Loading...
HomeMy WebLinkAboutD-873 Employee Deferred Compensation Plan ORDINANCE NO. AN ORDINANCE OF THE COMMON COUNCIL OF THE CITY OF CARMEL, INDIANA, AMENDING CHAPTER 2, ARTICLE 1, SECTION 2 -56 OF THE CARMEL CITY CODE WHEREAS, the Common Council of the City of Carmel, Indiana, upon study of the deferred compensation plan currently in existence, desires to repeal the existing deferred compensation Ordinance in its entirety in Chapter 2, Article 1, Section 2 -56 of the Carmel City Code, and replace said Ordinance with the following comprehensive deferred compensation plan ordinance. NOW THEREFORE IT BE ORDAINED BY THE COMMON COUNCIL OF THE CITY OF CARMEL, INDIANA, AS FOLLOWS: Section 2 -56 of the Carmel City Code is hereby repealed in its entirety and replaced with the following: SECTION 1. 2 -56. The City of Carmel Deferred Compensation Plan for all eligible City employees is hereby established. (A) Definitions. For purposes of this Section the following words shall have the meanings herein stated: (1) "deferred compensation" shall mean the amount of compensation reduced and deferred pursuant to a deferred compensation agreement. (2) "deferred compensation plan" shall mean any plan established pursuant to Section 2 -56 or any plan established under an ordinance which preceded revised Section 2 -56. (3) "deferred compensation account" shall mean the account established for each employee who has entered into a deferred compensation agreement and into which the compensation he /she has deferred shall be credited. (4) "deferred compensation agreement" shall mean that agreement, the general terms of which are set forth in Section 2- 56(D), entered into between the employer and an eligible employee as defined by Section 2- 56(C). (5) "employee" shall mean any person actively employed (including elected or appointed officials) by the City of Carmel, Indiana. (6) "employer" shall mean the City of Carmel, Indiana. (B) Deferred Compensation Plan Authorized. Subject to Common Council approval of each plan, the employer is hereby authorized to establish and administer one or more deferred compensation plans for eligible employees as provided in this Section or pursuant to IND. CODE §5- 10- 1.1 -7. Such deferred compensation plans may be amended from time to time after proposed amendments are submitted and approved by the Council. Any amendment to an existing plan or the adoption of a new plan shall not invalidate any employee's previous deferral of compensation and any income attributable to the amounts deferred. (C) Employee Eligibility. Any permanent full -time or permanent part -time employee will be eligible to participate in the deferred compensation plan provided the employee has entered into a properly executed deferred compensation agreement. (D) Required Terms of Agreement. The deferred compensation agreement specified in Section 2- 56(A)(4) shall be executed by the eligible employee and by the employer or by any party authorized to execute such agreements on behalf of the employer and shall contain the following provisions: (1) The eligible employee shall agree that the salary or other total compensation, authorized by statute, Ordinance or the responsible salary administrator or the position held by such employee, shall be reduced by at least $25 per month and the amount shall be credited to the employee's deferred compensation account. (2) The employer and eligible employee shall mutually agree that the amount of deferred compensation shall be paid as set forth in the deferred compensation plan. (3) The eligible employee shall agree that the deferred compensation account shall be the absolute property of the employer, and the employee shall have no rights to that account except as set forth in the deferred compensation plan. (4) The eligible employee shall agree that he /she will: (a) change his /her election to participate, (b) amend the amount of compensation to be deferred, (c) change his /her specification for investment selection, or (d) change the payment option selected for the payment of benefits, only as provided for in the deferred compensation plan. (5) The employer shall agree that the eligible employee may, subject to the terms of the deferred compensation plan, designate a beneficiary who, in the event of the death of such employee, shall be paid the full value of the employees deferred compensation account. (6) The City of Carmel shall make a non elective contribution to the deferred compensation plan on behalf of all eligible Carmel Police Department sworn officers whereby the City will remit to the deferred compensation plan the lesser of (1) an amount equal to the amount which the City would remit to the Internal Revenue Service for social security tax (not including any applicable medicare portion of the FICA withholdings if that portion must still must be remitted to the IRS), representing the employer portion of such tax, if the employees were subject to such tax and (2) the annual limit on such contributions as provided in Section 457 of the Internal Revenue Code of 1986, as amended. Any such non elective contribution made by the City under this subsection shall be known as a "Police Retirement Benefit Program" contribution and shall be invested only in the approved investment options which are included in the deferred compensation plan. Neither the existence of a deferred compensation agreement nor any of its provisions shall be construed to confer upon the employee any right to continue his /her employment for any specific period or at any particular rate of compensation. Any deferred compensation specified in such agreement shall accrue and be payable only as set forth in the deferred compensation plan. (E) Management of Deferred Compensation Accounts. All deferred compensation accounts established pursuant to this Section shall be invested pursuant to the terms of the deferred compensation plan and may be invested in either group fixed or group variable annuity contracts. (F) Administration. Each deferred compensation plan shall be administered as provided for in the deferred compensation plan document for that plan and any amendments thereto. Such documents may allow the employer, or his /her authorized representative, to enter into an agreement with, or to contract with, one or more third parties to provide administrative services for each deferred compensation plan. (G) Plan Approval. The Common Council approves the following plans for the City of Carmel Deferred Compensation Plan, submitted contemporaneously herewith, and attached to this Ordinance. United States Conference of Mayors Deferred Compensation Plan Deferred Compensation Plan for Public Employees Civilian (Exhibit "A dated March 19, 1990 Deferred Compensation Plan for Public Employees Police Department (Exhibit "B dated Lincoln National Deferred Compensation Plan of the City of Carmel (Exhibit "C dated May 15, 1988 SECTION 2. All prior Ordinances, resolutions or parts thereof inconsistent with any provision of this Ordinance are hereby repealed. SECTION 3. This Ordinance shall be in full force and effect from and after its passage and signing by the Mayor. PASSED BY THE COMMON COUNCIL OF THE CITY OF CARMEL, INDIANA THIS °7" DAY OF fig. 4. X993 J -4 Presiding •ffi er ATTES i a—cJ /9q3 :usan W. Jones, Clerk/74 surer Dated: day of 1992- RESENTED by me to the Mayor of the City of Carmel, Indiana on the day of 1993. By: ed Johnsen, Mayor, City of Car I el, Indiana ATTEST: SU"san W. Jones, Clerk easurer ExHIT3 feeSeAVC441 Ot UNITED STATES CONFERENCE OF MAYORS DEFERRED COMPENSATION PROGRAM THE DEFERRED COMPENSATION PLAN FOR PUBLIC EMPLOYEES PLAN DOCUMENT r U C/ e ;-7 Ce1 rP)'''' I r NAME OF CITY JA N 1 0 1991 The Plan consists of the provisions set forth in this document, and is applicable to each Public Employee who elects to participate in the Plan. The Plan is effective as to each such Public Employee upon the date he becomes a "PARTICIPANT" by signing and filing with the Administrator the Par- ticipation Agreement referred to herein. ARTICLE 1 Definitions 1.01. The following terms shall, for purposes of this Plan, have the meaning set forth below. (a) ADMINISTRATOR means the person, department, agency or organization appointed by the EMPLOYER to administer the Plan. (b) BENEFICIARY means the person properly designated by a PARTICIPANT to receive the PARTICIPANT'S benefit under this Plan. (c) COMPENSATION means all payments made by the EMPLOYER as remuneration for ser- vices rendered, including salaries, fees, etc. (d) EMPLOYER means the above referenced city or any of its agencies, departments, sub- divisions or instrumentalities for which services are performed by a PARTICIPANT. (e) INCLUDIBLE COMPENSATION means, for the purposes of the limitations on deferrals, compensation for services performed for the EMPLOYER which is currently includible in gross income after giving effect to all provisions of the IRC. The amount of Includible Compensation shall be determined without regard to any community property laws. (f) INDEPENDENT CONTRACTOR means any person receiving any type of compensation from the EMPLOYER or any of its agencies, departments, subdivisions or instrumentalities for which services are rendered pursuant to one or more written or oral contracts, if such person is not an employee. (g) IRC means the Internal Revenue Code of 1986, as now in effect or as hereafter amended. (h) NORMAL RETIREMENT AGE means the age specified in writing by the PARTICIPANT. If the EMPLOYER has an EMPLOYER'S Retirement System, the Normal Retirement Age specified by the PARTICIPANT must be an age at which the PARTICIPANT is eligible to retire pursuant to the EMPLOYER'S Retirement System, by virtue of age. length of ser- vice, or both, without consent of the EMPLOYER and with the right to receive immediate retirement benefits without actuarial or similar reduction because of retirement before some later specified age. In no event shall Normal Retirement Age be later than age 70 1/2. (1) PARTICIPANT means any Public Employee who is eligible to defer Compensation under the Plan and who participates under this Plan by signing the Participation Agreement. (j) PARTICIPATION AGREEMENT means the application to the Administrator to participate In the Plan. 0C -549 -B C8 --89y pearls+ 4 (k) PLAN means tfeferred Compensation Plan For Pub1i• p to y ees as set forth in this document and as it may be amended from time to time. (I) PLAN YEAR means the calendar year in which the Plan becomes effective, and each succeeding calendar year during the existence of this Plan. (m) PUBLIC EMPLOYEE means any person who receives any type of compensation from the EMPLOYER for which services are rendered (including, but not limited to, elected or appointed officials, salaried employees, and independent contractors). (n) SEPARATION FROM SERVICE means Separation From Service as defined in IRC Section 402(e)(4)(A)(iii), and on account of the PARTICIPANT'S death or retirement. An Independent Contractor shall not be considered Separated From Service with the EMPLOYER and shall not receive any benefits hereunder unless (1) at least 12 months have expired since the date on which the last contract, pursuant to which the Independent Contractor provided any services to the EMPLOYER, was terminated, and (2) the Independent Contractor has performed no services for the EMPLOYER during the 12-month period referred to herein either as an Independent Contractor or employee. (o) UNFORESEEABLE EMERGENCY means severe financial hardship to the PARTICIPANT resulting from a sudden and unexpected illness or accident of the PARTICIPANT or a dependent (as defined in IRC Section 152(a)) of the PARTICIPANT, loss of the PARTICIPANT'S property due to casualty, or other similar or extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the PARTICIPANT. ARTICLE II Election to Defer Compensation 2.01. The PARTICIPANT may elect to participate by signing the Participation Agreement and consenting to a reduction of salary by the deferral amount specified in the Participation Agreement. The amount of the reduction "deferred amount must equal at least $20 per month. 2.02. The EMPLOYER shall commence the reduction no earlier than the first pay period com- mencing during the first month after the date on which the Participation Agreement is filed with the Administrator. 