ROSS STORES, INC. 401(K) SAVINGS PLAN SUMMARY PLAN DESCRIPTION

Transcription

1 ROSS STORES, INC. 401(K) SAVINGS PLAN SUMMARY PLAN DESCRIPTION January 2015

2 ROSS STORES, INC. 401(k) SAVINGS PLAN SUMMARY PLAN DESCRIPTION Section I. Introduction... 1 Section II. Questions and Answers about Plan Provisions... 2 ELIGIBILITY AND PARTICIPATION Am I eligible to participate in the Plan? When and how do I enroll in the Plan? How long can I participate in the Plan?... 2 CONTRIBUTIONS What can I contribute to the Plan? What will Ross contribute to the Plan for me? What is my eligible compensation for contribution purposes? Are my contributions limited?... 5 VESTING When am I vested in my Plan Account? Is it possible for me to lose amounts allocated to my Plan Account?... 6 INVESTMENTS Who decides how my Plan Account is invested? What are my investment options? What if I fail to make an investment election? What information will I receive about the investment alternatives? How do I give the Plan investment directions? When will the value of my Plan Account be determined? Are there any fees and expenses charged to my Plan Account?... 8 LOANS AND IN-SERVICE DISTRIBUTIONS May I borrow from the Plan? May I take a hardship withdrawal from my Plan Account? May I request a distribution while I am still working for Ross? PAYMENT OF BENEFITS When will I receive my Plan benefits? Does the Plan provide for death benefits? How may I designate a beneficiary? How will my benefits be paid? How are my Plan benefits taxed? i -

3 25. Can my distribution be made as a direct rollover? ASSIGNMENTS May I assign or transfer my Plan Account prior to distribution? What is a qualified domestic relations order? ADMINISTRATION AND CLAIMS PROCEDURES Who administers the Plan? How do I make a claim under the Plan? How can I appeal a decision under the Plan? Can the Plan be amended or terminated? Are my benefits insured? Section III. Rights under ERISA Receive Information about Your Plan and Benefits Prudent Actions by Plan Fiduciaries Enforce Your Rights Assistance with Your Questions Section IV. General Information ii -

4 SECTION I. INTRODUCTION The Ross Stores, Inc. 401(k) Savings Plan (the Plan ) is a retirement plan that is designed to permit you, as an eligible Associate of Ross Stores, Inc., or certain of its subsidiaries (collectively referred to as Ross ), to accumulate funds for your retirement that are not currently taxable to you. The Plan was originally established effective as of January 1, 1969, and was restated in its entirety on January 1, The purpose of this summary plan description is to summarize the major features of the Plan in effect as of January If you are an eligible Associate, you may contribute a portion of your eligible compensation as elective deferral contributions on a pre-tax basis into the Plan through payroll withholding. If you meet the eligibility criteria for the Safe Harbor Matching contribution, Ross also makes safe harbor matching contributions based on a portion of the amount of your elective deferral contributions. You are 100% vested in your Elective Deferral Contributions Account and Employer Safe Harbor Matching Contributions Account. All contributions made to the Plan are held for your benefit by Wells Fargo Bank, N.A. (the Trustee ). This summary plan description often refers to amounts held in trust for you as your Plan Account, which administratively consists of several accounts based on the type of contributions that have been made, such as your Elective Deferral Contributions Account, your Employer Safe Harbor Matching Contributions Account or your Rollover Contributions Account. The Recordkeeper of the Plan is Wells Fargo Institutional Retirement Plan and Trust ( Wells Fargo ). You may obtain information about the Plan, including investment options, by contacting the Plan Recordkeeper (see page 17). This Plan is intended to comply with Section 404(c) of the Employee Retirement Income Security Act of 1974, as amended ( ERISA ). This means that you have the right to direct the investment of your Plan Account among the available investment funds and that the fiduciaries of the Plan may be relieved of liability for any losses that are the direct and necessary result of your investment instructions. This non-technical summary is not meant to interpret, extend, or change the provisions of the Plan in any way. The provisions of the Plan take precedence if there should be any conflict between the actual Plan document and this summary. The actual Plan document is used by the administrative committee (the Administrative Committee ), in its sole and absolute discretion as Plan Administrator, in interpreting and applying the provisions of the Plan and making all determinations under the Plan, such as those pertaining to eligibility, the amount of benefits, and claims. Only the Administrative Committee (or its authorized delegate), in its sole and absolute discretion, may make administrative interpretations of the provisions of the Plan. Neither the Plan nor this summary give you any right with respect to your employment with Ross, nor do they interfere with your right, or Ross s right, to terminate your employment at any time for any reason, which right is expressly reserved

