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06-19-2003C/tv Jeffrey M. Perlow, Mayor Zev Auerbach Jay R. Beskln Ken Cohen Bob Diamond Manny Grossman Harry Holzberg hvTlvlventCity of ara Eric M. Soroka Teresa M. Soroka, CMC C/_tv AtWrae_v Weiss Scrota Heffman Pastoriaa & Guedes AGENDA JUNE 19, 2003 10 AM Government Center 19200 West County Club D~ve Aventura, Florida 33180 CALL TO ORDER~ROLL CALL 2. RESOLUTIONS: A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF AVENTURA, FLORIDA AUTHORIZING THE CITY MANAGER TO EXECUTE THE ATTACHED REVISED LOAN GUIDELINES AND TRANSMIT SANIE TO THE ICMA RETIREMENT CORPORATION; AUTHORIZING THE CITY MANAGER TO DO ALL THINGS NECESSARY TO CARRY OUT THE AIMS OF THIS RESOLUTION; AND PROVIDING AN EFFECTIVE DATE. A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF AVENTURA, FLORIDA AUTHORIZING THE CITY MANAGER TO EXECUTE THE ATTACHED 457 PLANS LOAN GUIDELINES AND TRANSMIT SAME TO THE ICMA RETIREMENT CORPORATION; AUTHORIZING THE CITY MANAGER TO DO ALL THINGS NECESSARY TO CARRY OUT THE AIMS OF THIS RESOLUTION; AND PROVIDING AN EFFECTIVE DATE. 3. ADJOURNMENT This meeting is open to the public. In accordance with the Americans with Disabilities Act of 1990, all persons who are disabled and who need special accommx~ations to participate in this meeting because of that disability should contact the Office of the City Clerk, 305466-8901, not later than two days prior to such proceeding. One or more membe~ of the City of Aventura Advisory Boards may be in attendance. Anyone wishing to appeal any decision made by the Aventura City Commission with respect to any matter considered at such meeting or hearing will need a record of the proceedings and, for such purpose, may need to ensure that a verbatim record of the proceedings is made, which record includes the testimony and evidence upon which the appeal is to be based. Agenda items may be viewed at the Office of the City Clerk, City of Aventura Government Center, 19200 W. Country Club Drive, Aventura, Florida, 33180. Anyone wishing to obtain a copy of any agenda item should contact the City Clerk at 305-466- 8901. CITY OF AVENTURA FINANCE SUPPORT SERVICES DEPARTMENT MEMORANDUM TO: FROM: BY: DATE: SUBJECT: City Commission arry . Kilgore, Fina.u~.o~,~ort Services Director \1 June 12, 2003 Resolution Revising Loan Provisions for 401 Retirement Plans June 19, 2003 Commission Meeting Agenda Item r~-~ Recommendation It is recommended that the City Commission approve the Resolution which will allow employees to refinance an existing loan in the same calendar year as the original loan was made. BackRround During the process of a refinancing request for a loan. ICMA Retirement Corporation advised the City that the refinancing was not allowed by the Loan Guidelines for the Plan. This was an interpretation by ICMA of the prohibition against having two loans in the same calendar year. While I disagree with their interpretation, I believe the City is best served by amending the loan guidelines to specifically allow the refinancing, rather than have a possible legal battle with ICMA Retirement Corporation. This change has no affect on the City since the employee would only be borrowing a larger portion of their vested balance in their 401 account. I, therefore, recommend approval. HMK/mn RESOLUTION NO. 2003- A RESOLUTION OF THE CITY COMMISSION OF THE CiTY OF AVENTURA, FLORIDA AUTHORIZING THE CITY MANAGER TO EXECUTE THE ATTACHED REVISED LOAN GUIDELINES AND TRANSMIT SAME TO THE ICMA RETIREMENT CORPORATION; AUTHORIZING THE CITY MANAGER TO DO ALL THINGS NECESSARY TO CARRY OUT THE AIMS OF THIS RESOLUTION; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Aventura has employees rendering valuable services and in recognition of said valuable services, the City adopted Resolution No. 96-19 establishing money purchase plans for all full time City employees; and WHEREAS, the City adopted Resolution No. 2003-13 amending the Loan Guidelines contained in the money purchase plans for all full time City employees; and WHEREAS, City staff and the City Manager recommend that Loan Guidelines for Plan No 9534 covering General Employees and Plan 9535 covering Department Directors and Assistant Department Directors and Plan 9536 covering the City Manager be further amended to allow the ability to refinance an existing loan within the same calendar year the loan is issued; and WHEREAS, the City Commission, concurs with said recommendation. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF AVENTURA, FLORIDA, THAT: Section1: The City Manager is hereby authorized to execute the attached Revised Adoption Agreement and to transmit same to the ICMA Retirement Corporation. Section 2: The City Manager is hereby authorized to do all things necessary to carry out the aims of this Resolution. Section 3: This adoption. The foregoing resolution was offered by Commissioner moved its adoption. The motion was seconded by Commissioner upon being put to a vote, the vote was as follows: Resolution shall become effective immediately upon its who and Commissioner Zev Auerbach Commissioner Jay R. Beskin Commissioner Ken Cohen Commissioner Bob Diamond Commissioner Harry Holzberg Vice Mayor Manny Grossman Mayor Jeffrey M. Perlow Resolution No. 2003-__ Page _ PASSED AND ADOPTED THIS 19th day of June, 2003 JEFFREY M. PERLOW, MAYOR ATTEST: TERESA M. SOROKA, CMC CITY CLERK APPROVED AS TO LEGAL SUFFICIENCY: CITY ATTORNEY EFFECTIVE DATE 6/19/03 LOAN GUIDELINES REVISED AS OF FEBRUARy 4, 2003 NAME OF PLAN: . EFfPLOYEES' RETItLEM~NT PLAN {. PURPOSE Thc purpose of these guidelines is to establish the terms and conditions under which thc Employer will grant loans to participants. This is the only official ,Loan Program Document of thc above naracd Plan. Il. ELIGIBILITY Loans are available to all active employees. Loans will not bc granted to participants who have ~n existing loan in default Lom-~s are available from the following sources: [select one or both] Employer Contribution Account (vested balances only) Participant Contribution Accounts (pre- and post-tax, if applicable, including Employee Mandatory, Employee Voluntary, Employer Koilover, and Portable Benefits Accounts but excluding the Deduct- ible Employee Con~bution/Qualified Voluntary Employee Contribution Account) Loams will be pro-rated among all the funds in which the participant is invested at the time the loan is made. Loans are available for thc following purposes: [select one] All purposes .