HomeMy Public PortalAbout2005.01.03 AIG 401k Retiremenet PlanCITY OF MCCALL
EXCLUSIVE BENEFIT GOVERNMENTAL 401(a)
NONTRUSTEED RETIREMENT PLAN
100801 GOV401
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
ARTICLE II
ADMINISTRATION
2.01 APPOINTMENT OF ADMINISTRATOR 4
2.02 DUTIES OF ADMINISTRATOR 4
2.03 POWERS OF ADMINISTRATOR 4
2.04 INFORMATION FROM EMPLOYER 4
2.05 EMPLOYER'S AND ADMINISTRATOR'S PROTECTIVE CLAUSE 4
2.06 PAYMENT OF EXPENSES 4
2.07 CLAIMS PROCEDURE 4
2.08 FORM OF NOTICES 5
ARTICLE III
ELIGIBILITY
3.01 CONDITIONS OF ELIGIBILITY 6
3.02 EFFECTIVE DATE OF PARTICIPATION 6
ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.01 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION
7
4.02 TIME OF PAYMENT OF EMPLOYER'S CONTRIBUTION 7
4.03 LIMITATION ON CONTRIBUTIONS 8
ARTICLE V
DISTRIBUTION OF BENEFITS
5.01 DISTRIBUTION OF BENEFITS UPON TERMINATION 9
5.02 DISTRIBUTION OF BENEFITS IN EVENT OF DISABILITY -
FOR PROFIT SHARING PLAN (IF APPLICABLE) 9
5.03 FORM AND TIMING OF DISTRIBUTIONS 9
5.04 DISTRIBUTION OF BENEFITS UPON DEATH 9
5.05 REQUIRED MINIMUM DISTRIBUTIONS 9
5.06 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN 10
5.07 DIRECT ROLLOVERS 10
ARTICLE VI
MISCELLANEOUS
6.01 PLAN AMENDMENT
6.02 PLAN TERMINATION
6.03 PARTICIPANT'S RIGHTS
6.04 ALIENATION
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11
11
11
6.05 DOMESTIC RELATIONS ORDERS 11
6.06 CONSTRUCTION OF PLAN
6.07 GENDER AND NUMBER
12
12
6.08 PROHIBITION AGAINST DIVERSION OF FUNDS 12
6.09 APPROVAL BY INTERNAL REVENUE SERVICE
6.10 TRANSFERS, ROLLOVERS, AND LOANS
6.11 QUALIFIED MILITARY SERVICE
12
12
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ARTICLE I
DEFINITIONS
As used in this Plan Document, the following words and phrases shall have the meanings set forth herein unless
a different meaning is clearly required by the context:
1.01 "Administrator" means person(s) or entity(ies) designated by the Employer pursuant to Article II
to administer the Plan on behalf of the Employer.
1.02 "Anniversary Date" means the first day of each Plan Year.
1.03 "Annuity Contract" means a nontransferable annuity contract (group or individual) issued by the
Insurer. The benefits provided under the Plan shall be funded exclusively by the purchase of Annuity Contracts.
The Employer in its sole discretion shall determine whether group or individual, fixed or variable, or combination
fixed and variable Annuity Contracts shall be purchased under the Plan. The Insurer shall issue a certificate of
participation and/or an individual Annuity Contract to each Participant. Each such certificate of participation or
individual Annuity Contract shall set forth the rights and payout options which such Participant has under the
Annuity Contract.
Unless and until distributed to Participants, each Annuity Contract purchased hereunder shall be
held by the Employer, as owner or group contract holder, and the Employer shall be treated as trustee to the extent
that the Annuity Contracts are treated as trusts pursuant to Section 401(f) of the Code. The Employer shall have
the power and right to take such actions with respect to the Annuity Contracts as shall be consistent with this Plan
and applicable law. Notwithstanding the Employer's status as owner or group contract holder, beneficial
ownership of the Annuity Contracts shall reside in the Participants.
1.04 "Beneficiary means the person or persons the Participant designates to receive benefits under
the Annuity Contract in the event of the Participant's death before all such benefits have been distributed.
1.05 "Code" means the Internal Revenue Code of 1986, as amended.
1.06 "Compensation" with respect to any Participant means such Participant's Compensation paid by
the Employer. Amounts contributed by the Employer under the Plan shall not be considered as Compensation.
Compensation shall include only that Compensation which is actually paid to the Participant during the the portion
of the Plan Year in which the Employee was a Participant in the Plan. The computation period shall be the Plan
Year.
(X) All forms of Compensation shall be counted.
( ) The following forms of Compensation shall not be counted:
Compensation shall include any amount contributed by the Employer pursuant to a salary
reduction agreement which is not includible in the Employee's gross income under Code Sections 125, 402(g), or
403(b), 132(f)(4) or 457 (hereinafter referred to as "Elective Contributions"). Notwithstanding the preceding
sentence, amounts described in § 132(f)(4) are not an amount contributed by the Employer pursuant to a salary
reduction agreement for purposes of this section until Plan Years beginning on or after January 1, 2001, unless
the Plan Administrator operationally has included such amounts effective as of an earlier Plan Year beginning no
earlier than January 1, 1998. Effective for the first Plan Year beginning on or after January 1, 1996, or such later
date as may be prescribed by law or any regulation or ruling issued by the Department of the Treasury, the amount
of Compensation taken into account under this Plan for any purpose for any Employee for any Plan Year shall not
exceed $150,000 (or such greater amount as may be taken into account under Code Section 401(a)(17) and the
regulations thereunder for such Plan Year).
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1.07 "Contribution" shall mean an Employer Contribution or Employee after-tax Contribution, as
provided for under Article IV. All Contributions under the Plan shall be made in cash and shall be allocated to the
individual accounts of the Participants under an Annuity Contract.
1.08 "Eligible Employee" means any Employee who has attained age N/A, who has completed N/A
Years of Service, and who is described as being in one of the classifications below:
All Employees in the following classification(s) shall be eligible for Employer Contributions:
Employees classified as City Manager.
The following Employees shall be excluded from Employer Contributions:
Employees not classified as City Manager.
1.09 "Employee" means any person who is employed by the Employer maintaining this Plan, but shall
not include any person the Employer does not (in good faith) treat as an Employee (including, but not limited to,
independent contractors, persons the Employer pays outside of its payroll system and out -sourced workers) even
if such individuals are later determined by a governmental agency or court to be a common law Employee of
Employer.
1.10 "Employer" shall mean City of McCall, any successor which shall maintain this Plan, and any
predecessor which has maintained this Plan.
1.11 "Hour of Service" shall mean (1) 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; (2) each hour for which an Employee is directly or indirectly
compensated or entitled to Compensation by the Employer (irrespective of whether the employment relationship
has terminated) for reasons other than performance of duties (such as vacation, holidays, sickness, disability,
layoff, military duty, jury duty, or leave of absence) during the applicable computation period; (3) each hour for back
pay awarded or agreed to by the Employer without regard to mitigation of damages. The same Hours of Service
shall not be credited both under (1) or (2), as the case may be, and under (3). These hours will be credited to the
Employee for the computation period or periods to which the award or agreement pertains rather than the
computation period in which the award, agreement or payment is made.
Qualified Military Service — Beginning on December 12, 1994 (or the Effective Date of the Plan, if
later) Hours of Service also includes any Service the Plan must credit in order to satisfy the crediting of service
requirements of Code § 414(u).
1.12 "Insurer" means The Variable Annuity Life Insurance Company (VALIC).
1.13 "Participant" shall mean any Employee or former Employee for whom Contributions have been
made under the Plan and who has a right to receive benefits under an Annuity Contract.
