Exhibit 4.2
Flexible Nonstandardized Safe Harbor 401(k) Profit Sharing Plan
ADOPTION AGREEMENT
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SECTION 1. EMPLOYER INFORMATION
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Name of Employer NABI
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Address 0000 Xxxx xx Xxxxxxxx Xxxx XX
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City Boca Raton State FL Zip 33487
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Telephone 000-000-0000 Employer's Federal Tax Identification Number 00-0000000
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Type of Business (Check only one) [_] Sole Proprietorship [_] Partnership [X] C Corporation [_] S Corporation
[_] Other (Specify)
[_] Check here if Related Employers may participate in this Plan and attach a
Related Employer Participation Agreement for each Related Employer who will
participate in this Plan.
Business Code 2830
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Name of Plan NABI Savings & Retirement Plan
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Name of Trust (if different from Plan name)
Plan Sequence Number 001 (Enter 001 if this is the first qualified plan the
--- Employer has ever maintained, enter 002 if it is the
second, etc.)
Trust Identification Number (if applicable) 00-0000000 Account Number (Optional) 60222
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SECTION 2. EFFECTIVE DATES
Complete Parts A and B
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Part A. General Effective Dates (Check and Complete Option 1 or 2):
Option 1: [_] This is the initial adoption of a profit sharing plan by
the Employer. The Effective Date of this Plan is.
NOTE: The effective date is usually the first day of the
Plan Year in which this Adoption Agreement is signed.
Option 2: [X] This is an amendment and restatement of an existing
profit sharing plan (a Prior Plan). The Prior Plan was
initially effective on 01-01-1985.
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The Effective Date of this amendment and restatement
is 01-01-1998.
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NOTE: The effective date is usually the first day of the
Plan Year in which this Adoption Agreement is signed.
Part B. Commencement of Elective Deferrals:
Elective Deferrals may commence on.
NOTE: This date may be no earlier than the date this Adoption
Agreement is signed because Elective Deferrals cannot be made
retroactively.
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SECTION 3. RELEVANT TIME PERIODS
Complete Parts A through C
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Part A. Employer's Fiscal Year:
The Employer's fiscal year ends (Specify month and date) 12-31
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Part B. Plan Year Means:
Option 1: [_] The 12-consecutive month period which coincides with
the Employer's fiscal year.
Option 2: [X] The calendar year.
Option 3: [_] Other 12-consecutive month period (Specify)
NOTE: If no option is selected, Option 1 will be deemed to be selected.
If the initial Plan Year is less than 12 months (a short Plan Year)
specify such Plan Year's beginning and ending dates.
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Part C. Limitation Year Means:
Option 1: [X] The Plan Year.
Option 2: [_] The calendar year.
Option 3: [_] Other 12-consecutive month period (Specify)
NOTE: If no option is selected, Option 1 will be deemed to be selected.
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SECTION 4. ELIGIBILITY REQUIREMENTS
Complete Parts A through G
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Part A. Years of Eligibility Service Requirement:
1. Elective Deferrals.
An Employee will be eligible to become a Contributing Participant
in the Plan (and thus be eligible to make Elective Deferrals) and
receive Matching Contributions (including Qualified Matching
Contributions, if applicable) after completing 1 (enter 0, 1 or any
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fraction less than 1) Years of Eligibility Service.
2. Employer Profit Sharing Contributions.
An Employee will be eligible to become a Participant in the Plan
for purposes of receiving an allocation of any Employer Profit
Sharing Contribution made pursuant to Section 10 of the Adoption
Agreement after completing 1 (enter 0, 1, 2 or any fraction less
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than 2) Years of Eligibility Service.
NOTE: If more than 1 year is selected for Item 2, the immediate 100%
vesting schedule of Section 12 will automatically apply for
contributions described in such item. If either item is left blank, the
Years of Eligibility Service required for such item will be deemed to
be 0. If a fraction is selected, an Employee will not be required to
complete any specified number of Hours of Service to receive credit for
a fractional year. If a single Entry Date is selected in Section 4,
Part G for an item, the Years of Eligibility Service required for such
item cannot exceed 1 1/2 (1/2 for Elective Deferrals).
Part B. Age Requirement:
1. Elective Deferrals.
An Employee will be eligible to become a Contributing Participant
(and thus be eligible to make Elective Deferrals) and receive
Matching Contributions (including Qualified Matching Contributions,
if applicable) after attaining age 21 (no more than 21).
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2. Employer Profit Sharing Contributions.
An Employee will be eligible to become a Participant in the Plan
for purposes of receiving an allocation of any Employer Profit
Sharing Contribution made pursuant to Section 10 of the Adoption
Agreement after attaining age 21 (no more than 21).
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NOTE: If either of the above items in this Section 4, Part B is left
blank, it will be deemed there is no age requirement for such item. If
a single Entry Date is selected in Section 4, Part G for an item, no
age requirement can exceed 20 1/2 for such item.
Part C. Employees Employed As Of Effective Date:
Will all Employees employed as of the Effective Date of this Plan who
have not otherwise met the requirements of Part A or Part B above be
considered to have met those requirements as of the Effective Date?
[_] Yes [X] No
NOTE: If a box is not checked in this Section 4, Part C, "No" will be
deemed to be selected.