-.l~--Loans shall only be granted in the event of a partinlpant's hardship or for the purpose of enabling a participant to meet certain specified financial situations. The Emplbyer shall determine, based on all relevant facts and circumstmnces, that the amount of the loan is not in excess of the amount required to relieve the financial need. For this purpose, financial need shall include, but not be limited to: unreimbursed medical expenses of the participant or members of the participant's immediate family, establishing or subst~.utially rehabilitating the principal residence of the participant, or paying for a college education (including graduate studies) for the participant or his/her dependents. Ill. FREQUENCy OF LOANS [select one] --~--Participants may receive one loan par calendar year. Moreover, participants may have only one outstanding loan at a tLme. PaCicipants may receive one loan per calendar year. Moreover, no participant may have more than five (5) loans outstanding at one t/me. Participants may refinance an existing loan within the same calendar Plan year the loan.was issued. PP93F IV. LOAN AMOUNT The m.L~mum loan amount is $1,000. The maximum loan aniount is: DATE 6119/03 the lesser of: (i) (2) $50,000, reduced by the excess (if any) of: a. The Mghest outst~ding balance of loans during the one-year period ending on · c day before ~c date & io~ is ~ bc m~c, over b. ~c ou~tm~g b~cc of lo~s on ~c dat~ ~c lo~ is to be made; or 1/2 of ~e p~cip~nt's vexed mccount b~. [fa participant has any loans outstanding at the dine a new loan is requested, the new loan will bc lkrdted to thc maxi.mum amo_uht calculated ~bove reduced by the total of the outstandLug loans. V. LENGTH OF LOAN .A loan must bc repaid in substantially equal installments of principal and intcre.~t, at le~t monthly, over a period that does not exceed five (5) years. Lo,ms for a principal residence must be repaid in substantially equal installments of principal and interest, at lcmst monthly, o~er no more than ] N [state number of years] years (maximum 30 years).. VI. LOAN REPAYMENT PROCESS Loans for active employees must be repaid through payroll deduction. Kepayment will begin ms soon ms practi- cable on a date determined by the Employer's payroll cycle. Loans outstanding for former employees who are allowed under Section X. to maintain their loans or loans ou~tanding for employees on a leave of absence must be repaid on th~ same schedule ms ifpayrolI deductions were stil/being made unless they reamortize their loans and establish a new repayment schedule which provides ...' that substantially equal payments are rrmde, at least monthly over the remaining period of the loan. All repayments must be made through the Employer. Loan payments, including loan payments from former employees, are allocated to the same investment options designaled on khc 4131 Enrollment Form or according to the most current 401 change form whch spcdfies ConMbudon allocations. VII. LOAN INTEREST RATE · ? The rate of interest for loans of five (5) years or less will be based on'prime plus 0.5%. The rate of inierest for lo~ for a principal residence will be based on the FHA/VA rate. Interest rates are determ/ned on the last business day of the month preceding thc month the lo'mis disbursed. The interest rate is locked in at the time a loan is approved and remains constant throughout the life of the loan. The prime interest ram is determined on the last business day of each month using the Wall Street Journal ms the source. The FHA/VA interest rate is also determined on the last business day of each month using the Telerate Information Service ms the source. .... ~ PPg3F EFFECTIVE DA'IR 6/19/03 Loan interest rates for new Loans may fluctuate upward or downward monti~y, depending on the movement of the prime and FI-Lk~A interest rates. Thc Employer may modify the mariner in which loan interest rates will be determined, but only with respect to famre loans. VIII. LOAN APPLICATION PROCEDURE All loans must be requested in writing on a.n application approved by the Plan Administrator. The application must be signed by the participant The Employer must review and approve the application~ If the participant is married at the t/me of apl~3ication, ant/spousal consent is required by the plan for the loan, the participant's spouse must consent, in writing, to the loan and the'consent must be witnessed by a plan repre- sentadve or notary public. Such consent must be given within the ninety (90) day period before thc time the loan is made. Spousal consent, if required, must accompany the application in order for the application to be ' considered complete. The participant will be required to sign a promissory note evidencing the loan and a disclosure statement which includes an amortization schedule prior to receiving a loan check. Loan checks will generally be issued on the Friday following the receipt of a complete loan application. The loan check, promissory note, disclosure statement and truth-in-lending recision notice will be sent to the Employer, who will obtain the necessary signatures sad deliver the check to the participant. All executed documents must be returned to the Plan Administrator within 10 calendar days from the date the check is issued. IX. SECU RITY/COLLATEPekL That portion of a participant's vested account balance that is equal to the mount of the loan is used as collateral for the loan. The collateral amount may not exceed 50% of the participant's Vested account balance at the time · .loan is taken. Only that portion of the vested account balance that corresponds to'the amount of the outstanding loan balance is used as collateral. X.' ACCELERATION [select one] [] All loans are due and payable in lo.il upon separation from service. All loam are due and payable when a participant receives a distribution of al/of his/her account balance after separat/on from service. The a.mount of the outstanding loan balance will be r~ported as a distribution in addition to the amount of cash distributed from the plan. Ali loans are duc and payable when a participant receives'.,a distribution of part of l:fis/her account balance after separation from Service. The amount of the ob&standing loan balance will reported ~ a distribution in addition to the amount of cash distributed from the plan. PP93F DATE 6/19/03 XI. REAMORTIZATION Any outstanding loan may be reamordzcd. Recmortizadon means changing the terms of a loan, such as length of repayment period, interest rate, and frequency of repayments. A loan may not be reamortiz~d to extend the length of the loan repayment period to more than five (5) years from the date the loan was originally made, or in the case of a loan to secure a principal residence, beyond the number of years specified by the Employer in Section V. above. A participant must request the reamortizafion of a loan in writing on a reamortization application acceptable to the Plan Administrator. Spousal consent must aCcompany the request for reamortization when such consent is required by the plan. Upon processing the request, a new disclosure statement w/il be sent to the Employer for endorsement by the participant and approval by the Employer. Tim executed disclosure statement must be returned to the Plan Administra- tor within 10 calendar days from the date it is signed. The new disclosure statement is considered an amendment to the original promissory note, therefore a new promissory note wig not be r. equired. A reamortization will not be considered a new loan for purposes of calculating the number of loam out.