .1I1d ' -
(cl chere nJ.S been nil pnor Ji~mnutl()1l unlier rhe I'I.Ill tll the 1'.lrm;Il'Jl1C unlier TrllS ~el.:[1lln .~,O:! or unuer Sl'Crion 3.03.
\,0.3 P,lrnCII",llH ~ ,.Icctmn In f,'Ct'I"" djqrd'llTHlI1 I,. r1". F IT'loinn'r '" {'k.t:r~ llfltkr "'cno,, ., 04 ,I 1':lrnClO:mr m:'l\" deer m
rect:I"t' :1 di~tnbunon or. The rnr:d ,ImnUIH 1':1\':'IOle m him or her under Th~ PI:," II'
(a) such :unounr docs not c::tec:d rhe dOll;1t limit under sc:crion 411 (:1)( IIlCA1 of the Coue lor such Ic:ssc:r amount :IS may be decred by
the Emplo~'er unclc:r seerion 2.041. md
(bl no JCllOUnr h:lS ~:cn ud'i.'fTt'd under the Phn with n:speer to the p:1rricipmt uuring the twn-vcr period ending on the d:1te
of the uistribuuon. md .
(el there h:lS bl'Cl1 no prior distribution untkr the: rIm to the p:uncip:mt under this sc.'Ction .3.03 or under sc:aion 3.02.
3.04 Irrevoc:lbl~ d~crion If rhe Emnl('l\"~r <('I d~crs under ~ecrion ~ 0'5 norwirh~r:lndin~:'I n:!rricio:mt'~ orior irrt:'mcble dection ro
defer o:n'menr ('If :lnv or Ill! Ilmounrs under thi~ Phn :lS nmvided lw .eerion 41\7 of the Code :lnd th~ Tr~mrv ~btion'
rh~~und~r, :tny <uch l"l:'lrtlcim"r m:!\' t'!~cr rn def~r commencement ot distributions und~r rhi~ Pbn if.
IJ1 the: ciealon IS m:u:ic mer ::mOUntS m:l\' he a\':til:tblc under rhe PI.m III Jccordmcc: with sealon 417(uH IlCA) of the Code:. Jllli beiol't:
c.;ommencemenr of such di~rribUtlons..1lld
lb) then: h;u been no prior elt.'Ctilln by ~ud1 pJrtlcip:1nt under this Sl't.:t10n ,;.04.
J.O'5 [')d~rr:ll lim;(':1tion. The' It1J:'Cimum :1mnllnr r1':'lt m:w he dd~rrt'd IIntler ('he Ph" wirh rt...o~r TO :tny f'l:trricio:!nt tnr :tnv
t:IX:!ble \'t":lr .h:111 he :ltliustt:d ti'f cmr-nt:'li\';nv ,"cr~:m.~ in :lccord:1nce ",ifh sectIOn 4 C;7(clll C;) ot' the ('otlc:.
S;gn'" h", ~: ~
Nom, <p,;n:- 5 t,"; ~ C ~~... "-VI
I
TIde: Ct,q,,''''..,..,461 1-1....,,,..c. 0CA'" 8.......-1.;. CO'1l\ m;~S/""'~~S
,I.av lit'
~:
~t).::l
VA to'" .",'"
/110 Nt< Q~ CV ttI~~
DEFERRED COMPENSATION PLAN
ARTICLE I. INTRODUCTION
The jr/W&C7C (/ ~ (the "Employer") hereby eslabUshes
the Deferred Compensation Plan, hereinafter referred to as the "Plan".
The Plan is intended to be an eligible deferred compensation plan under section 457 of the
Internal Revenue Code of 1986, as amended. The primary purpose of this Plan is to attract and retain
Qualified personnel by permitting them to provide for benefits in the event of their retirement or death.
Nothing contained in this Plan shall be deemed to constitute an employment agreement between
any Participant and the Employer and nothing contained herein shall be deemed to give any Participant
any right to be retained in the employ of the Employer.