Part D. Exclusion of Certain Classes of Employees:
All Employees will be eligible to become Participants in the Plan
except:
a. [_] Those Employees included in a unit of Employees covered by a
collective bargaining agreement between the Employer and
Employee representatives, if retirement benefits were the
subject of good faith bargaining and if two percent or less of
the Employees who are covered pursuant to that agreement are
professionals as defined in Section 1.410(b)-9 of the
regulations. For this purpose, the term "employee
representatives" does not include any organization more than
half of whose members are Employees who are owners, officers, or
executives of the Employer.
b. [_] Those Employees who are non-resident aliens (within the meaning
of Section 7701(b)(1)(B) of the Code) and who received no earned
income (within the meaning of Section 911(d)(2) of the Code)
from the Employer which constitutes income from sources within
the United States (within the meaning of Section 861(a)(3) of
the Code).
c. [_] Those Employees of a Related Employer that has not executed a
Related Employer Participation Agreement.
d. [X] Other (Define) Employees employed by NABI-Rockville division.
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Part E. Election Not To Participate:
May an Employee or a Participant elect not to participate in this Plan
pursuant to Section 2.08 of the Plan?
Option 1: [_] Yes.
Option 2: [X] No.
NOTE: If no option is selected, Option 2 will be deemed to be selected.
Part F. Hours Required For Eligibility Purposes:
1. 1000 Hours of Service (no more than 1,000) shall be required
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to constitute a Year of Eligibility Service.
2. 500 Hours of Service (no more than 500 but less than the
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number specified in Section 4, Part F, Item 1, above) must be
exceeded to avoid a Break in Eligibility Service.
3. For purposes of determining Years of Eligibility Service, Employees
shall be given credit for Hours of Service with the following
predecessor employer(s): (Complete if applicable)
Part G. Entry Dates:
The Entry Dates for participation shall be (Choose one):
Option 1: [_] The first day of the Plan Year and the first day of the
seventh month of the Plan Year.
Option 2: [X] Other (Specify) 1/1, 4/1, 7/1, or 10/1 coinciding with
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or next following the date the
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Eligibility Requirements are met.
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NOTE: If no option is selected, Option 1 will be deemed to be selected.
Option 2 can be selected only if the eligibility requirements and Entry
Dates are coordinated such that each Employee will become a Participant
in the Plan no later than the earlier of: (1) the first day of the Plan
Year beginning after the date the Employee satisfies the age and
service requirements of Section 410(a) of the Code; or (2) 6 months
after the date the Employee satisfies such requirements.
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SECTION 5. METHOD OF DETERMINING SERVICE
Complete Part A or B
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Part A. Hours of Service Equivalencies:
Service will be determined on the basis of the method selected below.
Only one method may be selected. The method selected will be applied to
all Employees covered under the Plan. (Choose one):
Option 1: [X] On the basis of actual hours for which an Employee is
paid or entitled to payment.
Option 2: [_] On the basis of days worked. An Employee will be
credited with 10 Hours of Service if under Section 1.24
of the Plan such Employee would be credited with at
least 1 Hour of Service during the day.
Option 3: [_] On the basis of weeks worked. An Employee will be
credited with 45 Hours of Service if under Section 1.24
of the Plan such Employee would be credited with at
least 1 Hour of Service during the week.
Option 4: [_] On the basis of months worked. An Employee will be
credited with 190 Hours of Service if under Section 1.24
of the Plan such Employee would be credited with at
least 1 Hour of Service during the month.
NOTE: If no option is selected, Option 1 will be deemed to be selected.
This Section 5, Part A will not apply if the Elapsed Time Method of
Section 5, Part B is selected.
Part B. Elapsed Time Method:
In lieu of tracking Hours of Service of Employees, will the elapsed
time method described in Section 2.07 of the Plan be used? (Choose one)
Option 1: [_] No.
Option 2: [_] Yes.
NOTE: If no option is selected, Option 1 will be deemed to be selected.
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SECTION 6. ELECTIVE DEFERRALS
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Part A. Authorization of Elective Deferrals:
Will Elective Deferrals be permitted under this Plan? (Choose one)
Option 1: [X] Yes.
Option 2: [_] No.
NOTE: If no option is selected, Option 1 will be deemed to be selected.
Complete the remainder of Section 6 only if Option 1 is selected.
Part B. Limits on Elective Deferrals:
If Elective Deferrals are permitted under the Plan, a Contributing
Participant may elect under a salary reduction agreement to have his or
her Compensation reduced by an amount as described below (Choose one):
Option 1: [X] An amount equal to a percentage of the Contributing
Participant's Compensation from 1 % to 15 % in
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increments of 1 %.
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Option 2: [_] An amount of the Contributing Participant's Compensation
not less than and not more than.
The amount of such reduction shall be contributed to the Plan by the
Employer on behalf of the Contributing Participant. For any taxable
year, a Contributing Participant's Elective Deferrals shall not exceed
the limit contained in Section 402(g) of the Code in effect at the
beginning of such taxable year.