~tandmg or the one loan per calendar limit XII. REFINAN-CING EXISTING LOANS If a participant has one outstanding loan, that loan may be refinanced. It' a participant ha~ more than one outstand- ing loan, no loans may be refinanced. Refinancing means concurrently repaying an existing loan and borrowing ah additional amount through a new loan. In order to refinance an existing loan, a participant must request a new loan in writing on an application approved by the Plan Administrator. Spousal consent must accompany the application when such consent is required by the plar~ Such request must be made at a time when the participant is eligible to obtain a loan as defined by the Employer in Section III. above. The amount of a new loan requested for the purpose of refinancing is subject to the loan limits specified in Section IV. above. Because a refinancing is considered a new loan, ~nly active employees may refinance an outstanding loam XIII. REDUCTION OF LOAN If a participant dies and leaves an outstanding loan, the unpaid loan balance will be repaid from the account balance before any distributions are made to a beneficiary. XIV. LOAN DEFAULT If a required payment of principal and interest is not made within 90 days of the date such payment ts due, the · Ioan is considered in default. If a loan is in default, the loan will be foreclosed during the calendar year in which the participant separates from service. However, the IRS "deems" a default to be a distribution in the year the default occurs. Therefore, the amount of the outstanding loan at the time of the default, including accrued interest, will be reported to the IRS as a distribution in the year the default occur~ even though the loan may not be fore- closed at that time. The distr}bution may be subject to taxes and possibi~ a penalty for early withdrawal. If a participant has separated from service and defaults'on a loan, then the loan wilt be foreclosed during the calendar year in which the default occurs. The amount of thc outstanding loan, ~cluding accrued interest, will be reported to the IRS as a distribution which may be subject to taxes and poasibly a penalty for early withdrawall ........ ~ . PP93F EFFECTIVE DATE 6/19/03 Emptoyzr b. ms erected [n Section ,K. arid tb.e pro~aso p~cip~n[ a~p~[cs from sa~[ce. for a~[y w~w~. when ~a p~cipant ~ke~ a ~[bu~on of soma o~ ~ of ~ b~ca ~ ~s~cr accounE ~s~bu~on ck~ck. ~a ~ount of ~ ouUt~ag [o~, [aclud[ng acc~ad ~t~rast, will ~ ~ ~s~bu~on ~ch tomy b~ subject to t~x~a ~d possibly m p~n~ for ~iy XV. DE MINIMIS ACCOUNTS AND OUTSTANDING LOAN BALANCE If a p~'ticipamt ~.~parates from servica ~ld the particip~.n~'s tots/v~st~4 accost b~c~, ~clu~g ~ o~g io~ b~c, [~ ~5,500 or I~aa, ~a PI~ will tutom~c~y foracios~ ~ lo~. ~ tcco~ b~c~ fam~ng ~ef ~s~budon, w~ch m~y ba ~bj~ct to tzx~s ~ possibly m p~n~ty fo~ ~[y w~w~. XVI. FEES Eeoc mty be charged for v~ions services m~sociated with thc tpplication for a_nd issuance of Io~. klI ~ppHcabta fe~s will b~ d~bit~d ~om ~a p~cip~t's ~ccoun~ b~c~. A sch~dule of f~es mpplicab[~ t~ ~a Pi~ ia ~valible ~om ~e Pi~ kd~aWator. XVII. OTHER Tho Employer h~ thc right to sot otlmr t~rms ~nd conditions ~ it de,ms necessary for loams from the Plan in order to comply with ~ny legal roqudromen~. Ail t~rmg ~uad conditions will bt mdrainistered in t uniform no~-discnm/nator-y marm~r. I.n V, Zita~s~ V'fher~of, the. Employ~r h~rsby c~.us~d these Guidelines to bt ~xacutsd this , 19 day of EMPLOYER BY: Eric TITLE: C?rY' P1anag~r ATTEST., ACCEPTED: ICMA RETIREMENT C_OP,,POR,'kTION BY: ', -TITLE: ATTEST: DATE 6/19/03 LOAN GUIDELINES REVISED AS OF FEBRUARY 4, 2003 NAME OF PLAN: (2TT¥ fl'~ AVI~'qq~%TT~A CITY MANAGER RETIREMENT PLA~ I. PURPOSE The purpose of these guidelines is to establish the terms and conditions under which the Employer will grant loans to participants. This is the only Official Loan Program Document of the above named Plan. II. ELIGIBILITY Loans ~re available to all active employe~. Loans will not be granted to participants who have an existing loan in dcfault Loans aze av~Llable from the following sources: [select one or both] Employer Contribution Account (vested balances only) Pm-ticipant Contribution Accounts (pre- and post-t~.x, if applicable, including Employee Mandatory, Employee Voluntary, Employer KolloYer, and Portable Benefits Accounts, but excluding the Deduct- ible Employee ContribUtiovdQu~ified Voluntm-y Employee ConUibution Account) Loans wilt be pro-rated among ali the funds in which the pm-ticipant is inve~ted at the time the loan is made. Loans aze available for the following purposes: [select one] All purposes '-Loans shall only be granted in the event 'of a pmTicipant's h~rdship or for the purpose of enabling a participant to meet certain specified fm~mcial situations. The Employer ahall d~termine, bmsed on all relevant facts and circumstances, that the amount of the loan is not in excess of the amount required to relieve the financial need. For this purpose, financial need shall inclu~, but not be limited to: u.u~eimbursed medical expenses of the paz'dcipant or members of the participant's immediate family, establishing or substantially rehabilitating the principal residence of the participant, or paying for a college education (including graduate studies) for the pm-ticipant or his/her dependents. III. FREQUENCY OF LOANS [select one] --~A~i--Participants may receive one loan per calend~r year. Moreover, participants may have only one out. tending loan at a time. ~ Parficipan~mayreccivconeloanpcrcalcnd~ ye~.Moreo¥~,nopm-~cipant may have more than five (5) lomn~ outstanding ~ one time. ] Participants may refinance an existing loan within the same calendar Plan Year the loan ~as issued. PP93F EFFECTIVE DATE 6]19i03 IV. LOAN AMOUNT The minimum loan amount is $t,000. Thc maximm'n loan umount is: the lesser ~f: (1) (2) $50,000, reduced by thc excess (if any] of: a. The highest outstanding balance of loans during the one-year period ending on the day before the date a loan is to be made, over b Thc outstan/dng balance of loans on thc date thc loan is robc made; or I/2 3fthe participant's vested account balance. [fa participant has any lomas outstanding at the time a new loan is requested, the new loan will be limited to the maximum amouht calculated above reduced by the total of the outstanding loans. V. LENGTH OF LOAN A loan must be repaid in substantially equal installments of principal and interest, at least monthly, over a period that does not exceed five (5) years. Loans for a principal residence must be repaid in substantially equal installments of principaI and interest, at least monthly, over no more than 3' g [state number of years] years (maximum 30 years). VI. LOAN REPAYMENT PROCESS Loans for active employees must be repaid through payroll deduction. Repayment will begin as soon as practi- cable on a date deterrrfined by the Employer's payrolI cycle. Loans