PORTLAND COMMUNITY COLLEGE TAX-DEFERRED ANNUITY

Transcription

1 PORTLAND COMMUNITY COLLEGE TAX-DEFERRED ANNUITY Amended and Restated Effective January 1, 2009

2 TABLE OF CONTENTS ARTICLE I - PLAN Name of Plan Plan Documents Records of Current and Former Vendors Cessation of Eligibility to Receive Contributions 2 ARTICLE II - DEFINITIONS Code College Contracts Death Beneficiary Hours of Service Includible Compensation Plan Administrator Plan Year Related Employer Severance from Employment Valuation Date Vendor Year of Service 7 ARTICLE III - ELIGIBILITY AND PARTICIPATION Eligibility Commencement of Participation Cessation of Participation Effective Opportunity to Participate 9 ARTICLE IV - ELECTIVE CONTRIBUTIONS Elective Contributions Applicable Dollar Limitation Age 50 Catch-Up Elective Contributions Special Rule for a Participant Covered by Another 403(b) Plan Correction of Excess Elective Contributions Reduction of Elective Contributions Military Service Death of Participant During Qualified Military Service 12 Page i -

3 TABLE OF CONTENTS (continued) ARTICLE V - COLLEGE CONTRIBUTIONS Amount Allocation of College Contributions Annual Addition Limitation 15 ARTICLE VI - ROLLOVER CONTRIBUTIONS General Definition of Rollover Contribution Conditions Distributions 17 ARTICLE VII - NONFORFEITABLE RIGHTS Fully Vested Accounts Lost Payees 18 ARTICLE VIII - DISTRIBUTIONS Benefit Payments Distributable Events Payments to Minors and Incapacitated Persons Eligible Rollover Distributions Required Distribution Rules 21 ARTICLE IX - PLAN LOANS AND HARDSHIP WITHDRAWALS Plan Loans Hardship Withdrawals 27 ARTICLE X - ASSIGNMENT AND ALIENATION General Domestic Relations Orders Tax Withholding 29 ARTICLE XI - FUNDING AND INVESTMENT OF PLAN ASSETS Funding Investment of Accounts 30 Page ii -

4 TABLE OF CONTENTS (continued) ARTICLE XII - PLAN ADMINISTRATION General Powers Notice to Plan Administrator Retention of Legal Counsel, Accountants, and Consultants Limitation of Liability and Indemnification Administrative Expenses 32 ARTICLE XIII - GENERAL PROVISIONS Employment Governing Law Gender and Number Limitation of Rights Benefit Responsibility Settlement of Disputes 33 ARTICLE XIV - AMENDMENT AND TERMINATION Amendment Termination Distributions on Plan Termination 34 EXHIBIT A - VENDORS A-1 EXHIBIT B - COLLEGE CONTRIBUTIONS B-1 Page iii -

5 PORTLAND COMMUNITY COLLEGE TAX-DEFERRED ANNUITY AMENDED AND RESTATED Effective January 1, 2009 P A R T Y THIS AMENDED AND RESTATED PLAN is adopted by Portland Community College District, hereinafter referred to as the College. R E C I T A L S Effective July 1, 1969, the College established the Portland Community College Tax-Deferred Annuity ( Plan ) under Section 403(b) of the Internal Revenue Code of 1986, as amended, for its eligible employees. The Plan was last amended and restated effective June 1, 1998 and was last amended effective January 1, The College desires to further amend and restate the Plan. A M E N D M E N T A N D R E S T A T E M E N T The Portland Community College Tax-Deferred Annuity is hereby amended and restated as set forth herein effective January 1, 2009, with specific provisions effective as of such earlier or later date as provided herein or as necessary to maintain continued compliance with applicable federal law

