Attached files
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10-K - WEIS MARKETS, INC. 2011 ANNUAL REPORT ON FORM 10-K - WEIS MARKETS INC | wmk10k2011_10k.htm |
EX-21 - WEIS MARKETS, INC. 2011 ANNUAL REPORT ON FORM 10-K EXHIBIT 21 - WEIS MARKETS INC | wmk10k2011_ex21.htm |
EX-10.B - WEIS MARKETS, INC. 2011 ANNUAL REPORT ON FORM 10-K EXHIBIT 10-B - WEIS MARKETS INC | wmk10k2011_ex10-b.htm |
EXCEL - IDEA: XBRL DOCUMENT - WEIS MARKETS INC | Financial_Report.xls |
EX-31 - WEIS MARKETS, INC. 2011 ANNUAL REPORT ON FORM 10-K EXHIBIT 31.2 - WEIS MARKETS INC | wmk10k2011_ex31-2.htm |
EX-31.1 - WEIS MARKETS, INC. 2011 ANNUAL REPORT ON FORM 10-K EXHIBIT 31.1 - WEIS MARKETS INC | wmk10k2011_ex31-1.htm |
EX-23 - WEIS MARKETS, INC. 2011 ANNUAL REPORT ON FORM 10-K EXHIBIT 23 - WEIS MARKETS INC | wmk10k2011_ex23.htm |
EX-32 - WEIS MARKETS, INC. 2011 ANNUAL REPORT ON FORM 10-K EXHIBIT 32 - WEIS MARKETS INC | wmk10k2011_ex32.htm |
Weis
Markets, Inc. Retirement Savings Plan
Originally
Effective
July 1, 1994
As
Amended And Restated Effective
January 1, 2009
Weis
Markets, Inc. Retirement Savings Plan
PREAMBLE
This
amended and restated plan, executed on the date indicated at the end hereof, is
made effective as of January 1, 2009, except as provided otherwise in
Section 1.3(c), by Weis Markets, Inc., a corporation, with its principal
office located in Sunbury, Pennsylvania.
WITNESSETH:
WHEREAS,
effective July 1, 1994, the employer established the plan for its
employees and desires to continue to maintain a permanent qualified plan in
order to provide its employees and their beneficiaries with financial security
in the event of retirement, disability, or death; and
WHEREAS,
it is desired to amend said plan;
NOW
THEREFORE, the premises considered, the original plan is hereby replaced by this
amended and restated plan, and the following are the provisions of the qualified
plan of the employer as restated herein; provided, however, that each employee
who was previously a participant shall remain a participant, and no employee who
was a participant in the plan before the date of amendment shall receive a
benefit under this amended plan which is less than the benefit he was then
entitled to receive under the plan as of the day prior to the
amendment.
Copyright © 2006 by
Conrad Siegel
Actuaries
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1
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Weis
Markets, Inc. Retirement Savings Plan
ARTICLE
I – DEFINITIONS
Section
1.1 – References
(a)
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Code means the Internal
Revenue Code of 1986, as it may be amended from time to
time.
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(b)
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ERISA means the Employee
Retirement Income Security Act of 1974, as
amended.
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Section
1.2 – Compensation
(a)
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Compensation means,
except as provided in Section 1.2(b) hereof, any earnings reportable
as W-2 wages for federal income tax withholding purposes and earned
income, plus elective contributions, for the determination
period. For this purpose, the determination period is the plan
year. Such earnings shall include any amount contributed to a
Roth elective deferral account under this or any other qualified
plan. However, compensation shall not include any earnings
reportable as W-2 wages that are payable following the termination of
employment pursuant to a severance
agreement.
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Elective
contributions are amounts excludable from the employee’s gross income and
contributed by the employer, at the employee’s election to:
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·
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A
cafeteria plan (excludable under Code section 125 and as provided in
Section 5.1(c)(2));
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·
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A
Code section 401(k) arrangement (excludable under Code
section 402(e)(3));
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·
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A
simplified employee pension (excludable under Code
section 402(h));
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·
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A
tax sheltered annuity (excludable under Code
section 403(b));
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·
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A
deferred compensation plan excludable under Code section 457(b);
or
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·
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A
Code section 132(f)(4) qualified transportation fringe benefit
plan.
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"Earned
Income" means net earnings from self-employment in the trade or business with
respect to which the employer has established the plan, provided that personal
services of the individual are a material income producing
factor. Net earnings shall be determined without regard to items
excluded from gross income and the deductions allocable to those
items. Net earnings shall be determined after the deduction allowed
to the self-employed individual for all contributions made by the employer to a
qualified plan and, for plan years beginning after December 31, 1989,
the deduction allowed to the self-employed under Code section 164(f) for
self-employment taxes.
Any
reference in this plan to compensation shall be a reference to the definition in
this Section 1.2, unless the plan reference specifies a modification to
this definition. The plan administrator shall take into account only
compensation actually paid by the employer for the relevant period. A
compensation payment includes compensation by the employer through another
person under the common paymaster provisions in Code sections 3121
and 3306. Compensation from an employer that is not a
participating employer under this plan shall be excluded.
(b)
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Exclusions From
Compensation – Notwithstanding the provisions of
Section 1.2(a), the following types of remuneration shall be excluded
from the participant’s
compensation:
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(1)
Exclusions From Compensation for All Allocation Purposes:
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·
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Meal
Allowances
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·
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Auto
Personal Use
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·
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Sick
Pay
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·
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Stock
Appreciation Rights
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·
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Bonuses
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(2) Additional
Exclusions From Compensation for Profit Sharing Contribution Allocation
Purposes:
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·
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Compensation
in excess of $22,000 for Pharmacists with less than 10 years of
service.
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|
·
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Compensation
in excess of $24,000 for Pharmacists with 10 or more years of
service.
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Copyright © 2006 by
Conrad Siegel
Actuaries
|
2
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Weis
Markets, Inc. Retirement Savings Plan
(c)
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Limitations on
Compensation – For any plan year beginning after
December 31, 2001, the plan administrator shall take into
account only the first $200,000 (as adjusted for cost-of-living
increases in accordance with Code section 401(a)(17)(B) for plan
years beginning on or after January 1, 2003) of any
participant's annual compensation for determining all benefits provided
under the plan. If compensation for any prior determination
period is taken into account in determining a participant's allocations
for the current plan year, the compensation for such prior determination
period is subject to the applicable annual compensation limit in effect
for that prior period. For any plan year beginning after
December 31, 1993 but before January 1, 2002, the plan
administrator shall take into account only the first $150,000 (or, for
plan years beginning after December 31, 1994 but before
January 1, 2002, such larger amount as the Commissioner of
Internal Revenue may prescribe) of any participant's compensation for
determining all benefits provided under the plan. The
compensation dollar limitation for a plan year shall be the limitation
amount in effect on January 1 of the calendar year in which the plan
year begins. Annual compensation means compensation during the
plan year or such other 12-consecutive-month period over which
compensation is otherwise determined under the plan (the determination
period for purposes of Section 1.2). If the plan should
determine compensation on a period of time that contains less than
12 calendar months (such as for a short plan year), the annual
compensation dollar limitation shall be an amount equal to the
compensation dollar limitation for the plan year multiplied by the ratio
obtained by dividing the number of full months in the period
by 12.
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(d)
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Compensation for
Nondiscrimination Testing – For purposes of determining whether the
plan discriminates in favor of highly compensated employees, compensation
means compensation as defined in this Section 1.2, except that the
employer will not give effect to any exclusion from compensation specified
in Section 1.2(b).
|
For this
purpose, compensation shall include compensation paid by the employer as defined
under Section 1.5(b). Notwithstanding the above, the employer
may amend this plan to exclude from this nondiscrimination definition of
compensation any items of compensation excludable under Code section 414(s)
and the applicable Treasury regulations, provided such adjusted definition
conforms to the nondiscrimination requirements of those
regulations.
(e)
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Compensation for Compliance
with Section 5.5 – For purposes of conducting the actual
deferral percentage test or the actual contribution percentage test,
compensation means compensation as defined in Section 1.2(a) for the
entire determination period.
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Section
1.3 – Dates
(a)
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Accounting Date means
the date(s) on which investment results are allocated to participants’
accounts as set forth below:
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|
·
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With
respect to investment funds for which there is a daily market value, the
investment results shall be allocated on a daily basis. For
this purpose, daily means as of each business day on which the New York
Stock Exchange is open. The accounting date for dividends that
accrue on a daily basis but are paid monthly shall be the dividend
distribution date. The last day of each quarter shall be an
investment allocation date for all other
investments.
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(b)
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Allocation Date means
the date(s) as of which any contribution is allocated to participants'
accounts.
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The
profit sharing contribution and forfeitures shall be allocated as of
December 31.
The
allocation period for the profit sharing contribution shall be the plan
year.
Employer
matching contributions shall be allocated as of the last day of each payroll
period.
The
allocation period applicable to a particular employer matching contribution
allocation date shall be the period commencing as of the day following the
immediately previous allocation date and ending on the particular allocation
date.
Qualified
nonelective contributions shall be allocated as of
December 31.
The
allocation period for the qualified nonelective contribution shall be the plan
year.
Employee
contributions (whether elective deferrals or nondeductible) shall be allocated
as of the last day of each payroll period.
(c)
|
The
Effective Date of
the plan is July 1, 1994.
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Copyright © 2006 by
Conrad Siegel
Actuaries
|
3
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Weis
Markets, Inc. Retirement Savings Plan
The
effective date of this amendment and restatement is January 1, 2009;
provided, however, that the plan provision required to comply with the Family
and Medical Leave Act shall be effective August 5, 1993, the plan
provisions required to comply with the Uniformed Services Employment and
Re-Employment Rights Act of 1994 shall be effective
December 12, 1994, the plan provisions required to comply with the
Retirement Protection Act of 1994 shall generally be effective on the first
day of the first limitation year beginning after December 31, 1994,
the plan provisions required to comply with the Small Business Job Protection
Act of 1996 shall generally be effective on the first day of the plan year
beginning after December 31, 1996, the plan provisions required to
comply with the Taxpayer Relief Act of 1997 shall generally be effective on
the first day of the plan year beginning after August 5, 1997, and the
plan provisions required to comply with the Economic Growth and Tax Relief
Reconciliation Act of 2001 shall generally be effective as of the first day
of the first plan year beginning after December 31, 2001, except as
specified otherwise in this plan or in said Acts.
Notwithstanding
anything herein to the contrary, the provisions noted below shall become
effective on the date indicated. The prior provisions of the plan
shall continue in effect until such indicated effective date.
Provision
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Effective Date
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Section
1.2(b) Exclusions from Compensation
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December
1, 2009
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Section
1.3(a) Accounting Date
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October
1, 2009
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Section
1.3(b) Allocation Date
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October
1, 2009
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Section
1.10(c)(3) Predecessor Service
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October
1, 2009
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Section
2.2 Plan Participation
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December
1, 2009
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Sections
3.2 and 3.2(A)
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December
1, 2009
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Section
3.6(c) Conditions for Allocations
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October
1, 2009
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Section
3.8(b) Investment Elections
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October
1, 2009
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Section
4.2(a)(6)(A) Profit Sharing Account
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December
1, 2009
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Section
4.2(c)(1) Profit Sharing Account
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December
1, 2009
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Section
4.3(a)(3) Payment Upon Other Termination of Employment
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October
1, 2009
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Section
4.3(b) Form of Payment
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October
1, 2009
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Section
4.3(c)(1) General Payment Provisions
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October
1, 2009
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Section
4.4(a) Withdrawals
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December
1, 2009
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The
$5,000 dollar amount appearing in Sections 4.2(b), 4.2(c), 4.3(d), 4.4(b)
and 4.5 shall be effective for plan years beginning after
December 31, 1997. Prior to such effective date, the dollar
amount shall be $3,500 as provided under the prior provisions of the
plan.
(d)
|
Plan Entry Date means
the participation date(s) specified in
Article II.
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(e)
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Plan Year means the
12-consecutive-month period beginning on January 1 and ending on
December 31.
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(f)
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Limitation Year means
the 12-consecutive-month period beginning on January 1 and ending on
December 31.
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Section
1.4 – Employee
(a)
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(1)
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Employee means any
person employed by the employer, including an owner-employee or other
self-employed individual (as defined in
Section 1.4(a)(3)). The term employee shall include any
employee of the employer as defined in Section 1.5(b). The
term employee shall also include any leased employee deemed to be an
employee of any such employer as provided in Code section 414(n) or
(o) and as defined in
Section 1.4(a)(2).
|
|
(2)
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Leased Employee means an
individual (who otherwise is not an employee of the employer) who,
pursuant to a leasing agreement between the employer and any other person,
has performed services for the employer (or for the employer and any
persons related to the employer within the meaning of Code
section 414(n)(6)) on a substantially full time basis for at least
one year and such services are performed under the primary direction or
control of the employer. If a leased employee is treated as an
employee by reason of this Section 1.4(a)(2), compensation from the
leasing organization that is attributable to services performed for the
employer shall be considered as compensation under the
plan. Contributions or benefits provided a leased employee by
the leasing organization that are attributable to services performed for
the employer shall be treated as provided by the
employer.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
4
|
Weis
Markets, Inc. Retirement Savings Plan
Safe
harbor plan exception – The plan shall not treat a leased employee as an
employee if the leasing organization covers the employee in a safe harbor plan
and, prior to application of this safe harbor plan exception, 20% or less of the
employer's nonhighly compensated employees are leased employees. A safe harbor
plan is a money purchase pension plan providing immediate participation, full
and immediate vesting, and a nonintegrated contribution formula equal to at
least 10% of the employee's compensation without regard to employment by the
leasing organization on a specified date. The safe harbor plan must determine
the 10% contribution on the basis of compensation as defined in Section
5.1(c)(2).
|
(3)
|
Owner-Employee/Self-Employed
Individual – Owner-employee means a self-employed individual who is
a sole proprietor (if the employer is a sole proprietorship) or who is a
partner (if the employer is a partnership) owning more than 10% of either
the capital or profits interest of the
partnership. Self-employed individual means an individual who
has earned income for the taxable year from the trade or business for
which the plan is established, or who would have had earned income but for
the fact that the trade or business had no net profits for the taxable
year.
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(b)
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Highly Compensated
Employee means any employee
who:
|
|
(1)
|
was
a more than 5% owner of the employer (applying the constructive ownership
rules of Code section 318, and applying the principles of Code
section 318, for an unincorporated entity) at any time during the
current plan year or the look-back year;
or
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|
(2)
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for
the look-back year –
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(A)
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had
compensation from the employer (as defined under Section 1.5(b)) in
excess of $80,000 (as adjusted by the Commissioner of Internal Revenue
pursuant to Code section 415(d), except that the base period shall be
the calendar quarter ending September 30, 1996),
and
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|
(B)
|
if
the employer elects the application of this Subparagraph for such
look-back year, was in the top-paid group of employees for such look-back
year. For this purpose, an employee is in the top-paid group of
employees for any look-back year if such employee is in the group
consisting of the top 20% of the employees when ranked on the basis of
compensation paid during such look-back
year.
|
The
look-back year is the twelve-month period immediately preceding the current plan
year. The term highly compensated employee also includes any former
employee who separated from service (or has a deemed separation from service, as
determined under Treasury regulations) prior to the plan year, performs no
service for the employer during the plan year, and was a highly compensated
employee either for the separation plan year or any plan year ending on or after
his 55th birthday, based on the applicable rules in effect for such plan
year.
For
purposes of determining who is a highly compensated employee under this
Section 1.4(b), compensation means compensation as defined in
Section 1.2(a) without regard to Section 1.2(b).
The plan
administrator shall make the determination of who is a highly compensated
employee.
This
Section 1.4(b) is effective for plan years beginning after
December 31, 1996, except that, in determining whether an employee is
a highly compensated employee in 1997, this provision shall be treated as having
been in effect for the last plan year beginning before
January 1, 1997.
(c)
|
Nonhighly Compensated
Employee means any employee who is not a highly compensated
employee.
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Section
1.5 – Employer
(a)
|
Employer means Weis
Markets, Inc. or any successor entity by merger, purchase, consolidation,
or otherwise; or an organization affiliated with the employer that may
assume the obligations of this plan with respect to its employees by
becoming a party to this plan. Another employer, whether or not
it is affiliated with the sponsor employer, may adopt this plan to cover
its employees by filing with the sponsor employer a written resolution
adopting the plan, upon which the sponsor employer shall indicate its
acceptance of such employer as an employer under the plan. Each
such employer shall be deemed to be the employer only as to persons who
are on its payroll.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
5
|
Weis
Markets, Inc. Retirement Savings Plan
The
following employers have adopted this plan and have been accepted by the sponsor
employer on or before the date this document is executed:
SuperPetz,
LLC
(b)
|
Employer for Compliance
Testing – For purposes of determining whether the plan satisfies
the participation coverage requirements of Code section 410(b) and
the limitations on benefits and allocations under Code section 415,
employer shall mean the employer that adopts this plan as set forth in
Section 1.5(a), and all members of a controlled group of corporations
(as defined in Code section 414(b)), all commonly controlled trades
or businesses (as defined in Code section 414(c)) or affiliated
service groups (as defined in Code section 414(m)) of which the
adopting employer is a part, and any other entity required to be
aggregated with the employer pursuant to regulations under Code
section 414(o).
|
Section
1.6 – Fiduciaries
(a)
|
Named Fiduciary means
the person or persons having fiduciary responsibility for the management
and control of plan assets.
|
(b)
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Plan Administrator means the
person or persons appointed by the named fiduciary to administer the
plan.
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(c)
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Trustee means the
trustee named in the trust agreement executed pursuant to this plan, or
any duly appointed successor
trustee.
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(d)
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Investment Manager means
a person or corporation other than the trustee appointed for the
investment of plan assets.
|
Section
1.7 – Participant/Beneficiary/Spouse/Dependent
(a)
|
Participant means an
eligible employee of the employer who becomes a member of the plan
pursuant to the provisions of Article II, or a former employee who
has an accrued benefit under the plan. A participant shall be
treated as benefiting under the plan for any plan year during which the
participant received or is deemed to receive an allocation in accordance
with Regulation
section 1.410(b)-3(a).
|
(b)
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Beneficiary means a
person designated by a participant who is or may become entitled to a
benefit under the plan. A beneficiary who becomes entitled to a
benefit under the plan remains a beneficiary under the plan until the
trustee has fully distributed his benefit to him. A
beneficiary's right to (and the plan administrator's, or a trustee's duty
to provide to the beneficiary) information or data concerning the plan
shall not arise until he first becomes entitled to receive a benefit under
the plan.
|
(c)
|
Spouse means the person
of the opposite sex married to the participant at the time of the
determination and as further defined by section 3 of the Defense of
Marriage Act, 1 U.S.C. § 7
(1996).
|
(d)
|
Dependent means a
dependent as defined by Code section 152 without regard to
section 152(d)(1)(B).
|
Section
1.8 – Participant Accounts
(a)
|
Profit Sharing Account
means the balance of the separate account derived from employer’s profit
sharing contributions, including forfeitures (if any) (if so provided
under Section 3.2).
|
(b)
|
Qualified Nonelective
Contribution Account means the balance of the separate account
derived from employer's qualified nonelective contributions (if so
provided under Section 3.3).
|
(c)
|
Employee 401(k) Elective
Deferral Account means the balance of the separate account derived
from the participant's 401(k) elective deferrals (if so provided under
Section 3.4).
|
(d)
|
Employee Nondeductible
Contribution Account means the balance of the separate account
derived from the participant’s non-deductible employee contributions (if
so provided under
Section 3.5).
|
(e)
|
Employer Matching Contribution
Account means the balance of the separate account derived from
employer's matching contributions (if so provided under
Section 3.6).
|
|
(f)
|
Qualified Employer Matching
Contribution Account means the balance of the separate account
derived from employer's qualified matching contributions (if so provided
under Section 3.6).
|
(g)
|
Rollover/Transfer
Account means the balance of the separate account derived from
rollover contributions and/or transfer contributions (if so provided under
Section 3.7).
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
6
|
Weis
Markets, Inc. Retirement Savings Plan
(h)
|
Accrued Benefit means
the total of the participant’s account balances as of the accounting date
falling on or before the day on which the accrued benefit is being
determined.
|
Section
1.9 – Plan
Plan means Weis Markets, Inc.
Retirement Savings Plan as set forth herein and as it may be amended from time
to time.
Section
1.10 – Service
(a)
|
Service means any period
of time the employee is in the employ of the employer, including any
period the employee is on an unpaid leave of absence authorized by the
employer under a uniform, nondiscriminatory policy applicable to all
employees. Separation from service means that the employee no
longer has an employment relationship with the
employer.
|
(b)
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(1)
|
Hour of Service
means:
|
|
(A)
|
Each
hour for which an employee is paid, or entitled to payment, for the
performance of duties for the employer. These hours shall be
credited to the employee for the computation period in which the duties
are performed; and
|
|
(B)
|
Each
hour for which an employee is paid, or entitled to payment, by the
employer on account of a period of time during which no duties are
performed (irrespective of whether the employment relationship has
terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty, military duty, or leave of
absence. No more than 501 hours of service shall be
credited under this Subparagraph (B) for any single continuous period
(whether or not such period occurs in a single computation
period). An hour of service shall not be credited to an
employee under this Subparagraph (B) if the employee is paid, or
entitled to payment, under a plan maintained solely for the purpose of
complying with applicable worker's compensation or unemployment
compensation or disability insurance laws. Hours under this
Subparagraph (B) shall be calculated and credited pursuant to
section 2530.200b-2 of the Department of Labor Regulations that are
incorporated herein by this reference;
and
|
|
(C)
|
Each
hour for which back pay, irrespective of mitigation of damages, is either
awarded or agreed to by the employer. The same hours of service
shall not be credited both under Subparagraph (A) or
Subparagraph (B), as the case may be, and under this
Subparagraph (C). These hours shall be credited to the
employee for the computation period or periods to which the award or
agreement pertains rather than the computation period in which the award,
agreement, or payment is made.
|
Hours of
service shall be determined on the basis of actual hours for which an employee
is paid or entitled to payment. The above provisions shall be
construed so as to resolve any ambiguities in favor of crediting employees with
hours of service.
If, for
the purposes of the plan, an employee's records are maintained on other than an
hourly basis, the plan administrator, according to uniform rules applicable to a
class of employees, may apply the following equivalencies for the purpose of
crediting hours of service:
Basis
Upon Which Records
Are
Maintained
|
Credit
Granted to Individual if Individual Earns One
or
More Hours of Service During Period
|
|
Shift
|
Actual
hours of full shift
|
|
Day
|
10
hours of service
|
|
Week
|
45
hours of service
|
|
Semi-Monthly
Payroll Period
|
95
hours of service
|
|
Months
of Employment
|
190
hours of service
|
|
(2)
|
Solely
for purposes of determining whether a break in service for participation
and vesting purposes has occurred in a computation period, an individual
who is absent from work for maternity or paternity reasons shall receive
credit for the hours of service that would otherwise have been credited to
such individual but for such absence, or in any case in which such hours
cannot be determined, 8 hours of service per day of such
absence. For purposes of this paragraph, an absence from work
for maternity or paternity reasons means an absence (A) by reason of
the pregnancy of the individual, (B) by reason of a birth of a child
of the individual, (C) by reason of the placement of a child with the
individual in connection with the adoption of such child by such
individual, or (D) for purposes of caring for such child for a period
beginning immediately following such birth or placement. The
hours of service credited under this paragraph shall be
credited: (A) in the computation period in which the
absence begins if the crediting is necessary to prevent a break in service
in that period, or (B) in all other cases, in the following
computation period. No more than 501 hours of service
shall be credited under this paragraph for any single continuous period
(whether or not such period occurs in a single computation
period).
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
7
|
Weis
Markets, Inc. Retirement Savings Plan
|
(3)
|
Solely
for purposes of determining whether a break in service for participation
and vesting purposes has occurred in a computation period, an individual
who is absent from work on unpaid leave under the Family and Medical Leave
Act shall receive credit for the hours of service that would otherwise
have been credited to such individual but for such absence, or in any case
in which such hours cannot be determined, 8 hours of service per day
of such absence. Such an individual shall be treated as
actively employed for the purposes of participation and eligibility for an
allocation of any employer contribution that may be provided under this
plan. Notwithstanding the preceding, this paragraph shall not
apply if the employer or the particular employee is not subject to the
requirements of the Family and Medical Leave Act at the time of the
absence.
|
|
(4)
|
Hours
of service shall be credited for employment with the employer as defined
in Section 1.5(b). Hours of service shall also be credited
for any leased employee who is considered an employee for purposes of this
plan under Code section 414(n) or Code
section 414(o).
|
(c)
|
(1)
|
Year of Service means a
12-consecutive-month computation period during which the employee
completes the required number of hours of service with the employer as
specified in Sections 2.1 or 4.1. No more than one
year of service will be credited for any 12-consecutive-month period
unless otherwise required by Sections 2.1(c)
and 4.1(c).
|
|
(2)
|
Service With Related
Employers – For purposes of crediting years of service, hours of
service credited in accordance with Section 1.10(b)(4) shall be taken
into account.
|
|
(3)
|
Predecessor Service – If
the employer maintains the plan of a predecessor employer, service with
such predecessor employer shall be treated as service for the
employer. If the employer does not maintain the plan of a
predecessor employer, then service as an employee of a predecessor
employer shall not be considered as service under the plan, except as
noted below:
|
|
·
|
Effective
November 18, 1994, with respect to an employee employed by the
predecessor employer as of the day immediately prior, service as an
employee of Kings Markets, Strasburg store (Store No. 159) shall be
considered as service under the plan solely for the purpose of determining
eligibility years of service (under
Section 2.1).
|
|
·
|
Effective
August 24, 2009, with respect to an employee employed by the predecessor
employer as of the day immediately prior, service as an employee of
Binghamton Giant Markets, Inc. shall be considered as service under the
plan for the purposes of determining eligibility years of service (under
Section 2.1) and vesting years of service (under
Section 4.1).
|
(d)
|
Break in Service (or One
Year Break in Service) means a 12-consecutive-month computation period
during which a participant or former participant does not complete the
specified number of hours of service with the employer as set forth in
Sections 2.1(b)
and 4.1(b).
|
(e)
|
Qualified Military
Service – Notwithstanding any provision of this plan to the
contrary, effective December 12, 1994, contributions, benefits,
and service credit with respect to qualified military service will be
provided in accordance with Code section 414(u). An
employee reemployed after qualified military service shall not be treated
as having incurred a break in service, for purposes of vesting and benefit
accruals, solely because of an absence due to qualified military
service.
|
Section
1.11 – Trust
(a)
|
Trust means the
qualified trust created under the employer’s
plan.
|
(b)
|
Trust Fund means all
property held or acquired by the
plan.
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Copyright © 2006 by
Conrad Siegel
Actuaries
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8
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Weis
Markets, Inc. Retirement Savings Plan
ARTICLE
II – PARTICIPATION
Section
2.1 – Eligibility Service
(a)
|
Eligibility Year of
Service means an eligibility computation period during which the
employee completes at least 1,000 hours of service with the
employer.
|
(b)
|
One Year Break in
Service means for the purposes of this Article II an
eligibility computation period during which the participant or former
participant does not complete more than 500 hours of service with the
employer.
|
(c)
|
Eligibility Computation
Period – The initial eligibility computation period shall be the
12-consecutive-month period beginning with the day on which the employee
first performs an hour of service for the employer (employment
commencement date).
|
Succeeding
eligibility computation periods shall coincide with the plan year, beginning
with the first plan year that commences prior to the first anniversary of the
employee's employment commencement date regardless of whether the employee is
credited with the required number of hours of service during the initial
eligibility computation period. An employee who is credited with the
required number of hours of service in both the initial eligibility computation
period and the first plan year that commences prior to the first anniversary of
the employee's employment commencement date shall be credited with two years of
service for purposes of eligibility to participate.
Section
2.2 – Plan Participation
(a)
|
Eligibility
|
|
(1)
|
Eligibility for Employer Profit
Sharing Contributions
|
|
(A)
|
Age/Service Requirements
– An employee who is a member of the eligible class of employees shall be
eligible for participation for the purpose of the employer profit sharing
provision after he has satisfied the following participation
requirement(s):
|
|
(i)
|
Completion
of 1 year of service.
|
|
(ii)
|
Attainment
of age 21.
|
|
(B)
|
Eligible Class of
Employees – All employees of the employer except those described in
(i), (ii), (iii), (iv), (v), (vi), (vii), and (viii) below shall be
eligible for purposes of receiving a profit sharing allocation if employed
in the following categories: Salaried Employee, Level I
Department Manager, Head Pharmacist, Assistant Head Pharmacist, Foreman,
Corporate Lead Person, Corporate Department Assistant, Corporate
Administrative Assistant, Corporate Reorder Buyer, or Corporate
Architectural Draftsperson.
|
|
(i)
|
Individuals
not directly employed by the employer as defined in Section 1.5(a)
shall not be eligible to receive a profit sharing
contribution. An employee of the employer as that term is
defined in Section 1.5(b) with respect to the sponsoring employer
shall not be eligible to receive a profit sharing allocation unless such
employee's direct employer affirmatively elects to become a participating
employer hereunder.