5 SECTION II. QUESTIONS AND ANSWERS ABOUT PLAN PROVISIONS ELIGIBILITY AND PARTICIPATION 1. Am I eligible to participate in the Plan? Every Associate of Ross is eligible to participate upon meeting the eligibility requirements described in this Question 1, except for: (i) Associates covered by a collective bargaining agreement (unless that agreement specifically provides for participation in the Plan); (ii) nonresident aliens who receive no U.S. source income; (iii) leased employees; or (iv) consultants, independent contractors, or agency workers (whether or not such classifications are upheld upon government or judicial review). If you are not classified by Ross as a part-time, temporary, or seasonal Associate, you will be eligible to participate in the Plan for purposes of making elective deferral contributions on the first day of the month coinciding with or next following your hire date. You will be eligible to participate in the Plan for purposes of receiving safe harbor matching contributions when you have completed a year of service. A year of service is a 12-consecutive month period (starting with your hire date or each Plan Year thereafter beginning with the Plan Year that includes the first anniversary of your hire date) in which you complete 1,000 hours of service for Ross. If you are classified by Ross as a part-time, temporary, or seasonal Associate, you will be eligible to participate in the Plan for purposes of making elective deferral contributions and receiving safe harbor matching contributions when you have completed a year of service (1,000 hours in a 12-month period as described above). Part-time, temporary, or seasonal Associates will enter the Plan on the first day of the month coinciding with or immediately following the completion of one year of service. 2. When and how do I enroll in the Plan? If you are eligible, you may enroll by contacting the Plan Recordkeeper (see page17). Your elective deferral contributions will actually begin as soon as administratively feasible after you complete all necessary actions to enroll in the Plan. 3. How long can I participate in the Plan? Your participation in the Plan will continue until all balances in your Plan Account are distributed to you or your beneficiary. If you cease making contributions, lose eligibility, or terminate employment (but maintain your Plan Account) you become an inactive participant. Inactive participants are not eligible to make elective deferral contributions or receive safe harbor matching contributions. If you cease to be an active participant due to termination of employment or loss of eligible Associate status and are later reemployed by Ross or regain eligible status, then you may once again begin contributing to the Plan as soon as administratively feasible following your reemployment date or the date you regain eligible status and your completion of the enrollment process

6 If you go on an authorized leave of absence you will generally continue to participate if you are receiving compensation. If you go on a military leave, special rules apply and you should contact the Ross Benefits Department at CONTRIBUTIONS 4. What can I contribute to the Plan? Elective Deferral Contributions. As an active participant in the Plan, you may elect to defer (a) from 1% to 75% of your eligible compensation (as defined in Question 6 below) or (b) a dollar amount from each paycheck, and instead of receiving that amount in cash, it will be contributed to the Plan on your behalf and allocated to your Elective Deferral Contributions Account. Your elective deferral contributions will be made on a pre-tax basis. Earnings on your pre-tax elective deferrals grow tax free until you have a distribution event (see Questions 18-25). Pre-tax elective deferrals and earnings are generally taxed upon a distribution event (but see Question 25 for rules on rollovers). Your election must be expressed as a per pay period percent or dollar amount. The IRS limits the amount of annual compensation that can be used to determine your elective deferral contributions. The limit on compensation is $270,000 in 2017 (subject to future cost-ofliving adjustments). The IRS also limits the dollar amount of elective deferral contributions that you may make (not including catch-up contributions) in any calendar year to all 401(k) plans in which you participate. The limit is $18,000 for 2017 (subject to future cost-of-living adjustments). If you made elective deferral contributions into another qualified retirement plan (e.g., your previous employer s 401(k) plan) during the current calendar year, you are responsible for making sure that your total combined elective deferral contributions to the Ross 401(k) Plan and any other qualified retirement plan do not exceed the annual deferral limit for the current calendar year. You may increase, decrease, or discontinue elective deferral contributions at any time, and the change will become effective as soon as administratively feasible after you make an election. To make a request to change your deferral election, contact the Plan Recordkeeper (see page 17). Catch-Up Contributions. Catch-up contributions are additional contributions that may be made if you are, or will turn, age 50 before the end of the calendar year and if you, as of the end of any Plan year, will have made contributions to the Plan that exceed IRS or Plan limits. The total amount of catch-up contributions that may be contributed to the Plan is $6,000 for 2017 (subject to future cost-of-living adjustments). For example, if you are an eligible participant who turns age 50 on or before 12/31/17, the 2017 calendar year limit on your elective deferral contributions is $24,000 ($18,000 + $6,000). Please remember that you are responsible for reviewing your paycheck to make sure that your elective deferral contributions are correct. Your deductions are presumed to be correct unless you notify the Plan Administrator in writing before the end of the Plan year in which the error occurred

