HomeMy WebLinkAboutReso - CC - 006-1999RESOLUTION NO. 6-1999
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BURLINGAME
APPROVING ICMA RETIREMENT CORPORATION AS A
COMPENSATION ADMINISTRATOR FOR THE CITY OF BURLINGAME, APPROVING
ADMINISTRATION AGREEMENT, AND ADOPTING DECLARATION OF TRUST AND
DEFERRED COMPENSATION PLAN
RESOLVED, by the City Council of the City of Burlingame:
WHEREAS, the City of Burlingame has established a Deferred Compensation program for
its employees; and
WHEREAS, ICMA Retirement Corporation is willing to be an administrator for the
program and has a strong record in providing these kinds of services to many cities throughout the
nation; and
WHEREAS, the City wishes to contract with ICMA Retirement Corporation to act as an
administrator for deferred compensation funds as designated by individual employees, and to allow
employees to invest in funds offered through the ICMA Retirement Trust,
NOW, THEREFORE, IT IS RESOLVED AND ORDERED:
1. The ICMA Retirement Corporation Deferred Compensation Plan and Trust attached
hereto as Exhibit A is approved.
2. The Declaration of Trust of the ICMA Retirement Trust attached hereto as Exhibit B is
approved, and the City Manager is authorized and directed to execute the Trust on behalf of the
City.
3. The assets of the Plan approved in this Resolution shall be held in trust, with the City
serving as trustee as provided by State and Federal law, for the exclusive benefit of the Plan
participants and their beneficiaries, and the assets shall not be diverted to any other purpose.
4. The Plan shall not permit loans.
5. The City Manager or the Manager's duly authorized representative shall be the
coordinator for this program; shall receive necessary reports, notices, and similar information from
the ICMA Retirement Corporation and the ICMA Retirement Trust; shall cast, on behalf of the City,
any required votes under the ICMA Retirement Trust; and is authorized to execute necessary
documents incidental to the administration of the Plan consistent with this Resolution.
MAYOR
I, JUDITH A. MALFATTI, City Clerk of the City of Burlingame, do hereby certify that the
foregoing resolution was introduced at a regular meeting of the City Council held on the 1 s t day of
FEBRUARY 1 1999, and was adopted thereafter by the following vote:
AYES: COUNCILMEMBERS: GALLIGAN, JANNEY, KNIGHT, O'MAHONY, SPINELLI
NOES: COUNCILMEMBERS: NONE
ABSENT: COUNCILMEMBERS: NONE
CITY CLE
2
ADMINISTRATIVE SERVICES AGREEMENT
Type: 457
Account Number: 4780
1w,
Plan # 4780
ADMINISTRATIVE SERVICES AGREEMENT
This Agreement, made as of the day of
199 , (herein referred to as the "Inception Date"), between The International
City Management Association Retirement Corporation ("RC"), a nonprofit corporation
organized and existing under the laws of the State of Delaware; and the City of
Burlingame ("Employer") a City organized and existing under the laws of the State of
California with an office at 501 Primrose Road, Burlingame, California 94010.
Recitals
Employer acts as a public plan sponsor for a retirement plan ("Plan") with
responsibility to obtain investment alternatives and services for employees
participating in that Plan;
The ICMA Retirement Trust (the "Trust") is a common law trust governed
by an elected Board of Trustees for the commingled investment of retirement funds
held by state and local governmental units for their employees;
RC acts as investment adviser to the Trust; RC has designed, and the
Trust offers, a series of separate funds (the "Funds") for the investment of plan
assets as referenced in the Trust's principal disclosure document, "Making Sound
Investment Decisions: A Retirement Investment Guide." The Funds are available
only to public employers and only through the Trust and RC.
In addition to serving as investment adviser to the Trust, RC provides a
complete offering of services to public. employers for the operation of employee
retirement plans including, but not limited to, communications concerning investment
alternatives, account maintenance, account record-keeping, investment and tax
reporting, form processing, benefit disbursement and asset management.
