CONTINUUM HEALTH PARTNERS, INC. 403(b) PLAN

Transcription

1 SUMMARY PLAN DESCRIPTION CONTINUUM HEALTH PARTNERS, INC. 403(b) PLAN (Employer Contribution and Salary Reduction Contribution)

2 TABLE OF CONTENTS Page INTRODUCTION HOW DOES THE PLAN WORK? WHAT ARE THE ELIGIBILITY REQUIREMENTS TO PARTICIPATE IN THE PLAN? HOW DO I CONTRIBUTE TO THE PLAN? HOW MUCH MAY YOU CONTRIBUTE TO THE PLAN? WHAT IF I EXCEED THE PERMITTED ELECTIVE DEFERRAL LIMIT? MUST I CONTRIBUTE TO THE PLAN? HOW MUCH WILL THE EMPLOYER CONTRIBUTE TO MY ACCOUNT? MAY I MAKE ROLLOVER CONTRIBUTIONS TO THE PLAN? WHAT DOES IT MEAN TO BE VESTED IN MY ACCOUNT? WHAT IS A BREAK IN SERVICE? HOW ARE THE FUNDS IN MY ACCOUNT INVESTED? ARE THERE INVESTMENT CHARGES? MAY I TRANSFER BETWEEN THE INVESTMENT FUNDS UNDER THE PLAN? HOW IS MY RETIREMENT BENEFIT DETERMINED? WHEN MAY I COMMENCE TO RECEIVE BENEFITS? IN WHAT FORM WILL I RECEIVE MY BENEFITS? WHAT OPTIONAL FORMS OF BENEFITS ARE AVAILABLE? WHAT IF I DIE BEFORE COMMENCEMENT OF MY BENEFITS? WHAT IF I DIE AFTER COMMENCEMENT OF MY BENEFITS? i

3 20. MAY I WITHDRAW ANY AMOUNTS FROM MY ACCOUNT WHILE I AM STILL EMPLOYED? MAY I BORROW FROM THE PLAN? WHAT ARE THE REQUIREMENTS FOR SPOUSAL CONSENT? DO I STILL RECEIVE SOCIAL SECURITY BENEFITS IF I PARTICIPATE IN THE PLAN? MAY I ASSIGN MY PLAN BENEFITS? IS THE PLAN AN EMPLOYMENT CONTRACT? MAY THE PLAN BE AMENDED OR TERMINATED? ARE BENEFITS UNDER THE PLAN INSURED BY THE PENSION BENEFIT GUARANTY CORPORATION? WHAT FEDERAL INCOME TAXES ARE APPLICABLE TO THE PLAN? CLAIMS PROCEDURE REPRESENTATIVE RESPONSIBLE FOR PROVIDING INVESTMENT INFORMATION ADDITIONAL INFORMATION ON THE CONTINUUM HEALTH PARTNERS, INC. 403(b) PLAN AS REQUIRED BY THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF YOUR RIGHTS UNDER THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF GLOSSARY EXHIBIT A... 1 ii

4 INTRODUCTION The Continuum Health Partners, Inc. 403(b) Plan (the Plan ) is maintained to help you with your retirement by providing you and your Spouse and Beneficiaries with retirement income to supplement your other retirement savings and benefits from Social Security and to provide you with a means to save on a pre-tax basis for retirement by permitting you to make pre-tax Salary Reduction Contributions to the Plan. This Summary Plan Description ( SPD ) provides you with an explanation of your benefits under the Plan and the requirements to receive them. The Plan, which was effective as of January 1, 2005 is the resulting Plan of the merger of the St. Luke s Roosevelt Hospital Center Section 403(b) Tax Sheltered Annuity Plan and the Long Island College Hospital 403(b) Retirement Plan into the Beth Israel Medical Center Tax Deferred Annuity Retirement Plan. In connection with the combination of the Continuum hospitals with Mount Sinai Health System, Inc., Beth Israel assumed sponsorship of the Plan, effective January 1, The following pages will summarize the Plan s provisions in effect as of November 1, 2013 and as amended thereafter. If your Termination of Employment occurred prior to November 1, 2013, then please consult the plan document for the Plan in which you participated or the applicable SPD in effect at that time. We urge you to read the following material carefully. We believe that you will find this SPD a valuable tool when you have questions about the Plan. Please keep this SPD handy for easy reference. If you have any questions, call the Benefits Office at (212) For definitions of the terms used in this SPD, see the Glossary. 1

5 There are several documents which officially control the provisions of the Plan and spell out the exact terms of your rights. The primary document is Continuum Health Partners, Inc. 403(b) Plan which will be referred to as the Plan in this booklet. In addition, there are contracts and/or agreements with certain funding agents, including Fidelity Investments Institutional Services Company, Inc. ( Fidelity ) pursuant to which contributions under the Plan are invested. Beth Israel as the Plan Administrator, has appointed a Committee (the Committee ) to administer the Plan on its behalf. The Committee will exercise supervisory control over the Plan s operation, including determination of the eligibility of employees to receive benefits, computation of the amount of benefit payments, and authorization for payment of such benefits. This Summary Plan Description ( SPD ) sets forth the provisions of the Plan in effect as of January 1, 2005 and thereafter. The primary purpose of this SPD is to provide you with a non-technical explanation of the most important features of the Plan. However, if there is any inconsistency between the Plan document and this SPD the provisions of the Plan document will govern. We urge you to read this SPD carefully so that you will understand the Plan as it applies to you and your family. We suggest that you keep this SPD handy for easy reference. 1. HOW DOES THE PLAN WORK? If you are an Employee, you are permitted to contribute, on a voluntary basis, a percentage of your Compensation pursuant to a Salary Reduction Agreement to the Account maintained for you by a Funding Agent. In addition, the Employer may contribute on your behalf to the Plan. You may enroll in the Plan by visiting plan.fidelity.com/chp or calling Fidelity at and completing the necessary salary reduction process. 2

6 Upon your retirement, the benefit you will receive will be based upon the amount in your Account and the payment option you select. 2. WHAT ARE THE ELIGIBILITY REQUIREMENTS TO PARTICIPATE IN THE PLAN? All Employees, other than leased employees, are permitted (but not required) to make Salary Reduction Contributions to the Plan immediately following their initial date of employment. Independent contractors and agents are not considered employees for this purpose. During any period that you are classified as either an independent contractor or you provide services to the Employer through another entity, you will not be eligible to participate in this Plan (even if you are later retroactively reclassified as an employee during all or any part of such period pursuant to applicable law or otherwise). In addition, if you are considered an Eligible Employee, you will also be eligible to receive Employer Contributions as described in Question 7, commencing with the first of the month coinciding with or immediately following your completion of one (1) Year of Service. If you are a member of the Special and Superior Officers Benevolent Association, you will be eligible to receive Employer Contributions as described in Question 7 commencing with the first day of the month following your one year anniversary of continuous employment (excluding any period during which you are on a leave of absence) with St. Luke s Roosevelt Hospital Center. If you are an Eligible Employee who was hired between April 30, 2010 and December 31, 2010 and you were employed by St. Vincent s Catholic Medical Center, Aptium W. New York, Inc. or Radiology Oncology Medical Practice of St. Vincent s, PC on April 29, 2010, you became 3

7 eligible to receive Employer Contributions as described in Question 7 after you completed one Hour of Service. To participate in the Plan, you must follow the enrollment procedures of the applicable Funding Agent. 3. HOW DO I CONTRIBUTE TO THE PLAN? To make contributions to the Plan, you must enter into a Salary Reduction Agreement with the Employer authorizing the Employer to reduce your Compensation on a pre-tax basis and specifying the amount of the reduction (referred to as Salary Reduction Contributions ) to be contributed on your behalf to the Account maintained for you by a Funding Agent. The Funding Agent will provide you with the appropriate procedure for entering into a Salary Reduction Agreement. You may enter into a new Salary Reduction Agreement at any time, to be effective as of the first day of the following payroll period (in accordance with notice procedures established by the Employer). Subject to certain legal limitations, Salary Reduction Contributions are not treated as income for federal income tax purposes until such later time as you receive them. 4. HOW MUCH MAY YOU CONTRIBUTE TO THE PLAN? There are several legal limits on the maximum amount that you may contribute to the Plan. The Code limits the amount you may contribute to the Plan on a pre-tax basis pursuant to a Salary Reduction Agreement in any calendar year. For 2014, the limit is $17,500 and will be adjusted by the Secretary of the Treasury for cost of living from time to time. If you also make other salary deferrals under any other 403(b) or 401(k) plan (whether maintained by the 4

8 Employer or another employer), such amounts will reduce the amount of your permitted Salary Reduction Contributions under the Plan. In addition, if you have attained (or will attain) age 50 before the end of the applicable Plan Year and you are fully contributing to the Plan such that you will reach the maximum permitted elective deferral to the Plan for the applicable Plan Year, you will be eligible to make a catch-up contribution beyond the permitted elective deferral limit. For 2014, this additional amount will be $5,500 and will be adjusted by the Secretary of the Treasury for cost of living from time to time. Such catch-up contribution will not be taken into account in calculating your Section 415 Limitation (described below). If you have completed 15 Years of Service with the Employer, then the permitted annual contribution amount may be increased by as much as $3,000. The amount that you may contribute in excess of the permitted elective deferral limit is the least of: (i) $3,000; (ii) $15,000 minus all amounts in excess of the permitted elective deferral limit that were allowed to be excluded from gross income in prior years due to this provision; or (iii) $5,000 multiplied by your years of service, minus all prior calendar year elective contributions. You may not contribute an amount pursuant to a Salary Reduction Agreement that together with contributions by any employer would exceed the Section 415 Limitation, which is the lesser of $51,000 (as adjusted) or one hundred percent (100%) of your taxable gross earnings during the calendar year. There are special rules for combining limitations if you participate in any other pension plan of the Employer or any other organization. In addition, in certain instances you may vary 5

9 your measuring year from the calendar year. If you are a participant in another plan or have varied your measuring year, you should consult with the Plan Administrator and your tax advisor. Notwithstanding any provisions of this SPD or the Plan to the contrary, contributions, benefits and service credit with respect to Qualified Military Service will be provided in accordance with applicable law. 5. WHAT IF I EXCEED THE PERMITTED ELECTIVE DEFERRAL LIMIT? If your aggregate Salary Reduction Contributions and other elective deferrals for the calendar year to the Plan and any other tax-qualified plan, whether maintained by the Employer or another employer, exceed the permitted elective deferral limit (in most cases, $17,500 for the year 2014), you can avoid the double taxation of the contributions at both the time of contribution and the time of withdrawal by, not later than March 1 following the close of the calendar year, allocating such excess deferrals among the Plan and the other plans under which the deferrals were made and notifying the Plan and each other plan of the portion allocated to it. In the event that the Employer receives such notice from you on a timely basis, the Plan will distribute to you, prior to April 15th, the excess allocated to it plus any income allocable to such amount. In the event that the Employer does not receive such notice from you on a timely basis, the Plan will distribute to you, by April 15th, any excess deferrals based only on contributions to the Plan plus any income allocable thereto, but without regard to other elective deferrals by you to other plans. 6

10 6. MUST I CONTRIBUTE TO THE PLAN? You are permitted, but not required, to make Salary Reduction Contributions to the Plan pursuant to a Salary Reduction Agreement. Depending upon the Funding Agent, the Salary Reduction Agreement may be completed either on a paper form or on-line via the internet. You should contact your Funding Agent regarding details on the Salary Reduction Agreement requirements. If you are not an Eligible Employee as defined in the glossary of this SPD, you will be eligible to make Salary Reduction Contributions to the Plan, but you will not be eligible for any Employer contributions. 7. HOW MUCH WILL THE EMPLOYER CONTRIBUTE TO MY ACCOUNT? If you are an Eligible Employee, the Employer will make certain contributions on your behalf to the Plan. The definition of Eligible Employee is included in the glossary of this SPD. If you are an Eligible Employee, the Employer will contribute, on a periodic basis, as an Employer Contribution to your Account (to be invested with a Funding Agent) the amount set forth on Exhibit A, provided, however, that you are still employed by the Employer and maintain an Account under the Plan. In addition, if you are an Eligible Employee, the Employer will contribute to your Account, on a periodic basis, an amount equal to your Salary Reduction Contribution for such period up to 3% of your Compensation (a Matching Contribution ). In any case, the Employer will make a Matching Contribution in an additional amount, if any, as of the last day of the applicable Plan Year, of up to 3% of your Compensation contributed by you during the Plan Year less any Matching Contributions previously made on your behalf with respect to such Plan Year. 7

11 Notwithstanding the foregoing, if you receive a distribution as a result of an excess deferral (as described in Question 5), then the portion of the Matching Contribution made with regard to such excess deferral (plus earnings) will be forfeited. The Code limits the amount of Matching Contributions that may be made to the Plan on behalf of members of the Highly Compensated Group of Participants. The law requires that the average of the amounts contributed for members of the Highly Compensated Group cannot exceed the average of the amounts contributed for Participants not in the Highly Compensated Group by more than a certain amount specified under the Code. You will be notified if you are affected by this limitation. 8. MAY I MAKE ROLLOVER CONTRIBUTIONS TO THE PLAN? Subject to certain requirements and applicable law, the Plan permits the acceptance of Rollover Contributions. A Rollover Contribution generally consists of an amount distributed from another 403(b) plan, tax-qualified plan, governmental Section 457 plan or an individual retirement account or annuity ( IRA ). However, the Plan will not accept any rollovers that consist of after-tax contributions. 9. WHAT DOES IT MEAN TO BE VESTED IN MY ACCOUNT? Vesting refers to your nonforfeitable right to all or part of the balance of your accounts under the Plan. You are always fully and immediately vested in all Salary Reduction Contributions and Rollover Contributions, if any, made under the Plan. If you were hired on or after November 1, 2013, you will become vested in the Employer Contributions made on your behalf upon your completion of three Years of Service or, if earlier, upon your death, Disability 8

12 or attainment of age 65. If your were hired prior to November 1, 2013, you will be fully and immediately vested in the Employer Contributions. If you terminate employment prior to becoming vested in your Employer Contributions, your Employer Contributions will be forfeited, and you will not be entitled these Employer Contributions unless such forfeited amounts are restored. Forfeited Employer Contributions will be restored if, after your Termination of Employment, you again become employed by an Employer or associated company (as defined under the Plan) before incurring five consecutive one-year Breaks in Service. 10. WHAT IS A BREAK IN SERVICE? A one-year Break in Service occurs if your continuous service with an Employer or associated company (as defined under the Plan) is broken due to (i) your retirement, (ii) your Termination of Employment, or (iii) your failure to complete more than 500 Hours of Service during any Anniversary Year. If you experience a Break in Service, your prior Years of Service will be reinstated if you were fully vested prior to the Break in Service or if the number of consecutive one-year Breaks in Service does not exceed the greater of (i) 5 or (ii) the aggregate number of Years of Service credited to you before the Break in Service. If you are not a Participant at the time of your Break in Service, you will have to satisfy the eligibility requirements for participation in the Plan prior to becoming a Participant. For purposes of determining whether a one-year Break in Service has occured, Hours of Service will include hours during which you are on an authorized leave of absence and will 9

13 include up to 501 Hours of Service while you are on a Childrearing Absence. During a Childrearing Absence such Hours of Service will be credited in an amount equal to the Hours of Service you would otherwise have been credited with or, if this cannot be determined, eight Hours of Service for each normal workday of absence. Hours of Service during a Childrearing Absence will be credited to the Anniversary Year in which the Childrearing Absence begins only to the extent required to prevent a one-year Breach in Service, and in all other cases will be credited to the following Anniversary Year. 11. HOW ARE THE FUNDS IN MY ACCOUNT INVESTED? When you enroll in the Plan (as described in Question 1), you must select the Investment Fund(s) in which you want your Account and future contributions on your behalf invested. You may allocate your Account among the various available Investment Funds, provided your allocations are in whole percentages. You may subsequently change this allocation with regard to future contributions, subject to rules of the Funding Agent(s) and the Employer. You may select and change your Investment Funds(s) and allocations by telephoning the Funding Agent at or logging on to plan.fidelity.com/chp. The available Investment Funds from which you may choose to invest may be changed from time to time. From time to time, the Employer may designate additional investment alternatives, withdraw investment alternatives or change the designation of investment alternatives. If any are changed, you will be notified. The Investment Funds available under the Plan and a description of these Investment Funds may be found by accessing plan.fidelity.com/chp. Each Investment Fund is also described in a prospectus or other materials that you will receive. You are urged to read the 10

14 relevant prospectus or other materials to understand the nature of the fund(s) of interest to you prior to making any investment selection. If you fail to follow the proper enrollment procedures, contributions to your Account may be invested in the Investment Fund that is the qualified default investment alternative designated for you by the Plan Administrator. The current qualified default investment alternative is the MFS Lifetime Fund. If any Investment Fund(s) which you have selected are subsequently eliminated from the Plan and you do not make a new election regarding the Investment Fund(s) in which you want future contributions to be invested, you will be deemed to have selected the Investment Fund(s) most similar to those that you previously elected. You should evaluate the investment alternatives available under the Plan in the same way you would evaluate any investment to determine whether you are comfortable with the investment risk and expected rate of return. The Plan is intended to constitute a plan under Section 404(c) of ERISA and Title 29 of the Code of Federal Regulations Section c-1. Consequently, the fiduciaries of the Plan may be relieved of liability for any losses which are the direct and necessary result of investment instructions given by you or your Beneficiaries. You are urged to read the literature describing each Investment Fund prior to making any investment decision. Remember, you will share in any losses as well as any gains of the funds you choose. 12. ARE THERE INVESTMENT CHARGES? Contributions to Investment Funds may be subject to investment management fees, including, but not limited to, commissions, loads or fees. These fees will vary from time to time and will be set forth in the applicable prospectus for each Investment Fund. 11

15 13. MAY I TRANSFER BETWEEN THE INVESTMENT FUNDS UNDER THE PLAN? Subject to the rules of the Funding Agent (as further described in the applicable prospectuses) and the Employer, you may transfer funds in your Account from one Investment Fund to another Investment Fund. Such rules may include restricting the availability of transfers or setting minimum or maximum amounts that may be transferred and when transfers are permitted. Any transfer may be subject to charges, including, but not limited to market value adjustments, as established from time to time by the Funding Agent with regard to the applicable Investment Fund. If you had and still have amounts invested in Investment Funds which are no longer available under the Plan, you should contact the Funding Agents directly, for investment and transfer options and instructions regarding these amounts. If any Funding Agent or Investment Fund is eliminated from the Plan and you do not elect to transfer the portion of your Account invested with or in such eliminated Funding Agent or Investment Fund to another Funding Agent or Investment Fund, if the Plan Administrator determines it is necessary, the Plan Administrator (to the extent legally permitted) may direct the transfer of such portion of your Account to another Investment Fund of a type similar to the Investment Fund being eliminated. You may make direct transfers of and/or change the allocation of future contributions to your Account by telephoning the Funding Agent at or logging on to plan.fidelity.com/chp. If you need information regarding any other Funding Agent, please contact the Plan Administrator. 12

16 14. HOW IS MY RETIREMENT BENEFIT DETERMINED? The amount of your benefit at retirement will depend upon the value of your Account, the form of benefit that you elect and the applicable annuity rates then in effect. 15. WHEN MAY I COMMENCE TO RECEIVE BENEFITS? Normally, your benefits will be available to be paid to you under the terms of the Plan on or after your retirement, death, Disability or other severance from employment. In addition, you may receive in-service withdrawals from your Employee Contribution Account after you have attained age fifty-nine and one-half (59½) (subject to legal restrictions and rules of the Funding Agent) and from your Employee Contribution Account and Rollover Account if you experience a Hardship (see Question 20). To commence receiving benefits you must elect to do so during the period 30 to 90 days prior to the date you wish benefits to commence. At the Funding Agent s discretion, you may be permitted to waive the 30 day minimum period (with the consent of your Spouse, if applicable) and have your benefits commence not less than 7 days after you receive the written explanation of the terms and conditions of a qualified joint and survivor annuity. You are generally required to commence receiving your benefits by the April 1 following the end of the calendar year in which (i) you reach age seventy and one-half (70½), or (ii) you retire, whichever is later. Notwithstanding the foregoing, you may elect to commence to receive benefits at any time after the April 1st following the end of the calendar year in which you reach age seventy and one-half (70½), even if you are still employed. In addition, to the extent required by the applicable Funding Agent or law, your benefits may be required to commence by your 75th birthday even if you are still employed by the Employer. 13

17 Note: If you receive a distribution of your benefits and do not roll over the distribution to a traditional Individual Retirement Account ( IRA ), Roth IRA or another eligible retirement plan, you may, in addition to any regular income tax liability, be required to pay an excise tax equal to 10% of the amount of the distribution unless the distribution was made: on or after you attained age 59½; due to your Termination of Employment because of Disability or having retired early after your 55th birthday; to your Beneficiary or estate following your death; as part of a series of substantially equal periodic installments, payable at least annually, made for your life (or life expectancy) or the joint lives (or life expectancies) of you and your Beneficiary; or to reimburse medical expenses that are deductible on your federal income tax return. Accordingly, we recommend that you consult your tax advisor before electing to receive any distribution. In addition to the taxes set forth above, tax law may require that 20% of your distribution be withheld for taxes unless directly transferred (as opposed to distributed and then rolled over ) to a traditional IRA, Roth IRA or other eligible retirement plan. State withholding may also apply. The Plan Administrator will give you written notice, explaining: (1) your right to a rollover of all or a portion of your distribution, and (2) the application of the mandatory 20% withholding tax to portions of the distribution that are not directly rolled over. 14

18 16. IN WHAT FORM WILL I RECEIVE MY BENEFITS? Your benefits will commence on the first day of the month coinciding with or immediately following the payment date which you elect by providing notice to the applicable Funding Agent. In no event may your benefits commence more than 90 days after your election to receive benefits. Generally, benefits may not commence less than 30 days after you receive notice of your rights to benefits from the Employer except that if the Funding Agent so permits, you may elect (with the consent of your Spouse if you are married) to commence receipt of benefits anytime more than 7 days after you receive notice of your rights to benefits. If you make an election of an optional form of benefit in writing to the Funding Agent, you will receive your benefits in the form elected. If you are married, any election of an optional form of benefit requires the notarized, irrevocable consent of your Spouse. If you do not make such an election, your benefits will be paid as follows: If you are not married or, if you are married and have waived the standard form of benefit for married Participants (with the consent of your Spouse, within the 90-day period prior to the first day of the first period for which your benefits are to commence), you will receive your benefits in the form of a life annuity with 10 years certain, providing for monthly payments for your life (with a guarantee that 120 payments will be made). If you are married and have not waived the standard form of benefit for married Participants, you will receive a joint and 50% survivor annuity with 10 years certain providing for an actuarially reduced monthly benefit for your life and, if you die, your Spouse (at the time benefits commence) will receive a monthly benefit, for his or her life, equal to 50% of the amount of the benefit you were receiving. Payments will cease at the later of the death of you or your Spouse (with a guarantee that 120 payments will be made). If your account balance does not exceed $5,000, then a lump sum distribution of your account balance will be made to you as soon as administratively practicable following your Termination of Employment. You may, however, elect to roll over the distribution to another 15

19 eligible retirement plan, including an individual retirement account ( IRA ). At the time of your Termination of Employment, the Plan Administrator will provide you with further information regarding your distribution rights. If the amount of the distribution will be more than $1,000 and you do not make an affirmative election to either receive your lump sum distribution or to roll over the distribution, then your distribution will be rolled over to an IRA. The Plan Administrator has entered into an Agreement with Fidelity, pursuant to which the rollover IRAs established by Fidelity with respect to these distributions will be invested in the Fidelity Cash Reserves Fund. The Plan Administrator has determined that the Cash Reserves Fund is a type of investment designed to preserve principal and provide a reasonable rate of return and liquidity. Fidelity will not charge an establishment fee or an annual fee with respect to a rollover IRA. A $50 termination fee will be charged by Fidelity when you liquidate your rollover IRA. You may transfer your rollover IRA, at any time and without cost, to any other IRA you choose. For further information regarding the Plan s automatic rollover provisions, the IRA provider, and the fees and expenses associated with the IRA you may contact: Fidelity Investments Tax Exempt Services Company, P.O. Box , Cincinnati, Ohio , telephone (800) WHAT OPTIONAL FORMS OF BENEFITS ARE AVAILABLE? Subject to the compliance with legal limitations and, if you are married, the consent of your Spouse, you may elect any of the forms of benefits made available by a Funding Agent by timely filing the appropriate election form (during the period 30 to 90 days prior to the date you wish benefits to commence, or, at the Funding Agent s discretion, you may be permitted to waive the 30 day minimum period (with the consent of your Spouse, if applicable) and have your benefits commence not less than 7 days after you receive the written explanation of the terms and conditions of a qualified joint and survivor annuity). If you are eligible to receive a joint and 16

20 survivor annuity, you may elect to receive payment of your benefits in the form of a Qualified Optional Survivor Annuity (a QOSA ). A QOSA is the actuarial equivalent benefit payable to you based on the value of your Account balance, which will be payable to you during your lifetime after the commencement of your benefits with 75% of such benefit continued to your Spouse for the duration of your Spouse s lifetime after your death. In no event will payments be made after the death of both you and your Spouse. If you have an Account balance in any Investment Fund and you wish to receive an optional form of benefit not permitted by the Funding Agent, amounts in your Account must first be transferred, if permitted, to a Funding Agent which offers the applicable optional form of benefit. 18. WHAT IF I DIE BEFORE COMMENCEMENT OF MY BENEFITS? If you die before benefits commence, your Beneficiary(ies) will receive the full value of your benefits under the Plan, subject to your designation and to the legal rights of your Spouse. If you are not married at the time of your death (or you are married, and you had, with the valid written consent of your Spouse, designated another Beneficiary for part or all of your benefits) and you die prior to commencing to receive any benefits under the Plan, your benefits under the Plan may be distributed to your Beneficiary(ies) in a lump sum or in an optional form of benefit he or she selects. If you are legally married at the time of your death and you die prior to receiving any benefits under the Plan, an amount equal to 50% of your benefits under the Plan will be distributed to your Spouse, in the form of an annuity, or if your Spouse elects, in the form of a 17

21 lump sum payment or an optional form of benefit in accordance with the rules of the applicable Funding Agent. Your Spouse also may, subject to legal requirements and Funding Agent rules, elect to leave his or her share of the benefit amount with the Funding Agent, and later elect a form of benefit payment. The remaining portion of your benefits will be paid to your designated Beneficiary(ies) or, if you did not designate a Beneficiary, all benefits will be paid to your Spouse. Such remaining portion may be distributed in an optional form of benefit selected by the Beneficiary or, if elected, may be left with the Funding Agent and distributed at a later time. Notwithstanding the foregoing, if you had, with the valid written consent of your Spouse, designated a Beneficiary other than your Spouse for more than 50% of your benefits, your Spouse will receive such lesser amount, if any, as is designated to him or her and the balance of your Account will be distributed to that Beneficiary in accordance with the terms of the immediately following paragraph. Any designation of a Beneficiary other than your Spouse made prior to the Plan Year in which your 35th birthday occurs will be null and void as of the beginning of such Plan Year, except if such election is made after you have terminated employment. If you die while performing Qualified Military Service, you will be treated under the Plan as if you died while employed by the Employer. Payments will be made as soon as administratively feasible following the date of your death in accordance with the election made by the Beneficiary. 18

22 19. WHAT IF I DIE AFTER COMMENCEMENT OF MY BENEFITS? If you die after commencing to receive benefits, your surviving Spouse or Beneficiary will receive such benefits, if any, as are provided under the form of benefit you were receiving at your death. 20. MAY I WITHDRAW ANY AMOUNTS FROM MY ACCOUNT WHILE I AM STILL EMPLOYED? Subject to the limitations existing at law, and the rules of the Funding Agent, you may receive in-service withdrawals from your Employee Contribution Account after you have attained age fifty-nine and one half (59½). In addition, subject to legal limitations and the rules of the Funding Agent, you may make withdrawals from your Employee Contribution Account (excluding earnings thereon) and Rollover Account if you experience a Hardship, as defined below. Hardship distributions shall be approved only if you have an immediate and heavy financial need as defined below and the distribution is necessary to satisfy the financial need. Hardship distributions will first be made from your Rollover Account to the extent permitted under the Plan and under the rules of the applicable Funding Agent. In addition, withdrawal of amounts from your Accounts may be subject to restrictions in accordance with the Plan and rules of the applicable Funding Agent. If you are married, your Spouse must consent in writing to a Hardship withdrawal. The following are deemed to be immediate and heavy financial needs of the Participant: (a) (b) uninsured medical expenses incurred by you, your Spouse or dependents or necessary for those persons to obtain medical care; purchase (excluding mortgage payments) of your principal residence; 19

23 (c) (d) (e) (f) (g) payment of tuition and related educational fees and room and board expenses for up to the next twelve months of post-secondary education for you, your Spouse, your children or dependents; the payment of amounts necessary to prevent your eviction from your principal residence or the foreclosure on the mortgage of your principal residence; payment of burial or funeral expenses for your deceased parent, Spouse, children or dependants; payment of expenses for the repair of damage to your principal residence that qualifies for the casualty deduction under Code Section 165; or such other circumstances as may be promulgated by the Internal Revenue Service. Hardship distributions will be deemed to be necessary to satisfy your immediate and heavy financial need if all of the following are satisfied: (a) (b) the withdrawal does not exceed the amount of your immediate and heavy financial need (which may include reasonably anticipated federal, state or local income taxes resulting from the distribution); and you have obtained all distributions, other than hardship distributions, and all nontaxable loans currently available under the Plan and any other deferred compensation plan maintained by the Employer. In the event that you make a Hardship withdrawal, then you will be suspended from making any elective contributions to any other qualified or nonqualified plan maintained by the Employer, other than health and welfare benefit plans, for six (6) months following the Hardship withdrawal. All hardship withdrawals are subject to the rules, procedures, forms and notice requirements, all as established by Beth Israel or on its behalf. If you are married, the written, notarized, irrevocable consent of your Spouse to such withdrawal will be required. Amounts withdrawn on account of Hardship may not be rolled over to a traditional IRA, Roth IRA or other eligible retirement plan. Further, such amounts will not be subject to the 20

24 20% withholding tax law generally requires on distributions not directly transferred to a traditional IRA, Roth or other eligible retirement plan. Such amounts, may, however, be subject to a 10% excise tax on early distributions. You should consult your tax advisor prior to making any withdrawals as there are possible tax consequences. 21. MAY I BORROW FROM THE PLAN? Upon application to the Funding Agent, subject to the rules of the Funding Agent and the terms of the applicable contract and your Spouse s consent if you are married, the Funding Agent will make a loan to you under the contract. The minimum amount of any loan is $1,000. All such loans must: (i) (ii) be adequately secured; bear interest at a rate determined by the Funding Agent; (iii) be subject to such charges as imposed by the Funding Agent, in accordance with its contract with the Employer; (iv) have a definite level amortization repayment schedule (to be at least once per quarter) not to exceed 5 years (not to exceed a longer duration established by the applicable Funding Agent, in the case of a loan used to acquire any dwelling unit which within a reasonable period of time is to be used as your principal residence); and (v) be subject to the rules of the Funding Agent. The aggregate loans to you cannot, when combined with outstanding loan balances from the Plan and certain other tax-qualified plans or Section 403(b) plans, exceed the least of: (i) $50,000, less the excess (if any) of (A) the highest amount of loans outstanding to you within the 12 month period ending on the day prior to the date the loan is made over (B) the outstanding balance of loans outstanding on the date the loan is made; 21

25 (ii) (iii) fifty percent (50%) of the value of your Account under the Plan; or such amount as permitted by the Funding Agent. As security for a loan you will be required to pledge an amount as required by the Funding Agent provided that the pledged amount: (i) may not exceed 50% of the value of your Account at the time of the loan, and (ii) is invested in Investment Funds in accordance with Funding Agent rules. Loans must be repaid by you on a level basis, not less frequently than quarterly. Subject to any limitations imposed by applicable state insurance departments, in the event that you do not repay your loan or the interest thereon in accordance with the schedules prescribed or any permitted grace periods, the Funding Agent will deduct the total amount of your outstanding loan and/or any interest and other charges due and owing, from any amount payable or distributable from the portion of your Account securing the loan, or such lesser amount as stipulated by the applicable state insurance department. Even if such deduction can not then legally be made, you will have a deemed distribution (i.e., a defaulted loan will be treated as income to you) for tax purposes and an offset as soon as legally permitted. Until such offset can legally be made, the loan will remain outstanding to the extent required by law. Loan repayments will be suspended during Qualified Military Service in accordance with Code Section 414(u)(4). If you are married as of the date a Plan loan is to be made to you, the loan will require your Spouse s written, notarized, irrevocable consent. The consent must be given during the 90 day period prior to the date of the loan, and must consent to the potential reduction of your benefits in the event of your non-payment of the loan. Your Spouse s consent is also required for any renegotiation, extension, renewal or other revision of any Plan loan to you. 22

26 If you retire, die or otherwise incur a Termination of Employment before your loan is repaid in full and you wish to receive a distribution, the amount of the loan (with interest) will be deducted from your Account before benefit payments will be paid to you or your Beneficiary. A loan may be prepaid in full or in part without penalty only with the advance consent of the applicable Funding Agent, unless otherwise required by law. The rules of the applicable Funding Agent may restrict the availability of amounts in your Employer Contribution Account for loan withdrawals. (Please consult the Plan Administrator for details). The Employer and applicable Funding Agent are entitled to establish additional rules in connection with loans in accordance with applicable law. 22. WHAT ARE THE REQUIREMENTS FOR SPOUSAL CONSENT? All consents by a Spouse must be in writing and either notarized or witnessed by a Plan representative and contain an acknowledgment by your Spouse as to the effect of the consent. All such consents shall be irrevocable. A spousal consent is not required if you can establish to the Employer s satisfaction that you have no Spouse or that he or she cannot be located. Unless a Qualified Domestic Relations Order, as defined in Section 414(p) of the Code (described in Question 24), requires otherwise, a Spouse s consent shall not be required if you are legally separated or you have been abandoned (within the meaning of local law) and you have a court order to such effect. The consent must specifically designate the Beneficiary or otherwise expressly permit designation of the Beneficiary by you without any further consent by the Spouse. If a designated 23

27 Beneficiary dies, unless the express right to designate a new one has been consented to, a new consent is necessary. A consent to an alternative form of benefit must either specify a specific form or expressly permit designation by you without further consent. A consent is only valid so long as your Spouse at the time of your death, benefit commencement, or loan, as the case may be, is the same person as the one who signed the consent. With regard to loans, the spousal consent necessary is that of your Spouse at the time of the loan and the Spouse must consent to both the loan and the potential reduction of benefits in the event the loan is not timely repaid. Any renegotiation, extension, renewal or other revision of a loan to a Participant requires a new consent. Consent of a Spouse to an alternative benefit form or loan must be made within 90 days prior to the date of the distribution, first payment or loan. Even where such consent is not expressly required, the Employer reserves the right to require the consent of your Spouse to any election or revocation of election made under the Plan. 23. DO I STILL RECEIVE SOCIAL SECURITY BENEFITS IF I PARTICIPATE IN THE PLAN? Yes. The benefits you receive under the Plan are in addition to any benefits you may receive from Social Security. Social Security benefits are, of course, paid by the federal government and are dependent upon your career earnings and employment, as well as the provisions of the Social Security Act which are in effect at the time you are eligible to receive Social Security benefits. 24

28 24. MAY I ASSIGN MY PLAN BENEFITS? Generally, no. The Plan does not permit you to assign your benefits in the Plan. In addition, pursuant to the terms of the Plan, no lien may be created on any funds, securities or other property held under the Plan and your creditors may not attach, garnish or otherwise interfere with your Account balance. One exception to this rule is a payment made pursuant to a Qualified Domestic Relations Order ( QDRO ). A QDRO is a court order or decree that compels the Plan Administrator to pay or allocate a portion of your Account to your Spouse, former Spouse, child or other dependent. If a QDRO is received by the Plan Administrator, all or a portion of your Account balance may be used to satisfy the obligation. You or your beneficiaries may obtain, without charge, a copy of the QDRO procedures from the Plan Administrator. A second exception involves circumstances under which your benefits under the Plan are offset by an amount for which you are liable to the Plan as a result of your conviction of a crime regarding the Plan, a civil judgment or a settlement agreement between you and the U.S. Department of Labor or Pension Benefit Guaranty Corporation. 25. IS THE PLAN AN EMPLOYMENT CONTRACT? No. Neither the establishment of the Plan, any provision under the Plan, nor your participation in the Plan guarantees your continued employment or entitles you to the right to continue employment with the Employer or affects your employment status with the Employer. If your employment terminates for any reason, the Plan will not provide you with any benefit except as specifically provided in the Plan. 25

29 26. MAY THE PLAN BE AMENDED OR TERMINATED? It is Beth Israel s intention that the Plan will continue indefinitely, however, the Board of Trustees reserves the right to amend or terminate the Plan. You may obtain information concerning the Board of Trustees from the Plan Administrator. If Beth Israel does terminate the Plan, you will still be entitled to your full Account balance. 27. ARE BENEFITS UNDER THE PLAN INSURED BY THE PENSION BENEFIT GUARANTY CORPORATION? No. Benefits under this type of Plan are not insured by the Pension Benefit Guaranty Corporation (the PBGC ), which is a federal agency that insures certain pension plan benefits upon plan termination, because the benefits you receive under this type of plan are based upon the vested amount in your Account. 28. WHAT FEDERAL INCOME TAXES ARE APPLICABLE TO THE PLAN? Under current federal income tax law, your pension benefits are not taxable while they accumulate in the Plan. As discussed above, in certain instances, upon distribution of your pension benefits, federal (and possibly state and local) income taxes will be withheld from your pension benefits unless you make a direct rollover to an IRA, another Section 403(b) plan, a taxqualified plan or to a governmental Section 457 plan. In addition, federal income taxes are automatically withheld if your mailing address is outside the United States and in certain other instances. You may also elect voluntary withholding. There are certain tax penalties if you withdraw your retirement benefits early. Regardless of whether you elect to have federal income taxes withheld or it is done automatically, you will still be responsible for payment of such taxes. 29. CLAIMS PROCEDURE Initial Claims 26

30 Any claim you have with respect to eligibility, participation, contributions, benefits or other aspects of the operation of the Plan should be made in writing to Beth Israel. Beth Israel will provide you or your Beneficiary with the necessary forms and make all determinations as to the right of any person to a disputed benefit. You will be notified of the acceptance or denial of your claim for benefits within 90 days from the date Beth Israel receives your claim. In some cases, your request may take more time to review and an additional processing period of up to 90 days may be required. If that happens, you will be notified in writing. The written notice of extension will indicate the special circumstances requiring the extension of time and the date by which Beth Israel expects to make a determination with respect to the claim. If your claim is wholly or partially denied, or any other adverse benefit determination is made with respect to your claim, the Vice President of Human Resources will furnish you with a written notice of this denial. This written notice will be provided to you within a reasonable period of time (generally 90 days, or, if the claim involves a determination of Disability, 45 days) after the receipt of your claim by Beth Israel. The written notice will contain the following information: (i) the specific reason or reasons for the denial; (ii) specific reference to those Plan provisions on which the denial is based; (iii) a description of any additional information or material necessary to correct your claim and an explanation of why such material or information is necessary; and (iv) a description of the Plan s review procedures and the applicable time limits, as well as a statement of your right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review. 27

31 If a notice of the denial of a claim is not furnished to you in accordance with the above within a reasonable period of time, your claim will be deemed denied. You will then be permitted to proceed to the review state described in the following paragraphs. Appeals If your claim has been denied, or any other adverse benefit determination is made with respect to your claim, and you wish to submit your claim for review, you must file your claim for review, in writing, with the Committee. You must file the claim for review no later than 60 days after you have received written notification of the denial of your claim for benefits (or, if none was provided, no later than 60 days after the deemed denial of your claim). In connection with the request for review, you (or your duly authorized representative) may submit to the Committee written comments, documents, records, and other information relating to the claim. In addition, you will be provided, upon written request and free of charge, with reasonable access to (and copies of) all documents, records and other information relevant to the claim. The review by the Committee will take into account all comments, documents, records and other information you submit relating to the claim. The Committee will make a final written decision on a claim review, in most cases, within 60 days (or, if the claim involves a determination of Disability, 45 days) after receiving your written claim for review. In some cases, your claim may take more time to review, and an additional processing period of up to 60 days may be required. If that happens, you will be notified in writing. The written notice of extension will indicate the special circumstances requiring the extension of time and the date by which the Committee expects to make a determination with respect to the claim. If the extension is required due to your failure to submit 28