Common use of Satisfaction of Loan Clause in Contracts

Satisfaction of Loan. In the event of default, foreclosure on the note and attachment of the security will not occur until a distributable event occurs under the terms of the Plan. If spousal consent (consistent with the requirements for a Qualified Election under Section 8.2) has been obtained, then, notwithstanding any other provision of the Plan, the portion of the Participant's vested account balance used as security for a loan shall be taken into account for purposes of determining the amount of the account balance payable at the time of death or distribution, but only if the reduction is used as repayment of the loan. If less than one hundred percent (100%) of the Participant's vested account balance (determined without regard to the preceding sentence) is payable to the surviving spouse, then the account balance shall be adjusted by first reducing the vested account balance by the amount of the security used as repayment of the loan, and then determining the benefit payable to the surviving spouse.