403(b)(7) and Single Loan Application Booklet

Transcription

1 Retirement 403(b)(7) and Single Loan Application Booklet KSM Not FDIC Insured May Lose Value Not Bank Guaranteed OppenheimerFunds is not undertaking to provide impartial investment advice or to provide advice in a fiduciary capacity.

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3 Loan Application and Agreement For 403(b)(7) and Single K SM Plans Instructions Questions? Please call Please check with your employer regarding loan eligibility and approvals required to process this request. If you are age 70½ or older, you are not eligible to take a loan under the OppenheimerFunds Loan Terms and Conditions. Please print clearly. To receive your loan in a timely manner, please complete all sections. Please retain the Terms and Conditions for your records and send all pages of the Loan Application and Agreement, completed and signed, to OppenheimerFunds Distributor, Inc. To Custodian/Trustee of the OppenheimerFunds 403(b)(7) Plan or Single K SM Plan: I hereby submit this Loan Application and Agreement to borrow under my OppenheimerFunds 403(b)(7) Custodial Account or OppenheimerFunds Single K SM Account. I have read the Terms and Conditions. Remember: If you have previously defaulted on a loan from any other plan with the same employer, you will not be eligible for a loan from your OppenheimerFunds Plans Assets. Loans on Class B and C shares may be subject to a contingent deferred sales charge (CDSC) as outlined in the prospectus. Repayments on loans from Class C shares will restart the CDSC period and applicable commissions to the broker of record will be paid. Please see fund prospectuses and SAIs for additional information. Upload Forms Online: oppenheimerfunds.com/upload Fax: Regular Mail: P.O. Box 5390 Denver, CO Overnight Mail: 1 OppenheimerFunds Services 6803 S. Tucson Way Centennial, CO Account information Type of Plan (choose only one): 403(b)(7) Single K First name Middle initial Last name Mr. Mrs. Ms. Social Security Number Date of birth (mm/dd/yyyy) Contact (select one): Me My advisor Either ( ) Contact phone number 2 Loan amount The minimum loan amount is $1,500 per Plan Asset type (Traditional and/or Roth). You may borrow up to the lesser of 50% of your Plan Assets subject to certain IRS restrictions. 2 The $50,000 limit may be further reduced if you previously borrowed from your 403(b)(7) or Single K Plan. Loans must be made in $100 increments. Please see the Terms and Conditions for details. How much do you want to borrow? Maximum Loan Amount OR Specific Dollar Amount $ 2. If you have other 403(b)(7) or Single K accounts with this employer, it is important to note that the loan limits imposed under IRC Section 72(p) apply to all plans of the employer. Thus, you must take care to avoid multiple loans that, collectively, would exceed the overall limit. 1. Before December 10, 2017, please send overnight mail to OppenheimerFunds Services, E. Iliff Avenue, Suite 300, Aurora, CO OppenheimerFunds is not undertaking to provide impartial investment advice or to provide advice in a fiduciary capacity. RB Page 1 of 4

4 3 Loan duration Loans are generally paid back within one to five years. Only loans used to purchase a primary residence may have durations of up to 15 years. Please see the Terms and Conditions for details. If no selection is made here, the loan duration will be five years. You cannot modify your loan duration after submitting this application. All loans are repaid monthly. How long do you want your loan duration to be (choose one only)? My loan is a General Purpose loan and I would like the duration to be: 5 years Other: years (must be less than 5 years) My loan is a Primary Residence loan and I would like the duration to be: 5 years Other: years (maximum is 15 years and, if left blank, the default is 15 years) 4 Loan initiation fee* Please indicate from which of your Oppenheimer fund/account you want the $75* loan initiation fee deducted. Provide only one (1) Oppenheimer fund/account. Fund/Account number *For 403(b) plans in the state of Texas, the loan initiation fee is $50. 5 Loan withdrawal List the 403(b)(7) or Single K accounts from which you want the loan withdrawn. Please indicate the dollar or percentage of the loan amount you would like withdrawn from each account. From which Plan Assets would you like to take your loan? (Provide only a dollar amount or a percentage, not both.) Traditional Dollar Distribution: $ (must be $1,500 minimum) Fund/Account Dollar Amount or Percentage Roth Dollar Distribution: $ (must be $1,500 minimum) Fund/Account Dollar Amount or Percentage Both Plan Asset types. Please complete both sections above. Note: If you need additional space for more accounts, please attach a list on a separate page. RB Page 2 of 4