7 Rollover Contributions. If you are eligible to participate in the Plan, then you may be eligible to roll over to this Plan pre-tax amounts that you contributed to another retirement plan, such as a previous employer s qualified retirement plan. To initiate a rollover, contact the Plan Recordkeeper (see page 17). 5. What will Ross contribute to the Plan for me? Once you have met the eligibility requirements for the safe harbor match described in Question 1, Ross will make safe harbor matching contributions to the Plan based on the amount of elective deferral contributions and catch-up contributions you make to the Plan. For each payroll period, Ross will match 100% of the amount you contribute as elective deferral contributions and catch-up contributions to the Plan that do not exceed 3% of your eligible compensation for such payroll period, plus 50% of the amount you contribute as elective deferral contributions and catch-up contributions to the Plan that exceed 3% of your eligible compensation but do not exceed 5% of your eligible compensation for such payroll period. Safe harbor matching contributions are calculated and deposited to Accounts of participants eligible for safe harbor matching contributions on a per pay period basis, with no year-end adjustments to account for annualized pay amounts. Example #1: Assume John is an hourly Associate who earns $1,000 in eligible compensation per bi-weekly pay period ($26,000 per year) and elects to contribute 5% of his eligible compensation to the Plan as an elective deferral contribution ($50 per pay period). John will receive $40 in safe harbor matching contributions per pay period; 100% of the first 3% of his eligible compensation that is deferred or $30 plus 50% of the next 2% of his eligible compensation that is deferred or $10, for a total safe harbor matching contribution of $40 per pay period. If John is a 401(k) Plan participant for the entire Plan year and there are 26 pay periods in that year, he will contribute $1,300 as elective deferral contributions to the Plan and will receive $1,040 in safe harbor matching contributions for that year. If John only contributes 4% ($40) per pay period, he will miss out on the maximum match. He will receive a safe harbor matching contribution of only $35 per pay period (100% of the first 3% or $30 plus 50% of the next 1% or $5). Contributing only 4% (instead of 5%) results in $260 less in deferrals and $130 less in safe harbor matching contributions for that year. Example #2: Assume Jane is a salaried Associate who earns $48,000 in eligible compensation per year ($2,000 per semi-monthly pay period) and elects to contribute 10% of her eligible compensation to the Plan as an elective deferral contribution ($200 per pay period). Jane will receive $80 in safe harbor matching contributions per pay period; 100% of the first 3% of her eligible compensation that is deferred or $60 plus 50% of the next 2% of her eligible compensation that is deferred or $20, for a total safe harbor matching contribution of $80 per pay period. If Jane is a 401(k) Plan participant for the entire Plan year and there are 24 pay periods in that year, she will contribute $4,800 as elective deferral contributions to the Plan and will receive $1,920 in safe harbor matching contributions for that year

8 If Jane only contributes 3% ($60) per pay period, she will miss out on the maximum match. She will receive a safe harbor matching contribution of only $60 per pay period (100% of the first 3%). Contributing only 3% results in $480 less in safe harbor matching contributions for that year than if she had contributed at least 5% in elective deferral contributions for the year. 6. What is my eligible compensation for contribution purposes? Your eligible compensation for purposes of calculating the amount that you may defer as elective deferral contributions and consequently your safe harbor matching contributions is your wages that are included in gross income, plus amounts you contribute to the Plan or 125 Plan, during the Plan Year, excluding any amount in excess of the annual dollar limit ($270,000 for 2017, subject to future cost-of-living increases) and any amount received prior to your becoming an active participant. In addition, any amount you receive under the following circumstances will not be considered eligible compensation: (1) bonuses; (2) reimbursement or other expense allowances; (3) moving expenses; (4) any welfare or fringe benefits; (5) contributions to or distributions from a deferred compensation plan; (6) amounts realized from the exercise of nonqualified stock options, when restricted stock or other equity based compensation vests, the value of the grant of non-statutory options, amounts realized from the sale, exchange or other disposition of stock, or any other amounts that receive special tax benefits, such as premiums for group-term life; and (7) amounts that are similar to any of the items in (5) and (6). The maximum dollar amount of eligible compensation that may be taken into account under Federal tax law is the annual dollar limit ($270,000 for 2017, subject to future cost-of-living increases). 7. Are my contributions limited? Yes. The IRS imposes several limits on the amount that you may contribute to the Plan and the amount that Ross may contribute on your behalf to the Plan. For example, your elective deferral and catch-up contributions are subject to annual dollar limits (See Question 4). Accordingly, if in any calendar year you participate in the 401(k) plan of another employer as well as this Plan, and your total combined elective deferral or combined catch-up contributions (as applicable) to all 401(k) plans exceed the applicable dollar limits, then you will incur a tax penalty. It is your responsibility to calculate and monitor your combined plan contributions to avoid excess contributions for the calendar year. If you discover that your combined plan contributions exceed limits for a calendar year, you can avoid this tax penalty if you request and receive a distribution of the excess elective deferral or excess catch-up contributions amount (as applicable). If you wish to receive any excess contributions from this Plan, then you must notify the Plan Recordkeeper (see page 17) no later than March 1st of the following calendar year. The Plan Recordkeeper will let you know what information you need to fax or mail to the Plan Recordkeeper to process the distribution of excess contributions from this Plan