Part C. Elective Deferrals Based on Bonuses:
Instead of or in addition to making Elective Deferrals through payroll
deduction, may a Contributing Participant elect to contribute to the
Plan, as an Elective Deferral, part or all of a bonus rather than
receive such bonus in cash? (Choose one)
Option 1: [X] Yes.
Option 2: [_] No.
NOTE: If no option is selected, Option 2 will be deemed to be selected.
Part D. Return As A Contributing Participant After Ceasing Elective Deferrals:
A Participant who ceases Elective Deferrals by revoking a salary
reduction agreement may return as a Contributing Participant as of such
times established by the Plan Administrator in a uniform and
nondiscriminatory manner.
Part E. Changing Elective Deferral Amounts:
A Contributing Participant may modify a salary reduction agreement to
prospectively increase or decrease the amount of his or her Elective
Deferrals as of such times established by the Plan Administrator in a
uniform and nondiscriminatory manner.
Part F. Claiming Excess Elective Deferrals:
Participants who claim Excess Elective Deferrals for the preceding
calendar year must submit their claims in writing to the Plan
Administrator by (Choose one):
Option 1: [X] March 1.
Option 2: [_] Other (Specify a date not later than April 15)
NOTE: If no option is selected, Option 1 will be deemed to be selected.
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SECTION 7. MATCHING CONTRIBUTIONS
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Part A. Authorization of Matching Contributions:
Will the Employer make Matching Contributions to the Plan on behalf of
Qualifying Contributing Participants? (Choose one)
Option 1: [X] Yes, but only with respect to a Contributing
Participant's Elective Deferrals.
Option 2: [_] Yes, but only with respect to a Participant's
Nondeductible Employee Contributions.
Option 3: [_] Yes, with respect to both Elective Deferrals and
Nondeductible Employee Contributions.
Option 4: [_] No.
NOTE: If no option is selected, Option 4 will be deemed to be selected.
Complete the remainder of Section 7 only if Option 1, 2 or 3 is
selected.
Part B. Matching Contribution Formula:
If the Employer will make Matching Contributions, then the amount of
such Matching Contributions made on behalf of a Qualifying Contributing
Participant each Plan Year shall be (Choose one):
Option 1: [_] An amount equal to ________% of such Contributing
Participant's Elective Deferral (and/or Nondeductible
Employee Contribution, if applicable).
Option 2: [_] An amount equal to the sum of ________% of the portion
of such Contributing Participant's Elective Deferral
(and/or Nondeductible Employee Contribution, if
applicable) which does not exceed ________% of the
Contributing Participant's Compensation plus ________%
of the portion of such Contributing Participant's
Elective Deferral (and/or Nondeductible Employee
Contribution, if applicable) which exceeds ________% of
the Contributing Participant's Compensation.
Option 3: [X] Such amount, if any, equal to that percentage of each
Contributing Participant's Elective Deferral (and/or
Nondeductible Employee Contribution, if applicable)
which the Employer, in its sole discretion, determines
from year to year.
Option 4: [_] Other Formula. (Specify)
NOTE: If Option 4 is selected, the formula specified can only allow
Matching Contributions to be made with respect to a Contributing
Participant's Elective Deferrals (and/or Nondeductible Employee
Contribution, if applicable).
Part C. Limit on Matching Contributions:
Notwithstanding the Matching Contribution formula specified above, no
Matching Contribution will be made with respect to a Contributing
Participant's Elective Deferrals (and/or Nondeductible Employee
Contributions, if applicable) in excess of or 15% of such Contributing
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Participant's Compensation.
Page 6
Part D. Qualifying Contributing Participants:
A Contributing Participant who satisfies the eligibility requirements
described in Section 4 will be a Qualifying Contributing Participant
and thus entitled to share in Matching Contributions for any Plan Year
only if the Participant is a Contributing Participant and satisfies the
following additional conditions (Check one or more Options):
Option 1: [_] No Additional Conditions.
Option 2: [_] Hours of Service Requirement. The Contributing
Participant completes at least _______ Hours of Service
during the Plan Year. However, this condition will be
waived for the following reasons
(Check at least one):
[_] The Contributing Participant's Death.
[_] The Contributing Participant's Termination of
Employment after having incurred a Disability.
[_] The Contributing Participant's Termination of
Employment after having reached Normal Retirement
Age.
[_] This condition will not be waived.
Option 3: [X] Last Day Requirement. The Participant is an Employee of
the Employer on the last day of the Plan Year. However,
this condition will be waived for the following reasons
(Check at least one):
[X] The Contributing Participant's Death.
[X] The Contributing Participant's Termination of
Employment after having incurred a Disability.
[X] The Contributing Participant's Termination of
Employment after having reached Normal Retirement
Age.
[_] This condition will not be waived.
NOTE: If no option is selected, Option 1 will be deemed to be selected.
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SECTION 8. QUALIFIED NONELECTIVE CONTRIBUTIONS
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Part A. Authorization of Qualified Nonelective Contributions:
Will the Employer make Qualified Nonelective Contributions to the Plan?
(Choose One)
Option 1: [X] Yes.
Option 2: [_] No.
If the Employer elects to make Qualified Nonelective Contributions,
then the amount, if any, of such contribution to the Plan for each Plan
Year shall be an amount determined by the Employer.
NOTE: If no option is selected, Option 1 will be deemed to be selected.