Agreements
1. Appointment of RC
Plan # 4780
Employer hereby designates RC as Administrator of the Plan to perform
all non -discretionary functions necessary for the administration of the Plan with
respect to assets in the Plan deposited with the Trust. The functions to be performed
by RC include:
(a) allocation in accordance with participant direction of individual
accounts to investment Funds offered by the Trust;
(b) maintenance of individual accounts for participants reflecting
amounts deferred, income, gain, or loss credited, and amounts disbursed as benefits;
(c) provision of periodic reports to the Employer and participants of the
status of Plan investments and individual accounts;
(d) communication to participants of information regarding their rights
and elections under the Plan; and
(e) disbursement of benefits as agent for the Employer in accordance
with terms of the Plan.
Employer has adopted the Declaration of Trust of the ICMA Retirement
Trust and agrees to the commingled investment of assets of the Plan within the Trust.
Employer agrees that operation of the Plan and investment, management and
disbursement of amounts deposited in the Trust shall be subject to the Declaration
of Trust, as it may be amended from time to time and shall also be subject to terms
and conditions set forth in disclosure documents (such as the Retirement Investment
Guide or Employer Bulletins) as those terms and conditions may be adjusted from time
to time. It is understood that the term "Employer Trust" as it is used in the
Declaration of Trust shall mean this Administrative Services Agreement.
3. Employer Duty to Furnish Information
Employer agrees to furnish to RC on a timely basis such information as
is necessary for RC to carry out its responsibilities as Administrator of the Plan,
including information needed to allocate individual participant accounts to Funds in
the Trust, and information as to the employment status of participants, and
participant ages, addresses and other identifying information (including tax
Plan # 4780
identification numbers). RC shall be entitled to rely upon the accuracy of any
information that is furnished to it by a responsible official of the Employer or any
information relating to an individual participant or beneficiary that is furnished by such
participant or beneficiary, and RC shall not be responsible for any error arising from
its reliance on such information. RC will provide account information in reports,
statements or accountings. All account discrepancies must be reported to RC within
120 days of the close of the quarter in which the discrepancy occurs. After that
time the report, statement, or accounting shall be deemed to have been accepted by
the Employer and the participants
RC represents and warrants to Employer that:
(a) RC is a non-profit corporation with full power and authority to enter
into this Agreement and to perform its obligations under this Agreement. The ability
of RC to serve as investment adviser to the Trust is dependent upon the continued
willingness of the Trust for RC to serve in that capacity.
(b) RC is an investment adviser registered as such with the Securities
and Exchange Commission under the Investment Advisers Act of 1940, as amended.
ICMA-RC Services, Inc. (a wholly owned subsidiary of RC) is registered as a broker-
dealer with the Securities and Exchange Commission (SEC) and is a member in good
standing of the National Association of Securities Dealers, Inc.
RC covenants with employer that:
(c) RC shall maintain and administer the Plan in compliance with the
requirements for eligible deferred compensation plans under Section 457 of the
Internal Revenue Code; provided, however, RC shall not be responsible for the eligible
status of the Plan in the event that the Employer directs RC to administer the Plan or
disburse assets in a manner inconsistent with the requirements of Section 457 or
otherwise causes the Plan not to be carried out in accordance with its terms;
provided, further, that if the plan document used by the Employer contains terms that
differ from the terms of RC's standardized plan document, RC shall not be responsible
for the eligible status of the Plan to the extent affected by the differing terms in the
Employer's plan document.
Employer represents and warrants to RC that:
(d) Employer is organized in the form and manner recited in the opening
paragraph of this Agreement with full power and authority to enter into and perform
its obligations under this Agreement and to act for the Plan and participants in the
Plan # 4780
manner contemplated in this Agreement. Execution, delivery, and performance of this
Agreement will not conflict with any law, rule, regulation or contract by which the
Employer is bound or to which it is a party.