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|
(ii)
|
Employees
who became employees as the result of a “Code section 410(b)(6)(C)
transaction.” These employees shall be excluded during the
period beginning on the date of the transaction and ending on the last day
of the first plan year beginning after the date of the
transaction. A “Code section 410(b)(6)(C) transaction” is
an asset or stock acquisition, merger, or similar transaction involving a
change in the employer of the employees of a trade or
business.
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|
(iii)
|
Employees
included in a unit of employees covered by a collective bargaining
agreement between the employer and employee representatives shall not be
eligible to receive a profit sharing allocation if retirement benefits
were the subject of good faith bargaining and if less than 2% of the
employees of the employer who are covered pursuant to that agreement are
professionals as defined in Regulation section
1.410(b)-9(g). For this purpose, the term "employee
representatives" does not include any organization more than half of whose
members are employees who are owners, officers, or executives of the
employer.
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Copyright © 2006 by
Conrad Siegel
Actuaries
|
9
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Weis
Markets, Inc. Retirement Savings Plan
|
(iv)
|
Leased
employees who are considered employees under the plan shall not be
eligible to receive a profit sharing
allocation.
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|
(v)
|
Employees
who are non-resident aliens (as defined in Code
section 7701(b)(1)(B)) and who receive no earned income (as defined
in Code section 911(d)(2)) from the employer that constitutes income
from sources within the United States (as defined in Code
section 861(a)(3)) shall not be eligible to receive a profit sharing
allocation.
|
|
(vi)
|
Highly
compensated employees as defined in Section 1.4(b) shall not be eligible
to receive a profit sharing
allocation.
|
|
(vii)
|
Employees
of Superpetz, LLC shall not be eligible to receive a profit sharing
allocation.
|
|
(viii)
|
Employees
of Binghamton Giant Markets, Inc. shall not be eligible to receive a
profit sharing allocation prior to January 1,
2010.
|
Notwithstanding
the above eligible class of employees, the eligible class provisions of the plan
before January 1, 2009 shall continue to apply to participants who received
profit sharing allocations before January 1, 2009, and to employees who
otherwise would have become participants in the Plan by December 31,
2009.
|
(2)
|
Eligibility for All Other
Purposes
|
|
(A)
|
Age/Service Requirements
– An employee who is a member of the eligible class of employees shall be
eligible for all other purposes under the plan after he has satisfied the
following participation
requirement(s):
|
|
(i)
|
Completion
of 1 year of service.
|
|
(ii)
|
Attainment
of age 21.
|
|
(B)
|
Eligible Class of
Employees – All employees of the employer shall be eligible for the
purposes of this Section 2.2(a)(2) except for employees in the
following categories:
|
|
·
|
Individuals
not directly employed by the employer as defined in
Section 1.5(a). An employee of the employer as that term
is defined in Section 1.5(b) with respect to the sponsoring employer
shall not participate in this plan unless such employee's direct employer
affirmatively elects to become a participating employer
hereunder.
|
|
·
|
Employees
who became employees as the result of a “Code section 410(b)(6)(C)
transaction.” These employees shall be excluded during the
period beginning on the date of the transaction and ending on the last day
of the first plan year beginning after the date of the
transaction. A “Code section 410(b)(6)(C) transaction” is
an asset or stock acquisition, merger, or similar transaction involving a
change in the employer of the employees of a trade or
business.
|
|
·
|
Employees
included in a unit of employees covered by a collective bargaining
agreement between the employer and employee representatives if retirement
benefits were the subject of good faith bargaining and if 2% or less of
the employees of the employer who are covered pursuant to that agreement
are professionals as defined in Regulation
section 1.410(b)-9. For this purpose, the term “employee
representatives” does not include any organization more than half of whose
members are employees who are owners, officers, or executives of the
employer.
|
|
·
|
Leased
employees who are considered employees under the
plan.
|
|
·
|
Employees
who are non-resident aliens (as defined in Code
section 7701(b)(1)(B)) and who receive no earned income (as defined
in Code section 911(d)(2)) from the employer that constitutes income
from sources within the United States (as defined in Code
section 861(a)(3)).
|
(b)
|
Entry
Date
|
|
(1)
|
Entry Date for Purposes of
Employer Profit Sharing Contributions – An eligible employee shall
participate in the plan for the purpose of the employer profit sharing
contribution provisions on the earlier of the March 31, June 30,
September 30, or December 31 coinciding with or immediately
following the date on which he has met the age and service requirements,
provided he is employed on that
date.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
10
|
Weis
Markets, Inc. Retirement Savings Plan
|
(2)
|
Entry Date for All Other
Purposes – An eligible employee shall participate in the plan for
all purposes on the earlier of the March 31, June 30,
September 30, or December 31 coinciding with or immediately
following the date on which he has met the age and service requirements,
provided he is employed on that
date.
|
|
(3)
|
If
an employee who is not a member of the eligible class of employees becomes
a member of the eligible class, such employee shall participate
immediately, if he has satisfied the age and service requirements and
would have otherwise previously become a
participant.
|
Section
2.3 – Termination of Participation
A
participant shall continue to be an active participant of the plan so long as he
is a member of the eligible class of employees and he does not terminate
employment. He shall become an inactive participant when he
terminates employment or ceases to be a member of the eligible class of
employees. He shall cease participation completely upon the later of
his receipt of a total distribution of his nonforfeitable account balance(s)
under the plan or the forfeiture of the nonvested portion of the account
balance(s).
Section
2.4 – Re-Participation or Re-Employment (Break in Service Rules)
(a)
|
Vested Participant – A
former participant who had a nonforfeitable right to all or a portion of
his account balance derived from employer contributions at the time of his
termination from service shall become a participant immediately upon
returning to the employ of the employer, if he is a member of the eligible
class of employees.
|
(b)
|
Nonvested Participant or
Employee – In the case of an employee who does not have any
nonforfeitable right to his account balance derived from employer
contributions at the time of his termination from service, years of
service before a period of consecutive one-year breaks in service shall
not be taken into account in computing eligibility service if the number
of consecutive one-year breaks in service in such period equals or exceeds
the greater of 5 or the aggregate number of years of service before
such breaks in service. Such aggregate number of years of
service shall not include any years of service disregarded under the
preceding sentence by reason of prior breaks in
service.
|
If an
employee's years of service before termination from service are disregarded
pursuant to the preceding paragraph, he shall be considered a new employee for
eligibility purposes. If such employee's years of service before
termination from service may not be disregarded pursuant to the preceding
paragraph, he shall participate immediately upon returning to the employ of the
employer, if he is a member of the eligible class of employees and has otherwise
satisfied the age and service requirements of Section 2.2.
(c)
|
Return to Eligible Class
– If a participant becomes an inactive participant, because he is no
longer a member of the eligible class of employees, but does not incur a
break in service, such inactive participant shall become an active
participant immediately upon returning to the eligible class of
employees. If such participant incurs a break in service,
eligibility shall be determined under the re-participation rules in
Section 2.4(a) and (b)
above.
|
ARTICLE
III – ALLOCATIONS TO PARTICIPANT ACCOUNTS
Section
3.1 – General Provisions
(a)
|
Maintenance of Participant
Accounts – The plan administrator shall maintain separate accounts
covering each participant under the plan as herein
described. Such accounts shall be increased by contributions,
reallocation of forfeitures (if any), investment income, and market value
appreciation of the fund. They shall be decreased by market
value depreciation of the fund, forfeiture of nonvested amounts, benefit
payments, withdrawals, and
expenses.
|
(b)
|
Amount and Payment of Employer
Contribution
|
|
(1)
|
Amount of Contribution –
For each plan year, the employer contribution to the plan shall be the
amount that is determined under the provisions of this Article; provided,
however, that the employer may not make a contribution to the plan for any
plan year to the extent the contribution would exceed the participants'
maximum permissible amounts under Code
section 415. Further, the employer contribution shall not
exceed the maximum amount deductible under Code section 404, subject
to the provisions for a nondeductible contribution without penalty as
permitted under Code section 4972(c)(6). For this purpose,
effective for plan years beginning on or after January 1, 2002,
participant elective deferrals shall not be taken into account as provided
under Code section 404(n).
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
11
|
Weis
Markets, Inc. Retirement Savings Plan
The
employer contributes to this plan on the conditions that its contribution is not
due to a mistake of fact and that the Internal Revenue Service will not disallow
the deduction for its contribution. The trustee, upon written request
from the employer, shall return to the employer the amount of the employer's
contribution made due to a mistake of fact or the amount of the employer's
contribution disallowed as a deduction under Code section 404. The trustee
shall not return any portion of the employer's contribution under the provisions
of this paragraph more than one year after the earlier
of: (A) The date on which the employer made the contribution due
to a mistake of fact; or (B) The time of disallowance of the contribution
as a deduction, and then, only to the extent of the disallowance. The
trustee will not increase the amount of the employer contribution returnable
under this Section for any earnings attributable to the contribution, but the
trustee will decrease the employer contribution returnable for any losses
attributable to it. The trustee may require the employer to furnish whatever
evidence it deems necessary to confirm that the amount the employer has
requested be returned is properly returnable under ERISA.
|
(2)
|
Payment of Contribution
– The employer shall make its contribution to the plan in cash within the
time prescribed by the Code or applicable Treasury
regulations. Subject to the consent of the trustee, the
employer may make its contribution in property rather than in cash,
provided the contribution is discretionary and the property contributed is
unencumbered.
|
|
(3)
|
Allocation if More Than One
Employer – If the employer consists of a sponsoring employer and
one or more participating employers, the contribution made by each such
entity shall be allocated to the accounts of the participants directly
employed by the contributing employer. If a participant is
employed by more than one entity during the applicable period, each entity
shall contribute with respect to the compensation earned by the
participant while employed by that
entity.
|
(c)
|
Limitations and
Conditions – Notwithstanding the allocation procedures set forth in
this Article, the allocations to participants' accounts shall be limited
or modified to the extent required to comply with the provisions of
Article V (limitations on allocations under Code section 415,
top-heavy provisions under Code section 416, and related employer
provisions under Code
section 414).
|
In any
limitation year in which the allocation to one or more participants' accounts
would be in excess of the limitations on allocations under Code
section 415, the annual additions under this plan will be reduced to the
extent necessary to comply with such limitations first. If any
further reduction is required in any limitation year commencing before
January 1, 2000, the annual additions or benefits under any other plan
that the employer sponsors will then be reduced with respect to such
participants. If any further reduction is required in any limitation
year commencing on or after January 1, 2000, the annual additions
under any other defined contribution plan that the employer sponsors will then
be reduced with respect to such participants.
Section
3.2 – Regular Profit Sharing Contributions
(a)
|
Amount of Contribution –
The employer shall determine, in its sole discretion, the amount of
employer profit sharing contribution to be made to the plan each year;
provided, however, that the employer shall contribute such amount as may
be required for restoration of a forfeited amount under
Section 4.2.
|
(b)
|
Conditions for
Allocations – A participant shall be eligible for an allocation of
the employer profit sharing contribution and forfeitures as of an
allocation date, provided that he satisfies the following
conditions:
|
|
(1)
|
He
completed at least 1,000 hours of service during the current plan
year, except that the hours of service requirement shall not apply with
respect to any minimum top-heavy allocation as provided in
Section 5.4.
|
AND
|
(2)
|
He
is employed by the employer on the last day of the plan
year.
|
AND
|
(3)
|
He
is not a Highly Compensated
Employee.
|
AND
Copyright © 2006 by
Conrad Siegel
Actuaries
|
12
|
Weis
Markets, Inc. Retirement Savings Plan
|
(4)
|
He
is employed in one of the eligible job categories listed in Section
2.2(a)(1)(B) on the last day of the plan
year.
|
In the
event a minimum top-heavy allocation is required to be made as an employer
profit sharing contribution under the provisions of Section 3.2(c)(2),
solely for this limited purpose active participant shall include any person
participating under the provision of Section 2.2(b)(2) and not yet eligible
to participate in the plan for purposes under
Section 2.2(b)(1).
(c)
|
(1)
|
Allocation
Formula
|
The
employer profit sharing contribution and forfeitures for the plan year shall be
allocated to the profit sharing account of each eligible participant in the
ratio that each participant's number of allocation units bears to the allocation
units of all participants. A participant shall be credited with one
allocation unit for each full $100.00 of compensation for the plan year, plus
1.5 units for each year of service.
|
(2)
|
Top-Heavy Plan
Years
|
In any
plan year in which this plan is top-heavy (as defined in
Section 5.4(e)(2)), the top-heavy minimum benefit requirement with respect
to a participant shall first be met by any allocation to the Qualified
Nonelective Contribution Account for the plan year. Then, the
contributions and forfeitures allocable to the profit sharing account shall be
adjusted as necessary for compliance. The total of the contributions
and forfeitures allocated to such account(s) of each participant shall not be
less than an amount equal to 3% of his compensation or the largest percentage of
elective deferral contribution, employer contribution, and forfeiture allocated
on behalf of any key employee for that year, whichever is less.
|
(3)
|
Compensation – For
purposes of the allocation of the employer profit sharing contribution,
compensation means compensation as defined in Section 1.2(a)
and (b) (subject to the limitations of Section 1.2(c)) for the
entire plan year.
|
However,
for purposes of the top-heavy contribution, compensation means compensation as
defined in Section 5.1(c)(2), subject to the limitations of
Section 1.2(c).
Section
3.2 (A) – Special Profit Sharing Contribution as of December 31,
2009
(a)
|
Amount of Contribution –
The employer shall determine, in its sole discretion, the amount of
special employer profit sharing contribution to be made to the plan as of
December 31, 2009.
|
(b)
|
Conditions for
Allocations – A participant shall be eligible for an allocation of
the special employer profit sharing contribution as of December 31, 2009,
provided that he satisfies the following
conditions:
|
|
(1)
|
He
is employed by the employer on December 31,
2008.
|
AND
|
(2)
|
He
is not a Highly Compensated Employee in
2009.
|
AND
|
(3)
|
He
is employed by the employer on December 31,
2009.
|
(c)
|
Allocation
Formula
|
The
special employer profit sharing contribution for 2009 shall be allocated to the
profit sharing account of each eligible participant in the ratio that each
eligible participant's plan account balance as of December
31, 2008 bears to the plan account balance as of December 31, 2008 of all
eligible participants.
Section
3.3 – Qualified Nonelective Contributions
To the
extent the current year testing method is being used to satisfy the requirements
described in Section 5.5(b) and (c), the employer may make qualified
nonelective contributions on behalf of either the nonhighly compensated active
participants or all active participants that are sufficient to satisfy either
the actual deferral percentage test or the actual contribution percentage test,
or both, pursuant to regulations under the Code in lieu of distributing excess
contributions as provided in Section 5.5(b)(2) of the plan, or excess
aggregate contributions as provided in Section 5.5(c)(2) of the
plan. The employer may elect to comply with the ADP test requirements
by making safe harbor nonelective contributions on behalf of all active
participants as described in Section 5.5(f).
Copyright © 2006 by
Conrad Siegel
Actuaries
|
13
|
Weis
Markets, Inc. Retirement Savings Plan
Qualified
nonelective contributions are contributions (other than profit sharing
contributions or employer matching contributions) that are made by the employer
and allocated to participants' qualified nonelective contribution accounts and
any forfeitures that are so applied that the participants may not elect to
receive in cash until distributed from the plan; that are nonforfeitable when
made; and that are distributable only in accordance with the distribution
provisions that are applicable to elective deferrals and qualified matching
contributions. Safe harbor nonelective contributions shall be
allocated to a safe harbor sub-account of the qualified nonelective contribution
account and shall be held subject to the same rights and
restrictions.
(a)
|
Amount of
Contribution
|
The
amount of such contributions for each plan year shall be an amount determined by
the employer, in its sole discretion, after the plan administrator has
determined the amount needed to satisfy the actual deferral percentage test or
the actual contribution percentage test, or both.
(b)
|
Allocation of
Contribution
|
|
(1)
|
Allocation
of the qualified nonelective contribution shall be made to the group of
eligible non-highly compensated employees that consists of half of all
eligible non-highly compensated employees for the plan year determined by
identifying the nonhighly compensated employee with the smallest amount of
compensation and continuing in ascending order until half of all eligible
non-highly compensated employees have been identified, subject to the
further requirements of
Section 5.5(b)(1)(A)(viii).
|
|
(2)
|
Top-Heavy Plan
Years
|
The
top-heavy minimum benefit requirements shall be met as provided under
Section 3.2(c)(2) concerning profit sharing and qualified nonelective
contribution allocations.
|
(3)
|
Compensation – For
purposes of the allocation of the qualified nonelective contribution,
compensation means compensation as defined in Section 1.2(a)
and (b) (subject to the limitations of Section 1.2(c)) for the
entire plan year, but limited to the employee's compensation for the
portion of the plan year in which the employee actually is a member of the
eligible class of employees as defined in
Section 2.2. However, for purposes of the top-heavy
contribution, compensation means compensation as defined in
Section 5.1(c)(2), subject to the limitations of
Section 1.2(c).
|
Section
3.4 – Employee 401(k) Elective Deferral Contributions
(a)
|
Amount of Contribution –
The employer shall contribute each plan year on behalf of each active
participant who elects salary deferral a sum equal to the amount that the
participant has elected to defer under a salary reduction arrangement or
under a cash or deferred arrangement. The contribution shall be
credited to the participant's employee 401(k) elective deferral
account.
|
A highly
compensated employee may not elect a salary reduction in excess of the
limitation established by board resolution. Such limitation shall be
communicated to the highly compensated employees a reasonable time in advance of
the date as of which it is effective. The plan administrator may
limit the amount of salary reduction or deferred compensation at any time, if he
determines that such limitation is necessary to meet the requirements for a
“qualified cash or deferred arrangement” under Code section 401(k) and
regulations issued pursuant thereto as set forth in
Section 5.5.
Effective
for plan years beginning prior to 2009, the plan administrator shall calculate
the actual deferral percentage for the highly compensated employees using the
testing method as provided under the prior statement of the plan
document.
Effective
for plan years beginning on or after January 1, 2009, the plan
administrator shall calculate the actual deferral percentage for the highly
compensated employees using the prior year testing method.
(b)
|
Salary Reduction
Election
|
|
(1)
|
Availability of Election
– An active participant may effect a salary reduction agreement with the
employer under which an employer contribution will be made to the plan on
behalf of such participant only if he elects to reduce his compensation or
to forgo an increase in his compensation. The amount of salary
deferral may range from 0% to 50% of
compensation.
|
|
(2)
|
Election Procedures – A
written notice of a participant’s salary reduction election shall be given
to the employer and to the plan administrator upon such forms as may be
provided by the plan administrator. The written notice shall be
given at least 10 days before March 31, June 30,
September 30, or December 31 on which it is to be
effective. However, in no event shall such notice be given or
be effective before the adoption of the employee 401(k) elective deferral
contribution provision under the plan. A participant electing
salary reduction will be deemed to desire to continue at the same rate,
unless he notifies the plan administrator at least 10 days before the
applicable date of his desire to change the amount of salary
reduction. The revised election shall be effective on the
applicable date. A salary reduction may be discontinued at any
time upon proper notice. A participant who has declined or
suspended salary reduction may elect salary reduction at a subsequent
election date by written notification to the plan administrator in the
manner and on the forms as provided under this paragraph. The
plan administrator and employer shall treat a salary reduction election as
having been revoked by the participant upon his termination of employment
or his ceasing to be a member of the eligible class of
participants.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
14
|
Weis
Markets, Inc. Retirement Savings Plan
A
participant who receives a distribution of elective deferrals after
December 31, 2001 on account of hardship shall be prohibited from
making elective deferrals and employee nondeductible contributions under this
and all other plans of the employer for 6 months after receipt of the
distribution. A participant who receives a distribution of elective
deferrals in calendar year 2001 on account of hardship shall be prohibited from
making elective deferrals and employee nondeductible contributions under this
and all other plans of the employer for 12 months after receipt of the
distribution as previously provided under this plan.
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(3)
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Compensation – For this
purpose, compensation means compensation as defined in Section 1.2(a)
and (b) (subject to the limitations of Section 1.2(c)), but
excluding short term disability benefits not paid through the employer's
payroll system. The participant’s salary reduction election
shall apply only to compensation that becomes currently available to the
employee after the effective date of the election. The employer
shall apply the salary reduction election to all of the participant’s
compensation (and to increases in compensation), unless the participant’s
salary reduction election specifies that the election is to be limited to
certain compensation.
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(4)
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Catch-Up Contributions –
Effective April 1, 2004, all employees who are eligible to make elective
deferrals under this plan before the close of the plan year and who have
attained age 50 or over by the end of their applicable taxable years
shall be eligible to make catch-up contributions in accordance with, and
subject to the limitations of, Section 5.5(a)(2). The
employer-imposed limitations on the maximum amount of permissible salary
deferral shall not apply.
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(c)
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Cash or Deferred
Election
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No
contribution shall be made under this plan pursuant to a cash or deferred
election. All elective deferrals shall be made under a salary
deferral election.
Section
3.5 – Employee Nondeductible Contributions
Employee
nondeductible contributions are not permitted under this plan and no amount
shall be credited to the employee nondeductible contribution
account.
Section
3.6 – Employer Matching Contributions
Employer
matching contributions shall be made under the provisions of this
Section. Such contributions shall be credited to the employer
matching contribution account or the qualified employer matching contribution
account, as applicable.
With
respect to each interim allocation date, the employer shall contribute the
amount necessary to fund the employer matching contribution allocation for the
interim allocation period based on the eligible deferrals and participant
compensation for such period.
Effective
for plan years beginning prior to 2009, the plan administrator shall calculate
the actual contribution percentage for the highly compensated employees using
the testing method as provided under the prior statement of the plan
document.
Effective
for plan years beginning on or after January 1, 2009, the plan
administrator shall calculate the actual contribution percentage for the highly
compensated employees using the prior year testing method.
(a)
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Qualified Matching
Contributions – The employer matching contribution shall not be
treated as a qualified matching contribution. A qualified
matching contribution means matching contributions that are subject to the
distribution and nonforfeitability requirements under Code
section 401(k) when made.
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(b)
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Contributions Subject to
Matching – Employer matching contributions shall be made for an
eligible participant with respect to the following
contributions:
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Copyright © 2006 by
Conrad Siegel
Actuaries
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15
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Markets, Inc. Retirement Savings Plan
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·
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Any
contributions made under a salary reduction agreement pursuant to
Section 3.4
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·
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Effective
April 1, 2004, any catch-up
contributions
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(c)
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Conditions for
Allocation – A participant shall be eligible for an allocation of
an employer matching contribution as of an allocation date, provided that
he satisfies the following
conditions:
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(1)
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He
made a contribution that is subject to matching during the current plan
year.
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AND
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(2)
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He
completed at least one hour of service during the current allocation
period.
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AND
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(3)
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Effective
for allocations made after March 31, 2004, he is not a highly compensated
employee who has held the title of chairman, vice chairman, president, or
vice president with respect to the employer as of any day in the plan year
on or before the allocation date.
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Notwithstanding
the preceding requirements, any hours of service or employment requirement shall
not apply in any plan year for which the employer elects to comply with the ACP
safe harbor in years beginning after December 31, 1998.
(d)
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(1)
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Allocation Formula – The
employer matching contribution and any applicable forfeitures shall be
equal to the employer matching percentage applied to the participant’s
contributions for each allocation period within the current plan year that
are subject to matching.
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The
employer matching percentage shall be equal to 25% of the amount contributed by
the participant; provided that a participant's contributions in excess of 4% of
his compensation shall be disregarded for purposes of allocating the employer
matching contributions for the allocation period.
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(2)
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Limitation on Total Matching
Allocation – Notwithstanding the preceding allocation formula(s),
an allocation shall not be made to an individual participant's account to
the extent that when combined with any other employer matching
contribution made to the participant's account for the plan year, it would
exceed the greatest of: (i) 5% of his compensation; (ii)
his elective deferrals for the plan year; or (iii) the product of 2
times the sum of the plan’s representative matching rate (as defined in
Section 5.5(c)(1)(A)(ix)) plus the participant’s elective deferrals
for the plan year. Such an excess allocation shall be
reallocated among the remaining eligible
participants.
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(3)
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Compensation – For
purposes of the allocation of the employer matching contribution,
compensation means compensation as defined in Section 1.2(a)
and (b) (subject to the limitations of Section 1.2(c)) for the
allocation period. Compensation includable under
Section 1.2(a) and (b) but not paid through payroll shall be
treated as being paid as of the last day of the plan year or the last day
of employment, if earlier.
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Short
term disability benefits not paid through the employer's payroll system shall
not be taken into account for this purpose.
(e)
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Forfeitures of Excess Aggregate
Contributions
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Excess
aggregate contributions that are determined under the actual contribution
percentage test and that are attributed to employer matching contributions shall
be distributed to the extent vested with a proportional amount of the nonvested
employer matching contribution being forfeited as of the last day of the plan
year in which the excess arose. Also, any forfeitures required for
compliance with Code section 401(a)(4) and Regulation
section 1.401(m)-2(b)(3)(v)(B) (because the contribution to which it
relates is treated as an excess deferral, excess contribution, or excess
aggregate contribution) shall occur as of such date. The forfeitures
shall be treated in the manner described in Section 4.2(c)(2), except that
any reallocation shall be made only to the accounts of nonhighly compensated
employees.
Section
3.7 – Rollover/Transfer Contributions
(a)
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Rollover Contributions –
An active participant may contribute to his rollover/transfer account any
amounts that he previously received either as a lump sum distribution (as
defined in Code section 402(e)(4)(D)) or within one taxable year as a
distribution from another qualified plan on account of termination of that
plan provided that:
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(1)
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He
transferred such distribution to an individual retirement account or
annuity within sixty (60) days after receipt,
or
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Copyright © 2006 by
Conrad Siegel
Actuaries
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16
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Markets, Inc. Retirement Savings Plan
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(2)
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He
transferred such distribution to this plan within sixty (60) days
after receipt.
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Before
accepting a rollover contribution, the trustee may require an employee to
furnish satisfactory evidence that the proposed transfer is in fact a “rollover
contribution” that the Code permits an employee to make to a qualified
plan. Effective for requests received on or after
January 1, 2002, the acceptable sources for a rollover contribution
shall be as set forth in Section 3.7(b). Notwithstanding the
preceding or the provisions of Section 3.7(b), this plan will not accept a
rollover from a Roth elective deferral account.
(b)
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Transfer Contributions –
With the consent of the plan administrator, an active participant may have
funds transferred directly to this plan from another qualified
plan. Consent shall not be given if the optional forms of
payment to which the funds are subject under the prior plan are not
properly disclosed by the prior plan or cannot be accommodated by this
plan and trust.
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Further,
this plan shall not accept any direct or indirect transfers (in a transfer after
December 31, 1984) from a defined benefit plan, money purchase plan
(including a target benefit plan), stock bonus or profit sharing plan that would
otherwise have provided for a life annuity form of payment to the
participant.
Effective
for requests received on or after January 1, 2002, with the consent of
the plan administrator, the participant may have the following transfers made on
his behalf directly to this plan (or may make the following rollover
contributions as permitted below):
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·
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A
direct rollover of an eligible rollover distribution from a qualified plan
described in Code section 401(a) or 403(a), excluding after-tax
employee contributions.
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·
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Transfers
from a Roth elective deferral account under a qualified Code
section 401(a) plan shall not be
permitted.
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·
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A
direct rollover of an eligible rollover distribution from an annuity
contract described in Code section 403(b), excluding after-tax
employee contributions.
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·
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Transfers
from a Roth elective deferral account under a Code section 403(b)
account shall not be permitted.
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·
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A
direct rollover or a participant contribution of an eligible rollover
distribution from an eligible plan under Code section 457(b) that is
maintained by a state, political subdivision of a state, or any agency or
instrumentality of a state or political subdivision of a
state.
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·
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Transfers
from an individual retirement account or annuity described in Code
section 408(a) or 408(b) (including an account more specifically
described under Code section 408(k) or (p)) shall not be
permitted.
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(c)
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Contributions Before Plan Entry
Date – An employee, (who is in the eligible class of employees)
prior to satisfying the plan’s eligibility conditions, may make a rollover
or transfer contribution to the plan to the same extent and in the same
manner as a participant. If an employee makes a rollover or
transfer contribution to the plan before satisfying the plan's eligibility
conditions, the plan administrator and trustee will treat the employee as
a participant for all purposes of the plan, except the employee is not a
participant for purposes of sharing in contributions or forfeitures under
the plan until he actually becomes a participant in the
plan. If the employee has a separation from service prior to
becoming a participant, the trustee will distribute his rollover/transfer
account to him.
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(d)
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Distribution –
Withdrawals may be made from a rollover/transfer account under the terms
and conditions set forth in
Section 4.4.
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Section
3.8 – Allocation of Investment Results
(a)
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General Allocation
Procedures
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Investment
income and market value appreciation or depreciation shall be allocated to each
account of each participant who has accrued benefits in proportion to the
respective account balances on each accounting date. For this
purpose, each account balance shall be equal to the average balance for the
period commencing on the day following the prior accounting date and ending on
the current accounting date.
