The Summary Plan Description

THE SUMMARY PLAN DESCRIPTION

The Employee Retirement Income Security Act of 1974 (ERISA) and the Department of Labor require that each participant in a qualified retirement plan be given a summary of that plan. The summary must be in written format that can be easily understood by the average plan participant.

What follows is a sample Summary Plan Description (SPD) for your Basic[SM] Retirement Plan. In order to ensure that the requirements of ERISA are met, you must take the following important steps:

1. Prepare the SPD for your Plan using the sample as your guide. Choose those provisions that apply to your particular plan from the OPTIONS sections of the sample and insert the applicable information in the blank form fields. IF YOU MAINTAIN BOTH A PROFIT SHARING AND A MONEY PURCHASE PLAN, A SEPARATE SPD MUST BE PREPARED FOR EACH PLAN.

1. Distribute a copy of the completed SPD to all Participants and Beneficiaries in the Plan. Prior to distribution, this SPD should be reviewed with your attorney or tax advisor.

1. A copy of the final SPD should be kept in your permanent Plan file with a copy of the executed adoption agreement it represents.

1. An updated SPD must be distributed to all Participants and Beneficiaries every five years if amendments to the Plan have been made. If the Plan is amended, a Summary of Material Modifications must be provided to Participants and Beneficiaries within 210 days after the Plan Year in which the amendment occurred. Irrespective of any amendments, a completely restated SPD must be prepared and distributed to all Participants and Beneficiaries within 210 days after the end of the Plan Year which occurs 10 years after the last date a change in the information required to be disclosed would have been reflected in the SPD.

1. In some cases where a significant number of participants are non-English speakers and an English language SPD would fail to inform these participants adequately of their rights and obligations under the plan, foreign language assistance must be provided. This requirement applies in two cases: (1) to a plan that covers fewer than 100 participants at the beginning of a plan year, and in which 25 percent or more of all plan participants are literate only in the same non-English language; or (2) to a plan that covers 100 or more participants at the beginning of the plan year, and in which the lesser of (i) 500 or more participants, or (ii) 10% or more of all plan participants are literate only in the same non-English language. In these cases, the English-language SPD must “prominently” display a notice, in the non-English language common to these participants, offering them assistance. The assistance provided need not involve written materials, but must be given in the non-English language common to these participants and “calculated to provide them with a reasonable opportunity to become informed as to their rights and obligations under the plan.”

The SPD is an important plan document with legal and tax implications. Merrill Lynch, Pierce, Fenner & Smith Incorporated does not provide legal and tax advice to the Employer. The Employer is urged to consult with its own attorney with regard to the use of this Summary and its suitability to its circumstances.

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Summary Plan Description

for the

[Insert name of Basic Money Purchase Plan, and if different, also include the name by which the plan is commonly known by its participants and beneficiaries]

01/2016

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TABLE OF CONTENTS

I. Introduction to the Plan

II. General Information about the Plan

III. Eligibility and Participation

IV. Your Employer’s Contributions to the Plan

V. Investment of Contributions

VI. Vesting

VII. Your Benefits under the Plan

VIII. Qualified Domestic Relations Orders

IX. Payment of Expenses

X. Plan Amendment or Termination

XI. Statement of ERISA Rights

XII. Claims Procedures

XIII. Pension Benefit Guaranty Corporation

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I. INTRODUCTION TO THE PLAN

Your Employer has instituted this Plan to reward efforts made by Employees who contribute to the overall success of the company. The Plan is exclusively for the benefit of Participants and their Beneficiaries. The purpose of the Plan is to help you build financial security for your retirement and to help protect you and your Beneficiaries in the event of your death or Disability.

This Summary Plan Description (SPD) summarizes the key features of the Plan, and your rights, obligations and benefits under the Plan. Some of the statements made in this SPD are dependent upon this Plan being “qualified,” or approved by the Internal Revenue Service. Please contact your Plan Administrator with any questions you may have after you have read this summary.

The laws governing plans like this one contain many provisions that may affect your retirement. You should contact your Plan Administrator with any questions about the Plan before you make any decisions related to your retirement. For specific tax advice, you should contact your tax advisor.

Every effort has been made to make this description as accurate as possible. However, this booklet is not a Plan document. This SPD is not meant to interpret, extend or change the provisions of the Plan in any way. The terms of the Plan are stated in and will be governed in every respect by the Plan document, which supersedes any inconsistency in the SPD. Your right to any benefit depends on the actual facts and the terms and conditions of the Plan document, and no rights accrue by reason of any statement in this SPD. A copy of the Plan document is available at the principal office of your Employer for inspection by you, your Beneficiaries or your legal representatives at any reasonable time. You also have a right to a copy of the Plan document. For an explanation of your rights under federal law (ERISA), please refer to the “Statement of ERISA Rights” section of this SPD.