5 6 Loan receipt instructions How would you like to receive your loan? If no option is selected, we will default to sending your loan through Automatic Clearing House (ACH) methods. I want my loan to be sent to my bank account through ACH methods. My loan will be sent to the bank account associated with the attached preprinted voided check or deposit slip below. Unless this document bears a valid original Medallion Signature Guarantee stamp, loan proceeds to your new bank account will not be permitted for 10 calendar days following our receipt of this form/application. For security purposes, redemption requests accompanying a newly added bank account will not be processed or accepted during the 10-day waiting period. Such requests can be submitted to us either in writing, over the phone, or on our website after the 10-day waiting period has expired. As alternatives, loan proceeds sent via overnight check or to a preexisting bank account can be requested prior to the end of the 10-day waiting period. If you don t want your loan to go ACH, please indicate your preference below. Send a check to the address listed on my account. Overnight my check (please provide the OppenheimerFunds account from which to deduct the overnight fee). Fund/Account number Send my check to a new address, listed below. (Signature guarantee required.) Street address City State Zip 7 Loan repayment instructions You must select an OppenheimerFunds account for each Plan Asset type used for your loan. Loan amounts taken from Traditional Plan Assets must be repaid to a Traditional account and loan amounts taken from Roth Plan Assets must be repaid to a Roth account. Include a preprinted voided check or deposit slip. We cannot establish repayment without pertinent bank information. Your bank account will be debited on the first business day of the month. Please allow 10 days to process the initial debit from your bank account. To what Oppenheimer fund/account would you like your repayments to go and from what personal bank account do you want your repayments to be drafted? Both sections A and B must be completed. If you do not have a financial advisor associated with a FINRA registered broker-dealer on your account(s), beginning December 4, 2017, any loan repayment made to these accounts will be invested in Class A shares, without a sales charge (Class A NAV). A. Please list the Oppenheimer fund/account number you want your loan payments to go into. If your loan has come from both Traditional Plan Assets and Roth Plan Assets, please list a separate fund/account number for each Plan Asset type. If you currently invest in only one (1) Oppenheimer fund/account, we will default to that one unless otherwise indicated. If you would like to have your repayments go into a new fund, please write in the name of the new fund. Traditional Repayment Account Fund/Account number Roth Repayment Account Fund/Account number B. Bank Account Information. Please select the back account from which your loan repayments will be drafted. Checking account. If drafting from your Checking account, please attach a preprinted voided check. Savings account. If drafting from your Savings account, please attach a preprinted deposit slip. Attach your voided preprinted check/deposit slip. This bank account will be credited with your loan proceeds and debited monthly for your loan repayment. RB Page 3 of 4