9 Federal tax laws also impose a maximum limit on the total dollar amount of all contributions (with the exception of rollover contributions and catch-up contributions) that can be contributed on your behalf in any year and may impose limits on the amount of contributions of higher-paid Associates. You will be notified if the amount contributed to your Plan Account exceeds either of these limits. VESTING 8. When am I vested in my Plan Account? You are 100% vested in your Elective Deferral Contributions, Employer Safe Harbor Matching Contributions, and Rollover Contributions Plan Accounts at all times. If you have employer matching contributions that were made under the Plan prior to January 1, 2002, your Employer Pre-2002 Matching Contributions Account is subject to a 4-year (25% per year) vesting schedule. 9. Is it possible for me to lose amounts allocated to my Plan Account? Depending on how your Plan Account is invested, the value of your Plan Account may decline because of investment results and general market conditions. INVESTMENTS 10. Who decides how my Plan Account is invested? Plan assets are held in a trust fund. The Trustee is responsible for maintaining the trust fund, subject to your investment fund selections. This Plan is intended to comply with ERISA Section 404(c). Accordingly, as a participant in the Plan, you are eligible to direct the investment of your Plan Account among the currently available investment funds. Because you choose your investments, you are responsible for any investment losses that are a direct and necessary result from your investment decisions. The fiduciaries of the Plan are not liable for any losses that are the result of your investment instructions. 11. What are my investment options? The Administrative Committee selects the investment alternatives offered under the Plan. The Administrative Committee chooses the investment alternatives to provide you with a range of investments that will give you a reasonable opportunity to materially affect the potential return on your Account and the potential risk to which your Account is subject. For a listing and description of the current funds, contact the Plan Recordkeeper (see page 17). The Administrative Committee monitors the investment alternatives and may change the investment alternatives from time to time. If this happens, you will be notified. Each fund has a particular investment objective and, accordingly, the degree of risk involved and the potential for long-term appreciation (or depreciation) will vary. You may contact the Plan Recordkeeper (see page 17) to request written materials, including a current prospectus, for each of the funds. Please refer to the prospectus for each fund for detailed information and financial data pertaining to each fund

10 Investments in retirement plans are not guaranteed by any bank, are not insured by the FDIC and may lose value. Before making any investment you should always obtain and read all available information concerning the investment, including a prospectus, financial statements, annual reports, other offering documents, and analysts reports where available. You may also wish to seek the advice of an investment advisor. 12. What if I fail to make an investment election? If you do not direct the investment of your Account balance, the Administrative Committee has designated target date funds as the Plan s default investment fund. The target date funds are gateway funds that invest in various master portfolios, which in turn invest in a combination of equity, fixed income, and money market securities using an asset allocation strategy designed to replicate the return of the Dow Jones Target Index that corresponds to the approximate year (target date) when you would retire. The target date funds will gradually shift emphasis from more aggressive investments to more conservative ones based on the target dates. An investment in a target date fund is not guaranteed at any time, including on or after the target date. The target date funds are intended to be a qualified default investment alternative (QDIA) within the meaning of Department of Labor Regulation 29 CFR Part Notice regarding the QDIA is provided if you are or may be defaulted into the QDIA. Materials provided to the Plan regarding the funds designated as the QDIA will be provided to you if your Plan Account is automatically invested in one of the funds designated as the QDIA. You may transfer out of a QDIA at any time without financial penalty. More details about the QDIA, including fees and expenses, are available through the Plan Recordkeeper. You can also obtain information concerning the other investment alternatives available under the Plan from the Plan Recordkeeper (see page 17). 13. What information will I receive about the investment alternatives? Once you become eligible to participate in the Plan, the Plan Recordkeeper will mail you an eligibility notification letter. As noted in the letter, you may obtain information about the Plan and the available investment alternatives, including a prospectus or offering statement for each investment option, by contacting the Plan Recordkeeper (see page 17). You should review the prospectus or offering statement for each of the investment alternatives prior to making an investment decision. To the extent these reports and information have been provided to the Plan, the Plan Recordkeeper can, upon your request, provide you with a report of the fund s annual operating expenses (including investment management fees, administration fees and transaction costs) that reduce the fund s rate of return and copies of any updated prospectus, financial statements or financial reports. The Plan Recordkeeper can also provide you with general updated information about the investment fund options and their rates of return. Certain additional information is available directly from the mutual fund companies