Complete the remainder of Section 8 only if Option 1 is selected.
Part B. Participants Entitled to Qualified Nonelective Contributions:
Allocation of Qualified Nonelective Contributions shall be made to the
Individual Accounts of (Choose one):
Option 1: [X] Only Participants who are not Highly Compensated
Employees.
Option 2: [_] All Participants.
NOTE: If no option is selected, Option 1 will be deemed to be selected.
Part C. Allocation of Qualified Nonelective Contributions:
Allocation of Qualified Nonelective Contributions to Participants
entitled thereto shall be made (Choose one):
Option 1: [X] In the ratio which each Participant's Compensation for
the Plan Year bears to the total Compensation of all
Participants for such Plan Year.
Option 2: [_] In the ratio which each Participant's Compensation not in
excess of ____________ for the Plan Year bears to the
total Compensation of all Participants not in excess of
___________ for such Plan Year.
NOTE: If no option is selected, Option 1 will be deemed to be selected.
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SECTION 9. QUALIFIED MATCHING CONTRIBUTIONS
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Part A. Authorization of Qualified Matching Contributions:
Will the Employer make Qualified Matching Contributions to the Plan on
behalf of Qualifying Contributing Participants?
(Choose One)
Option 1: [X] Yes, but only with respect to a Contributing
Participant's Elective Deferrals.
Option 2: [_] Yes, but only with respect to a Participant's
Nondeductible Employee Contributions.
Option 3: [_] Yes, with respect to both Elective Deferrals and
Nondeductible Employee Contributions.
Option 4: [_] No.
NOTE: If no option is selected, Option 3 will be deemed to be
selected. Complete the remainder of Section 9 only if Option 1, 2 or 3
is selected.
Part B. Qualified Matching Contribution Formula:
If the Employer will make Qualified Matching Contributions, then the
amount of such Qualified Matching Contributions made on behalf of a
Qualifying Contributing Participant each Plan Year shall be (Choose
one):
Option 1: [_] An amount equal to ________% of such Contributing
Participant's Elective Deferral (and/or Nondeductible
Employee Contribution, if applicable).
Option 2: [_] An amount equal to the sum of ________% of the portion
of such Contributing Participant's Elective Deferral
(and/or Nondeductible Employee Contribution, if
applicable) which does not exceed ________% of the
Contributing Participant's Compensation plus ________%
of the portion of such Contributing Participant's
Elective Deferral (and/or Nondeductible Employee
Contribution, if applicable) which exceeds ________% of
the Contributing Participant's Compensation.
Option 3: [X] Such amount, if any, as determined by the Employer in
its sole discretion, equal to that percentage of the
Elective Deferrals (and/or Nondeductible Employee
Contribution, if applicable) of each Contributing
Participant entitled thereto which would be sufficient
to cause the Plan to satisfy the Actual Contribution
Percentage tests (described in Section 11.402 of the
Plan) for the Plan Year.
Option 4: [_] Other Formula. (Specify)
NOTE: If no option is selected, Option 3 will be deemed to be
selected.
Part C. Participants Entitled to Qualified Matching Contributions:
Qualified Matching Contributions, if made to the Plan, will be made on
behalf of (Choose one):
Option 1: [X] Only Contributing Participants who make Elective
Deferrals who are not Highly Compensated Employees.
Option 2: [_] All Contributing Participants who make Elective
Deferrals.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
Part D. Limit On Qualified Matching Contributions:
Notwithstanding the Qualified Matching Contribution formula specified
above, the Employer will not match a Contributing Participant's
Elective Deferrals (and/or Nondeductible Employee Contribution, if
applicable) in excess of ______________ or 15% of such Contributing
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Participant's Compensation.
Page 8
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SECTION 10. EMPLOYER PROFIT SHARING CONTRIBUTIONS
Complete Parts A, B and C
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Part A. Contribution Formula:
For each Plan Year the Employer will contribute an Amount to be
determined from year to year.
Part B. Allocation Formula (Choose one):
Option 1: [X] Pro Rata Formula. Employer Profit Sharing Contributions
shall be allocated to the Individual Accounts of
Qualifying Participants in the ratio that each
Qualifying Participant's Compensation for the Plan Year
bears to the total Compensation of all Qualifying
Participants for the Plan Year.
Option 2: [_] Integrated Formula. Employer Profit Sharing
Contributions shall be allocated as follows (Start with
Step 3 if this Plan is not a Top-Heavy Plan):
Step 1. Employer Profit Sharing Contributions shall
first be allocated pro rata to Qualifying
Participants in the manner described in Section
10, Part B, Option 1. The percent so allocated
shall not exceed 3% of each Qualifying
Participant's Compensation.
Step 2. Any Employer Profit Sharing Contributions
remaining after the allocation in Step 1 shall
be allocated to each Qualifying Participant's
Individual Account in the ratio that each
Qualifying Participant's Compensation for the
Plan Year in excess of the integration level
bears to all Qualifying Participants'
Compensation in excess of the integration
level, but not in excess of 3%.