6 ARTICLE I PLAN 1.1 Name of Plan. The Plan shall be known as the Portland Community College Tax-Deferred Annuity. 1.2 Plan Documents. The Plan shall consist of the provisions set forth in this document, together with the provisions of the Contracts. The terms of the Contracts are hereby incorporated by reference into the Plan, excluding any terms that are inconsistent with this Plan document or Code Section 403(b) and the regulations issued thereunder. 1.3 Records of Current and Former Vendors. The Plan Administrator shall maintain a list of all Vendors under the Plan, and that list is hereby incorporated as part of the Plan. The Vendors and the Plan Administrator shall exchange such information with each other as may be necessary to satisfy Code Section 403(b) or other requirements of applicable law. The Plan Administrator shall keep all Vendors (including any Vendor that has ceased to be eligible to receive contributions under the Plan) informed of the Plan Administrator s name and contact information in order to coordinate the exchange of information necessary to satisfy Code Section 403(b) or other requirements of applicable law. The current and former Vendors under the Plan shall be listed on Exhibit A, which is attached hereto and incorporated by this reference herein. The Plan Administrator may update Exhibit A from time to time to reflect changes in the Vendors without a formal amendment to this Plan. 1.4 Cessation of Eligibility to Receive Contributions. If any Vendor ceases to be eligible to receive contributions under the Plan, the College will enter into an information sharing agreement to the extent that the Contracts with that Vendor do not provide for the exchange of information described in this section. Under the information sharing agreement, the College and the Vendor will agree to provide each other with the following information: (a) Information necessary for the Vendor s Contracts, and any other annuity contract or custodial accounts to which Plan contributions have been made, to satisfy Code Section 403(b), including the following: (i) The College shall provide information as to whether a Participant s employment with the College is continuing, and shall notify the Vendor when a Participant has had a Severance from Employment for purposes of the distribution restrictions in 8.2. (ii) The Vendor shall notify the College of any hardship withdrawal that results in a six-month suspension of the Participant s right to make elective contributions under the Plan. (iii) The Vendor shall provide information to the College or other Vendors concerning a Participant s or Death Beneficiary s annuity contracts, custodial accounts, or qualified employer plan benefits, to enable a Vendor to determine the amount of any plan loans and any rollover accounts that are

7 available to the Participant to satisfy a financial need for which a hardship withdrawal is requested. (b) Information necessary for the Vendor s Contracts, and any other annuity contract or custodial account to which Plan contributions have been made, to satisfy other tax requirements, including the following: (i) The amount of any plan loan that is outstanding to a Participant, to enable a Vendor to determine whether an additional plan loan will comply with the loan limitations of 9.1(c). (ii) Information concerning a Participant s or Death Beneficiary s after-tax employee contributions, to enable a Vendor to determine the extent to which a distribution is includible in gross income

8 ARTICLE II DEFINITIONS Throughout this Plan, the following terms shall have the following meanings when used with initial capital letters: codes thereto. 2.1 Code. The Internal Revenue Code of 1986, as amended, and successor 2.2 College. The Portland Community College District. 2.3 Contracts. The contracts or other agreements governing annuity contracts and custodial accounts, as defined in this section, that are issued for the purpose of funding amounts held under the Plan and that are specifically approved by the Plan Administrator for use under the Plan. (a) Annuity Contract. A nontransferable contract, as defined in Code Section 403(b)(1), issued by an insurance company that is qualified to issue annuities in the state of Oregon, and that includes payment in the form of an annuity. (b) Custodial Account. A group or individual custodial account, as defined in Code Section 403(b)(7). 2.4 Death Beneficiary. The person or persons who are entitled to receive the Participant s benefits in the case of the Participant s death. Except as otherwise required by the terms of a distribution option elected by the Participant, the full amount of any remaining portion of a deceased Participant s accounts will be payable to the Death Beneficiary in a lump sum. Each Participant may designate one or more Death Beneficiaries in accordance with the terms of the applicable Contract or Contracts under which the Participant s accounts are invested. The following rules shall apply to the extent they are not inconsistent with the provisions of an applicable Contract: (a) A Death Beneficiary designation shall not be effective unless it is made in writing and filed with the Plan Administrator or the appropriate Vendor during the Participant s lifetime, in accordance with the procedures established by the Plan Administrator. (b) If a Participant does not make an effective Death Beneficiary designation, or if the designated Death Beneficiary does not survive the Participant, the Death Beneficiary is the Participant s surviving spouse or, if there is no surviving spouse, the Participant s estate. (c) If a Participant designates his or her spouse as a Death Beneficiary and the Participant s marriage to that spouse is later dissolved, the designation of the former spouse as a Death Beneficiary shall be void unless the Participant submits a subsequent designation naming the former spouse as the Death Beneficiary. Notwithstanding the

9 foregoing, the Participant s Death Beneficiary designation shall remain in effect to the extent required by a domestic relations order, as defined in Service for: 2.5 Hours of Service. An employee shall be credited with one Hour of (a) Each hour for which the employee is paid, or entitled to payment, for the performance of duties for the College or a Related Employer during the applicable computation period. (b) Each hour for which the employee is paid, or entitled to payment, by the College or a Related Employer on account of a period of time during which no duties are performed (irrespective of whether the employment relationship has terminated) because of vacation, holiday, illness, incapacity (including disability), layoff, jury duty, military duty, or leave of absence, except that: (i) No more than 501 Hours of Service are required to be credited under this subsection to an employee on account of any single continuous period during which the employee performs no duties (whether or not such period occurs in a single computation period); (ii) An hour for which an employee is directly or indirectly paid, or entitled to payment, on account of a period during which no duties are performed, is not required to be credited to the employee if the payment is made or due under a plan maintained solely for the purpose of complying with applicable workers compensation, unemployment compensation, or disability insurance laws; and (iii) Hours of Service are not required to be credited for a payment that solely reimburses an employee for medical or medically related expenses incurred by the employee. For purposes of this subsection (b), a payment shall be deemed to be made by or due from the College or a Related Employer regardless of whether such payment is made by or due from the College or a Related Employer directly or indirectly through a trust fund, insurer, or other entity, to which an Employer contributes or pays premiums, and regardless of whether contributions made or due to the trust fund, insurer, or other entity are for the benefit of particular employees or are on behalf of a group of employees in the aggregate. (c) Each hour for which back pay, irrespective of mitigation of damages, is either awarded or agreed to by the College or a Related Employer. The same Hours of Service shall not be credited both under subsection (a) or subsection (b), as the case may be, and under this subsection (c). The determination of Hours of Service for reasons other than the performance of duties and the crediting of Hours of Service to computation periods shall be in accordance with Department of Labor Regulation b-2(b) and (c)