11 14. How do I give the Plan investment directions? You make your initial investment decisions and subsequently change the investment allocation for your Plan Account through the Plan Recordkeeper. The Plan does not limit your ability to move your investments from one fund to another, however fees may apply (see Question 16), and some investment funds may have trading restrictions. Changes to your investments must be made in 1% increments. You may also request to transfer a specific dollar amount amongst investment funds. You may elect to change the way your current Account is invested, the way your future contributions will be invested, or both, at any time. The Plan Recordkeeper will accept your directions and provide you with a written (or electronic) confirmation. Your investment direction will be implemented as soon as administratively feasible after it is received. You are strongly encouraged to verify that any investment allocation change that you request is properly recorded. You should carefully evaluate the investment alternatives available to you under the Plan and consult with your financial advisor to determine which funds meet your particular investment objectives. The value of your Plan Account is subject to a number of factors, including your investment choices, the performance of the available investment funds, expenses associated with the available funds, fluctuations in the stock market, variations in interest rates, and the economy. No assurances are given that the investment funds available under the Plan will produce any net earnings or appreciation or not suffer any net loss or depreciation. If you have any questions about the available funds, your investment directions, or how to make changes, contact the Plan Recordkeeper (see page 17). Read the investment fund prospectuses and other fund disclosures for information about fund investment objectives and fees. Note that some fund companies have frequent trading policies in place, such as redemption fees and purchase blocking. These policies are established by the individual fund companies and are disclosed in the fund prospectuses. You should read each fund s prospectus for more information about frequent trading policies and any additional fees that may apply. 15. When will the value of my Plan Account be determined? The value of your Account is calculated at the close of business on each day the applicable markets are open. Each time that the Plan s assets are valued, your Account will be credited with its allocable share of income, gain, or loss. You may check your Plan Account any time by contacting the Recordkeeper (see page 17). In addition, the Plan Recordkeeper will provide you a quarterly statement regarding your Account. Your participant statement will show your Account balance (including each source of contribution, e.g., elective deferral, match, etc.), and the value of each investment fund (including gains and losses). 16. Are there any fees and expenses charged to my Plan Account? Fees and expenses charged to your Plan Account and investment selections will impact your retirement savings. Such fees and expenses fall into three basic categories

12 Investment fees are associated with managing plan investments and are generally assessed as a percentage of assets invested, and are deducted directly from your investment returns. Investment fees can be in the form of sales charges, loads, commissions, 12b-1 fees, or management fees. You can obtain more information about such fees from the documents (e.g., a prospectus or offering statement) that describe the investments available under the Plan. Currently none of the funds offered by the Plan impose sales charges or loads, but certain funds may impose short-term trading fees or redemption fees. Please contact the Recordkeeper (see page 17) for further information about the investment fees and investment options. Plan Administration fees include the day-to-day expenses of the Plan for recordkeeping, accounting, consulting, legal and trustee services, as well as additional services available under the Plan, such as daily valuations, telephone response systems, internet access, on-line transactions, retirement planning tools and educational materials. Currently, a number of these costs are covered by investment fees that are deducted directly from investment returns, but, in some cases are paid directly by Ross. Transaction-based fees are associated with optional features or services offered under the Plan, and are charged directly to your Plan Account if you take advantage of a particular feature. Examples of transactions where fees will be charged directly to your Account include loan initiations, quarterly loan maintenance, distribution processing, in-service withdrawal processing (hardship withdrawals, age 59 ½ in-service withdrawals, withdrawals of rollover amounts), and processing of qualified domestic relations orders. For more information on fees associated with your Plan Account, contact the Plan Recordkeeper (see page 17). LOANS AND IN-SERVICE DISTRIBUTIONS 17. May I borrow from the Plan? You may borrow from the Plan if you meet the requirements under the Plan s Loan Policy, which may be amended from time to time by the Plan Administrator, in its sole and absolute discretion. The Loan Policy is available from the Plan Recordkeeper. To inquire about loan availability or to request a loan, contact the Plan Recordkeeper (see page 17). Loan requests will be processed as soon as administratively feasible. The maximum loan term for a personal loan is five years and the maximum loan term for purchase of a principal residence (which must be documented in writing) is ten years. The maximum loan available is the lesser of (1) $50,000 minus the highest outstanding balance in the last 12 months, or (2) one-half of your Account balance. A participant may only have one outstanding loan at a time. If loan payments are not paid according to schedule, the outstanding loan balance will be reported as a taxable distribution, subject to applicable federal, state and penalty taxes. 18. May I take a hardship withdrawal from my Plan Account? If, while you are employed by Ross, you have an immediate and heavy financial need that cannot be met through other available resources, then you may request a hardship distribution from the elective deferral portion (excluding any earnings) and the pre-2002 matching contributions (if any) portion of your Account. You must have obtained all other distributions, withdrawals, and - 9 -

