2003-013 RESOLUTION NO. 2003-13
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF
AVENTURA, FLORIDA AUTHORIZING THE CITY MANAGER TO
EXECUTE THE ATTACHED REVISED ADOPTION AGREEMENT 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, in recognition of said valuable services, the City adopted Resolution
No. 96-1g establishing money purchase plans for all full time City employees; and
WHEREAS, City staff and the City Manager recommend that the contribution
percentage contained in Plan No. 9534 covering General Employees and Plan No. 9535
covering Department Directors and Assistant Department Directors be revised to reflect
a higher percentage contribution and that all plans be amended to liberalize loan
provisions contained in the Loan Guidelines; 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:
Section 1. 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 Resolution shall become effective immediately upon its
adoption.
The foregoing resolution was offered by Vice Mayor Holzberg, who moved its
adoption. The motion was seconded by Commissioner Rogers-Libert and upon being
put to a vote, the vote was as follows:
Commissioner Arthur Berger yes
Commissioner Jay R. Beskin yes
Commissioner Ken Cohen yes
Commissioner Manny Grossman yes
Commissioner Patricia Rogers-Libert yes
Vice Mayor Harry Holzberg yes
Mayor Jeffrey M. Perlow yes
Resolution No. 2003-
Page 2
PASSED AND ADOPTED THIS 4th day of February, 2003.
-,~JE'~FREY ~v~ PERLOW,~t~'OR
SUFFICIENCY:
ICMA RETIREMENT CORPORATION
PROTOTYPE MONEY PURCHASE PLAN & TRUST
REVISED ADOPTION AGREEMENT
Account Number O~ 5 -~ ~
The Employer hereby establishes'a Money Purchase Plan and Trust to be known as City o£ Avert=
Rmp I oy~ Ret irement Plan (the "Plan") in the form of the ICMA Retirement
Corporation Protowpe Money Purchase Plan and Trust.
This Plan is an amendment and restatement of an existing de£med contribution money purchase plan.
~l Yes ~l No
If yes, please specify the name of the 'defined contribution money purchase plan which this Plan
hereby amends and restates:
III.
IV.
Employer:
Prototype Sponsor:
Name:
Address:
City of Aventura
ICMA Retirement Corporation
777 N. Capitol Street, N.E..
Washington, D.C. 20002-4240
Telephone Number: (202) 962-4600
The Effective Date of the Plan shall be the first day of the Plan Year during which the
Employer adopts the Plan, unless an alzernate Effective Date is hereby specified:
Plan Year will mean:
The twelve (12) consecutive month period which coincides with the [imi~a-
~ion year. (See Section 6.05(i) of the Plan.)
The twelve (12) consecutive month pe'riod commencing on 10 / 01 . and
each anniversary thereof.
REVISED ADOPTION AGREEMENT
V.
VI.
Normal Retirement Age shall be age 5 91/2(not to exceed age 65).
ELIGIBILITY REQUIREMENTS:
1. T~e following group o~/ groups of Employees are eligible to participate in the Plan:
All Employees
All Pull-Time Employees
Salaried Employees
Non-union Employees
Management Employees
Public Safety Employees
X General Employees
Other (specify b~.low)
All employees other t~an City Manager, Department
D£rec~or$ and Assistant Department Directors.
The group specified must correspond to a group of the same designation tl-mt is defined
in the statutes, ordinances, rules, regulations, personal manuals or other material in
effect in the state or locality of the Employer.
The Employer hereby waives or reduces the requirement ora twelve (12) month
Period of Service for participation. Th.e required Period of Service shall be ~N/A
(write N/A if an Employee is eligible to participate,upon employment).
If this waiver or reduction is elected, it shal! apply to all Employees Within the
Covered Employment Classification.
A. minimum age requirement is h. ereby specified for eligibility to participate. The
minimum age requirement is N/A (not to exceed age 21. Write N/A. if no
minimum age is declared.) ·
VII. CONTRIBUTION pROVISIONS
The Employer shall contribute as follows (choose one, if applicable):
Fixed Employer Contributions With Or Without Mandatory Participant
Contributions.
) 13.5% (E~'I~CTIVE 10-1-02)
The Employer shall contribute on behalf of each Participant -1-2-~-% of
Earnings or $fl flffor the Plan Year (subject to the limitations o£ Article VI
of the Plan). Each Participant is required to contribute 0_ 0 % of Earnings
or $0. OOfor the Plan Year as a condition of participation in the Plan. (Write
"0" if no contribution is required.) If Participant Contributions are required
under this option, a Participant shall not have the right to discontinue or
vat-7 the rate of such contributions afte4'r becoming a Plan Participant.
The Employer hereby elects to "pick up" the Mandarory/P, equired Participant
Contribution.
~ Yes I~1 No
[Note to Employer: Neither an opinion letter issued by the Internal
Revenue Service with respect to the Prototype Plan, nor a determination
letter issued to an adopting Employer is a ruling by the Internal Revenue
Service that Participant contributions that are picked up by the Employer are
not incIuda, ble in the Participant's gross income for federal income tax pur-
poses. The Employer may seek such a ruling.