.. .�RM V role
The Employer hereby authorizes RC to act as agent, to appear on its
behalf, and to join the Employer as a necessary party in all legal proceedings involving
the garnishment of benefits or the transfer of benefits pursuant to the divorce or
separation of participants in the Employer Plan. Unless Employer notifies RC
otherwise, Employer consents to the disbursement by RC of benefits that have been
garnished or transferred to a former spouse, spouse or child pursuant to a domestic
relations order.
(a) Plan Administration Fee. The amount to be paid for plan
administration services under this Agreement shall be 0.75% per annum of the
amount of Plan assets invested in the Trust. Such fee shall be computed based on
average daily net Plan assets in the Trust.
(b) Account Maintenance Fee. There shall be an annual account
maintenance fee of $18.00. The account maintenance fee is payable in full on
January 1 of each year on each account in existence on that date. For accounts
established after January 1, the fee is payable on the first day of the calendar quarter
following establishment and is prorated by reference to the number of calendar
quarters remaining on the day of payment. The annual account maintenance fee is
waived once assets greater than $4 million are rolled in to RC.
(c) Compensation for Management Services to the Trust. Employer
acknowledges that in addition to amounts payable under this Agreement, RC receives
fees from the Trust for investment management services furnished to the Trust,
except that this fee is not assessed in the Mutual Fund Series
(d) Mutual Fund Services Fee. There is an annual charge of 0.25% of
assets under management that are held in the Trust's Mutual Fund Series.
(e) Model Portfolio Fund Fee. There is an annual charge of 0.10% of
assets under management that are held in the Trust's Model Portfolio Funds.
(f) Payment Procedures. Ah1 payments to RC pursuant to this Section
6 shall be paid out of the Plan Assets held by the Trust and shall be paid by the Trust.
The amount of Plan Assets held in the Trust shall be .adjusted by the Trust as required
Plan # 4780
to reflect such payments.
7. Custody
Employer understands that amounts invested in the Trust are to be
remitted directly to the Trust in accordance with instructions provided to Employer
by RC and are not to be remitted to RC. In the event that any check or wire transfer
is incorrectly labeled or transferred to RC, RC will return it to Employer with proper
instructions.
RC shall not be responsible for any acts or omissions of any person other
than RC in connection with the administration or operation of the Plan.
9. Term
This Agreement may be terminated without penalty by either party on
sixty days advance notice in writing to the other.
•.0 �•
UORIMCHWU
(a) This Agreement may not be amended except by written instrument
signed by the parties.
(b) The parties agree that compensation for services under this
Agreement and administrative and operational arrangements may be adjusted as
follows:
RC may propose an adjustment by written notice to the Employer given
at least 60 days before the effective date of the adjustment and the notice may
appear in disclosure documents such as Employer Bulletins and the Retirement
Investment Guide. Such adjustment shall become effective unless, within the 60 day
period before the effective date the Employer notifies RC in writing that it does not
accept such adjustment, in which event the parties will negotiate with respect to the
adjustment.
(c) No failure to exercise and no delay in exercising any right, remedy,
power or privilege hereunder shall operate as a waiver of such right, remedy, power
or privilege.
Plan # 4780
11. Notices
All notices required to be delivered under Section 10 of this Agreement
shall be delivered personally or by registered or certified mail, postage prepaid, return
receipt requested, to (i) Legal Department, ICMA Retirement Corporation, 777 North
Capitol Street, N.E., Suite 600, Washington, D.C, 20002-4240; (ii) Employer at the
office set forth in the first paragraph hereof, or to any other address designated by
the party to receive the same by written notice similarly given.
12. Com le�greement
This Agreement shall constitute the sole agreement between RC and
Employer relating to the object of this Agreement and correctly sets forth the
complete rights, duties and obligations of each party to the other as of its date. Any
prior agreements, promises, negotiations or representations, verbal or otherwise, not
expressly set forth in this Agreement are of no force and effect.
13. Governing Law
This agreement shall be governed by and construed in accordance with
the laws of the State of California applicable to contracts made in that jurisdiction
without reference to its conflicts of laws provisions.
Plan # 4780
In Witness Whereof, the parties hereto have executed this Agreement
as of the Inception Date first above written.