13 loans available to you. You may request to withdraw an amount necessary to satisfy your financial need, including the amount of reasonably anticipated taxes and penalties. A hardship distribution may be made only for one of the following reasons, which you must be able to document in writing to the Plan Recordkeeper: unreimbursed expenses incurred or necessary for medical care, by you, your spouse, your dependents or your designated beneficiary; purchase of your principal residence (excluding mortgage payments); payment of post-secondary tuition and related educational fees, and room and board expenses, for the next 12 months for you, your spouse, dependents or designated beneficiary; payment necessary to prevent eviction from, or foreclosure on, your principal residence; payment for burial or funeral expenses for your deceased parent, spouse, children, dependents or your designated beneficiary; or expenses for the repair of damage to your principal residence that would qualify for the casualty deduction (without regard to whether the loss exceeds 10% of adjusted gross income). Your elective deferral and catch-up contributions to this Plan will be suspended for a period of six months following your hardship distribution. Hardship distributions are not eligible rollover distributions. The withdrawal amount will be reported as a taxable distribution, subject to applicable taxes. To initiate a hardship withdrawal request, contact the Plan Recordkeeper (see page 17). You will be required to provide documentation to support your request, which will be reviewed and, if complete, approved by the Plan Recordkeeper in accordance with guidelines established by the Plan Administrator. 19. May I request a distribution while I am still working for Ross? If you are age 59½ or older, then you may request and receive a withdrawal of all or a portion of your Plan Account while employed. Any withdrawals you take will reduce the value of your benefits at retirement, and will be subject to the direct rollover and withholding rules (see Questions 24 and 25). You may also request a distribution from the rollover portion of your Plan Account at any time

14 PAYMENT OF BENEFITS 20. When will I receive my Plan benefits? Other than in-service withdrawals (as described in Questions 18 and 19 above) you or your beneficiary may take a distribution of your Plan Account when you terminate employment with Ross or die. Note: If you transfer to a Ross related company, under IRS rules, you may not take a distribution. Plan Accounts Of $1,000 Or Less: If your vested Account balance is $1,000 or less, and if you do not make an election following your termination, then your Account will automatically be distributed in a lump-sum to you or your beneficiary (subject to the withholding requirements described in Question 24 below). Plan Accounts Greater Than $1,000 But Not Greater Than $5,000: If your vested Account balance is greater than $1,000, but not greater than $5,000, and if you do not make an election following your termination, then your Account will be distributed as an automatic rollover to an individual retirement account (IRA) in your name with an IRA provider designated by the Plan. Your automatic rollover IRA will be invested in an investment product designed to preserve principal and provide a reasonable rate of return, whether or not such return is guaranteed, consistent with liquidity. Your automatic rollover IRA will be charged with all fees and expenses related to the IRA. The fees and expenses will be comparable to the fees and expenses charged by the IRA provider. In addition, any applicable trading fees will apply if you decide to redirect the investment of the funds in automatic rollover IRA. The IRA provider may also change its fees for IRAs in the future. Amounts directly rolled over to the automatic rollover IRA are not taxable to you until distributed from the IRA. Once an automatic rollover IRA has been established for your distribution from the Plan, you will no longer be a participant in the Plan. You may contact the IRA provider that holds your automatic rollover IRA at any time to redirect the investment of your automatic rollover IRA assets or to request a distribution of your automatic rollover IRA. For further information regarding the automatic rollover provisions described above or the fees and expenses related to an automatic rollover IRA established as described above, contact the Plan Recordkeeper (see page 17). Plan Accounts of More than $5,000: If your vested Account balance exceeds $5,000, then your Account balance shall be paid to you in a single lump sum payment upon your request. Latest Date for Distribution. If you do not elect a distribution, then the Plan Administrator will assume that you have elected to defer payment. However, if you have terminated employment with Ross and you are (or reach) age 70½, then your Account will be distributed to you in a single lump sum no later than April 1 st of the calendar year following the calendar year in which you reach age 70½