Step 3. Any Employer Profit Sharing Contributions
remaining after the allocation in Step 2 shall
be allocated to each Qualifying Participant's
Individual Account in the ratio that the sum of
each Qualifying Participant's total
Compensation and Compensation in excess of the
integration level bears to the sum of all
Qualifying Participants' total Compensation and
Compensation in excess of the integration
level, but not in excess of the profit sharing
maximum disparity rate as described in Section
3.01(B)(3) of the Plan.
Step 4. Any Employer Profit Sharing Contributions
remaining after the allocation in Step 3 shall
be allocated pro rata to Qualifying
Participants in the manner described in Section
10, Part B, Option 1.
The integration level shall be (Choose one):
Suboption (a): [_] The Taxable Wage Base.
Suboption (b): [_] _______________ (a dollar amount less
than the Taxable Wage Base).
Suboption (c): [_] ________% (not more than 100%) of the
Taxable Wage Base.
NOTE: If no option is selected, Suboption (a) will be
deemed to be selected.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
Part C. Qualifying Participants:
A Participant will be a Qualifying Participant and thus entitled to
share in the Employer Profit Sharing Contribution for any Plan Year
only if the Participant is a Participant on at least one day of such
Plan Year and satisfies the following additional conditions (Check one
or more Options):
Option 1: [_] No Additional Conditions.
Option 2: [_] Hours of Service Requirement. The Participant completes
at least ________ Hours of Service during the Plan Year.
However, this condition will be waived for the following
reasons (Check at least one):
[_] The Participant's Death.
[_] The Participant's Termination of Employment after
having incurred a Disability.
[_] The Participant's Termination of Employment after
having reached Normal Retirement Age.
[_] This condition will not be waived.
Option 3: [X] Last Day Requirement. The Participant is an Employee of
the Employer on the last day of the Plan Year. However,
this condition will be waived for the following reasons
(Check at least one):
[X] The Participant's Death.
[X] The Participant's Termination of Employment after
having incurred a Disability.
[X] The Participant's Termination of Employment after
having reached Normal Retirement Age.
[_] This condition will not be waived.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
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SECTION 11. COMPENSATION
Complete Parts A through E
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Part A. Basic Definition:
Compensation will mean all of each Participant's (Choose one):
Option 1: [X] W-2 wages.
Option 2: [_] Section 3401(a) wages.
Option 3: [_] 415 safe-harbor compensation.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
Part B. Measuring Period for Compensation:
Compensation shall be determined over the following applicable period
(Choose one):
Option 1: [X] The Plan Year.
Option 2: [_] The calendar year ending with or within the Plan Year.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
Part C. Inclusion of Elective Deferrals:
Does Compensation include Employer Contributions made pursuant to a
salary reduction agreement which are not includible in the gross income
of the Employee under Sections 125, 402(e)(3), 402(h)(1)(B) and 403(b)
of the Code?
[X] Yes [_] No
NOTE: If neither box is checked, "Yes" will be deemed to be selected.
Part D. Pre-Entry Date Compensation:
For the Plan Year in which an Employee enters the Plan, the Employee's
Compensation which shall be taken into account for purposes of the Plan
shall be (Choose one):
Option 1: [_] The Employee's Compensation only from the time the
Employee became a Participant in the Plan.
Option 2: [X] The Employee's Compensation for the whole of such Plan
Year.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
Part E. Exclusions From Compensation:
Compensation shall not include the following (Check any that apply):
[_] Bonuses [_] Commissions
[_] Overtime [_] Other (Specify)
NOTE: No exclusions from Compensation are permitted if the integrated
allocation formula in Section 10, Part B is selected.
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SECTION 12. VESTING AND FORFEITURES
Complete Parts A through G
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Part A. Vesting Schedule For Employer Profit Sharing Contributions. A
Participant shall become Vested in his or her Individual Account
derived from Profit Sharing Contributions made pursuant to Section 10
of the Adoption Agreement as follows (Choose one):
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YEARS OF VESTED PERCENTAGE
VESTING SERVICE Option 1 [_] Option 2 [_] Option 3 [X] Option 4 [_] Option 5 [_] (Complete if Chosen)
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1 0% 0% 100% 0% ________ %
2 0% 20% 100% 0% ________ %
3 0% 40% 100% 20% ________ % (not less than 20%)
4 0% 60% 100% 40% ________ % (not less than 40%)
5 100% 80% 100% 60% ________ % (not less than 60%)
6 100% 100% 100% 80% ________ % (not less than 80%)
7 100% 100% 100% 100% ________ % (not less than 100%)
NOTE: If no option is selected, Option 3 will be deemed to be selected.
Page 10
Part B. Vesting Schedule For Matching Contributions. A Participant shall become
Vested in his or her Individual Account derived from Matching
Contributions made pursuant to Section 7 of the Adoption Agreement as
follows (Choose one):
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YEARS OF VESTED PERCENTAGE
VESTING SERVICE Option 1 [_] Option 2 [_] Option 3 [X] Option 4 [_] Option 5 [_] (Complete if Chosen)
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1 0% 0% 100% 0% ________ %
2 0% 20% 100% 0% ________ %
3 0% 40% 100% 20% ________ % (not less than 20%)
4 0% 60% 100% 40% ________ % (not less than 40%)
5 100% 80% 100% 60% ________ % (not less than 60%)
6 100% 100% 100% 80% ________ % (not less than 80%)
7 100% 100% 100% 100% ________ % (not less than 100%)
NOTE: If no option is selected, Option 3 will be deemed to be selected
Part C. Hours Required For Vesting Purposes:
1. __________ Hours of Service (no more than 1,000) shall be required
to constitute a Year of Vesting Service.