6 8 Loan note and signatures I hereby certify that I have received and read the Terms and Conditions of the OppenheimerFunds 403(b)(7) Custodial Account and Single K Account. I understand that I will pay a $75* loan initiation fee. I hereby promise to pay to the order of the Lender (the Loan Feature word Lender means OFI Global Trust Company as Custodian/Trustee of the OppenheimerFunds 403(b)(7) or Single K Plan), the principal sum specified in Item 2 of this application (referred to as the Loan Amount), with interest on the principal balance remaining from time to time unpaid at the per annum rate, in consecutive, equal monthly installments of principal and interest beginning one month after receipt of the Loan Amount and continuing thereafter until paid (according to the Disclosure Statement that will be sent to me after my loan is made). All payments shall be applied first to the payment of interest due hereunder and second to unpaid principal of the Loan Amount. All payments will be sent to OppenheimerFunds. This agreement is being made pursuant to and shall be governed by the terms of the OppenheimerFunds 403(b)(7) and Single K Document and the Terms and Conditions which are hereby incorporated herein by reference, and the determination of whether a failure to pay any installment of the principal and interest when due in accordance with the terms of this agreement constitutes a default shall be determined according to the terms of the Custodial Agreement and Plan Document and the Terms and Conditions. I certify that by signing and submitting this application, I understand and signify my agreement to borrow money in the amount and according to all other terms set forth on this application and the Terms and Conditions. I have received a copy of this Agreement and the Terms and Conditions. I understand that an OppenheimerFunds Loan Disclosure Statement will be sent to me with specific information about my loan and the repayment obligation. Should this form be signed electronically, I acknowledge and agree that such electronic signature is valid evidence of my consent to be legally bound by this form and such subsequent terms as may govern this form. The electronic image of this form is considered to be the true, complete, valid, authentic and enforceable record of the form, admissible in judicial or administrative proceedings to the same extent as if the documents and records were originally generated and maintained in printed form. I agree not to contest to the admissibility or enforceability of the electronic copy of this form. Requests that require a Signature Guarantee cannot be signed electronically and must be hand-signed. Please note that any OppenheimerFunds-affiliated entity reserves the right and discretion to require additional documentation to process this form. A broker-dealer or financial advisor must be listed on the account in order for us to accept an electronically signed form. I have read and understand all terms of the Agreement which include the provisions included with this agreement, and I agree to be bound by them. I further certify that I do not have any outstanding loans in this or any other retirement plan with the same employer that are either already in excess of or will be in excess of the maximum loan limitations upon commencement of this loan request as set forth in Section 72(p) of the Internal Revenue Code. I waive any and all obligations the Lender may have to present this Agreement for payment, to make demand for payment, or to give notice of dishonor. I agree that this loan is made in the State of New York and that the provisions of this Agreement will be interpreted according to New York law. If I am in default, this Agreement may be enforced in any New York court that has jurisdiction and I agree to submit to the jurisdiction of that court regardless of where this Agreement is signed. I agree to pay any tax or fee charged by any governmental body in connection with this loan. X Applicant s Signature Date A signature guarantee is required if you would like your loan proceeds mailed to a new address designated in Section 6. Signature Guarantee required for the following transactions. For more information, please visit oppenheimerfunds.com/signatureguarantee ALL loans not being sent to the address listed on your account If registration on your account has changed within the last 15 days Loan proceeds to new bank account added within 10 calendar days of our receipt of this form. *For 403(b) plans in the State of Texas, the loan initiation fee is $50. Signature Guarantee Stamp 9 Employer/Plan Administrator/Third Party Administrator 403(b)(7) Plans: Your employer or your employer s third party administrator s authorization may be required. Please be sure to check with your employer regarding the plan s loan rules. Single K Plans: Your plan administrator s authorization is required. The plan administrator should sign in their capacity. Employer, Plan Administrator, or Third Party Administrator Signature Title Date 10 Checklist Did you select the duration for your loan? Did you select the account from which to deduct the loan initiation fee? Do the dollar amounts or percentages in Section 5 total 100% of your total requested loan amount per Plan Asset type? Did you select the accounts(s) for your loan repayments to go into? Did you enclose a preprinted voided check or deposit slip? Please do not staple. Are all required signatures/authorizations on the application? RB Page 4 of 4