outstanding for former employees who are allowed under Section X. to maintain their loans or loans outstanding for employees on a leave of absence must be repaid on the same schedule as if payrbll deductions were still being made unless they reamortize their loans and establish a new repayment schedule which provides "' that substantially equal payments are made at least monthly over the remaining period of the loan. All repayments must be made through the Employer. Loan paymxmts, including loan payments from former employees, are allocated to the same investment-optious designated on the 401 Enrollment Form or accordoag to the most current 401 change form which specifies. contribution allocations. VII. LOAN INTEREST RATE The rate of interest for loans of five (5) years or less will be based on prknc plus 0.5%. The rate of interest for loans for a principal residence will be b~ed on the FHA/VA rate. Interest rates are determined on the last business day of the.month preceding the month the loan is disbursed. The interest rate is locked in at the time a loan is approved and remains constant throughout the life of the loan. The prime interest rate is determined on the last business day of each month using the Wall Street Journal as the soUrce. Thc FHA/VA interest rate is also determined on the last business day Of each month using the Telerate Information Service a~ the soUrce. ....... PP93F 6119103 Loan interest rates for new loans may fluctuate upward or downward monthly, depending on the movement of the prime and FHA/VA interest rates. The Employer may modify the manner.~n which loan interest rates will be determined, but only with respect to future loans. VIII. LOAN APPLICATION PROCEDURE Ail loans must be requested in writing on an application approved by the Plan Administrator. The application must be signed by the participant_ The Employer must review and approve the application. If the participant is married at the time of application, and spousal consent is required by the plan for the loan, the participant's spouse must consent, in writing, to the loan and the'consent must be witnessed by a plan repre- sentative or notary public. Such consent must be given within the ninety (90) day period before the time the loan is marie. Spousal consent, if required, must accompany the application in order for the application to be considered complete. The participant will be required to sign a promissory note evidencing the loan and a disclosure statement which. includes an amortization schedule prior to receiving a loan check. Loan checks will generally be issued on the Friday following the receipt of a complete loan application. The loan check, Promissory note, disclosure statement md truth-in-lending recision notice wiI1 be sent to the Employer, who will obtain the necessary signatures and deliver the check to the participant. Ail executed documents must be returned to the Plan Administrator within I0 calendar days from the date the check is issued. IX.. SECURITY/COLLATERAL That portion of a participant's vested account balance that is equal to the arnomnt of the loan is used as collateral for the loan. The collateral amount may not exceed 50% of the par'dcipant's vested account balance at the time the loan is taken. Only that port/on of the vested accomnt balance that corresponds to the amount of the outstanding loan balance is used as collateral. X. ACCELERATION [select one] All loans m.re due and payable in full upon separation from service. All loans are due and payable when a participant receive~ a distribution of ali of his/her account balance after separation from service. The amount of the outstanding lomn balance will be reported as a distribution in addition to thc amount of cash distributed from the plan. All loans are due and payable when a participant receives'a distribution of part of his/her account balance aRer separation from service. The amount of the oktsta.nding loan balance will reported as a distribution in addition to the amount of cash distributed from the plan. PP93F EFFECTIVE DATE 6/19/03 XI. REAMORTIZATION Any outstanding loan may be reamorazed. Remmort~ahon means changsng the terms of a loar~ such as length of repayment period, interest rate, and frequency of repayments. A loan may not be reamortized to extend the length of the loan repayment period to more than five (5) years from the date the loan was originally made, or in the case of a Ioan to secure a principal residence, beyend the number of years specified by the Employer in Section V. above. A participant must request the reamortization of a loan in writing on a reamortization application acceptable to the Plan Administrator. Spousal consent must accompany the request for reamortization when such consent is required by the plan. Upon processing the request, a new disclosure statement will be sent to the Employer for endorsement by the participant and approval by the Employer. The executed disci0sure statement must be returned to the Plan Administra- tor witMn 10 calendar days from the date it is signed. The new disclosure statement is considered an amendment to the original promissory note, therefore a new promissory note will not be .required A reamor'fization will not be considered a new loan for purposes of calculating the number of loans outsm.uding or the one loan per calendar limit Xll. REFINANCING EXISTING LOANS If a participant has one outstanding loan, that loan may be refinanced. If a participant has more than one outstand- iCg loan, no loans may be refinanced. Refinancing means concurrent/y repaying an ex/sting loan and borrowing an additional amount through a new loan. In order to refinance an existing loan, a participant must request a new loan in writing on mn application approved by the Plan Administrator. Spousal consent must accompany the application when such consent is required by the plan. Such request must be made at a time when the participant is eligible to obtain a Ioan as defined by the Employer in Section IH. above. The amount of a new loan requested for the purpose of refinancing is subject to the loan limits specified in Section IV. above. Because a refinancing is considered a new loan, only active employees may refinance an outstanding loan_ Xlll. REDUCTION OF LOAN If a participant dies and leaves an outstanding loan, the unpaid loan balance will be repaid from the account balance before any distributions are made to a beneficiary. XIV. LOAN DEFAULT If a required payment of principal and interest is not made within 90 days of the date suc2~ payment'is due, the loan is considered in default. If a loan is in default, the loan will be foreclosed during the calendar year in which the participant separates from service. However, the IRS "deems" a default to be a distribution in the year the default occurs. Therefore, the amount of the ontstand~ng loan at the time of the default, including accrued interest, will be reported'to the IRS as a distribution in the year the default occurs even though the loan may not be fore- closed at that time. The distribution may be subject to taxes, and possibly a penalty for early withdrawal. If a participant has separated from service and defaults on a loan, then the loan will be foreclosed during the calendar year in which the default occurs. The amount of the outstanding loan, including accrued interest, will be reported to the IRS as a distribut/on which may be subject to taxes and possibly a penalty for early withdrawal. PP93F EFFECTIVE DATE 6/19/03 [f ~h¢ Employer h~ =[actzd ir, Section X. ;md thz promisser7 mo~a so pr6vidaa, ~ [o~ becomes du~ and thc Employer h~ so elected m Sac[ion X. arid the pi-om/ssom/note so provides, s. Ios. n becomes due ~.nd payable w~.en abe ps.