ARTICLE II. OEFINmONS
2.01 Account: The bookkeeping account maintained for each Participant reflecting the cumulative
amount of each Participant's Deferred Compensation, including any income, gains, losses, or
increases or decreases in market value attributable to the Employer's investment of the
Participant's Deferred Compensation. and further reflecting any distributions to the Participant
or the Beneficiary and any fees or expenses charged against the Participant's Deferred
Compensation.
2.02 Aareemer11: A Deferred Compensation Agreement entered into between a Participant and the
Employer and any amendments or modifications thereof. Such Agreement shall fix the amount
of Deferred Compensation, establish the time when the payment of benefits shall commence.
specify the Participant's investment selection with respect to his Deferred Compensation.
designate the Employee's Beneficiary or Beneficiaries and incorporate the terms, conditions, and
provisions of this Plan by reference.
2.03 Annuitv Contract: A group fixed, variable or combination fIXed and variable annuity contrad
issued by The Variable Annuity Ufe Insurance Company (VAUC) or by any other licensed life
insurance company. and approved for sale in this State, which provides for periodic payments
at regular intervals, whether for a period certain or during one or more lives.
2.04 Beneficiary: The Beneficiary or Beneficiaries designated by the Participant in his Agreement
who shall receive any benefits payable hereunder in the event of the Participant's death. If more
than one designated Beneficiary survives the Participant, payments shall be made equally to the
surviving Beneficiaries. unless otherwise provided in the Agreement. If no Beneficiary is
designated in the Agreement. if the desigl:1ated Beneficiary predeceases the Participant, or if no
designated Beneficiary survives the Participant for a period of fifteen (15) days, then the estate
of the Particicant shall be the Beneficiary. However. a Participant may deSIgnate a contingent
Beneficiary (or Beneficiaries) wtlo snail become the Beneficiary under this Plan in the event that
the pnmary Beneficiary does not survive the Participant for a period of 15 days.
2.05 ~: The Internal Revenue Code of 1986, as amended.
2.06 Contr':lctor: The Variable Annuity Life Insurance Company (VAlle) or such other entity as the
Employer designates to perform administrative services under this Plan.
2.07 Deferred ComDensation: The amount of Normal Compensation otherwise payable to the
Participant which the Participant and the Employer mutually agree to defer hereunder, any
amount credited to a Participanfs Account by reason of a transfer under section 8.01, or any
other amount which the Employer agrees to credit to a Participanfs Account, and which does not
exceed the Maximum Limitation.
2.08 EmDlovee: Any individual. whether appointed, elected or under contract. providing services for
the Employer for which compensation is paid.
2.09
EmDloyer: The
/l1o 11/ ~O E
COUNTY
/
2.10 Includible ComDensation: The amount of compensation payable to a Participant from the
Employer wnid1 is indudible in the Participanfs gross income for federal income tax purposes.
Such term does not in dude any amountexdudible from gross income under this Plan or any
other plan described in section 457(b) of the Code or any other amount excludible from gross
income for federal income tax purposes. Indudible gross income shall be determined without
regard to any community property laws.
2.11 Maximum Limitatiof]: The maximum amDunt that may be deferred under this Plan for the
taxable year of a Participant Such amount shall be either the Normal Umitation or Catch-Up
Umitation, whichever is applicable.
(a) NORMAL UMITATlON: The maximum amount deferred shall not exceed the lesser of
$7,500 or 33-1/3% of Indudible Compensation (ordinarily this shall be the equivalent of
the lesser of $7,500 or 25% of Normaf Compensation).
(b) CATCH-UP UMITATlON: For each one of the last three (3) taxable years of a Participant
ending before the Participanfs attainment of Normal Retirement Age, the maximum
amount deferred for each such year shall be the lesser of
(1) $15,000: or
.
(2)
the sum of the Normal UmitatiDn, plus that portion of the Normaf Limitation not
used in each of the prior taxable years of the Participant commencing after 1978
in which (i) the Participant was eligible to participate in this Plan or the plan of
another employer, and (ii) compensation deferred under this Plan (or such other
plan) was subject to the deferral limitations set forth in this section.
A Participant may utilize the Catch-Up Umitation only if he has not previously utilized it
with respect to a different Normal Retirement Age under this Plan or any other plan.