2. __________ Hours of Service (no more than 500 but less than the
number specified in Section 12, Part C, Item 1, above) must be
exceeded to avoid a Break in Vesting Service.
3. For purposes of determining Years of Vesting Service, Employees
shall be given credit for Hours of Service with the following
predecessor employer(s): (Complete if applicable)
Part D. Exclusion of Certain Years of Vesting Service:
All of an Employee's Years of Vesting Service with the Employer are
counted to determine the vesting percentage in the Participant's
Individual Account except (Check any that apply):
[_] Years of Vesting Service before the Employee reaches age 18.
[_] Years of Vesting Service before the Employer maintained this Plan
or a predecessor plan.
Part E. Allocation of Forfeitures of Employer Profit Sharing Contributions:
Forfeitures of Employer Profit Sharing Contributions shall be (Choose
one):
Option 1: [_] Allocated to the Individual Accounts of the
Participants specified below in the manner as described
in Section 10, Part B (for Employer Profit Sharing
Contributions)
The Participants entitled to receive allocations of
such Forfeitures shall be (Choose one):
Suboption (a): [_] Only Qualifying Participants.
Suboption (b): [_] All Participants.
Option 2: [_] Applied to reduce Employer Profit Sharing Contributions
(Choose one):
Suboption (a): [_] For the Plan Year for which the
Forfeiture arises.
Suboption (b): [_] For any Plan Year subsequent to the
Plan Year for which the Forfeiture
arises.
Option 3: [_] Applied first to the payment of the Plan's
administrative expenses and any excess applied to
reduce Employer Profit Sharing Contributions (Choose
one):
Suboption (a): [_] For the Plan Year for which the
Forfeiture arises.
Suboption (b): [_] For any Plan Year subsequent to the
Plan Year for which the Forfeitures
arises.
NOTE: If no option is selected, Option 1 and Suboption (a) will be
deemed to be selected.
Page 11
Part F. Allocation of Forfeitures of Matching Contributions:
Forfeitures of Matching Contributions shall be (Choose one):
Option 1: [_] Allocated, after all other Forfeitures under the Plan,
to each Participant's Individual Account in the ratio
which each Participant's Compensation for the Plan Year
bears to the total Compensation of all Participants for
such Plan Year.
The Participants entitled to receive allocations of such
Forfeitures shall be (Choose one):
Suboption (a): [_] Only Qualifying Contributing
Participants.
Suboption (b): [_] Only Qualifying Participants.
Suboption (c): [_] All Participants.
Option 2: [_] Applied to reduce Matching Contributions (Choose one):
Suboption (a): [_] For the Plan Year for which the
Forfeiture arises.
Suboption (b): [_] For any Plan Year subsequent to the
Plan Year for which the Forfeiture
arises.
Option 3: [_] Applied first to the payment of the Plan's
administrative expenses and any excess applied to reduce
Matching Contributions (Choose one):
Suboption (a): [_] For the Plan Year for which the
Forfeiture arises.
Suboption (b): [_] For any Plan Year subsequent to the
Plan Year for which the Forfeitures
arises.
NOTE: If no option is selected, Option 1 and Suboption (a) will be
deemed to be selected.
Part G. Allocation of Forfeitures of Excess Aggregate Contributions:
Forfeitures of Excess Aggregate Contributions shall be (Choose one):
Option 1: [_] Allocated, after all other Forfeitures under the Plan, to
each Contributing Participant's Matching Contribution
account in the ratio which each Contributing
Participant's Compensation for the Plan Year bears to the
total Compensation of all Contributing Participants for
such Plan Year. Such Forfeitures will not be allocated to
the account of any Highly Compensated Employee.
Option 2: [_] Applied to reduce Matching Contributions (Choose one):
Suboption (a): [_] For the Plan Year for which the
Forfeiture arises.
Suboption (b): [_] For any Plan Year subsequent to the
Plan Year for which the Forfeiture
arises.
Option 3: [_] Applied first to the payment of the Plan's administrative
expenses and any excess applied to reduce Matching
Contributions (Choose one):
Suboption (a): [_] For the Plan Year for which the
Forfeiture arises.
Suboption (b): [_] For any Plan Year subsequent to the
Plan Year for which the Forfeitures
arises.
NOTE: If no option is selected, Option 2 and Suboption (a) will be
deemed to be selected.
--------------------------------------------------------------------------------
SECTION 13. NORMAL RETIREMENT AGE AND EARLY RETIREMENT AGE
--------------------------------------------------------------------------------
Part A. The Normal Retirement Age under the Plan shall be (Check and complete
one option):
Option 1: [_] Age 65.
Option 2: [_] Age ________ (not to exceed 65).
Option 3: [_] The later of age ________ (not to exceed 65) or the
________ (not to exceed 5th) anniversary of the first day
of the first Plan Year in which the Participant commenced
participation in the Plan.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
Page 12
Part B. Early Retirement Age (Choose one option):
Option 1: [X] An Early Retirement Age is not applicable under the
Plan.