1.14 "Participant's Account Balance" means the balance of the individual account maintained for a
Participant under an Annuity Contract. A Participant's Account Balance shall reflect all Contributions on the
Participant's behalf, all earnings and gains (less any losses) credited under the Annuity Contract, and any charges
imposed under the Annuity Contract. A Participant's Account Balance shall be 100% vested and nonforfeitable at
all times. A Participant's Account Balance shall not include any amount segregated or set aside for payment to an
alternate payee pursuant to a domestic relations order.
1.15 "Plan" shall mean this Plan as adopted by the Employer.
1.16 "Plan Year" is the 12 consecutive month period which begins on January 1 and ends on
December 31. The initial Plan Year shall begin on January 7, 2005 and end on December 31, 2005.
1.17 "Termination" shall mean severance of the Participant's employment with the Employer.
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1.18 "Year of Service" shall mean the computation period of twelve (12) consecutive months, herein
set forth, during which an Employee has at least 1,000 Hours of Service.
(X) Anniversary Switch
For purposes of eligibility and participation, the initial computation period shall begin
with the date on which the Employee first performs an Hour of Service (employment commencement date). The
computation period shall then shift to the Plan Year which includes the anniversary of the employment
commencement date. An Employee who is credited with 1,000 Hours of Service in both the initial eligibility
computation period and the first Plan Year which commences prior to the first anniversary of the Employee's initial
eligibility computation period will be credited with two Years of Service for purposes of eligibility to participate.
( ) Plan Year
based on the Plan Year.
For purposes of eligibility and participation, the computation period will be measured
( ) Employment Anniversaries
For purposes of eligibility and participation, the computation period will be measured
based on the 12-month period beginning with an Employee's employment commencement date and each
anniversary.
Recommencement of Employment: If a former Employee recommences his employment with
the Employer, Years of Service will be determined in the same manner as described above based on his
reemployment commencement date. An Employee's Years of Service before a Termination shall be taken into
account in determining his eligibility for participation after reemployment.
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ARTICLE II
ADMINISTRATION
2.01 APPOINTMENT OF ADMINISTRATOR
Any person, including but not limited to, the Employer or any Employees of the Employer, shall be eligible
to serve as Administrator. The Employer shall have the right at any time to name a new Administrator or to replace
one or more of the persons who are collectively serving as Administrators.
2.02 DUTIES OF ADMINISTRATOR
The Administrator shall serve as the Employer's agent in the administration of the Plan. The primary
responsibility of the Administrator is to assure that the Plan is administered in accordance with its terms for the
exclusive benefit of Participants and Beneficiaries. The Employer or Administrator shall maintain all records and
prepare all reports that are necessary to carry out the terms of the Plan or that are legally required, other than those
properly maintained or furnished by the Insurer under the Annuity Contracts.
2.03 POWERS OF ADMINISTRATOR
Benefits under this plan will be paid only if the Administrator decides, in the Administrator's sole
discretion, that the applicant is entitled to them.
2.04 INFORMATION FROM EMPLOYER
The Employer or Administrator shall supply full and timely information to the Insurer on all matters relating
to the Compensation of all Participants, their Hours of Service, their Years of Service, their retirement, death,
disability, or Termination, and such other pertinent facts as the Insurer may require. The Insurer shall be protected
and held harmless in acting in reliance on any information furnished to the Insurer by the Employer or
Administrator or in acting in accordance with any written direction of the Employer or Administrator. The Insurer
shall have no obligation to question any actions directed by the Employer or Administrator.
2.05 EMPLOYER'S AND ADMINISTRATOR'S PROTECTIVE CLAUSE
Neither the Employer nor the Administrator, nor their successors, shall be responsible for the validity of
any Annuity Contract purchased hereunder, for the failure on the part of the Insurer to pay benefits under any such
Annuity Contract, or for the action of any person which may delay payment of benefits under any such Annuity
Contract.
2.06 PAYMENT OF EXPENSES
Any expenses incurred in the administration of the Plan, other than expenses incurred by the Insurer, shall
be paid by the Employer.
2.07 CLAIMS PROCEDURE
Claims for benefits under the Plan shall be filed with the Insurer pursuant to the terms of the Annuity
Contracts.
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2.08 FORM OF NOTICES
All notices under the Plan and all Participant or Beneficiary designations, elections, consents or waivers
must be in writing and made in the form the Plan Administrator specifies or otherwise approves. To the extent
permitted by Treasury Regulations or other applicable guidance, any Plan notice, election, consent or waiver may
be transmitted electronically. Any person entitled to notice under the Plan may waive the notice or shorten the
notice period except as otherwise required by the Code.
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ARTICLE III
ELIGIBILITY
3.01 CONDITIONS OF ELIGIBILITY
Any Eligible Employee who has satisfied the requirements specified in Section 1.08 shall participate
hereunder on the date specified in Section 3.02. Participation shall be automatic and no application for
participation shall be required. The Employee shall complete any forms required by the Insurer or Administrator
prior to the date of commencement of participation.
3.02 EFFECTIVE DATE OF PARTICIPATION
An Employee who has become eligible to be a Participant shall become a Participant effective as of the
date of employment.
In the event an Eligible Employee who has otherwise satisfied the Plan's eligibility requirements shall go
from a classification of a non -eligible Employee to an Eligible Employee, such Employee shall become a
Participant as of the date he became an Eligible Employee.
In the event a Participant shall go from a classification of an Eligible Employee to a non -eligible
Employee, such employee shall no longer be eligible for Contributions as of that date.
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ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.01 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION
The formula for determining the Employer's Contribution for this Plan is checked below. Only the
selected formula applies. Other formulas may be disregarded.
( ) A. Money Purchase
(1) On behalf of each Participant, for each year of his participation in this Plan in which the
Participant satisfies the requirements of paragraph (2), if any, the Employer shall
contribute
(2) In order to receive a Contribution for a given Plan Year, the Participant must:
(X) B. Profit -Sharing
(1) (X) The Employer, in its sole discretion, shall determine the amount of the profit-
sharing Contribution, if any, to be made to the Plan each Plan Year. Such
Contribution shall be allocated among the individual accounts of Participants
who satisfy the requirements of paragraph (2), if any, such that the allocated
Contribution equals a uniform percentage of the Compensation of each
Participant who is eligible for a Contribution.
O
The Employer, in its sole discretion, may contribute a flat dollar amount or
percentage of Compensation to the individual accounts of Participants who
satisfy the requirement of paragraph (2), if any. Such Contribution may vary by
each eligible class and/or employee, and shall be determined by the Employer
each year.
(2) In order to receive a Contribution for a given Plan Year, the Participant must:
N/A.
( ) C. Matching
(1) On behalf of each Participant, for each year of his participation in this Plan in which the
Participant satisfies the requirements of paragraph (2), if any, the Employer shall
contribute $ for each $1 of the Participant's Employee
The Participant's Employee in excess of shall not be taken into account
for purposes of this Employer matching Contribution.
(2) In order to receive a Contribution for a given Plan Year, the Participant must:
•
4.02 TIME OF PAYMENT OF EMPLOYER'S CONTRIBUTION
The Employer shall pay to the Insurer its Contribution to the Plan for each Plan Year within the time
prescribed by law.
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4.03 LIMITATION ON CONTRIBUTIONS
Notwithstanding any other provision of the Plan, no Employer Contributions shall be made that would
exceed the limitation on annual additions under Section 415 of the Code, and that limitation is incorporated herein
by reference. For purposes of this paragraph, compensation shall be the "Participant's Compensation," as
defined in Code Section 415(c)(3), as amended from time to time, and the applicable regulations thereunder.