Copyright © 2006 by
Conrad Siegel
Actuaries
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17
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Markets, Inc. Retirement Savings Plan
(b)
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Investment
Elections
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A
participant may elect to have all of his accounts invested in such investment
fund or combination of investment funds as may be established by the trustee and
made available for the benefit of participants; provided, however, that in no
event may the participant direct that any portion of his account(s) be invested
in collectibles (as defined in Code section 408(m)). A
participant's investment election shall not apply to any portion of any account
that may be invested in a participant loan sub-account established under
Section 4.4. The investment results shall be allocated to the
participant's account(s) based upon earnings and losses on the participant's
share in such investment fund or funds.
The terms
and conditions for investment direction shall be established by the plan
administrator.
An
election may be revoked only by another election and will remain in effect until
such revocation. If no initial election is timely received by the
plan administrator, the plan administrator shall invest the account in a fund
designated for such purpose.
ARTICLE
IV – PAYMENT OF PARTICIPANT ACCOUNTS
Section
4.1 – Vesting Service Rules
(a)
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Vesting Year of Service
means a vesting computation period during which the employee completes at
least 1,000 hours of service with the employer. All of an
employee's years of service with the employer shall be counted to
determine the nonforfeitable percentage in the employee's account
balance(s) derived from employer contributions,
except:
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(1)
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Years
of service disregarded under the break in service rules in
Section 4.1(d) below. (Post-ERISA break in service
rules)
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(2)
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Years
of service before the effective date of ERISA if such service would have
been disregarded under the break in service rules of the prior plan in
effect from time to time before such date. For this purpose,
break in service rules are rules that result in the loss of prior vesting
or benefit accruals, or that deny an employee eligibility to participate,
by reason of separation or failure to complete a required period of
service within a specified period of time. (Pre-ERISA break in
service rules)
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(b)
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One Year Break in
Service means for the purposes of this Article IV a vesting
computation period during which the employee or former employee does not
complete more than 500 hours of service with the
employer.
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(c)
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Vesting Computation
Period means the 12-consecutive-month period coinciding with the
plan year.
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(d)
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Break in Service
Rules
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(1)
|
Vested Participant – A
former participant who had a nonforfeitable right to all or a portion of
his account balance(s) derived from employer contributions or who
(effective for plan years beginning on or after January 1, 2006)
had made an employee elective deferral contribution at the time of his
termination from service shall retain credit for all vesting years of
service prior to a break in service as that term is defined in
Section 4.1(b).
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|
(2)
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Nonvested Participant or
Employee – In the case of a former participant or employee who did
not have any nonforfeitable right to his account balance(s) derived from
employer contributions and who (effective for plan years beginning on or
after January 1, 2006) had made no employee elective deferral
contribution at the time of his termination from service, years of service
before a period of consecutive one-year breaks in service shall not be
taken into account in computing service if the number of consecutive
one-year breaks in service in such period equals or exceeds the greater
of 5 or the aggregate number of years of service before such breaks in service. Such aggregate number of years of service shall not
include any years of service disregarded under the preceding sentence by
reason of prior breaks in service.
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|
(3)
|
Vesting for Pre-Break and
Post-Break Accounts – In the case of a participant or employee who
has five or more consecutive one-year breaks in service, all years of
service after such breaks in service shall be disregarded for the purpose
of vesting the employer-derived account balance(s) that accrued before
such breaks in service. Whether or not such pre-break service
counts in vesting the post-break employer-derived account balance(s) shall
be determined according to the rules set forth in Section 4.1(d)(1)
and (2) above. Separate accounts shall be maintained for each
of the participant’s pre-break and post-break employer-derived account
balance(s). All accounts shall share in the investment earnings
and losses of the fund.
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Copyright © 2006 by
Conrad Siegel
Actuaries
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18
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Markets, Inc. Retirement Savings Plan
Section
4.2 – Vesting of Participant Accounts
(a)
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Determination of
Vesting
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(1)
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Normal Retirement – An
employee's right to his account balance(s) shall be 100% vested and
nonforfeitable upon the attainment of age 65, the normal retirement
age. The vesting of an inactive participant who terminates
employment prior to normal retirement age shall remain subject to the
provisions of the vesting schedule following attainment of such specified
age. Distributions shall be administered in accordance with
termination from employment provisions of
Section 4.3(a)(3).
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|
(2)
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Late Retirement – If a
participant remains employed after his normal retirement age, his account
balance(s) shall remain 100% vested and nonforfeitable. Such
participant shall continue to receive allocations to his account as he did
before his normal retirement age.
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(3)
|
Early Retirement – In
the case of a participant who has attained age 60 and
completed 7 years of service before his normal retirement age, the
participant's right to his account balance(s) shall be 100% vested and
nonforfeitable. Such participant may retire before his normal
retirement age without the consent of the employer and receive payment of
benefits from the plan. If a participant separates from service
before satisfying the age requirement for early retirement, but has
satisfied the service requirement, the participant shall be entitled to
elect an early retirement benefit upon satisfaction of such age
requirement.
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(4)
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Disability – If a
participant separates from service due to disability, such participant’s
right to his account balance(s) as of his date of disability shall be 100%
vested and nonforfeitable. Disability means the participant has
been determined by the Social Security Administration to be eligible for
either full or partial Social Security disability
benefits.
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(5)
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(A)
|
Death – In the event of
the death of a participant who has an accrued benefit under the plan,
(whether or not he is an active participant), 100% of the participant’s
account balance(s) as of the date of death shall be paid to his surviving
spouse; except that, if there is no surviving spouse, or if the surviving
spouse has already consented in a manner that is (or conforms to) a
qualified election under the joint and survivor annuity provisions of Code
section 417(a) and regulations issued pursuant thereto and as set
forth in Section 5.2, then such balance(s) shall be paid to the
participant's designated beneficiary. The payment options
available to the beneficiary shall be those payment options available to
the participant under
Section 4.3(b).
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|
(B)
|
Beneficiary Designation
– Subject to the spousal consent requirements of Section 5.2, the
participant shall have the right to designate his beneficiaries, including
a contingent death beneficiary, and shall have the right at any time prior
to his death to change such beneficiaries. The designation shall be
effective only if made in writing on a form signed by the participant and
supplied by and filed with the plan administrator prior to his death. If
the participant fails to designate a beneficiary, or if the designated
person or persons predecease the participant, "beneficiary" shall mean:
(a) the spouse, (b) if no surviving spouse, then to the surviving children
in equal shares, (c) if no surviving children, then to the surviving
parents in equal shares, (d) if no surviving parents, then to the
surviving brothers and sisters in equal shares, (e) if no surviving
brothers and sisters, then (f) to the participant’s estate if an estate is
opened within 2 years of the participant’s death; and otherwise to a
charity selected in the sole discretion of the plan
administrator.
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If a
designated beneficiary dies after the participant has died but before the plan
has commenced or made distribution to the designated beneficiary, the plan shall
be administered as set forth in this paragraph. The death benefit will be paid
to the beneficiary’s designated beneficiary, if any designated prior to such
beneficiary’s death in connection with the beneficiary’s election of a form of
payment of the participant’s death benefit to which he is entitled; and if no
such designation is on file with the plan administrator, then to the
beneficiary's estate in a single lump sum payment if an estate is opened within
2 years of the participant’s death; and otherwise to a charity selected in the
sole discretion of the plan administrator. If the deceased designated
beneficiary was not the participant's surviving spouse, distribution under this
paragraph will be completed by December 31 of the fifth year following the
participant's date of death. If the deceased designated beneficiary
was the participant's surviving spouse, distribution under this paragraph will
be completed by December 31 of the fifth year following the beneficiary's date
of death.
Copyright © 2006 by
Conrad Siegel
Actuaries
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19
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Markets, Inc. Retirement Savings Plan
For
purposes of this Section 4.2(a)(5), if a spouse or beneficiary of the
participant dies simultaneously with the participant, the participant shall be
deemed to be the survivor and to have died subsequent to such spouse or
beneficiary. Likewise, if a beneficiary named by a designated
beneficiary dies simultaneously with a designated beneficiary, the designated
beneficiary shall be deemed to be the survivor and to have died subsequent to
the beneficiary named by the designated beneficiary.
If a
participant completes or has completed a beneficiary designation form in which
the participant designates his spouse as the beneficiary and the participant and
such spouse are legally divorced subsequent to the date of such designation;
then, the designation shall be administered as if such spouse had predeceased
the participant unless the participant, subsequent to the legal divorce,
reaffirms the designation by completing a new beneficiary designation
form.
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(6)
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Termination From Service
– If a participant separates from the service of the employer other than
by retirement, disability, or death, his vested interest in his accounts
shall be equal to the account balance multiplied by the vesting percentage
determined below:
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|
(A)
|
Profit Sharing Account –
The vesting percentage applicable to the participant’s profit sharing
account shall be determined based on his vesting years of service as
follows:
|
Years
of Service
|
Vesting Percentage
|
|||
0–1
Year
|
0 | % | ||
2
|
20 | % | ||
3
|
40 | % | ||
4
|
60 | % | ||
5
|
80 | % | ||
6
or More Years
|
100 | % |
Transition Rule –
Notwithstanding the above vesting schedule, the vesting provisions of the plan
before January 1, 2007, shall continue to apply to participants who do
not have an hour of service on or after such date.
|
(B)
|
Employer Matching Contribution
Account – The vesting percentage applicable to the participant's
employer matching contribution account shall be determined as
follows:
|
Years
of Service
|
Vesting Percentage
|
|||
0–1
Year
|
0 | % | ||
2
|
20 | % | ||
3
|
40 | % | ||
4
|
60 | % | ||
5
|
80 | % | ||
6
or More Years
|
100 | % |
Transition Rule –
Notwithstanding the above vesting schedule, the vesting provisions of the plan
before January 1, 2002, shall continue to apply to participants who do
not have an hour of service on or after such date.
|
(C)
|
Other Accounts – The
participant shall always be 100% vested in his following
accounts: employee 401(k) elective deferral account; employee
nondeductible contribution account; qualified employer matching
contribution account; qualified nonelective contribution account;
rollover/transfer account. The accrued benefit in such accounts
shall be nonforfeitable.
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(b)
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Forfeitures
|
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(1)
|
Time of Forfeiture – If
a participant terminates employment before his account balances derived
from employer contributions are fully vested, the nonvested portion of his
accounts shall be forfeited on the earlier
of:
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|
(A)
|
The
last day of the vesting computation period in which the participant first
incurs five consecutive one-year breaks in service,
or
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Copyright © 2006 by
Conrad Siegel
Actuaries
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20
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Weis
Markets, Inc. Retirement Savings Plan
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(B)
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The
date the participant receives his entire vested accrued
benefit.
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(2)
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Cashout Distributions and
Restoration
|
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(A)
|
Cashout Distribution –
If an employee terminates service and the value of his vested account
balances derived from employer and employee contributions are not greater
than $5,000, the employee shall receive a distribution of the value of the
entire vested portion of such account balances and the nonvested portion
will be treated as a forfeiture. If an employee would have
received a distribution under the preceding sentence but for the fact that
the employee's vested account balance exceeded $5,000 when the employee
terminated service and if at a later time such account balance is reduced
such that it is not greater than $5,000, the employee will receive a
distribution of such account balance and the nonvested portion will be
treated as a forfeiture. For purposes of this section, if the
value of an employee's vested account balances is zero, he shall be deemed
to have received a distribution of such vested account
balances. Effective for distributions made on or after
March 22, 1999, for the purpose of determining the value of a
participant's vested account balance, prior distributions shall be
disregarded if distributions have not commenced under an optional form of
payment described in
Section 4.3.
|
If an
employee terminates service and elects, in accordance with the requirements of
Section 4.3, to receive the value of his vested account balances, the
nonvested portion shall be treated as a forfeiture as of the date of
distribution. If the employee elects to have distributed less than
the entire vested portion of the account balances derived from employer
contributions, the part of the nonvested portion that will be treated as a
forfeiture is the total nonvested portion multiplied by a fraction, the
numerator of which is the amount of the distribution attributable to employer
contributions and the denominator of which is the total value of the vested
employer derived account balances.
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(B)
|
Restoration of Accounts
– If an employee receives a cashout distribution pursuant to this section
and resumes employment covered under this plan before he incurs five
consecutive one-year breaks in service, his employer-derived account
balances shall each be restored to the amount on the date of distribution,
if he repays to the plan the full amount of the distribution attributable
to employer contributions before the earlier of five years after the first
date on which he is subsequently re-employed by the employer, or the date
he incurs five consecutive one-year breaks in service following the date
of the distribution. If an employee is deemed to receive a
distribution pursuant to this Section 4.2(b)(2), and he resumes
employment covered under this plan before he incurs five consecutive
one-year breaks in service, upon the re-employment of such employee his
employer-derived account balances will be restored to the amount on the
date of such deemed distribution.
|
Any
amount required to restore such forfeitures shall be deducted from forfeitures
(including forfeitures of excess aggregate contributions) occurring in the plan
year of restoration. If forfeitures are insufficient for the
restoration, the employer may make a contribution to the plan for such plan year
to satisfy the restoration. However, by the end of the plan year
following the plan year of restoration, sufficient forfeitures or employer
contributions shall be credited to the account to satisfy the
restoration.
(c)
|
Disposition of
Forfeitures
|
|
(1)
|
Profit Sharing Account –
Forfeitures of profit sharing accounts shall be reallocated among the
eligible active participants at the end of the plan year in which such
forfeitures occur in accordance with the allocation procedures set forth
in Section 3.2.
|
|
(2)
|
Employer Matching Contribution
Account – Forfeitures of employer matching contribution accounts
first shall be used to reduce administrative expenses; any remaining
forfeitures shall be used to reduce the employer matching contribution for
the plan year in which such forfeitures
occur.
|
(d)
|
Withdrawal of Employee
Nondeductible Contributions – No forfeitures shall occur solely as
a result of an employee's withdrawal of employee nondeductible
contributions.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
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21
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Markets, Inc. Retirement Savings Plan
(e)
|
Unclaimed
Benefits
|
|
(1)
|
Forfeiture – The plan
does not require the trustee or the plan administrator to search for, or
to ascertain the whereabouts of, any participant or
beneficiary. At the time the participant's or beneficiary's
benefit becomes distributable under the plan, the plan administrator, by
certified or registered mail addressed to his last known address of
record, shall notify any participant or beneficiary that he is entitled to
a distribution under this plan. If the participant or
beneficiary fails to claim his distributive share or make his whereabouts
known in writing to the plan administrator within twelve months from the
date of mailing of the notice, the plan administrator shall treat the
participant's or beneficiary's unclaimed payable accrued benefit as
forfeited and shall reallocate such forfeiture in accordance with
Section 4.2(c). A forfeiture under this paragraph shall
occur at the end of the notice period or, if later, the earliest date
applicable Treasury regulations would permit the
forfeiture. These forfeiture provisions apply solely to the
participant’s or beneficiary’s accrued benefit derived from employer
contributions.
|
|
(2)
|
Restoration – If a
participant or beneficiary who has incurred a forfeiture of his accrued
benefit under the provisions of this Subsection makes a claim, at any
time, for his forfeited accrued benefit, the plan administrator shall
restore the participant's or beneficiary's forfeited accrued benefit to
the same dollar amount as the dollar amount of the accrued benefit
forfeited, unadjusted for any gains or losses occurring after the date of
the forfeiture. The plan administrator shall make the
restoration during the plan year in which the participant or beneficiary
makes the claim from forfeitures occurring in that plan
year. If forfeitures are insufficient for the restoration, the
employer shall make a contribution to the plan to satisfy the
restoration. The plan administrator shall direct the trustee to
distribute the participant's or beneficiary's restored accrued benefit to
him not later than 60 days after the close of the plan year in which
the plan administrator restores the forfeited accrued
benefit.
|
Section
4.3 – Payment of Participant Accounts
(a)
|
Time of
Payment
|
|
(1)
|
Commencement of Benefits
– Unless the participant elects otherwise, distribution of benefits shall
begin no later than the 60th day after the latest of the close of the
plan year in which:
|
|
(A)
|
The
participant attains age 65 (or normal retirement age, if
earlier);
|
|
(B)
|
Occurs
the 10th anniversary of the year in which the participant commenced
participation in the plan; or
|
|
(C)
|
The
participant terminates service with the employer (i.e. late
retirement).
|
|
(2)
|
Payment Upon Retirement,
Disability, or Death – Subject to the provisions set forth in
Section 4.3(a)(1), in the Joint and Survivor Requirements of
Section 5.2, and in the Distribution Requirements of
Section 5.3, if the participant terminates employment due to
retirement, disability, or death, his account(s) shall be paid as soon as
administratively possible after the occurrence of the event creating the
right to a distribution.
|
|
(3)
|
Payment Upon Other Termination
of Employment – Subject to the provisions set forth in
Section 4.3(a)(1) and in the Distribution Requirements of
Section 5.3, if the participant terminates employment other than by
retirement, disability, or death, his account(s) shall be paid as soon as
administratively possible after the date of severance of
employment.
|
Notwithstanding
the preceding, an alternate payee may elect to have paid the amount determined
under the qualified domestic relations order as soon as administratively
possible following the date permitted under Section 4.5.
|
(4)
|
Notwithstanding
the foregoing, the failure of a participant (and spouse where the spouse's
consent is required) to consent to a distribution while a benefit is
immediately distributable, within the meaning of Section 5.2(a),
shall be deemed to be an election to defer commencement of payment of any
benefit sufficient to satisfy this
section.
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(b)
|
Form of Payment – A
participant or beneficiary may elect to receive distribution of his
account(s) as a lump sum benefit payment. The participant or
beneficiary shall file a written request for benefits with the plan
administrator before payment will be made. The lump sum benefit
payment shall be made in cash from the fund. However, if the
vested accrued benefit is no more than $5,000, benefits shall
automatically be paid in a lump sum in accordance with
Section 4.3(d)(5).
|
Effective
solely for distributions made before October 1, 2009, a participant
was permitted to elect installment payments over a period of years that meets
the Distribution Requirements of Section 5.3. Installment
payments may be made in cash from the fund or by distribution of an annuity term
certain contract.
Copyright © 2006 by
Conrad Siegel
Actuaries
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Markets, Inc. Retirement Savings Plan
If a
distribution is required under the Distribution Requirements of
Section 5.3, the participant fails to elect payment, and the vested balance
of the account(s) exceeds $5,000, the trustee shall pay the benefit in
installment payments that meet the requirements of Section 5.3 over the
joint life and last survivor expectancy of the participant and his designated
beneficiary. If the vested balance of the account(s) does not exceed
$5,000, the trustee shall distribute the entire account balance in a lump
sum.
(c)
|
General Payment
Provisions
|
|
(1)
|
All
distributions due to be made under this plan shall be made on the basis of
the amount to the credit of the participant as of the accounting date
coincident with or immediately preceding the occurrence of the event
calling for a distribution.
|
Such
amount shall be adjusted with respect to the investment results attributable
thereto that accrue during the period following such accounting date until the
date of the actual distribution.
If a
distributable event occurs after an allocation date and before allocations have
been made to the account of the participant, the distribution shall also include
the amounts allocable to the account as of such allocation date.
|
(2)
|
If
any person entitled to receive benefits hereunder is physically or
mentally incapable of receiving or acknowledging receipt thereof, and if a
legal guardian or power of attorney has been appointed for him, the plan
administrator may direct the benefit payment to be made to such legal
representative. The plan administrator may cause benefits to be
paid to any other individual recognized by the state law under which the
plan trust has been established.
|
In the
event a distribution is to be made to a minor beneficiary, then the plan
administrator may direct that such distribution be paid to the legal guardian,
or if none, to a parent of such beneficiary or a responsible adult with whom the
beneficiary maintains his residence, or to the custodian for such beneficiary
under the Uniform Gift to Minors Act or the Gift to Minors Act, if such is
permitted by the laws of the state in which said beneficiary
resides. Such a payment to the legal guardian, custodian or parent of
a minor beneficiary shall fully discharge the trustee, employer, plan
administrator, and plan from further liability on account thereof.
|
(3)
|
Each
optional form of benefit provided under the plan shall be made available
to all participants on a nondiscriminatory basis. The plan may
not retroactively reduce or eliminate optional forms of benefits and any
other Code section 411(d)(6) protected benefits, except as provided
in Regulation section 1.411(d)-4, Q&A-2(b) and in other relief
granted statutorily or by the Commissioner of Internal
Revenue.
|
|
(4)
|
The
participant's election of a form of benefit payment shall be irrevocable
as of the annuity starting date, subject to the notice requirements
contained in Section 4.3(e). For purposes of accounting,
an installment distribution shall be debited from each of a participant's
accounts on a pro rata basis.
|
(d)
|
Eligible Rollover
Distributions
|
Effective
for distributions made on or after January 1, 1993, notwithstanding
the optional forms of payment listed in Section 4.3(b), a distributee may
elect, at the time and in the manner prescribed by the plan administrator, to
have any portion of an eligible rollover distribution paid directly to an
eligible retirement plan specified by the distributee in a direct
rollover.
|
(1)
|
Eligible Rollover
Distribution – An eligible rollover distribution is any
distribution of all or any portion of the balance to the credit of the
distributee, except that an eligible rollover distribution does not
include: any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually)
made for the life (or life expectancy) of the distributee or the joint
lives (or joint life expectancies) of the distributee and the
distributee's designated beneficiary, or for a specified period of ten
years or more; any distribution to the extent such distribution is
required under Code section 401(a)(9), the portion of any
distribution that is not includable in gross income (determined without
regard to the exclusion for net unrealized appreciation with respect to
employer securities); any hardship withdrawal made on or after
January 1, 1999 from a participant's employee 401(k) elective
deferral account before he has attained age 59½; any hardship
withdrawal made on or after January 1, 2002 from any account;
and any other distribution(s) that is reasonably expected to total less
than $200 during a year.
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Copyright © 2006 by
Conrad Siegel
Actuaries
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23
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Markets, Inc. Retirement Savings Plan
Effective
for distributions made on or after January 1, 2002, a portion of a
distribution shall not fail to be an eligible rollover distribution merely
because the portion consists of after-tax employee contributions that are not
includable in gross income. However, such portion may be transferred
only to an individual retirement account or annuity described in Code
section 408(a) or (b), or to a qualified defined contribution plan
described in Code section 401(a) or 403(a) that agrees to separately
account for amounts so transferred, including separately accounting for the
portion of such distribution that is includable in gross income and the portion
of such distribution that is not so includable.
|
(2)
|
Eligible Retirement Plan
– An eligible retirement plan is an individual retirement account
described in Code section 408(a), an individual retirement annuity
described in Code section 408(b), an annuity plan described in Code
section 403(a), or a qualified plan described in Code
section 401(a), that accepts the distributee's eligible rollover
distribution. Effective for distributions made on or after
January 1, 2002, an eligible retirement plan shall also mean an
annuity contract described in Code section 403(b) or an eligible plan
under Code section 457(b) that is maintained by a state, political
subdivision of a state, or any agency or instrumentality of a state or
political subdivision of a state and that agrees to separately account for
amounts transferred into such plan from this plan. The
definition of eligible retirement plan shall also apply in the case of a
distribution to a surviving spouse, or to a spouse or former spouse who is
the alternate payee under a qualified domestic relations order, as defined
in Code section 414(p). However, effective for
distributions made on or after January 1, 1993 and before
January 1, 2002, in the case of an eligible rollover
distribution to the surviving spouse, an eligible retirement plan is
limited to an individual retirement account or individual retirement
annuity.
|
If any
portion of an eligible rollover distribution is attributable to payments or
distributions from a designated Roth account, an eligible retirement plan with
respect to such portion shall include only a designated Roth account in a
qualified defined contribution plan described in Code section 401(a) or a
Roth IRA as defined in Code section 402A(c)(3)(A).
|
(3)
|
Distributee – A
distributee includes an employee or former employee. In
addition, the employee's or former employee's surviving spouse and the
employee's or former employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as defined in
Code section 414(p), are distributees with regard to the interest of
the spouse or former spouse.
|
|
(4)
|
Direct Rollover – A
direct rollover is a payment by the plan to the eligible retirement plan
specified by the distributee.
|
|
(5)
|
Automatic Rollovers – In
the event of a mandatory distribution greater than $1,000 in
accordance with the provisions of Section 4.2(b)(2)(A), if the
participant does not elect to have such distribution paid directly to an
eligible retirement plan specified by the participant in a direct rollover
or to receive the distribution directly in accordance with
Section 4.3(e), then the plan administrator shall pay the
distribution in a direct rollover to an individual retirement plan
designated by the plan administrator. For purposes of
determining whether a mandatory distribution is greater than $1,000,
the portion of the participant’s distribution attributable to any rollover
contribution shall be included.
|
(e)
|
Payment Election
Procedures
|
As
described in Section 5.2(c), an account balance in excess of $5,000 shall
not be immediately distributed without the consent of the
participant. The participant shall receive the notice required under
Regulation section 1.411(a)-11(c) no less than 30 days and no more
than 90 days before the annuity starting date with respect to the
distribution. Effective for distributions made on or after
January 1, 1993, for any distribution in excess of $200, the plan
administrator shall give the participant notice of his eligible rollover
distribution rights. The participant shall receive such notice in the
same time period as the 411 notice is required to be
provided. Effective for distributions made on or after
January 1, 1994, if a distribution is one to which Code
sections 401(a)(11) and 417 do not apply, such distribution may
commence less than 30 days after the 411 notice is given, provided
that:
|
(1)
|
The
plan administrator clearly informs the participant that the participant
has a right to a period of at least 30 days after receiving the
notice to consider the decision of whether or not to elect a distribution
(and, if applicable, a particular distribution option),
and
|
|
(2)
|
The
participant, after receiving the notice, affirmatively elects a
distribution.
|
The
provisions of this paragraph shall be effective for distributions made on or
after March 28, 2005. In the event of a mandatory
distribution greater than $1,000 in accordance with the provisions of
Section 4.2(b)(2)(A), if the participant does not elect to have such
distribution paid directly to an eligible retirement plan specified by the
participant in a direct rollover or to receive the distribution directly in
accordance with Section 4.3(d), then the plan administrator will pay the
distribution in a direct rollover to an individual retirement plan designated by
the plan administrator.
Copyright © 2006 by
Conrad Siegel
Actuaries
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Markets, Inc. Retirement Savings Plan
Section
4.4 – In-Service Payments
(a)
|
Withdrawals – An
employee may withdraw amounts from his account(s) before his separation
from service only under the circumstances and only to the extent provided
below.
|
The plan
administrator shall approve requests on a nondiscriminatory basis. No
forfeitures shall occur solely as a result of a participant's withdrawal of
employee contributions. The in-service receipt of benefits by an
employee shall not affect his participation in the plan, and such participant
shall continue to receive allocations to his account(s).
Distribution After Attainment of
Normal Retirement Age – An employee may elect to receive payment of
benefits from his account(s) at any time after his normal retirement age by
filing a written request with the plan administrator. For purposes of
accounting, a partial distribution shall be debited from each of a participant's
accounts on a pro rata basis.
Withdrawals
from Employer Accounts
|
(A)
|
Availability of Withdrawal
Privilege – Subject to the limitations and conditions set forth
herein, an employee who has completed at least 5 years of participation in
the plan and has attained age 55 may request a transfer in one lump sum
from his vested profit sharing account to an individual retirement
account.
|
|
(B)
|
Amount of Withdrawal –
The amount that an eligible participant may withdraw from an account shall
not exceed the vested portion of such
account.
|
|
(C)
|
Request for Withdrawal –
The participant's request to withdraw shall be made in writing to the plan
administrator. The plan administrator shall approve requests on
a nondiscriminatory basis.
|
Hardship
Withdrawals from Employee 401(k) Elective Deferral Account
|
(A)
|
Availability of Withdrawal
Privilege – An employee who has a financial hardship may request a
lump sum withdrawal from his employee 401(k) elective deferral account,
subject to the limitations and conditions set forth
herein.
|
|
(B)
|
Amount of Withdrawal –
The amount that an eligible participant may withdraw from his account
shall not exceed the cumulative amount of his 401(k) salary deferral
contributions. Earnings thereon may not be
withdrawn.
|
|
(C)
|
Request for Withdrawal –
The participant's request to withdraw must be made in writing to the plan
administrator and shall be subject to his consent. The basis
for the plan administrator's consenting to or refusing to consent to the
participant’s request shall be demonstrated financial hardship of the
participant as described in Hardship
Withdrawals.
|
Hardship
Withdrawals
For the
purpose of this Section 4.4, a distribution will be made on account of
hardship if the distribution is necessary in light of the immediate and heavy
financial need of the employee. A distribution based upon financial
hardship cannot exceed the amount required to meet the immediate financial need
created by the hardship and not reasonably available from other resources of the
participant. The determination of the existence of financial hardship
and the amount required to be distributed to meet the need created by the
hardship must be made in accordance with uniform and non-discriminatory
standards established by the plan administrator under these plan
provisions.