15 21. Does the Plan provide for death benefits? Yes. If you die before your Account balance is distributed to you, your benefits will be distributed to your beneficiary in a single lump sum as soon as administratively feasible after your beneficiary requests a distribution, but in no event later than December 31 of the calendar year containing the fifth anniversary of your death. If your beneficiary is your spouse, your surviving spouse may elect to rollover the distribution to an IRA or his or her employer s eligible retirement plan. If your beneficiary is someone other than your spouse, such beneficiary may elect to either have the distribution paid to him or her directly in a lump sum or rollover the distribution to an IRA that is treated as an inherited IRA. 22. How may I designate a beneficiary? If you are married, then your spouse will automatically be your beneficiary, unless you designate another beneficiary with your spouse s written consent. In addition, if you marry after having made a beneficiary designation when unmarried, then that prior beneficiary designation is automatically revoked upon your marriage. If at the time of your death you have not designated a beneficiary, then your Account will be paid in the following order: (i) to your surviving spouse, if living; (ii) your estate. To designate a beneficiary (or change your existing beneficiary designation), contact the Plan Recordkeeper (see page 17). 23. How will my benefits be paid? You (or your spouse or beneficiary, in the event of your death) will receive your vested benefits in the form of a single lump sum cash payment. You may be eligible to roll over the distribution to your new employer s eligible retirement plan or to an IRA (see Question 25 below). 24. How are my Plan benefits taxed? When you receive (or your beneficiary receives) a distribution from the Plan, the entire amount of that distribution will generally be taxable to you (or to your beneficiary) as ordinary income. An additional 10% Federal tax penalty (and any applicable state tax penalty) may apply for early distribution, which is a distribution before you have reached age 59½. You may generally postpone or reduce income tax payable on a distribution from the Plan if you roll over all or a portion of the distribution to another eligible retirement plan or an IRA, as described in Question 25. You are strongly encouraged to consult with your tax advisor to determine how these (and related rules) apply to your particular facts and circumstances. 25. Can my distribution be made as a direct rollover? Yes. You may roll over your distribution, other than an in-service hardship distribution, to your new employer s retirement plan or to your own rollover IRA. You will receive a notice of your

16 right to elect a direct rollover and of the withholding consequences of not electing a direct rollover. If you request a direct rollover, then you must provide the Plan Recordkeeper (see page 17) with specific information about the retirement plan or rollover IRA to which the direct rollover is to be made. Your distribution check will be made payable to that entity for your benefit and will generally not be subject to tax withholding. It is your responsibility to confirm if your new employer s plan accepts rollovers. If you decide to arrange for the rollover on your own, rather than as a direct rollover, you must roll over such funds to a rollover IRA or your new employer s eligible retirement plan within 60 days following the date on which you received the distribution made payable to you. If you decide to arrange for a rollover on your own instead of requesting a direct rollover, then mandatory Federal withholding of 20% and applicable state withholding will apply to the cash portion of your distribution. This mandatory withholding applies even if you intend to make a rollover of the taxable portion on your own within the 60-day period. So, for example, if you receive a cash distribution of 80% of your Account balance, you may, within 60 days, roll over that amount to another retirement plan or IRA. If you roll over the 80% cash distribution that you received, then the 20% that was previously withheld is taxable as income. To avoid any tax on that 20%, you may make up the 20% amount from your own money when you roll over the 80% cash distribution that you received. Accordingly, you could, within 60 days, roll over both the 80% cash distribution as well as an additional 20% (which must be your own money), so that no portion of the distribution is currently taxable to you. ASSIGNMENTS 26. May I assign or transfer my Plan Account prior to distribution? Your interest in the Plan generally cannot be subject to a claim against you, or attached or subjected to garnishment or other legal process by a creditor, and you generally cannot sell, assign, or transfer your interest in the Plan before it is distributed to you. However, your interest in the Plan can be reduced due to: (i) Federal tax levies and executions on Federal tax judgments against you; (ii) payments made in satisfaction of the rights of an alternate payee in connection with a divorce pursuant to a qualified domestic relations order ( QDRO ) (see Question 29); (iii) an offset against your Plan Account, resulting from the default of a loan that you took from the Plan; or (iv) a judgment or settlement against you, as specifically provided for in the Internal Revenue Code. 27. What is a qualified domestic relations order? A qualified domestic relations order ( QDRO ) is a court order that creates or recognizes the right of an alternate payee (e.g., your child or former spouse) to all or a part of your Plan Account. A QDRO is an exception to the general protection of your Plan Account from creditors. The Plan Administrator has retained BPS&M, LLC, a subsidiary of Wells Fargo, to serve as the QDRO processor. You will be notified if the Plan receives a domestic relations order that affects your Plan Account. You and each alternate payee will be notified within a reasonable time, if that order is qualified. While the determination is being made, a hold will be placed on your