Notwithstanding the requirement of Section 415(c)(3)(D) that "Participant's Compensation" include amounts
described in Code Section 132(f)(4), compensation for purposes of this paragraph shall not include such amounts
until Plan Years beginning on or after January 1, 2001, unless the Plan Administrator has operationally included
such amounts effective as of an earlier Plan Year beginning no earlier than January 1, 1998. If the Section 415
limits would otherwise be exceeded, any Employer Contributions for the Participant shall be reduced (in a
practicable and proportional manner to be determined by the Administrator) until all Contributions are within the
relevant limitations. For purposes of this section, the "limitation year" for any participant shall be the Plan Year.
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ARTICLE V
DISTRIBUTION OF BENEFITS
5.01 DISTRIBUTION OF BENEFITS UPON TERMINATION
Upon a Participant's Termination, all amounts credited to such Participant's Account Balance tall
become distributable in accordance with the payout options in the Annuity Contract.
5.02 DISTRIBUTION OF BENEFITS IN EVENT OF DISABILITY - FOR PROFIT SHARING PLAN (IF APPLICABLE)
In the event that the Participant is absent from work by reason of long-term disability, but has not had a
termination, all amounts credited to such Participant's Account Balance shall become distributable. For purposes
of this Section 5.02, long-term disability means the inability to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment that can be expected to result in death or which has
lasted or can be expected to last for a continuous period of not less than 12 months. The permanence and degree
of such impairment shall be supported by medical evidence. The determination shall be applied uniformly to all
Participants.
5.03 FORM AND TIMING OF DISTRIBUTIONS
As permitted under the terms of the Annuity Contract, the Participant shall select a payout option and
benefit commencement date, provided that:
(a) The participant must commence receiving distribution of benefits no later than April 1st of the
calendar year following the year in which the Participant attains age 70-1/2 or retires, whichever is later.
(b) No payout option shall be permitted that fails to provide for the Participant or any Beneficiary to
receive for each calendar year at least the amounts required to be distributed in accordance with Section 401(a)(9)
of the Code.
(c) For purposes of applying Section 401(a)(9) to a participant or Beneficiary, a single life expectancy
shall be recalculated and a joint life expectancy shall not be recalculated, unless the Participant or Beneficiary
elects otherwise.
5.04 DISTRIBUTION OF BENEFITS UPON DEATH
(a) If a Participant dies before the commencement of distribution under the Annuity Contract, the
Participant's Account Balance must be (i) fully distributed by the end of the fifth calendar year following the calendar
year of the Participant's death, or (ii) applied to provide an annuity for the Beneficiary commencing no later than the
end of the calendar year following the calendar year of the Participant's death (or such later time as permitted
under Code Section 401(a)(9)).
(b) If a Participant dies after the commencement of distributions, the Participant's remaining interest,
if any, under the Annuity Contract shall be distributed according to the terms of the payout option then in effect and
in no event less rapidly than under such payout option.
(c) The provisions of Section 5.03 and this Section 5.04 are to be interpreted and applied in
accordance with the requirements of Code Section 401(a)(9), which are incorporated herein by reference.
5.05 REQUIRED MINIMUM DISTRIBUTIONS
Nothing in this section shall be construed as making available any benefit or form or time of distribution
not otherwise available under an Annuity Contract.
9
With respect to distributions made for calendar years beginning on or after January 7, 2005,
notwithstanding any provision of the Plan to the contrary, no Payout Option shall be permitted that fails to provide
for the Participant or any Beneficiary to receive for each calendar year at least the amounts required to be
distributed under Section 401(a)(9) of the Code, as determined in accordance with the regulations under Section
401(a)(9) that were proposed on January 17, 2001. This amendment shall continue in effect until the end of the
last calendar year beginning before the effective date of final regulations under Section 401(a)(9) or such other
date as may be specified in guidance published by the Internal Revenue Service.
5.06 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN
In the event that all, or any portion, of the distribution payable to a Participant or his Beneficiary hereunder
shall, at the expiration of three (3) years after it shall become payable, remain unpaid solely by reason of the
inability of the Administrator, after sending a registered letter, return receipt requested, to the last known address,
to locate said individual(s), the amount so distributable shall revert to the Employer. In the event a Participant or
Beneficiary is located subsequent to his benefit being reallocated, such benefit shall be restored.
5.07 DIRECT ROLLOVERS
(a) Direct Rollovers: This section applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of the plan to the contrary that would otherwise limit a distributee's election under
this section, a distributee may elect, at the time and in the manner prescribed by the Plan Administrator, to have
any portion of an eligible rollover distribution paid directly to an eligible retirement plan specified by the distributee
in a direct rollover.
(b) Definitions:
(1) Eligible Rollover Distribution: An eligible rollover distribution is any distribution of all or
any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not
include: any distribution that is one of a series of substantially equal periodic payments (not less frequently than
annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the
distributee and the distributee's designated beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under Section 401(a)(9) of the Code; any hardship
distribution described in Section 401(k)(2)(B)(1)(IV) of the Code made after December 31, 1998; and the portion of
any distribution that is not includible in gross income (determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
(2) Eligible Retirement Plan: An eligible retirement plan is an individual retirement account
described in Section 408(a) of the Code, an individual retirement annuity described in Section 408(b) of the Code,
an annuity plan described in Section 403(a) of the Code, or a qualified trust described in Section 401(a) of the
Code, that accepts the distributee's eligible rollover distribution. However, in the case of an eligible rollover
distribution to the surviving spouse, an eligible retirement plan is an individual retirement account or individual
retirement annuity.
(3) Distributee: A distributee includes an Employee or former Employee. In addition, the
Employee's or former Employee's surviving spouse and the Employee's or former Employee's spouse or former
spouse who is the alternate payee under a domestic relations order, as defined in Section 414(p) of the Code, are
distributees with regard to the interest of the spouse or former spouse.
(4) Direct Rollover. A direct rollover is a payment by the Plan to the eligible retirement plan
specified by the distributee.
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ARTICLE VI
MISCELLANEOUS
6.01 PLAN AMENDMENT
The Employer shall have the right to amend the Plan at any time, provided that no amendment which
affects the rights, duties, or responsibilities of the Insurer shall become effective without the Insurer's written
consent, and provided further, that no amendment shall be inconsistent with the requirements of Section 6.08 or
otherwise cause any reduction in Participants' Account Balances or their vested interests therein.
6.02 PLAN TERMINATION
The Employer shall have the right at any time to terminate the Plan by delivering to the Insurer and
Administrator written notice of such termination. In the event of such termination, the Employer may direct that
Participants' Account Balances under the Annuity Contracts then become distributable or that Participants' Account
Balances under any group Annuity Contract then be transferred to individual Annuity Contracts, or the Employer
may take such other action with respect to Participants' Account Balances as is consistent with the purposes of
this Plan and the terms of the Annuity Contracts and the Insurer's obligations thereunder.
A complete discontinuance of the Employer's Contributions to a Profit -Sharing Plan shall be deemed to
constitute a termination.
6.03 PARTICIPANTS RIGHTS
This Plan shall not be deemed to constitute a contract between the Employer and any Participant or to be
a consideration or an inducement for the employment of any Participant or Employee. Nothing contained in this
Plan shall be deemed to give any Participant or Employee the right to be retained in the service of the Employer or
to interfere with the right of the Employer to discharge any Participant or Employee at any time regardless of the
effect which such discharge shall have upon him as a Participant of this Plan.