An
immediate and heavy financial need shall be deemed to exist if the distribution
is requested for one of the following reasons: (1) expenses
incurred or necessary for medical care described in Code section 213(d) of
the employee, the employee's spouse, children, or
dependents; (2) the purchase (excluding mortgage payments) of a
principal residence for the employee; (3) payment of tuition and related
educational fees for the next twelve months of post-secondary education for the
employee, the employee's spouse, children or dependents; (4) payments
necessary to prevent the eviction of the employee from, or a foreclosure on the
mortgage of, the employee's principal residence; (5) payments for funeral
or burial expenses for the employee's deceased parent, spouse, child or
dependent; or (6) expenses incurred to repair damage to the employee's
principal residence that would qualify for a casualty loss deduction under Code
section 165 (determined without regard to whether the loss exceeds 10% of
adjusted gross income). The latter two reasons (funeral expenses and
home repair) shall only apply to plan years beginning after
December 31, 2005.
Copyright © 2006 by
Conrad Siegel
Actuaries
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25
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Markets, Inc. Retirement Savings Plan
A
distribution will be considered as necessary to satisfy an immediate and heavy
financial need of the employee only if:
|
1.
|
The
employee has obtained all distributions, other than hardship
distributions, and all nontaxable loans under all plans maintained by the
employer;
|
|
2.
|
All
plans maintained by the employer provide that the employee's elective
deferrals (and employee nondeductible contributions) will be suspended for
6 months (12 months, for hardship distributions
before 2002) after the receipt of the hardship distribution;
and
|
|
3.
|
The
distribution is not in excess of the amount of the immediate and heavy
financial need (including amounts necessary to pay any federal, state or
local income taxes or penalties reasonably anticipated to result from the
distribution).
|
In
addition, for hardship distributions before 2002, all plans maintained by
the employer were required to provide that the employee may not make elective
deferrals for the employee's taxable year immediately following the taxable year
of the hardship distribution in excess of the applicable limit under Code
section 402(g) for such taxable year less the amount of such employee's
elective deferrals for the taxable year of the hardship
distribution.
Determination
of Vested Account Balance
If a
withdrawal is made at a time when a participant has a nonforfeitable right to
less than the entire account balance derived from employer contributions and the
participant may increase his nonforfeitable percentage in his
account:
|
(A)
|
A
separate account will be established with respect to each of the
participant's accounts that is subject to a vesting schedule that shall be
credited with the participant's interest in such account as of the time of
the distribution, and
|
|
(B)
|
At
any relevant time the participant's nonforfeitable portion of each such
separate account will be equal to an amount (“X”) determined by the
formula:
|
X = P(AB
+ (R x D)) – (R x D)
For
purposes of applying the formula: P is the nonforfeitable percentage at the
relevant time, AB is the account balance at the relevant time, D is
the amount of the distribution from the relevant account, and R is the
ratio of the account balance at the relevant time to the account balance after
distribution.
(b)
|
Participant
Loans
|
No
participant loans shall be permitted under this plan.
Section
4.5 – Distributions Under Domestic Relations Orders
Nothing
contained in this plan prevents the trustee, in accordance with the direction of
the plan administrator, from complying with the provisions of a qualified
domestic relations order (as defined in Code section 414(p)).
A
distribution will not be made to an alternate payee until the participant
attains (or would have attained) his earliest retirement age. For
this purpose, earliest retirement age means the earlier of: (1) the
date on which the participant is entitled to a distribution under this plan; or
(2) the later of the date the participant attains age 50 or the earliest
date on which the participant could begin receiving benefits under this plan if
the participant separated from service.
Nothing
in this Section gives a participant a right to receive distribution at a time
otherwise not permitted under the plan nor does it permit the alternate payee to
receive a form of payment not otherwise permitted under the plan.
The plan
administrator shall establish reasonable procedures to determine the qualified
status of a domestic relations order. Upon receiving a domestic
relations order, the plan administrator promptly will notify the participant and
any alternate payee named in the order, in writing, of the receipt of the order
and the plan's procedures for determining the qualified status of the
order. Within a reasonable period of time after receiving the
domestic relations order, the plan administrator shall determine the qualified
status of the order and shall notify the participant and each alternate payee,
in writing, of its determination. The plan administrator shall
provide notice under this paragraph by mailing to the individual's address
specified in the domestic relations order, or in a manner consistent with
Department of Labor regulations.
Copyright © 2006 by
Conrad Siegel
Actuaries
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26
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Markets, Inc. Retirement Savings Plan
If any
portion of the participant's nonforfeitable accrued benefit is payable during
the period the plan administrator is making its determination of the qualified
status of the domestic relations order, the plan administrator shall make a
separate accounting of the amounts payable. If the plan administrator
determines the order is a qualified domestic relations order within
18 months of the date amounts first are payable following receipt of the
order, it shall direct the trustee to distribute the payable amounts in
accordance with the order. If the plan administrator does not make
its determination of the qualified status of the order within the 18-month
determination period, it shall direct the trustee to distribute the payable
amounts in the manner the plan would distribute if the order did not exist and
shall apply the order prospectively if it later determines the order is a
qualified domestic relations order.
ARTICLE
V – ADDITIONAL QUALIFICATION RULES
Section
5.1 – Limitations on Allocations Under Code Section 415
(a)
|
Single Plan
Limitations
|
(1)
|
If
the participant does not participate in, and has never participated in
another qualified plan maintained by the employer, or a welfare benefit
fund (as defined in Code section 419(e)) maintained by the employer,
or an individual medical account (as defined in Code
section 415(l)(2)) maintained by the employer, or a simplified
employee pension (as defined in Code section 408(k)) maintained by
the employer, that provides an annual addition as defined in
Section 5.1(c)(1), the amount of annual additions that may be
credited to the participant's account for any limitation year will not
exceed the lesser of the maximum permissible amount or any other
limitation contained in this plan. If the employer contribution
that would otherwise be contributed or allocated to the participant's
account would cause the annual additions for the limitation year to exceed
the maximum permissible amount, the amount contributed or allocated will
be reduced so that the annual additions for the limitation year will equal
the maximum permissible
amount.
|
|
(2)
|
Prior
to determining the participant's actual compensation for the limitation
year, the employer may determine the maximum permissible amount for a
participant on the basis of a reasonable estimation of the participant's
compensation for the limitation year, uniformly determined for all
participants similarly situated.
|
|
(3)
|
As
soon as is administratively feasible after the end of the limitation year,
the maximum permissible amount for the limitation year will be determined
on the basis of the participant's actual compensation for the limitation
year.
|
|
(4)
|
If,
pursuant to Section 5.1(a)(3) or as a result of either the allocation
of forfeitures or a reasonable error in determining the amount of elective
deferrals that may be made with respect to a participant, there is an
excess amount, the excess will be disposed of as
follows:
|
|
(A)
|
Any
employee nondeductible contributions (and any gain attributable thereto),
to the extent they would reduce the excess amount, will be returned to the
participant. Effective for plan years beginning on or after
January 1, 2006, the attributable gain allocable to the excess
amount is the sum of: (i) the income allocable to the
participant's employee nondeductible contributions for the taxable year
multiplied by a fraction, the numerator of which is such participant's
excess amount for the year and the denominator is the participant's
account balance attributable to employee nondeductible contributions
without regard to any income or loss occurring during such taxable year;
and (ii) to the extent the excess contributions are or will be
credited with gain or loss as of an accounting date within the gap period
(i.e., the period after the close of the plan year and prior to the
distribution),10% of the amount determined under (i) multiplied by
the number of whole calendar months between the end of the participant's
taxable year and the date of distribution, taking into account the month
of distribution if distribution occurs after the 15th of such
month.
|
|
(B)
|
If
after the application of Subparagraph (A) an excess amount still
exists, any elective deferrals (and any gain attributable thereto
determined in the same manner as for Section 5.1(a)(4)(A)), to the
extent they would reduce the excess amount, will be distributed to the
participant with any Roth elective deferrals being distributed prior to
any other elective deferrals.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
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27
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Markets, Inc. Retirement Savings Plan
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(C)
|
If
after the application of Subparagraph (B) an excess amount still
exists, the excess amount shall be allocated and reallocated to the profit
sharing account or qualified nonelective contribution account of the other
participants in the plan to the extent permissible under the limitations
of this Section 5.1.
|
|
(D)
|
If
after the application of Subparagraph (C) an excess amount still
exists, the excess amount will be held unallocated in a suspense
account. The suspense account will be applied to reduce future
employer contributions for all active participants in the next limitation
year, and each succeeding limitation year if
necessary.
|
|
(E)
|
If
a suspense account is in existence at any time during a limitation year
pursuant to this Section 5.1(a)(4), it will not participate in the
allocation of the trust's investment gains and losses. If a
suspense account is in existence at any time during a particular
limitation year, all amounts in the suspense account must be allocated and
reallocated to participants' accounts before any employer, elective
deferral, or employee nondeductible contributions may be made to the plan
for that limitation year. Excess amounts may not be distributed
to participants or former
participants.
|
(b)
|
Combined Limitations – Other
Defined Contribution Plan
|
|
(1)
|
This
Section 5.1(b) applies if, in addition to this plan, the participant
is covered under another qualified defined contribution plan maintained by
the employer, a welfare benefit fund maintained by the employer, an
individual medical account maintained by the employer, or a simplified
employee pension maintained by the employer, that provides an annual
addition as defined in Section 5.1(c)(1), during any limitation
year. The annual additions that may be credited to a
participant's account under this plan for any such limitation year will
not exceed the maximum permissible amount reduced by the annual additions
credited to a participant's account under the other qualified defined
contribution plans, welfare benefit funds, individual medical accounts,
and simplified employee pensions for the same limitation
year. If the annual additions with respect to the participant
under other qualified defined contribution plans, welfare benefit funds,
individual medical accounts, and simplified employee pensions maintained
by the employer are less than the maximum permissible amount and the
employer contribution that would otherwise be contributed or allocated to
the participant's account under this plan would cause the annual additions
for the limitation year to exceed this limitation, the amount contributed
or allocated will be reduced so that the annual additions under all such
plans and funds for the limitation year will equal the maximum permissible
amount. If the annual additions with respect to the participant
under such other qualified defined contribution plans, welfare benefit
funds, individual medical accounts, and simplified employee pensions in
the aggregate are equal to or greater than the maximum permissible amount,
no amount will be contributed or allocated to the participant's account
under this plan for the limitation
year.
|
|
(2)
|
Prior
to determining the participant's actual compensation for the limitation
year, the employer may determine the maximum permissible amount for a
participant in the manner described in
Section 5.1(a)(2).
|
|
(3)
|
As
soon as is administratively feasible after the end of the limitation year,
the maximum permissible amount for the limitation year will be determined
on the basis of the participant's actual compensation for the limitation
year.
|
|
(4)
|
If,
pursuant to Section 5.1(b)(3) or as a result of the allocation of
forfeitures, a participant's annual additions under this plan and such
other plans would result in an excess amount for a limitation year, the
excess amount will be deemed to consist of the annual additions last
allocated, except that annual additions attributable to a simplified
employee pension will be deemed to have been allocated first, followed by
annual additions to a welfare benefit fund or individual medical account,
regardless of the actual allocation
date.
|
|
(5)
|
If
an excess amount was allocated to a participant on an allocation date of
this plan that coincides with an allocation date of another plan, the
excess amount will be disposed of in the manner provided in
Section 3.1(c).
|
|
(6)
|
Any
excess amount attributed to this plan will be disposed of in the manner
described in
Section 5.1(a)(4).
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(c)
|
Definitions (Code Section 415
Limitations)
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(1)
|
Annual Additions – The
sum of the following amounts credited to a participant's account for the
limitation year: (A) employer contributions;
(B) employee contributions (excluding catch-up contributions made in
accordance with Code section 414(v)); (C) forfeitures;
(D) amounts allocated to an individual medical account (as defined in
Code section 415(l)(2)), that is part of a pension or annuity plan
maintained by the employer are treated as annual additions to a defined
contribution plan; and (E) allocations under a simplified employee
pension. Also, amounts derived from contributions paid or
accrued that are attributable to postretirement medical benefits allocated
to the separate account of a key employee (as defined in Code
section 419A(d)(3)) under a welfare benefit fund (as defined in Code
section 419(e)) maintained by the employer are treated as annual
additions to a defined contribution
plan.
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Copyright © 2006 by
Conrad Siegel
Actuaries
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28
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Markets, Inc. Retirement Savings Plan
For this
purpose, any excess amount applied under Section 5.1(a)(4) or (b)(6)
in the limitation year to increase the accounts of participants who did not have
an excess amount or to reduce employer contributions will be considered annual
additions for such limitation year.
|
(2)
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Compensation – A
participant's earned income and any earnings reportable as W-2 wages for
federal income tax withholding purposes that are paid by the
employer. W-2 wages means wages as defined in Code
section 3401(a) but determined without regard to any rules that limit
the remuneration included in wages based on the nature or location of the
employment or the services performed (such as the exception for
agricultural labor in Code
section 3401(a)(2)).
|
For
purposes of applying the limitations of this Section 5.1, compensation for
a limitation year is the compensation actually paid or includable in gross
income during such limitation year.
In order
to be taken into account for a limitation year, compensation must be paid or
treated as paid prior to severance from employment with the
employer. Further, compensation in excess of the limitations of
Section 1.2(c) shall not be taken into account.
Compensation
shall include elective contributions as defined in Section 1.2(a) and
elective contributions under a Code section 501(c)(18)
plan. Elective contribution amounts under a cafeteria plan excludable
under Code section 125 shall include any amounts not available to a
participant in cash in lieu of group health coverage because the participant is
unable to certify that he has other health coverage (deemed section 125
compensation). An amount will be treated as an amount under Code
section 125 only if the employer does not request or collect information
regarding the participant's other health coverage as part of the enrollment
process for the health plan.
Notwithstanding
the preceding, compensation for a participant in a defined contribution plan who
is permanently and totally disabled (as defined in Code section 22(e)(3))
is the compensation such participant would have received for the limitation year
if the participant had been paid at the rate of compensation paid immediately
before becoming permanently and totally disabled; such imputed compensation for
the disabled participant may be taken into account only if contributions made on
behalf of such participant are nonforfeitable when made.
|
(3)
|
Defined Contribution Dollar
Limitation – $40,000, as adjusted under Code section 415(d)
for limitation years beginning after
December 31, 2002. The defined contribution dollar
limitation is $30,000, as adjusted under Code section 415(d) for
limitation years beginning before
January 1, 2003.
|
|
(4)
|
Employer – For purposes
of this Section 5.1, employer shall mean the employer as defined in
Section 1.5(b) but including all members of a controlled group of
corporations as defined in Code section 414(b) as modified by Code
section 415(h) and all commonly controlled trades or businesses as
defined in Code section 414(c) as modified by Code
section 415(h).
|
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(5)
|
Excess Amount – The
excess of the participant's annual additions for the limitation year over
the maximum permissible amount.
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(6)
|
Limitation Year – The
12-consecutive-month period defined in Section 1.3(f). All
qualified defined contribution plans maintained by the employer must use
the same limitation year. If the limitation year is amended to
a different 12-consecutive-month period, the new limitation year must
begin on a date within the limitation year in which the amendment is
made.
|
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(7)
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Maximum Permissible
Amount – For limitation years beginning before
January 1, 2002, the maximum annual addition that may be
contributed or allocated to a participant's account under the plan for any
limitation year shall not exceed the lesser of: (A) the
applicable defined contribution dollar limitation, or (B) 25% of the
participant's compensation for the limitation
year.
|
For
limitation years beginning on or after January 1, 2002, except to the
extent permitted under Section 3.4(b) and Code section 414(v), if
applicable, the maximum annual addition that may be contributed or allocated to
a participant's account under the plan for any limitation year shall not exceed
the lesser of:
Copyright © 2006 by
Conrad Siegel
Actuaries
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Markets, Inc. Retirement Savings Plan
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(A)
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the
defined contribution dollar limitation as defined in
Section 5.1(c)(3); or
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(B)
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100%
of the participant's compensation for the limitation
year.
|
The
compensation limitation referred to in (B) shall not apply to any contribution
for medical benefits after separation from service (within the meaning of Code
section 401(h) or Code section 419A(f)(2)) that is otherwise treated
as an annual addition under Code section 415(l)(1)
or 419A(d)(2).
If a
short limitation year is created because of an amendment changing the limitation
year to a different 12-consecutive-month period, the maximum permissible amount
will not exceed the defined contribution dollar limitation multiplied by the
following fraction:
Number of months in the
short limitation year
12
Section
5.2 – Joint and Survivor Annuity Requirements
No
annuity form of payment is provided under Section 4.3(b) and no direct or
indirect transfer is accepted under Section 3.7 from a defined benefit
plan, money purchase pension plan (including a target benefit plan), stock bonus
or profit sharing plan that would otherwise have provided for a life annuity
form of payment to any participant; therefore, the joint and survivor annuity
requirements of Code section 401(a)(11) and 417 shall not apply to
this plan, except as provided in this Section 5.2.
(a)
|
Restrictions on Immediate
Distributions – If the value of a participant's vested account
balance derived from employer and employee contributions (1) in plan
years beginning before January 1, 1998, exceeded $3,500 or
(2) in plan years beginning after January 1, 1997, exceeds
$5,000 and the account balance is immediately distributable, the
participant (or where the participant has died, the participant's spouse)
must consent to any distribution of such account
balance. Effective for distributions made on or after
March 22, 1999, for the purpose of determining the value of a
participant's vested account balance, prior distributions shall be
disregarded if distributions have not commenced under an optional form of
payment described in Section 4.3. The consent of the
participant (or the participant's surviving spouse) shall be obtained in
writing within the 90-day period ending on the annuity starting
date. The annuity starting date is the first day of the first
period for which an amount is paid in any form. The plan
administrator shall notify the participant (or the participant's surviving
spouse) of the right to defer any distribution until the participant's
account balance is no longer immediately distributable. Such
notification shall include a general description of the material features,
and an explanation of the relative values of, the optional forms of
benefit available under the plan in a manner that would satisfy the notice
requirements of Code section 417(a)(3), and shall be provided no less
than 30 days and no more than 90 days prior to the annuity
starting date. However, distribution may commence less than
30 days after the notice described in the preceding sentence is
given, provided the distribution is one to which Code
sections 401(a)(11) and 417 do not apply, the plan administrator
clearly informs the participant that the participant has a right to a
period of at least 30 days after receiving the notice to consider the
decision of whether or not to elect a distribution (and, if applicable, a
particular distribution option), and the participant, after receiving the
notice, affirmatively elects a
distribution.
|
Neither
the consent of the participant nor the participant's spouse shall be required to
the extent that a distribution is required to satisfy Code
section 401(a)(9) or section 415. In addition, upon
termination of this plan if the plan does not offer an annuity option (purchased
from a commercial provider) and if the employer or any entity within the same
controlled group as the employer does not maintain another defined contribution
plan (other than an employee stock ownership plan as defined in Code
section 4975(e)(7)), the participant's account balance will, without the
participant's consent, be distributed to the participant. However, if
any entity within the same controlled group as the employer maintains another
defined contribution plan (other than an employee stock ownership plan), the
participant's account balance will be transferred, without the participant's
consent, to the other plan if the participant does not consent to an immediate
distribution.
An
account balance is immediately distributable if any part of the account balance
could be distributed to the participant (or surviving spouse) before the
participant attains (or would have attained if not deceased) the later of normal
retirement age or age 62.
(b)
|
Safe Harbor Rules – This
Section 5.2(b) shall apply to a participant in this profit sharing
plan, and to any distribution, made on or after the first day of the first
plan year beginning after December 31, 1988, from or under a
separate account attributable solely to accumulated deductible employee
contributions, as defined in Code section 72(o)(5)(B), and maintained
on behalf of a participant in a money purchase pension plan (including a
target benefit plan). This plan satisfies and shall continue to
satisfy the following conditions:
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Copyright © 2006 by
Conrad Siegel
Actuaries
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30
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Markets, Inc. Retirement Savings Plan
(1) the
participant cannot elect payments in the form of a life annuity; and (2) on
the death of a participant, the participant's vested account balance will be
paid to the participant's surviving spouse, but if there is no surviving spouse,
or if the surviving spouse has consented in a manner conforming to a qualified
election, then to the participant's designated beneficiary. The
surviving spouse may elect to have distribution of the vested account balance
commence within the 90-day period following the date of the participant's
death. The account balance shall be adjusted for gains or losses
occurring after the participant's death in accordance with the provisions of the
plan governing the adjustment of account balances for other types of
distributions.
|
(1)
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The
participant may waive the spousal death benefit described in this
Section 5.2(b) at any time provided that no such waiver shall be
effective unless it satisfies the conditions of Section 5.2(c)(1)
that would apply to the participant's waiver of the qualified
preretirement survivor annuity.
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(2)
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For
purposes of this Section 5.2(b), vested account balance shall have
the same meaning as provided in
Section 5.2(c)(3).
|
(c)
|
Definitions (Code Section 417
Requirements)
|
|
(1)
|
Qualified Election – A
waiver of a qualified preretirement survivor annuity. Any
waiver of a qualified preretirement survivor annuity shall not be
effective unless: (a) the participant's spouse consents in
writing to the election; (b) the election designates a specific
beneficiary, including any class of beneficiaries or any contingent
beneficiaries, that may not be changed without spousal consent (or the
spouse expressly permits designations by the participant without any
further spousal consent); (c) the spouse's consent acknowledges the
effect of the election; and (d) the spouse's consent is witnessed by
a plan representative or notary public. If it is established to
the satisfaction of a plan representative that there is no spouse or that
the spouse cannot be located, a waiver will be deemed a qualified
election.
|
Any
consent by a spouse obtained under this provision (or establishment that the
consent of a spouse may not be obtained) shall be effective only with respect to
such spouse. A consent that permits designations by the participant
without any requirement of further consent by such spouse must acknowledge that
the spouse has the right to limit consent to a specific beneficiary, and a
specific form of benefit where applicable, and that the spouse voluntarily
elects to relinquish either or both of such rights. A revocation of a
prior waiver may be made by a participant without the consent of the spouse at
any time before the commencement of benefits. The number of
revocations shall not be limited.
|
(2)
|
Spouse (Surviving
Spouse) – The spouse or surviving spouse of the participant,
provided that a former spouse will be treated as the spouse or surviving
spouse and a current spouse will not be treated as the spouse or surviving
spouse to the extent provided under a qualified domestic relations order
as described in Code
section 414(p).
|
|
(3)
|
Vested Account Balance –
The aggregate value of the participant's vested account balances derived
from employer and employee contributions (including rollovers), whether
vested before or upon death, including the proceeds of insurance
contracts, if any, on the participant's life. The provisions of
this Section 5.2 shall apply to a participant who is vested in
amounts attributable to employer contributions, employee contributions, or
both at the time of death or
distribution.
|
Section
5.3 – Distribution Requirements
Subject
to Section 5.2 Joint and Survivor Annuity Requirements, the requirements of
this Section 5.3 shall apply to any distribution of a participant's
interest and will take precedence over any inconsistent provisions of this
plan.
With
respect to distributions under the plan made on or after
August 1, 2002 for calendar years beginning on or after
January 1, 2002, the plan will apply the minimum distribution
requirements as set forth in this Section 5.3. Distributions
made prior to August 1, 2002 are subject to the provisions of the plan
as in effect before this amendment and restatement of the plan. If
the total amount of required minimum distributions made to a participant
for 2002 prior to August 1, 2002 are equal to or greater than the
amount of required minimum distributions determined under this Section 5.3,
then no additional distributions are required for such participant for 2002
on or after such date. If the total amount of required minimum
distributions made to a participant for 2002 prior to
August 1, 2002 are less than the amount determined under this
Section 5.3, then the amount of required minimum distributions
for 2002 on or after such date will be determined so that the total amount
of required minimum distributions for 2002 is the amount determined under
this Section 5.3.
Copyright © 2006 by
Conrad Siegel
Actuaries
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Markets, Inc. Retirement Savings Plan
(a)
|
Required Beginning Date
– The entire interest of a participant must be distributed or begin to be
distributed no later than the participant's required beginning
date.
|
(b)
|
Limits on Distribution
Periods – As of the first distribution calendar year,
distributions, if not made in a single sum, may only be made over one of
the following periods (or a combination
thereof):
|
|
(1)
|
the
life of the participant;
|
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(2)
|
the
life of the participant and a designated
beneficiary;
|
|
(3)
|
a
period certain not extending beyond the life expectancy of the
participant; or
|
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(4)
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a
period certain not extending beyond the joint life and last survivor
expectancy of the participant and a designated
beneficiary.
|
(c)
|
Death of Participant Before
Distributions Begin – If the participant dies before distributions
begin, the participant's entire interest will be distributed, or begin to
be distributed, no later than as
follows:
|
|
(1)
|
If
the participant's surviving spouse is the participant's sole designated
beneficiary, then distributions to the surviving spouse will begin by
December 31 of the calendar year immediately following the calendar
year in which the participant died, or by December 31 of the calendar
year in which the participant would have attained age 70½, if
later. If the surviving spouse so elects, the participant's
entire interest will be distributed to such surviving spouse by
December 31 of the calendar year containing the fifth anniversary of
the participant's death. If no election is received,
distributions to the surviving spouse will begin by December 31 of
the calendar year in which the participant would have attained
age 70½, or the participant's entire interest will be distributed to
such surviving spouse by December 31 of the calendar year containing
the fifth anniversary of the participant's death, if
later.
|
|
(2)
|
If
the participant's surviving spouse is not the participant's sole
designated beneficiary, then distributions to the designated beneficiary
will begin by December 31 of the calendar year immediately following
the calendar year in which the participant died. If the
designated beneficiary so elects or if no election is received, the
participant's entire interest will be distributed to such designated
beneficiary by December 31 of the calendar year containing the fifth
anniversary of the participant's
death.
|
|
(3)
|
If
there is no designated beneficiary as of September 30 of the year
following the year of the participant's death, the participant's entire
interest will be distributed by December 31 of the calendar year
containing the fifth anniversary of the participant's
death.
|
|
(4)
|
If
the participant's surviving spouse is the participant's sole designated
beneficiary and the surviving spouse dies after the participant but before
distributions to the surviving spouse begin, this Section 5.3(c),
other than Section 5.3(c)(1), will apply as if the surviving spouse
were the participant.
|
For
purposes of this Section 5.3(c) and Section 5.3(f), unless
Section 5.3(c)(4) applies, distributions are considered to begin on the
participant's required beginning date. If Section 5.3(c)(4)
applies, distributions are considered to begin on the date distributions are
required to begin to the surviving spouse under
Section 5.3(c)(1). If distributions under an annuity purchased
from an insurance company irrevocably commence to the participant before the
participant's required beginning date (or to the participant's surviving spouse
before the date distributions are required to begin to the surviving spouse
under Section 5.3(c)(1)), the date distributions are considered to begin is
the date distributions actually commence.
(d)
|
Forms of Distribution –
Unless the participant's interest is distributed in the form of an annuity
purchased from an insurance company or in a single sum on or before the
required beginning date, as of the first distribution calendar year
distributions will be made in accordance with Subsection (2) and
(3). If the participant's interest is distributed in the form
of an annuity purchased from an insurance company, distributions
thereunder will be made in accordance with the requirements of Code
section 401(a)(9) and the Treasury
regulations.
|
To the
extent the participant has a Roth elective deferral account, an employee
nondeductible contribution account, or after-tax contributions of either type
for which there is separate accounting under his rollover/transfer account, such
funds shall be distributed in the order listed before any fully taxable
distribution is made to satisfy the minimum distribution
requirement. After the exhaustion of such accounts, distributions
shall be debited from a participant's accounts to the extent funded in
accordance with the following order of preference: rollover/transfer
account, qualified nonelective contribution account, profit sharing account,
employer matching contribution account, employee 401(k) elective deferral
account.
Copyright © 2006 by
Conrad Siegel
Actuaries
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(e)
|
Required Minimum Distributions
During Participant's Lifetime – If a participant's benefit is to be
distributed over (1) a period not extending beyond the life
expectancy of the participant or the joint life and last survivor
expectancy of the participant and the participant's designated beneficiary
or (2) a period not extending beyond the life expectancy of the
designated beneficiary, the amount required to be distributed for each
calendar year, beginning with distributions for the first distribution
calendar year, must at least equal the quotient obtained by dividing the
participant's benefit by the applicable life
expectancy.
|
|
(1)
|
Amount of Required Minimum
Distribution For Each Distribution Calendar Year – During the
participant's lifetime, the minimum amount that will be distributed for
each distribution calendar year is the lesser
of:
|
|
(A)
|
The
quotient obtained by dividing the participant's account balance by the
distribution period in the Uniform Lifetime Table set forth in Regulation
section 1.401(a)(9)-9, using the participant's age as of the
participant's birthday in the distribution calendar year;
or
|
|
(B)
|
If
the participant's sole designated beneficiary for the distribution
calendar year is the participant's spouse, the quotient obtained by
dividing the participant's account balance by the number in the Joint and
Last Survivor Table set forth in Regulation section 1.401(a)(9)-9,
using the participant's and spouse's attained ages as of the participant's
and spouse's birthdays in the distribution calendar
year.
|
|
(2)
|
Lifetime Required Minimum
Distributions Continue Through Year of Participant's Death –
Required minimum distributions will be determined under this
Section 5.3(e) beginning with the first distribution calendar year
and up to and including the distribution calendar year that includes the
participant's date of death.
|
|
(f)
|
Required Minimum Distributions
After Participant's Death
|
|
(1)
|
Death On or After Date
Distributions Begin – If the participant dies after distribution of
his interest has begun, the remaining portion of such interest will
continue to be distributed at least as rapidly as under the method of
distribution being used prior to the participant's
death.
|
|
(A)
|
Participant Survived by
Designated Beneficiary – If the participant dies on or after the
date distributions begin and there is a designated beneficiary, the
minimum amount that will be distributed for each distribution calendar
year after the year of the participant's death is the quotient obtained by
dividing the participant's account balance by the longer of the remaining
life expectancy of the participant or the remaining life expectancy of the
participant's designated beneficiary, determined as
follows:
|
|
(i)
|
The
participant's remaining life expectancy is calculated using the age of the
participant in the year of death, reduced by one for each subsequent
year.
|
|
(ii)
|
If
the participant's surviving spouse is the participant's sole designated
beneficiary, the remaining life expectancy of the surviving spouse is
calculated for each distribution calendar year after the year of the
participant's death using the surviving spouse's age as of the spouse's
birthday in that year. For distribution calendar years after
the year of the surviving spouse's death, the remaining life expectancy of
the surviving spouse is calculated using the age of the surviving spouse
as of the spouse's birthday in the calendar year of the spouse's death,
reduced by one for each subsequent calendar
year.
|
|
(iii)
|
If
the participant's surviving spouse is not the participant's sole
designated beneficiary, the designated beneficiary's remaining life
expectancy is calculated using the age of the beneficiary in the year
following the year of the participant's death, reduced by one for each
subsequent year.