Picked up contributions are excludable from the ParticiPant's gross
income under section 414(h)(2) of the Internal Revenue Code of 1986 only
if they meet the requirements of Rev. Rul. 81-35, 1.98I-1 C.B. 255. Those
requirements are (1) that the Employer must specify that the contributions,
although designated as employee contributions, are being paid by the Em-
ployer in lieu of contributions by the employee; and (2) the employee must
not have the option of receiving the contributed amounts directly instead of
having them paid by the Employer to the
Fixed Employer Match of Participant Contributions.
The Employer shall contribute on behalf of each Participant % of Earn-
ings for the Plan Year (subject to the limitations of Articles V and VI of the
Plan) for each Plan Year that such Participant has contributed __% of
Earnings or $ · Under this option, there is a single, fixed rate of Em-
ployer contributions, but a Participant may decline to make r.B.e required
Participant contributions in any Plan Year, in which case~no Employer contri-
bution will be made on the Participant's behalf in that Plan Year.
Variable Employer Match Of Participant Contributions.
The Employer shall contribute on behalf of each Participan~ an amount de-
termined as follows (subject to the limirario~ of Articles V and VI of the Plan):
__% of the Participant contributions made by the Participant for
the Plan Year (not including Partic!panr contributions exceeding __% of
Earnings or $ );
PLUS % of the contributions made by the Participant for the
Plan Year in excess of those included in the above paragraph (but not includ-
ing Participant contributions exceeding in the aggregate % of Earnings
or $ .).
Employer Contributions on behalf of a Participant for a Plan Year
shall not exceed $ or __% of Earnings. whichever is [2) more or
less.
REVISED ADOPTION AGREEMENT _ _ . ................................
Each Participant may make voluntary (unmatched), after-tax contribution, subject to
the limitations of Section 4.05 and Articles V and VI of the Plan.
~ Yes (11 No
Employer contributions and Participant contributions shall be contributed to the
Trust in accordance with the following payment schedule:
Bi-weekly
VIII. EARNINGS
Earnings, as defined under Section 2.09 of the Plan, shall include:
(a). Overtime
El Yes {il No
(b) Bonuses
Yes ~ No
LIMITATION ON ALLOCATIONS
if the Employer (i) maintains or ever maintained another qualified plan in which any Par-
ticipant in this Plan is (or was) a participant or could possibly become a participant, and/or
(ii) maintains a welfare benefit fund (as defined in section 419(e) of the Code) or an indi-
vidual medical account (as defined in section 41-5(1)(2) of the Code, under which amounts
are treated as Annual Additions with respect to any Participant in this Plan) the Employer
hereby agrees to limit contributions to all such plans as provided herein, if necessary in order
to avoid excess contributions (as described ix,. Sections 6.03 and 6.04 ofdae Plan).
If the Participant is covered under another qualified defined contribution plan
maintained by the Employer, other than a Regional Prototype Plan, the provisions
of Section 6.02(a) through (0 of the Plan will apply as if tee other plan were a
Master Prototype Plan, unless another method has keen indicated below.
Other Method. (Provide the method under wh.i~h the plans will limit
total Annual Additions to the Maximum Permissible Amount, and wil[
properly reduce any excess amounts, in a manner that precludes Employer
discretion.)
If r~c Participant b or has ever been a p~rdcipant in a defined benefit
m~ ~ ~e E~l~=r, ~ ~ ~e l~imdon in ~ction &~ of
m~ ~ ~imdom g~ p~ ~ not ~de for ~ ~uc6on, or
liOn,on N ~ill ~c~ ~r ~e r~ucfion, ~I a~i~om ~l ~ r~u~d to
· e ~t n~ ~ ~e ~er d~ ~om 6.01 ~u~ 6.03. ~e
mc~s ~ mvoid~g ~e liOn,on ~ ~ ~s ~p~ ~[l nor apply if ~e
Emp~?~ ~di~ ~o~: mc~ ~low.
Other Me'od. (Nor~ ~o Employer: Provide below language which will satidy
r.b.e 1.0 limitation o£section 415(c) of the Code. Such language must
preclude Employer dLw..retion. See section 1.415-I of the Regulation for
guidance.}
3. The ILmim~ion year b the following 12-consecutive month period:
X. VESTING PROVISIONS
The Employer hereby specifies the following vesting schedule, subject to (I) the minimum
vesting requirerncnrs as noted and (2) the concurrence of the Plan Adminbrra~or.
Years of Specified Revised Percent Minimum
Service, Percent Vesting Effective Vesting
Comoleted Vesting l / 1/00 Reauiremencs**
Zero 0 %
One 0- % 20:1
Two ---ii}-- % 40:1
'I'hr~e .,, ~. 0-- % 601
Four 40 - % 80:1
Five -, ~'O--% iOOZ
Six --4Q-- % ~0oz
Seven, or mo~ I~ %
N.o minimum .