2.03. (a) The PARTICIPANT may revoke his election to participate and may amend the amount of Compensation to be deferred by signing and filing with the Administrator a written revocation or amendment on a form and in the procedural manner approved by the Administrator. In addition, the PARTICIPANT may amend his investment specification in the procedural manner approved by the Administrator. Any amendment which increases the amount deferred for any pay period shall be effective only if an agreement providing for such additional deferred amount is entered into before the beginning of the month in which the pay period commences. Any revocation or amendment of the amount deferred shall be effective prospectively only. Any change in the PARTICIPANT'S investment specification by the PARTICIPANT, whether it applies to amounts previously deferred or amounts to be deferred in the future, shall be effective prospectively only and shall be effective on a date consistent with the rules and specifications of the investment carrier. (b) After the death of the PARTICIPANT, his Beneficiary shall have the right to amend the PARTICIPANT'S, or the Beneficiary's own, investment specification by signing and filing with the Administrator a written amendment on a form and in the procedural manner approved by the Administrator. Any change in an investment specification by a Beneficiary shall be effective on a date consistent with the rules and specifications of the investment carrier. The right of a Benefi- ciary to arnehd'an investment specification shall terminate on the last day available for an election concerning the mode of payment pursuant to Section 8.03 below. Notice to ALL PARTICIPANTS to Read These Provisions Providing Deferral Limitations and "Catch- up" Deferrals Under the Plan. 2.04. Except as provided in Section 2.05, the maximum deferred amount under the Plan for the PARTICIPANT'S taxable year shall not exceed the lesser of (a) $7,500 or (b) 33 1/3 of the PAR- TICIPANT'S Includible Compensation as provided in IRC Section 457. Page 2 DC -549 -B (8 -89) For one or more or the PARTICIPANT'S last 3 taxable years ending before the attainment 2.05. Fo o Y 9 of Normal Retirement Age under the Plan, the maximum deferral shall be the lesser of: (a)$15,000 or (b) the limitation established for the taxable year under Section 2.04, plus the limitation established for purposes of Section 2.04 for prior taxable years beginning after December 31, 1978, during which the PARTICIPANT was eligible to participate less the amount of Compensation deferred under the Plan for such prior taxable years. 206. In applying the deferral limitations of Sections 2.04 and 2.05, any amounts excluded from the PARTICIPANT'S gross ificome for the taxable year under IRC Section 403(b), and, effective January 1, 1989, under IRC Sections 402(a)(8) and 402(h)(1)(8) and deductible contributions to an organization described in IRC Section 501(c)(18), shall be treated as amounts deferred as provided in IRC Section 457(c). ARTICLE III EMPLOYER Contributions LThe:'EMPLOYER''maycontribute to the Plan for EMPLOYER contributions shallW Evest;at ttie. time such contributions are made: f,,.: ct For, purposes of administering Seions 2 04'andu''; X2 EMPLOYER, contributions, shall apply toward the maximum defer aI Iimits'irr the Plan =rYeaG that- such contributions are made. ARTICLE IV Plan Transfers 4.01. If a PARTICIPANT terminates employment with the EMPLOYER and accepts employment with another employer which maintains an eligible deferred compensation plan (as defined in IRC Section 457) and the new employer's plan accepts transfers, the PARTICIPANT may transfer his account balance from the Plan to the plan maintained by the new employer. 4.02. Transfers from other eligible deferred compensation plans (as defined in IRC Section 457) to the Plan will be accepted at the PARTICIPANT'S request if such transfers are in cash or non- annuity products currently offered under the Plan. Any such transferred amount shall not be subject to the limitations of Section 2.04, provided, however, that the actual amount deferred during the calendar year under both plans shall be taken into account in calculating the deferral limitation for that year. For purposes of determining the limitation set forth in Section 2.05, years of eligibility to participate in the prior plan and deferrals under that plan shall be considered. ARTICLE V Designation of Beneficiary The PARTICIPANT shall have the right to file, with the Administrator, a written Beneficiary or change of Beneficiary form designating the person or persons who shall receive the benefits payable under this Plan in the event of the PARTICIPANT'S death. The form for this purpose shall be provided by the Administrator and will have no effect until it is signed, filed with the Administrator by the PARTICIPANT, and accepted by the Administrator. If the PARTICIPANT dies without having a Beneficiary form on file, the benefits will be paid to the PARTICIPANT'S estate. The PARTICIPANT accepts and acknowledges that he has the burden for executing and filing with the Administrator a proper Beneficiary designation form. ARTICLE VI Accounts and Reports 6.01. THE EMPLOYER shall remit the amounts deferred to the Administrator or his designated agent. The Administrator shall have no duty to determine whether the funds paid to him by the EMPLOYER are correct, nor to collect or enforce such payment. 6.02. For convenience and to facilitate an orderly administration of the Plan, the Administrator shall maintain a deferred account with respect to each PARTICIPANT. A written report of the status of the PARTICIPANT'S deferred account shall be furnished at least annually and within ninety (90) days after the end of each calendar year to the PARTICIPANT. DC -549 -8 (8 -89) Pao 3 6.03. Within ninety (9ys after the end of the calendar year° Administrator shall file with the EMPLOYER a written report of the assets of the Plan, a schedule of all receipts and disburse- ments, and a report of all material transactions of the Plan during the preceding year. 6.04. The Administrator's records shall be open to inspection during normal business hours by the EMPLOYER or any PARTICIPANT, or their designated representatives. 6.05. All reports to the PARTICIPANT shall be based on fair market value as of the reporting date. ARTICLE VII Investment of Deterred Amount 7.01. The deferred amounts shall be delivered by the EMPLOYER to the Administrator or his designated agent for investment as designated by the EMPLOYER. 7.02. The EMPLOYER shall use the PARTICIPANT'S or Beneficiary's investment specifications so as to determine the value of the deferred account maintained with respect to the PARTICIPANT as if the deferred amounts had been invested according to such specifications. The EMPLOYER shall be under no obligation to invest the deferred amounts as specified by the PARTICIPANT or Beneficiary. 7.03. All interest, dividends, charges for premiums and administrative expenses, and changes in value due to market fluctuations applicable to each PARTICIPANT'S deferred account shall be credited or debited to the account as they occur. 7.04. All assets of the Plan, including all deferred amounts, property and rights purchased with deferred amounts, and all income attributable to such deferred amounts, property or rights, shall remain (until made available to the PARTICIPANT or Beneficiary) solely the property and rights of the EMPLOYER (without being restricted to the provision of benefits under the Plan), subject only to the claims of creditors of the EMPLOYER. Contracts and other evidences of the investments of all assets under this Plan shall be registered in the name of the EMPLOYER which shall be the owner and beneficiary thereof. The rights of the PARTICIPANT created by this Plan shall be those of a general creditor of the EMPLOYER, and in an amount equal to the fair market value of the deferred account maintained with respect to the PARTICIPANT. The PARTICIPANT acknowledges that his rights are no greater than those of a general creditor of the EMPLOYER and that in any suit for an accounting, to impose a constructive trust, or to recover any sum under this Plan, the PARTICIPANT'S rights are limited to those of a general creditor of the EMPLOYER. The EMPLOYER acknowledges that the Administrator is the agent of the EMPLOYER. ARTICLE VIII Benefits 8.01. Commencement of Distributions: The PARTICIPANT may elect the time at which distributions under the Plan are to commence by designating the month and year during which the first distribution is to be made. The earliest distribution commencement date that may be elected by the PARTICIPANT shall be the earlier of: (a) The date on which the PARTICIPANT separates from service; or (b) The date on which the PARTICIPANT attains age 70 or terminates deferrals under this Plan, whichever is later. In addition, the date chosen must be at least five (5) days following the date on which the election is filed with the Administrator. The PARTICIPANT shall make such election no later than sixty (60) days following the end of the calendar year in which the PARTICIPANT separates from service or sixty (60) days following attainment of age 70, whichever occurs first. Benefits payable to the PARTICIPANT will be the equivalent of the total benefits that would have been created had the deferred amounts been invested as specified by the PARTICIPANT. The date elected for commencement of distributions "the Elected Commencement Date shall be not later than the Mandatory Commencement Date, which is the later of: (a) April 1 of the calendar year following the calendar year in which the PARTICIPANT attains Y. age 70 or 3 (b) April 1 of the calendar year following the calendar year in which the PARTICIPANT separates from service with the EMPLOYER. Page 4 DC -549 -B (8 -89) Such election shall no4 changed once the election is made. '.re to file an election with the Administrator within the appropriate time period will result in the Administrator beginning distributions on the Mandatory Commencement Date. 8.02. Mode of Payment: Benefits shall be paid in accordance with the payment option elected by the PARTICIPANT. Payment, method of payment, and settlement options are available as provided by each of the available investment specifications. At least thirty (30) days prior to the Elected or Mandatory Commencement Date, the PARTICIPANT shall elect the mode of payment based upon the options then available. Such election shall be irrevocable after the thirtieth (30th) day preceding the date on which benefits will commence. Failure to file an election with the Administrator will result in: (a) If the PARTICIPANT'S account value is $10,000.00 or less, the Administrator shall make a lump sum distribution to the PARTICIPANT; or (b) If the PARTICIPANT'S account value is greater than $10,000.00, the Administrator shall elect an annuity payout for the PARTICIPANT which provides for monthly payments to the PARTICIPANT in the form of a life annuity with a ten (10) year certain period. 