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|
(B)
|
No Designated
Beneficiary – If the participant dies on or after the date
distributions begin and there is no designated beneficiary as of
September 30 of the year after the year of the participant's death,
the minimum amount that will be distributed for each distribution calendar
year after the year of the participant's death is the quotient obtained by
dividing the participant's account balance by the participant's remaining
life expectancy calculated using the age of the participant in the year of
death, reduced by one for each subsequent
year.
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Copyright © 2006 by
Conrad Siegel
Actuaries
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(2)
|
Death Before Date Distributions
Begin
|
|
(A)
|
Participant Survived by
Designated Beneficiary – If the participant dies before the date
distributions begin and there is a designated beneficiary, the minimum
amount that will be distributed for each distribution calendar year after
the year of the participant's death is the quotient obtained by dividing
the participant's account balance by the remaining life expectancy of the
participant's designated beneficiary, determined as provided in
Section 5.3(f)(1).
|
|
(B)
|
No Designated
Beneficiary – If the participant dies before the date distributions
begin and there is no designated beneficiary as of September 30 of
the year following the year of the participant's death, distribution of
the participant's entire interest will be completed by December 31 of
the calendar year containing the fifth anniversary of the participant's
death.
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|
(C)
|
Death of Surviving Spouse
Before Distributions to Surviving Spouse Are Required to Begin – If
the participant dies before the date distributions begin, the
participant's surviving spouse is the participant's sole designated
beneficiary, and the surviving spouse dies before distributions are
required to begin to the surviving spouse under Section 5.3(c), this
Section 5.3(f)(2) will apply as if the surviving spouse were the
participant.
|
(g)
|
Definitions (Code Section
401(a)(9) Requirements)
|
|
(1)
|
Designated Beneficiary –
The individual who is designated as the beneficiary under the plan and is
the designated beneficiary under Code section 401(a)(9) and
Regulation
section 1.401(a)(9)-4.
|
|
(2)
|
Distribution Calendar
Year – A calendar year for which a minimum distribution is
required. For distributions beginning before the participant's
death, the first distribution calendar year is the calendar year
immediately preceding the calendar year that contains the participant's
required beginning date. For distributions beginning after the
participant's death, the first distribution calendar year is the calendar
year in which distributions are required to begin pursuant to
Section 5.3(c). The required minimum distribution for the
participant's first distribution calendar year will be made on or before
the participant's required beginning date. The required minimum
distribution for other distribution calendar years, including the required
minimum distribution for the distribution calendar year in which the
participant's required beginning date occurs, will be made on or before
December 31 of that distribution calendar
year.
|
|
(3)
|
Life Expectancy – Life
expectancy as computed by use of the Single Life Table in Regulation
section 1.401(a)(9)-9.
|
|
(4)
|
Participant's Account
Balance – The account balance as of the last valuation date in the
calendar year immediately preceding the distribution calendar year
(valuation calendar year) increased by the amount of any contributions
made and allocated or forfeitures allocated to the account balance as of
dates in the valuation calendar year after the valuation date and
decreased by distributions made in the valuation calendar year after the
valuation date. The account balance for the valuation calendar
year includes any amounts rolled over or transferred to the plan either in
the valuation calendar year or in the distribution calendar year if
distributed or transferred in the valuation calendar
year.
|
If any
portion of the minimum distribution for the first distribution calendar year is
made in the second distribution calendar year on or before the required
beginning date, the amount of the minimum distribution made in the second
distribution calendar year shall be treated as if it had been made in the
immediately preceding distribution calendar year.
|
(5)
|
Required Beginning
Date
|
|
(A)
|
Non-5% Owner – The
required beginning date is April 1 of the calendar year following the
later of: (i) the calendar year in which the participant
attains age 70½, or (ii) the calendar year in which the
participant retires.
|
If a
participant who is not a 5% owner attains age 70½ after
December 31, 1995 and before January 1, 2003, the
participant shall be permitted to elect to commence the distribution of his
benefits as if his required beginning date were April 1 of the calendar
year following the calendar year in which he attains age 70½. If
an annuity form of payment is elected, the date as of which such distributions
commence shall be his annuity starting date for all purposes. If an
installment form of payment is elected, the participant shall have a new annuity
starting date as of the date payments are elected to commence following his
termination of employment.
Copyright © 2006 by
Conrad Siegel
Actuaries
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(B)
|
5% Owner – The required
beginning date for a participant who is a 5% owner is April 1 of
the calendar year following the calendar year in which the participant
attains age 70½. A participant is treated as a
5% owner for purposes of this Section 5.3(g)(5) if such
participant is a 5% owner as defined in Code section 416(i)
(determined in accordance with section 416 but without regard to
whether the plan is top-heavy) at any time during the plan year ending
with or within the calendar year in which such participant attains
age 70½.
|
|
(C)
|
Once
distributions have begun to a 5% owner under this
Section 5.3(g)(5), they must continue to be distributed, even if the
participant ceases to be a 5% owner in a subsequent
year.
|
Section
5.4 – Top-Heavy Provisions
(a)
|
Application of
Provisions – If the plan is or becomes top-heavy in any plan year
beginning after December 31, 1983, the provisions of
Section 5.4 will supersede any conflicting provisions in the
plan.
|
(b)
|
Minimum
Allocation
|
|
(1)
|
Except
as otherwise provided in Section 5.4(b)(3) and (4) below, the
employer contributions and forfeitures allocated on behalf of any
participant who is not a key employee shall not be less than the lesser of
3% of such participant's compensation or in the case where the employer
has no defined benefit plan that designates this plan to satisfy Code
section 401, the largest percentage of employer contributions and
forfeitures, as a percentage of key employee's compensation that may be
taken into account under Section 1.2(c), allocated on behalf of any
key employee for that year. For this purpose, amounts
contributed to the key employee's elective deferral account(s) shall be
included as allocations on his behalf for that year. However,
amounts contributed to a non-key employee's elective deferral account(s)
shall not be taken into account in determining whether he has received his
minimum allocation. The minimum allocation is determined
without regard to any Social Security contribution. This
minimum allocation shall be made even though, under other plan provisions,
the participant would not otherwise be entitled to receive an allocation,
or would have received a lesser allocation for the year because of
(i) the participant's failure to complete 1,000 hours of service
(or any equivalent provided in the plan), or (ii) the participant's
failure to make mandatory employee contributions to the plan, or
(iii) the participant's failure to make elective contributions to the
plan, or (iv) compensation less than a stated
amount.
|
|
(2)
|
For
purposes of computing the minimum allocation, compensation shall mean
compensation as defined in Section 5.1(c)(2), subject to the
limitations of Section 1.2(c).
|
|
(3)
|
The
provision in Section 5.4(b)(1) above shall not apply to any
participant who was not employed by the employer on the last day of the
plan year.
|
|
(4)
|
The
provision in Section 5.4(b)(1) above shall not apply to any
participant to the extent the participant is covered under any other plan
or plans of the employer and the employer has provided in Section 3.2
or 3.3 that the minimum allocation or benefit requirement applicable
to top-heavy plans will be met in the other plan or plans (including
another plan that consists solely of a cash or deferred arrangement that
meets the ADP safe harbor requirements and matching contributions with
respect to which the ACP safe harbor requirements are met). If
this plan is intended to meet the minimum allocation or benefit
requirement applicable to another plan or plans, the employer shall so
provide in Section 3.2(c) or 3.3(b), as
appropriate.
|
Notwithstanding
anything to the contrary herein and in Section 3.2(c) or 3.3(b), the
top-heavy requirements of Code section 416 and this Section 5.4 shall
not apply in any year beginning after December 31, 2001, in which the
plan consists solely of a cash or deferred arrangement that meets the ADP safe
harbor requirements as set forth in Sections 3.4(a) and 5.5(f) and
matching contributions with respect to which the ACP safe harbor requirements
are met as set forth in Sections 3.6 and 5.5(f).
|
(5)
|
The
minimum allocation required (to the extent required to be nonforfeitable
under Code section 416(b)) may not be forfeited under Code
section 411(a)(3)(B) or
411(a)(3)(D).
|
|
(6)
|
Matching Contributions –
Employer matching contributions shall be taken into account for purposes
of satisfying the minimum contribution requirements of Code
section 416(c)(2) and the plan if so provided in Section 3.2(c)
or 3.3(b). The preceding sentence shall apply with respect
to matching contributions under the plan or, if the plan provides that the
minimum contribution requirement shall be met in another plan, such other
plan. Employer matching contributions that are used to satisfy
the minimum contribution requirements shall be treated as matching
contributions for purposes of the actual contribution percentage test and
other requirements of Code
section 401(m).
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
35
|
Weis
Markets, Inc. Retirement Savings Plan
(c)
|
Adjustments in Code Section 415
Limits – If the plan is top-heavy, the defined benefit fraction and
the defined contribution fraction shall be computed by applying a factor
of 1.0 (instead of 1.25) to the applicable dollar limits under Code
section 415(b)(1)(A) and 415(c)(1)(A) for such year, unless the
plan meets the following
conditions:
|
|
(1)
|
Such
plan would not be a top-heavy plan if “90%” were substituted for “60%” in
the top-heavy tests; and
|
|
(2)
|
The
minimum employer contribution percentage under Section 5.4(b) is 4%
instead of 3%.
|
|
(3)
|
A
non-key employee who participates in this plan and in a defined benefit
plan aggregated herewith will receive in accordance with
Section 3.2(c)(2) or Section 3.3(b) either (i) a minimum
employer contribution of 7.5% under this plan or another defined
contribution plan aggregated herewith or (ii) a minimum nonintegrated
accrued benefit of 3% of average annual compensation, not to exceed a
cumulative accrued benefit of 30% under the defined benefit
plan.
|
However,
the reduced Code section 415 factor of 1.0 shall not apply under a
top-heavy plan with respect to any individual so long as there are no employer
contributions, forfeitures, or voluntary employee nondeductible contributions
allocated to such individual.
Effective
with respect to limitation years beginning after December 31, 1999,
this Section 5.4(c) shall no longer be in effect.
(d)
|
Minimum Vesting Schedule
– For any plan year in which this plan is top-heavy, the following minimum
vesting schedule shall automatically apply to the
plan:
|
Years
of Service
|
Vesting
Percentage
|
|||
0–1
Year
|
0 | % | ||
2
|
20 | % | ||
3
|
40 | % | ||
4
|
60 | % | ||
5
|
80 | % | ||
6
or More Years
|
100 | % |
The
minimum vesting schedule shall apply to all benefits within the meaning of Code
section 411(a)(7) except those attributable to employee contributions,
including benefits accrued before the effective date of Code section 416
and benefits accrued before the plan became top-heavy. Further, no
decrease in a participant's nonforfeitable percentage may occur in the event the
plan's status as top-heavy changes for any plan year. However, this
Section does not apply to the account balances of any employee who does not have
an hour of service after the plan has initially become top-heavy and such
employee's account balance attributable to employer contributions and
forfeitures will be determined without regard to this Section.
If the
vesting schedule under the plans shifts in or out of the above schedule for any
plan year because of the plan's top-heavy status, such shift shall constitute an
amendment to the vesting schedule and the provisions of Section 7.2(d)
and (e) shall apply.
(e)
|
Definitions (Code Section 416
Requirements)
|
|
(1)
|
Key Employee – In
determining whether the plan is top-heavy for plan years beginning after
December 31, 2001, key employee means any employee or former
employee (and the beneficiaries of such employee) who at any time during
the determination period is an officer of the employer if such
individual's annual compensation exceeds $130,000 (as adjusted under Code
section 416(i)(1) for plan years beginning after
December 31, 2002), a 5% owner of the employer, or a
1% owner of the employer who has an annual compensation of more than
$150,000. Annual compensation means compensation as defined in
Section 5.1(c)(2), but including elective contributions as defined in
Section 1.2(a) and elective contributions under a Code
section 457 plan or a Code section 501(c)(18) plan for any plan
year and subject to the limitations of Section 1.2(c). The
determination period is the plan year containing the determination
date. In determining whether an employee is a key employee in
2002, this paragraph shall be treated as having been in effect for the
last plan year beginning before
January 1, 2002.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
36
|
Weis
Markets, Inc. Retirement Savings Plan
In
determining whether a plan is top-heavy for plan years beginning before
January 1, 2002, key employee means any employee or former employee
(and the beneficiaries of such employee) who at any time during the
determination period was an officer of the employer if such individual's annual
compensation exceeded 50% of the dollar limitation under Code
section 415(b)(1)(A), an owner (or considered an owner under Code
section 318) of one of the ten largest interests in the employer if such
individual's compensation exceeded 100% of the dollar limitation under Code
section 415(c)(1)(A), a 5% owner of the employer, or a 1% owner
of the employer who had an annual compensation of more than
$150,000. Annual compensation means compensation as defined in
Section 5.1(c)(2), but including elective contributions as defined in
Section 1.2(a) and elective contributions under a Code section 457
plan or a Code section 501(c)(18) plan for any plan year and subject to the
limitations of Section 1.2(c). The determination period is the
plan year containing the determination date and the four preceding plan
years.
The
determination of who is a key employee will be made in accordance with Code
section 416(i)(1) and the applicable regulations and other guidance of
general applicability issued thereunder.
|
(2)
|
Top-Heavy Plan – For any
plan year beginning after December 31, 1983, this plan is
top-heavy if any of the following conditions
exists:
|
|
(A)
|
If
the top-heavy ratio for this plan exceeds 60% and this plan is not part of
any required aggregation group or permissive aggregation group of
plans.
|
|
(B)
|
If
this plan is a part of a required aggregation group of plans but not part
of a permissive aggregation group and the top-heavy ratio for the group of
plans exceeds 60%.
|
|
(C)
|
If
this plan is a part of a required aggregation group and part of a
permissive aggregation group of plans and the top-heavy ratio for the
permissive aggregation group exceeds
60%.
|
|
(3)
|
Top-Heavy
Ratio
|
|
(A)
|
If
the employer maintains one or more defined contribution plans (including
any Simplified Employee Pension Plan) and the employer has not maintained
any defined benefit plan that during the one-year period (five-year period
in determining whether the plan is top-heavy for plan years beginning
before January 1, 2002) ending on the determination date(s) has
or has had accrued benefits, the top-heavy ratio for this plan alone or
for the required or permissive aggregation group as appropriate is a
fraction, the numerator of which is the sum of the account balances of all
key employees as of the determination date(s) including any part of any
account balance distributed in the one-year period ending on the
determination date(s) (five-year period ending on the determination date
in the case of a distribution made for a reason other than severance from
employment, death or disability and in determining whether the plan is
top-heavy for plan years beginning before January 1, 2002), and
the denominator of which is the sum of all account balances including any
part of any account balance distributed in the one-year period ending on
the determination date(s) (five-year period ending on the determination
date in the case of a distribution made for a reason other than severance
from employment, death or disability and in determining whether the plan
is top-heavy for plan years beginning before January 1, 2002),
both computed in accordance with Code section 416 and the regulations
thereunder. Both the numerator and denominator of the top-heavy
ratio are increased to reflect any contribution not actually made as of
the determination date, but which is required to be taken into account on
that date under Code section 416 and the regulations
thereunder.
|
|
(B)
|
If
the employer maintains one or more defined contribution plans (including
any Simplified Employee Pension Plan) and the employer maintains or has
maintained one or more defined benefit plans that during the one-year
period (five-year period in determining whether the plan is top-heavy for
plan years beginning before January 1, 2002) ending on the
determination date(s) has or has had any accrued benefits, the top-heavy
ratio for any required or permissive aggregation group as appropriate is a
fraction, the numerator of which is the sum of account balances under the
aggregated defined contribution plan or plans for all key employees,
determined in accordance with (A) above, and the present value of
accrued benefits under the aggregated defined benefit plan or plans for
all key employees as of the determination date(s), and the denominator of
which is the sum of the account balances under the aggregated defined
contribution plan or plans for all participants, determined in accordance
with (A) above, and the present value of accrued benefits under the
defined benefit plan or plans for all participants as of the determination
date(s), all determined in accordance with Code section 416 and the
regulations thereunder. The accrued benefits under a defined
benefit plan in both the numerator and denominator of the top-heavy ratio
are increased for any distribution of an accrued benefit made in the
one-year period ending on the determination date (five-year period ending
on the determination date in the case of a distribution made for a reason
other than severance from employment, death or disability and in
determining whether the plan is top-heavy for plan years beginning before
January 1, 2002).
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
37
|
Weis
Markets, Inc. Retirement Savings Plan
|
(C)
|
For
purposes of Section 5.4(e)(3)(A) and (B) above the value of
account balances and the present value of accrued benefits will be
determined as of the most recent valuation date that falls within or ends
with the 12-month period ending on the determination date, except as
provided in Code section 416 and the regulations thereunder for the
first and second plan years of a defined benefit plan. The
account balances and accrued benefits of a participant (1) who is not
a key employee but who was a key employee in a prior year, or (2) who
has not been credited with at least one hour of service with any employer
maintaining the plan at any time during the one-year period (five-year
period in determining whether the plan is top-heavy for plan years
beginning before January 1, 2002) ending on the determination
date will be disregarded. The calculation of the top-heavy
ratio, and the extent to which distributions, rollovers, and transfers are
taken into account will be made in accordance with Code section 416
and the regulations thereunder. Deductible employee
contributions will not be taken into account for purposes of computing the
top-heavy ratio. When aggregating plans the value of account
balances and accrued benefits will be calculated with reference to the
determination dates that fall within the same calendar
year.
|
The
accrued benefit of a participant other than a key employee shall be determined
under (1) the method, if any, that uniformly applies for accrual purposes
under all defined benefit plans maintained by the employer, or (2) if there
is no such method, as if such benefit accrued not more rapidly than the slowest
accrual rate permitted under the fractional rule of Code
section 411(b)(1)(C).
Catch-up
contributions with respect to the current plan year shall not be taken into
account; however, catch-up contributions for prior years shall be taken into
account.
|
(4)
|
Permissive Aggregation
Group – The required aggregation group of plans plus any other plan
or plans of the employer that, when considered as a group with the
required aggregation group, would continue to satisfy the requirements of
Code sections 401(a)(4)
and 410.
|
|
(5)
|
Required Aggregation
Group – (1) Each qualified plan of the employer in which at
least one key employee participates or participated at any time during the
determination period (regardless of whether the plan has terminated), and
(2) any other qualified plan of the employer that enables a plan
described in (1) to meet the requirements of Code sections 401(a)(4)
or 410.
|
|
(6)
|
Determination Date – For
any plan year subsequent to the first plan year, the last day of the
preceding plan year. For the first plan year of the plan, the
last day of that year.
|
|
(7)
|
Valuation Date – The
last day of the plan year shall be the date as of which account balances
or accrued benefits are valued for purposes of calculating the top-heavy
ratio.
|
|
(8)
|
Present Value – Present
value shall be based only on the interest and mortality rates specified in
the employer’s defined benefit
plan.
|
|
(9)
|
Non-Key Employee – Any
employee who is not a key employee. Non-key employees include
employees who are former key
employees.
|
Section
5.5 – Limitations and Conditions Regarding Contributions Under Code Sections
402(g), 401(k), and 401(m)
(a)
|
(1) Limit Maximum Amount of
Elective Deferrals Under Code Section
402(g)
|
No
participant shall be permitted to have elective deferrals made under this plan,
or any other qualified plan, contract or arrangement maintained by the employer,
during any calendar year, in excess of the dollar limitation contained in Code
section 402(g) in effect for the participant's taxable year at the
beginning of such calendar year. If Section 3.4 so provides, in
the case of a participant age 50 or over by the end of the taxable year,
the dollar limitation described in the preceding sentence shall include the
amount of elective deferrals that are permitted to be catch-up
contributions. The dollar limitation contained in Code
section 402(g) is $10,500 for taxable years beginning in 2000 and 2001
increasing to $11,000 for taxable years beginning in 2002 and increasing
by $1,000 for each year thereafter up to $15,000 for taxable years
beginning in 2006 and later years. After 2006, the
Secretary of the Treasury will adjust the $15,000 dollar limitation for
cost-of-living increases under Code section 402(g)(4). Any such
adjustments will be in multiples of $500.
Copyright © 2006 by
Conrad Siegel
Actuaries
|
38
|
Weis
Markets, Inc. Retirement Savings Plan
|
(2)
|
Catch-up
Contributions
|
Catch-up
contributions means elective deferrals made to the plan that are in excess of an
otherwise applicable plan limit and that are made by participants who are
age 50 or over by the end of their taxable years. An otherwise
applicable plan limit is a limit in the plan that applies to elective deferrals
without regard to catch-up contributions, such as any limitation set forth in
Section 3.4, the limits on annual additions described in Section 5.1,
the dollar limitation on elective deferrals under Code section 402(g) (not
taking into account catch-up contributions) and the limit imposed by the actual
deferral percentage (ADP) test under Section 5.5(b). Catch-up
contributions for a participant for a taxable year may not exceed:
|
(A)
|
the
dollar limit on catch-up contributions under Code
section 414(v)(2)(B)(i) for the taxable year;
or
|
|
(B)
|
when
added to other elective deferrals, 85% of the participant’s compensation
for the taxable year.
|
The
dollar limit on catch-up contributions under Code section 414(v)(2)(B)(i)
is $1,000 for taxable years beginning in 2002, increasing by $1,000 for each
year thereafter up to $5,000 for taxable years beginning in 2006 and later
years. After 2006, the Secretary of the Treasury will adjust the
$5,000 limitation for cost-of-living increases under Code
section 414(v)(2)(C). Any such adjustments will be in multiples
of $500.
Catch-up
contributions shall not be:
|
(A)
|
subject
to the limits on annual additions;
|
|
(B)
|
taken
into account under the ADP test;
and
|
|
(C)
|
taken
into account in determining the minimum allocation under
Section 5.4(b); however, catch-up contributions made in prior years
shall be taken into account in determining whether the plan is
top-heavy.
|
Provisions
in the plan relating to catch-up contributions apply to elective deferrals made
after December 31, 2001.
|
(3)
|
Distribution of Excess Elective
Deferrals
|
A
participant may assign to this plan any excess elective deferrals made during a
taxable year of the participant by following the claim procedure set forth in
Section 5.5(a)(4). Also, the employer may notify this plan on
behalf of a participant who has excess deferrals for the taxable year calculated
by taking into account only elective deferrals under the plans, contracts or
arrangements maintained by the employer.
Notwithstanding
any other provision of the plan, excess elective deferrals, plus any income and
minus any loss allocable thereto, shall be distributed no later than
April 15 to any participant to whose account excess elective deferrals were
assigned for the preceding year and for whom excess elective deferrals have been
claimed for such taxable year or calendar year.
|
(4)
|
Claims
|
The
participant's claim shall be submitted in writing to the plan administrator no
later than March 1. The participant shall specify the excess
deferral amount for the preceding calendar year and shall provide a written
statement that if such amounts are not distributed, such excess deferral amount,
when added to amounts deferred under other plans or arrangements described in
Code sections 401(k), 408(k), 457, or 403(b), exceeds the limit
imposed on the participant by Code section 402(g) for the year in which the
deferral occurred.
|
(5)
|
Definitions (Code Section
402(g) Limitations)
|
|
(A)
|
Elective Deferrals shall
mean any employer contributions made to the plan at the election of the
participant, in lieu of cash compensation, and shall include contributions
made pursuant to a salary reduction agreement or other deferral
mechanism. With respect to any taxable year, a participant's
elective deferral is the sum of all employer contributions made on behalf
of such participant pursuant to an election to defer under any qualified
cash or deferred arrangement as described in Code section 401(k), any
salary reduction simplified employee pension described in
section 408(k)(6), any SIMPLE IRA plan described in
section 408(p), any plan as described under section 501(c)(18),
and any employer contributions made on the behalf of a participant for the
purchase of an annuity contract under section 403(b) pursuant to a
salary reduction agreement. Elective deferrals shall not
include any deferrals properly distributed as excess annual
additions.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
39
|
Weis
Markets, Inc. Retirement Savings Plan
|
(B)
|
Excess Elective
Deferrals shall mean those elective deferrals that
either: (i) are made during the participant's taxable year
and exceed the dollar limitation under Section 5.5(a) (including, if
applicable, the dollar limitation on catch-up contributions described in
Section 5.5(a)(2)) for such year; or (ii) are made during a
calendar year and exceed such dollar limitations for the participant's
taxable year beginning in such calendar year, counting only elective
deferrals made under this plan and any other plan, contract or arrangement
maintained by the employer. Excess elective deferrals shall be
treated as annual additions under the plan, unless such amounts are
distributed no later than the first April 15 following the close of
the participant's taxable year.
|
|
(6)
|
Determination of Income or
Loss
|
Excess
elective deferrals shall be adjusted for any income or loss. The
income or loss allocable to excess elective deferrals is the income or loss
allocable to the participant's elective deferral account(s) for the taxable year
multiplied by a fraction, the numerator of which is such participant's excess
elective deferrals for the year and the denominator is the participant's account
balance attributable to elective deferrals without regard to any income or loss
occurring during such taxable year.
(b)
|
(1) Actual Deferral Percentage
Test
|
Effective
for plan years beginning on or after January 1, 1997, the actual
deferral percentage (hereinafter “ADP”) for a plan year for participants who are
highly compensated employees for the plan year and the prior year's ADP for
participants who were non-highly compensated employees for the prior plan year
must satisfy one of the following tests: (i) The ADP for a plan
year for participants who are highly compensated employees for the plan year
shall not exceed the prior year's ADP for participants who were non-highly
compensated employees for the prior plan year multiplied by 1.25; or
(ii) The ADP for a plan year for participants who are highly compensated
employees for the plan year shall not exceed the prior year's ADP for
participants who were non-highly compensated employees for the prior plan year
multiplied by 2.0, provided that the ADP for participants who are highly
compensated employees does not exceed the ADP for participants who were
non-highly compensated employees in the prior plan year by more than two
(2) percentage points.
In place
of the prior year testing method described above, if so elected by the employer
and adopted in Section 3.4(a), the ADP tests in (i) and (ii) will be
applied by comparing the current plan year's ADP for participants who are highly
compensated employees with the current plan year's ADP for participants who are
non-highly compensated employees. In the alternative, the plan may
satisfy the ADP test requirements by meeting the ADP test safe harbor
requirements as described in Section 5.5(f). Election of this
method shall be treated as an election to use the current year testing
method. Once the current year testing method election has been made,
the employer can elect prior year testing for a plan year only if the plan has
used current year testing for each of the preceding 5 plan years (or if
lesser, the number of plan years the plan has been in existence) or if, as a
result of a merger or acquisition described in Code
section 410(b)(6)(c)(i), the employer maintains both a plan using prior
year testing and a plan using current year testing and the change is made within
the transition period described in
section 410(b)(6)(c)(ii). Such elections shall be reflected in
Section 3.4(a).
|
(A)
|
Special Rules Applying to ADP
Test
|
|
(i)
|
A
participant is a highly compensated employee for a particular plan year if
he meets the definition of a highly compensated employee in effect for
that plan year. A participant is a non-highly compensated
employee for a particular plan year if he does not meet the definition of
a highly compensated employee in effect for that plan
year.
|
|
(ii)
|
The
ADP for any participant who is a highly compensated employee for the plan
year and who is eligible to have elective deferrals (and qualified
nonelective contributions or qualified matching contributions, or both, to
the extent treated as elective deferrals for purposes of the ADP test)
allocated to his accounts under two or more arrangements described in Code
section 401(k), that are maintained by the employer, shall be
determined as if such elective deferrals (and, to the extent taken into
account, such qualified nonelective contributions or qualified matching
contributions, or both) were made under a single
arrangement. If a highly compensated employee participates in
two or more cash or deferred arrangements of the employer that have
different plan years, all elective deferrals made during the plan year for
this plan under all such arrangements shall be aggregated. For
plan years beginning before January 1, 2006, all elective
deferrals made under all such cash or deferred arrangements ending with or
within the same calendar year shall be treated as a single
arrangement. Notwithstanding the foregoing, certain plans shall
be treated as separate if mandatorily disaggregated under regulations
under Code section 401(k).