7 OppenheimerFunds Loan Option Terms and Conditions Please keep the following pages for your records.

8 OppenheimerFunds OppenheimerFunds Loan Terms and Conditions for 403(b)(7) and Single K Plans Loan Features As an OppenheimerFunds 403(b)(7) Custodial and/or Single K account owner, you have the ability to borrow from your Plan Assets in accordance with the following Terms and Conditions: Note: If you are requesting a loan from both your OppenheimerFunds 403(b)(7) and Single K Plans, you must complete a separate application per Plan. All capitalized words are defined in the glossary at the end of these Terms and Conditions. Eligibility You may be eligible for an OppenheimerFunds loan if all of the following conditions are met: Your employer s Plan permits loans. You are a current employee of the employer sponsoring the Plan. You have not previously defaulted on a loan under your employer s Plan at OppenheimerFunds. You are under the age of 70½. You do not have two (2) outstanding loans with OppenheimerFunds at this time within your employer s OppenheimerFunds Plan. You have not taken a loan from your employer s OppenheimerFunds Plan in the current calendar year. Maximum amount You may borrow the lesser of: $50,000 reduced by the highest outstanding loan balance during the last 12-month period at the time you apply for an additional loan, or 50% of your Plan Assets. OppenheimerFunds will calculate only on the assets held here and those which have cleared escrow. All money types contributed to OppenheimerFunds under your Plan are included. Your loan proceeds may be taken from your Roth Plan Assets, Traditional Plan Assets, or a combination of both. OppenheimerFunds does not track any vesting schedule your employer may have in place. If the employer is using a vesting schedule, they must verify that the amount you are requesting for your loan is available. OppenheimerFunds will calculate and round down your available loan amount to the nearest $100. You must refer to your employer or their authorized agent to determine loan eligibility and maximum amount permitted. Minimum amount The minimum loan amount available is $1,500 per Plan Assets. If you are combining your Plan Assets, you must take a minimum of $1,500 from the Roth Plan Assets and $1,500 from the Traditional Plan Assets. Interest rate The interest rate is the federal prime interest rate plus 2% on the day prior to your loan s approval. Your loan s interest rate is fixed over the duration of your loan. All interest paid is reinvested into your Plan Assets. Loan procedure Upon receiving a negotiable loan application, the following will occur: OppenheimerFunds will process the redemption and send the proceeds directly to your bank via Automatic Clearing House (ACH) methods, unless otherwise instructed. An initiation fee of $75* will be taken at the time the redemption is processed. Your signature on the loan application is your agreement to abide with all terms and conditions of the loan. You will receive a Loan Disclosure Statement documenting all pertinent information regarding your loan. This will be sent separately from the proceeds. Your Loan Disclosure Statement will outline: Your initial repayment date, which is the 1st of the month occurring 30 days from the issuance of your loan proceeds. Your monthly payment amount. Your annual interest rate. Loan duration The duration of your loan must not exceed five (5) years unless your loan is being used to purchase your principal residence. No loan duration may extend past the attainment of age 70½. Therefore, your loan duration may be less than 5 years. Principal residence loans may have durations of up to 15 years. * For 403(b) plans in the State of Texas, the loan initiation fee is $50.