6.04 ALIENATION
No benefit which shall be payable under the Plan to any person (including a Participant or his Beneficiary)
shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or
charge, and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, or charge the same shall
be void; and no such benefit shall in any manner be liable for or subject to the debts, contracts, liabilities,
engagements, or torts of any such person, or be subject to attachment or legal process for or against such person
except as allowed under Section 401(a)(13) of the Code.
6.05 DOMESTIC RELATIONS ORDERS
Notwithstanding the foregoing, all rights and benefits provided to a Participant in this Plan shall be subject
to the rights afforded to any "alternate payee" under a " domestic relations order" as those terms are defined in
Code Section 414(p).
No benefits shall be paid to an alternate payee until the Administrator or the Insurer has established that
such order is a domestic relations order. Reasonable written procedures shall be established to determine the
status of domestic relations orders and to administer distributions pursuant to domestic relations orders. Benefits
awarded to the Alternate Payee may be paid within a reasonable time after the order is determined to be a
Domestic Relations Order, notwithstanding the fact that the Participant has not attained his or her "earliest
retirement age," as defined in Section 414(p) of the Code.
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6.06 CONSTRUCTION OF PLAN
This Plan is intended to satisfy all applicable requirements under Code Section 401(a) and is to be
construed and enforced in accordance with such requirements, and the laws of the State or Commonwealth in
which this Plan was executed, other than its laws respecting choice of law.
6.07 GENDER AND NUMBER
Wherever any words are used herein in the masculine, feminine, or neuter gender, they shall be
construed as though they were also used in another gender in all cases where they would so apply, and whenever
any words are used herein in the singular or plural form, they shall be construed as though they were also used in
the other form in all cases where they would so apply.
6.08 PROHIBITION AGAINST DIVERSION OF FUNDS
Except as provided in Section 5.06, it shall be impossible by operation of the Plan or any Annuity Contracts
purchased hereunder, by termination of either, by power of revocation or amendment, by the happening of any
contingency, by collateral arrangement or by any other means, for any amount held under an Annuity Contract or
any funds contributed thereto to be used for, or diverted to, purposes other than the exclusive benefit of Participants
or their Beneficiaries. Notwithstanding the foregoing, in the event the Employer makes a Contribution hereunder,
by reason of a mistake of fact, such Contribution may be returned to the Employer within one year from the date of
the mistaken Contribution.
6.09 APPROVAL BY INTERNAL REVENUE SERVICE
(a) The Employer may cause an application to be filed by or on behalf of the Plan with the Internal
Revenue Service requesting a determination letter that the Plan as adopted or amended by the Employer qualifies
as a tax-exempt plan under Sections 401 and 501 of the Code.
(b) Notwithstanding anything herein to the contrary, if such application is made by the last day of the
Plan Year in which the Plan is adopted, and if the Commissioner of the Internal Revenue Service or his delegate
should determine that the Plan does not initially qualify as a tax-exempt plan under Sections 401 and 501 of the
Code, and such determination is not contested, or if contested, is finally upheld, any Contribution made incident to
that initial qualification by the Employer must be returned to the Employer within one year after the date the initial
qualification is denied.
6.10 TRANSFERS, ROLLOVERS, AND LOANS
No transfers or rollovers shall be accepted under the Plan, and no loans to Participants shall be available
under the Plan.
6.11 QUALIFIED MILITARY SERVICE
Notwithstanding any provisions of this plan to the contrary, contributions, benefits and service credit with
respect to qualified military service will be provided in accordance with section 414(u) of the Internal Revenue
Code.
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This is a new Plan and the Effective Date is January 7.2005.
This is a restatement of an original plan which was effective _. The Effective Date of this restatement is
has caused this instrument
to be executed by its duly authorized officers on this ___ 3 _ day of 315.th. l l , 2005
effective as of the date set forth therein. lT
IN WITNESS WHEREOF, __219E.4Qt 71S
Witness
(Print Name)
CITY OF MCCALL
13
By
�r2 f✓. t.IntA i.D lS
(Print Name)
Title PCQ—SONX E. l.. 0 1C��12
AMENDMENT
TO THE
CITY OF MCCALL
EXCLUSIVE BENEFIT GOVERNMENTAL
401(A) NONTRUSTEED RETIREMENT PLAN
The plan is hereby amended to include the following:
MINIMUM DISTRIBUTION REQUIREMENTS.
Section 1. General Rules
1.1. Effective Date. The provisions of this article will apply for purposes of determining required
minimum distributions for calendar years beginning with the 2003 calendar year.
1.2. Precedence. The requirements of this article will take precedence over any inconsistent
provisions of the plan.
1.3. Requirements of Treasury Regulations Incorporated. All distributions required under this
article will be determined and made in accordance with the Treasury regulations under section 401(a)(9)
of the Internal Revenue Code.
1.4. TEFRA Section 242(b)(2) Elections. Notwithstanding the other provisions of this article,
distributions may be made under a designation made before January 1, 1984, in accordance with section
242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA) and the provisions of the plan that
relate to section 242(b)(2) of TEFRA.
Section 2. Time and Manner of Distribution.
2.1. Required Beginning Date. The participant's entire interest will be distributed, or begin to be
distributed, to the participant no later than the participant's required beginning date.
2.2. Death of Participant Before Distributions Begin. If the participant dies before distributions
begin, the participant's entire interest will be distributed, or begin to be distributed, no later than as
follows:
(a) If the participant's surviving spouse is the participant's sole designated beneficiary, then,
except as provided in the plan, distributions to the surviving spouse will begin by December 31 of
the calendar year immediately following the calendar year in which the participant died, or by
December 31 of the calendar year in which the participant would have attained age 70 1/2, if
later.
(b) If the participant's surviving spouse is not the participant's sole designated beneficiary, then,
except as provided in the plan, distributions to the designated beneficiary will begin by December
31 of the calendar year immediately following the calendar year in which the participant died.
(c) If there is no designated beneficiary as of September 30 of the year following the year of the
participant's death, the participant's entire interest will be distributed by December 31 of the
calendar year containing the fifth anniversary of the participant's death.
(d) If the participant's surviving spouse is the participant's sole designated beneficiary and the
surviving spouse dies after the participant but before distributions to the surviving spouse begin,
this section 2.2, other than section 2.2(a), will apply as if the surviving spouse were the
participant.
For purposes of this section 2.2 and section 4, unless section 2.2(d) applies, distributions are
considered to begin on the participant's required beginning date. If section 2.2(d) applies, distributions are
considered to begin on the date distributions are required to begin to the surviving spouse under section
2.2(a). If distributions under an annuity purchased from an insurance company irrevocably commence to
the participant before the participant's required beginning date (or to the participant's surviving spouse
before the date distributions are required to begin to the surviving spouse under section 2.2(a)), the date
distributions are considered to begin is the date distributions actually commence.
2.3. Forms of Distribution. Unless the participant's interest is distributed in the form of an annuity
purchased from an insurance company or in a single sum on or before the required beginning date, as of
the first distribution calendar year distributions will be made in accordance with sections 3 and 4 of this
article. If the participant's interest is distributed in the form of an annuity purchased from an insurance
company, distributions thereunder will be made in accordance with the requirements of section 401(a)(9)
of the Code and the Treasury regulations.
Section 3. Required Minimum Distributions During Participant's Lifetime.