10 2.6 Includible Compensation. (a) Basic Definition. An employee s actual wages in box 1 of Form W-2 for a year for services to the College, increased by any compensation reduction election under Code Section 125, 132(f), 401(k), 403(b), or 457(b) (including any elective contribution under the Plan). The amount of an employee s Includible Compensation is determined without regard to any community property laws. Includible Compensation shall include any differential wage payment, as defined in Code Section 3401(h)(2), that is paid by the College to the employee. If the College makes any differential wage payment during a Plan Year, all differential wage payments made during that Plan Year must satisfy the nondiscrimination requirements of Code Section 414(u)(12)(C). (b) Post-Severance Payments. Amounts that are paid after an employee s Severance from Employment shall not be included in the employee s Includible Compensation, except as otherwise provided in paragraphs (i), (ii), (iii), and (iv) below. (i) Back Pay. Back pay, within the meaning of Treasury Regulation 1.415(c)-2(g)(8), shall be included in the employee s Includible Compensation for the Plan Year to which the back pay relates, to the extent that it otherwise satisfies the basic definition of Includible Compensation in (a) above. (ii) Regular Pay. Includible Compensation shall include regular pay for services during the employee s regular working hours, or payment for services outside the employee s regular working hours (such as overtime or shift differential), commissions, bonuses, or other similar payments, provided that: (A) Absent a Severance from Employment, the payment would have been made while the employee continued in employment with the College; (B) The payment otherwise satisfies the basic definition of Includible Compensation in (a) above; and (C) The payment is paid to the employee by the later of 2½ months after the employee s Severance from Employment or the end of the Plan Year in which the employee had the Severance from Employment. (iii) Accrued Vacation Cashouts. Includible Compensation shall include payments for unused accrued bona fide vacation leave, provided that: (A) The employee would have been able to use the leave if his or her employment had continued; (B) The payment otherwise satisfies the basic definition of Includible Compensation in (a) above; and (C) The payment is made to the employee by the later of 2½ months after the employee s Severance from Employment or the end of the Plan Year in which the employee had the Severance from Employment

11 (iv) Differential Wage Payments. Includible Compensation shall include any differential wage payments, as defined in (a) above. (c) Dollar Limitation. The amount of a Participant s Includible Compensation that is taken into account under this Plan for any Plan Year shall be limited to $200,000, plus cost-of-living adjustments permitted under applicable law ($245,000 effective January 1, 2009). If any period over which Includible Compensation is determined ( determination period ) consists of fewer than 12 months, the applicable dollar limitation determined under this section shall be multiplied by a fraction, the numerator of which is the number of months in the determination period, and the denominator of which is Plan Administrator. The person, committee, or entity appointed by the College to administer the Plan in accordance with Article XII. In the absence of a different appointment, the College shall be the Plan Administrator. 2.8 Plan Year. The 12-month period beginning each January 1 and ending each December Related Employer. The College and any other entity that is under common control with the College under Code Section 414(b) or (c). For this purpose, the College shall determine which entities are Related Employers based on a reasonable, good faith standard and taking into account the special rules applicable under Internal Revenue Service Notice Severance from Employment. The termination of an employee s employment with the College and all other Related Employers Valuation Date. The Valuation Date shall be the dates as provided pursuant to the terms of the Contracts, and such other date or dates as may be designated by the Plan Administrator Vendor. The provider of an annuity contract or custodial account, as defined in 2.3, in which Plan assets are held and invested pursuant to a Contract Year of Service. A 12-consecutive-month period of employment, beginning the date employment commences in a classification identified in 3.1(b)