No minimum
No minimum
Not [e.~ d'mn 20%
Not !ezs'~rmn 40%
Not lei(thln 60%
Not less drmn.SO%
Muir' equal 10'0%
('*These minimum vt:sting requ!r~:ment~ conform o the ~x>cle's r_~ree To seven ye'ar vesting
schedule If the employee becor~' 1C0% ves=ed by r_Re completion of ~vc yeafi of service,
them is no minimum for years, ,tr'~ee and four.)
~ are permitted under the Plam,~avprovided in Article XIV:
i_.-- .............. '
gl Yes Ul ' ' No
REVISED ADOPTION AGREEMENT 10-z-02)
The Employer hereby arcest~ r. hat it i~ a unit of ztate or lc~al government or an agency or
instrumentality' of one or more traits me state or local government.
The Prototype Sponsor hereby agree~ to inform r. Ne Employer of any amendment~ to the
Plan made pummnt to Section 15.05 of the Plan or of the discontinuance or abandonment
of the'Plar~
The ~:~ployer hereby aFpoinm the Prototl~e Sponsor a~ the Plan Administrator pursuit to
the term~ and conditions of the ICMA RE'I-r. REMENW CORPORA~ON PROTOTYPE'
MONEY PURCHASE PLAN & TRUST.
The Employer hereby agrem to the pmvi~ions of the Plan and Trust.
XV. The Employer hereby acknowledge~ it undentand~ that failure to properly fill out this
Adoption Agreemen~ may result in di~luailflcation of the
An adopting Employer may not rely on a notification letter issued by the National or
District Office of the Internal Revenue Service a* evidence that the Plan is qualified
under section 401 of the Internal Revenue Code. In order to obtain reliance .with
respect to plan qualification, the Employer must apply to the appropriate key district
office for a determination let=er.
This Adoption Agr~ment may be used only in conjunction with bazic Plan document.
number 001.
in Wime.~ Whereof, the Employer hereb_v cause.~ this Agreement to be executed on .
this day of_ .
REVISED ADOPTION AfiREEHENT
( E~'I~CTIVE 10.1-02)
ICMA RETIREMENT CORPORATION
PROTOTYPE MONEY PURCHASE PLAN & TRUST
ADOPTION AGREEMENT
#001
REVJ. SI~D ADO~TTON AGI~RMEI~ (I~'~'~CTIVE 10-1-02)
Account Number ~. S -5~
The Employer hereby estabtishes a Money Putc.~bO~.er~d ~[ua~to be known as City of Aventur
Det?t. Director .& As sis t Dept D:kr t~ "Plan") in the form of the ICMA Retirement
Corporation Prototype Money Purchase Plan and Trust.
This Plan is an amendment and restatement of an existing defined contribution money purchase plan.
UI Yes ~ No
If yes, please specify the r~ame of the defined contribution money purchase plan which this Plan
hereby amends and restates:
III.
Employer: CITY OF AVENTURA, FLORIDA
prototype Sponsor:
Name:
Address:
ICMA Retirement Corporation
777 N. Capitol Street, N.E.
Washington, D.C. 20002-4240
Telephone Number: (202) 962-4600
The Effective Date of the Plan shall be the first day of the Plan Year during xOhich the
Employer adopts the Plan, unless an alternate Effective Date is hereby specified:
IV.
Plan Year will mean:
The twelve (12) consecutive month period which coincides with the limita-
tion year. (See Section 6.05(i) of the Plan.)
The twelve (12) consecutive month period commencing on 10/01 and
each anniversary thereof.
MPP Adoption Agreement 12/23/94
001-94
V.
Normal Retirement Age shall be ag~5 9+1/2(not to exceed age 65).
ELIGIBILITY REQUIREMENTS:
1. The following group or'groups of Employees are eligible to participate [n the Plan:
X
pepartment
Ail Employees
All Full-Time Employees
Salaried Employees
Non-union Employees
Management Employees
Public Safety Employees
General Employees
Other (specify below)
Directors and Assistant Department Directors
The.group specified must correspond to a group of the same designation that is defined
in the statutes, ordinances, rules, regulations, personal manuals or other material in
effect in the state or locality of the Employer.
The Employer hereby waives or reduces the requirement of a twelve (12) month
Period of Service for participation. The required Period of Service shall be
(write N/A if an Employe.e is eligible to participate upon employment).
If this waiver or reduction is elected, it shall apply to all. Employees within the
Covered Employment Classification.
A minimum age requirement is hereby specified for eligibility to participate. The
minimum age requirement is N/A (not to exceed age 21. Write N/A if no
minimum age is declared.)
VII. CONTRIBUTION PROVISIONS
1. The Employer shall contribute as follows (choose one, if applicable):
Fixed Employer Contributions With Or Without Mandatory Participant
Contributions.
i, 13.5% (E~'~'~CTIVE 10-1-02
The Employer shall contribute on behalf of each ParticiPant I '? (~;8 of
Earnings or $ N Dffor the Plan Year (subject to the limitations of Article VI
of the Plan). Eidh Participant is required to contribute 0.0 % of Earnings
or $ 0. N~or thePlan Year as a condition of participation in the Plan. (Write
"0" if no contribution is required.) if Participant Contributions are required
under this option, a Participant shall not have the right to discontinue or
vary the rate of such contributions after becoming a Plan Participant.