(c) OTHER PLANS: The amount exdudible fi'om a Participant's gross income for any taxable
year under this Plan or any other plan under section 457(b) of the Code shall not exceed
$7,500 (or such greater amount allowed under paragraph (b) of this section) less any
amount exduded from gross income under sections 403(b), 402(a)(8), or 402(h)(1)(8) of
the Code. or any amount with respect to which a deduction is allowable by reason of a
contribution to an organization under section 501(c)(18) of the Code.
2.12 Normal Comoensation: The amount of compensation which would be payable to a Participant
aDe 1/90 Page 2
by the Employer if no Agreement were in effect to defer compensation under this Plan.
2.13 Nonnal Retirement Aae: Age 70-1/2. unless the Participant has elected an alternative Normal
Retiremem Age by written instrument delivered to the Employer prior to Separation from Service.
A Participanrs Normal Retirement Age determines the period during which a Participant may
utilize the Catch-Up Limitation of section 2.11 (b) hereunder.
Once a Participant has to any extent utilized the Catch-Up Limitation of section 2.11(b), his
Normal Retirement Age may not be changed.
A Participants alternative Normal Retirement Age may not be earlier than the earliest date that
the Participant will become eligible to retire and receive unreduced retirement benefits under the
EmployerS basic retirement plan covering that Participant and may not be later than the calendar
year in which the Participant attains age 70-112.
If a Participant continues employment after attaining age 70-1/2 not having previously elected
an altemative Nonnal Retirement Age, the Participant's alternative Nonnal Retirement Age shall
not be later than the mandatory retirement age, jf any, established by the Employer or the age
at which the Participant actually separates from service if the Employer has no mandatory
retirement age.
If the Participant will not be eligible to receive benefits under a basic retirement plan maintained
by the Employer, the Participanfs Normal Retirement Age may not be earlier than attainment of
age 55 and may not be later than the calendar year in which the Participant attains age 70-112.
2.14 ParticiDant Any Employee who has enrolled in this Plan pursuant to the requirements of Article
IV.
2.15 Plan Year: The calendar year.
2.16 Ret'remel1t: The first date upon which each of the following shall have occurred: Separation
from Service and attainment of age 65.
2.17 SeDaration from Service: Severance of the Participant's employment with the employer within
the meaning of section 402( e)( 4 )(A)(iii) of the Code.
ODC 1/90 Page 3
ARTICLE nl. AOMINISTRA nON
3.01 This Plan shall be administered by a Committee (the "Committee") of one or more persons
appointed by the Employer. The Committee shall act as the agent of the Employer in all matters
conceming the administration of this Plan. The Committee shall have full power to adopt amend.
and revoke such rules and regulations consistent with and as may be necessary to implement
this Plan, to enter COntracts on behalf of the Employer under this Plan. and to make discretionary
decisions affecting the rights or benefits of Participants under section 6.06 of this Plan.
3.02 Any Employee who is charged with administrative responsibilities hereunder may participate in
the Plan under the same tennsand conditions as apply to other Employees. However. he shall
not have the power to participate in discretionary action taken with respect to his participation
under section 6.06 of this Plan.
3.03 The Employer may enter into an agreement with a Contractor to provide nondiscretionary
administrative services under this Plan for the convenience of the Employer including. but not
limited to. the enrollment of Employees as Participants. the maintenance of Accounts and other
records. the making of periodic reports to Participants. and the disbursement of benefits to
Participants.
.
aDC 1/90
Page 4
ARTICLE IV. PARnCIPA TION IN THE PLAN
4.01 An Employee becomes a Participant when he has executed ana entered into an Agreement with
the Employer.
4.02 An Employee may become a Participant as of the first day of any calendar month by entering into
an Agreement with respect to compensation not yet earned. A new Employee may become a
Participant on the first day of employment by entering into an Agreement on or before the first
day of employment with respect to compensation not yet earned.
4.03 The Agreement shall defer compensation not yet earned. and each Agreement must be made
on or before the beginning of the month in which it is to become effective or on or before the first
day of employment, with respect to a new employee.