3.1. Amount of Required Minimum Distribution For Each Distribution Calendar Year. During the
participant's lifetime, the minimum amount that will be distributed for each distribution calendar year is the
lesser of:
(a) the quotient obtained by dividing the participant's account balance by the distribution period in
the Uniform Lifetime Table set forth in section 1.401(a)(9)-9 of the Treasury regulations, using the
participant's age as of the participant's birthday in the distribution calendar year; or
(b) if the participant's sole designated beneficiary for the distribution calendar year is the
participant's spouse, the quotient obtained by dividing the participant's account balance by the
number in the Joint and Last Survivor Table set forth in section 1.401(a)(9)-9 of the Treasury
regulations, using the participant's and spouse's attained ages as of the participant's and
spouse's birthdays in the distribution calendar year.
3.2. Lifetime Required Minimum Distributions Continue Through Year of Participant's Death.
Required minimum distributions will be determined under this section 3 beginning with the first distribution
calendar year and up to and including the distribution calendar year that includes the participant's date of
death.
Section 4. Required Minimum Distributions After Participant's Death.
4.1. Death On or After Date Distributions Begin.
(a) Participant Survived by Designated Beneficiary. If the participant dies on or after the date
distributions begin and there is a designated beneficiary, the minimum amount that will be
distributed for each distribution calendar year after the year of the participant's death is the
quotient obtained by dividing the participant's account balance by the longer of the remaining life
expectancy of the participant or the remaining life expectancy of the participant's designated
beneficiary, determined as follows:
(1) The participant's remaining life expectancy is calculated using the age of the
participant in the year of death, reduced by one for each subsequent year.
(2) If the participant's surviving spouse is the participant's sole designated beneficiary,
the remaining life expectancy of the surviving spouse is calculated for each distribution calendar
year after the year of the participant's death using the surviving spouse's age as of the spouse's
birthday in that year. For distribution calendar years after the year of the surviving spouse's
death, the remaining life expectancy of the surviving spouse is calculated using the age of the
surviving spouse as of the spouse's birthday in the calendar year of the spouse's death, reduced
by one for each subsequent calendar year.
(3) If the participant's surviving spouse is not the participant's sole designated
beneficiary, the designated beneficiary's remaining life expectancy is calculated using the age of
the beneficiary in the year following the year of the participant's death, reduced by one for each
subsequent year.
(b) No Designated Beneficiary. If the participant dies on or after the date distributions begin and
there is no designated beneficiary as of September 30 of the year after the year of the
participant's death, the minimum amount that will be distributed for each distribution calendar
year after the year of the participant's death is the quotient obtained by dividing the participant's
account balance by the participant's remaining life expectancy calculated using the age of the
participant in the year of death, reduced by one for each subsequent year.
4.2. Death Before Date Distributions Begin.
(a) Participant Survived by Designated Beneficiary. Except as provided in the plan, if the
participant dies before the date distributions begin and there is a designated beneficiary, the
minimum amount that will be distributed for each distribution calendar year after the year of the
participant's death is the quotient obtained by dividing the participant's account balance by the
remaining life expectancy of the participant's designated beneficiary, determined as provided in
section 4.1.
(b) No Designated Beneficiary. If the participant dies before the date distributions begin and there
is no designated beneficiary as of September 30 of the year following the year of the participant's
death, distribution of the participant's entire interest will be completed by December 31 of the
calendar year containing the fifth anniversary of the participant's death.
(c) Death of Surviving Spouse Before Distributions to Surviving Spouse Are Required to Begin. If
the participant dies before the date distributions begin, the participant's surviving spouse is the
participant's sole designated beneficiary, and the surviving spouse dies before distributions are
required to begin to the surviving spouse under section 2.2(a), this section 4.2 will apply as if the
surviving spouse were the participant.
Section 5. Definitions.
5.1. Designated beneficiary. The individual who is designated as the beneficiary under section
6.02 of the plan and is the designated beneficiary under section 401(a)(9) of the Internal Revenue Code
and section 1.401(a)(9)-1, Q&A-4, of the Treasury regulations.
5.2. Distribution calendar year. A calendar year for which a minimum distribution is required. For
distributions beginning before the participant's death, the first distribution calendar year is the calendar
year immediately preceding the calendar year which contains the participant's required beginning date.
For distributions beginning after the participant's death, the first distribution calendar year is the calendar
year in which distributions are required to begin under section 2.2. The required minimum distribution for
the participant's first distribution calendar year will be made on or before the participant's required
beginning date. The required minimum distribution for other distribution calendar years, including the
required minimum distribution for the distribution calendar year in which the participant's required
beginning date occurs, will be made on or before December 31 of that distribution calendar year.
5.3. Life expectancy. Life expectancy as computed by use of the Single Life Table in section
1.401(a)(9)-9 of the Treasury regulations.
5.4. Participant's account balance. The account balance as of the last valuation date in the
calendar year immediately preceding the distribution calendar year (valuation calendar year) increased by
the amount of any contributions made and allocated or forfeitures allocated to the account balance as of
dates in the valuation calendar year after the valuation date and decreased by distributions made in the
valuation calendar year after the valuation date. The account balance for the valuation calendar year
includes any amounts rolled over or transferred to the plan either in the valuation calendar year or in the
distribution calendar year if distributed or transferred in the valuation calendar year.
5.5 Required beginning date. The date specified in the required distribution section of the plan.
Section 6. Election to Allow Participants or Beneficiaries to Elect 5-Year Rule.
Notwithstanding any language in this article to the contrary, participants or beneficiaries may elect
on an individual basis whether the 5-year rule or the life expectancy rule in sections 2.2 and 4.2 of Article
XIII of the plan applies to distributions after the death of a participant who has a designated beneficiary.
The election must be made no later than the earlier of September 30 of the calendar year in which
distribution would be required to begin under section 2.2 of Article XIII of the plan, or by September 30 of
the calendar year which contains the fifth anniversary of the participant's (or, if applicable, surviving
spouse's) death. If neither the participant nor beneficiary makes an election under this paragraph,
distributions will be made in accordance with sections 2.2 and 4.2 of this amendment.
Section 7. Election to Allow Designated Beneficiary Receiving Distributions Under 5-Year Rule to Elect
Life Expectancy Distributions.
Notwithstanding any language in this article to the contrary, a designated beneficiary who is
receiving payments under the 5-year rule may make a new election to receive payments under the life
expectancy rule until December 31, 2003, provided that all amounts that would have been required to be
distributed under the life expectancy rule for all distribution calendar years before 2004 are distributed by
the earlier of December 31, 2003 or the end of the 5-year period.
This amendment has been executed this 3 day of J pbJu12,0--I , 20 0% .
Name of Employer: City of McCall
By:
Name: V:,2sz,4 DPP
(Print)
Title: Res.--4A 0Gc•►G
EGTRRA
AMENDMENT TO THE
CITY OF MCCALL
EXCLUSIVE BENEFIT GOVERNMENTAL 401(A) NONTRUSTEED RETIREMENT PLAN
1.1
ARTICLE 1
PREAMBLE
Adoption and effective date of amendment This amendment of the Plan is adopted to reflect certain
provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA"). This amendment
is intended as good faith compliance with the requirements of EGTRRA and is to be construed in
accordance with EGTRRA and guidance issued thereunder. Except as otherwise provided, this amendment
shall be effective as of the first day of the first Plan Year beginning after December 31, 2001.
1.2 Supersession of inconsistent provisions . This amendment shall supersede the provisions of the Plan to the
extent those provisions are inconsistent with the provisions of this amendment.