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
40
|
Weis
Markets, Inc. Retirement Savings Plan
|
(iii)
|
In
the event that this plan satisfies the requirements of Code
sections 401(k), 401(a)(4), or 410(b) only if aggregated with
one or more other plans, or if one or more other plans satisfy the
requirements of such sections only if aggregated with this plan, then this
Section 5.5(b)(1) shall be applied by determining the ADP of
employees as if all such plans were a single plan. If more than
10% of the employer's non-highly compensated employees are involved in a
plan coverage change as defined in Regulation
section 1.401(k)-2(c)(4), then any adjustments to the nonhighly
compensated employees' ADP for the prior year shall be made in accordance
with such regulation, unless the employer has elected in
Section 3.4(a) to use the current year testing method. For
plan years beginning after December 31, 1989, plans may be
aggregated in order to satisfy Code section 401(k) only if they have
the same plan year. For plan years beginning after
December 31, 1996, plans may be permissively aggregated in order
to satisfy Code section 401(k) only if they use the same ADP testing
method.
|
|
(iv)
|
If: (A) this
plan is not a successor plan (as defined in Regulation
section 1.401(k)-2(c)(2)(iii)), (B) this plan is not aggregated
under Regulation section 1.401(k)-1(b)(4) for such plan year with any
other plan that was or that included a Code section 401(k) plan in
the prior year, and (C) the first plan year commences after
December 31, 1996; then, in the case of the first plan year the
plan permits any participant to make elective deferrals the amount treated
as the ADP for participants who are non-highly compensated employees for
the prior plan year shall be 3% or, if the employer so elects, the ADP for
participants who are non-highly compensated employees as calculated for
such first plan year. Such election shall be set forth in
Section 3.4(a).
|
|
(v)
|
For
purposes of determining the ADP test, elective deferrals, qualified
nonelective contributions and qualified matching contributions must be
made before the last day of the twelve-month period immediately following
the plan year to which contributions relate. An elective
deferral shall be taken into account only if it relates to compensation
that either (a) would have been received by the participant in the
plan year but for the deferral election, or (b) is attributable to
services performed by the participant in the plan year and would have been
received by the participant within 2½ months after the last day of
the plan year but for the deferral
election.
|
When the
prior year testing method is used, qualified nonelective contributions and
qualified matching contributions shall not be taken into account.
|
(vi)
|
The
plan administrator shall maintain records sufficient to demonstrate
satisfaction of the ADP test and the amount of qualified nonelective
contributions or qualified matching contributions, or both, used in such
test.
|
|
(vii)
|
When
the current year testing method is used, qualified nonelective
contributions may be taken into account as elective deferrals only to the
extent needed to meet the ADP test. Further, qualified matching
contributions may be taken into account only to the extent such
contributions are not needed to meet the average deferral percentage test
unless it is the intention of the plan administrator to test all qualified
nonelective and matching contributions under the ADP
test.
|
(viii)
|
Effective
for plan years beginning on or after January 1, 2006, qualified
nonelective contributions cannot be taken into account for a plan year for
a non-highly compensated employee to the extent such contributions exceed
the product of that non-highly compensated employee's compensation and the
greater of 5% or two times the plan's representative contribution
rate. For this purpose, the plan's representative contribution
rate is the lowest applicable contribution rate of any eligible non-highly
compensated employee among a group of eligible non-highly compensated
employees that consists of half of all eligible non-highly compensated
employees for the plan year (or, if greater, the lowest applicable
contribution rate of any eligible non-highly compensated employee in the
group of all eligible non-highly compensated employees for the plan year
and who is employed by the employer on the last day of the plan
year).
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
41
|
Weis
Markets, Inc. Retirement Savings Plan
The
applicable contribution rate for an eligible non-highly compensated employee is
the sum of his qualified matching contributions taken into account under the ADP
test and his qualified nonelective contributions for the plan year, divided by
his compensation for the same period. Notwithstanding the preceding,
qualified nonelective contributions that are made in connection with an
employer's obligation to pay prevailing wages under the Davis-Bacon Act can be
taken into account for a plan year for a non-highly compensated employee to the
extent such contributions do not exceed 10% of his compensation.
|
(ix)
|
Applicable
limitations when testing changes from current year testing to prior year
testing: The ADP for the prior plan year shall be determined
taking into account only: (A) elective contributions for
non-highly compensated employees that were taken into account for purposes
of the ADP test in the prior plan year under the current plan year testing
method and (B) qualified nonelective contributions not previously
taken into account under either the ADP or ACP
test.
|
|
(x)
|
The
determination and treatment of the ADP amounts of any participant shall
satisfy such other requirements as may be prescribed by the Secretary of
the Treasury.
|
|
(B)
|
Actual Deferral
Percentage (ADP) shall mean, for a specified group of participants
(either highly compensated employees or non-highly compensated employees)
for a plan year, the average of the ratios (calculated separately for each
participant in such group) of (1) the amount of employer
contributions actually paid over to the trust on behalf of such
participant for the plan year to (2) the participant's compensation
as defined in Section 1.2(e). The actual deferral ratio of
each participant and the actual deferral percentage of each group shall be
calculated to the nearest hundredth of a percentage
point. Employer contributions on behalf of any participant
shall include: (1) any elective deferrals (other than catch-up
contributions) made pursuant to the participant's deferral election,
including excess elective deferrals of highly compensated employees, but
excluding (a) excess elective deferrals of nonhighly compensated
employees that arise solely from elective deferrals to the extent the
excess deferrals are prohibited under Code section 401(a)(30) due to
the contributions made under this plan and without taking into account
deferrals made under an unrelated employer's plan and (b) elective
deferrals that are taken into account in the actual contribution
percentage test (provided the ADP test is satisfied both with and without
exclusion of these elective deferrals); and (2) at the election of
the employer, qualified nonelective contributions and qualified matching
contributions. For purposes of computing actual deferral
percentages, an employee who would be a participant but for the failure to
make elective deferrals shall be treated as a participant on whose behalf
no elective deferrals are made. Amounts distributed under
Section 5.1(a)(4)(B) shall not be included in the calculation of the
ADP.
|
|
(2)
|
Distribution of Excess
Contributions
|
Notwithstanding
any other provision of this plan, excess contributions, plus any income and
minus any loss allocable thereto, shall be distributed no later than the last
day of each plan year to participants to whose accounts such excess
contributions were allocated for the preceding plan year, except to the extent
such excess contributions are classified as catch-up
contributions. If such excess amounts (other than catch-up
contributions) are distributed more than 2½ months after the last day of
the plan year in which such excess amounts arose, a 10% excise tax will be
imposed on the employer maintaining the plan with respect to such
amounts. Excess contributions shall be allocated to the highly
compensated employees with the largest amounts of contributions taken into
account in calculating the ADP test for the plan year in which the excess arose,
beginning with the highly compensated employee with the largest amount of such
contributions and continuing in descending order until all of the excess
contributions have been allocated. To the extent a highly compensated
employee has not reached his catch-up contribution limit under the plan, excess
contributions allocated to such highly compensated employee shall be recognized
as catch-up contributions and will not be treated as excess
contributions.
Excess
contributions shall be treated as annual additions under the plan even if
distributed.
Copyright © 2006 by
Conrad Siegel
Actuaries
|
42
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Weis
Markets, Inc. Retirement Savings Plan
|
(A)
|
Determination of Income or
Loss – Excess contributions shall be adjusted for any income or
loss. The income or loss allocable to excess contributions
allocated to each participant is the sum of: (i) the
income or loss allocable to the participant's elective deferral account(s)
(and, if applicable, the qualified nonelective contribution account or the
qualified employer matching contribution account or both) for the plan
year multiplied by a fraction, the numerator of which is such
participant's excess contributions for the year and the denominator is the
participant's account balance(s) attributable to elective deferrals (and
qualified nonelective contributions or qualified matching contributions,
or both, if any of such contributions are included in the ADP test)
without regard to any income or loss occurring during such plan year; and
(ii) effective for plan years beginning on or after
January 1, 2006, and to the extent the excess contributions are
or will be credited with gain or loss as of an accounting date within the
gap period (i.e., the period after the close of the plan year and prior to
the distribution), 10% of the amount determined under (i) multiplied by
the number of whole calendar months between the end of the plan year and
the date of distribution, counting the month of distribution if
distribution occurs after the 15th of such
month.
|
|
(B)
|
Accounting for Excess
Contributions – Excess contributions allocated to a participant
shall be distributed from the participant's elective deferral account(s)
and qualified employer matching contribution account (if applicable) in
proportion to the participant's elective deferrals and qualified matching
contributions (to the extent used in the ADP test) for the plan
year. Excess contributions shall be distributed from the
participant's qualified nonelective contribution account only to the
extent that such excess contributions exceed the balance in the
participant's elective deferral account(s) and employer matching
contribution account.
|
|
(C)
|
Excess Contributions
shall mean, with respect to any plan year, the excess
of: (i) The aggregate amount of employer contributions
actually taken into account in computing the ADP of highly compensated
employees for such plan year, over (ii) The maximum amount of such
contributions permitted by the ADP test (determined by hypothetically
reducing contributions made on behalf of highly compensated employees in
order of the ADPs, beginning with the highest of such
percentages).
|
Such
determination shall be made after first determining excess elective deferrals
pursuant to Section 5.5(a).
(c)
|
(1)
Limitations on Employee and
Matching Contributions Under Code
Section 401(m)
|
Effective
for plan years beginning on or after January 1, 1997, the actual
contribution percentage (hereinafter “ACP”) for a plan year for participants who
are highly compensated employees for the plan year and the prior year's ACP for
participants who were non-highly compensated employees for the prior plan year
must satisfy one of the following tests: (i) The ACP for a plan
year for participants who are highly compensated employees for the plan year
shall not exceed the prior year's ACP for participants who were non-highly
compensated employees for the prior plan year multiplied by 1.25; or
(ii) The ACP for a plan year for participants who are highly compensated
employees for the plan year shall not exceed the prior year's ACP for
participants who were non-highly compensated employees for the prior plan year
multiplied by 2.0, provided that the ACP for participants who are highly
compensated employees does not exceed the ACP for participants who were
non-highly compensated employees in the prior plan year by more than two
(2) percentage points.
In place
of the prior year testing method described above, if so elected by the employer
and adopted in Section 3.6, the ACP tests in (i) and (ii) will be
applied by comparing the current plan year's ACP for participants who are highly
compensated employees with the current plan year's ACP for participants who are
non-highly compensated employees. In the alternative, the plan may
satisfy the ACP test requirements by meeting the safe harbor requirements of
Section 5.5(f)(3) and (4). Election of this method shall be
treated as an election to use the current year testing method. In
such a plan year, the current year testing method shall be used for the purpose
of testing any employee nondeductible contributions. Once the current
year testing method election has been made, the employer can elect prior year
testing for a plan year only if the plan has used current year testing for each
of the preceding 5 plan years (or if lesser, the number of plan years the
plan has been in existence) or if, as a result of a merger or acquisition
described in Code section 410(b)(6)(c)(i), the employer maintains both a
plan using prior year testing and a plan using current year testing and the
change is made within the transition period described in
section 410(b)(6)(c)(ii). Such elections shall be reflected in
Section 3.6.
|
(A)
|
Special Rules for Limitations
Under Code Section 401(m)
|
|
(i)
|
A
participant is a highly compensated employee for a particular plan year if
he meets the definition of a highly compensated employee in effect for
that plan year. A participant is a nonhighly compensated
employee for a particular plan year if he does not meet the definition of
a highly compensated employee in effect for that plan
year.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
43
|
Weis
Markets, Inc. Retirement Savings Plan
|
(ii)
|
Multiple
Use: If one or more highly compensated employees are
subject to both the ADP test and the ACP test and the sum of the ADP and
ACP of those highly compensated employees subject to either or both tests
exceeds the aggregate limit, then for plan years beginning before
January 1, 2002 either the ADP or the ACP of those highly
compensated employees who are subject to both tests will be reduced (in
accordance with Section 5.5(b)(2) or Section 5.5(c)(2), as
applicable) so that the limit is not exceeded. The plan
administrator shall determine whether the ADP or the ACP for the plan will
be reduced for the plan year. The amount by which each highly
compensated employee's percentage is reduced shall be treated as either an
excess contribution or an excess aggregate contribution, as
appropriate. The ADP and ACP of the highly compensated
employees are determined after any corrections required to meet the ADP
and ACP tests and are deemed to be the maximum permitted under such tests
for the plan year. Multiple use does not occur if both the ADP
and ACP of the highly compensated employees does not exceed 1.25
multiplied by the ADP and ACP of the non-highly compensated
employees. Multiple use shall not occur if the ADP test is met
by satisfying the ADP safe harbor requirements of Section 5.5(f)(2)
or if the ACP test is met by satisfying the ACP safe harbor requirements
of Section 5.5(f)(3), the plan administrator meets the notice
requirements of Section 5.5(f)(4), and there are no employee
nondeductible contributions under a plan sponsored by the
employer. Restrictions on multiple use do not apply for plan
years beginning after
December 31, 2001.
|
|
(iii)
|
For
purposes of this Section 5.5(c)(1), the contribution percentage for
any participant who is a highly compensated employee and who is eligible
to have contribution percentage amounts allocated to his account under two
or more plans described in Code section 401(a), or arrangements
described in Code section 401(k) that are maintained by the employer,
shall be determined as if the total of such contribution percentage
amounts were made under each plan and arrangement. If a highly
compensated employee participates in two or more such plans or cash or
deferred arrangements that have different plan years, all contribution
percentage amounts made during the plan year for this plan under all such
plans and arrangements shall be aggregated. For plan years
beginning before January 1, 2006, all such plans and cash or
deferred arrangements ending with or within the same calendar year shall
be treated as a single arrangement. Notwithstanding the
foregoing, certain plans shall be treated as separate if mandatorily
disaggregated under regulations under Code
section 401(m).
|
|
(iv)
|
In
the event that this plan satisfies the requirements of Code
sections 401(m), 401(a)(4) or 410(b) only if aggregated with one
or more other plans, or if one or more other plans satisfy the
requirements of such sections only if aggregated with this plan, then this
Section 5.5(c)(1) shall be applied by determining the ACP of
employees as if all such plans were a single plan. If more than
10% of the employer's non-highly compensated employees are involved in a
plan coverage change as defined in Regulation
section 1.401(m)-2(c)(4), then any adjustments to the nonhighly
compensated employee ACP for the prior year shall be made in accordance
with such regulation, unless the employer has elected in Section 3.6
to use the current year testing method. For plan years
beginning after December 31, 1989, plans may be aggregated in
order to satisfy Code section 401(m) only if they have the same plan
year. For plan years beginning after
December 31, 1996, plans may be permissively aggregated in order
to satisfy Code section 401(m) only if they use the same ACP testing
method.
|
|
(v)
|
If: (A) this
plan is not a successor plan (as defined in Regulation
section 1.401(m)-2(c)(2)(iii)), (B) this plan is not aggregated
under Regulation section 1.401(m)-1(b)(4) for such plan year with any
other plan that was or that included a Code section 401(m) plan in
the prior year, and (C) the first plan year commences after
December 31, 1996; then, in the case of the first plan year this
plan permits any participant to make employee contributions, provides for
matching contributions or both the amount treated as the ACP for
participants who are non-highly compensated employees for the prior plan
year shall be 3% or, if the employer so elects, the ACP for participants
who are non-highly compensated employees as calculated for such first plan
year. Such election shall be set forth in
Section 3.6.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
44
|
Weis
Markets, Inc. Retirement Savings Plan
|
(vi)
|
For
purposes of determining the ACP test, employee contributions are
considered to have been made in the plan year in which contributed to the
trust. Matching contributions and qualified nonelective
contributions will be considered made for a plan year if made no later
than the end of the twelve-month period beginning on the day after the
close of the plan year.
|
When the
prior year testing method is used, qualified nonelective contributions shall not
be taken into account.
|
(vii)
|
The
plan administrator shall maintain records sufficient to demonstrate
satisfaction of the ACP test and the amount of qualified nonelective
contributions or qualified matching contributions, or both, used in such
test.
|
(viii)
|
Elective
deferral contributions may be taken into account; however, the ADP test
shall be met before any elective deferrals are used in the ACP test and
the elective deferrals needed to meet the ADP test shall not be used to
meet the ACP test. When the current year testing method is
used, qualified nonelective contributions shall be taken into account to
the extent such contributions are not used to meet the ADP
test.
|
(ix)
|
Effective
for plan years beginning on or after January 1, 2006, a matching
contribution with respect to an elective deferral for a non-highly
compensated employee shall not be taken into account under the ACP test to
the extent it exceeds the greatest of: (A) 5% of
compensation; (B) the employee's elective deferrals for a year; and
(C) the product of 2 times the plan's representative matching rate
and the employee's elective deferrals for a year. For this
purpose, the plan's representative matching rate is the lowest matching
rate for any eligible non-highly compensated employee among a group of
non-highly compensated employees that consists of half of all eligible
non-highly compensated employees in the plan for the plan year who make
elective deferrals for the plan year (or, if greater, the lowest matching
rate for all eligible non-highly compensated employees in the plan who are
employed by the employer on the last day of the plan year and who make
elective deferrals for the plan
year).
|
The
matching rate for an employee generally is the matching contributions made for
such employee divided by his elective deferrals (and employee nondeductible
contributions) for the year. If the matching rate is not the same for
all levels of his elective deferrals (and employee nondeductible contributions),
the employee's matching rate is determined assuming that his elective deferrals
are equal to 6% of compensation.
|
(x)
|
Applicable
limitations when testing changes from current year testing to prior year
testing: The ACP for the prior plan year shall be determined
taking into account only: (A) employee contributions for
non-highly compensated employees made for the prior plan year,
(B) matching contributions for non-highly compensated employees that
were taken into account for purposes of the ACP test in the prior plan
year under the current plan year testing method, and (C) qualified
nonelective contributions not previously taken into account under either
the ADP or ACP test.
|
|
(xi)
|
The
determination and treatment of the ACP amounts of any participant shall
satisfy such other requirements as may be prescribed by the Secretary of
the Treasury.
|
|
(B)
|
Definitions (Code Section
401(m) Limitations)
|
|
(i)
|
Aggregate Limit, for
plan years beginning before January 1, 2002 only, shall mean the
sum of (i) 125% of the greater of the ADP of the nonhighly
compensated employees for the prior plan year or the ACP of nonhighly
compensated employees under the plan subject to Code section 401(m)
for the plan year beginning with or within the prior plan year of the
401(k) plan and (ii) the lesser of 200% or two plus the lesser of
such ADP or ACP. “Lesser” is substituted for “greater”
in (i) above, and “greater” is substituted for “lesser” after “two
plus the” in (ii) if it would result in a larger aggregate
limit. If the employer has elected the use of the current year
testing method, then, in calculating the aggregate limit for a particular
plan year, the nonhighly compensated employees' ADP and ACP for that plan
year is used in place of the ADP and ACP for the prior plan
year.
|
|
(ii)
|
Actual Contribution
Percentage (ACP) shall mean, for a specified group of participants
(either highly compensated employees or non-highly compensated employees)
for a plan year, the average of the contribution percentages of the
eligible participants in the group.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
45
|
Weis
Markets, Inc. Retirement Savings Plan
|
(iii)
|
Contribution Percentage
shall mean the ratio (expressed as a percentage calculated to the nearest
hundredth of a percentage point) of the participant's contribution
percentage amounts to the participant's compensation as defined in
Section 1.2(e).
|
|
(iv)
|
Contribution Percentage
Amounts shall mean the sum of the employee nondeductible
contributions, employer matching contributions and elective deferrals (to
the extent not taken into account for purposes of the ADP test) made under
the plan on behalf of the participant for the plan year. Such
contribution percentage amounts shall not include matching contributions
that are forfeited either to correct excess aggregate contributions or
because the contributions to which they relate are excess deferrals,
excess contributions, or excess aggregate
contributions. Qualified nonelective contributions may be
included in the contribution percentage amounts. Elective
deferrals may also be used in calculating the contribution percentage
amounts so long as the ADP test is met before the elective deferrals are
used in the ACP test and the ADP test continues to be met following the
exclusion of those elective deferrals that are used to meet the ACP
test. The contribution percentage amounts shall be calculated
to the nearest hundredth of a percentage point. Amounts
distributed under Section 5.1(a)(4)(A) and (B) shall not be
included in the calculation.
|
|
(v)
|
Eligible Participant
shall mean any employee who is eligible to make an employee nondeductible
contribution, or an elective deferral (if the employer takes such
contributions into account in the calculation of the contribution
percentage), or to receive an employer matching contribution (including
forfeitures). If an employee nondeductible contribution is
required as a condition of participation in the plan, any employee who
would be a participant in the plan if such employee made such a
contribution shall be treated as an eligible participant on behalf of whom
no employee contributions are made.
|
|
(vi)
|
Employee Nondeductible
Contribution (or employee contribution) shall mean any contribution
made under Section 3.5 to the plan by or on behalf of a participant
that is included in the participant's gross income in the year in which
made and that is maintained under a separate account to which earnings and
losses are allocated.
|
|
(vii)
|
Matching Contribution
shall mean an employer contribution made to this or any other defined
contribution plan on behalf of a participant on account of an employee
nondeductible contribution made by such participant, or on account of a
participant's elective deferral, under a plan maintained by the
employer.
|
|
(2)
|
Distribution of Excess
Aggregate Contributions
|
Notwithstanding
any other provision of this plan, excess aggregate contributions, plus any
income and minus any loss allocable thereto, shall be forfeited, if forfeitable,
or if not forfeitable, distributed no later than the last day of each plan year
to participants to whose accounts such excess aggregate contributions were
allocated for the preceding plan year. Excess aggregate contributions
shall be allocated to the highly compensated employees with the largest
contribution dollar amounts taken into account in calculating the ACP test for
the plan year in which the excess arose, beginning with the highly compensated
employee with the largest dollar amount of such contributions and continuing in
descending order until all of the excess aggregate contributions have been
allocated. If such excess aggregate contributions are distributed
more than 2½ months after the last day of the plan year in which such
excess amounts arose, a 10% excise tax will be imposed on the employer
maintaining the plan with respect to those amounts. Excess aggregate
contributions shall be treated as annual additions under the plan even if
distributed.
|
(A)
|
Determination of Income or
Loss – Excess aggregate contributions shall be adjusted for any
income or loss. The income or loss allocable to excess
aggregate contributions allocated to each participant is the sum
of: (i) the income or loss allocable to the participant's
employee nondeductible contribution account, employer matching
contribution account (if any, and if all amounts therein are not used in
the ADP test) and, if applicable, qualified nonelective contribution
account and elective deferral account(s) for the plan year multiplied by a
fraction, the numerator of which is such participant's excess aggregate
contributions for the year and the denominator is the participant's
account balance(s) attributable to contribution percentage amounts without
regard to any income or loss occurring during such plan year; and
(ii) effective for plan years beginning on or after
January 1, 2006, and to the extent the excess contributions are
or will be credited with gain or loss as of an accounting date within the
gap period (i.e., the period after the close of the plan year and prior to
the distribution), 10% of the amount determined under (i) multiplied by
the number of whole calendar months between the end of the plan year and
the date of distribution, counting the month of distribution if
distribution occurs after the 15th of such
month.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
46
|
Weis
Markets, Inc. Retirement Savings Plan
|
(B)
|
Forfeitures of Excess Aggregate
Contributions – Forfeitures of excess aggregate matching
contributions may either be reallocated to the accounts of non-highly
compensated employees or applied to reduce employer contributions, as
provided in Section 3.6(e).
|
|
(C)
|
Accounting for Excess Aggregate
Contributions – Excess aggregate contributions allocated to a
participant shall be forfeited, if forfeitable or distributed on a
pro-rata basis from the participant's employee nondeductible contribution
account and employer matching contribution account (and, if applicable,
the participant's qualified nonelective contribution account or elective
deferral account(s), or both).
|
|
(D)
|
Excess Aggregate
Contributions shall mean, with respect to any plan year, the excess
of: (i) The aggregate contribution percentage amounts
taken into account in computing the numerator of the contribution
percentage actually made on behalf of highly compensated employees for
such plan year, over (ii) The maximum contribution percentage amounts
permitted by the ACP test (determined by hypothetically reducing
contributions made on behalf of highly compensated employees in order of
their contribution percentages beginning with the highest of such
percentages).
|
Such
determination shall be made after first determining excess elective deferrals
pursuant to Section 5.5(a) and then determining excess contributions
pursuant to Section 5.5(b)(2).
|
(3)
|
Required Forfeitures –
Any employer matching contribution attributable to an excess elective
deferral determined pursuant to Section 5.5(a) or an excess
contribution determined pursuant to Section 5.5(b)(2) shall be
forfeited. Any nonvested excess aggregate contribution
determined pursuant to Section 5.5(c)(2) shall also be
forfeited.
|
(d)
|
Top-Heavy
Requirements
|
Elective
deferrals (and for plan years beginning before January 1, 2002
employer matching contributions) will not be taken into account for the purpose
of satisfying the minimum top-heavy contribution
requirement. However, qualified nonelective contributions and
employer matching contributions (for plan years beginning on or after
January 1, 2002) may be taken into account for this purpose as
provided in Section 3.2(c) or 3.3(b), as appropriate.
(e)
|
Restrictions on Payment of
Certain Accounts
|
Elective
deferrals, qualified nonelective contributions, and qualified matching
contributions, and income allocable to each are not distributable to a
participant or his beneficiary in accordance with such person's election,
earlier than upon the participant's severance from employment (separation from
service for plan years beginning before 2002), death, or
disability. All distributions that may be made pursuant to one or
more of the distributable events described in this Section 5.5(e) are
subject to the spousal and participant consent requirements as described in
Section 5.2(a).
|
(1)
|
Such
account balances may also be distributed
upon:
|
|
(A)
|
Termination
of the plan without the employer maintaining or establishing another
defined contribution plan (other than an employee stock ownership plan (as
defined in Code section 4975(e)(7) or 409), a simplified
employee pension plan (as defined in Code section 408(k)), a SIMPLE
IRA plan (as defined in Code section 408(p)), a plan or contract
described in Code section 403(b) or a plan described in Code
section 457(b) or (f)) at any time during the period beginning
on the date of plan termination and ending 12 months after all assets
have been distributed from the plan. Such a distribution must
be made in a lump sum or through the purchase of an annuity contract that
shall be owned by the participant (if an annuity payment option is
otherwise available under
Section 4.3(b)).
|
|
(B)
|
The
attainment of age 59½ in the case of a profit sharing
plan.
|
|
(C)
|
The
hardship of the participant as described in
Section 4.4(a).
|
|
(2)
|
For
plan years beginning before 2002, such account balances could also be
distributed upon:
|
|
(A)
|
The
disposition by a corporation to an unrelated corporation of substantially
all of the assets (within the meaning of Code section 409(d)(2)) used
in a trade or business of such corporation if such corporation continues
to maintain this plan after the disposition, but only with respect to
employees who continue employment with the corporation acquiring such
assets. Such a distribution must be made in a lump
sum.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
|
47
|
Weis
Markets, Inc. Retirement Savings Plan
|
(B)
|
The
disposition by a corporation to an unrelated entity of such corporation's
interest in a subsidiary (within the meaning of Code
section 409(d)(3)) if such corporation continues to maintain this
plan, but only with respect to employees who continue employment with such
subsidiary. Such a distribution must be made in a lump
sum.
|
|
(f)
|
Safe Harbor Alternative
Compliance
|
|
(1)
|
If
the plan so provides in Section 3.4(a) or Section 3.6 that the
safe harbor requirements will be met, the provisions of this
Section 5.5(f) shall apply for the plan year as provided in such
Sections and any provisions relating to the ADP test described in
Section 5.5(b) or the ACP test described in Section 5.5(c) shall
not apply. To the extent that any other provision of the plan
is inconsistent with the provisions of this Section 5.5(f), the
provisions of this Section 5.5(f) shall govern when
Section 3.4(a) or Section 3.6 so
provide.
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(2)
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ADP Test Safe Harbor
Contributions – The plan may provide in Section 3.4(a) that
the ADP test safe harbor requirements shall be satisfied by the employer
making a safe harbor employer matching contribution as provided under
Section 3.6 (or as a separate safe harbor employer matching
contribution as provided under Section 3.6A) or by the employer
making a safe harbor nonelective contribution under Section 3.3 of at
least 3% of the employee's compensation or under another defined
contribution plan sponsored by the employer. In any case, the
notice described in Section 5.5(f)(4) shall be given. The
participant's accrued benefit derived from ADP test safe harbor
contributions shall be nonforfeitable and may not be distributed earlier
than provided in Section 5.5(e), regardless of the form of the
contribution.