CITY OF BURLINGAME
by:
Signature/Date
Name and Title (Please Print)
INTERNATIONAL CITY MANAGEMENT
ASSOCIATION RETIREMENT
CORPORATION
by:
Paul Gallagher/Date
Corporate Secretary
457 Plan Adoption Package Retain Document
Deferred Co nip ensation Plan Docu rnent and Trust. April 1998
APPENDIX A
DEFERRED COMPENSATION PLAN
& TRUST
Article 1. Purpose
The Employer hereby establishes the Employer's deferred
Compensation Plan and Trust, hereafter referred to as the
"Plan." The Plan consists of the provisions set forth in this
document.
The primary purpose of this Plan is to provide retirement
income and other deferred benefits to the Employees of the
Employer and the Employees' Beneficiaries in accordance
with the provisions of Section 457 of the Internal Revenue
Code of 1986, as amended (the "Code").
This Plan shall be an agreement solely between the Em-
ployer and participating Employees. The Plan and Trust
fanning a part hereof are established and shall be maintained
for the exclusive benefit of eligible Employees and their
Beneficiaries. No part of the corpus or income of the Trust
shall revert to the Employer or be used for or diverted to
purposed other than the exclusive benefit of Participants and
their Beneficiaries.
Article II. Definitions
2.01 Account: The bookkeeping account maintained for
each Participant reflecting the cumulative amount of the
Participant's Deferred Compensation, including any income,
gains, losses, or increases or decreases in market value
attributable to the Employer's investment of the Participant's
Deferred Compensation, and further reflecting any distribu-
tions to the Participant or the Participant's Beneficiary and
any fees or expenses charged against such Participant's
Deferred Compensation.
2.02 Accounting Date: Each business day that the New
York Stock Exchange is open for trading, as provided in
Section 6.06 for valuing the Trusts assets.
2.03 Administrator: The person or persons named to carry
out certain nondiscretionary administrative functions under
the Plan, as hereinafter. described. The Employer may
remove any person as Administrator upon 60 days' advance
notice in writing to such person, in which case the Em-
ployer shall name another person or persons to act as
.Administrator. The Administrator may resign upon 60 days'
advance notice in writing to the Employer, in which case
the Employer shall name another person or persons to act as
Administrator.
2.04 Beneficiary: The person or persons designated by the
Participant in his Joinder Agreement who shall receive any
benefits payable hereunder in the event of the Participant's
death. In the event that the Participant names two or more
Beneficiaries, each Beneficiary shall be entitled to equal
shares of the benefits payable at the Participant's death, unless
otherwise provided in the Participant's Joinder Agreement. If
no beneficiary is designated in the Joinder Agreements if the
Designated Beneficiary predeceases the Participant, or if the
designated Beneficiary does not survive the Participant for a
period of fifteen (15) days, then the estate of the Participant
shall be the Beneficiary.
2.05. Deferred Compensation: The amount of Normal
Compensation otherwise payable to the Participant which
the Participant and the Employer mutually agree to defer
hereunder, any amount credited to a Participant's Account
by reason of a transfer under section 6.09, or any other
amount which the Employer agrees to credit to a
Participant's Account.
2.06 Employee: Any individual who provides services for
the Employer, whether as an employee of the Employer or
as an independent contractor, and who. has been designated
by the Employer as eligible to participate in the Plan.
2.07 Includible Compensation: The amount of an
Employee's compensation from the Employer for a taxable
year that is attributable to services performed for the
Employer and that is includible in the Employee's gross
income for the taxable year for federal income tax purposes;
such term does not include any amount excludable from
gross income under this Plan or any other plan described in
Section 457(b) of the Code or any other amount excludable
from gross income for federal income tax purposes. Includ-
ible Compensation shall be determined without regard to
any community property laws.
2.08 Joinder Agreement: An agreement entered into
between an Employee and the Employer, including any
amendments or modifications thereof. Such agreement shall
fix the amount of Deferred Compensation, specify a prefer-
ence among the investment alternatives designated by the
Employer, designate the Employee's Beneficiary or Benefi-
ciaries, and incorporate the temps, conditions, and provisions
of the Plan by reference.