Option 2: [_] Age ________ (not less than 55 or more than 65).
Option 3: [_] A Participant satisfies the Plan's Early Retirement Age
conditions by attaining age ________ (not less than 55)
and completing ________ Years of Vesting Service.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
--------------------------------------------------------------------------------
SECTION 14. DISTRIBUTIONS
--------------------------------------------------------------------------------
Distributable Events. Answer each of the following items.
A. Termination of Employment Before Normal Retirement Age. May a Participant
who has not reached Normal Retirement Age request a distribution from the
Plan?
[X] Yes [_] No
B. Disability. May a Participant who has incurred a Disability request a
distribution from the Plan?
[X] Yes [_] No
C. Attainment of Normal Retirement Age. May a Participant who has attained
Normal Retirement Age but has not incurred a Termination of Employment
request a distribution from the Plan?
[X] Yes [_] No
D. Attainment of Age 59 1/2. Will Participants who have attained age 59 1/2 be
permitted to withdraw Elective Deferrals while still employed by the
Employer?
[X] Yes [_] No
E. Hardship Withdrawals of Elective Deferrals. Will Participants be permitted
to withdraw Elective Deferrals on account of hardship pursuant to Section
11.503 of the Plan?
[X] Yes [_] No
F. In-Service Withdrawals. Will Participants be permitted to request a
distribution during service pursuant to Section 6.01(A)(3) of the Plan?
[X] Yes [_] No
G. Hardship Withdrawals. Will Participants be permitted to make hardship
withdrawals pursuant to Section 6.01(A)(4) of the Plan?
[_] Yes [X] No
H. Withdrawals of Rollover or Transfer Contributions. Will Employees be
permitted to withdraw their Rollover or Transfer Contributions at any time?
[X] Yes [_] No
NOTE: If a box is not checked for an item, "Yes" will be deemed to be selected
for that item. Section 411(d)(6) of the Code prohibits the elimination of
protected benefits. In general, protected benefits include the forms and timing
of payout options. If the Plan is being adopted to amend and replace a Prior
Plan that permitted a distribution option described above, you must answer "Yes"
to that item.
--------------------------------------------------------------------------------
SECTION 15. JOINT AND SURVIVOR ANNUITY
--------------------------------------------------------------------------------
Part A. Retirement Equity Act Safe Harbor:
Will the safe harbor provisions of Section 6.05(F) of the Plan apply?
(Choose only one option)
Option 1: [X] Yes.
Option 2: [_] No.
Page 13
NOTE: You must select "No" if you are adopting this Plan as an
amendment and restatement of a Prior Plan that was subject to the joint
and survivor annuity requirements.
Part B. Survivor Annuity Percentage: (Complete only if your answer in Section
15, Part A is "No.")
The survivor annuity portion of the Joint and Survivor Annuity shall be
a percentage equal to ________ % (at least 50% but no more than 100%)
of the amount paid to the Participant prior to his or her death.
Page 14
--------------------------------------------------------------------------------
SECTION 16. OTHER OPTIONS
Answer "Yes" or "No" to each of the following questions by checking the
appropriate box.
If a box is not checked for a question, the answer will be deemed to be "No."
--------------------------------------------------------------------------------
A. Loans: Will loans to Participants pursuant to Section 6.08 of the Plan be
permitted?
[X] Yes [_] No
B. Insurance: Will the Plan allow for the investment in insurance policies
pursuant to Section 5.13 of the Plan?
[_] Yes [X] No
C. Employer Securities: Will the Plan allow for the investment in qualifying
Employer securities or qualifying Employer real property?
[_] Yes [X] No
D. Rollover Contributions: Will Employees be permitted to make rollover
contributions to the Plan pursuant to Section 3.03 of the Plan?
[X] Yes [_] No
[_] Yes, but only after
becoming a Participant.
E. Transfer Contributions: Will Employees be permitted to make transfer
contributions to the Plan pursuant to Section 3.04 of the Plan?
[X] Yes [_] No
[_] Yes, but only after
becoming a Participant.
F. Nondeductible Employee Contributions: Will Employees be permitted to make
Nondeductible Employee Contributions pursuant to Section 11.305 of the Plan?
[_] Yes [X] No
Check here if such contributions will be mandatory. [_]
G. Will Participants be permitted to direct the investment of their Plan assets
pursuant to Section 5.14 of the Plan?
[X] Yes [_] No
--------------------------------------------------------------------------------
SECTION 17. LIMITATION ON ALLOCATIONS
More Than One Plan
--------------------------------------------------------------------------------
If you maintain or ever maintained another qualified plan in which any
Participant in this Plan is (or was) a Participant or could become a
Participant, you must complete this section. You must also complete this section
if you maintain a welfare benefit fund, as defined in Section 419(e) of the
Code, or an individual medical account, as defined in Section 415(l)(2) of the
Code, under which amounts are treated as annual additions with respect to any
Participant in this Plan.
Part A. Individually Designed Defined Contribution Plan:
If the Participant is covered under another qualified defined
contribution plan maintained by the Employer, other than a master or
prototype plan:
1. [_] The provisions of Section 3.05(B)(1) through 3.05(B)(6) of the
Plan will apply as if the other plan were a master or prototype
plan.