12 3.1 Eligibility. ARTICLE III ELIGIBILITY AND PARTICIPATION (a) Elective Contributions. Except as otherwise provided in (c), each employee of the College is eligible to participate in this Plan. For this purpose, an employee means an individual who performs services for the College as a common-law employee and an individual who is receiving differential wage payments, as defined in Code Section 3401(h)(2), from the College. (b) College Contributions. Except as otherwise provided in (c), each employee who the College classifies as an executive, management, or, effective September 12, 2002, confidential employee shall be eligible for College Contributions under Article V. (c) Excluded Employees. The following individuals shall not be eligible to participate in the Plan: (i) Employees who normally work fewer than 12 hours per week. For this purpose, an employee shall be treated as normally working fewer than 12 hours per week only if the following requirements are satisfied: (A) For the 12-month period beginning on the employee s employment commencement date, the College reasonably expects the employee to work fewer than 600 Hours of Service; and (B) For each Plan Year ending after the close of the 12-month period described in (A), the employee worked fewer than 600 Hours of Service in the preceding 12-month period. (ii) Student employees who are exempt from FICA taxation under Code Section 3121(b)(10). 3.2 Commencement of Participation. (a) Elective Contributions. An eligible employee may become a Participant by submitting a deferral election pursuant to 4.1(c)(i) on or after the date he or she first becomes an eligible employee or is rehired as an eligible employee. (b) College Contributions. (i) An employee who the College classifies as an executive employee shall become a Participant by establishing a Contract with a Vendor. (ii) An employee who the College classifies as a management or confidential employee shall become a Participant by completing one Year of Service and establishing a Contract with a Vendor. A Participant under this subsection (ii) who

13 terminates employment and is rehired as an employee classified by the College as a management or confidential employee shall resume participation by establishing a Contract with a Vendor. 3.3 Cessation of Participation. A Participant shall cease to be a Participant on death or on distribution of his or her accounts following Severance from Employment. 3.4 Effective Opportunity to Participate. The Plan Administrator shall provide each eligible employee with information about the Plan that is sufficient to give the eligible employee an effective opportunity to make elective contributions, as required by Treasury Regulation 1.403(b)-5(b)(2)

14 4.1 Elective Contributions. ARTICLE IV ELECTIVE CONTRIBUTIONS (a) General. Each eligible employee may elect to defer a portion of his or her Includible Compensation and have the College contribute it to the Plan instead of paying it to the Participant in cash. All elective contributions shall be made on a pre-tax basis. (b) Limitations on Elective Contributions. The Plan Administrator may establish a maximum percentage of Includible Compensation for elective contributions. Any maximum percentage limitation established by the Plan Administrator shall be memorialized in a written document and shall apply to all Participants. In addition to the maximum limitation established by the Plan Administrator, if any, no Participant s elective contributions for a Plan Year shall exceed the lowest of the following amounts: (i) The applicable dollar limitation under 4.2, plus any additional catch-up contribution allowed under 4.3; (ii) The Participant s Includible Compensation for the Plan Year; or (iii) The amount of the Participant s compensation that is available for deferral, after taking into account all other deductions from the Participant s compensation that are required by law or authorized or elected by the Participant. (c) Election Procedures. (i) New Elections. A Participant s election shall be effective on the first day of the payroll period beginning on or after the date on which the Plan Administrator receives the Participant s deferral election. (ii) Election Changes. Except as described in (iii) below, a Participant s deferral election, or failure to make a deferral election, shall be effective until it is changed by a new or changed deferral election delivered to the Plan Administrator. An election made under this subsection shall be effective on the first day of the payroll period after the election is submitted to the Plan Administrator. (iii) Stopping Elective Contributions. A Participant may elect to stop making elective contributions at any time, by delivering a written election to the Plan Administrator. An election to stop making elective contributions shall be effective on the first day of the payroll period after it is submitted to the Plan Administrator. The Plan Administrator may adopt procedures for new, change, or stop elections, and may require that in order to be effective, a written election must be received a certain number of days prior to the date it is to become effective. (d) Allocation of Elective Contributions. The College shall transfer each Participant s elective contributions to applicable Contract or Contracts within 15 business days