ICMA RETIREMENT CORPORATION
2.09 Normal Compensation: The amount of Conn
pensation which would be payable to a Participant by the
Employer for a taxable year if no Joinder Agreement were in
effect to defer compensation under this Plan.
2.10 Normal Retirement Age: Age 70-1/2, unless the
Participant has elected an alternate Normal Retirement Age
by written instrument delivered to the Administrator prior
to Separation from Service. A Participants Normal Retire-
ment Age detennines the period during which a Participant
may utilize the catch-up limitation of Section 5.02 hereun-
der. Once a Participant has to any extent utilized the catch-
up limitation of Section 5.02, his Nonual Retirement Age
may not be changed.
A Participants alternate Nonnal Retirement Age may not
be earlier than the earliest date that the Participant will
become eligible to retire and receive unreduced retirement
benefits under the Employer's basic retirement plan covering
the Participant and may not be later than the date the
Participant will attain age 70-1/2. If a Participant continues
employment after attaining age 70 - l /2, not having previ-
ously elected alternate Nonnal Retirement Age, the
Participant's alternate Normal Retirement Age shall not be
later than the mandatory retirement age, if any, established
by the Employer, or the age at which the Participant actually
separates from service if the Employer has no mandatory
retirement age. If the Participant will not become eligible to
receive benefits under a basic retirement plan maintained by
the Employer, the Participant's alternate Nonnal Retirement
Age may not be earlier than age 55 and may not be later
than age 70-1/2.
2.11 Participant: Any Employee who has joined the Plan
pursuant to the requirements of Article IV.
2.12 Plan Year: The calendar year.
2.13 Retirement: The first date upon which both of the
following shall have occurred with respect to a participant:
Separation from Service and attainment of age 65.
2.14 Separation From Service: Severance of the
Participants employment with the Employer which consti-
tutes a "separation from service" within the meaning of
Section 402 (d) (4) (A) (iii) of the Code. In general, a
Participant shall be deemed to have severed his employment
with the Employer for purposes of this Plan when, in
accordance with the established practices of the Employer,
the employment relationship is considered to have actually
terminated. In the case of a Participant who is an indepen-
dent contractor of the Employer, Separation from Service
shall be deemed to have occurred when the Participant's
contract under which services are performed has completely
expired and terminated, there is no foreseeable possibility
that the Employer will renew the contract or entet into a
new contract for the participant's services, and is not antici-
pated that the participant will become an Employee of the
Employer.
2.15 Trust: The Trust created under Article VI of the Plan
which shall consist of all compensation deferred under the
Plan, plus any income and gains thereon, less any losses,
expenses and distributions to Participants and Beneficiaries.
Article 111. Administration
3.01 Duties of the Employer: The Employer shall have
the authority to make all discretionary decisions affecting the
rights or benefits of Participants which may be required in
the administration of this Plan. The Employer's decisions
shall be afforded the maximum deference permitted by
applicable law.
3.02 Duties of Administrator: The Administrator, as
agent for the Employer, shall perform nondiscretionary
administrative functions in connection with the Plan,
including the maintenance of Participants' Accounts, the
provision of periodic reports of the status of each Account,
and the disbursement of benefits on behalf of the Employer
in accordance with the provisions of this Plan.
Article IV. Participation in the Plan
.4.01 Initial Participation: An Employee may become a
Participant by entering into a Joinder Agreement prior to the
beginning of the calendar month in which the Joinder
Agreement is to become effective to defer compensation not
yet earned.
4.02 Amendment of Joinder Agreement: A Participant
may amend an executed Joinder Agreement to change the
amount of compensation not yet eamed which is to be
deferred (including the reduction of such future deferrals to
zero) or to change his investment preference (subject to such
restrictions as may result from the nature of tens of any
investment made by the Employer). Such amendment shall
become effective as of the beginning of the calendar month
commencing after the date the amendment is executed. A
Participant may at any time amend his Joinder Agreement to
change the designated Beneficiary, and such amendment
shall become effective immediately.