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(3)
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ACP Test Safe Harbor
Requirements – The plan may provide in Section 3.6 that the
ACP test safe harbor requirements shall be satisfied by the employer
making a safe harbor nonelective contribution under Section 3.3 of at
least 3% of the employee's compensation or by the employer making a
matching contribution on behalf of each eligible employee that
either:
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|
(A)
|
is
equal to 100% of the elective contributions of the employee to the extent
such elective contributions do not exceed 3% of the employee's
compensation, plus 50% of the elective contributions of the employee to
the extent that such elective contributions exceed 3% but do not exceed 5%
of the employee's compensation; or
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|
(B)
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does
not increase as an employee's rate of elective contributions increase and
the aggregate amount of which shall be at least equal to the aggregate
amount of matching contributions which would be made if matching
contributions were made on the basis of the percentages described in
Section 5.5(f)(3)(A).
|
In either
case, the notice described in Section 5.5(f)(4) shall be given and matching
contributions on behalf of any employee shall not be made with respect to an
employee's nondeductible contributions or elective deferrals in excess of 6% of
the employee's compensation. The rate of an employer's matching
contribution shall not increase as the rate of an employee's nondeductible
contributions or elective deferrals increase nor shall the matching contribution
with respect to any highly compensated employee be greater than that with
respect to an employee who is not a highly compensated employee.
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(4)
|
Safe Harbor Notice – If
the employer elects to satisfy the safe harbor requirements of this
Section 5.5(f), the plan administrator shall provide to each employee
eligible to participate in the plan, no less than 30 days and no more
than 90 days prior to any plan year (or his entry date in the case of
a new participant), written notice of the employee's rights and
obligations under the plan that is sufficiently accurate and comprehensive
to apprise the employee of such rights and obligations. If an
employee becomes eligible to participate after the 90th day before the
beginning of the plan year and does not receive the notice for that
reason, the notice must be provided no more than 90 days before the
employee becomes eligible but not later than the date the employee becomes
eligible.
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Copyright © 2006 by
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Actuaries
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(A)
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Contents of the Notice –
Such notice shall be written in a manner calculated to be understood by
the average employee eligible to participate hereunder. The
notice shall accurately describe: (i) the safe harbor
matching or nonelective contribution formula used under the plan
(including a description of the levels of matching contributions, if any,
available under the plan); (ii) any other contributions under the
plan (including the potential for discretionary matching contributions)
and the conditions under which such contributions are made; (iii) the
plan to which safe harbor contributions will be made if such contributions
will be made to another plan; (iv) the type and amount of
compensation that may be deferred under the plan; (v) how to make
cash or deferred elections, including any administrative requirements that
apply to such elections; (vi) the periods available under the plan
for making cash or deferred elections; and (vii) withdrawal and
vesting provisions applicable to contributions under the
plan. If eligible employees have been provided with the current
summary plan description, the written notice may instead cross-reference
the relevant portion with respect to items (ii), (iii),
and (iv); however, such notice must also provide the telephone
numbers, addresses and, if applicable, electronic addresses, of the
individuals or offices from whom employees can obtain additional
information about the plan.
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(B)
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Alternative Timing of Amendment
and Notice for Safe Harbor Nonelective Contribution – If the
employer determines that it may choose during a plan year to satisfy the
ADP test safe harbor requirements by providing a safe harbor nonelective
contribution, the plan administrator shall provide a written notice to
eligible employees before the beginning of the plan year that (i) the
plan may be amended during the plan year to provide that the employer will
make a safe harbor nonelective contribution of at least 3% to the plan for
the plan year and (ii) if the plan is so amended, a supplemental
notice will be given to eligible employees 30 days prior to the last
day of the plan year informing them of such an amendment. If
the employer elects during the plan year to satisfy the ADP test safe
harbor requirements by providing a safe harbor nonelective contribution,
the amendment shall be adopted not later than 30 days before the last
day of the plan year. The supplemental notice shall be
distributed no later than 30 days prior to the last day of the plan
year and shall state that a 3% safe harbor nonelective contribution will
be made for the plan year.
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ARTICLE
VI – ADMINISTRATION OF THE PLAN
Section
6.1 – Fiduciary Responsibility
(a)
|
Fiduciary Standards – A
fiduciary shall discharge his duties with respect to a plan solely in the
interest of the participants and beneficiaries and
–
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For the
exclusive purpose of providing benefits to participants and their beneficiaries
and defraying reasonable expenses of administering the plan;
With the
care, skill, prudence, and diligence under the circumstances then prevailing
that a prudent man acting in a like capacity and familiar with such matters
would use in the conduct of an enterprise of a like character and with like
aims;
By
diversifying the investments of the plan so as to minimize the risk of large
losses, unless under the circumstances it is clearly prudent not to do so;
and
In
accordance with the documents and instruments governing the plan insofar as such
documents and instruments are consistent with the provisions of
ERISA.
(b)
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Allocation of Fiduciary
Responsibility
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(1)
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It
is intended to allocate to each fiduciary, either named or otherwise, the
individual responsibility for the prudent execution of the functions
assigned to him. None of the allocated responsibilities or any
other responsibilities shall be shared by two or more fiduciaries unless
specifically provided for in the
plan.
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(2)
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When
one fiduciary is required to follow the directions of another fiduciary,
the two fiduciaries shall not be deemed to share such
responsibility. Instead, the responsibility of the fiduciary
giving the directions shall be deemed to be his sole responsibility and
the responsibility of the fiduciary receiving directions shall be to
follow those directions insofar as such instructions on their face are
proper under applicable law.
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(3)
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Any
person or group of persons may serve in more than one fiduciary capacity
with respect to this plan.
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Copyright © 2006 by
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Actuaries
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Markets, Inc. Retirement Savings Plan
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(4)
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A
fiduciary under this plan may employ one or more persons, including
independent accountants, attorneys and actuaries to render advice with
regard to any responsibility such fiduciary has under the
plan.
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(c)
|
Indemnification by
Employer – Unless resulting from the gross negligence, willful
misconduct or lack of good faith on the part of a fiduciary who is an
officer or employee of the employer, the employer shall indemnify and save
harmless such fiduciary from, against, for and in respect of any and all
damages, losses, obligations, liabilities, liens, deficiencies, costs and
expenses, including without limitation, reasonable attorney's fees and
other costs and expenses incident to any suit, action, investigation,
claim or proceedings suffered in connection with his acting as a fiduciary
under the plan.
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(d)
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Named Fiduciary – The
person or persons named by the employer as having fiduciary responsibility
for the management and control of plan assets shall be known as the “named
fiduciary” hereunder. Such responsibility shall include the
appointment of the plan administrator (Section 6.2(a)) and the
investment manager (Section 6.4(b)) and the deciding of benefit
appeals (Section 6.3). The employer shall retain the
authority to appoint the trustee
(Section 6.4(a)).
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Section
6.2 – Plan Administrator
(a)
|
Appointment of Plan
Administrator
|
The named
fiduciary shall appoint a plan administrator who may be a person or an
administrative committee consisting of no more than five
members. Vacancies occurring upon resignation or removal of a plan
administrator or a committee member shall be filled promptly by the named
fiduciary. Any plan administrator may resign at any time by giving
notice of his resignation to the named fiduciary, and any plan administrator may
be removed at any time by the named fiduciary. The named fiduciary
shall review at regular intervals the performance of the plan administrator(s)
and shall re-evaluate the appointment of such administrator(s). After
the named fiduciary has appointed the plan administrator and has received a
written notice of acceptance, the fiduciary responsibility for administration of
the plan shall be the responsibility of the plan administrator or plan
administrative committee.
(b)
|
Duties and Powers of Plan
Administrator
|
The plan
administrator shall have the following duties and discretionary powers and such
other duties and discretionary powers as relate to the administration of the
plan:
|
(1)
|
To
determine in a nondiscriminatory manner all questions relating to the
eligibility of employees to become
participants.
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|
(2)
|
To
determine in a nondiscriminatory manner eligibility for benefits and to
determine and certify the amount and kind of benefits payable to
participants.
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(3)
|
To
authorize all disbursements from the
fund.
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(4)
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To
appoint or employ any independent person to perform necessary plan
functions and to assist in the fulfillment of administrative
responsibilities as he deems advisable, including the retention of a third
party administrator, custodian, auditor, accountant, actuary, or
attorney.
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|
(5)
|
When
appropriate, to select an insurance company and annuity contracts that, in
his opinion, will best carry out the purposes of the
plan.
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(6)
|
To
construe and interpret any ambiguities in the plan and to make, publish,
interpret, alter, amend or revoke rules for the regulation of the plan
that are consistent with the terms of the plan and with
ERISA.
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(7)
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To
prepare and distribute, in such manner as determined to be appropriate,
information explaining the plan.
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(c)
|
Allocation of Fiduciary
Responsibility Within Plan Administrative
Committee
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If the
plan administrator is a plan administrative committee, the committee shall
choose from its members a chairperson and a secretary. The committee
may allocate responsibility for those duties and powers listed in
Section 6.2(b)(1) and (2) (except determination of qualification for
disability retirement) and other purely ministerial duties to one or more
members of the committee. The committee shall review at regular
intervals the performance of any committee member to whom fiduciary
responsibility has been allocated and shall re-evaluate such allocation of
responsibility. After the plan administrative committee has made such
allocations of responsibilities and has received written notice of acceptance,
the fiduciary responsibilities for such administrative duties and powers shall
then be considered as the responsibilities of such committee
member(s).
Copyright © 2006 by
Conrad Siegel
Actuaries
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Markets, Inc. Retirement Savings Plan
(d)
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Miscellaneous
Provisions
|
|
(1)
|
Plan Administrative Committee
Actions – The actions of such committee shall be determined by the
vote or other affirmative expression of a majority of its
members. Either the chairperson or the secretary may execute
any certificate or other written direction on behalf of the
committee. A member of the committee who is a participant shall
not vote on any question relating specifically to himself. If
the remaining members of the committee, by majority vote thereof, are
unable to come to a determination of any such question, the named
fiduciary shall appoint a substitute member who shall act as a member of
the committee for the special vote.
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(2)
|
Expenses – The plan
administrator shall serve without compensation for service as
such. All reasonable expenses of the plan administrator shall
be paid by the employer or from the
fund.
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(3)
|
Examination of Records –
The plan administrator shall make available to any participant for
examination during business hours such of the plan records as pertain only
to the participant involved.
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(4)
|
Information to the Plan
Administrator – To enable the plan administrator to perform the
administrative functions, the employer shall supply full and timely
information to the plan administrator on all participants as the plan
administrator may require.
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Section
6.3 – Claims Procedure
(a)
|
Notification of Claim
Determination – The plan administrator shall notify each
participant in writing of his determination of benefits. If the
plan administrator denies any benefit, such written denial shall
include:
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|
·
|
The
specific reasons for denial;
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|
·
|
Reference
to provisions on which the denial is
based;
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|
·
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A
description of and reason for any additional information needed to process
the claim; and
|
|
·
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A
description of the Plan’s review procedures and the time limits applicable
to such procedures, including a statement of the claimant’s right to bring
a civil action under ERISA section 502(a) following an adverse
benefit determination on review.
|
If a
claim is wholly or partially denied, the plan administrator shall notify the
claimant of the plan's adverse benefit determination within a reasonable period
of time, but not later than 90 days after receipt of the claim by the plan,
unless the plan administrator determines that special circumstances require an
extension of time for processing the claim. If the plan administrator
determines that an extension of time for processing is required, written notice
of the extension shall be furnished to the claimant prior to the termination of
the initial 90-day period. In no event shall such extension exceed a
period of 90 days from the end of such initial period. The
extension notice shall indicate the special circumstances requiring an extension
of time and the date by which the plan expects to render the benefit
determination.
(b)
|
Appeal – The participant
or his duly authorized representative
may:
|
|
·
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Make
a written request for a review of the participant's case by the named
fiduciary;
|
|
·
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Review
upon request and free of charge, have reasonable access to, and have
copies of, all documents, records, and other information relevant to the
claimant's claim for benefits;
|
|
·
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Submit
written issues, comments, documents, records, and other information
relating to the claim for benefits, without regard to whether such
information was submitted or considered in the initial benefit
determination.
|
The
written request for review must be submitted no later than 60 days after
receiving written notification of denial of benefits. A document,
record, or other information shall be considered relevant to a claimant's claim
if such document, record, or other information:
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·
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Was
relied upon in making the benefit
determination;
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|
·
|
Was
submitted, considered, or generated in the course of making the benefit
determination, without regard to whether such document, record, or other
information was relied upon in making the benefit determination;
or
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Copyright © 2006 by
Conrad Siegel
Actuaries
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51
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Markets, Inc. Retirement Savings Plan
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·
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Demonstrates
compliance with the administrative processes and safeguards required by
law in making the benefit
determination.
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(c)
|
Appeal
Procedure
|
|
(1)
|
Except
as provided in Section 6.3(c)(2), the named fiduciary must render a
decision no later than 60 days after receiving the written request
for review, unless circumstances make it impossible to do so; but in no
event shall the decision be rendered later than 120 days after the
request for review is received. If the named fiduciary
determines that an extension of time for processing is required, written
notice of the extension shall be furnished to the claimant by the plan
administrator prior to the termination of the initial 60-day
period. The extension notice shall indicate the special
circumstances requiring an extension of time and the date by which the
plan expects to render the determination on
review.
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(2)
|
If
the named fiduciary is a committee or board of trustees that holds
regularly scheduled meetings at least quarterly, Section 6.3(c)(1)
shall not apply. The named fiduciary shall instead make a
benefit determination no later than the date of the meeting of the
committee or board that immediately follows the plan's receipt of a
request for review, unless the request for review is filed within
30 days preceding the date of such meeting. In such case,
a benefit determination may be made by no later than the date of the
second meeting following the plan's receipt of the request for
review. If special circumstances require a further extension of
time for processing, a benefit determination shall be rendered not later
than the third meeting of the committee or board following the plan's
receipt of the request for review. If such an extension of time
for review is required because of special circumstances, the plan
administrator shall provide the claimant with written notice of the
extension, describing the special circumstances and the date as of which
the benefit determination will be made, prior to the commencement of the
extension. The plan administrator shall notify the claimant of
the benefit determination as soon as possible, but not later than
5 days after the benefit determination is
made.
|
|
(3)
|
The
review shall take into account all comments, documents, records, and other
information submitted by the claimant relating to the claim, without
regard to whether such information was submitted or considered in the
initial benefit determination. If the claim is denied upon
review, the written notice of denial shall include the items listed in
Section 6.3(a) and the statement required by Regulation
section 2560.503-1(j)(5)(iii) regarding the possible availability of
alternative dispute resolution
options.
|
(d)
|
Limitation on Time Period for
Litigation of a Benefit Claim – Following receipt of the written
rendering of the named fiduciary's decision under Section 6.3(c), the
participant shall have 365 days in which to file suit in the
appropriate court. Thereafter, the right to contest the
decision shall be waived.
|
Section
6.4 – Trust Fund
(a)
|
Appointment of
Trustee
|
The
employer shall appoint a trustee for the proper care and custody of all funds,
securities and other properties in the trust, and for investment of plan assets
(or for execution of such orders as it receives from an investment manager
appointed for investment of plan assets). The duties and powers of
the trustee shall be set forth in a trust agreement executed by the employer,
which is incorporated herein by reference. The named fiduciary shall
review at regular intervals the performance of the trustee and shall re-evaluate
the appointment of such trustee. After the employer has appointed the
trustee and the named fiduciary has received a written notice of acceptance of
its responsibility, the fiduciary responsibility with respect to the proper care
and custody of plan assets shall be considered as the responsibility of the
trustee. Unless otherwise allocated to an investment manager, the
fiduciary responsibility with respect to investment of plan assets shall
likewise be considered as the responsibility of the trustee.
(b)
|
Appointment of Investment
Manager
|
The named
fiduciary may appoint an investment manager who is other than the trustee, which
investment manager may be a bank or an investment advisor registered with the
Securities and Exchange Commission under the Investment Advisors Act of
1940. Such investment manager, if appointed, shall have sole
discretion in the investment of plan assets, subject to the funding
policy. The named fiduciary shall review at regular intervals no less
frequently than annually, the performance of such investment manager and shall
re-evaluate the appointment of such investment manager. After the
named fiduciary has appointed an investment manager and has received a written
notice of acceptance of its responsibility, the fiduciary responsibility with
respect to investment of plan assets shall be considered as the responsibility
of the investment manager.
Copyright © 2006 by
Conrad Siegel
Actuaries
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52
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Markets, Inc. Retirement Savings Plan
(c)
|
Funding
Policy
|
The named
fiduciary shall determine and communicate in writing to the fiduciary
responsible for investment of plan assets the funding policy for the
plan. The funding policy shall set forth the plan's short-range and
long-range financial needs, so that said fiduciary may coordinate the investment
of plan assets with the plan's financial needs.
(d)
|
Valuation of the
Fund
|
The fund
shall be valued by the trustee on the first day of each plan year and as of any
interim allocation date determined by the plan administrator. The
valuation shall be made on the basis of the current fair market value of all
property in the fund.
(e)
|
Expenses
|
The trust
fund shall pay the expenses incurred in the administration of the plan and the
investment of the fund, provided the cost is reasonable. Such
expenses shall include legal fees incurred by the plan administrator or the
trustee, provided such fiduciaries are not proven to have committed a prohibited
transaction. Generally, expenses shall be allocated against the
participant accounts on a pro rata basis.
ARTICLE
VII – AMENDMENT AND TERMINATION OF PLAN
Section
7.1 – Right to Discontinue and Amend
It is the
expectation of the employer that it will continue this plan indefinitely and
make the payments of its contributions hereunder, but the continuance of the
plan is not assumed as a contractual obligation of the employer and the right is
reserved by the employer, at any time, to reduce, suspend or discontinue its
contributions hereunder.
Section
7.2 – Amendments
Except as
herein limited, the employer shall have the right to amend this plan at any time
to any extent that it may deem advisable. Such amendment shall be
stated in writing. It shall be authorized by action of the board of
directors under the corporate by-laws if the employer is a corporation, by
action of the agreement of the partners as required under the partnership
agreement if the employer is a partnership, or by action of the sole proprietor
if the employer is a sole proprietorship. The authorization of an
employer's board of directors shall designate the person to execute the
amendment.
The
employer's right to amend the plan shall be limited as follows:
(a)
|
No
amendment shall increase the duties or liabilities of the plan
administrator, the trustee, or other fiduciary without their respective
written consent.
|
(b)
|
No
amendments shall have the effect of vesting in the employer any interest
in or control over any contracts issued pursuant hereto or any other
property in the fund.
|
(c)
|
No
amendment to the plan shall be effective to the extent that it has the
effect of decreasing a participant's accrued
benefit. Notwithstanding the preceding sentence, a
participant's account balance may be reduced to the extent permitted under
Code section 412(c)(8). For purposes of this paragraph, a
plan amendment that has the effect of decreasing a participant's account
balance, with respect to benefits attributable to service before the
amendment shall be treated as reducing an accrued
benefit. Furthermore, if the vesting schedule of a plan is
amended, in the case of an employee who is a participant as of the later
of the date such amendment is adopted or the date it becomes effective,
the nonforfeitable percentage (determined as of such date) of such
employee's right to his employer-derived accrued benefit will not be less
than his percentage computed under the plan without regard to such
amendment.
|
Copyright © 2006 by
Conrad Siegel
Actuaries
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53
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Weis
Markets, Inc. Retirement Savings Plan
(d)
|
No
amendment to the plan shall be effective to eliminate or restrict an
optional form of benefit. The preceding sentence shall not
apply to a plan amendment that eliminates or restricts the ability of a
participant to receive payment of his or her account balance under a
particular optional form of benefit if the amendment provides a single-sum
distribution form that is otherwise identical to the optional form of
benefit being eliminated or restricted. For this purpose, a
single-sum distribution form is otherwise identical only if the single-sum
distribution form is identical in all respects to the eliminated or
restricted optional form of benefit (or would be identical except that it
provides greater rights to the participant) except with respect to the
timing of payments after
commencement.
|
(e)
|
No
amendment to the vesting schedule adopted by the employer hereunder shall
deprive a participant of his vested portion of his employer contribution
accounts to the date of such amendment. If the plan's vesting
schedule is amended, or the plan is amended in any way that directly or
indirectly affects the computation of the participant's nonforfeitable
percentage or if the plan is deemed amended by an automatic change to or
from a top-heavy vesting schedule, each participant with at least
3 years of service with the employer may elect, within a reasonable
period after the adoption of the amendment or change, to have the
nonforfeitable percentage computed under the plan without regard to such
amendment or change. For participants who do not have at least
one hour of service in any plan year beginning after
December 31, 1988, "5 years of service" shall be
substituted for "3 years of service" in the preceding
sentence. The period during which the election may be made
shall commence with the date the amendment is adopted or deemed to be made
and shall end on the latest of:
|
|
(1)
|
60 days
after the amendment is adopted;
|
|
(2)
|
60 days
after the amendment becomes effective;
or
|
|
(3)
|
60 days
after the participant is issued written notice of the amendment by the
employer or plan administrator.
|
Section
7.3 – Protection of Benefits in Case of Plan Merger
In the
event of a merger or consolidation with, or transfer of assets or liabilities to
any other plan, each participant will receive a benefit immediately after such
merger, consolidation or transfer (if the plan then terminated) that is at least
equal to the benefit the participant was entitled to immediately before such
merger, consolidation or transfer (if the plan had terminated).
Section
7.4 – Termination of Plan
(a)
|
When Plan Terminates –
This plan shall terminate upon the happening of any of the following
events: legal adjudication of the employer as bankrupt; a
general assignment by the employer to or for the benefit of its creditors;
the legal dissolution of the employer; or termination of the plan by the
employer.
|
(b)
|
Allocation of Assets –
Upon termination, partial termination, or complete discontinuance of
employer contributions, the account balance(s) of each affected
participant who is an active participant or who is not an active
participant but has neither received a complete distribution of his vested
accrued benefit nor incurred five one-year breaks in service shall be 100%
vested and nonforfeitable. The amount of the fund assets shall
be allocated to each participant, subject to provisions for expenses of
administration of the liquidation, in the ratio that such participant's
account(s) bears to all accounts. If a participant under this
plan has terminated his employment at any time after the first day of the
plan year in which the employer made his final contribution to the plan,
and if any portion of any account of such terminated participant was
forfeited and reallocated to the remaining participants, such forfeiture
shall be reversed and the forfeited amount shall be credited to the
account of such terminated
participant.
|
ARTICLE
VIII – MISCELLANEOUS PROVISIONS
Section
8.1 – Exclusive Benefit – Non-Reversion
The plan
is created for the exclusive benefit of the employees of the employer and shall
be interpreted in a manner consistent with its being a qualified plan as defined
in section 401(a) of the Internal Revenue Code and with
ERISA. The corpus or income of the trust may not be diverted to or
used for other than the exclusive benefit of the participants or their
beneficiaries (except for defraying reasonable expenses of administering the
plan).
Notwithstanding
the above, a contribution paid by the employer to the trust may be repaid to the
employer under the following circumstances:
Copyright © 2006 by
Conrad Siegel
Actuaries
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54
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Markets, Inc. Retirement Savings Plan
(a)
|
Any
contribution made by the employer because of a mistake of fact must be
returned to the employer within one year of the
contribution.
|
(b)
|
In
the event the deduction of a contribution made by the employer is
disallowed under Code section 404, such contribution (to the extent
disallowed) must be returned to the employer within one year of the
disallowance of the deduction.
|
(c)
|
If
the Commissioner of Internal Revenue determines that the plan is not
initially qualified under the Internal Revenue Code, any contribution made
incident to that initial qualification by the employer must be returned to
the employer within one year after the date the initial qualification is
denied, but only if the application for the qualification is made by the
time prescribed by law for filing the employer's return for the taxable
year in which the plan is adopted, or such later date as the Secretary of
the Treasury may prescribe.
|
Section
8.2 – Inalienability of Benefits
No
benefit or interest available hereunder including any annuity contract
distributed herefrom shall be subject to assignment or alienation, either
voluntarily or involuntarily. The preceding sentence shall also apply
to the creation, assignment, or recognition of a right to any benefit payable
with respect to a participant pursuant to a domestic relations order, unless
such order is determined to be a qualified domestic relations order as defined
in Code section 414(p), or any domestic relations order entered before
January 1, 1985. A loan made to a participant and secured
by his nonforfeitable account balance(s) under Section 4.4(b) will not be
treated as an assignment or alienation and such securing account balance(s)
shall be subject to attachment by the plan in the event of default.
Notwithstanding
the preceding paragraph, effective with respect to judgments, orders, and
decrees issued, and settlement agreements entered into, on or after
August 5, 1997, a participant’s benefit (and that of his spouse) shall
be reduced to satisfy liabilities of the participant to the plan due to
(1) the participant being convicted of committing a crime involving the
plan, (2) a civil judgment (or consent order or decree) entered by a court
in an action brought in connection with a violation of the fiduciary provisions
of part 4 of subtitle B of Title I of ERISA, or (3) a
settlement agreement between the Secretary of Labor or the Pension Benefit
Guaranty Corporation and the participant in connection with a violation of such
fiduciary provisions of ERISA. No reduction shall be made pursuant to
this paragraph, unless the judgment, order, decree, or settlement agreement
shall expressly provide for the offset of all or part of the amount ordered or
required to be paid to the Plan against the participant’s benefits provided
under the Plan.
Section
8.3 – Employer-Employee Relationship
This plan
is not to be construed as creating or changing any contract of employment
between the employer and its employees, and the employer retains the right to
deal with its employees in the same manner as though this plan had not been
created.
Section
8.4 – Binding Agreement
This plan
shall be binding on the heirs, executors, administrators, successors and assigns
as such terms may be applicable to any or all parties hereto, and on any
participants, present or future.
Section
8.5 – Separability
If any
provision of this plan shall be held invalid or unenforceable, such invalidity
or unenforceability shall not affect any other provision hereof and this plan
shall be construed and enforced as if such provision had not been
included.
Section
8.6 – Construction
The plan
shall be construed in accordance with the laws of the state in which the
employer was incorporated (or is domiciled in the case of an unincorporated
employer) and with ERISA.
Section
8.7 – Copies of Plan
This plan
may be executed in any number of counterparts, each of which shall be deemed as
an original, and said counterparts shall constitute but one and the same
instrument that may be sufficiently evidenced by any one
counterpart.
Copyright © 2006 by
Conrad Siegel
Actuaries
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55
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Weis
Markets, Inc. Retirement Savings Plan
Section
8.8 – Interpretation
Wherever
appropriate, words used in this plan in the singular may include the plural or
the plural may be read as singular, and the masculine may include the
feminine.
Copyright © 2006 by
Conrad Siegel
Actuaries
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56
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2007
COMPLIANCE AMENDMENT
TO
THE
WEIS
MARKETS, INC. RETIREMENT SAVINGS PLAN
As
authorized by Section 7.2 of the Weis Markets, Inc. Retirement Savings Plan
("Plan") as amended and restated effective January 1, 2009, the
employer, Weis Markets, Inc., hereby amends the Plan to comply with certain law
and regulatory changes effective as of the 2007 plan year not otherwise
incorporated into the Plan. This amendment shall supersede the
provisions of the Plan to the extent those provisions are inconsistent with the
provisions of this amendment.
The
employer hereby amends the Plan in the following manner:
FIRST:
Limitations on Allocations – Compliance with Final Regulations
Effective
for limitation years beginning on or after July 1, 2007,
Section 5.1 is amended to comply with the final regulations issued under
Code section 415. Section 5.1(a) and (b) are amended to
remove the provisions governing the correction of an excess amount and replace
them with provisions limiting contributions that would otherwise be in excess of
the annual addition limitations. Further, Section 5.1(a) is
amended to provide that certain corrective allocations are not an annual
addition. As amended, Section 5.1(a)(4) shall read as
follows:
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(4)
|
If
a participant elects to make employee nondeductible contributions or
elective deferrals that together with any contribution the employer is
obligated to make under the terms of this plan (including pursuant to any
published discretionary contribution) would otherwise cause the annual
additions for the limitation year to exceed the maximum permissible
amount, the contribution election of the participant shall be limited
before any employer contribution is reduced so that the annual additions
for the limitation year will equal the maximum permissible
amount.
|
Section 5.1(b)(6)
shall be deleted and Section 5.1(b)(5) shall read as follow:
|
(5)
|
If
an allocation date of this plan coincides with an allocation date of
another plan and the employee or employer contribution that would
otherwise be contributed or allocated to a participant's account under the
plans would cause the annual additions for the limitation year to exceed
the maximum permissible amount, Section 3.1(c) shall control which
contribution or allocation will be reduced so that the annual additions
for the limitation year will equal the maximum permissible
amount.
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Section 5.1(c)(1)
definition of annual addition shall contain a new paragraph that shall read as
follows:
Restorative
payments allocated to a participant’s account including restorative payments
made pursuant to Section 4.2(b)(2)(B) and payments made to restore losses
to the plan resulting from actions (or a failure to act) by a fiduciary for
which there is a reasonable risk of liability under ERISA or under other
applicable federal or state law (where similarly situated participants are
treated similarly) shall not give rise to an annual addition for any limitation
year.