2. [_] Other method. (Provide the method under which the plans will
limit total annual additions to the maximum permissible amount,
and will properly reduce any excess amounts, in a manner that
precludes Employer discretion.)
Part B. Defined Benefit Plan:
If the Participant is or has ever been a participant in a defined
benefit plan maintained by the Employer, the Employer will provide
below the language which will satisfy the 1.0 limitation of Section
415(e) of the Code.
1. [_] If the projected annual addition to this Plan to the account of
a Participant for any limitation year would cause the 1.0
limitation of Section 415(e) of the Code to be exceeded, the
annual benefit of the defined benefit plan for such limitation
year shall be reduced so that the 1.0 limitation shall be
satisfied.
Page 15
If it is not possible to reduce the annual benefit of the defined
benefit plan and the projected annual addition to this Plan to
the account of a Participant for a limitation year would cause
the 1.0 limitation to be exceeded, the Employer shall reduce the
Employer Contribution which is to be allocated to this Plan on
behalf of such Participant so that the 1.0 limitation will be
satisfied. (The provisions of Section 415(e) of the Code are
incorporated herein by reference under the authority of Section
1106(h) of the Tax Reform Act of 1986.)
2. [_] Other method. (Provide language describing another method. Such
language must preclude Employer discretion.)
Page 16
--------------------------------------------------------------------------------
SECTION 18. TOP-HEAVY MINIMUM
Complete Parts A and B
--------------------------------------------------------------------------------
Part A. Minimum Allocation or Benefit:
For any Plan Year with respect to which this Plan is a Top-Heavy Plan,
any minimum allocation required pursuant to Section 3.01(E) of the Plan
shall be made (Choose one):
Option 1: [X] To this Plan.
Option 2: [_] To the following other plan maintained by the Employer
(Specify name and plan number of plan)
Option 3: [_] In accordance with the method described on an attachment
to this Adoption Agreement. (Attach language describing
the method that will be used to satisfy Section 416 of
the Code. Such method must preclude Employer discretion.)
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
Part B. Top-Heavy Vesting Schedule:
Pursuant to Section 6.01(C) of the Plan, the vesting schedule that will
apply when this Plan is a Top-Heavy Plan (unless the Plan's regular
vesting schedule provides for more rapid vesting) shall be (Choose
one):
Option 1: [_] 6 Year Graded.
Option 2: [_] 3 Year Cliff.
NOTE: If no option is selected, Option 1 will be deemed to be
selected.
--------------------------------------------------------------------------------
SECTION 19. PROTOTYPE SPONSOR
--------------------------------------------------------------------------------
Name of Prototype Sponsor Travelers Insurance Company
---------------------------
Address Xxx Xxxxx Xxxxxx, Xxxxxxxx, XX 00000
------------------------------------
Telephone Number 000-000-0000
------------
Permissible Investments
The assets of the Plan shall be invested only in those investments described
below (To be completed by the Prototype Sponsor):
Assorted mutual funds, brokerage accounts and related investments
-----------------------------------------------------------------
--------------------------------------------------------------------------------
SECTION 20. TRUSTEE OR CUSTODIAN
--------------------------------------------------------------------------------
Option A: [X] Financial Organization as Trustee or Custodian
/s/ X. Xxxxxxx
X. XXXXXXX Check One: [_] Custodian, [X] Trustee without
full trust powers,
or [_] Trustee with full trust powers
Financial Organization Xxxxx Xxxxxx Corporate Trust Company
------------------------------------
Signature
Type Name
Collective or Commingled Funds
List any collective or commingled funds maintained by the financial organization
Trustee in which assets of the Plan may be invested:
(Complete if applicable) Collective trust funds of Xxxxx Xxxxxx and The
----------------------------------------------
Travelers.
----------
Option B: [_] Individual Trustee(s)
Signature Signature
Page 17
Type Name Type Name
Signature Signature
Type Name Type Name
Page 18
--------------------------------------------------------------------------------
SECTION 21. RELIANCE
--------------------------------------------------------------------------------
The Employer may not rely on an opinion letter issued by the National Office of
the Internal Revenue Service as evidence that the Plan is qualified under
Section 401 of the Internal Revenue Code. In order to obtain reliance with
respect to plan qualification, the Employer must apply to the appropriate Key
District office for a determination letter.
This Adoption Agreement may be used only in conjunction with Basic Plan Document
No. 04.
--------------------------------------------------------------------------------
SECTION 22. EMPLOYER SIGNATURE
Important: Please read before signing
--------------------------------------------------------------------------------
I am an authorized representative of the Employer named above and I state the
following:
1. I acknowledge that I have relied upon my own advisors regarding the
completion of this Adoption Agreement and the legal tax implications of
adopting this Plan.
2. I understand that my failure to properly complete this Adoption Agreement
may result in disqualification of the Plan.
3. I understand that the Prototype Sponsor will inform me of any amendments
made to the Plan and will notify me should it discontinue or abandon the
Plan.
4. I have received a copy of this Adoption Agreement and the corresponding
Basic Plan Document.
Signature for Employer Date Signed
Type Name Title