9 The Right Way to Invest You may have only one (1) principal residence loan outstanding at a time with OppenheimerFunds. If electing a duration greater than five (5) years, the minimum monthly loan payment must be $25. Impacts on your loan based on your plan assets share class 1 Class A Shares: If you distribute your loan proceeds from Plan Assets invested in loaded A shares (a sales charge has been paid upfront), your loan repayments will purchase A shares at Net Asset Value (NAV) (no additional sales charges assessed). If your loan proceeds originated from OppenheimerFunds Money Market Fund or Cash Reserves Class A account and the shares were unloaded (no upfront sales charges were assessed), your loan repayments will be subject to any applicable sales charges upon reinvestment. Class B Shares: If you distribute your loan proceeds from Plan Assets in Class B shares, you will be subject to Contingent Deferred Sales Charges (CDSC) as set forth in the prospectus and your loan repayments must be repaid into Class A shares at NAV. Class C Shares: If you distribute your loan proceeds from Plan Assets invested in Class C shares, you will be subject to CDSC as set forth in the prospectus and your loan repayments must be repaid into Class C shares. The repayments are treated as new purchases. Class R Shares: If you distribute your loan proceeds from Plan Assets held in Class R shares, your loan payments will be repaid into Class R shares and are not subject to a CDSC. Repayment 1 You must maintain a U.S. address for the duration of your loan. Your repayments will be drafted directly from your bank account (checking or saving) on the first day of each month. If you take a loan from both your Roth Plan Assets and Traditional Plan Assets, your bank account will be drafted twice. Your payments will be posted into the fund you select on your loan application. You may only select one of your funds for reinvestment of your loan repayments. You may change the fund for your reinvestments by notifying OppenheimerFunds. You must notify OppenheimerFunds, upon a full exchange into a new fund, if you want the repayments to post into your new fund. You will not be permitted to renegotiate outstanding loans or consolidate multiple loans into one aggregate loan. You must remit all late payments, via ACH, in full. You may submit additional payments which will be applied toward the principal of your loan and will reduce the duration of your loan. Additional payments can be received via ACH or by check. You must repay or Offset any outstanding loan balance in full by the time you attain age 70½. In the event of your death, if your sole beneficiary is your spouse, he/she has the right to repay your outstanding loan obligation in full within 90 days. Your loan must be paid in full or Offset upon termination of your employer s Plan. If opting to offset your loan, the offset amount will be subject to mandatory 20% withholding. Default Your loan will be considered in default if you incur three (3) missed consecutive payments. No extensions are permitted. You will receive a notice indicating your loan is in default. Your outstanding loan balance is considered, at that time, to be a reportable distribution and reported to the IRS on Form 1099-R. You may be subject to taxes and premature withdrawal penalties. You will be ineligible to obtain any subsequent loans from OppenheimerFunds if you default. If you default on your loan repayments, you will be subject to taxation on the entire amount of the outstanding balance and may jeopardize the tax-exempt status of your Plan Assets. Distributions with an outstanding loan You may take a distribution while you have an outstanding loan if you have any one of the following qualified distribution reasons. Note: Your loan must remain Secure. Financial hardship Disability In-service withdrawal if you are age 59½ or over (must be permitted by the Plan) Separation of Service Excess IRS levy You must continue to repay the loan after a qualified distribution. In the event of your death: If your beneficiary is your spouse, they may elect to repay, in a lump sum, the outstanding loan amount or Offset the outstanding loan amount within 90 days. If your beneficiary is not your spouse, the balance of your outstanding loan will be reported as a distribution under your Social Security number. 1. If you do not have a financial advisor associated with a FINRA registered broker-dealer on your account(s), beginning December 4, 2017, any loan repayment made to these accounts will be invested in Class A shares, without a sales charge (Class A NAV).