MPP Adoption Agreement 12/23/94
(EFFECTIVE 10-1-02)
The Employer hereby elecr~ to "pick up" the Mandatory/Required Participant
Contribution.
Yes ~ No
[Note to Employer: Neither an opinion letter issued by the Internal
Revenue Service with respect to the Prototype Plan, nor a determination
letter issued to an adopting Employer is a ruling by the Internal Revenue
Service that Participant contributions that are picked up by the Employer are
not includable in the Participant's gross income for federal income tax pur-
poses. Tb.e E, mpIoyer may seek such a ruling.
Picked up contributions are excludable from the Participant's gross
income under section 414 (h) (2) of the Internal Revenue Code of 1986 only
if they meet the requirements of Rev. Rul. 81-35, 1981-1 C.B. 255. Those
requirements are (1) that the Employer must specify that the contributions,
although designated as employee contributions, are being paid by the Em-
ployer in lieu of contributions by the employee; and (2) the employee must
not have the option of receiving the contributed amounts directly instead of
having them paid by the Employer to the plan.]
Fixed Employer Match of Participant Contributions.
The Employer shall contribute on behalf of each Participant % of Earn-
ings for the Plan Year (subject to the limitations of Articles V and VI of the
'Plan) for each Plan Year that such Participant has contributed __% of
Earnings or $ . Under this option, there is a single, fixed rate of Em-
ployer contributions, but a Participant may decline to make the required
Participant contributions in any Plan Year, in which case no Employer contri-
bution will be made on the Participant's behalf in that Plan Year.
Variable Employer Match Of Participant Contributions.
The Employer shall contribute on behalf of each Participant an amount de-
termined as follows (subject to the limitations of Articles V and VI of the Plan):
% of the Participant contributions made by the Participant for
the Plan Year (not including Participant contributions exceeding __% of
Earnings or $ );
PLUS __% of the contributions made by the Participant for the
Plan Year in excess of those included in the above paragraph (but not includ-
ing Participant contributions exceeding in the aggregate % of Earnings
ors ).
Employer Contributions on behalf of a Participant for a Plan Year
shall not exceed $ or __% of Earnings, whichever is [~l more or
.~l less.
MPP Adoption Agreement 12/23/94
001-94
(E~'~'5CTIVE 10-1-02)
VIII.
IX.'
Each Participant may make voluntary (unmatched), after-tax contribution, subject to
the limitations of Section 4.05 and Articles V and VI of the Plan.
Ci Yes ~2]x No
Employer contributions and Participant contributions Shall be contributed to the
Trust in accordance with the following payment schedule:
Bi-tmekl¥
EARNINGS
Earnings, as defined ~,nder Section 2.09 of the Plan, shall include:
(a) Overtime
(b) Bonuses
Yes ~l No
[21 Yes ~1 No
LIMITATION ON ALLOCATIONS
If the Employer (i~ maintains or ever maintained another qualified plan in which any Par-
ticipant in this Plan is (or was) a pamctpant or could possibly become a participant, and/or
(ii) maintains a welfare benefit fund (as defined in section 419(e) of the Code) or an indi-
vidual medical account ( as defined in section 415 (1) (2) of the Code, under which amounts
are treated as Annual Additions with respect co any Participant in this Plan) the Employer
hereby agrees to limit contributions to all such plans as provided herein, if necessary in order
to avoid excess contributions (as described in Sections 6.03 and 6.04 of the Plan).
.1.
If the Participant is covered under another qualified defined contribution plan
maintained by the Employer, other than a Regional Prototype Plan, the provisions
of Section 6.02(a) through (0 of the Plan will apply as if the other plan were a
Master Prototype Plan, unless another method .has been in&cared below.
Other Method. (Provide the method under white the plans will limit
total Annual Additions to the Maximum Permissible Amount, and will
properly reduce any excess amounts, in a manner that precludes Employer
discretion.)
(EFFECTIVE 10-1'02)
If the Participant is or has ever been a participant in a defined benefit plan main-
:aimed by the Employer, amd if the [imitation in Section 6.04 of r.b.e Plan would be
exceeded, then the Participant's Projected Annual Benefit under the defined benefit
plan shall be reduced i~ accordance with. the terms thereof to the extent necessary to
satisfy such limitation. If such plan does not provide for such reHuction, or if the
[imitation is stilt exceeded after tb.e reduction, annual additions shali be reduced to
the extent necessary in the manner described in Sections 6.01 through 6.03. The
methods of avoiding the limitation described in r.b. is paragraph will not apply if the
Employer indicates anor. her method be[ow.
Other Method. (Note to Employer: Provide below language which will satisfy
the 1.0 limitation of section 415(e) of the Code. Such language must
preclude Employer discretion. See section 1.415-I of r_b.e Regulations for
guidance.)
3. The limitation year is ~e fo[towing 12-consecutive month period:
X. VESTING PRO.VISIONS
Xt.