15 after the end of the month in which the amount would otherwise have been paid to the Participant. The Vendors shall separately account for each Participant s elective contributions made pursuant to this Article. 4.2 Applicable Dollar Limitation. (a) General Limitation. Subject to subsection (b) below, if applicable, the maximum amount of a Participant s elective contributions for a calendar year shall not exceed the applicable dollar limitation under Code Section 402(g)(1)(B) for the calendar year, including cost-of-living adjustments pursuant to Code Section 402(g)(4). The applicable dollar limitation for 2009 and 2010 is $16,500. (b) Special 403(b) Catch-Up Limitation for Employees With 15 Years of Service. Because the College is a qualified organization (within the meaning of Treasury Regulation 1.403(b)-4(c)(3)(ii)), the applicable dollar limitation under (a) for any qualified employee is increased (to the extent provided in the Contracts) by the additional amount described in this subsection (b). For purposes of this subsection (b), a qualified employee means an employee who has completed at least 15 years of service (as defined in Treasury Regulation 1.403(b)-4(e)), taking into account only employment with the College. The additional amount described in this subsection is the least of the amounts described in (i), (ii), or (iii) below: (i) $3,000. (ii) The excess of: (A) $15,000, over (B) The total amount of special 403(b) catch-up elective deferrals made for the qualified employee by the qualified organization for prior years. (iii) The excess of: (A) $5,000, multiplied by the number of the employee s years of service with the qualified organization, over (B) The total elective deferrals, as defined in Treasury Regulation 1.403(b)-2, made for the employee by the qualified organization for prior years. (c) Coordination of Catch-Up Limitations. Amounts in excess of the applicable dollar limitation in subsection (a) shall be allocated first to the special 403(b) catch-up rule described in subsection (b), if applicable, and next as an age 50 catch-up contribution under Age 50 Catch-Up Elective Contributions. All employees who are eligible to make elective contributions under this Plan and who will attain age 50 or more by the end of a calendar year shall be eligible to make catch-up contributions for the calendar year in accordance with, and subject to the limitations of, Code Section 414(v) and the regulations

16 thereunder. The catch-up contributions shall not be taken into account for purposes of the provisions of the Plan or the Contracts implementing the required limitations of Code Sections 401(a)(30), 403(b), and 415(c). The Plan shall not be treated as failing to satisfy the provisions of the Plan or the Contracts implementing the requirements of Code Section 403(b)(12), as applicable, by reason of the making of catch-up contributions under this section. 4.4 Special Rule for a Participant Covered by Another Section 403(b) Plan. If a Participant is or has been a participant in one or more other plans under Code Section 403(b) (or any other plan that permits elective deferrals as defined in Code Section 402(g)), then this Plan and all such other plans shall be considered as one plan for purposes of applying the provisions of 4.2 and 4.3. For this purpose, the Plan Administrator shall take into account any other such plan maintained by any Related Employer and shall also take into account any other such plan for which the Plan Administrator receives from the Participant sufficient information concerning his or her participation in such other plan. Notwithstanding the foregoing, another plan maintained by a Related Employer shall be taken into account for purposes of the special limitation described in 4.2(b) only if the other plan is a Code Section 403(b) plan. 4.5 Correction of Excess Elective Contributions. If a Participant has an excess deferral as described in Code Section 402(g) (an excess of elective contributions and other elective deferrals over the applicable dollar limitation), the amount of the excess deferral, adjusted for any allocable gain or losses during that taxable year, will be distributed to the Participant, in accordance with Treasury Regulation 1.403(b)-4(f) and Code Section 402(g)(2)(A). 4.6 Reduction of Elective Contributions. Notwithstanding any other provision of this Plan, the Plan Administrator may at any time and from time to time direct that the amount that would otherwise be contributed to the Plan as elective contributions on behalf of one or more Participants pursuant to their elections under 4.1 be reduced to the extent the Plan Administrator deems necessary to satisfy the limitations described in 4.2 and Military Service. Notwithstanding any provision of this Plan to the contrary, contributions, benefits, and service credit with respect to qualified military service will be provided in accordance with Code Section 414(u). An employee whose employment is interrupted by, or who is on a leave of absence for, qualified military service under Code Section 414(u) may elect to make additional elective contributions upon resumption of employment with the College. The maximum amount of additional elective contributions that may be made under this section shall be equal to the maximum elective contributions that the employee could have elected during the period of the interruption or leave if the employee s employment with the College had continued at the same level of Compensation during that period, reduced by the elective contributions, if any, actually made for the employee during the period of the interruption or leave. Except to the extent provided under Code Section 414(u), this right applies for five years following the employee s resumption of employment (or, if sooner, for a period equal to three times the period of the interruption or leave). 4.8 Death of Participant During Qualified Military Service. If a Participant dies on or after January 1, 2007, while performing qualified military service, as defined in Code Section 414(u), the survivors of the Participant shall be entitled to any additional

17 benefits (other than benefit accruals relating to the period of qualified military service) that would have been provided under this Plan if the Participant had resumed active employment and then terminated employment on account of death