8.03. Payments to Beneficiary: If the PARTICIPANT dies while employed with the EMPLOYER, or the PARTICIPANT dies before the benefits to which he is entitled under this Plan have been exhausted, the benefit payable under this Plan shall be paid to his designated Beneficiary. The Beneficiary shall have the right to elect the time and mode of payment of such benefits, subject to the limitations set forth in this Plan. Such election as to the time of payment (distribution commencement date) shall be filed by the Beneficiary not later than one hundred twenty (120) days following the PARTICIPANT'S death and shall not be changed once the election is made. The distribution commencement date must be at least five (5) days following the date on which the election as to the time of payment is filed with the Administrator (subject to the December 31 commencement date for surviving spouses as described later in this Section), and distributions to a Beneficiary shall be completed within the applicable time period specified in the remaining paragraphs of this Section. An election concerning the mode of payment shall be filed by the Beneficiary either (i) at least thirty (30) days prior to the date elected for the commencement of benefits, or (ii) within one hundred twenty (120) days following the PARTICIPANT'S death, whichever is later. Failure to file an election as to the time of payment will result in. the Administrator beginning distribution to the Beneficiary no earlier than one hundred twenty-five (125) days following the PARTICIPANT'S death (subject to the December 31 commencement date for surviving spouses as described later in this Section). Failure to file an election as to the manner of payment will result in the Administrator making a lump sum cash distribution. If the PARTICIPANT dies prior to January 1, 1989, benefits payable to a Beneficiary shall, in all events, be completed during a period not in excess of (a) the life of the Beneficiary, if such Beneficiary is the surviving spouse of the PARTICIPANT, or (b) 15 years, in all other circumstances. If the PARTICIPANT dies on or after January 1, 1989, and after the commencement of distributions, then any amount not distributed to the PARTICIPANT during his life shall be distributed to the Beneficiary at least as rapidly as under the method of distribution used by the PARTICIPANT at the time of the PARTICIPANT'S death. In addition, if the PARTICIPANT dies prior to the commencement of distributions, but on or after January 1, 1989, then the PARTICIPANT'S account shall be distributed to the Beneficiary within 5 years (or over the life or life expectancy of the Beneficiary, but not to exceed 15 years, if distributions commence within 1 year); provided, however, that if such Beneficiary is the surviving spouse of the PARTICIPANT, then (a) such distributions need not commence prior to December 31 of the calendar year in which the PARTICIPANT would have attained age 70 (or such other date as may be permitted under applicable Treasury Regulations), and (b) benefits payable to such spouse shall be completed during a period not in excess of such spouse's life expectancy. No settlement option available to the PARTICIPANT shall provide benefits to Beneficiaries which are equal to or greater than 33 1/3% of the maximum benefit (or such other amount as may be permitted under applicable Treasury Regulations) that would have been payable to the PARTICIPANT if no provision had been made for payment to a Beneficiary (as determined by the use of the expected return multiples in Treasury Regulation Section 1.72.9, or, in the case of payments under a contract issued by an insurance company, by the use of the mortality tables of such company). In addition, any settlement option payable over a period of more than 1 year shall be made only in substantially nonincreasing amounts paid not less frequently than annually. DC -549 -B (8 -89) Page 5 8.04. Unforeseeable 4-rgency: Notwithstanding any other ions herein, in the event of an Unforeseeable Emergency, a PARTICIPANT may request that benefits be paid to him immediately; provided, however, that payment of any such benefits after the Elected or Mandatory Commencement Date shall be subject to any limitations specified by an investment carrier. Such request shall be filed in accordance with procedures established pursuant to this Plan. If the application for payment is approved by the EMPLOYER or its designee, payments shall be effected within 45 days of such approval. Benefits to be paid shall be limited strictly to the amount necessary to meet the Unforeseeable Emergency constituting financial hardship to the extent such Unforeseeable Emergency Ls not relieved: (a) through reimbursement or compensation by insurance or otherwise; (b) by liquidation of the PARTICIPANT'S assets, to the extent the liquidation of such assets would not itself cause financial hardship; or (c) by cessation of deferrals under the Plan. Foreseeable personal expenditures normally budgetable, such as a down payment on a home, the purchase of an automobile, college or other educational expenses, etc., will not constitute an Unforeseeable Emergency. The decision of the EMPLOYER or its designee concerning the payment of benefits under this Section shall be final. ARTICLE IX Administration of Plan 9.01. The Employer may at any time amend, modify, or terminate the Plan without the consent of the PARTICIPANT (or any Beneficiary thereof). All amendments shall become effective forty -five (45) days after the issuance of notice of the amendments by the Administrator to the EMPLOYER. To the extent it is possible to do so, the Administrator shall mail an explanation of all amendments that become effective during the year to the PARTICIPANT with his annual report. 'No amendments shall deprive the PARTICIPANT of any of the benefits to which he is entitled under this Plan with respect to deferred amounts credited to his account prior to the effective date of the amendment. If the Plan is curtailed, terminated, or the acceptance of additional deferred amounts suspended permanently, the Administrator shall nonetheless be responsible for the supervision of the payment of benefits resulting from amounts deferred prior to the amendment, modification, or termination in accordance with Article VIII hereof. 9.02. Any companies that may issue any policies, contracts, or other forms of investment media used by the EMPLOYER or specified by the PARTICIPANT, are not parties to this Plan and such companies shall have no responsibility or accountablility to the PARTICIPANT or his Beneficiary with regard to the operation of this Plan. 9.03. Participation in this Plan by a Public Employee shall not be construed to give a contract of employment to the PARTICIPANT or to alter or amend an existing employment contract of the PARTICIPANT, nor shall participation in this Plan be construed as affording to the PARTICIPANT any representation or guarantee regarding his continued employment. 9.04. The EMPLOYER and the Administrator do not represent or guarantee that any particular Federal or State income, payroll, personal property, or other tax consequence will occur because of the PARTICIPANT'S participation in this Plan. The PARTICIPANT should consult with his own representative regarding all questions of Federal or State income, payroll, personal property, or other tax consequences arising from participation in this Plan. 9.05. The Administrator shall have the power to appoint agents to act for and in the administration of this Plan and to select depositories for the assets of this Plan. 9.06. Whenever used herein, the masculine gender shall include the feminine and the singular shall include the plural unless the provisions of the Plan specifically require a different construction. Page 6 oc -549 -B (8 -89) 9.07. The laws of the state of the EMPLOYER shall apply in ermining the construction and validity of this Plan. 9.08. The rights of the PARTICIPANT under this Plan shall not be subject to the rights of creditors of the PARTICIPANT or any Beneficiary, and shall be exempt from execution, attachment, prior assignment, or any other judicial relief or order for the benefit of creditors or other third persons. 9.09. It is agreed that neither the PARTICIPANT nor his Beneficiary nor any other designee shall have any right to commute, sell, assign, pledge, encumber, transfer, or otherwise convey the right to receive any payments hereunder which payments and right thereto are expressly declared to be nonassignable and nontransferable. 9.10. This Plan, and any properly adopted amendments, shall constitute the total agreement or contract between the EMPLOYER and the PARTICIPANT regarding the Plan. No oral statement regarding the Plan may be relied upon by the PARTICIPANT. 9.11. This Plan and any properly adopted amendments, shall be binding on the parties hereto and their respective heirs, administrators, trustees, successors, and assignees and on all Beneficiaries of the PARTICIPANT. ARTICLE X Notice to ALL PARTICIPANTS to Read These Provisions Providing Broad Powers and Absolute Safeguards to the EMPLOYER 10.01. The EMPLOYER, or its authorized agent, the Administrator, shall be authorized to resolve any questions of fact necessary to decide the PARTICIPANT'S right under this Plan and such decision shall be binding on the PARTICIPANT and any Beneficiary thereof. 10.02. The EMPLOYER, or its authorized agent, the Administrator, shall be authorized to construe the Plan and to resolve any ambiguity in the Plan. 10.03. The PARTICIPANT specifically agrees not to seek recovery against the EMPLOYER, the Administrator or any other employee, contractee, or agent of the EMPLOYER or Administrator, or any endorser for any Toss sustained by the PARTICIPANT or his Beneficiary, for the non performance of their duties, negligence, or any other misconduct of the above named persons except that this paragraph shall not excuse fraud or wrongful taking by any person. 10.04. The EMPLOYER, or its agents including the Administrator, if in doubt concerning the correctness of their action in making a payment of a benefit, may suspend the payment until satisfied as to the correctness of the payment or the person to receive the payment or allow the filing in any State court of competent jurisdiction, a suit in such form as they consider appropriate for a legal determination of the benefits to be paid and the persons to receive them. The EMPLOYER shall comply with the final orders of the court in any such suit and the PARTICIPANT, for himself and his Beneficiary, consents to be bound thereby insofar as it affects the benefits payable under this Plan or the method or manner of payment. 10.05. The EMPLOYER andfits agents, including the Administrator, are hereby held harmless from all court costs and all claims for the attorneys' fees arising from any action brought by the PARTICIPANT or any Beneficiary thereof under this Plan or to enforce his rights under this Plan, including any amendments hereof. 10.06. The Administrator shall not be required to participate in any litigation concerning the Plan except upon written demand from the EMPLOYER. The Administrator may compromise, adjust or effect settlement of litigation when specifically instructed to do so by the EMPLOYER. DC -SAG -B (8--89) Page 7 ARTICLE XI Prior Plan If the EMPLOYER has already accepted the United States Conference of Mayors Deferred Compensation Program and adopted an eligible deferred compensation plan, as defined in IRC Section 457, under such Program (the "Prior Plan then the EMPLOYER intends that this Plan shall amend and restate the Prior Plan. In such event, this Plan shall apply to all participants in the Prior Plan on the effective date hereof, and also to each Public Employee who elects to participate in this Plan on and after the effective date hereof. ARTICLE X11 Effective Date This Plan shall be effective on the date and year written below. I WITNESS WHEREOF, the undersigned has executed this Plan this /9 of (Name of City) By: ��r /1��%�' C )9, jeo I Fr i• A rE-.65c 0 4- Ju2(__(> .