Nothing contained in this SPD creates or is intended to create a contract of employment between any Employee and the company. Nothing in the Plan or this SPD gives any person the right to be employed by the Employer nor does it interfere with the company’s right to discharge an Employee at any time. Generally, the terms and phrases that are capitalized in this SPD are defined in the Plan document.

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II. GENERAL INFORMATION ABOUT THE PLAN

There is certain general information you may need to know about the Plan. This section summarizes that information for you:

Employer/Plan Sponsor
Name:
Address:
Telephone Number:
Employer’s Tax I. D. Number (EIN#):
Plan Information
Plan Name:
Plan Number:
Plan Effective Date:
Plan Original Effective Date:
Plan Fiscal Year and Plan Year Ending Date [must be the same]:
Type of Plan: Defined Contribution – Money Purchase Plan
Type of Recordkeeping:
[Insert Appropriate Choice from the Options Below:
Option 1: If you have hired an outside recordkeeper:
“Contract Administration”
Option 2: If the recordkeeping is performed “in-house”:
“Self Administration”] / Plan Trustee(s)
Name:
Title:
Address:
[Insert Trustee(s) principal place of business address]
Telephone Number:
Plan Administrator
Name:
Address:
Telephone Number:
All Plan Records will be kept on the basis of the Plan Year.

The Trust Fund established for this Plan is the funding medium used for accumulation of assets and from which benefits will be distributed. The Plan Administrator keeps the records for the Plan, and is responsible for the interpretation and administration of the Plan. The Plan Administrator may engage the services of a third party record keeper to perform the administrative functions of the Plan. If you have any questions about the Plan, you should write to the Plan Administrator. The Plan Administrator and the Trustees are designated as the Agents for Service of Legal Process. [Option 1: If the service of process addresses are the addresses provided above: “Service of legal process may be made upon the Plan Trustee or the Plan Administrator at the addresses provided above.” Option 2: If the service of process addresses are different than the addresses provided above: “Service of Legal Process may be made upon the Plan Trustee or the Plan Administrator using the following addresses:

Plan Trustee / Plan Administrator
Address / Address
Phone / Phone”]

III. ELIGIBILITY AND PARTICIPATION

Eligibility:

All Employees of the Primary Employer are eligible to participate in this Plan, except Employees who are members of a union that bargained separately for retirement benefits that were subject to good faith bargaining during negotiations (unless the bargaining agreement provides for participation in the Plan) and non-resident aliens who receive no earned income from sources within the United States.

A “leased employee” is generally any person (other than a common law Employee of an Employer) who under an agreement between an Employer (or an Affiliate) and a leasing organization has performed services for the Employer (or an Affiliate) on a substantially fulltime basis for a period of at least 1 year. Such services must be performed under the primary direction or control of the Employer (or Affiliate). Leased Employees are Eligible Employees under the Plan once they have performed services for an Employer (or an Affiliate) on a substantially fulltime basis for a period of 1 year.

In all events, individuals who are not treated as common law employees by the Employer or any participating Employer of the Primary Employer on their payroll records (independent contractors) are excluded from Plan participation, even if a court or administrative agency later determines that these individuals are common law employees and not independent contractors.

If you are not excluded from participation due to the requirements listed above, you are considered to be an Eligible Employee for the Plan.

Participating Employers:

[Insert Appropriate Language from the Options Below:

Option 1:If only Employees of the Primary Employer can participate in the Plan, add the following sentence and insert the name of the Primary Employer:

“Only Eligible Employees of the [insert name of Primary Employer] may participate in the Plan.”

Option 2:If there are participating Employers (within the controlled group) in addition to the Primary Employer, insert the following sentence and then list the names of the Primary Employer and participating Employers:

“Only Eligible Employees of the following Employers may participate in the Plan: [insert eligible Employers]”]

Participation Requirements:

[Option 1: If the participation requirement is performance of one Hour of Service:

“If you are not excluded from participation due to the above Eligible Employee requirements, you will become eligible to participate in the Plan upon completing 1 Hour of Service. An Hour of Service is generally defined as any hour for which you are paid or are entitled to payment for services rendered to your Employer.

In all events, if you are covered by qualifying military service, you will be credited with service for your period of military service to the extent required by federal law.

If you do not meet the eligibility and participation requirements, you will not be eligible to participate in the Plan.”