A
corresponding amendment shall be made to Section 3.1(c) so that it shall be
replaced with the following:
(c)
|
Limitations and
Conditions – Notwithstanding the allocation procedures set forth in
this Article, the allocations otherwise contributable to participants'
accounts under this plan shall be limited or reduced as provided in
Section 5.1.
|
SECOND:
Excess Deferrals
Section 5.5(a)(6)
is amended to comply with Regulation section 1.402(g)-1(e)(5) to include
gap period interest when distributing an excess elective deferral. As
amended, Section 5.5(a)(6) shall read as follows:
1
|
(6)
|
Determination of Income or
Loss
|
Excess
elective deferrals shall be adjusted for any income or loss. The
income or loss allocable to excess elective deferrals allocated to each
participant is the sum of: (i) the income or loss allocable to
the participant's elective deferral account(s) for the taxable year multiplied
by a fraction, the numerator of which is such participant's excess elective
deferrals for the year and the denominator is the participant's account balance
attributable to elective deferrals without regard to any income or loss
occurring during such taxable year; and (ii) effective for taxable years
beginning on or after January 1, 2007, and to the extent the excess
elective deferrals are or will be credited with gain or loss as of an accounting
date within the gap period (i.e., the period after the close of the taxable year
and prior to the distribution), 10% of the amount determined under (i)
multiplied by the number of whole calendar months between the end of the taxable
year and the date of distribution, counting the month of distribution if
distribution occurs after the 15th of such month.
THIRD:
Limitations and Conditions Under Code Sections 401(k) and 401(m)
Effective
for limitation years beginning on or after July 1, 2007,
Section 5.5(b)(1)(B) and 5.5(c)(1)(B)(iv) are amended to remove the
provisions referencing the exclusion of distributed amounts that were
distributed as amounts in excess of the Code section 415 annual addition
limitations. As amended, the final sentence of
Section 5.5(b)(1)(B) and the final sentence of 5.5(c)(1)(B)(iv) are each
deleted.
FOURTH:
Effective Date
These
amendments are effective as of January 1, 2007, except as otherwise
provided herein.
FIFTH:
Remaining Plan Provisions
All other
provisions of the Plan remain in full force and effect.
2
2009
PPA COMPLIANCE AMENDMENT
TO
THE
WEIS
MARKETS, INC. RETIREMENT SAVINGS PLAN
As
authorized by Section 7.2 of the Weis Markets, Inc. Retirement Savings Plan
("Plan") as amended and restated effective January 1, 2009, the
employer, Weis Markets, Inc., hereby amends the Plan to comply with the Pension
Protection Act of 2006 (PPA) and other law and regulatory changes effective as
of or prior to the 2009 plan year and now required to be incorporated into the
Plan. This amendment shall supersede the provisions of the Plan to
the extent those provisions are inconsistent with the provisions of this
amendment. The employer hereby amends the Plan in the following
manner:
FIRST:
Employer
Section 1.5
is amended to comply with Revenue Ruling 2008-45 prohibiting the transfer
of the plan sponsorship to an unrelated taxpayer where there is no related
transfer of business assets or operations. As amended,
Section 1.5 shall contain an additional subsection (c) that shall read
as follows:
(c)
|
Exclusive Benefit – In
compliance with the exclusive benefit requirements of Code
section 401(a), the sponsorship of this plan may not be transferred
to an unrelated entity if the transfer is not in connection with a
transfer of business assets or operations from the employer to such
entity.
|
SECOND:
USERRA Break in Service
Section 1.10
is amended to comply with the Heroes Earnings Assistance and Relief Tax Act of
2008 (HEART) with respect to deaths occurring on or after
January 1, 2007. As amended, a second paragraph is added to
Section 1.10(e) that shall read as follows:
Effective
with respect to deaths occurring on or after January 1, 2007, in the
case of a participant who dies while performing qualified military service, the
beneficiary(ies) of the participant shall be entitled to any benefits payable
under Section 4.2(a)(5) that would have been payable had the participant
resumed and then terminated employment on account of death.
THIRD:
Investment Election
Section 3.8(b)
is amended to provide that the Plan is intended to satisfy the requirements
under ERISA section 404(c)(5) for a qualified default investment
alternative with respect to any automatic contribution and any other account for
which a participant fails to make an investment election. As amended,
Section 3.8(b) shall contain an additional paragraph that shall read as
follows:
If a
participant fails to make any investment election prior to an allocation to his
account(s), the trustee shall invest his account(s) in a qualified default
investment alternative selected for the purpose that complies with the
regulations prescribed by the Secretary of Labor under ERISA
section 404(c)(5) until such time as the participant makes an affirmative
investment election.
FOURTH:
Inherited IRAs and Rollovers to Roth IRAs
Effective
for distributions on or after January 1, 2007, Section 4.3(d)(2)
and (3) are amended to permit a nonspouse beneficiary receiving a lump sum death
benefit to direct its transfer to an inherited individual retirement
account. Effective for distributions on or after
January 1, 2008, Section 4.3(d)(2) is amended to permit a
rollover or transfer to a Roth individual retirement account. As
amended, Section 4.3(d)(2) shall read as follows:
|
(2)
|
Eligible Retirement Plan
– An eligible retirement plan is an individual retirement account
described in Code section 408(a), an individual retirement annuity
described in Code section 408(b), an annuity plan described in Code
section 403(a), or a qualified plan described in Code
section 401(a), that accepts the distributee's eligible rollover
distribution. Effective for distributions made on or after
January 1, 2002, an eligible retirement plan shall also mean an
annuity contract described in Code section 403(b) or an eligible plan
under Code section 457(b) that is maintained by a state, political
subdivision of a state, or any agency or instrumentality of a state or
political subdivision of a state and that agrees to separately account for
amounts transferred into such plan from this
plan.
|
1
If any
portion of an eligible rollover distribution is attributable to payments or
distributions from a designated Roth account, an eligible retirement plan with
respect to such portion shall include only a designated Roth account in a
qualified defined contribution plan described in Code section 401(a) or a
Roth IRA as defined in Code section 402A(c)(3)(A).
Effective
for distributions made on or after January 1, 2008, an eligible
retirement plan includes a Roth individual retirement account (Roth IRA)
described in Code section 408A. However, for distributions
before January 1, 2010, a distributee shall not be allowed to make a
qualified rollover contribution to a Roth IRA from an account other than a
designated Roth account if, for the taxable year of the distribution to which
such contribution relates the distributee's adjusted gross income exceeds
$100,000, or the distributee is a married individual filing a separate
return.
As
amended, Section 4.3(d)(3) shall read as follows:
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(3)
|
Distributee – A
distributee includes an employee or former employee. In
addition, the employee's or former employee's surviving spouse and the
employee's or former employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as defined in
Code section 414(p), are distributees with regard to the interest of
the spouse or former spouse. Effective for death benefit
distributions made on or after January 1, 2007, a distributee
shall include a nonspouse beneficiary but only with respect to a direct
transfer to an inherited individual retirement account or annuity that is
established on his behalf and that will be treated as an inherited
individual retirement account or annuity pursuant to the provisions of
Code section 402(c)(11).
|
FIFTH:
Distribution Written Explanation and Code Section 402(f) Notice
Period
Effective
for notices issued on or after January 1, 2007, Section 4.3(e) is
amended to reflect that the notice must include a description of the
consequences of failing to defer receipt of a distribution in compliance with
the changes made by PPA. Effective for annuity starting dates
occurring on or after January 1, 2007, Section 4.3(e) is also
amended to permit the Code section 402(f) and section 411(a)(11)
notice requirements to be met as much as 180 days prior to the annuity
starting date. As amended, the first paragraph of Section 4.3(e)
shall read as follows:
(e)
|
Payment Election
Procedures
|
As
described in Section 5.2(a), an account balance in excess of $5,000 shall not be
immediately distributed without the consent of the participant. The
participant shall receive the notice required under Regulation
section 1.411(a)-11(c) no less than 30 days and no more than
180 days before the annuity starting date with respect to the
distribution. Effective for notices issued on or after
January 1, 2007, the written explanation shall include a description
of the consequences of failing to defer receipt of the
distribution. Effective for distributions made on or after
January 1, 1993, for any distribution in excess of $200, the plan
administrator shall give the participant notice of his eligible rollover
distribution rights. The participant shall receive such notice in the
same time period as the 411 notice is required to be
provided. Effective for distributions made on or after
January 1, 1994, if a distribution is one to which Code
sections 401(a)(11) and 417 do not apply, such distribution may
commence less than 30 days after the 411 notice is given, provided
that:
* *
*
SIXTH:
Hardship Withdrawals for Beneficiary
Effective
for plan years beginning after December 31, 2006, Section 4.4(a)
is amended to permit a participant to receive a hardship withdrawal due to an
event that constitutes a hardship occurring with respect to a person who the
participant has designated as his primary beneficiary under the
Plan. As amended, the amended portion of Section 4.4(a) shall
read as follows:
2
An
immediate and heavy financial need shall be deemed to exist if the distribution
is requested for one of the following reasons: (1) expenses
incurred or necessary for medical care described in Code section 213(d) of
the employee, the employee's spouse, children, dependents, or
beneficiary(ies); (2) the purchase (excluding mortgage payments)
of a principal residence for the employee; (3) payment of tuition and
related educational fees for the next twelve months of post-secondary education
for the employee, the employee's spouse, children, dependents, or
beneficiary(ies); (4) payments necessary to prevent the eviction of the
employee from, or a foreclosure on the mortgage of, the employee's principal
residence; (5) payments for funeral or burial expenses for the employee's
deceased parent, spouse, child, dependent, or beneficiary; or (6) expenses
incurred to repair damage to the employee's principal residence that would
qualify for a casualty loss deduction under Code section 165 (determined
without regard to whether the loss exceeds 10% of adjusted gross
income). The latter two reasons (funeral expenses and home repair)
shall only apply to plan years beginning after
December 31, 2005. Immediate and heavy financial need for
the participant's beneficiary shall only apply to plan years beginning after
December 31, 2006. For this purpose beneficiary shall mean
the individual(s) designated by the participant as his primary beneficiary on
his most recent beneficiary designation.
SEVENTH:
Definitions (Code Section 415 Limitations) – Compensation
Effective
for limitation years beginning on or after July 1, 2007,
Section 5.1(c)(2) is amended to comply with the final regulations issued
under Code section 415 with respect to the definition of compensation where
there is severance compensation following a termination of
employment. As amended, Section 5.1(c)(2) shall read as
follows:
|
(2)
|
Compensation – A
participant's earned income and any earnings reportable as W-2 wages
for federal income tax withholding purposes that are paid by the
employer. W-2 wages means wages as defined in Code
section 3401(a) but determined without regard to any rules that limit
the remuneration included in wages based on the nature or location of the
employment or the services performed (such as the exception for
agricultural labor in Code
section 3401(a)(2)).
|
For
purposes of applying the limitations of this Section 5.1, compensation for
a limitation year is the compensation actually paid or includable in gross
income during such limitation year.
Compensation
in excess of the limitations of Section 1.2(c) shall not be taken into
account. In order to be taken into account for a limitation year,
compensation must be paid or treated as paid prior to severance from employment
with the employer. Effective for limitation years beginning on or
after July 1, 2007, an includable payment shall be treated as paid
prior to severance from employment if it is paid by the later of 2½ months
after severance or the last day of the limitation year that includes the
severance date. For this purpose, includable payments are those that
absent the severance would have been paid and are regular compensation for
services during regular working hours or outside working hours (such as overtime
or shift differentials), commissions, bonuses, or other similar
compensation. Includable payments shall also include accrued sick,
vacation, or other leave if such payments would have been included in
compensation as defined in Section 1.2 if they were paid prior to the
employee's severance from employment.
Compensation
shall include elective contributions as defined in Section 1.2(a) and
elective contributions under a Code section 501(c)(18)
plan. Elective contribution amounts under a cafeteria plan excludable
under Code section 125 shall include any amounts not available to a
participant in cash in lieu of group health coverage because the participant is
unable to certify that he has other health coverage (deemed section 125
compensation). An amount will be treated as an amount under Code
section 125 only if the employer does not request or collect information
regarding the participant's other health coverage as part of the enrollment
process for the health plan.
Notwithstanding
the preceding, compensation for a participant in a defined contribution plan who
is permanently and totally disabled (as defined in Code section 22(e)(3))
is the compensation such participant would have received for the limitation year
if the participant had been paid at the rate of compensation paid immediately
before becoming permanently and totally disabled; such imputed compensation for
the disabled participant may be taken into account only if contributions made on
behalf of such participant are nonforfeitable when made.
EIGHTH:
Code Sections 402(f) and 411(a)(11) Notice Periods
Effective
for notices issued on or after January 1, 2007, Section 5.2 is
amended to reflect that the Code section 411(a)(11) compliance notice must
include a description of the consequences of failing to defer receipt of a
distribution in compliance with the changes made by PPA. Effective
for annuity starting dates occurring on or after January 1, 2007,
Section 5.2 is also amended to permit the Code section 411(a)(11)
notice requirement to be met as much as 180 days prior to the annuity
starting date. As amended, the paragraphs amended under
Section 5.2 shall read as follows:
3
(a)
|
Restrictions on Immediate
Distributions – If the value of a participant's vested account
balance derived from employer and employee contributions(1) in plan
years beginning before January 1, 1998, exceeded $3,500 or
(2) in plan years beginning after January 1, 1997, exceeds
$5,000 and the account balance is immediately distributable, the
participant (or where the participant has died, the participant's spouse)
must consent to any distribution of such account
balance. Effective for distributions made on or after March 22,
1999, for the purpose of determining the value of a participant's vested
account balance, prior distributions shall be disregarded if distributions
have not commenced under an optional form of payment described in Section
4.3. The consent of the participant (or the participant's
surviving spouse) shall be obtained in writing within the 180-day period
ending on the annuity starting date. The annuity starting date
is the first day of the first period for which an amount is paid in any
form. The plan administrator shall notify the participant (or
the participant's surviving spouse) of the right to defer any distribution
until the participant's account balance is no longer immediately
distributable. Such notification shall include a general
description of the material features (and an explanation of the relative
values) of the optional forms of benefit available under the plan in a
manner that would satisfy the notice requirements of Code
section 417(a)(3), and shall be provided no less than 30 days
and no more than 180 days prior to the annuity starting
date. However, distribution may commence less than 30 days
after the notice described in the preceding sentence is given, provided
the distribution is one to which Code sections 401(a)(11)
and 417 do not apply, the plan administrator clearly informs the
participant that the participant has a right to a period of at least
30 days after receiving the notice to consider the decision of
whether or not to elect a distribution (and, if applicable, a particular
distribution option), and the participant, after receiving the notice,
affirmatively elects a distribution. Effective for notices
issued on or after January 1, 2007, the written explanation
shall include a description of the consequences of failing to defer
receipt of the distribution.
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* *
*
(b)
|
Safe Harbor Rules – This
Section 5.2(b) shall apply to a participant in this profit sharing
plan, and to any distribution, made on or after the first day of the first
plan year beginning after December 31, 1988, from or under a
separate account attributable solely to accumulated deductible employee
contributions, as defined in Code section 72(o)(5)(B), and maintained
on behalf of a participant in a money purchase pension plan, (including a
target benefit plan). This plan satisfies and shall continue to
satisfy the following conditions: (1) the participant
cannot elect payments in the form of a life annuity; and (2) on the
death of a participant, the participant's vested account balance will be
paid to the participant's surviving spouse, but if there is no surviving
spouse, or if the surviving spouse has consented in a manner conforming to
a qualified election, then to the participant's designated
beneficiary. The surviving spouse may elect to have
distribution of the vested account balance commence within the 180-day
period following the date of the participant's death. The
account balance shall be adjusted for gains or losses occurring after the
participant's death in accordance with the provisions of the plan
governing the adjustment of account balances for other types of
distributions.
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* *
*
NINTH:
Modification of Top-Heavy Rules
Effective
January 1, 2002, Section 5.4(e)(3)(A) and (B) are amended to
provide the correct look back period. As amended,
Section 5.4(e)(3)(A) and (B) shall read as follows:
(e)
|
Definitions (Code Section 416
Requirements)
|
|
(3)
|
Top-Heavy
Ratio
|
|
(A)
|
If
the employer maintains one or more defined contribution plans (including
any Simplified Employee Pension Plan) and the employer has not maintained
any defined benefit plan that during the five-year period ending on the
determination date(s) has or has had accrued benefits, the top-heavy ratio
for this plan alone or for the required or permissive aggregation group as
appropriate is a fraction, the numerator of which is the sum of the
account balances of all key employees as of the determination date(s)
including any part of any account balance distributed in the one-year
period ending on the determination date(s) (five-year period ending on the
determination date in the case of a distribution made for a reason other
than severance from employment, death or disability and in determining
whether the plan is top-heavy for plan years beginning before
January 1, 2002), and the denominator of which is the sum of all
account balances including any part of any account balance distributed in
the one-year period ending on the determination date(s) (five-year period
ending on the determination date in the case of a distribution made for a
reason other than severance from employment, death or disability and in
determining whether the plan is top-heavy for plan years beginning before
January 1, 2002), both computed in accordance with Code
section 416 and the regulations thereunder. Both the
numerator and denominator of the top-heavy ratio are increased to reflect
any contribution not actually made as of the determination date, but which
is required to be taken into account on that date under Code
section 416 and the regulations
thereunder.
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4
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(B)
|
If
the employer maintains one or more defined contribution plans (including
any Simplified Employee Pension Plan) and the employer maintains or has
maintained one or more defined benefit plans that during the five-year
period ending on the determination date(s) has or has had any accrued
benefits, the top-heavy ratio for any required or permissive aggregation
group as appropriate is a fraction, the numerator of which is the sum of
account balances under the aggregated defined contribution plan or plans
for all key employees, determined in accordance with (A) above, and
the present value of accrued benefits under the aggregated defined benefit
plan or plans for all key employees as of the determination date(s), and
the denominator of which is the sum of the account balances under the
aggregated defined contribution plan or plans for all participants,
determined in accordance with (A) above, and the present value of
accrued benefits under the defined benefit plan or plans for all
participants as of the determination date(s), all determined in accordance
with Code section 416 and the regulations thereunder. The
accrued benefits under a defined benefit plan in both the numerator and
denominator of the top-heavy ratio are increased for any distribution of
an accrued benefit made in the one-year period ending on the determination
date (five-year period in determining whether the plan is top-heavy for
plan years beginning before
January 1, 2002).
|
The
accrued benefit of a participant other than a key employee shall be determined
under (1) the method, if any, that uniformly applies for accrual purposes
under all defined benefit plans maintained by the employer, or (2) if there
is no such method, as if such benefit accrued not more rapidly than the slowest
accrual rate permitted under the fractional rule of Code
section 411(b)(1)(C).
TENTH:
Excess Elective Deferral Determination of Income or Loss
Effective
for taxable years beginning on or after January 1, 2008,
Section 5.5(a)(6) is amended to eliminate the use of gap period interest
when determining the income or loss allocable to excess elective
deferrals. As amended, Section 5.5(a)(6) shall read as
follows:
|
(6)
|
Determination of Income or
Loss
|
Excess
elective deferrals shall be adjusted for any income or loss. The
income or loss allocable to excess elective deferrals allocated to each
participant is the sum of: (i) the income or loss allocable to
the participant's elective deferral account(s) for the taxable year multiplied
by a fraction, the numerator of which is such participant's excess elective
deferrals for the year and the denominator is the participant's account balance
attributable to elective deferrals without regard to any income or loss
occurring during such taxable year; and (ii) effective solely for the
taxable year beginning on or after January 1, 2007, and to the extent
the excess elective deferrals are or will be credited with gain or loss as of an
accounting date within the gap period (i.e., the period after the close of the
taxable year and prior to the distribution), 10% of the amount determined under
(i) multiplied by the number of whole calendar months between the end of the
taxable year and the date of distribution, counting the month of distribution if
distribution occurs after the 15th of such month.
ELEVENTH:
Actual Deferral Percentage Test Determination of Income or Loss
Effective
for the plan year beginning on or after January 1, 2008,
Section 5.5(b)(2) is amended to eliminate the gap period income rule for
excess contributions in compliance with the changes made by PPA to Code
section 401(k)(8)(A)(i). As amended, Section 5.5(b)(2)(A)
shall read as follows:
5
|
(A)
|
Determination of Income or
Loss – Excess contributions shall be adjusted for any income or
loss. The income or loss allocable to excess contributions
allocated to each participant is the sum of: (i) the
income or loss allocable to the participant's elective deferral account(s)
(and, if applicable, the qualified nonelective contribution account or the
qualified employer matching contribution account or both) for the plan
year multiplied by a fraction, the numerator of which is such
participant's excess contributions for the year and the denominator is the
participant's account balance(s) attributable to elective deferrals (and
qualified nonelective contributions or qualified matching contributions,
or both, if any of such contributions are included in the ADP test)
without regard to any income or loss occurring during such plan year; and
(ii) effective solely for the plan year beginning on or after
January 1, 2006 and the plan year beginning on or after
January 1, 2007, and to the extent the excess contributions are
or will be credited with gain or loss as of an accounting date within the
gap period (i.e., the period after the close of the plan year and prior to
the distribution), 10% of the amount determined under (i) multiplied by
the number of whole calendar months between the end of the plan year and
the date of distribution, counting the month of distribution if
distribution occurs after the 15th of such
month.
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TWELFTH:
Actual Contribution Percentage Test Determination of Income or Loss
Effective
for the plan year beginning on or after January 1, 2008,
Section 5.5(c)(2) is amended to eliminate the gap period income rule for
excess aggregate contributions in compliance with the changes made by PPA to
Code section 401(m)(6)(A). As amended, Section 5.5(c)(2)(A)
shall read as follows:
|
(A)
|
Determination of Income or
Loss – Excess aggregate contributions shall be adjusted for any
income or loss. The income or loss allocable to excess
aggregate contributions allocated to each participant is the sum
of: (i) the income or loss allocable to the participant's
employee nondeductible contribution account, employer matching
contribution account (if any, and if all amounts therein are not used in
the ADP test) and, if applicable, qualified nonelective contribution
account and elective deferral account(s) for the plan year multiplied by a
fraction, the numerator of which is such participant's excess aggregate
contributions for the year and the denominator is the participant's
account balance(s) attributable to contribution percentage amounts without
regard to any income or loss occurring during such plan year; and
(ii) effective solely for the plan year beginning on or after
January 1, 2006 and the plan year beginning on or after
January 1, 2007, and to the extent the excess contributions are
or will be credited with gain or loss as of an accounting date within the
gap period (i.e., the period after the close of the plan year and prior to
the distribution), 10% of the amount determined under (i) multiplied by
the number of whole calendar months between the end of the plan year and
the date of distribution, counting the month of distribution if
distribution occurs after the 15th of such
month.
|
THIRTEENTH:
Protection of Benefits in Case of Plan Merger
Section 7.3
is amended to comply with Revenue Ruling 2008-40 treating certain
trust-to-trust transfers as distributions. As amended,
Section 7.3 shall contain an additional paragraph that shall read as
follows:
The
transfer of amounts from this trust to a nonqualified foreign trust shall be
treated as a distribution from this plan. Further, the transfer of
assets and liabilities from this plan to a plan that satisfies Puerto Rico Code
section 1165 shall also be treated as a distribution from this
plan.
FOURTEENTH:
Effective Date
These
amendments are effective as of January 1, 2009, except as otherwise
provided herein.
FIFTEENTH:
Remaining Plan Provisions
All other
provisions of the Plan remain in full force and effect.
6
2011 COMPLIANCE AMENDMENT | |||||
TO THE | |||||
WEIS MARKETS, INC. RETIREMENT SAVINGS PLAN | |||||
As authorized by Section 7.2 of the Weis Markets, Inc. Retirement Savings Plan ("Plan") as amended and restated effective January 1, 2009, the employer, Weis Markets, Inc., hereby amends the Plan to comply with the Workers Retirees and Employers Relief Act of 2008 effective as of January 1, 2009, and with other law and regulatory changes effective as of, or prior to, the 2011 plan year and now required to be incorporated into the Plan. This amendment shall supersede the provisions of the Plan to the extent those provisions are inconsistent with the provisions of this amendment. The employer hereby amends the Plan in the following manner: | |||||
FIRST: Exclusions From Compensation | |||||
Section 1.2(b) is amended to remove the compensation exclusion that formerly applied to pharmacists. As amended, Section 1.2(b) shall read as follows: | |||||
(b) | Exclusions From Compensation – Notwithstanding the provisions of Section 1.2(a), the following types of remuneration shall be excluded from the participant's compensation: | ||||
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Meal Allowances | ||||
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Auto Personal Use | ||||
|
Sick Pay | ||||
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Stock Appreciation Rights | ||||
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Bonuses | ||||
SECOND: Profit Sharing Allocation Formula | |||||
Section 3.2(c)(1) is amended to change the regular profit sharing allocation formula from a unit credit to a two part discretionary formula permitting both flat dollar allocations and in ratio to compensation allocations each plan year. As amended, Section 3.2(c)(1) shall read as follows: | |||||
The employer shall make a separate profit sharing contribution for the plan year with respect to each allocation formula as described below. The trustee shall be notified by the employer in writing as to the amount being contributed with respect to each formula. Forfeitures for the plan year shall be allocated under allocation formula (B) below. For this purpose, the following allocation formulas shall be used: | |||||
(A) | The employer profit sharing contribution shall be allocated to the profit sharing account of each eligible participant in equal amounts, but not in excess of the maximum permissible amount as defined in Section 5.1(c). | ||||
(B) | The employer profit sharing contribution and forfeitures for the plan year shall be allocated to the profit sharing account of each eligible participant in the ratio that such participant's compensation bears to the compensation of all participants. | ||||
THIRD: Employer Matching Contribution Allocation Formula | |||||
Effective April 1, 2012, Section 3.6(d)(1) is amended to change the employer matching contribution allocation formula from a described formula to a fully discretionary formula. As amended, Section 3.6(d)(1) shall read as follows: | |||||
(d) | (1) | Allocation Formula – The employer matching contribution and any applicable forfeitures shall be equal to the employer matching percentage applied to the participant's contributions for each allocation period within the current plan year that are subject to matching. The employer matching percentage shall be determined each year by the employer in its own discretion. | |||
FOURTH: Definitions (Code Section 415 Limitations) – Compensation | |||||
Effective for limitation years beginning on or after January 1, 2009, Section 5.1(c)(2) is amended to comply with Code section 414(u)(12) as added by the Heroes Earnings Assistance and Relief Tax Act of 2008 (HEART) regarding differential wage payments. As amended, Section 5.1(c)(2) shall contain the following additional paragraph that shall read as follows: | |||||
For limitation years beginning after December 31, 2008, compensation for a limitation year shall include amounts paid as differential wages to a participant on qualified military service leave of more than 30 days and otherwise meeting the requirements of Code section 3401(h)(2). | |||||
FIFTH: Minimum Required Distribution Temporary Waiver for 2009 | |||||
Section 5.3 is amended to temporarily waive the minimum distribution requirement to comply with Code section 401(a)(9)(H) as added by the Workers Retirees and Employers Relief Act of 2008. As amended, the preamble of Section 5.3 shall contain an additional paragraph that shall read as follows: | |||||
With respect to calendar year 2009, the provisions of Section 5.3 shall be applied subject to Code section 401(a)(9)(H). Although the plan administrator shall calculate any required minimum distribution under Section 5.3 and pay it separately to any participant or beneficiary commencing distribution during 2009, such recipient shall be eligible to deposit such amount in a qualified employer plan or individual retirement account. Any participant (i) receiving required minimum distributions as a non-5% owner who elected to continue such distributions after January 1, 2003, or (ii) receiving or due to commence such distributions as a 5% owner shall not receive a required minimum distribution with respect to 2009 in the absence of an affirmative election. To the extent that a participant's entire interest is otherwise required to be distributed to a beneficiary by December 31 of the calendar year containing the fifth anniversary of the participant's death, such 5-year period shall be determined without regard to calendar year 2009. | |||||
SIXTH: Trust Fund Expenses | |||||
Effective as of the adoption of this amendment, Section 6.4(e) is amended to provide that although the trust fund may pay the reasonable expenses incurred in the administration of the plan and the investment of the fund, the precise handling of such expenses shall be addressed outside of the plan document. Further, certain expenses incurred with respect to a particular participant or beneficiary may be allocated against the participant's account on a direct basis. As amended, Section 6.4(e) shall read as follows: | |||||
The trust fund may pay the expenses incurred in the administration of the plan and the investment of the fund, provided the cost is reasonable. Such expenses shall include legal fees incurred by the plan administrator or the trustee, provided such fiduciaries are not proven to have committed a prohibited transaction. If the trust fund pays the expenses, the expenses generally shall be allocated against the participant accounts on a pro rata basis. Certain expenses incurred with respect to a particular participant or beneficiary may be allocated against the participant's account on a direct basis. The plan administrator shall communicate such expense charges to the participant through a written notice. | |||||
SEVENTH: Effective Date | |||||
These amendments are effective as of January 1, 2011, except as otherwise provided herein. | |||||
EIGHTH: Remaining Plan Provisions | |||||
All other provisions of the Plan remain in full force and effect. | |||||