18 5.1 Amount. ARTICLE V COLLEGE CONTRIBUTIONS (a) The College shall, subject to the limitations contained in 5.3 and except as provided in (c), make contributions at a rate equal to a specified percentage of the Includible Compensation of each eligible Participant. Such contribution rate will be determined by the College and may be equal to zero. The current rate for College contributions under this subsection is described on Exhibit B, which is attached hereto and incorporated by this reference herein. The Plan Administrator may update Exhibit B from time to time to reflect changes in the College contribution rate without a formal amendment to this Plan. (b) The College shall make additional College contributions for Dr. Preston Pulliams (the President ) in accordance with the following provisions: (i) Except as provided in (ii), (iii), or (iv) below, the College shall make additional College contributions totaling $120,000, on behalf of the President. The additional contributions shall be made during the calendar years listed below in accordance with the following schedule: 2009: $20, : $20, : $20, : $20, : $20, : $20,000 (ii) If the President s continuous employment with the College terminates for any reason before June 30, 2009, the College shall have no obligation to make contributions under this 5.1(b), and the President s interest in any contributions made under this section prior to the termination shall be permanently forfeited. (iii) If, because of federal tax limitations on contributions to the Plan, the College is unable to make the full contribution for one or more year under the schedule in (i) above, the contribution for each affected year shall be reduced so that it does not cause the Plan to exceed the contribution limitations. The amount by which the contribution was reduced shall be contributed in the first subsequent year in which that amount can be contributed without exceeding the federal limitations. (iv) If the President has a Severance from Employment with the College before all contributions have been made under (i), the remaining contributions shall be made only to the extent permitted by Internal Revenue Code Section 403(b)(3) and Treasury Regulation 1.403(b)-4(d). (c) The College shall not make or be required to make a contribution to an eligible employee under this 5.1 for any payroll period during which an eligible employee has not established a Contract with a Vendor

19 5.2 Allocation of College Contributions. College contributions under 5.1(a) shall be allocated to the Participant s applicable Contract(s) within a reasonable time after the end of the applicable payroll period, beginning with the first payroll period after the date the employee becomes a Participant under 3.2(b). College contributions under 5.1(b) shall be allocated to the President s Contract(s) within a reasonable time after the end of his last payroll period for the applicable calendar year. 5.3 Annual Addition Limitation. (a) Limitation. Notwithstanding any provision of the Plan or the Contracts, except to the extent permitted under 4.3 and Code Section 414(v), the annual addition with respect to a Participant s accounts for any Plan Year (the Plan Year is the limitation year) may not exceed the lesser of: (i) $40,000, plus cost-of-living adjustments permitted under applicable law ($49,000 effective January 1, 2009); or (ii) 100 percent of the Participant s Includible Compensation. (b) Annual Addition. For purposes of this section, annual addition means the sum of the following amounts allocated to a Participant s accounts as of any date within the Plan Year: (i) College contributions (including contributions made for the Participant by a Related Employer); (ii) (iii) Elective contributions; and Forfeitures

20 ARTICLE VI ROLLOVER CONTRIBUTIONS 6.1 General. Subject to prior approval by the College, a Vendor may, in its discretion, accept rollover contributions of cash on behalf of an eligible employee, the amount of which shall be credited to a separate rollover account maintained for the employee and shall at all times remain fully vested and nonforfeitable. 6.2 Definition of Rollover Contribution. A rollover contribution is: (a) An amount received by the Vendor from an eligible employee who, having received an eligible rollover distribution, as defined in Code Section 402(c)(4), from a qualified trust described in Code Section 401(a), a qualified annuity plan described in Code Section 403(a), an annuity contract described in Code Section 403(b), or an eligible plan described in Code Section 457(b) which is maintained by a state, a political subdivision of a state, or any agency or instrumentality of a state or a political subdivision of a state ( governmental Code Section 457(b) plan ), transfers any portion of the property received in the distribution to the Vendor on or before the 60th day after the day on which the eligible employee received the property (unless this 60-day requirement is waived pursuant to Code Section 402(c)(3)(B)); (b) An amount received by the Vendor on behalf of an eligible employee in a direct trustee-to-trustee transfer of an eligible rollover distribution from a qualified trust described in Code Section 401(a), a qualified annuity plan described in Code Section 403(a), an annuity contract described in Code Section 403(b), or a governmental Code Section 457(b) plan, in accordance with Code Section 403(b)(10); or (c) An amount received by the Vendor from an eligible employee that consists of the portion of a distribution from an individual retirement account or annuity described in Code Section 408(a) or 408(b) that is eligible to be rolled over and would otherwise be includible in gross income, provided that the eligible employee transfers the amount to the Vendor on or before the 60th day after the day on which the eligible employee received the amount (unless this 60-day requirement is waived pursuant to Code Section 402(c)(3)(B)). 6.3 Conditions. Rollover contributions to this Plan are subject to the conditions described in this section and to any additional conditions or limitations imposed by the receiving Contract. (a) The amount transferred to the Plan as a rollover contribution under this Article shall not exceed the portion of the distribution that is includible in gross income, determined without regard to Code Section 403(b)(8). (b) Before accepting a rollover contribution, a Vendor shall obtain a statement from the plan administrator of the distributing plan that the distributing plan is intended to comply with the applicable Code provision or such other statement or verification required by the Internal Revenue Service