The Employer Hereby specifies the following vesting schedule, subject to (I) the minimum
vesting requiremenr_s as noted and (2) the concurrence of ~he Plan Administrator.
Years of Specified Minimum
Service Percent Vesting
Concreted Vesting Requirements**
Zero 100 %
One 100 %
Two I NC} %
Tb. re~ 100 %
Four 100 %
Five 100 %
Six ] ON %
Seven, or more I00 %
No minimum
No minimum
No minimum
Not tess than 20%
Not less than 40%
Not less than 60%
Not tess r_h. an 80%
Must equal I00%
(**These minimum vesting requirements conform to :b.e Code's three to seven year vesting
scb. edute. If the employee becomes 100% vested by the completion of five years of service,
there is no minimurb, for years three and four.)
Loans are permir[ed under the Plan, as provided in Article XIV:
Yes ~ No
k~pp Adoption Agreement 12/23/94
001 -94
(E~'~'gCTIVE i0-t-0.2)
XII. The Employer hereby attests r.~at [t is a unit of'state or local government or an agency or
instrumentality o£ one or more units o£ state or local government.
XIII.
The Proto~'pe Sponsor hereby agrees to inform he Employer of any amendments to the
Plan made pursuant to Section 15.05 of he Plan or of nh.e discontinuance or abandonment
of tB.e Ptan.
XIV.
The Employer hereby appoints the Prototype Sponsor as the Plan Administrator pursuant
the terms and conditions of uh.e ICMA RETIREMENT CORPORATION PROTOTYPE
MONEY PURCHASE PLAN ~& TRUST.
The Employer hereby agrees to nh.e provisions of the Plan and Trust.
XV.
XVI.
TEe Employer hereby acknowledges it understands that failure to properly fill our t~is
Adoption. Agreement may result in disqualification of the Plan.
An adopting Employer may not rely on a notification letter issued by the National or
District Office of he Internal Revenue Service as evidence that he Plan is qua[i£ied
under section 401 of' the Internal Revenue Code. In order to obtain reliance wid~
respect to plan qualification, the Employer must apply to the approprihte key district
office for a determination letter.
This Adoption Agreement may be used only in conjunction with basic Plan document
number 00I.
In Wimess Wh. ereof, the Employer hereby causes d-ti~ Agreement to be executed on
this day of , 19
EMPLOYE~k.-'~'
Title: Corporate ec ary
LOAN GUIDELINES
REVISED AS OF FEBRUARY 4, 2003
NAME OF PLAN: . CITY 0F AVENTUP. k
EMPLOYEES' RETIREMENT PLAN
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 are available to all active employees. Loans will not be granted to participants who have an existing loan
in default.
Loans 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 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 part/cipant is invested at the time the loan is made.
Loans are available for the following purposes: [select one]
--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 determine, based on all
relevant facts and circumstances, that the amount of the loan is not in excess of the amount reqdired
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 substantially rehabilitating the principal residence of the participant, or paying for a
college education (inchiding graduate studies) for the participant or his/her dependents.
III. FREQUENCY OF LOANS
[select one]
Participants 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 participant may have more than
five (5) loans outstanding at one time.
IV. LOAN AMOUNT
The mLr~mum loan amount is $1,000.
The max/mum loan amount is:
(EFFECTIVE 2-4-03
the lesser of:
(2)
$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, over
b. The outstar~ding balance of loans on the date the loan is to be made; or
1/2 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 amouht calculated above reduced by the total of the outstanding loans.
V. LENGTH OF LOAN
.A lo~m 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, oyer no more than I 0 [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 determined by the Employer's payroll cycle.
Loans outstanding for former employees who are allowed under Section X. to maintain their ioaris 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. Ail repayments
must be made through the Employer.
Loan payments, including loan payments from former employees, are allocated to the same investment options
designated on the 401 EnrolLment Form or according 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 prime plus 0.5 %.
The rate of interest for loans for a principal residence will be based on the FHA/VA rate.
Interest rates arc determined on thc 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 rem ~in¢ 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.
PP93F
(EFFECTIVE 2-4-03
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 oniy with respect to
future loans.
VIII. LOAN APPLICATION PROCEDURE
All 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 ttme of applicatmn, 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-
sentalive or notary public. Such consent must be given within the ninety (90) day period before the 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
ai~d 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 documents must be returned to the Plan Administrator within 10
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 amount 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_th~
-.loan is taken. Only that portion of the vested account balance that corresponds tothe mount of the outstanding
loan balance is used as collateral.
X.' ACCELERATION
[select one]
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/her account
balance after separation from service. The amount 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 of part of his/her account
balance after separation from service. The amount of the o~ttstanding loan balance will reported as a
distribution in addition to the amount of cash distributed from the plan.
P~93F
( EFFECTIVE 2-4-03 '
Xl. REAMORTIZATION
Any outstanding loan may be reamortized. Rearnorrization means changing the terms of a loan, such as length of
repayment period, interest rate, and fi:equency 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 reamordzation 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 mqnired by the
plan. Upon processing the request, a new disclosure statement will be sent to the Employer for endorsement by the
participant and approva/by the Employer. The executed disclosure statement must be returned to the Plan Administra-.
tot 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 will not be required.