4.04 At the time of entering into or amending an Agreement hereunder. a Participant must agree to
defer a minimum amount per month as specified by the Committee.
4.05 A Participant may not amend or modify an executed Agreement to change the amount of
Deferred Compensation except wit.h respect to compensation to be earned in the subsequent
calendar month and provided that notice is given prior to the beginning of the month for which
such change is to be effective. A Participant may change the Beneficiary designated in his
Agreement at any time by giving notice to the Employer.
4.06 A Participant may revoke his Agreement and thereafter be restored to his Normal Compensation
in the subsequent caJendar month, by giving notice to the Employer prior to the beginning of the
month for which such revocation is to be effective.
4.07 A Participant who returns to active service with the Employer after a Separation from Service,
or who has revoked his Agreement under section 4.06, may again become an active Participant
by exeaJting a new Agreement with the Employer prior to the beginning of the calendar month
as to which it is to be effective.
.
4.08 Compensation may continue to be deferred under this Plan with respect to a Participant who is
on an approved leave of absence from the Employer with compensation, and all of the rules of
this Article shall apply with respect to making, amending or revoking any Agreement for such a
Participant. If a Participant is absent from work without compensation for a period of not more
than six months, whether by reason of illness. strike, lockout. shutdown or otherwise. his
Agreement will remain in effect and compensation will again be deferred thereunder when he
returns to work.
QDe 1/90
Page 5
ARTICLE V. INVESTMENT OF DEFERRED COMPENSATION
5.01 For tt1e purposes of satisfying its obligation to provide benefits under this Plan. the Employer may
invest the amount of compensation deferred by each Participant in Annuity Contracts as
specified in Participants' Agreements. However. nothing in this section shall require the
Employer to invest Deferred Compensation in any particular form of investment. All Annuity
Contracts and other invesunents held by the Employer with respect to this Plan. including all
. property or rights purchased with Deferred Compensation and all income attributable thereto.
shall be the sole property of the Employer, and shall not be held in trust for Participants or as
collateral or security for the fulfil/ment of the Employers obligation under this Plan. Any such
investments shall be subject to the claims of all creditors of the Employer, and no Participant or
Beneficiary shall have any vested interest or secured or preferred position with respect to such
investments or have any claim against the Employer except as a general creditor.
5.02 The benefits paid to a Participant or Beneficiary pursuant to Article VI of this Plan shall be based
upon the value of the Participanfs Account. In no event shall the Employers liability to pay
benefits exceed the value of the Participanfs Account, and the Employer shall not be liable for
losses arising from depreciation or shrinkage in the value of any investments acquired under this
Plan.
5.03 Each Participant shall receive periOdic reports. not less frequently than annually. showing the
then-current value of his Account.
.
acc 1/90
Page 6
ARTICLE VI. BENEFITS
RETIREMENT BENEFITS AND ELECTION ON SEPARATION FROM SERVICE
6.01 Except as otherwise provided in this Article. the distribution of a Participant's Account shall
commence April 1 of the calendar year following the calendar year of the Participant's
Retirement. and such distributions shall be made in accordance with one of the payment options
described in section 6.02. Notwithstanding the foregoing, the Participant may irrevocably elect
within 60 days following Separation from Service to have the distribution of such Retirement
benefits commence on the first day of a specified calendar month that is (i) no earlier than 61
days after the Participant's Separation from Service or 30 days after the election is made,
whichever is later, and (ii) no later than April 1 of the calendar year following the year of the
Participant's Retirement or attainment of age 70-1/2, whichever is later. A Participant's election
of a benefit commencement date that is made in his Agreement prior to Separation from Service
may be changed at any time up until the 60th day following the Participant's Separation from
Service. after which the election shall become irrevocable. provided, however. that if the
designated benefit commencement date has passed prior to the Participant's Separation from
Service, the election shall have no effect. and the benefit commencement date shall be
determined under the first sentence of this section.
PA YMENT OPTIONS
6.02 A Participant (or a Beneficiary as provided in section 6.05) may elect to have the value of the
Participant's Account distributed in accordance with one of the following payment options
provided that such option is consistent with the limitations set forth in section 6.03:
(a) Life Annuity;
(b) Life Annuity with 60, 120, or 180
monthly payments guaranteed:
(c) Unit Refund Ufe Annuity;
(d) Joint and Last Survivor Annuity (spouse only);
(e) Lump Sum:
.