~cip~n[ U. kes a dis~ribu~on of some of ~ of the bahmce in his/her account ~'~er separaaon [rom sarwlce. If ~he terms of the loan~ con[sin such a provision ~.nd ~ke ou~mndin~ [o~m b~smce is mo~ paid prior to the alisa/bunion fi-om ~e accou, nL ~e outsts, ndiag loan ~.moun~ will be cor~ide~ed in default upon i~suaace of the disU/bu~on check. The amount of ~e outstu'~dia§ lo~uL including accrued interesL will be repofZed to ~e [RS a dis~bu~ion which may be subject to Jinxes ~nd possibly a penal~y for e~y wi~drawal. XV, DE MINIMIS ACCOUNTS AND OUTSTANDING LOAN BALANCE If a participant ~epaz~tas from service ~d ~e p~cip~c's tot~ va~t~d acco~t 1o~ bai~, is ~3,500 or leas, ~a PI~ will mutomadc~ly foreclose Pi~. If ~s occ~s, ~: ~o~nt of ~ 1o~, ~clu~ag accrued ~s~bu~on, wMch may bt subjac~ ~o t~as ~d possibly XV[. FEES Fees may be ~rged for v~fious services associaled with ~e application for ~d bau~ca of lo~s. Ali appEcabtc XVIL OTHER Thc Employer ha~ thc fight to set or.h~r terrrm and conditioni ~ it deems necessary for lom-~ from D.e Phmin order to comply with amy legal requimmen=. Ali t~rmx and conditions will be admi~is%ered in a uniform ~d no~-discriminmtory manner. , 19 d~y'of EMPLOYER BY: Eric M ' 'S:roka, TITLE: CitY' ganage'~__, ATTEST:, ACCEPTED: tCMA RETIREMENT CORPORATION BY: .... TITLE: A'l-f EST: .B~CTIVE DATE 6/19/03 LOAN GUIDELINES KEVISEID AS OF FEBRUARY 4, 2003 NAME OF PLAN: CITY OF AVENTURA DEPARTMENT DIRECTORS AND ASSISTANTS DIRECTORS RETIREMENT PLAN I. PURPOSE The purpose of these guidelin~ is to establish the terms and conditions under which the Employer will gramt loams to participants. This is the only official Loan Program Document oft_he above named Plan. 11. ELIGIBILITY Loans are available to all active employees. Loans will not be granted to participants who have an existing loan ' in default_ Loams are available from the following sources: [select one or both] Employer Contribution Account (vested balances only) Participant'Contribution Accounts (pre- and post-t~x, if applicable, including Employee Mandatory, Employee Voluntary, Employer Rollover, and Portable Benefits Accounts, but excluding the Deduct- ible Employee Contribution/Qualified Voluntary Employee Contribution Account) Loans will be pro:rated among all the funds in which the participant is invested at the time the loan is made. Loans are ava/lable for the following purposes: [select one] All purposes -" Loans shall only be granted in the event of a participant's hardship or for the purpose of enabling a participant to meet certain specified financial situations. The Employer shall ~termiae, b~ed on all relevant fact~ and circumstances, that the amount of the loan is not in excess of the amount required to relieve the financial need. For this purpose, financial need shall include, but not be limited to: unreimbursed medical expenses of the participant or members of the participant's immediate family, establishing or su~stantiMly.rehabilitating the principal residence of the participant, or paying for a college education (including graduate studies) for the participant or hisfaer dependents. I11. FREQUENCY OF LOANS [select one] __-K2-_-Par~icipants may receive one loan per calendar year. Moreover, participants may have only one outstanding loan at a time. Participants may receive one loan per calendar year. Moreover, no pard. cipam may have more than five (5) loans outstanding at one time. Participants may refinance an existing loan within the same calendar Plan .year the loan was issued. PP~3F IV. LOAN AMOUNT The minimum loan amount is $1,000. . ~v~C~IVE DATE 6/1~/0~' · · Thc maximum loan amount is: the lesser of: (1) (2) $50,000, reduced by thc excess (if any) of: The highest outstanding balance of loans during the one-year period ending on the day before the date a loan is to be made, over b. The outstanfling balance of IoanS on the date the loan is to be made; or. 1/2 of the pm-~dcipant's vested account baiance.' If a participant has any loans outstanding at thc time a new loan is requested, the new loan will be lirnitcd to thc maXtmum arno :unt calculated above reduced by the total of the ou~tanding loans. V. LENGTH OF LOAN A loan must be repaid in substantially equal installments of principal and interest, at least monthly, over a period that does not exceed five (5) years. ' Loans for a principal residence must be repaid in substantially equal installments of principal and interest, at least monthly, over no more than 1 .O [state number of years] years (maximum 30 years). VI. LOAN REPAYMENT PROCESS Lo~rm for active employees must be repaid through payroll deduction. Repayment will begin as soon as pract/- cable on a date determined by the Employer's payroll cycle. Loans outstanding for former employees who are allowed under Section X. to maintain their loans or loans .outstanding for employees on a leave of absence must be repaid on the same schedule as if payroll deductions were still being made unless they reamortize their loans and establish a new repaYment schedule which provides that substantially equal payments are made at least monthly over the remaining period of the loan. Al/repayments must be made through the Employer. Loan paymer~.s, ~ucluding loan payments from former employees, are allocated to the same investment, options designated on the 401 Enrollment Form or according to thc most current 401 cha~ge form.whlch.specffies contribution allocations, VII. LOAN INTEREST RATE The rate of interest for loans of five (5) years or less will be based on ~rime plus 0.5 %. The rate of interest for loans for a principal residence will be based on the FHA/VA rate. Interest rams are demrm.ined on thc last business day of the month preceding the month the loan is disbursed. The interest rate is locked in at the t/me a loan is approved and remains constant throughout the life of the loan. The prime interest ram is determined on the last business day of each month using the Wall Street Journal as the source. The FHA/VA interest rate is also determined on the last business day of each month using the Telerate Information Service as thc source. PP93F EFFIKCTI%rE DA~ 6/19/03 Loan interest rates for new loans may fluctuate upward or downward monthly, depending on thc movement