A reamortizati0n will not be considered a new loan for purposes of calculating the number of loans outstanding 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-
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
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 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. RFDUCTION 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 principai and interest is not made within 90 days of the date such payment fs 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 outstanding loan at the time of the default, including accrued interest,
wilI 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 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 distribution which may be subject to taxes and possibly a penalty for early withdrawal.
PP93F
(EFFECTIVE 2-4-03 ' )
If the Employer has elected in Section X. and the promissory note so provides, a loan becomes due and payable
when Lhe participant sep~ates from service. If the terms of the loem contort this provision, the outstanding loan
amount is "deemed" in default as of the d~e of separation from service. The s-mount of the outstanding loan,
including accrued interest, will be reported to the FRS as a distribution which may be subject to taxes and possibly
a penalty for early withdrawal.
If the Employer has so elected in Section X. and the promissory note so provides, a loan becomes due and payable
when the participant takes a distribution of some or ali of the balance in Ms/her account after separation from
service. If the terms of the loans cuntnin such a provision and the outstanding loan balance is not paid prior to the
distribution from the account, the outstanding loan amount will be considered, in default upon issuance of the
distribution check. The amount of the outstanding loan, including accrued interest, will be reported to the IRS
as a distribution which may be subject to taxes and possibly a permlty for early withdrawal.
XV. DE M!NIMIS ACCOUNTS AND OUTSTANDING LOAN BALANCE
If a participant separates from service and the participant's total vested account balance, including the outstanding
loan balance, is $3,500 or less, the Plan will automatically foreclose the loan. The account balance remaining aRer
the loan has been-satisfied wiI1 be disbursed in accordance with De Minimis provisions of Sect/un 10.04 of the
Plan. If this occurs, the mount of the loan, including accrued interest, will be reported to the IRS as par[ of the
distribution, which may be subject to taxes and possibly a penalty for early withdrawal.
XVI. FEES
Fees may be charged for various services associated with the application for and issuance of loans. Ali applicable
fees will be debited Rom the participant's account balance. A schedule of fees applicable to this Plan is avallable
from the Plan Administrator.
XVll. OTHER
TlSe Employer has the right to set other terms and conditions as it deems necessary for loans from thc Plan in
order to comply with any legal requirement& All terms and conditions will be administered in a uniform and
non-discriminatory manner.
In Witness Whereof, the Employe~' hereby caused these Guidelines to be executed this
day of
EMPLOYER
BY:
Eric ~ $oroka
TITLE: C'~ ty
ATTEST:
ACCEPTE,I~ I~,. RETIRF_.~ENT CORPORATION'
~ ,,.
FEB Z 5 2003
PP93F
LOAN GUIDELINES
REVISED AS OF FEBRUARY 4, 2003
NAME OF PLAN: CITY OF AVENTURA
DEPARTMENT DIRECTORS AND ASSISTANTS DIRECTORS RETIREi~ENT PLAN
I. PURPOSE
The purpose of these guidelines is to establish the terms and conditions under which the Employer wiI1 grant
loans to participants. This is the only official Loan Program Document of the above named Plan.
II. ELIGIBILITY
Loans are available to ail active employees. Loams will not be granted to participants who have an existing loan
in default.
Loans we 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 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 avallable 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 ~hall determine, based 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 include, but not be limited to:
unreimbursed medical expenses of the participant or members of the participant's immediate family,
estabhshing or substantially.rehabilitating the principal residence of the participant, or paying for a
college education (including graduate studies) for the participant or his/her dependents.
III. FREQUENCY OF LOANS
[select one]
Participants 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 participant may have more than
five (5) loans outstanding at one time.
PP93F
IV. LOAN AMOUNT
Tlie m~nimum loan amount is $I,000.
The maximum loan .amount is:
thc lesser of:
(1)
(2)
$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, over
b, The outstanding balance of loans on the date the loan is to be made; or
1/2 of the participant's vested account baiance.
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.
V. LENGTH OF LOAN
A'loan must be repaid in substantially equal installments of principal and interest, at least monthly, over a period
/hat does not exceed five (5) years.
Loans for a principal residence must bc repaid in substantially equal installments of principal and interest, at least
monthly, over no more th~t~ , '] 0 [state number of years] years (maximum 30 years).
VI. LOAN REPAYMENT PROCESS
Loans for active employees must be repaid through payroll deducfior~ Repayment will begin as soon as practi-
cable on a date determined by the Employers payroll cycle.
Loans outstanding for former employees who are a/lowed 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. All repayments
must be made through the Employer.
Loan payments, including loan payments from former employees, are allocated to line same investment, options
designated on the 401 Enrollment Form or according 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 iess 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 loar~
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.
PP93F
(EFFECTIVE 2_-4-03 )
Loan interest rates for new loans may fluctuate upward or downward monthly, depending on the movement of the
prime mad 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.