ARTICLE II
ADOPTION AGREEMENT ELECTIONS
2.1 Vesting schedule for Matching Contributions. If there are Matching Contributions subject to a vesting
schedule that does not satisfy EGTRRA, then unless otherwise elected below, for Participants who complete
an Hour of Service in a Plan Year beginning after December 31, 2001, the following vesting schedule will
apply to all Matching Contributions subject to a vesting schedule:
If the Plan has a graded vesting schedule (Le., the vesting schedule includes a vested percentage
that is more than 0% and less than 100%), the following will apply:
Years of vesting service Nonforfeitable percentage
2 20%
3 40%
4 60%
5 80%
6 100%
If the Plan does not have a graded vesting schedule, then Matching Contributions will be nonforfeitable upon
the completion of 3 years of vesting service.
In lieu of the above vesting schedule, the Employer elects the following schedule:
a. [ ] 3-year cliff (a Participant's accrued benefit derived from Employer Matching Contributions
shall be nonforfeitable upon the Participant's completion of three years of vesting
service).
b. [ ] 6-year graded schedule (20% after 2 years of vesting service and an additional 20% for
each year thereafter).
c. [ ] Other (must be at least as liberal as a. or b. above):
Years of vesting service Nonforfeitable percentage
d. [X] N/A — This option is not applicable due to the following:
[ ] This plan does not include Matching Contributions.
[X] Plan sponsor is a Governmental Employer and therefore not subject to minimum
vesting requirements.
[ ] Current vesting schedule is at least as favorable as a or b above.
El Matching Contributions are in a SIMPLE/Safe Harbor plan which requires 100%
immediate vesting.
The vesting schedule set forth herein shall only apply to Participants who complete an Hour of Service in a
Plan Year beginning after December 31, 2001, and shall apply to all Matching Contributions subject to a
vesting schedule.
2.2 Suspension period of hardship distributions. If the Plan provides for hardship distributions upon
satisfaction of the safe harbor (deemed) standards as set forth in Treasury Regulation Section 1.401(k)-
1(d)(2)(iv), then
[]
With regard to hardship distributions made during 2001, a Participant shall be prohibited from
making Elective Deferrals and Employee Contributions under this and all other plans until the later
of January 1, 2002, or 6 months after receipt of the distribution.
(Choose only one from below.)
[]
Effective January 1, 2002, a Participant shall be prohibited from making Elective Deferrals and
Employee Contributions under this and all other plans until 6 months after receipt of the distribution.
[ ] Effective 20 (insert date after December 31, 2001), a Participant shall
be prohibited from making Elective Deferrals and Employee Contributions under this and all other
plans until 6 months after receipt of the distribution. (Please Note: If you choose this option, your
Plan will not be exempt from ADP and ACP testing as a safe harbor 401(k) Plan for the period
January 1, 2002 through the effective date chosen.)
[X] N/A — Either hardship distributions are not allowed or the Employer shall maintain the current 12
month suspension period in this plan.
2.3 Catch-up Contributions (for 401(k) profit sharing plans only):
[ ] The Plan permits Catch-up Contributions (Article V), effective 20
(insert date after December 31, 2001). Please Note: If the Employer sponsors more than one plan
with Elective Deferrals (e.g., 401(k), 403(b), 457(b)), then if one plan permits Catch-up
Contributions, all plans must permit Catch-up Contributions. For this purpose, the term "Employer"
means all members of a controlled group.
[X] The Plan does not permit Catch-up Contributions to be made.
2.4 Elective Deferrals. If an option below is elected, then Elective Deferrals shall be allowed to the extent
specified.
[ ] Effective 20 (insert date on or after January 1, 2002), each
Employee may elect to have Compensation reduced by the maximum percentage allowable under
Code Sections 401(k), 402(g), 404 (if applicable) and 415.
[ ] Effective 20 (insert date not earlier than the first day of the first
Plan Year after December 31, 2001), each Employee may elect to have Compensation reduced by
a maximum of ____% of Compensation.
[X] N/A —There are no Elective Deferrals in this plan.
2.5 Rollovers from other plans. Notwithstanding any election to the contrary in the Adoption Agreement,
transfers and rollovers from other plans (Article XI of this amendment) will be allowed:
[ ] Yes, for Participants only.
[X] Yes, for all Employees.
[ ] No.
If rollovers are allowed, distributions of rollovers may be made at any time if there is no distributable event
which permits a distribution of other accounts.
[X] Yes.
[ ] No.
2.6 Distribution upon severance of employment. Distribution upon severance of employment (Section 15.2)
shall apply for distributions after January 7, 2005 (insert date no earlier than December 31, 2001),
(Choose one.)
[X] regardless of when the severance of employment occurred.
[]
[]
for severances of employment occurring after
N/A — No change to current plan distribution restrictions.
ARTICLE III
VESTING OF MATCHING CONTRIBUTIONS
(insert date).
3.1 Applicability. This Article shall apply to Participants who complete an Hour of Service after December 31,
2001, with respect to accrued benefits derived from Employer Matching Contributions made in Plan Years
beginning after December 31, 2001. This Article shall also apply to all such Participants with respect to
accrued benefits derived from Employer Matching Contributions made in Plan Years beginning prior to
January 1, 2002.
3.2 Vesting schedule. A Participant's accrued benefit derived from Employer Matching Contributions shall vest
as provided in Section 2.1 of this amendment.
ARTICLE IV
HARDSHIP DISTRIBUTIONS
4.1 Applicability and effective date. If the Plan provides for hardship distributions upon satisfaction of the safe
harbor (deemed) standards as set forth in Treasury Regulation Section 1.401 (k)-1(d)(2)(iv), then this Article
shall apply for calendar years beginning after 2001.
4.2 Suspension period following hardship distribution. If elected by the Employer in Section 2.2 of this
amendment, a Participant who receives a distribution of Elective Deferrals after December 31, 2001, on
account of hardship shall be prohibited from making Elective Deferrals and Employee Contributions under
this and all other plans of the Employer for 6 months after receipt of the distribution. Furthermore, if elected
by the Employer in Section 2.2 of this amendment, a Participant who receives a distribution of Elective
Deferrals in calendar year 2001 on account of hardship shall be prohibited from making Elective Deferrals
and Employee Contributions under this and all other plans until the later of January 1, 2002, or 6 months
after receipt of the distribution.
ARTICLE V
CATCH-UP CONTRIBUTIONS
Catch-up Contributions . If elected in Section 2.3 of this amendment, all Employees who are eligible to make Elective
Deferrals under this Plan and who have attained age 50 (or will attain age 50 before the close of the calendar year)
shall be eligible to make Catch-up Contributions in accordance with, and subject to the limitations of, Section 414(v)
of the Code. Such Catch-up Contributions shall not be taken into account for purposes of the provisions of the Plan
implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall not be treated as failing
to satisfy the provisions of the Plan implementing the requirements of Section 401(k)(3), 401(k)(11), 401(k)(12),
410(b), or 416 of the Code, as applicable, by reason of the making of such Catch-up Contributions.
ARTICLE VI
INCREASE IN COMPENSATION LIMIT
Increase in Compensation Limit The annual Compensation of each Participant taken into account in determining
allocations for any Plan Year beginning after December 31, 2001, shall not exceed $200,000, as adjusted for cost -of -
living increases in accordance with Section 401(a)(17)(B) of the Code. Annual Compensation means Compensation
during the Plan Year or such other consecutive 12-month period over which Compensation is otherwise determined
under the Plan (the determination period). If this is a target benefit plan, then for purposes of determining benefit
accruals in a Plan Year beginning after December 31, 2001, Compensation for any prior determination period shall be
limited to $200,000. The cost -of -living adjustment in effect for a calendar year applies to annual Compensation for the
determination period that begins with or within such calendar year.