-(1 er)lo 0'11 4-c --P Page 8 DC -E49 -B (8 -R9) ARTICLE XI Prior Plan If the EMPLOYER has already accepted the United States Conference of Mayors Deferred Compensation Program and adopted an eligible deferred compensation plan, as defined in IRC Section 457, under such Program (the "Prior Plan then the EMPLOYER intends that this Plan shall amend and restate the Prior Plan. In such event, this Plan shall apply to all participants in the Prior Plan on the effective date hereof, and also to each Public Employee who elects to participate in this Plan on and after the effective date hereof. ARTICLE XII Effective Date This Plan shall be effective on the date and year written below. IN WITNESS WHEREOF, the undersigned has executed this Plan this of 7 1(-0--c 6=-4J 19 l'i l',•f o f N ene/ /y2.d (Name df City) 0 B tUel- 0- 1-4 -)LIS ZLI--d--a C/4--- Q 0 LL Q w a L11 CC w w PLEASE SIGN AND RETURN THIS PAGE ONLY. DC -549 -B (8 -89) E xH Jr 6 'Pc6stO f Pi) •ITED STATES CONFERENCE kMAYORS CARb1EL CLERK DEFERRED COMPENSATION PROGRAM TREAS THE DEFERRED COMPENSATION PLAN FOR PUBLIC EM' s PLAN DOCUMENT JAN 1 1eE_ C k. NAME OF CI The Plan consists of the provisions set forth in this document, and is applicable to each Public Employee who elects to participate in the Plan. The Plan is effective as to each such Public Employee upon the date he becomes a "PARTICIPANT" by signing and filing with the Administrator the Par- ticipation Agreement referred to herein. ARTICLE 1 Definitions 1.01. The following terms shall, for purposes of this Plan, have the meaning set forth below. (a) ADMINISTRATOR means the person, department, agency or organization appointed by the EMPLOYER to administer the Plan. (b) BENEFICIARY means the person properly designated by a PARTICIPANT to receive the PARTICIPANT'S benefit under this Plan. (c) COMPENSATION means all payments made by the EMPLOYER as remuneration for ser- vices rendered, including salaries, fees, etc. (d) EMPLOYER means the above referenced city or any of its agencies, departments, sub- divisions or instrumentalities for which services are performed by a PARTICIPANT. (e) INCLUDIBLE COMPENSATION means, for the purposes of the limitations on deferrals, compensation for services performed for the EMPLOYER which is currently includible in gross Income after giving effect to all provisions of the IRC. The amount of Includible Compensation shall be determined without regard to any community property laws. (f) INDEPENDENT CONTRACTOR means any person receiving any type of compensation from the EMPLOYER or any of its agencies, departments, subdivisions or instrumentalities for which services are rendered pursuant to one or more written or oral contracts, if s person is not an employee. (g) IRC means the Internal Revenue Code of 1986, as now in effect or as hereafter amt.. (h) NORMAL RETIREMENT AGE means the age specified in writing by the PARTICIPAN 1. If the EMPLOYER has an EMPLOYER'S Retirement System, the Normal Retirement Age specified by the PARTICIPANT must be an age at which the PARTICIPANT is eligible to retire pursuant to the EMPLOYER'S Retirement System, by virtue of age, length of ser- vice, or both, without consent of the EMPLOYER and with the right to receive immediate retirement benefits without actuarial or similar reduction because of retirement before some later specified age. In no event shall Normal Retirement Age be later than age 70 1/2. (I) PARTICIPANT means any Public Employee who is eligible to defer Compensation under the Plan and who participates under this Plan by signing the Participation Agreement. (J) PARTICIPATION AGREEMENT means the application to the Administrator to participate In the Plan. DC -549 -B (8 -89) Page 1 (k) PLAN me he Deferred Compensation Plan For Old Employees as set forth in this document and as it may be amended from time to time. (I) PLAN YEAR means the calendar year in which the Plan becomes effective, and each succeeding calendar year during the existence of this Plan. (m) PUBLIC EMPLOYEE means any person who receives any type of compensation from the EMPLOYER for which services are rendered (including, but not limited to elected or appointed officials, salaried employees, and independent contractors). (n) SEPARATION FROM SERVICE means Separation From Service as defined in IRC Section 402(e)(4)(A)(iii), and on account of the PARTICIPANT'S death or retirement. An Independent Contractor shall not be considered Separated From Service with the EMPLOYER and shall not receive any benefits hereunder unless (1) at least 12 months have expired since the date on which the last contract, pursuant to which the Independent Contractor provided any services to the EMPLOYER, was terminated, and (2) the Independent Contractor has performed no services for the EMPLOYER during the 12-month period referred to herein either as an Independent Contractor or employee. (o) UNFORESEEABLE EMERGENCY means severe financial hardship to the PARTICIPANT resulting from a sudden and unexpected illness or accident of the PARTICIPANT or a dependent (as defined in IRC Section 152(a)) of the PARTICIPANT, loss of the PARTICIPANT'S property due to casualty, or other similar or extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the PARTICIPANT. ARTICLE 11 Election to Defer Compensation 2.01. The PARTICIPANT may elect to participate by signing the Participation Agreement and consenting to a reduction of salary by the deferral amount specified in the Participation Agreement. The amount of the reduction "deferred amount must equal at least $20 per month. 2.02. The EMPLOYER shall commence the reduction no earlier than the first pay period com- mencing during the first month after the date on which the Participation Agreement is filed with the Administrator. 2.03. (a) The PARTICIPANT may revoke his election to participate and may amend the amount of Compensation to be deferred by signing and filing with the Administrator a written revocation or amendment on a form and in the procedural manner approved by the Administrator. In addition, the PARTICIPANT may amend his investment specification in the procedural manner approved by the Administrator. Any amendment which increases the amount deferred for any pay period shall be effective only if an agreement providing for such additional deferred amount is entered into before the beginning of the month in which the pay period commences. Any revocation or amendment of the amount deferred shall be effective prospectively only. Any change in the PARTICIPANT'S investment specification by the PARTICIPANT, whether it applies to amounts previously deferred or amounts to be deferred in the future, shall be effective prospectively only and shall be effective on a date consistent with the rules and specifications of the investment carrier. (b) After the death of the PARTICIPANT, his Beneficiary shall have the right to amend the PARTICIPANT'S, or the Beneficiary's own, investment specification by signing and filing with the Administrator a written amendment on a form and in the procedural manner approved by the Administrator. Any change in an investment specification by a Beneficiary shall be effective on a date consistent with the rules and specifications of the investment carrier. The right of a Benefi- ciary to amend an investment specification shall terminate on the last day available for an election concerning the mode of payment pursuant to Section 8.03 below. Notice to ALL PARTICIPANTS to Read These Provisions Providing Deferral Limitations and "Catch- up" Deferrals Under the Plan. 2.04. Except as provided in Section 2.05, the maximum deferred amount under the Plan for the PARTICIPANT'S taxable year shall not exceed the lesser of (a) $7,500 or (b) 33 1/3 of the PAR- TICIPANT'S Includible Compensation as provided in IRC Section 457. Page 2 DC -549 -B (8 -89) 2.05. For one or more e PARTICiPANT'S'Iast 3 taxable ye. rl iding before the attainment of Normal Retirement Ag under the Plan, the maximum deferral II be the lesser of: (a)$15,000 or (b) the limitation established for the taxable year under Section 2.04, plus the limitation established for purposes of Section 2.04 for prior taxable years beginning after December 31, 1978, during which the PARTICIPANT was eligible to participate less the amount of Compensation deferred under the Plan for such prior taxable years. 206. In applying the deferral limitations of Sections 2.04 and 2.05, any amounts excluded from the PARTICIPANT'S gross income for the taxable year under IRC Section 403(b), and, effective January 1, 1989, under IRC Sections 402(a)(8) and 402(h)(1)(B) and deductible contributions to an organization described In iRC Section 501(c)(18), shall be treated as amounts deferred as provided in IRC Section 457(c). ARTICLE 01 EMPLOYER Contributions The EMPLOYER may contribute to the Plan for PARTICIPANTS. EMPLOYER contributions shall vest at the time such contributions are made. For purposes of administering Sections 2.04 and 2.05, EMPLOYER contributions shall apply toward the maximum deferral limits in the Plan Year that such contributions are made. ARTICLE IV Plan Transfers 4.01. If a PARTICIPANT terminates employment with the EMPLOYER and accepts employment with another employer which maintains an eligible deferred compensation plan (as defined in IRC Section 457) and the new employer's plan accepts transfers, the PARTICIPANT may transfer his account balance from the Plan to the plan maintained by the new employer. 4.02. Transfers from other eligible deferred compensation plans (as defined in IRC Section 457) to the Plan will be accepted at the PARTICIPANT'S request if such transfers are in cash or non- annuity products currently offered under the Plan. Any such transferred amount shall not be subject to the limitations of Section 2.04, provided, however, that the actual amount deferred during the calendar year under both plans shall be taken into account in calculating the deferral limitation for that year. For purposes of determining the limitation set forth in Section 2.05, years of eligibility to participate in the prior plan and deferrals under that plan shall be considered. ARTICLE V Designation of Beneficiary The PARTICIPANT shall have the right to file, with the Administrator, a written Beneficiary or change of Beneficiary form designating the person or persons who shall receive the benefits payable under this Plan in the event of the PARTICIPANT'S death. The form for this purpose shall be provided by the Administrator and will have no effect until it is signed, filed with the Administrator by the PARTICIPANT, and accepted by the Administrator. If the PARTICIPANT dies without having a Beneficiary form on file, the benefits will be paid to the PARTICIPANT'S estate. The PARTICIPANT accepts and acknowledges that he has the burden for executing and filing with the Administrator a proper Beneficiary designation form. ARTICLE VI Accounts and Reports 6.01. THE EMPLOYER shall remit the amounts deferred to the Administrator or his designated agent. The Administrator shall have no duty to determine whether the funds paid to him by the EMPLOYER are correct, nor to collect or enforce such payment. 6.02. For convenience and to facilitate an orderly administration of the Plan, the Administrator shall maintain a deferred account with respect to each PARTICIPANT. A written report of the status of the PARTICIPANT'S deferred account shall be furnished at least annually and within ninety (90) days after the end of each calendar year to the PARTICIPANT. DC -549 -8 (8 -89) Page 3 f 6.03. Within ninety (9 s after the end of the calendar year x Administrator shall file with the EMPLOYER a written report of the assets of the Plan, a schedu e of ail receipts and disburse- ments, and a report of all material transactions of the Plan during the preceding year. 6.04. The Administrator's records shall be open to inspection during normal business hours by the EMPLOYER or any PARTICIPANT, or their designated representatives. 6.05. All reports to the PARTICIPANT shall be based on fair market value as of the reporting date. ARTICLE VII Investment of Deferred Amount 7.01. The deferred amounts shall be delivered by the EMPLOYER to the Administrator or his designated agent for investment as designated by the EMPLOYER. 7.02. The EMPLOYER shall use the PARTICIPANT'S or Beneficiary's investment specifications so as to determine the value of the deferred account maintained with respect to the PARTICIPANT as If the deferred amounts had been invested according to such specifications. The EMPLOYER shall be under no obligation to invest the deferred amounts as specified by the PARTICIPANT or Beneficiary. 7.03. All interest, dividends, charges for premiums and administrative expenses, and changes in value due to market fluctuations applicable to each PARTICIPANT'S deferred account shall be credited or debited to the account as they occur. 