21 6.4 Distributions. To the extent permitted by the applicable Contract or Contracts, a Participant who has a separate Plan account that is attributable to rollover contributions may elect to receive a distribution of all or any portion of the rollover account at any time

22 ARTICLE VII NONFORFEITABLE RIGHTS 7.1 Fully Vested Accounts. Subject to the terms of the applicable Contracts regarding the withdrawal of a Participant s accounts, the lost payee rule in 7.2 and 5.1(b)(ii), a Participant s rights to the benefit payable from the Participant s accounts are nonforfeitable. 7.2 Lost Payees. The Plan Administrator shall make reasonable efforts to determine the identity and whereabouts of Participants, Death Beneficiaries, and any other persons who are entitled to receive benefits under the Plan. If, after the date on which all or any portion of a Participant s accounts is distributable to any person under the Plan, the distribution cannot be made because the identity or whereabouts of such person cannot be ascertained, that portion of or all of the accounts shall constitute a forfeiture. The Plan Administrator s determination of when a distribution cannot be made shall be final. Notwithstanding the foregoing, if, at any time, the person entitled to the distribution makes a claim to the Plan Administrator for the distribution, the amount of the forfeiture shall be reinstated and distributed to the person

23 ARTICLE VIII DISTRIBUTIONS 8.1 Benefit Payments. Benefit payments shall be made by the Vendors in accordance with the terms of the Contracts and the applicable provisions of this Plan. 8.2 Distributable Events. (a) General. Except as otherwise permitted under the terms of this Plan, distributions from a Participant s account or accounts may not be made before the Participant has a Severance from Employment, dies, becomes disabled (within the meaning of Code Section 403(b)(11)(A)), or reaches age 59½. (b) Distributions During Service in the Uniformed Services. A Participant shall be treated as having had a Severance from Employment for purposes of eligibility to receive a distribution from his or her Plan account or accounts during any period in which he or she is performing service in the uniformed services while on active duty for a period of more than 30 days, as described in Code Section 3401(h)(2)(A). If a Participant elects to receive a distribution by reason of this subsection, he or she shall not be eligible to make elective contributions under Article IV during the six-month period beginning on the date of the distribution. 8.3 Payments to Minors and Incapacitated Persons. If a Participant or Death Beneficiary entitled to receive any Plan benefit is a minor or is determined to be legally incompetent by a court or in the reasonable judgment of the Plan Administrator, the Plan benefit shall be paid to a parent, guardian, conservator, or such other person as may be designated by the court or deemed appropriate by the Plan Administrator to receive the payment for the benefit of the Participant or Death Beneficiary. Any payment made under this section shall be considered a payment to the Participant or Death Beneficiary and, to the extent made, shall be deemed a complete discharge of any liability for the payment of benefits under the Plan. 8.4 Eligible Rollover Distributions. To the extent required by law, and except as otherwise provided below, any portion of an eligible rollover distribution that would otherwise be includible in the distributee s gross income if not rolled over shall, at the election of and in lieu of distribution to the distributee, be paid directly to the eligible retirement plan specified by the distributee. (a) Eligible Rollover Distribution. An eligible rollover distribution is any distribution of Plan benefits to a Participant, a Participant s surviving spouse, or a Participant s spouse or former spouse pursuant to a domestic relations order, as defined in 10.2 ( distributee ), except the following distributions: (i) Any distribution that is one of a series of substantially equal periodic payments made at least annually over one of the following periods: (A) For the life (or life expectancy) of the distributee, or the joint lives (or life expectancy) of the distributee and a designated beneficiary; or

24 (B) For a specified period of ten years or more. (ii) Any distribution to the extent it is required under Code Section 401(a)(9). (iii) Any hardship distribution. For purposes of this section, a portion of a distribution shall not fail to be an eligible rollover distribution merely because the portion consists of after-tax employee contributions that are not includible in gross income. However, any such portion may be transferred only to an individual retirement account or annuity described in Code Section 408(a) or (b), or to a plan described in Code Section 403(b) that agrees to separately account for amounts so transferred, including separately accounting for the portion of the distribution that is includible in gross income and the portion of the distribution that is not includible in gross income. The amount transferred shall be treated as consisting first of the portion of such distribution that is includible in gross income, determined without regard to Code Section 403(b)(8). The provisions of Code Section 402(c)(4) and the regulations thereunder are incorporated herein by reference for the purpose of further defining and interpreting the term eligible rollover distribution, and those provisions shall be controlling. (b) Eligible Retirement Plan. An eligible retirement plan is: (i) An individual retirement account described in Code Section 408(a); (ii) An individual retirement annuity described in Code Section 408(b) (other than an endowment contract); (iii) (iv) (v) A tax-deferred annuity described in Code Section 403(b); A qualified trust under Code Section 401(a); An annuity plan described in Code Section 403(a); and (vi) An eligible deferred compensation plan described in Code Section 457(b) that is maintained by an eligible governmental employer described in Code Section 457(e)(1)(A), and that agrees to separately account for amounts transferred into such plan from this Plan. The provisions of Code Section 402(c)(8)(B) and the regulations thereunder are incorporated herein by reference for the purpose of further defining and interpreting the term eligible retirement plan, and those provisions shall be controlling. (c) Direct Rollovers by Death Beneficiaries. Effective January 1, 2010, or such earlier date provided by the terms of the applicable Contract, if a distribution would qualify as an eligible rollover distribution under (a), except that it is payable to a deceased Participant s designated beneficiary who is not a distributee described in (a), the beneficiary may elect to have the distribution paid in a direct rollover to his or her