(f)
Term Certain Annuity with 36, 48, 60, 72, 84, 96, 108,120,
132, 144, 156, 168, or 180 monthly payments guaranteed:
(g) Any other method of payment agreed upon
between Participant and Employer.
The election of a payment option must be made at least 30 days before the payment of benefits
is to commence. If a Participant fails to make a timely election of a payment option, benefits shall
be paid under a Ufe Annuity with 120 monthly payments guaranteed.
UMITATlON ON OPTIONS
6.03 No payment option may be selected by the Participant (or a Beneficiary) unless it satisfies the
requirements of Code sections 401(a)(9) and 457(CJ)(2), including that payments commencing
before the death of the Participant shall satisfy (i) the incidental death requirement under Code
section 457(d)(2)(B)(i)(I), and (ii) the substantially non increasing requirement of Code section
457(d)(2)(C). For purposes of determIning required distributions under section 401 (a)(9) of the
OOC , /90 Page 7
Code. and applicable regulations. in the event no recalculation election is made. life expectancy
of a Participant and his spouse will be recalculated (except in the case of a life annuity). but no
more than once each year.
POST-RETIREMENT DEATH BENEFITS
6.04 Should the Participant die after he has begun to receive benefits under a payment option, the
guaranteed or remaining payments, jf any. under the payment option shall be payable to the
Participant's Beneficiary commencing with the first payment due after the death of the Participant.
Payment to the Participant's Beneficiary must be made at least as rapidly as under the method
of distribution in effect at the time of the Participant's death. If the Beneficiary does not continue
to live for the remaining period of payments under the payment option. then the remaining
benefits under the payment option shall be paid to the Beneficiary's estate. In no event shall the
Employer be liable for any payments made in the name of the Participant or a Beneficiary before
the Employer or its agent receives proof of the death of the Participant or Beneficiary.
PRE-RETIREMENT DEATH BENEFITS
6.05 Should the Participant die before he has begun to receive benefits under section 6.01, a death
benefit equal to the value of the Participant's Account shall be payable to the Beneficiary
commencing on the 61 st day following the Participant's death. unless the Beneficiary elects a
later commencement date within 60 days of the Participant's death. Such benefit
commencement date shall not be later than that permitted under sections 401 (a)(9). 457(d)(2)
of the Code. and the regulations thereunder. Such death benefit shall be paid in a lump sum
unless the Beneficiary makes a timely election of a different payment option. The payment
option chosen by the Beneficiary must provide for payments to the Beneficiary over a period no
longer than the life or life expectancy of the Beneficiary. provided that such periOd may not
exceed 15 years if the Beneficiary is not the Participant's spouse. Should the Beneficiary die
before the completion of payments under the payment option. the value of the remaining
payments under the payment option shall be paid to the estate of the Beneficiary.
UNFORESEEABLE EMERGENCY WITHDRAWALS
6.06 Except as provided in this section. no amount shall be distributable to a Participant or Beneficiary
prior to the Participant's Separation from Service. In the event of an unforeseeable emergency
before or after Separation from Service or the commencement of Retirement Benefits. a
Participant may apply to the Employer to receive that part of the value of his Account which is
reasonably needed to satisfy the emergency needs. If such application for withdrawal is
approved by the Employer. the Employer shall pay the Participant such value as the Employer
deems necessary to meet the emergency needs. An unforeseeable emergency involves only
circumstances of sudden and unexpected illness or accident of the Participant or a dependent,
loss of property due to casualty, or other similar extraordinary or unforeseeable circumstance
arising as a result of events beyond the control of the Participant which would cause severe
financial hardship to the Participant if early withdrawal were not permitted. Payment may not be
made to the extent that such hardship is or may be relieved by other financial resources
available to the Participant, induding insurance reimbursement. cessation of deferrals under this
Plan or liquidation of other assets. to the extent the liquidation of such assets would not itself
cause severe financial hardship. Unforeseeable emergencies do not include the need to send
a child to college or the desire to purchase a home.
aoe 1/90 Page 8
TRANSITIONAL RULE FOR PRE-1989 BENEFIT ELECTIONS
6.07 In 1tle event 1tlat prior to January 1, 1989. a Participant or Beneficiary has commenced receiving
benefits under a payment option or has irrevocably eleded a payment option or benefit
commencement date. 1tlat payment option or election shall remain in effect notwithstanding any
o1tler provision of this Plan.