7.04. All assets of the Plan, including all deferred amounts, property and rights purchased with deferred amounts, and all income attributable to such deferred amounts, property or rights, shall remain (until made available to the PARTICIPANT or Beneficiary) solely the property and rights of the EMPLOYER (without being restricted to the provision of benefits under the Plan), subject only to the claims of creditors of the EMPLOYER. Contracts and other evidences of the investments of all assets under this Plan shall be registered in the name of the EMPLOYER which shall be the owner and beneficiary thereof. The rights of the PARTICIPANT created by this Plan shall be those of a general creditor of the EMPLOYER, and in an amount equal to the fair market value of the deferred account maintained with respect to the PARTICIPANT. The PARTICIPANT acknowledges that his rights are no greater than those of a general creditor of the EMPLOYER and that in any suit for an accounting, to impose a constructive trust, or to recover any sum under this Plan, the PARTICIPANT'S rights are limited to those of a general creditor of the EMPLOYER. The EMPLOYER acknowledges that the Administrator is the agent of the EMPLOYER. ARTICLE VIII Benefits 8.01. Commencement of Distributions: The PARTICIPANT may elect the time at which distributions under the Plan are to commence by designating the month and year during which the first distribution is to be made. The earliest distribution commencement date that may be elected by the PARTICIPANT shall be the earlier of: (a) The date on which the PARTICIPANT separates from service; or (b) The date on which the PARTICIPANT attains age 70 or terminates deferrals under this Plan, whichever is later. In addition, the date chosen must be at Least five (5) days following the date on which the election is filed with the Administrator. The PARTICIPANT shall make such election no Later than sixty (60) days following the end of the calendar year in which the PARTICIPANT separates from service or sixty (60) days following attainment of age 70, whichever occurs first. Benefits payable to the PARTICIPANT will be the equivalent of the total benefits that would have been created had the deferred amounts been invested as specified by the PARTICIPANT. The date elected for commencement of distributions "the Elected Commencement Date shall be not later than the Mandatory Commencement Date, which is the later of: (a) April 1 of the calendar year following the calendar year in which the PARTICIPANT attains age 701: or (b) April 1 of the calendar year following the calendar year in which the PARTICIPANT separates from service with the EMPLOYER. Page 4 DC -549 -B (8 -89) Such election shall not be aged once the election is made. Failu j file an election with the Administrator within the appropriate time period will result in the Administrator beginning distributions on the Mandatory Commencement Date. 8.02. Mode of Payment: Benefits shall be paid in accordance with the payment option elected by the PARTICIPANT. Payment, method of payment, and settlement options are available as provided by each of the available investment specifications. At least thirty (30) days prior to the Elected or Mandatory Commencement Date, the PARTICIPANT shall elect the mode of payment based upon the options then available. Such election shall be irrevocable after the thirtieth (30th) day preceding the date on which benefits will commence. Failure to file an election with the Administrator will result in: (a) If the PARTICIPANT'S account value is $10,000.00 or less, the Administrator shall make a lump sum distribution to the PARTICIPANT; or (b) If the PARTICIPANT'S account value is greater than $10,000.00, the Administrator shall elect an annuity payout for the PARTICIPANT which provides for monthly payments to the PARTICIPANT in the form of a life annuity with a ten (10) year certain period. 8.03. Payments to Beneficiary: if the PARTICIPANT dies while employed with the EMPLOYER, or the PARTICIPANT dies before the benefits to which he is entitled under this Plan have been exhausted, the benefit payable under this Plan shall be paid to his designated Beneficiary. The Beneficiary shall have the right to elect the time and mode of payment of such benefits, subject to the limitations set forth in this Plan. Such election as to the time of payment (distribution commencement date) shall be filed by the Beneficiary not later than one hundred twenty (120) days following the PARTICIPANT'S death and shall not be changed once the election is made. The distribution commencement date must be at least five (5) days following the date on which the election as to the time of payment is filed with the Administrator (subject to the December 31 commencement date for surviving spouses as described later in this Section), and distributions to a Beneficiary shall be completed within the applicable time period specified in the remaining paragraphs of this Section. An election concerning the mode of payment shall be filed by the Beneficiary either (i) at least thirty (30) days prior to the date elected for the commencement of benefits, or (ii) within one hundred twenty (120) days following the PARTICIPANT'S death, whichever is later. Failure to file an election as to the time of payment will result in the Administrator beginning distribution to the Beneficiary no earlier than one hundred twenty-five (125) days following the PARTICIPANT'S death (subject to the December 31 commencement date for surviving spouses as described later in this Section). Failure to file an election as to the manner of payment will result in the Administrator making a lump sum cash distribution. If the PARTICIPANT dies prior to January 1, 1989, benefits payable to a Beneficiary shall, in all events, be completed during a period not in excess of (a) the life of the Beneficiary, if such Beneficiary is the surviving spouse of the PARTICIPANT, or (b) 15 years, in all other circumstances. If the PARTICIPANT dies on or after January 1, 1989, and after the commencement of distributions, then any amount not distributed to the PARTICIPANT during his life shall be distributed to the Beneficiary at least as rapidly as under the method of distribution used by the PARTICIPANT at the time of the PARTICIPANT'S death. in addition, if the PARTICIPANT dies prior to the commencement of distributions, but on or after January 1, 1989, then the PARTICIPANT'S account shall be distributed to the Beneficiary within 5 years (or over the life or life expectancy of the Beneficiary, but not to exceed 15 years, if distributions commence within 1 year); provided, however, that if such Beneficiary is the surviving spouse of the PARTICIPANT, then (a) such distributions need not commence prior to December 31 of the calendar year in which the PARTICIPANT would have attained age 701/2 (or such other date as may be permitted under applicable Treasury Regulations), and (b) benefits payable to such spouse shall be completed during a period not in excess of such spouse's life expectancy. No settlement option available to the PARTICIPANT shall provide benefits to Beneficiaries which are equal to or greater than 33 1/3% of the maximum benefit (or such other amount as may be permitted under applicable Treasury Regulations) that would have been payable to the PARTICIPANT if no provision had been made for payment to a Beneficiary (as determined by the use of the expected return multiples in Treasury Regulation Section 1.72 -9, or, in the case of payments under a contract issued by an insurance company, by the use of the mortality tables of such company). In addition, any settlement option payable over a period of more than 1 year shall be made only in substantially nonincreasing amounts paid not less frequently than annually. 00-549 -6 (8 -89) Page 5 8.04. Unforeseeable Em ncy: Notwithstanding any other provi0 herein, in the event of an Unforeseeable Emergency, a PARTICIPANT may request that benefits be paid to him immediately; provided, however, that payment of any such benefits after the Elected or Mandatory Commencement Date shall be subject to any limitations specified by an investment carrier. Such request shall be filed in accordance with procedures established pursuant to this Plan. If the application for payment is approved by the EMPLOYER or its designee, payments shall be effected within 45 days of such approval. Benefits to be paid shall be limited strictly to the amount necessary to meet the Unforeseeable Emergency constituting financial hardship to the extent such Unforeseeable Emergency is not relieved: (a) through reimbursement or compensation by insurance or otherwise; (b) by liquidation of the PARTICIPANT'S assets, to the extent the liquidation of such assets would not itself cause financial hardship; or (c) by cessation of deferrals under the Plan. Foreseeable personal expenditures normally budgetabie, such as a down payment on a home, the purchase of an automobile, college or other educational expenses, etc., will not constitute an Unforeseeable Emergency. The decision of the EMPLOYER or its designee concerning the payment of benefits under this Section shall be final. ARTICLE IX Administration of Plan 9.01. The Employer may at any time amend, modify, or terminate the Plan without the consent of the PARTICIPANT (or any Beneficiary thereof). All amendments shall become effective forty -five (45) days after the issuance of notice of the amendments by the Administrator to the EMPLOYER. To the extent It is possible to do so, the Administrator shall mail an explanation of all amendments that become effective during the year to the PARTICIPANT with his annual report. No amendments shall deprive the PARTICIPANT of any of the benefits to which he is entitled under this Plan with respect to deferred amounts credited to his account prior to the effective date of the amendment. If the Plan is curtailed, terminated, or the acceptance of additional deferred amounts suspended permanently, the Administrator shall nonetheless be responsible for the supervision of the payment of benefits resulting from amounts deferred prior to the amendment, modification, or termination in accordance with Article VIIi hereof. 9.02. Any companies that may issue any policies, contracts, or other forms of investment media used by the EMPLOYER or specified by the PARTICIPANT, are not parties to this Plan and such companies shall have no responsibility or accountablility to the PARTICIPANT or his Beneficiary with regard to the operation of this Plan. 9.03. Participation in this Plan by a Public Employee shall not be construed to give a contract of employment to the PARTICIPANT or to alter or amend an existing employment contract of the PARTICIPANT, nor shall participation in this Plan be construed as affording to the PARTICIPANT any representation or guarantee regarding his continued employment. 9.04. The EMPLOYER and the Administrator do not represent or guarantee that any particular Federal or State income, payroll, personal property, or other tax consequence will occur because of the PARTICIPANT'S participation In this Plan. The PARTICIPANT should consult with his own representative regarding all questions of Federal or State income, payroll, personal property, or other tax consequences arising from participation in this Plan. 9.05. The Administrator shall have the power to appoint agents to act for and in the administration of this Plan and to select depositories for the assets of this Plan. 9,06. Whenever used herein, the masculine gender shall include the feminine and the singular shall include the plural unless the provisions of the Plan specifically require a different construction. Page 6 DC -549 -B (8 -89) 9.07. The laws of thte of the EMPLOYER shall apply in mining the construction and validity of this Plan. 9.08. The rights of the PARTICIPANT under thls Plan shall not be subject to the rights of creditors of the PARTICIPANT or any Beneficiary, and shall be exempt from execution, attachment, prior assignment, or any other judicial relief or order for the benefit of creditors or other third persons. 9.09. It is agreed that neither the PARTICIPANT nor his Beneficiary nor any other designee shall have any right to commute, sell, assign, pledge, encumber, transfer, or otherwise convey the right to receive any payments hereunder which payments and right thereto are expressly declared to be nonassignable and nontransferable. 9.10. This Plarj, and any properly adopted amendments, shall constitute the total agreement or contract between the EMPLOYER and the PARTICIPANT regarding the Plan. No oral statement regarding the Plan may be relied upon by the PARTICIPANT. 