of the prime and FHA/VA interest rates. The Employer may modify thc manner in which loan interest rams will be determined, but only with respect to future loans. VIII. LOAN APPLICATION PROCEDURE Ail loans must be requested in writing on an application approved by the Plan Administrator. T~e application must be signed bY the participant The Employer must review and approve the application. If the paracipant is married at the time of aplSIication, and spousal consent is required by the plan for the loan, the participant's 'spouse must consent, in writing, to the loan and the'consent must be witnessed by a plan repre- sentative or notary public. Such consent must be given within the ninety (90) day period before the time the Ioan is made. Spousal consent, if required, must accompany the application in order for the application to be considered comp_lete. The participant will be required to sign a promissory note evidencing the loan and a disclosure statement which includes an amortization schedule prior to receiving a loan check. Loan checl~ will generally be issued on the Friday following the receipt of a complete loan application. The loan check, promissory note, disclosure statement and truth-in-lending recision notice will be sent to the Employer, who will obtain the necessary signatures and deliver the check to the participant. All executed documenB must be returned to the Plan Administrator witi'fin 10 calendar days from the date the check is issaed. IX. SECURITY/COLLATERAL That portion of a participant's vested account balance that is equal to the amount of the loan is used as collateral for the loan. The collateral amount may not exceed 50% of the participant's vested account bal~ce at the t/me the loan is taken. Only that portion of the vested account balance that corresponds to the amount of the outstanding loan balance is used as collateral. X. ACCELERATION [select one] Ail loans are due and pa~able in full upon separation from service. All loans are due and payable when a participant receives a distribution of all of his/her account balance a/~er separation from service. The a.mount of the outstanding loan balance will be reported as a distribution in addition to the amount of cash distributed from the plan. All loans are due and payable when a participant receives +a distribution o f part of his/her account balance after separation from service. The amount of the otltstandd.ng loan balance will reported as a distribution in addition to the mount of cash distributed from the plan. PP93F E~CTIVE DATE 6/19/03 XI. REAMORTIZATION Any outstanding loan mzy be reamo~dzed. Rem-aort~zmJon rhes_ns changing the tarms of a lorn% such ~s Iength of repayment period, interest rate, and frequency of repayments. A loan may not be reamortized to extend the length of the loan repayment period to more than five (5) years from the date the loan was originally made, or in the case of a loan to secure a principal residence, beyond the number of years specified by the Employer in Section V. above. A participant must request the reamortization of a loan in writing on a reamortizadon application acceptable to the Plan Administrator. Spousal consent must accompany the request for rearnordzation when such consent is required by the plan. Upon processing the request, a new disclosure statement will be sent to the Employer for endorsemem by the pm'~dcipant and approval by the Employer. The executed lisclosure statement must be returned to the Plan Administra- tor within 10 calendar days from ~ date it is signed. Tne new d/sclosure statement ks considered an amendmantio the original promissory note, therefore a new promissory note will no[ be required. A reamortizadon will not be considered a new loan for purposes of calculating the number of loam outsumding or the one loan per calendar 1/mit Xll. REFINAlqCING EXISTING LOANS If a participant hms one outstanding loan, that loan may be refinanced. If a participant has more than one outstand- ing loan, no loans may be refinanced. Refinancing means concurrently repaying an existing loan and borrowing in additional amount through a new loan. In order to refmance an existing loan, a participant musx request a new loan in writing on an application approved by the Plan Administrator. Spousal consent must accompany the application when such consent is required by the plan. Such request must be made at a time when the participant is eligible to obtain a loan as defined by the Employer in Section III. above. The mount of a new loan requested for the purpose of refmancing is subject to the loan limits specified in Sec!ion IV. above Because a refinancing is considered a new loan, only active employees may refinance an outstanding loan. XIII. REDUCTION OF LOAN If a participant dies and leaves an outstanding loan, the unpaid loan balance will be repaid from the account baiancu before any distributions are made to a beneficiary. XIV. LOAN DEFAULT If a required payment of principal and interest is not made within 90 days of the date such payment ls due, the loan is considered in default. Ifa loan is in default, the loan will be foreclosed during the calendar year in which the participant separates from service. However, the IRS "deems" a default to be a d~stribution in the year the default occurs. Therefore, the amount of the outstanding loan at the time of the default, including accrued interest, will be reported to the IRS as a distribution in the year the default occ~s even though the loan may not be fore- closed at that time. The distribution may'be subject to taxes and possibfy a penalty for early withdrawal. If a participant has separated from service and defaults on a loan, then the loan will be foreclosed during the calendar year in which the default occurs. The amount of the outstanding loan, including accrued interest, will bl reported to the IRS as a distribution which may be subject to taxes and possibly a penalty for early withdrawal. ;' . PP93F EFFECTIVE DATE 6/19/03 [f ~Aa Employer b. as elected in Section X. a_ad ti~a promissory note so provides, ~ [0~ becomes duo and when ~ p~cipan[ scp~a~s from Sa~[c~. If ~ ~s of ~ [0~ contra ~ provision, ~ ou~a~ng loan ~ao'~[ is "d~m~d" m d~fa~t ~ of ~ dzt~ of s~p~a~on from s~ic~. ~c ~moun[ of ~ ou~ng ~o~, inc[u~ng accrued m~mst, w[iI ba m~d ~o ~ ~S ~ a d[s~bu~oa w~ch may b~ subj~c~ m mxas ~d possibly ~ pen~y for e~iy w~en ~e p~cipan~ ~ke~ ~ ~s~ibu~on of some o~ ~ of ~e b~c~ m ~s~er acCoun~ ~er ~ep~aaon ~om dia~bu~on from ~ acco~t, ~s~buUon check. ~ ~ount of ~ outst~ag [o~, including accrued ~t:rast, will ba tape.ad to ~a IRS ~ a ~s~bu~on w~ch may b~ XV. DE MINIMIS ACCOUNTS AND OUTSTANDING LOAN BALANCE If a p~Zicipant ~_~parm[es from service and the particip~mc's tot~.l vested accost b~ca, Mc[u~n~ ~a out~g 1o~ b~a, fa $~,500 ar [a~s, ~¢ P[~ will automa~c~iy foraclos~ ~e lo~. ~e ~cco~ bM~ca ram~ng ~er ~e [o~ h~ bcea saffsfied wi~ be ~sb~sed g ~ccord~c~ w[~ D~ ~s p~ovisioas ef Sacffon t0.