VIII. LOAN APPLICATION PROCEDURE
All 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 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
md troth-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 document~ must be returned to the Plan Administrator within 10
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 amount of the loan is used ms collateral
for the loan. The collateral mount may not exceed 50% of the participant's vested account balance at the time 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 payable in full upon separation from service.
Al1 loans are due and payable when a participant receives a distribution of all of his/her account
balance at~er separation from service. The amount of the outstanding Ioan balance will be reported as
a distribution in addition to the amount of cash distributed firom 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 will reported a~ a
distribution in addition to the amount of cash distributed from the plan.
PP93F
(EFFECTIVE 2-4-03 )
Xl, REAMORTIZATION
Any outstanding loan may be reamorLized. Reamortizat/on mea. m changing the terms of a loan, 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
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 appl/cation acceptable to ~ae 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 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 will not be required.
A reamort/zation will not be considered a new loan for purposes of calculating the number of loans outstanding or the
one loan per calendar limit
XII. REFINANCING EXISTING LOANS
If a participant has one outstanding loan, that loan may be retlnanced. ]fa participant has 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
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 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 }oa.m
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 such payment }s 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 th,, w~ th,
erault occurs. Therefore, the amount of the outstanding loan at the rime of the default, including accraed 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 possibly a penalty for early withdrawal.
If a participant has separated from service and defaults on a loan, then thc loan will be foreclosed during the
calendar year in which the default occurs. The amount of the outstanding ioar~, including accrued interest, will b~
reported to the IRS as a distribution which may be subject to taXes and possibly a penalty for early withdrawal.
' . PP93F
2-4-03 )
If the Employer has elected in Section X. and the promissory note so provides, a loan becomes due and payable
when the pm-ticipant separates from serViCe. If the terms of the loan contain this provision, the outstanding loan
mount is "deemed" in d~fault as of the date of separation from service. Th~ a_mou-ut of th~ outstanding loan,
L, xcluding accrued interest, will be repormd to the [KS as a distribution wh~ch may be subject to taxes and possibly
a penalty for early withdrawal.
elected in Section X. and the promissory note so provides, a loan becomeS due and payable
If the Employer hms so ' not paid ptior to the
when the pm-ticipant takes a distribution of some or ail of the b~lance in hisf~er ~count ~fter separation from
service. If the terms of the loans contain such ~ provision and the outstanding loan baiance ~sof the
distribution from the accoufi~, the outstanding loan ~mou~t will be considered m default upon ~ssuanct;th
dist~ibutior~ check. The mount of the outSt~ding lo~n, including accrued interest, will be r~ported
~s a distribution which may be subject to taxes md possibly a penait,y for e~ly withdrawal.
XV. DE MINt_MIS ACCOUNTS AND OUTSTANDING LOAN BALANCE
If a participant sumparates from serViCe and the participant's total vested account balmce, including the outstanding
loan balance, is $3,500 or less, the Plan will automaticallY foreclose the loan. The account baiance remaining after
the loan has been'satisfied witl be disburse6 m accordance with De MimnuS proWmons of Secuon 10.04 of the
· . · will be repormd tq the IP, S as part of the
pl~Lr~ If this occurs, the amount of the loan, including ~ccrued interest,early withdrawai.
distribution, which may be subject to taxes and possibly a permlty for
XVI. ~EES
Fees may be charged for various services mssociated with the application for and issuance of ~.oanS. All applicable
fees will be debited from the participant's account balance. A schedule of fees applicable to this Plan is ayM.lable
from the Plan Administrator.
XVII. OTHER
The Employer has the r~ght to set other terms and conditions ~s it d~¢ms n¢ceSsm'y for kozus from the Plan ha
order to comply with any legal requirements. All terms and conditions will be administered in a unifann and
non.discriminatory
In Witness Whereof, the Employer hereby caused these Guldeliues to be executed this __ ..day of _, ~9~.
EMPLOYER
TiTLe:
A'T-I'EST:(
03 )
LOAN GUIDELINES ·
P. EVISED AS OF FEBRUARY 4, 2003
NAME OF PLAN: C. TTV ~3F AVFNTIIRA
CITY MANAGER RETIREMENT PLAN
I. PURPOSE
The purpose of these guidelines is to establish the terms and conditions under which the Employer will grant
loans to participants. Tiffs is the only official Loan Program Document of the above named Plan.
II. ELIGIBILITY
Loans are available to ali active employees. Loans will not be granted to participants who have an existing loan
in default.
Loans 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 Rollover, and Portable Benefits Accounts, but excluding the Deduct-
ible Employee ContributiordQualified 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 available for the following purposes: [select one]
All purposes
}fSI---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 determine, bmsed on ail
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 include, but not be limited to:
unrehnbursed medical expenses of the participant 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 participant or his/her dependents.
Ill. FREQUENCY OF LOANS
[select one]
Participants may receive one loanper calendar year. 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 than
five (5) loans outstanding at one time.
PP93F
(EFFECTIVE 2-~-0~ ~
IV. LOAN AMOUNT
The minimum loan amount is $1,0130.