9.11. This Plan and any properly adopted amendments, shall be binding on the parties hereto and their respective heirs, administrators, trustees, successors, and assignees and on all Beneficiaries of the PARTICIPANT. ARTICLE X Notice to ALL PARTICIPANTS to Read These Provisions Providing Broad Powers and Absolute Safeguards to the EMPLOYER 10.01. The EMPLOYER, or its authorized agent, the Administrator, shall be authorized to resolve any questions of fact necessary to decide the PARTICIPANT'S right under this Plan and such decision shall be binding on the PARTICIPANT and any Beneficiary thereof. 10.02. The EMPLOYER, or its authorized agent, the Administrator, shall be authorized to construe the Plan and to resolve any ambiguity In the Plan. 10.03. The PARTICIPANT specifically agrees not to seek recovery against the EMPLOYER, the Administrator or any other employee, contractee, or agent of the EMPLOYER or Administrator, or any endorser for any loss sustained by the PARTICIPANT or his Beneficiary, for the non- performance of their duties, negligence, or any other misconduct of the above named persons except that this paragraph shall not excuse fraud or wrongful taking by any person. 10.04. The EMPLOYER, or its agents including the Administrator, if in doubt concerning the correctness of their action in making a payment of a benefit, may suspend the payment until satisfied as to the correctness of the payment or the person to receive the payment or allow the filing in any State court of competent jurisdiction, a suit in such form as they consider appropriate for a legal determination of the benefits to be paid and the persons to receive them. The EMPLOYER shall comply with the final orders of the court in any such suit and the PARTICIPANT, for himself and his Beneficiary, consents to be bound thereby insofar as it affects the benefits payable under this Plan or the method or manner of payment. 10.05. The EMPLOYER and its agents, including the Administrator, are hereby held harmless from all court costs and all claims for the attorneys' fees arising from any action brought by the PARTICIPANT or any Beneficiary thereof under this Plan or to enforce his rights under this Plan, including any amendments hereof. 10.06. The Administrator shalt not be required to participate In any litigation concerning the Plan except upon written demand from the EMPLOYER. The Administrator may compromise, adjust or effect settlement of litigation when specifically instructed to do so by the EMPLOYER. DC -549 -B (8 -89) Page 7 EXHI `31-7- litatiftat t? ^4 �3:r DEFERRED COMPENSATION PLAN OF THE City OF Carmel [NAME OF EMPLOYER) JAN 1 0 1991 I. INTRODUCTION In accordance with the provisions of Cit Council Ordinance D #295 c. a..:F a:::. t .r v.We,<�.. ...,r..e •tom:: and as provided in Section 457 of the Internal Revenue Code of 1986, the City of Camel hereby establishes the Deferred Compensation Plan of the City of Carmel hereinafter referred to as the "Plan." Nothing contained in this Plan shall be deemed to constitute an employment agreement between any Participant and the City of Carmel__ and nothing contained herein shall be deemed to give a Participant any right to be retained in the employ of the City of Carmel II. DEFINITIONS 2.01 "Administrator" shall mean the person, persons or entity appointed by the Employer to administer the Plan pursuant to section 3.02 or appointed pursuant to section 3.05, if any. 2.02 "Beneficiary" shall mean the persons or entities designated by a Participant pursuant to section 5.05. 2.03 "Code" shall mean the Internal Revenue Code of 1986, as amended, or any future United States internal revenue law. References herein to specific section numbers shall be deemed to refer to corresponding provisions of any future United States internal revenue law. 2.04 "Compensation" shall mean all payments made to an Employee by the Employer as remuneration for services rendered, including salaries and fees. 2.05 "Deferred Compensation" shall mean the amount of Compensation not yet earned which the Participant and the Employer mutually agree will be deferred. 2.06 "Employee" shall mean any employee or independent contractor (including an elected or appointed official) who performs services for and receives any type of compensation from the Employer (or any agency, department, subdivision or instrumentality of the Employer) for whom services are rendered. 2.07 "Employer" shall mean City of Carmel 2.08 "Includible Compensation" shall mean, for purposes of the limitation set forth in section 4.02, Compensation for services performed for the Employer that is currently includible in the Participant's gross income for Federal income tax purposes, determined without regard to any community property laws.• Includible Compensation thus does not include Compensation excludable from the Participant's gross income under Section 457 of the Code as a result of deferrals under this Plan or under other provisions (for example, Sections 105(d), and 911) of the Code. 2.09 "Normal Retirement Age" shall mean OPTION I age 65. lik IV::T., OPTION II -ate- (NOTE: A SPECIFIC AGE MUST BE BETWEEN THE A D (a ii) OF OPTIESCRIBED ON III IN PARAGRAPHS (a)(i) AND earliest of 70 1/2 or separation from service OPTION III with respect to each Participant, the latest of: (a) The age designed by the Participant between (i) the earliest age at which the Participant has the right to retire under the Employer's basic retirement plan without the Employer's consent and to receive immediate retirement benefits without actuarial or similar reduction because of early retirement, and (ii) age 70 -1/2, or (b) The age at which the Participant terminates his service with the Employer; Provided, however, that a Participant's election to defer amounts in excess of the maximum deferral allowed by section 4.02 but within the limited catch -up permitted by section 4.03 shall constitute a designation of an age pursuant to subsection (a); and provided further, that if a Participant does not designate an age pursuant to subsection (a), he shall be deemed to have designated the age specified in subsection (a)(i). [NOTE: PROVISO APPLIES ONLY TO OPTION III.] 2.10 "Participant" shall mean any Employee who executes a Participation Agreement with the Administrator assenting to the provisions of this Plan, once the Agreement has been approved by the Administrator. Except for purposes of Articles IV, VII, and XIV, "Participant" shall include former Participants. The Administrator,' if he or 'she is otherwise eligible, may participate in the Plan. 2.11 "Participation Agreement" shall mean the agreement executed and filed by an Employee with the Employer pursuant to section 4.01, in which the Employee elects to become a Participant in the Plan. 2.12 "Plan Year" shall mean OPTION I the calendar year. OPTION II the Employer's fiscal year, which is the 12 month period ending on December 31 9 [NOTE: FOR THE IMPORT OF THE "PLAN YEAR," SEE SECTION 5.02(a).] 2.13 "Total Amount Deferred" shall mean, with respect to each Participant, the sum of all Compensation deferred under the Plan, plus income or less loss thereon (including amounts determined with reference to life insurance policies) calculated in accordance with section 4.08 by the method designated in the Participant's Participation Agreement(s) under which such Compensation was deferred and in any subsequent election(s) to change methods, less the amount of any expenses or distributions authorized by this Plan. p 0 7 [2.14 OPTIONAL: "Unforeseeable Emergency" shall mean severe financial hardship to a Participant resulting from a sudden and unexpected illness or accident of the Participant or of a dependent (as defined in Section 152(a) of the Code) of the Participant, loss of the Participant's property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The need to send a Participant's child to college or the desire to purchase a home shall not constitute Unforeseeable Emergencies. The Administrator shall determine in his, her or its sole discretion whether a hardship to a Participant constitutes an Unforeseeable Emergency. See Article VI.] III. ADMINISTRATION 3.01 This Plan shall be administered by the Administrator, who shall represent the Employer in all matters concerning the administration of this Plan. 3.02 Appointment and Termination of Administrator: OPTION I The Clerk —Treas of the City of Carmel [SPECIFY OFFICE AND EMPLOYER] shall be the Administrator. The rights, powers, privileges, and duties of the Administrator shall pass to each successor Clerk —Treas of the City of Carmel [SPECIFY OFFICE AND EMPLOYER] OPTION II The Administrator shall be named by the Employer and may be a Participant. The Administrator shall remain in office at the will of the Employer and may be removed from office at any time by the Employer, with or without cause. Such removal shall be effective upon delivery of written notice to the Employer or at such later time as may be designated in such notice; provided that any such .notice of removal shall take effect no later than 60 days after the delivery thereof, unless such 60 day period shall be waived. The Administrator may resign at any time upon giving written notice to the Employer or at such later time as may be designated in the notice of resignation; provided that (i) any such notice of resignation shall take effect no later than 60 days after the delivery thereof, unless such 60 day period shall be waived and (ii) upon such resignation or removal of the Administrator, the Employer shall have the power and the duty to designate and appoint a successor Administrator, and the actual appointment of a successor Administrator is a condition that must be fulfilled before the resignation or removal of the Administrator shall become effective. Upon appointment, the successor Administrator shall have all the rights, powers, privileges, liabilities and duties of the predecessor Administrator. The Administrator so resigned or removed shall take any and all action necessary to vest the rights, powers, privileges, liabilities and duties of the Administrator in his, her or its successor. 3.03 Subject to any applicable laws, the Administrator shall have full power and authority to adopt rules and regulations for the administration of the Plan, and to interpret, alter, amend, or revoke any rules and regulations so adopted. 3.04 Every action taken by the Administrator shall be presumed to be a fair and reasonable exercise of the authority vested in or the duties imposed upon him, her, or it. The Administrator shall be deemed to have exercised reasonable care, diligence and prudence and to have acted impartially as to all persons interested, unless the contrary be proven by affirmative evidence. The Administrator shall not be liable for amounts of Compensation deferred by Participants or for other amounts payable under the Plan. 2.);, 3.05 Subject to any applicable laws and any approvals required by the Employer, the Administrator may delegate any or all of his, her or its powers and duties hereunder to another person, persons, or entity, and may pay reasonable compensation for such services as an administrative expense of the Plan, to the extent such compensation is not otherwise paid. IV. PARTICIPATION IN THE PLAN 4.01 Enrollment in the Plan: (a) An Employee may become a Participant by executing a Participation Agreement. Compensation will be deferred for any calendar month only if a Participation Agreement providing for such deferral is executed by the Participant and approved by the Administrator before the beginning of such month. [OPTIONAL: Notwithstanding the preceding sentence, with respect to a new Employee, Compensation will be deferred for the calendar month during which a Participant first becomes an Employee if a Participation Agreement providing for such deferral is executed by the Participant and approved by the Administrator before the first day on which the .Participant becomes an Employee.] (b) In signing the Participation Agreement, the Participant elects to participate in this Plan and consents to the deferral by the Employer of the amount specified in the Participation Agreement from -the Participant's gross compensation for each pay period. [OPTIONAL: The deferred amount must equal at least 26 00 per pay period. j 1• 4.02 Deferral Limitations: Except as provided in Section 4.03, the maximum that may be deferred under the Plan for any taxable year of a Participant shall not exceed the lesser of (a) $71500 or (b) 33 1 /3% of the Participant's Includible Compensation, each reduced by any amount excludable from the Participant's gross income for that taxable year under Section 403(b) of the Code on account of OPTION I Contributions (including contributions .pursuant to salary reduction agreements) made by the Employer or any other employer. OPTION II Contributions (including contributions pursuant to salary reduction agreements) made by the Employer. In the case of a person who participates in more than one deferred compensation plan governed by Section 457 of the Code, the limitations set forth in sections 4.02 and 4.03 shall apply to all such plans considered together. For purposes of this section, Compensation deferred shall be taken into account at its value in the later of the Plan Year in which deferred or the Plan Year in which such Compensation is no longer subject to a substantial risk of forfeiture (within the meaning of Section 457(e)(3) of the Code). Under Option II the Plan does not, but the rules for determining the participant's taxable income do, reduce the maximum deferral by the amount of excludible 403(b) contributions made by employers other than the employer maintaining the Plan. Accordingly, the Plan might accept amounts which would be included in the participant's income in the year deferred. In contrast, under Option I employees who are covered by both the Plan and a 403(b) annuity maintained by a different employer might be allowed smaller deferrals under the Plan but the full amount of those deferrals would be currently excluded from income. Compare Treas. Reg. 1.457- 1(a)(3) with Treas. Reg. 1.457 -2(c), (e)(1). 