17 Account meaning loans, withdrawals, or distributions may not be taken to protect the affected benefits. To notify the Plan about a pending QDRO or to inquire about the process to qualify a domestic relations order, contact the Plan Recordkeeper (see page 17). ADMINISTRATION AND CLAIMS PROCEDURES 28. Who administers the Plan? The Administrative Committee is the Plan Administrator and fiduciary with respect to Plan administration and Plan investments. Ross and the Administrative Committee may appoint other persons/entities to assume certain Plan duties. The Administrative Committee, as the Plan Administrator, has the sole and absolute discretion and authority to construe, interpret, and apply Plan provisions and to make all Plan determinations, including (but not limited to) those regarding eligibility, the amount, manner and time of payment of any benefits from the Plan, and claims for Plan benefits. 29. How do I make a claim under the Plan? Distribution of your benefits under the Plan will normally be made as described in Questions above, as applicable to your particular circumstances. However, if you believe that you are being denied any rights or benefits under the Plan, then you may file a claim in writing with the Plan Administrator. You may review any pertinent documents, other than those that are legally privileged, and may submit issues and comments to the Plan Administrator in writing. Your beneficiary may bring a claim. You also may designate in writing an authorized representative to act on your behalf. If a claim is submitted that is denied in whole or in part, then the Plan Administrator (or its authorized delegate) will provide you, your beneficiary, or your authorized representative with an explanation. This explanation of the denial will include the following: (i) the specific reason(s) for the denial, as well as the specific provision(s) of the Plan upon which the denial is based; (ii) a list of any additional material or information that could help you support your claim and reasons why that material or information is needed; (iii) a statement that you will be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to your claim; and (iv) an explanation of how you may appeal the denial of your claim, and the time limits applicable to such procedures, including a statement of your right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review. Generally, you will receive this explanation within 90 days after receipt of your claim. If, however, special circumstances require an extension of time, then you will receive a notice prior to the end of the initial 90-day period informing you of the need for the extension and the anticipated time the decision will be reached. Any extension will not exceed an additional 90 days from the end of such initial period

18 30. How can I appeal a decision under the Plan? If your claim is denied in whole or in part, then you (or your authorized representative) may request a review. You must request a review by written application to the Plan Administrator within 60 days following the denial. The Plan Administrator will issue a decision within 60 days after your request for review has been filed, unless the Plan Administrator extends this period for an additional 60 days because of special circumstances. You will receive notification from the Plan Administrator within the first 60 days if it will extend the period for another 60 days and the anticipated date the Plan Administrator expects to decide the appeal. If your appeal of the denial of a claim is also denied in whole or in part, then the Plan Administrator will provide you with an explanation of the subsequent denial, which will include the following: (i) the specific reason(s) for the denial, as well as the specific provision(s) of the Plan upon which the denial is based; (ii) a statement that you will be provided (upon request and free of charge) reasonable access to, and copies of, all documents, records and other information relevant to your claim; and (iii) a statement regarding your right to bring an action under ERISA Section 502(a). You must exhaust the claims and appeals procedures before filing suit. No action may be brought against the Plan, Plan Administrator, Administrative Committee, Ross (or any related company), the trust or trustee more than one year after the exhaustion of these claims procedures. 31. Can the Plan be amended or terminated? Yes. Although Ross intends to continue the Plan, Ross reserves the right to amend or terminate the Plan, including but not limited to the right to discontinue contributions to the Plan at any time for any reason. Amendments are effective as of the date specified in the amendment and may be made retroactively. In the event that the Plan is terminated and, if Ross does not maintain another defined contribution plan, then your entire Account balance will be paid to you in accordance with the distribution provisions of the Plan. 32. Are my benefits insured? No. The benefits under the Plan are based solely upon contributions to your Account and any earnings (gains and losses) on those contributions. Consequently, the Pension Benefit Guaranty Corporation ( PBGC ) does not insure your benefits. SECTION III. RIGHTS UNDER ERISA As a participant in the Plan, you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974, as amended ( ERISA ). ERISA provides that all participants shall be entitled to: Receive Information about Your Plan and Benefits Examine, without charge, at the Plan Administrator s office and at other specified locations, such as work sites, all documents governing the Plan and a copy of the latest annual report (Form 5500 Series) filed by the Plan with the U.S. Department of

19 Labor and available at the Public Disclosure Room of the Employee Benefits Security Administration. Obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan, including copies of the latest annual report (Form 5500 series) and updated summary plan description. The Plan Administrator may make a reasonable charge for the copies. Receive a summary of the Plan s annual financial report. The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report. Obtain a statement telling you whether you have a right to receive a pension at normal retirement age (65) and, if so, what your benefits would be at normal retirement age (65) if you stop working under the Plan now. If you do not have a right to a pension, the statement will tell you how many more years you have to work to get a right to a pension. This statement must be requested in writing and is not required to be given more than once every 12 months. The Plan must provide the statement free of charge. Prudent Actions by Plan Fiduciaries In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate your Plan, called fiduciaries of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one, including your employer or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a pension benefit or exercising your rights under ERISA. Enforce Your Rights If your claim for a pension benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules. Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of Plan documents or the latest annual report from the Plan and do not receive them within 30 days, you may file suit in Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator. If you have a claim for benefits that is denied or ignored, in whole or in part, you may file suit in state or Federal court. In addition, if you disagree with the Plan s decision or lack thereof concerning the qualified status of a domestic relations order, then you may file suit in Federal court. If it should happen that the Plan fiduciaries misuse the Plan s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in Federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds that your claim is frivolous