Option 2: If the participation requirement has an age and/or service requirement:

“If you are not excluded from participation due to the above Eligible Employee requirements, you will become eligible to participate in the Plan upon attaining age _____ and completing _____ Year(s) of Service.”]

A “Year of Service” is a 12 consecutive month period, beginning on your date of hire, during which you complete 1,000 Hours of Service. An “Hour of Service” is generally defined as any hour for which you are paid or entitled to payment for services rendered to your Employer.

For example, if you have attained the required age and are hired on July 12, 2014, and you complete at least 1,000 Hours of Service on or before July 12, 2015, then you will be eligible to participate in the Plan on the next Entry Date (defined below) on or after July 12, 2015.

If you fail to complete 1,000 Hours of Service during your initial 12 months of employment, you may still complete a Year of Service by being credited with 1,000 Hours of Service during any subsequent 12-month period ending on your employment anniversary date.

In all events, if you are covered by qualifying military service, you will be credited with service for your period of military service to the extent required by federal law.

If you do not meet the eligibility and participation requirements, you will not be eligible to participate in the Plan.

Entry Date:

If you have satisfied the eligibility and participation requirements, you will become a Participant in the Plan on the Entry Date coincident with or next following the date you meet the participation requirements. The Entry Dates for this Plan are the first day of the Plan Year and the first day of the seventh month of the Plan Year.

Break in Service Rules:

If the Plan requires 1 Hour of Service for participation, the following Break in Service rules may not apply.

A Break in Service occurs during a Computation Period during which you have completed less than 501 Hours of Service for your Employer (or an Affiliate), except in the following circumstances:

Solely for purposes of determining whether a Break in Service has occurred in a Computation Period,(a 12 consecutive month period) if you are absent from work due to a maternity or paternity leave, you will receive credit for the Hours of Service that would have otherwise been credited to you but for that absence. In any case in which these hours cannot be determined, you will receive credit for 8 Hours of Service per day of that absence. These Hours of Service will be credited (1) in the Computation Period in which the absence begins if crediting is necessary to prevent a Break in Service in that period, or (2) in all other cases, the following Computation Period. A maternity or paternity leave of absence is one due to pregnancy, the birth or adoption of a child or the care of a child after birth or adoption.

If you are covered by qualifying military service, you will be credited with service for your period of military service to the extent required by federal law.

Reemployment after a Break in Service:

If you are reemployed after a “Break in Service,” the following rules apply to determine your eligibility upon reemployment:

If you never met the participation requirements of the Plan at the time of separation and do not incur 5 consecutive 1-year Breaks in Service, your total service is counted from your original date of hire. You may participate in the Plan in accordance with the Plan’s general participation requirements.

If you were a Participant in the Plan at the time of separation, you may participate immediately upon reemployment.

IV. CONTRIBUTIONS TO THE PLAN

Employer Contributions:

Contributions to your Plan are made by your Employer and are based on your Compensation. Compensation means the total salary or wages paid to you as shown on your W-2. The total Compensation that can be considered for contribution purposes for 2016is limited to $265,000*.

*Adjusted periodically for the cost of living by the Internal Revenue Service.

[INSERT APPROPRIATE LANGUAGE FROM THE OPTIONS BELOW:

Option 1: If your Money Purchase Plan is Non-Integrated:

“Each year, your Employer will contribute an amount to the Plan equal to [insert percentage not less than 3% and not more than 100%] of your Compensation for the Plan Year.”

Option 2: Integrated Money Purchase Plan using the Fixed Allocation Formula:

“Each year, your Employer will contribute [insert % not less than 3% - also called the “Base Contribution Percentage”] of each eligible Participant’s Compensation that is up to and including the Integration Level set forth below for the Plan Year plus [insert % not less than 3% and not to exceed the Base Contribution Percentage by more than the lesser of: the Base Contribution Percentage or 5.7%] of such Participant’s Compensation in excess of the Integration Level.

Definition of Integration Level:

The Integration Level is the Taxable Wage Base (TWB). The TWB is an amount determined annually by the IRS. The TWB for 2016is $118,500*.

*Adjusted periodically for the cost of living by the Internal Revenue Service.”

Option 3: Integrated Money Purchase Plan using the Floating Allocation Formula:

“Each year, your Employer will contribute a total amount equal to [insert % not less than 3%] of each eligible Employee’s Compensation for the Plan Year. This contribution will be allocated according to the following formula:

First, you will receive a portion of the contribution of up to 3% of your total Compensation.

Second, you will receive up to 3% of your Excess Compensation, if any. Excess Compensation is Compensation above the TWB in effect as of the first day of the Plan Year.

Third, you will receive up to 2.7% of your total Compensation and Excess Compensation, if any.