4.03 Limited Catch -up: For one or more of the Participant's last r three taxable years ending before attaining Normal Retirement Age under the f) 41°- Plan, the maximum deferral shall be the lesser of (a) $15,000, reduced by any amount excludable from the Participant's gross income for that taxable year under section 403(b) of the Code on account of employer contributions, or (b) the sum of (i) the limitations established for purposes of section 4.02 of the Plan for such taxable year (determined without regard to this section 4.03), plus (ii) so much of the limitation established under section 4.02 of the Plan, or established in accordance with Treasury Regulation under an eligible deferred compensation plan (within the meaning of Section 457 of the Code and the regulations thereunder) sponsored by an entity other than the Employer and located in the State of Tnclia na [STATE WHERE EMPLOYER IS LOCATED], for prior taxable years (beginning after December 31, 1978 and during all or any portion of which the Participant was eligible to participate in this Plan or such other plan, respectively) as has not theretofore been used under section 4.02 or 4.03 hereof or under any other plan; Provided, however, that this section 4.03 shall not apply with respect to any Participant who has previously utilized in whole or in part the limited catch -up under this Plan or under any other eligible deferred compensation plan (within the meaning of Section 457 of the Code and the regulations thereunder). 4.04 The Employer or Administrator shall have the right to modify or disallow the periodic deferral of Compensation elected by the Participant: (a) In excess of the limitations stated in sections 4.02 and 4.03; (b) In excess of the Participant's net Compensation for any pay period; (c) Upon any change in the length of pay period utilized by Employer. In such case the periodic deferral shall be adjusted so that approximately the same whole dollar amount will be deferred on an annual basis; (d) In order to round periodic deferrals to the nearest whole dollar amount; (e) To reduce the future deferrals in the event that the amount actually deferred for any pay period exceeds, for any reason whatsoever, the amount elected by the Participant. In the alternative, such amount of excess deferral may be refunded to the Participant. No adjustment in future deferrals shall be made if a periodic deferral is missed or is less than the amount elected, for any reason whatsoever; or (f) If the deferral elected for any pay period is less than the minimum amount specified in section 4.01(b); Provided, however, that the Employer and the Administrator shall have no liability to any Participant or Beneficiary with respect to the exercise of, or the failure to exercise, the authority provided in this section 4.04. 4.05 A Participant may modify the Participation Agreement with respect to future amounts once during each open enrollment period authorized by the Administrator. 4.06 A Participant may at any time revoke his agreement to defer Compensation by filing a written request for revocation with the Administrator on a form approved by the Administrator, at least 15 days prior to the 0 r t,' effective date of the revocation. However, his Total Amount Deferred shall be distributed only as provided in Articles V and VI. A Participant's request for a distribution in the•event of an Unforeseeable Emergency shall in addition be treated as a request for revocation of deferrals as of a date determined by the Administrator. {NOTE: LAST SENTENCE MAY BE DELETED IF HARDSHIP DISTRIBUTIONS ARE NOT ALLOWED.] 4.07 A Participant who revokes his Participation Agreement as set forth in section 4.06 above may again become a Participant by executing in an open enrollment period authorized by the Administrator a new Participation Agreement to defer Compensation not yet earned. 4.08 Choice of Investments: Income will be accrued on amounts deferred under the Plan in accordance with the following procedure: (a) The Employer will in its sole discretion select certain investment options to be used to determine income to be accrued on deferrals. These investment options may include annuity contracts issued by Lincoln National Pension Insurance Company. (b) Each Participant will designate on his Participation Agreement the investment that will be used to determine the income to be accrued on amounts deferred by him. If the investment chosen by the Participant experiences a gain, the Participant's benefits under the Plan likewise will reflect income for that period. If the investment chosen by a Participant experiences a loss, or if charges are made under such investment, the Participant's benefits under the Plan likewise will reflect such loss or charge for that period. No Participant shall have any right, title, or interest in the assets so invested, however. See Article XII. (c) The Employer may from time to time change the investment options under the Plan. If the Employer eliminates a certain investment option, all Participants who had chosen that, investment select another option; the Participants will have no right to require the Employer to select or retain any investment option. To the extent permitted by and subject to any rules or procedures adopted by the Administrator, a Participant may from time to time change his choice of investment option. Any change with respect to investment options made by the Employer or a Participant, however, may affect only income to be accrued after that change in accordance with the terms and conditions (including rules or procedural requirements) of such investment options. 4.09 For convenience and to facilitate the orderly administration of the Plan, the Administrator shall maintain or cause to be maintained a deferred compensation ledger account or similar individual account for each Participant. Each Participant's account shall be credited with the amount of any Compensation deferred or amounts transferred pursuant to section 14.01; debited with any applicable administrative or investment expense, allocated on a reasonable and consistent basis; credited or debited with investment gain or loss, as appropriate; and debited with the amount of any distribution. (OPTIONAL: At least once a year each Participant will be notified in writing of his Total Amount Deferred.] V. DISTRIBUTIONS 5.01 Conditions for Distribution: (a) Subject to section 5.02 and 5.03, the Total Amount Deferred for a Participant shall be distributed: (i) Upon the Participant's actual retirement on or after attaining Normal Retirement Age, to the Participant; or (ii) Upon the Participant's other separation from service as defined in Section 402(e)(4)(A)(iii) of the Code, to the Participant; or (iii) Upon the Participant's death prior to the commencement of the distribution of his benefits, to his Beneficiary or Beneficiaries. (b) If a Participant dies after benefit payments have commenced, his Beneficiary or Beneficiaries shall be entitled to benefits, if any, determined by the settlement option agreed to in writing by the Participant and Administrator, subject to section 5.03(d). 5.02 Conditions for Distribution: (a) Distribution of benefits to a Participant or Beneficiary shall commence OPTION I on the first day of the second month ^�3, k s2 .t" v.J.r:U z:.s ^rx .t. rz., ^e A•�. r'.S'T• r.. i following the Participant's actual retirement described in section 5.01(a)(i), other separation from service described in section 5.01(a)(ii), or receipt by the Administrator of proof of the Participant's death, as relevant. However, with the consent of the Administrator, the Participant may elect to defer commencement of benefit payments pursuant to section 5.01(a)(i) or (ii) [OPTIONAL: and the Beneficiary may elect to defer commencement of benefit payments pursuant to section 5.01(a)(iii)] until a fixed or determinable date subsequent to the commencement date specified in the preceding sentence. Such election must be made•at n days prior to such commencement date and shall be irrevocable. In no event, however, shall benefit payments commence later than 60 days after the close of the Plan Year in which the Participant attains or would have attained Normal Retirement Age or separates from service with the Employer, whichever is later. (b) Notwithstanding any other provision of this Plan, any amount payable to a Participant who is or was an independent contractor shall not be paid OPTION I 30 prior to the expiration of the contract (or, in the case of more than one contract, all contracts) under which services are performed for the Employer, provided that such expiration constitutes a good faith and complete termination of the contractual relationship. Circumstances where there is not a good faith and complete termination of the contractual relationship include, without limitation, the following: (1) The Employer anticipates a renewal of the contractual relationship or the employment of the independent contractor; or (2) The Employer intends again to contract for the services provided under the expired contract(s) and neither the Employer nor •the independent contractor has eliminated the independent contractor as a possible provider of services under any such new contract. The Employer is considered to intend again to contract for such services if such contract is conditioned only upon the Employer's incurring a need for such services, or the availability of funds, or both. femme 5.03 Manner, Form and Period of Distributions: (a) Subject to section 5.02, the other subsections of this section 5.03, and the Administrator's approval, each Participant may elect the settlement option and payment period for each of the distributions specified in section 5.01(a)(i), (ii), and (iii) from among any alternatives offered by the Employer. Such election may be made or modified until the date 60 days prior to the time that benefit payments are to commence. The settlement options and payment periods available under the Plan, which shall be subject to section 5.03(d), are: [NOTE: SPECIFY PREFERRED SETTLEMENT OPTIONS, WHICH SHOULD BE CONSISTENT WITH INVESTMENT OPTIONS AND 5.03(d). THE FOLLOWING ARE COMMON SETTLEMENT OPTIONS.] (1) A lump sum distribution; (2) Annual or more frequent (but not more frequently than monthly) installments as nearly equal as practicable over a definite period; and (3) A life annuity. [(b) OPTIONAL: If the Total Amount Deferred is less than 3,500.00 or if a Participant has elected a settlement option for himself or his Beneficiary that requires installment or annuity payments of less than 50.00 per month, determined