10 OppenheimerFunds Divorce In all situations involving divorce, it is your responsibility to continue to make loan repayments in accordance with the terms of this agreement. If your Plan Assets are to be divided pursuant to a properly executed Qualified Domestic Relations Order (QDRO): The separation of Plan Assets may not be permitted if it would cause your loan to become unsecured. You may be required to provide the following items in order to negotiate on your Plan Assets: A copy of your QDRO. A letter of authorization from your employer or their authorized agent concerning your Plan Assets being assigned to your spouse. Letters of instruction from both you and your ex-spouse. The letters must be signature guaranteed. If you are currently in the middle of a divorce, distributions will be restricted until your divorce is finalized. If your Plan Assets are not to be divided pursuant to a properly executed QDRO: A letter of instruction may be required stating your assets are not part of your divorce negotiations. Loan transfers Transfer into OppenheimerFunds You may transfer your loan obligation(s) under your current employer s Plan from one custodian/trustee to OppenheimerFunds. Your loan must be in current standing at the resigning custodian/trustee. The resigning custodian/trustee must provide the following information to OppenheimerFunds: The interest rate used to calculate the loan. The origination date of the loan. The type of loan (residential or other). The original loan amount. The loan balance at the time of transfer. The number of payments remaining on the loan. The highest outstanding loan balance within the last 12 months. You will be required to sign a new loan application with OppenheimerFunds. You will need to complete a loan application for each loan you are transferring. You will need to complete for each loan you are transferring a Loan Transfer Form. You will be assessed a loan initiation fee of $75* per loan being transferred. Your repayments will be done via ACH. Your payment may increase with a transfer in to compensate for the transfer time in relation to the duration of your loan. You may only transfer two outstanding loans at a time. Transfer from OppenheimerFunds You may transfer your loan obligation(s) to a new custodian/trustee from OppenheimerFunds. Your loan must be in current standing at OppenheimerFunds before transferring to the receiving custodian/trustee. Your accepting custodian/trustee must submit, in writing, to OppenheimerFunds an acceptance of the loan obligation(s). OppenheimerFunds will provide detailed information on your loan(s) to the accepting custodian/trustee. Plan termination Upon termination of your employer s Plan, your outstanding loan balance must be paid in full or it will be reported as a distribution on IRS Form 1099-R. You may be subject to taxes and premature withdrawal penalties. Disclaimer Current tax regulations proved that a loan from a 403(b)(7) or Single K account will not adversely affect the tax-exempt status of the account or be treated as a taxable distribution, provided the loan amount is within the maximum amount permitted by the Plan and repayments are made strictly in accordance with the loan documents. However, neither OppenheimerFunds Distributor, Inc., its affiliates, the Oppenheimer funds (collectively, OppenheimerFunds ) nor the Plan Custodian/Trustee assume any responsibility or liability for any adverse tax consequences incurred by an account owner as a result of a loan from the Plan. Account owners who desire to borrow from their accounts should confer with their attorneys or tax advisors before entering into a loan agreement. OppenheimerFunds reserves the right to amend, modify or terminate the 403(b)(7)/Single K loan provision at any time, without prior notice, to impose additional requirements and to refuse a loan to any account owner at its sole discretion. Glossary When used in these Terms and Conditions with capital letters, the following words and phrases have the meanings set forth below unless the context indicates that other meanings are intended. Plan Means the OppenheimerFunds 403(b)(7) or Single K established by your employer for retirement savings. Plan Assets Means the accounts created for your benefit under your employer s Plan for accumulating your investments in the Plan. Offset Means reporting an outstanding loan balance as a qualified distribution. At the time of Offset, the distributable amount will be subject to 20% mandatory withholding. Default Means reporting the outstanding loan balance as a premature distribution. Secure Loan Means you must keep an amount in your Plan Assets equal to your outstanding loan balance.

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12 At OppenheimerFunds, we understand that sometimes unexpected circumstances or emergencies can lead to your requiring a loan. Though you may want to consider other sources before drawing on your retirement savings, your OppenheimerFunds 403(b)(7) or Single K SM Plan does allow you to borrow from your account, while maintaining its favor able tax status. To learn more about our loan application process, please review the details inside. Visit Us oppenheimerfunds.com Call Us Follow Us Shares of Oppenheimer funds are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including the possible loss of the principal amount invested. This material is provided for general and educational purposes only, is not intended to provide legal or tax advice, and is not for use to avoid penalties that may be imposed under U.S. federal tax laws. OppenheimerFunds is not undertaking to provide impartial investment advice or to provide advice in a fiduciary capacity. Contact your attorney or other advisor regarding your specific legal, investment or tax situation. Before investing in any of the Oppenheimer funds, investors should carefully consider a fund s investment objectives, risks, charges and expenses. Fund prospectuses and summary prospectuses contain this and other information about the funds, and may be obtained by asking your financial advisor, visiting oppenheimerfunds.com or calling CALL OPP ( ). Read prospectuses and summary prospectuses carefully before investing. Oppenheimer funds are distributed by OppenheimerFunds Distributor, Inc. 225 Liberty Street, New York, NY OppenheimerFunds Distributor, Inc. All rights reserved. RB November 30, 2017