25 individual retirement plan. For this purpose, a designated beneficiary means the Participant s designated beneficiary for purposes of the required minimum distribution requirements of Code Section 401(a)(9). An individual retirement plan means an individual retirement account described in Code Section 408(a) or an individual retirement annuity described in Code Section 408(b), other than an endowment contract, that is established for the purpose of receiving the distribution on behalf of the designated beneficiary, and that will be treated as an inherited individual retirement account or individual retirement annuity pursuant to Code Section 402(c)(11). (d) Notices. Within a reasonable time period before making an eligible rollover distribution, the Vendor making the distribution shall provide the distributee with an explanation of the right to elect a direct rollover and the income tax withholding consequences of not electing a direct rollover. The explanation shall comply with the requirements of Code Section 402(f) and Internal Revenue Service guidance issued thereunder. 8.5 Required Distribution Rules. All distributions under this Plan shall be determined and made in accordance with Code Sections 403(b)(10) and 401(a)(9), including the incidental death benefit requirement in Code Section 401(a)(9)(G), and the applicable provisions of Treasury Regulation 1.401(a)(9)-1 through 1.401(a)(9)-9. The provisions of this Plan reflecting the requirements of Code Section 401(a)(9) shall take precedence over any inconsistent provisions of this Plan. Each Contract shall comply with the minimum distribution requirements of Code Section 401(a)(9) and the regulations thereunder. For purposes of applying those minimum distribution requirements, each Contract is treated as an individual retirement account, and distributions shall be made in accordance with the provisions of Treasury Regulation , except as provided in Treasury Regulation 1.403(b)-6(e). (a) Time and Manner of Distribution. (i) 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. (ii) 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, 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 70½, if later. (B) If the Participant s surviving spouse is not the Participant s sole designated beneficiary, distributions to the designated beneficiary will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died

26 (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 paragraph (ii), other than (ii)(a), will apply as if the surviving spouse were the Participant. (E) Participants or Death Beneficiaries may elect on an individual basis whether the five-year rule described in (C) above or the life expectancy rule described in (A) and (B) above 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 (A) or (B) above, 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 the Death Beneficiary makes an election under this subparagraph (E), distributions will be made in accordance with (A) or (B) above, as applicable, and (c)(ii)(a) below. For purposes of this paragraph and (c), unless (D) above applies, distributions are considered to begin on the Participant s required beginning date. If (D) above applies, distributions are considered to begin on the date distributions are required to begin to the surviving spouse under (A) above. (iii) Forms of Distribution. As of the first distribution calendar year, distributions will be made in accordance with (b) and (c). (b) Required Minimum Distributions During Participant s Lifetime. 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 this 8.5(b). 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 Code Section 401(a)(9) and the regulations thereunder. (i) 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 accounts by the distribution period in the Uniform Lifetime Table set forth in Treasury Regulation 1.401(a)(9)-9, using the Participant s age as of the Participant s birthday in the distribution calendar year; or

27 (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 Accounts by the number in the Joint and Last Survivor Table set forth in Treasury Regulation 1.401(a)(9)-9, using the Participant s and spouse s attained ages as of the Participant s and spouse s birthdays in the distribution calendar year. (ii) Lifetime Required Minimum Distributions Continue Through Year of Participant s Death. Required minimum distributions will be determined under this (b) beginning with the first distribution calendar year and up to and including the distribution calendar year that includes the Participant s date of death. (c) Required Minimum Distributions After Participant s Death. 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 this 8.5(c). 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 Code Section 401(a)(9) and the regulations thereunder. (i) Death On or After Date Distributions Begin. If the Participant dies after distributions are treated as having begun under the regulations under Code Section 401(a)(9), the remainder of the Participant s accounts will be distributed to the Participant s Death Beneficiary at least as rapidly as under the distribution method being used as of the date of death, and in accordance with the following provisions. (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 accounts 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