~ of ~e PI~ If ~s occ~a, ~¢ ~o~t of ~e 1o~, ~clu~ng accrued interest, will be ~med to ~c IR~ ~ p~ of ~e ~s~b~on, wMch mzy b~ ~bj~ct to t~=s ~d possibly a p~n~ty fo~ c~ly wi~zw~. XVI. FEES Fees may be charged for vwious services aasociated with the applica~on for and issuance of loans. Ail applicable fees will be debited from the paC~.cip~t's accoung balance. A schadult of fees applicable to ~g.a Plan iS available f~om [b.e Plan kdmims~ator. XVII. OTHER The Employer baa ~e right to s~t oth~r terr~ ~d ¢ondition~ aa k deem~ neceaaary for ioan~ from the Plan in order to comply with any legal requirement. Ali tarm~ ~d con~o~ will be administered in ~ u~o~ ~d Ia V~'itn~s~ V'fb. ereo f, theEmployer hereby caused these Guidelines ~o be executed day o f EMPLOYER BY: Eric M '$'~roka, TITLE: Cir~'M~nESe~ , ATTEST:, ' .... ACCEPTED: tCMA RETIREMENT COF~POP~TiON BY: ', -TITLE: ATTEST: -. CITY OF AVENTURA FINANCE SUPPORT SERVICES DEPARTMENT MEMORANDUM TO: FROM: BY: DATE: SUBJECT: Har~ Finan~ort Services Director June 12, 2003 Resolution Allowing Loans against 457 Deferred Accounts Compensation June 19, 2003 Commission Meeting Agenda Item ~ Recommendation It is recommended that the City Commission approve the Resolution which will allow employees to borrow from their 457 Deferred Compensation Accounts. Background The regulations for 457 Deferred Compensation Accounts have changed significantly since we adopted the City's 457 program in 1996. One of the changes which will make the program more beneficial to employees is to allow loans against their account. This has no affect on the City because employees would be borrowing their own monies. I, therefore recommend approval. HMK/mn RESOLUTION NO-. 2003-.__ A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF AVENTURA, FLORIDA AUTHORIZING THE CITY MANAGER TO EXECUTE THE ATTACHED 457 PLANS LOAN GUIDELINES AND TRANSMIT SAME TO THE ICMA RETIREMENT CORPORATION; AUTHORIZING THE CITY MANAGER TO DO ALL THINGS NECESSARY TO CARRY OUT THE AIMS OF THIS RESOLUTION; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City of Aventura has employees rendering valuable services; and WHEREAS, the City of Aventura has established a deferred compensation plan for employees which serves the interest of the City by enabling it to provide reasonable retirement security for its employees, by providing increased flexibility in its personnel management system, and by assisting in the attraction and retention of competent personnel; and WHEREAS, the City Staff and City Manager have determined that permitting participants in the deferred compensation plan to take loans will serve these objectives; and WHEREAS, the City Commission, concurs with said recommendation. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF AVENTURA, FLORIDA, THAT: Section1: The City Manager is hereby authorized to execute the attached 457 Plans Loan Guidelines and to transmit same to the ICMA Retirement Corporation. Section 2: The City Manager is hereby authorized to do all things necessary to carry out the aims of this Resolution. Section 3: adoption. This Resolution shall become effective immediately upon its The foregoing resolution was offered by Commissioner moved its' adoption. The motion was seconded by Commissioner upon being put to a vote, the vote was as follows: who and Commissioner Zev Auerbach Commissioner Jay R. Beskin Commissioner Ken Cohen Commissioner Bob Diamond Commissioner Harry Holzberg Vice Mayor Manny Grossman Mayor Jeffrey M. Perlow Resolution No. 2003-__ Page 2 PASSED AND ADOPTED this 19th day of June, 2003. ATTEST: JEFFREY M. PERLOW, MAYOR TERESA M. SOROKA, CMC CITY CLERK APPROVED AS TO LEGAL SUFFICIENCY: CITY ATTORNEY 4 5 7 P / a ~ L 0 a u G u i d c I i , c s Name of Plan: CII~/ OF gVgg'ruK& I)EFgRP, EI) C0~gltSgTI0g ~ - PL/~ 304326 I. Purpose The purpose of these guidelines is to establish tine terms and conditions under which tls*, employer will grant loans to partici pants. This is the only official Loan Program Document of tbe above named Plan. II. Eligibility Loans are available to all active employees. Loans will not be granted to participants '~5/ho have an existing loan in default. Loans will be pro rated among all the funds in which the participant is invested at tbe time the loan is made. Loans are available for the following purposes: [select one] All purposes certain specified financial situations. The employer shall determine, based oil all relevant facts and circumstances, that the amount of the loan is not in excess of the amount required to relieve the financial need. For tbis purpose, financial need shall include, but not be limited to: unreimbursed medical expenses of the participant or' members of the participant's immediate fhmily, establishing or substantially rehabili~aling the principal residence nf the parlicipant, or paying for a college education (including graduate studies) [Br the participant o~ bis/bet dependents. III. Frequency of loans [select onel Participants may receive one loao per calendm' yem'. Moreover, participants may have only one outstanding loan at a time. [~[ Participants may receive one loan per calendar year. Moreover, no participant may have more tban five (5) loans outstanding at one time. ~p~rticipants may rqfinance an existing loan within the same calendar Plan year IV. Loan amount The minimum loan amount is $1,000. The maximum amount of al} loans to the participant from the plan and all other plans sponsored by the employer that are qualified employer plans under section 72(p)(4) of the Code is the lesser of: (1) $50,000, reduced by the excess (if any) of a. The highest outstanding balance of loans during the one-year period ending on the day before the date a loan is to be made, or b. The outstanding balance of loans on the date the loan is to be made; or (2) one half of the participant's vested account balance. If a participant has any loans outstanding at the time a new loan is requested, the new loan will be limited to the maximum amount calculated above reduced by the total of the outstanding loans. A loan cannot be issued for more than the above amount. The participant's requested loan amount is subject to downward adjustment without notice due to market fluctuation between the time of application and the time the loan is made. 3 ICMA RETIREMENT CORPORATION V. Length of loan A loan must be repaid in substantially equal installments of principal and interest, at least monthly, over a period that does not exceed five (5) years. Loans for a principal residence must be repaid in substantially equal installments of principal and interest, at least monthly, over no more than 10 YEARS [state number of years] years (maximum 30 years). VI. Loan repayment process Loans for active employees must be repaid through payroll deduction. Repayment will begin as soon as practicable on a date determined by the empl&yer's payroll cycle. Loans outstanding for former employees or employees on a leave of absence must be repaid on the same schedule as if payroll deductions