as of the date benefit payments are to commence, then notwithstanding any election made pursuant to subsection (a), the Administrator shall pay the Total Amount Deferred to the Participant or his Beneficiary in a single payment on the date payments are to commence.] (c) If a Participant does not effectively elect a settlement option and payment period for benefits payable under section 5.01(a)(i) or (ii), then such benefits shall be paid to the Participant in the form of a limp sum [NOTE: FORM SHOULD BE CONSISTENT WITH INVESTMENT OPTIONS AND 5.03(d).] If a Participant does not effectively elect a settlement option and payment period for benefits payable under section 5.01(a)(iii), then such benefits shall be paid in the following form: (1) Benefits payable to the Participant's surviving spouse shall be paid in the form of a life annuity; (2) Benefits payable to the Participant's estate shall be paid in a lump -sum distribution; and (3) Benefits payable to any other Beneficiary shall be paid in the form of a 15 -year certain annuity. (OPTIONAL: Provided, however, that, if the Participant has not elected the settlement option for benefits payable pursuant to section 5.01(a)(iii), then after the Participant's death but at least 90 days prior to the date benefit payments are to commence, the Beneficiary may elect (in the same manner as specified in and subject to the Administrator's approval and other restrictions contained in section 5.02(a)) to receive benefits in a different form than this subsection provides.] (d) The settlement option and payment period for any distribution to a Participant shall in all cases allocate more than fifty percent of the Total Amount Deferred to provide benefits payable to the Participant during his lifetime, determined by use of the expected return multiples contained in Treasury Regulation 1.72 -9 or, in the case of payments under a contract issued by an insurance company, by use of the mortality tables of such company. All distributions to the Beneficiary shall be paid over a period not longer than (a) the life of the Beneficiary, if the Beneficiary is the Participant's surviving spouse, or (b) 15 years, if the Beneficiary is not the Participant's surviving spouse. 3:. (5.04 OPTIONAL: With respect to benefits payable under section 5.01(b), the Beneficiary may, at the Administrator's discretion and to the extent permitted by the settlement option selected by the Participant, elect to defer commencement of such benefit payments. Such elections shall be made after the Participant's death put prior to the time any amounts become payable to the Beneficiary, and shall be subject to rules corresponding to those contained in sections 5.02 and 5.03.] [NOTE: THE OPTIONAL PROVISIONS IN 5.02(a) AND 5.03(c) ALLOW THE BENEFICIARY TO MAKE AN ELECTION IN THE ABSENCE OF A PARTICIPANT ELECTION, WHILE OPTIONAL 5.04 ALLOWS THE BENEFICIARY TO CHANGE THE ELECTION MADE BY THE PARTICIPANT.] 5.05 Beneficiary: Each Participant may designate in his Participation Agreement a Beneficiary or Beneficiaries to receive any amounts which may be distributed in the event of his death prior to the complete distribution of benefits. A Participant may change his designation of Beneficiaries at any time by filing with the Administrator a written notice on a form approved by the Administrator. If no such designation is in effect on a Participant's death, or if the designated Beneficiary does not survive the Participant (OPTIONAL: by 30 days], his Beneficiary shall be OPTION I his estate. OPTION II his surviving spouse, if any, and then his estate. OPTION III (SPECIFY PREFERRED BENEFICIARY]. VI. FINANCIAL HARDSHIP [OPTIONAL] Notwithstanding any other provision herein, in the event of an Unforeseeable Emergency as defined in section 2.14 hereof, a Participant may request that the Administrator pay to him all or a portion of his Total Amount Deferred to the date of payment. Such a request shall in addition be treated as a request for a revocation of deferrals, as provided in section 4.06. If the application for payment is approved by the Administrator, payment will be made within 14 days following such approval. Payment shall be limited strictly to that amount reasonably necessary to meet the situation constituting the Unforeseeable Emergency, and payments may not be made to the extent that a hardship is or may be relieved through reimbursement or compensation by insurance or otherwise, by liquidation of the Participant's assets (to the extent such liquidation does not itself cause severe financial hardship), or by cessation of deferrals under the Plan. Any remaining amounts shall be paid in accordance with Article V of the Plan. VII. LEAVE OF ABSENCE 7.01 If a Participant is on an approved leave of absence from the Employer with compensation, or on approved leave of absence without compensation for a period of not more than 1 (one) year [SPECIFY MAXIMUM LEAVE PERIOD WHICH IS NOT TREATED AS A TERMINATION, PREFERABLY ONE YEAR OR LESS], said Participant shall be deemed not to have separated from service with the Employer and his participation in the Plan may continue. 7.02 If a Participant is on an approved leave of absence without compensation and such leave of absence continues for more than 1 (one) year [PERIOD SPECIFIED ABOVE], said Participant shall have separated from service XII. ASSETS All amounts of Compensation deferred under the Plan, all property and rights purchased with such amounts, and all income attributable to such amounts, property or rights, shall remain (until made available to the Participant or his Beneficiary) solely the property and rights of the Employer and shall be subject only to the claims of general creditors of the Employer. XIII.DISCLAIMER WITH RESPECT TO INVESTMENTS The Employer and the Administrator make no endorsement, guarantee or any other representation and shall not be liable to the Plan or to any Participant, Beneficiary, or any other person with respect to the financial soundness, investment performance, fitness, or suitability (for meeting a Participant's objectives, future obligations under the Plan, or any other purpose) of any investment option offered pursuant to section 4.08 or any investment vehicle in which amounts deferred under the Plan are actually invested. XIV. PLAN -TO -PLAN TRANSFERS [OPTIONAL] 14.01 Transfers to the Plan: If a Participant was formerly a participant in an eligible deferred compensation plan (within the meaning of Section 457 of the Code and the regulations thereunder) sponsored by an entity located within the State of Tnriia na [STATE IN WHICH EMPLOYER IS LOCATED], and if such plan permits the direct transfer of the Participant's interest therein to the Plan, then the Plan shall accept assets representing the value of such interest; provided, however, that the Administrator may require in his, her or its sole discretion that some or all of such interest be transferred in cash or its equivalent. Such amount shall be held, accounted for, administered and otherwise treated in the same manner as Compensation deferred by the Participant under section 4.01 except that such amount shall not be considered Compensation deferred under the Plan in the taxable year of such transfer in determining the maximum deferral under sections 4.02 and 4.03. Income on such amounts shall be calculated in accordance with section 4.08 by the method designated by the Participant, including any subsequent election(s) to change methods, for determining income on Compensation deferred on the date of the transfer. 14.02 Transfers from the Plan: The Total Amount Deferred by a former Participant in the Plan may be transferred to another eligible 457 deferred compensation plan (within the meaning of Section 457 of the Code and the regulations thereunder) sponsored by an entity located within the State of Indiana [STATE IN WHICH EMPLOYER IS LOCATED] and in which the former Participant currently participates, if such plan provides for the acceptance of such amounts; provided, however, that if a Participant terminates his service with the Employer in order to accept employment with the entity sponsoring such plan and if such plan accepts transferred amounts, then payment of benefits under the Plan will not commence, regardless of any other provision of this Plan, and the Total Amount Deferred will 'automatically be transferred to such plan. [NOTE: THE PLAN -TO -PLAN TRANSFER PROVISIONS SHOULD BE CONSISTENT WITH ANY INVESTMENT OPTIONS.] 14.03 Administrative Rules: The Administrator shall prescribe such rules consistent with the provisions of sections 14.01 and 14.02 concerning plan -to -plan transfers as he, she or it in his, her or its sole judgment deems desirable for the orderly administration of the Plan. XV. EMPLOYER PARTICIPATION Notwithstanding any other provisions of this Plan, the Employer may add to the amounts payable to any Participant under the Plan additional Deferred Compensation for services to be rendered by the Participant to the Employer during a calendar month, provided: (a) The Participant has elected to have such additional Compensation deferred, invested, and distributed pursuant to this Plan, prior to the calendar month in which the Compensation is earned, and (b) Such additional Compensation deferred, when added to all other Compensation deferred under the Plan, does not exceed the maximum deferral permitted by Article IV. XVI. INTERPRETATION 16.01 This Plan shall be construed under the laws of the State of Indiana [STATE IN WHICH EMPLOYER IS LOCATED]. 16.02 This Plan is intended to be an eligible deferred compensation plan within the meaning of Section 457 of the Code, and shall be interpreted so as to be consistent with such Section and all regulations promulgated thereunder. 16.03 Word Usage: Words used herein in the singular shall include the plural and the plural and singular where applicable, and one gender shall include the other genders where appropriate. 16.04 Headings: The headings of articles, sections or other subdivisions hereof are included solely for convenience of reference, and if there is any conflict between such headings and the text of the Plan, the text shall control. 16.05. Counterparts: This instrument may be executed in several counterparts, each of which shall be deemed an original, and said counterparts shall constitute but one and the same instrument, which may be sufficiently evidenced by the counterpart. PASSED AND ADOPTED THIS 15 day of May 19 88. (NAME EMPLOYER] ATTEST• Mayor, C of Carmel /Clerk—Treasurer, Cit- of Carmel PLEASE SEE FOLLOWING PAGE FOR PLAN PROVISION CHANGES SPECIFIED BY THE TAX REFORM ACT OF 1986. Section 457 Plan •vision Changes �•1 (1) Previous law required that distributions taken as a series of scheduled payments provide for more than 50% of the total scheduled benefits to be payable to the participant. Tax Reform ups this "majority benefit" requirement to 66 2/3%. (2) Distributions taken in a series of payments must be made no less frquently than annually and the payment option must not result in substantially increasing periodic payment amounts. (3) Previous law did not permit distributions to be made to a participant while that participant was actively employed by the plan sponsor except for severe financial hardship requests. Tax Reform allows an actively employed participant to receive a lump sum payment under the following conditions: A) Payment must be made within 60 days of election to receive it; B) Total account value for the participant cannot exceed $3500; C) The employee may not again become a participant under the plan (although this does not appear to preclude future participation under a plan with a new employer). (4) Previous law allowed for plan to plan transfers only under the following conditions: (A) Both plans are located in the same state; (B) The plan documents specifically provide for such transfers; (C) Transfers are automatic; that is, the participant has no choice to receive any other form of distribution in such situation. The Tax Reform Act eliminates these restrictions on plan to plan transfers. Changes (1) and (2) above are effective for taxable years beginning after December 31, 1988. Changes (3) and (4) above are effective for years beginning after December 31, 1985.