457 Plan Adoption Package Retain Docum en(
Deferred Compensation Plan Document, April 1998
Article V. Limitations on Deferrals
5.01 Normal Limitation: Except as provided in section
5.02, the maximum amount of Deferred Compensation for
any Participant for any taxable year shall not exceed the
lesser of $7,500.00, as adjusted for the cost -of -living in
accordance with Code section 457(e)(15) for taxable years
beginning after December 31, 1996 (the "dollar limitation"),
or 33-1/3 percent of the participant's Includible Compensa-
tion for the taxable year. This limitation will ordinarily be
equivalent to the lesser of the dollar limitation in effect for
the taxable year or 25 percent of the Participant's Normal
Compensation.
5.02 Catch -Up Limitation: For each of the last three (3)
taxable years of a Participant ending before his attainment of
Nonnal Retirement Age, the maximum amount of Deferred
Compensation shall be the lesser of: (1) $15,000 or (2) the
sum of (i) the Normal Limitation for the taxable year, and
(ii) the Nonnal Limitation for each prior taxable year of the
Participant commencing after 1978 less the amount of the
Participant's Deferred Compensation for such prior taxable
years. A prior taxable year shall be taken into account under
the preceding sentence only if (i) the Participant was eligible
to participate in the Plan for such year (or in any other
eligible deferred compensation plan established under
Section 457 of the Code which is properly taken into
account pursuant to regulations under section 457), and (ii)
compensation (if any) deferred under the Plan (or such other
plan) was subject to the deferral limitations set forth in
Section 5.01
5.03 Other Plans: The amount excludable from a
Participants gross income under this Plan or any other
eligible deferred compensation plan under section 457 of the
Code shall not exceed $7,500.00 (or such greater amount
allowed under Sections 5.01 or 5.02 of the Plan), less any
amount excluded from gross income under section 403(b),
402(a)(8), or 402(h)(1)(B) of the Code, or any amount with
respect to which a deduction is allowable by reason of a
contribution to an organization described in section 501 .
(c)(18) of the Code.
Article VI. Trust and Investment
of Accounts
6.01 Investment of Deferred Compensation: A Trust is
hereby created to hold all the assets of the Plan for the
exclusive benefit of Participants and Beneficiaries, except
that expenses and taxes may be paid from the Trust as
provided in Section 6.03. The trustee shall be the Employer
or such other person which agrees to act in that capacity
hereunder.
6.02 Investment Powers: The trustee or the Plan
Administrator, acting as agent for the trustee, shall have the
powers listed in this Section with respect to investment of
Trust assets, except to the extent that the investment of
Trust assets is directed by Participants, pursuant to Section
6.05.
(a) To invest and reinvest the Trust without distinction
between principal and income in common or preferred
stocks, shares of regulated investment companies and other
mutual funds, bonds, loans, notes, debentures, certificates of
deposit, contracts with insurance companies including but
not limited to insurance, individual or group annuity,
deposit administration, guaranteed interest contracts, and
deposits at reasonable rates of interest at banking institutions
including but not limited to savings accounts and certificates
of deposit. Assets of the Trust may be invested in securities
that involve a higher degree of risk than investments that
have demonstrated their investment performance over an
extended period of time.
(b) To invest and reinvest all or any part of the
assets of the Trust in any common, collective or
commingled trust fund that is maintained by a bank.
or other institution and that is available to Em-
ployee plans described under sections 457 or 401 of
the Code, or any successor provisions thereto, and
during the period of time that an investment
through any such medium shall exist, to the extent
of participation of the Plans the declaration of trust
of such commonly collective, or commingled trust
fund shall constitute a part of this Plan.
............................................................................................................