were still being made unless they reamortize their loans and establish a new repayment schedule that provides that substantially equal payments are made at least monthly over the remaining period of the loan. All repayments must be made through the employer. Loan payments, including loan payments from former employees, are allocated to the participant' ' 's current elect~on' of invest-' ment options on file with ICMA RC. The participant may pay off all or a portion of the principal and interest early without penalty or additional fee. Extra payments are applied forward to both principal and interest as specified in the original repayment schedule, unless the additional payment is for the balance due. VII. Loan interest rate The rate of interest for loans of five (5) years or less will be based on prime plus 0.5%. The rate of interest for loans for a principal residence will be based on the FHA/VA rate. Interest rates are determined on the last business day of the month preceding the month the loan is disbursed. The interest rate is locked in at the time a loan is approved and remains constant throughout the life of the loan. The prime interest rate is determined on the last business day of each month using the Wall Street Journal as the source. The FHA/VA interest rate is also determined on the last business day of each month using the Telerate Information Service as the source. Loan interest rates for new loans may fluctuate upward or downward monthly, depending on the movement of the prime and FHA/VA interest rates. The employer may modify the manner in which loan interest rates will be determined, but only with respect to future loans. 4 5 7 P / att L 0 a II G il i d e / i , c s VIII. Loan application procedure All loans must he requested in writing on an appli0ation approw'd by the plan administrator. The application must be signed by the pai'ticipal~t.Whe employer must ~eview and approve the application. The participant will be required to sign a promissory note evidencing the loan and a disclosure statement lhat includes an amortization schedule prior to receiving a loan check. Loan d~ecks wilt generally be issued nn the Friday fbllowing the ret eipt of a complete loan application. The loan check, promissory note, disclosure statement and truth-in-lending recision notice will be sent to the employer, who will obtain the necessary signattnes and delive~ the check to the parlicipant. All execumd docu merits must be returned to the plan administrator within ] 0 calendar days h'om the date the check is issued. IX. Security/Collateral That portion of a participant's account balance that is equal to tbe amount of tile loan is uspd as collateral fbi the loan.The collateral amount may not exceed 50 percent of the participant's accnunt balance at tine time the loan is taken. Only that portion of the account-balance that corresponds to ihe amount of the outstanding loan balance is used as collateral. X. Acceleration [select oriel All loans are due and payable in full upon separation from service. All loans are due and payable when a participant receives a distribution of all of his/he~ account balance after separation from service. The amount of the outstanding loan balance will be repo~ted as a distribution in addition ~o the amount of cash distributed fi'om the plan. All loans are due and payable when a participant receives a distribution of part of his/her account balance after separation from service. The amount of the outstanding loan balance ~ill be reported as a disiribntion in addition to the amount of cash distributed from the plan. XI. Reamortization Any outstanding loan may be reamortized. Reamortization means changing the terms of a loan. such as length of repayment period, interest rate, and fl-equency of repayments. A loan may not be reamortized to extend the length of the loan repayment period to more than five (5) years fi'om the date the loan was originally made. or in the (ase of a loan to secure a principal residence, beyond the number of years specified by the employer in Section V above. A participant must request tile reamo~tization of a loan in writing on a reamortization application acceptable to tile plan administrator. Upon processing the request, a new disclosure statement will be senl 1o the employer fbr endorsemenl by the participant and approval by the employer. The executed disclosure statement must b~ returned to the plan administrato~ within 10 calendar days from the date it is signed. Tile new disclosure statement is considered an anaendment to the original p~omis- sory note, therefore a new promissory note will not be required. A reamortization will not be considered a new loan for purposes of calculating the number of loans outstat~ding el tile one loan per calendar year limit. XII. Refinancing existing loans If a participant has one outstanding loan, that loan may toe refinanced. It a participant has more than one outstanding loan, nn loans may be refinanced. Refinancing means concurrently repaying an existing loan and borrowing an additional amount through a new loan. A participant may not refinance a residential loan. In order to refinance an existing loan, a participant must request a new loan in writing on an application approved by the plan administrator. Such request must be made at a time when the participant is eligible to obtain a loan as delined by the employm in Section IH above.The amount of a new loan requested for the purpose of refinancing is subject to the loan [traits specified in Section ~V above. Because a refinancing is considered a new loan, only active employees may refinance an outstanding loan. 5 ICMA RETIREMENT CORPORATION XIII. Reduction of Loan beneficiary is responsible [bt taxes due Oll the amount He/she receives. A Form 1099 will bc issued XIV. Loan default ered in default If a loan is in defauk, the Joan x~. ill be foreclosed ctuling tile calendar yea~ in from service. If a participant has separated flora service and def~mhs on a loan. the~ the loan calendm year irt which the default occurs. if the employer has elected in Section X. and the promissory note sc) provides, a Ioa;~ bc(olll(S (ltl(, [ll/(] pa',ahh' xx hc;~ d, reported to the IRS as a disuibution that may be SLIIdect to taxes. outstanding loan amount will be considered in defaull upon issuame of tl~c dist~ibutioll check, r~ }~(' loan, including accrued interest, \~,,ill be reported to Ihe 1},}~ as a dis/Iibution Ihat nlav hc sul~ject have art existing loan in defhult will not be eligible for additional XV. Fees Fees may be charged [bt' various services associated with the application for and isst~anc-c of I<mr~s /XII applicable It,cs will of principal and interest to the participant's account. /~ schectule of fees applicable ~o this plan is available hem thc t)hm admin 'XVI. Other ][n Witness Whereof. the employer hereby caused these C, uidelines to be executed this of ,20 EMPLOYER Accepted: I(;MA RET[RFMFNT (()RP()RAIiON By: By: Title: Title: Attest: Attest: 6