ARTICLE VII
PLAN LOANS
Plan loans for owner -employees or shareholder -employees . If the Plan permits loans to be made to Participants, then
effective for Plan loans made after December 31, 2001, Plan provisions prohibiting loans to any owner -employee or
shareholder -employee shall cease to apply.
ARTICLE VIII
LIMITATIONS ON CONTRIBUTIONS (IRC-SECTION 415 LIMITS)
8.1 Effective date. This Section shall be effective for limitation years beginning after December 31, 2001.
8.2 Maximum Annual Addition. Except to the extent permitted under Article V of this amendment and Section
414(v) of the Code, if applicable, the Annual Addition that may be contributed or allocated to a Participant's
account under the Plan for any limitation year shall not exceed the lesser of:
a. $40,000, as adjusted for increases in the cost -of -living under Section 415(d) of the Code, or
b. 100 percent of the Participant's Compensation, within the meaning of Section 415(c)(3) of the
Code, for the limitation year.
The Compensation limit referred to in b. shall not apply to any contribution for medical benefits after
separation from service (within the meaning of Section 401(h) or Section 419A(f)(2) of the Code) which is
otherwise treated as an Annual Addition.
ARTICLE IX
MODIFICATION OF TOP HEAVY RULES
9.1 Effective date. This Article shall apply for purposes of determining whether the Plan is a Top Heavy Plan
under Section 416(g) of the Code for Plan Years beginning after December 31, 2001, and whether the Plan
satisfies the minimum benefits requirements of Section 416(c) of the Code for such years. This Article
amends all of the Top Heavy provisions of the Plan.
9.2 Determination of Top Heavy status.
9.2.1 Kev Employee. Key Employee means any Employee or former Employee (including any deceased
employee) who at any time during the Plan Year that includes the determination date was an officer
of the Employer having annual Compensation greater than $130,000 (as adjusted under Section
416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a 5-percent owner of the
Employer, or a 1-percent owner of the Employer having annual Compensation of more than
$150,000. For this purpose, annual Compensation means Compensation within the meaning of
Section 415(c)(3) of the Code. The determination of who is a Key Employee will be made in
accordance with Section 416(i)(1) of the Code and the applicable regulations and other guidance of
general applicability issued thereunder.
9.2.2 Determination of present values and amounts. This Section 9.2.2 shall apply for purposes of
determining the present values of accrued benefits and the amounts of account balances of
employees as of the determination date.
a. Distributions during year ending on the determination date. The present values of accrued
benefits and the amounts of account balances of an employee as of the determination
date shall be increased by the distributions made with respect to the employee under the
Plan and any plan aggregated with the Plan under Section 416(g)(2) of the Code during
the 1-year period ending on the determination date. The preceding sentence shall also
apply to distributions under a terminated plan which, had it not been terminated, would
have been aggregated with the Plan under Section 416(g)(2)(A)(i) of the Code. In the case
of a distribution made for a reason other than separation from service, death, or disability,
this provision shall be applied by substituting "5-year period" for "1-year period."
b. Employees not performing services during year ending on the determination date. The
accrued benefits and accounts of any individual who has not performed services for the
Employer during the 1-year period ending on the determination date shall not be taken
into account.
9.3 Minimum benefits.
9.3.1 Matching Contributions . Employer Matching Contributions shall be taken into account for purposes
of satisfying the minimum contribution requirements of Section 416(c)(2) of the Code and the Plan.
The preceding sentence shall apply with respect to Matching Contributions under the Plan or, if the
Plan provides that the minimum contribution requirement shall be met in another plan, such other
plan. Employer Matching Contributions that are used to satisfy the minimum contribution
requirements shall be treated as Matching Contributions for purposes of the actual contribution
percentage test and other requirements of Section 401(m) of the Code.
9.3.2 Contributions under other plans. The Employer may provide, in an addendum to this amendment,
that the minimum benefit requirement shall be met in another plan (including another plan that
consists solely of a cash or deferred arrangement which meets the requirements of Section
401(k)(12) of the Code and Matching Contributions with respect to which the requirements of
Section 401(m)(11) of the Code are met). The addendum should include the name of the other
plan, the minimum benefit that will be provided under such other plan, and the employees who will
receive the minimum benefit under such other plan.
ARTICLE X
DIRECT ROLLOVERS
10.1 Effective date. This Article shall apply to distributions made after December 31, 2001.
10.2 Modification of definition of eligible retirement plan. For purposes of the direct rollover provisions of the Plan,
an eligible retirement plan shall also mean an annuity contract described in Section 403(b) of the Code and
an eligible plan under Section 457(b) of the Code which is maintained by a state, political subdivision of a
state, or any agency or instrumentality of a state or political subdivision of a state and which .agrees to
separately account for amounts transferred into such plan from this Plan. The definition of eligible retirement
plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who
is the altemate payee under a qualified domestic relation order, as defined in Section 414(p) of the Code.
10.3 Modification of definition of eligible rollover distribution to exclude hardship distributions . For purposes of the
direct rollover provisions of the Plan, any amount that is distributed on account of hardship shall not be an
eligible rollover distribution and the distributee may not elect to have any portion of such a distribution paid
directly to an eligible retirement plan.
10.4 Modification of definition of eligible rollover distribution to include after-tax Employee Contributions. For
purposes of the direct rollover provisions in the Plan, a portion of a distribution shall not fail to be an eligible
rollover distribution merely because the portion consists of after-tax Employee Contributions which are not
includible in gross income. However, such portion may be transferred only to an individual retirement
account or annuity described in Section 408(a) or (b) of the Code, or to a qualified defined contribution plan
described in Section 401(a) or 403(a) of the Code that agrees to separately account for amounts so
transferred, including separately accounting for the portion of such distribution which is includible in gross
income and the portion of such distribution which is not so includible.
ARTICLE XI
ROLLOVERS FROM OTHER PLANS
Rollovers from other plans . If the Employer has elected in Section 2.5 above to allow rollovers from other plans, the
Employer, operationally and on a nondiscriminatory basis, may limit the source of rollover contributions that may be
accepted by this Plan.
ARTICLE XII
REPEAL OF MULTIPLE USE TEST
Repeal of Multiple Use Test The multiple use test described in Treasury Regulation Section 1.401(m)-2 and the Plan
shall not apply for Plan Years beginning after December 31, 2001.
ARTICLE XIII
ELECTIVE DEFERRALS
13.1 Elective Deferrals - Contribution Limitation. No Participant shall be permitted to have Elective Deferrals
made under this Plan, or any other qualified plan maintained by the Employer during any taxable year, in
excess of the dollar limitation contained in Section 402(g) of the Code in effect for such taxable year, except
to the extent permitted under Article V of this amendment and Section 414(v) of the Code, if applicable.
13.2 Maximum Salary Reduction Contributions for SIMPLE plans. If this is a SIMPLE 401(k) plan, then except to
the extent permitted under Article V of this amendment and Section 414(v) of the Code, if applicable, the
maximum salary reduction contribution that can be made to this Plan is the amount determined under
Section 408(p)(2)(A)(ii) of the Code for the calendar year.
ARTICLE XIV
SAFE HARBOR PLAN PROVISIONS
Modification of ToD Heavy Rules. The Top Heavy requirements of Section 416 of the Code and the Plan shall not
apply in any year beginning after December 31, 2001, in which the Plan consists solely of a cash or deferred
arrangement which meets the requirements of Section 401(k)(12) of the Code and Matching Contributions with
respect to which the requirements of Section 401(m)(11) of the Code are met.