.
ODe 1'90
Page 9
ARTICLE VII. NON-ASSIGNABIUTY
IN GENERAL
7.01 Except as provided in section 7.02. no Participant or Beneticiary shall have any right to commute.
sell, assign. pledge, transfer or otherwise conveyor encumber the right to receive any payments
hereunder. which payments and rights are expressly declared to be non-assignable and
non-transferable.
DOMESTIC RELA nONS ORDERS
7.02 (a) Allowance of Transfers: To the extent required under a final judgment, decree, or order
(incJuding approval of a property settlement agreement) made pursuant to a state domestic
relations law, any portion of a Participant's Account may be paid or set aside for payment to a
spouse, former spouse, or child of the Participant. Where necessary to carry out the terms of
such an order, a separate Account may be established with respect to the spouse, former
spouse, or child who shall be entitled to make investment selections with respect thereto in the
same manner as the Participant, any amount so set aside for a spouse. former spouse, or child
shall be paid out in a lump sum at the earliest date that benefits may be paid to the Participant,
unless the order directs a different time or form of payment. Where the final judgment, decree
or order does not define a form or time of payment that is available under this Plan, the Employer
or Contractor shall have the right to interpret the final judgment, decree or order in a manner that
is consistent with the terms of this Plan. Nothing in this section shall be construed to authorize
any amount to be distributed under this Plan at a time or in a form that is not permitted under
section 457 of the Code. Any payment made to a person other than the Participant pursuant to
this section shaD be reduced by required income tax withholding; the fact that payment is made
to a person other than the Participant may not prevent such payment from being indudible in the
gross income of the Participant for Withholding and income tax reporting purposes.
(b) Release from Liabilitv to ParticiDant The Employer's liability to pay benefits to a
Participant shaD be reduced to the extent that amounts have been paid or set aside for payment
to a spouse, former spouse, or child pursuant to paragraph (a) of this section. No such transfer
shall be effectuated unless the Employer or Contractor has been provided with satisfactory
evidence that the Employer and the Contractor are released from any further claim by the
Participant with respect to such amounts. The Participant shall be deemed to have released the
Employer and the Contractor from any daim With respect to such amounts, in any case in which
(i) the Employer or Contractor has been served with legal process or otherwise jOined in a
PrDa!eding relating to such transfer, (ii) the Participant has been notified of the pendency of such
proceeding in the manner prescribed by the law of the jurisdiction in which the Proceeding is
pending for service of process in such action or by mail from the Employer or Contractor to the
Participant's last known mailing address. and (iii) the Participant fails to obtain an order of the
court in the proceeding relieving the Employer or Contractor from the obligation to comply with
the judgment, decree, or order. The Participant shall also be deemed to have released the
Employer or Contractor if the Participant has consented to the transfer pursuant to the terms of
a property settlement agreement andlor a final judgment, decree, or order as described in
paragraph (a).
(c) ParticiDation in Leoal Proceedings: The Employer and the Contractor shall not be
obligated to defend against or set aside any judgment, decree. or order described in paragraph
(a) or any legal order relating to the garnishment of a Participant's benefits, unless the full
expense of Such legal action is borne by the Participant. In the event that the Participant's action
(or inaction) nonetheless causes the Employer or Contractor to incur such expense. the amount
of the expense may be charged against the Participant's Account and thereby reduce the
Employer's obligation to pay benefits to the Participant. In the course of any proceeding relating
ODC 1/90
Page 10
.
aDe 1/90
to divorce. separation. or child support. the Employer and Contractor shall be authonzed to
disclose information relating to the Participant's Account to the Participant's spouse. former
spouse. or child (including the legal representatives of the spouse. former spouse. or child), or
to a court.