The maximum loan remount is:
the lesser of:
(1)
(2)
$50,000, mdaced by the excess (if any) of:
The highest outstanding balance of loans during the one-year period ending on
the day before the da~e a loan is to be marie, over
b. The outstanding balance of loans on the date the loan is to be made; or
1/2 of the participant's vested account balance.
If a participant has any loans outstanding at the time a new loan is requested, thc new loan will be limited to the
maximum amount calculated above reduced by the total of thc outstanding loans.
V. LENGTH OF LOAN
A loan must be repaid in substantially equal instal/ment~ of principal and interest, at least monthly, over a period
that does not exceed five (~) years.
Loans for a principal residence must be repaid in substantially equal installments of principal and interest, at least
monthly, over no more than T 13 [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 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 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 payments, including 10an payments from former employees, are allocated to the same investrnent-oVdons
designated on the 401 Enrollment Form or according 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 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 thc life of the loan.
The prkmc interest rate is determined on the last business day of each month using thc 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.
(E~'~'gCTIVEi 2~-4~03 )
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 rams will be determined, but only with respect to
future loans.
VIII. LOAN APPLICATION PROCEDURE
All 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-
sentadve or notary public. Such consent must be given within the ninety (90) day period before the 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 applicatior~ The loan check, promissory note, disclosure statement
ahd truth-in-lending recision notice will 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 10
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 amount 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 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]
.C1 All loans are due and payable in full upon separation from service.
Ail loans are due and payable when a participant receives a distribution of all of his/her account
balance after separation from service. The amount 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 of part of his/her account
balance after separation from service. The amount of the oO. tstanding loan balance will reported as a
distribution in addition to the amount of cash distributed from the plan.
PP93F
(EYFECTIVE .. -
XI. REAMORTIZATION
Any outstanding loan may be reamofdzad. Reamortization means changing the terms of a loan, such as length of
repayment period, interest rote, and frequency of repayments. A loan may not be reamorthed 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 ora
loan to secure a principal residence, beyond the number of years specified by the Employer in Section V. above.
A participant must request the reamorfization of a loan in writing on a rearnortization application acceptable to the Plan
Administrator. Spousal consent must accompany the request for mamortization 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 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 will not be required.
A reamorazation will not be considered a new loan for purposes of calculating the number of loans outstanding or the
one loan per calendar limit
2
XII. REFINANCING EXISTING LOANS
If a participant has one outstanding loan, that loan may be refinanced. If a participant has more than one outstand-
i.ng loan, no loans may be refinanced. Refinancing means concurrently repaying an existing 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 an application approved
by the Plan Administrator. Spousal consent must accompany the application when such consent is reqnlred 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 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 loam
Xlll. REDUCTION OF LOAN
If a participant dies and leaves an outstanding loan, the unpaid loan balance wiI1 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-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 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 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 distribution which may be subject to taxes and possibly a penalty for early withdrawal.
PP93F
(E~'~CTIVE 2-4-03 )
If the Employ'er has elected in Section X. and the promissory note so pr6vides, a loan becomes due and payable
when the participant separates from service. If the terms of the loan contain this provision, the outstanding loan
mount is "deemed" in defatdt as of the date of separation from service. The amount of the outstanding loan,
including accrued inter.t, will be reported to the IRS as a distribution which may be subject to taxes and possibly
a penalty for early withdrawal.
If the Employer has so elected in Section X. a~ud the promissory note so provides, a loan becomes due and payable
when the participant takes a distribution of some or all of the balance in his/her account aider separation from
service. If the terms of the loans contain such a provision and the outstxuding loan balance is not paid prior to the
distribution from the account, the outstanding loan mount will be considered in default upon issuance oft_he
· distribution check. The amount of the outstanding loan, including accrued interest, will be reported to the IRS
as a distribution which may be subject to taxes and possibly a penalty for early withdrawal.
XV, DE MINIMIS ACCOUNTS AND OUTSTANDING LOAN BALANCE
If a participant s_eparates from service and the participant's total vested account balance, including the outstanding
loan balance, is $3,500 or less, the Plan will automatically foreclose the loan. The account balance remaining after
the loan has been satisfied will be disbursed in accordance with De Minimis provisions of Section I0.04 of the
Plan. If this occurs, the amount of the loan, including accrued interest, will be reported to the IRS as part of the
distribution, which may be subject to taxes and possibly a penalty for early withdrawal.
XVI. FEES
Fees may be charged for various services associated with the application for and issuance of loans. All applicable
fees wiI1 be debited from the participant's account balance. A schedule of fees applicable to this Plan is available
from the Plan Admin/strator.
XVII. OTHER
The Employer has the right to set other terms and conditions as it deems necessary for loans from the Plan in
order to comply with any legal requirements. All terms and conditions will be admLuistered in a uniform and
non-discriminatory manner.
In Witness Whereof, the Employer hereby caused these Guidelines to be executed this
,19
day'of
EMPLOYER
BY: __ ~- '
Eric ~ $oroka,
TITLE:
AC C EPTE D :AI~M/~RETI R EM ENT CORPORATION
ti'FEB 25 2003
PP93F