ARTICLE XV
DISTRIBUTION UPON SEVERANCE OF EMPLOYMENT
15.1 Effective date. This Article shall apply for distributions and severances from employment occurring after the
dates specified by the Employer in Section 2.6 of this amendment.
15.2 New distributable event A Participant's Elective Deferrals, Qualified Nonelective Contributions, Qualified
Matching Contributions, and earnings attributable to these contributions shall be distributed on account of
the Participant's severance from employment. However, such a distribution shall be subject to the other
provisions of the Plan regarding distributions, other than provisions that require a separation from service
before such amounts may be distributed.
This amendment has been executed this _ 3 day of �0%-4 v at , 20 CF-3 .
Name of Employer: City of McCall
Name of Plan: City of McCall Exclusive Benefit Governmental 401 (a) Nontrusteed Retirement Plan
By:
Name:
Title:
64888.P003
(Print)
RESOLUTION AUTHORIZING ADOPTION OF
RETIREMENT PLAN
'RESOLVED, that CITY OF MCCALL (hereinafter, "the Employer"), acting under the authority of its
Personnel Officer, hereby establishes a retirement plan for the exclusive benefit of its employees and their
beneficiaries; and,
RESOLVED, FURTHER, that the Employer hereby adopts said retirement plan, the provisions of
which to be set out in a plan document; and,
RESOLVED, FINALLY, that the Employer hereby retains the right, from time to time, to amend,
modify or discontinue all or any portion of said retirement plan without the consent of the employees
participating in said plan, or the beneficiaries of any employees participating in said plan."
*********
I, rrCJIN Li° �--r\S do hereby certify that the above and foregoing
was adopted by the Personnel Officer at McCall, Idaho on the ,�i day of ..�.�� , -1005 .
Signature
WITNESS:
AIG
VALIC
Article I: This article states the purpose of the amendment and the effective date of the changes. It also confirms that the
amendment will supersede any provisions currently in the Plan to the contrary.
Article II: This article provides elections with respect to certain EGTRRA provisions.
Section 2.1: EGTRRA requires Matching Contributions to vest at least as rapidly as a 6-yr graded or 3-yr cliff vesting
schedule.
If an option is not selected in this section and your current vesting schedule does not comply with EGTRRA, the vesting
schedule will automatically default as follows: (i) 6-yr graded, if the Plan currently has a graded schedule or (ii) 3-yr cliff, ii
the Plan currently does not have a graded schedule. If your current vesting schedule does not comply with EGTRRA
and you would like to choose a vesting schedule other than the applicable defaults above, a selection must be
made.
Section 2.2: EGTRRA allows a reduction of the Elective Deferral suspension period following hardship distributions. This
section provides options using safe harbor standards.
The first option allows the change to a 6-month suspension period to be applied to distributions made in 2001, if the Plan
has operated accordingly.
The second and third options apply to post-2001 hardship distributions. These options apply the 6-month suspension
period as of January 1, 2002 or as of a specific later date. If no selection is made and your Plan currently provides
for hardship distributions using the safe harbor standards, the pre-EGTRRA 12-month suspension period will
continue to apply.
Section 2.3: This section provides the option to allow Employees who have attained age 50 before the close of the
calendar year to make Catch-up Contributions as of a certain effective date, in $1,000 increments each year as indexed.
Section 2.4: This section allows you to change the current Plan limit on Elective Deferrals as of a certain date to reflect
either (i) the maximum amount allowed by law or (ii) a specific maximum percentage of Compensation.
Section 2.5: This section provides the option to allow rollover contributions from other plan types into this Plan. It also
allows you to indicate whether distributions from these funds will be subject to Plan distribution requirements or allowed to
be withdrawn at any time.
Section 2.6: This section provides an option to allow distributions due to severance of employment and to apply this
option to distributions occurring after a certain date. The option is further applied to distributions regardless of when the
severance of employment occurred or only to severances of employment occurring after a certain date. If no selection is
made, the Plan will default to allow these distributions regardless of when the severance occurred.
The remaining articles of the amendment contain the plan document language for the EGTRRA changes.
Article III:
Section 3.1: This section provides that the new vesting requirements apply to Participants who complete an Hour of
Service after December 31, 2001, with respect to all accrued and future Matching Contributions.
Section 3.2: This section indicates that Matching Contributions will vest according to the vesting schedule selected in
Section 2.1.
Article IV:
Section 4.1: This section notes that the changes regarding hardship distributions shall apply for calendar years beginning
after 2001.
Section 4.2: This section explains the time period during which a Participant shall be prohibited from making Elective
Deferrals and Employee Contributions under this and all other plans, if elected in Section 2.2 of the amendment.
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Article V: This article provides for the allowance of Catch-up Contributions, if elected in Section 2.3 of the amendment.
Article VI: This article provides for the increase in the annual Compensation taken into account in determining allocations
of contributions to $200,000 for Plan Years beginning after December 31, 2001, with cost -of -living increases thereafter.
Article VII: This article extends loan provisions to owner -employees or shareholder -employees, as of January 1, 2002, if
loan provisions already exist in the Plan.
Article VIII:
Section 8.1: This section identifies the effective date for change in the Section 415 limit on contributions (Annual
Additions) as limitation years beginning after December 31, 2001.
Section 8.2: This section increases the maximum Annual Additions, which includes both Employee and Employer
Contributions and forfeiture allocations, to the lesser of (i) $40,000 or (ii)100% of Compensation.
Article IX:
Section 9.1: This section provides the effective date for using the new rules for determining whether a Plan is Top Heavy
and if the plan satisfies the minimum Top Heavy contribution requirements under the Code as Plan Years beginning after
December 31, 2001.
Section 9.2: This section provides rules for determination of a plan's Top Heavy status, including a definition of a Key
Employee and regarding account values.
Section 9.3.1: This section notes that Matching Contributions will be taken into account in determining if the Top Heavy
minimum contribution requirements are met.
Section 9.3.2: This section allows the Employer to identify another plan under which the minimum contribution
requirements will be met, in lieu of this Plan.
Article X:
Section 10.1: This section provides that EGTRRA changes related to direct rollovers apply to distributions made after
December 31, 2001.
Section 10.2: This section expands the definition of eligible rollover plan to include other plan types.
Section 10.3: This section excludes hardship distributions from the definition of eligible rollover distribution.
Section 10.4: This section modifies the definition of eligible rollover distribution to include after-tax Employee
Contributions.
Article XI: This article provides that if the Employer elected in Section 2.5 of the amendment to allow rollovers into the
Plan, the Employer may limit rollover sources.
Article XII: This section provides for the elimination of the multiple use test in nondiscrimination testing, effective for Plan
Years beginning after December 31, 2001.
Article XIII:
Section 13.1: This section provides that Elective Deferrals may not exceed the individual Internal Revenue Code limit
($11,000 for 2002), as indexed, without regard to Catch-up Contributions.
Section 13.2: This section limits salary reduction contributions to SIMPLE plans as required by the Internal Revenue
Code, without regard to Catch-up Contributions.
Article XIV: This article provides that the Top Heavy requirements do not apply to plans with Elective Deferrals and
Matching Contributions that meet the requirements to be a safe harbor plan.
Article XV:
Section 15.1: This section provides that changes regarding distributions and severances from employment shall apply to
those occurring after the dates specified in Section 2.6 of the amendment.
Section 15.2: This section identifies severance of employment as a new distributable event upon which a Participant will
be eligible to receive their Elective Deferrals, Qualified Nonelective Contributions, Qualified Matching Contributions, and
earnings attributable to these contributions.