Page 11
ARnCLE VIII. TRANSFERS
TRANSFERS FROM OTHER PLANS
8.01 This Plan shall accept amounts deferred by an individual under another eligible deferred
compensation plan pursuant to section 457 of the Code. Any such transferred amount shall not
be treated as a deferral subject to the limitations of section 2.11, except that for purposes of
applying the limit of section 2.11, an amount deferred during any taxable year under the plan
from which the transfer is accepted shall be treated as if it had been deferred under this Plan
during sud1 taxable year and compensation paid by the transferor employer shall be treated as
if it had been paid by the Employer.
TRANSFERS TO OTHER PLANS
8.02 A Participant may elect to have any portion of the amount payable to him transferred to another
eligible deferred compensation plan. This election must be made before the eartiest date that
deferred amounts would otherwise be payable to the Participant under this Plan.
.
ace 1/90
Page 12
ARTICLE IX. AMENDMENT OR TERMINATION OF PLAN
The Employer may at any time amend or terminate this Plan. provided. however, that such amendment
or termination shall not impair the rights of Participants or their Beneficiaries with respect to any
almpensation deferred before the date of the amendment or termination of this Plan except as the same
may apply to maintaining the privileged tax status of the Plan. Participants shall thereafter receive their
Normal Compensation and benefits shall be paid as provided in Article VI.
If this Plan document constitutes an amendment and restatement of the Plan as previously adopted by
the Employer. the amendments contained herein shall be effective as of April 19, 2000 .
and the terms of the preceding plan document shall remain in effect t"rougl:l until terminated by
either party upon giving the other party sixty days prior wotten notlce
of termination.
ARTICLE X. RELATIONSHIP TO OTHER PLANS
This Plan serves in addition to any other retirement pension or benefit plan or system presently in
existence or hereinafter established.
ARTICLE XI. APPUCABLE LAW
This Plan shall be construed under the laws of the State of
~
~WITN~ ~EREOF, the Employer has caused this Plan to be signed by its duly authorized officers,
on this _ day of ~ . W,3-oo - ,
EFFECTIVE thel~day of ~ . 19~~o
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aDC 1/90
Page 1 3
.. .
DEFERRED COMPENSA nON AGREEMENT
This Agreement is made by and between
_ rParticipant"'.
("Employer'" and
The parties agree to and acknowledge the following:
A. The Participant confirms that he has received a copy of the Employer's Deferred Compensation
Plan and has reviewed and understands all of the terms. previsions. and conditions of the Plan. all of which
are hereby incorporated into this Agreement
B. Commencing .19.-. the Par1icipant agrees to defer the right to receive compensation
to the extent of S (per ) in return for the benefits specified in the Plan and this Agreement
authorizes the Employer to so reduce his compensation.
C. The Participants benefits under the Plan shall be based upon the amounts credited to the
Participants Acccunt, which shall reflect the Employer's investment of the Participants Deferred
Compensation. For this purpose. the Participant requests that the Employer invest the Participant's Deferred
Compensation under a group annuity contract issued by The Variable Annuity Ufe Insurance Company to
be allocated as follows: _% fixed; _% variable (specify desired percentages).
D. The Participant eleds the following date for the commencement of benefits after Separation from
Service: . The Participant may change this election at any time up until 60 days following
Separation from Service, at which time the election shaJI become irrevocable. The date selected may be (i)
no eartier than the 61st day following the Participants Separation from Service with the Employer. and (il) no
IaIBr than April 1 of the year following the year in which the Participant attains age 70-1/2 or Separates from
Service with the Employer, whichever is later.
E. The Participant's benefits shaD be paid under a payment option available under the Plan that is
selected by the Participant at least 30 days before the benefit commencement date.
F. The Participant designates the following Beneficiary (or Beneficiaries) in acccrdance with Article
VI of the Plan (specify full ~ relationshiD, and address):-
Primary:
Contingent:
Dated this _ day of
.19_.
Employer:
By:
Title:
Participant
Name:
Address:
SS#: