BB&T Non-Qualified Defined Contribution Plan 2012 Enrollment Guide
Dear Participant: BB&T offers a special, non-qualified supplement to our 401(k) plan for our employees who are considered highly compensated and management employees by the Internal Revenue Service and Department of Labor. Because you are in the highly compensated group of BB&T employees, you have the opportunity to enroll in this plan and save even more for your retirement years. This enrollment guide will help you make important decisions about your plan participation. For 2012 participation, you can make your Non-Qualified Plan elections from June 1, 2011, through June 30, 2011. You should have received a memo entitled 2012 Non-Qualified Defined Contribution Plan Enrollment, outlining your current elections (if any) in the Non-Qualified Plan. If you want to continue your 2011 deferral election in 2012, you don t need to do anything. If you choose to participate in the Plan, or continue your participation unchanged from 2011, we will automatically sync your 401(k) deferral percentage to match your Non-Qualified Plan deferral percentage effective January 1, 2012, unless you have chosen not to sync your elections. During the enrollment process, you may elect to sync or not sync your deferral percentage. You may change your 401(k) deferral percentage during 2012 by accessing the automated phone system or website and making a new election. Your contributions to the 401(k) plan will continue until you reach the deferral limit or compensation limit imposed by the IRS. At that time, your election under the Non-Qualified Plan will take effect and will continue unchanged for the remainder of the year. If you change your investment elections during the online enrollment process, this change will be effective for any contribution received after the change has been made, including any remaining 2011 contributions made to your account. Please read the material in this booklet carefully to make sure you have a complete understanding of how the Plan works. If you have questions after reviewing this material, please call the Human Systems Service Center at 800-716-2455, option 1, then option 2. We hope you will take full advantage of what the BB&T Non-Qualified Defined Contribution Plan has to offer. Sincerely, BB&T Benefits Administration
TABLE OF CONTENTS Important Facts to Understand and Remember 1 Plan Highlights 2 How to Enroll Online 7
IMPORTANT FACTS TO UNDERSTAND AND REMEMBER If you want to enroll or change your participation level in the Plan for 2012, you must enroll between June 1 and June 30, 2011. If you do not enroll by June 30, 2011, it will be assumed that you elect to continue participation in the Plan for 2012 unchanged from 2011. If you elect to participate in the Non-Qualified Plan for 2012: n Your deferral rate in the Non-Qualified Plan is fixed and cannot be changed for the entire 2012 calendar year. You will not be able to change your Non-Qualified Plan deferral election until the 2013 Plan year. n You may make changes to your deferral percentage in the BB&T Corporation 401(k) Savings Plan (BB&T 401(k) Savings Plan) at any time during 2012. n The election you make as to the timing of your distribution during this enrollment process CANNOT be accelerated in future years. For example, if you elect to have your distribution made to you within 60 days following attainment of age 65, you are restricted from subsequently electing to have your payment made to you within the 60 days following your separation from service (assuming you leave BB&T prior to attaining age 65). n Timing elections also cannot be changed to defer payments unless the new payment start date is at least five years after the payment start date currently in place. No changes can be made to this election once you reach age 60. n Changes to timing or form of payment elections must be in place for 12 months to be effective. n All of your compensation is subject to this deferral election. You will not make a separate election for annual incentive payouts. n The maximum deferral percentage is 50%. n Employer matching contributions will continue to go into the BB&T 401(k) Savings Plan until they reach the allowable limit. You may reach a point where all of your salary deferrals are going into the Non-Qualified Plan but your matching contributions are still accumulating in the 401(k) Savings Plan. If you elect NOT to participate in the Non-Qualified Plan for 2012: n Your deferrals in the BB&T 401(k) Savings Plan will stop once they reach the Internal Revenue Service (IRS) imposed limits. n You will not be able to participate in the Non-Qualified Plan for the entire 2012 calendar year. 1
PLAN HIGHLIGHTS Purpose of the Plan The primary purpose of the Non-Qualified Plan is to allow tax-deferred contributions that are otherwise restricted under the BB&T 401(k) Savings Plan due to limits imposed by the IRS. The Plan is not intended to be a tax-qualified plan under the Internal Revenue Code; therefore, balances from the Plan are not eligible for rollover to an IRA or a qualified plan. Becoming a participant Participation in the Non-Qualified Plan is open to employees of BB&T who meet the IRS definition of highly compensated and management employees. Employees who earn more than $110,000 (salary and bonuses) in calendar year 2011 are considered highly compensated for calendar year 2012 participation. Only employees who are projected to exceed $110,000 based on pay through April 30, 2011, will be eligible. You must also be a participant in the BB&T 401(k) Savings Plan to be eligible to participate in the Non-Qualified Plan. Open Enrollment begins each June for new participants. Employees who join BB&T through a merger may be eligible to enroll at a time other than June. How the Plan works The Non-Qualified Plan gives participants the opportunity to continue their pre-tax deferrals and matching contributions after they reach maximum limits in the BB&T 401(k) Savings Plan. In a qualified plan, such as the BB&T 401(k) Savings Plan, contributions are restricted by certain government limitations. When a participant defers 1-50% of compensation on a pre-tax basis in the BB&T 401(k) Savings Plan, these contributions are matched with Company contributions at a rate of 100% for the first 6%. When the maximum salary limit or deferral limit is reached in the BB&T 401(k) Savings Plan, a participant s contributions are then contributed into the Non-Qualified Plan. See the examples on pages 5 and 6 to understand better how your deferrals and matching contributions are recognized in each Plan. You may invest your money in the Non-Qualified Plan in any of the investment funds available, or in the self-directed brokerage account. The funds offered in the Plan may be changed from time to time. 2012 government limitations You may defer a maximum of 50% into the BB&T 401(k) Savings Plan in 2012, subject to the following limits (the 2012 IRS limits have not been announced): Maximum qualified plan deferral limit: 50% 2011 Maximum pre-tax employee deferrals: $16,500* 2011 Maximum salary considered: $245,000 *Participants age 50 and older can contribute an additional $5,500 to the BB&T 401(k) Savings Plan. Please note that catch-up contributions are not eligible for employer matching contributions. Matching contributions As stated above, participants will receive a matching contribution on the first 6% of compensation up to the maximum deferral and salary limits for 2012. For participants with compensation less than the maximum salary limit, the maximum matching contribution that can be contributed into the BB&T 401(k) Savings Plan is the maximum deferral limit. Employer match dollars will continue to go into the BB&T 401(k) Savings Plan until they reach this allowable limit and then will be contributed to the Non-Qualified Plan. 2
If you are a participant with compensation in excess of the maximum salary limit, your matching contributions will be contributed to the BB&T 401(k) Savings Plan until you reach the maximum deferral limit or the maximum salary limit, whichever comes first. After this point, your matching contributions will be contributed to the Non-Qualified Plan. This means you may receive a quarterly statement with all employee contributions for a given month going into the Non-Qualified Plan and the employer match going into the BB&T 401(k) Savings Plan. Payment options Payments can begin at one of the following times (your Timing Election ): n Within 60 days following your separation from service with BB&T n February of the year following your separation of service n Within 60 days following your attainment of age 65 n February of the year following the year in which you attain age 65. Consider your Timing Election carefully because future changes are limited. You may elect to receive your account balance in one of the following two ways (your Distribution Election ): n Lump Sum payment n Approximate equal monthly payments to you over a term certain not to exceed 180 months. You may change your Distribution Election and Timing Election at any time; however, changes do not become effective until one year following the change. For example, if you elect to change your payment options in December, then separate from service in June, your change would not yet be effective and your prior election would govern. If you are a new participant, your Distribution and Timing Elections are effective immediately. Payments are not eligible for rollover to a qualified plan. Section 409A of the Internal Revenue Code states that you will be subject to income tax and a 20% excise tax if you accelerate the start of payments after you first elect a payment option. For this reason, the Plan does not permit any change to accelerate your payments. In addition, although you can change your Timing Election to defer the start of payments, the new start date must be at least five years after the start date of the election currently in place. Once you reach age 60, you cannot make changes to your Distribution and Timing elections. Unforeseeable emergency payments Distributions from the Non-Qualified Plan are available for unforeseeable emergency payments. You may make application to the BB&T Employee Benefits Plan Committee to receive a cash payment in a lump sum of all or a portion of the total amount credited to your account. An unforeseeable emergency payment shall not exceed the amount required to meet the financial hardship created by the emergency. You must have received all amounts that are available from other resources, including amounts available from the BB&T 401(k) Savings Plan. An unforeseeable emergency is a severe financial hardship resulting from a sudden and unexpected illness or accident, loss of your property due to casualty, or other similar extraordinary and unforeseeable circumstances beyond your control. The Committee has sole and absolute discretion, and its decision to grant or deny a payment shall be final. 3
Investments As with the BB&T 401(k) Savings Plan, you elect the investment directions for your Non-Qualified Plan account, selecting from investments provided under the Plan. There are a variety of investment options to choose from (details of each investment option are available at www.bbt.com/plantrac). A self-directed brokerage option is available through TD Ameritrade TM. If you are a new participant, your 2012 contributions will automatically default to the BB&T One-Year BIC, unless you make other investment elections. If you are currently a participant in the Plan, you may make changes to your investment elections during the online enrollment process; these changes will be effective immediately, including any remaining 2011 contributions. To access your account, visit www.bbt.com/plantrac. Becoming vested in your Plan account Because the BB&T 401(k) Savings Plan is a qualified plan, your account balance is fully vested (i.e., nonforfeitable) at all times. However, a participant s balance in the Non-Qualified Plan constitutes a general unsecured obligation of BB&T; therefore, your rights under the Plan are no greater than the rights of an unsecured creditor of BB&T. The payment of benefits is subject to the risk of corporate insolvency. Enrollment June 1 is the start of Open Enrollment. All newly eligible participants who wish to participate in 2012 must go through the enrollment process. If you already participate in the Plan and do not wish to make changes, you do not need to take any action. To enroll, visit www.bbt.com/plantrac and follow the instructions on page 7 of this booklet. How long do you have to enroll? The Open Enrollment period for the 2012 Plan year starts Wednesday June 1, 2011, and ends Thursday, June 30, 2011. Remember: The next opportunity to elect to participate or change your deferral percentage in the Non-Qualified Plan will be June 2012 for the 2013 Plan year. Can you stop or change your contributions during the year? If you elect to participate in the Non-Qualified Plan, your deferral elections in the Non-Qualified Plan are irrevocable until the next Open Enrollment period. You may change your deferral election in the BB&T 401(k) Savings Plan at any time during 2012. How do you change your beneficiary designation? Beneficiary Designation Forms are available on the BB&T Benefits website at BBT.HRInTouch.com. To access the Non-Qualified Defined Contribution Plan Beneficiary Designation Form, log on to BBT.HRInTouch.com and click the Retirement tab. Next, scroll down on the Retirement page and click the Non-Qualified Plans link. Finally, click the Non-Qualified Defined Contribution Plan Beneficiary Form link. Please fill out the information requested, make a copy for your records, and return the original form to the address listed at the bottom of the form. The change will be effective upon receipt of the form. You may change your beneficiary designation at any time. Would you like to find out more about how your deferrals will be counted in the Non-Qualified Plan if you elect to participate beginning January 1, 2012? If so, look at the examples on pages 5 and 6. 4
EXAMPLE 1 Assumptions: $100,000 salary $20,000 bonus paid in February Employee elects to participate with a total deferral of 6% MONTHLY 401(k) 401(k) NON-QUALIFIED NON-QUALIFIED SALARY DEFERRAL MATCH DEFERRAL MATCH January $8,333.33 $500 $500 $0 $0 Bonus $20,000.00 $1,200 $1,200 $0 $0 February $8,333.33 $500 $500 $0 $0 March $8,333.34 $500 $500 $0 $0 April $8,333.33 $500 $500 $0 $0 May $8,333.33 $500 $500 $0 $0 June $8,333.34 $500 $500 $0 $0 July $8,333.33 $500 $500 $0 $0 August $8,333.33 $500 $500 $0 $0 September $8,333.34 $500 $500 $0 $0 October $8,333.33 $500 $500 $0 $0 November $8,333.33 $500 $500 $0 $0 December $8,333.34 $500 $500 $0 $0 Total $120,000 $7,200 $7,200 $0 $0 EXAMPLE 2 Assumptions: $100,000 salary $20,000 bonus paid in February Employee elects to participate with a total deferral of 25% MONTHLY 401(k) 401(k) NON-QUALIFIED NON-QUALIFIED SALARY DEFERRAL MATCH DEFERRAL MATCH January $8,333.33 $2,083.33 $500 $0 $0 Bonus $20,000.00 $5,000.00 $1,200 $0 $0 February $8,333.33 $2,083.33 $500 $0 $0 March $8,333.34 $2,083.33 $500 $0 $0 April $8,333.33 $2,083.33 $500 $0 $0 May $8,333.33 $2,083.33 $500 $0 $0 June $8,333.34 $1,083.35 $500 $1,000.00 $0 July $8,333.33 $0 $500 $2,083.33 $0 August $8,333.33 $0 $500 $2,083.33 $0 September $8,333.34 $0 $500 $2,083.34 $0 October $8,333.33 $0 $500 $2,083.33 $0 November $8,333.33 $0 $500 $2,083.33 $0 December $8,333.34 $0 $500 $2,083.34 $0 Total $120,000 $16,500 $7,200 $13,500 $0 Note: These examples use 2011 IRS limits. 5
EXAMPLE 3 Assumptions: $220,000 salary $50,000 bonus paid in February Employee elects to participate with a total deferral of 6% MONTHLY 401(k) 401(k) NON-QUALIFIED NON-QUALIFIED SALARY DEFERRAL MATCH DEFERRAL MATCH January $18,333 $1,100 $1,100 $0 $0 Bonus $50,000 $3,000 $3,000 $0 $0 February $18,333 $1,100 $1,100 $0 $0 March $18,334 $1,100 $1,100 $0 $0 April $18,333 $1,100 $1,100 $0 $0 May $18,333 $1,100 $1,100 $0 $0 June $18,334 $1,100 $1,100 $0 $0 July $18,333 $1,100 $1,100 $0 $0 August $18,333 $1,100 $1,100 $0 $0 September $18,334 $1,100 $1,100 $0 $0 October $18,333 $1,100 $1,100 $0 $0 November $18,333 $700 $700 $400 $400 December $18,334 $0 $0 $1,100 $1,100 Total $270,000 $14,700 $14,700 $1,500 $1,500 EXAMPLE 4 Assumptions: $220,000 salary $50,000 bonus paid in February Employee elects to participate with a total deferral of 25% MONTHLY 401(k) 401(k) NON-QUALIFIED NON-QUALIFIED SALARY DEFERRAL MATCH DEFERRAL MATCH January $18,333 $4,583 $1,100 $0 $0 Bonus $50,000 $11,917 $3,000 $583 $0 February $18,333 $0 $1,100 $4,583 $0 March $18,334 $0 $1,100 $4,584 $0 April $18,333 $0 $1,100 $4,583 $0 May $18,333 $0 $1,100 $4,583 $0 June $18,334 $0 $1,100 $4,584 $0 July $18,333 $0 $1,100 $4,583 $0 August $18,333 $0 $1,100 $4,583 $0 September $18,334 $0 $1,100 $4,584 $0 October $18,333 $0 $1,100 $4,583 $0 November $18,333 $0 $700 $4,583 $400 December $18,334 $0 $0 $4,584 $1,100 Total $270,000 $16,500 $14,700 $51,000 $1,500 Note: These examples use 2011 IRS limits. 6
HOW TO ENROLL ONLINE To make new elections for the Non-Qualified Plan for 2012, access www.bbt.com/plantrac on or before June 30, 2011. You can also log on from BBT.com by selecting the PlanTrac option under the Personal Services Logon drop-down menu. STEP 1 Log on to PlanTrac n Enter your User ID and Password, and click the Log On button. If you have not selected a User ID and Password, follow the instructions on the screen. STEP 2 Welcome to PlanTrac n Click on the circle beside BB&T Non-Qualified Deferred Compensation Plans. STEP 3 Summary n In the navigation on the left side of your screen, click to expand My Profile. Next, click the Annual Enrollment Election link. STEP 4 Non-Qualified Plan Enrollment Election n Select to participate or not to participate in the Non-Qualified Plan beginning January 1, 2012. Once you have made your election, click Continue. n If you elect not to participate, you will automatically go to Step 6. STEP 5 Contribution Election, Deferral Rate Syncing Election, Distribution Election, and Timing Election n If you elect to participate, you will be asked to input a deferral rate, elect to sync or not sync your deferral rate, specify your distribution method, and choose when you want your payment(s) to begin. Remember to choose the timing of your distribution carefully because it cannot be accelerated in future years. If you are a previous participant, your 2011 elections are pre-filled for you. To make a change to your deferral rate, simply type in the new rate (using whole numbers only). We will automatically sync your 2012 BB&T 401(k) Savings Plan election to match your non-qualified election, unless you elect not to sync your elections. To change your Distribution Election or Timing Election, click on the circle next to the corresponding option you choose. Since you cannot accelerate payments, you will only be presented with allowable timing options. Once you have made all your elections, click Continue. 7
STEP 6 Confirmation n Your final step is to confirm your elections. You must confirm your elections for your choices to be in effect January 1, 2012. If you select Make Changes, you will be taken back to the beginning of the enrollment process. When you confirm your elections, a confirmation letter will be mailed to your home address. Please note: n The deferral rate you elect will be effective January 1, 2012. n If you are a new participant, your Distribution and Timing Elections will also be effective January 1, 2012. n If you are a current participant, changes to your Distribution and Timing Elections do not become effective until one year following the date the elections are made. The new start date must be at least five years after the start date of the elections currently in place. 8
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