Three
ICMA RETIREMENT CORPORATION
(c) To invest and reinvest all or any part of the assets of the
Trust in any group annuity, deposit administration or
guaranteed interest contract issued by an insurance company
or other financial institution on a commingled or collective
basis with the assets of any other 457 plan or trust qualified
under section 401(a) of the Code or any other plan de-
scribed in section 401 (a)(24) of the Code, and such con-
tract may be held or issued in the name of the Plan Admin-
istrator, or such custodian as the Plan Administrator may
appoint, as agent and nominee for the Employer. During
the period that an investment through any such contract
shall exist, to the extent of participation of the Plan, the
terms and conditionsofsuch contract shall constitute a part
of the Plan.
(d) To hold cash awaiting investment and to keep such
portion of the Trust in cash or cash balances, without
liability for interest, in such amounts as may from time to
time be deemed to be reasonable and necessary to meet
obligations under the Plan or otherwise to be in the best
interests of the Plan.
(e) To hold, to authorize the holding of, and to register any
investment to the Trust in the name of the Plan, the
Employer, or any nominee or agent of any of the foregoing,
including the Plan Administrator, or in bearer form, to
deposit or arrange for the deposit of securities in a qualified
central depository even though, when so deposited, such
securities may be merged and held in bulk in the name of
the nominee of such depository with other securities
deposited therein by any other person, and to organize
corporations or trusts under the laws of any jurisdiction for
the purpose ofacquiring or holding title to any property for
the Trust, all with or without the addition of words or
other action to indicate that property is held in a fiduciary
or representative capacity but the books and records of the
Plan shall at all times show that all such investments are part
of the Trust.
(0 Upon such terns as may be deemed advisable by the
Employer or the Plan Administrator, as the case may be, for
the protection of the interests of the Plan or for the preser-
vation of the value of an investment, to exercise and enforce
by suit for legal or equitable remedies or by other action, or
to waive any right or claim on behalf of the Plan or any
default in any obligation owing to the Plan, to renew,
extend the time for payment of, agree to a reduction in the
rate of interest on, or agree to any other modification or
change in the terms of any obligation owing to the Plan, to
settle, compromise, adjust, or submit to arbitration any
claim or right in favor of or against the Plans to exercise and
enforce any and all rights of foreclosure, bid for property in
foreclosure, and take a deed in lieu of foreclosure with or
without paying consideration therefor, to commence or
defend suits or other legal proceedings whenever any interest
of the Plan requires it, and to represent the Plan in all suits
or legal proceedings in any court of law or equity or before
any body or tribunal.
(g) To employ suitable consultants, depositories, agents, and
legal counsel on behalf of the Plan.
(h) To open and maintain any bank account or accounts in
the name of the Plan, the Employer, or any nominee or
agent of the foregoing, including the Plan Administrator, in
any bank or banks.
(i) To do any and all other acts that may be deemed neces-
sary to carry out any of the powers set forth herein.
6.03 Taxes and Expenses: All taxes of any and all kinds
whatsoever that may be levied or assessed under existing or
future laws upon, or in respect to the Trust, or the income
thereof, and all commissions or acquisitions or dispositions of
securities and similar expenses of investment and reinvest-
ment of the Trust, shall be paid from the Trust. Such
reasonable compensation of the Plan Administrator, as may
be agreed upon from time to time by the Employer and the
Plan Administrator, and reimbursement for reasonable
expenses incurred by the Plan Administrator in performance
of its duties hereunder (including but not limited to fees for
legal, accounting, investment and custodial services) shall
also be paid from the Trust.
6.04 Payment of Benefits: The payment of benefits
from the Trust in accordance with the terns of the Plan
may be made by the Plan Administrator, or by any custodian
or other person so authorized by the Employer to make such
disbursement. The Plan Administrator, custodian or other
person shall not be liable with respect to any distribution of
Trust assets made at the direction of the Employer.
6.05 Investment Funds: In accordance with uniform and
nondiscriminatory rules established by the Employer and the
Plan Administrator, the Participant may direct his/her
Accounts to be invested in one (1) or more investment funds
available under the Plan; provided, however, that the
Participant's investment directions shall not violate any
investment restrictions established by the Employer. Neither
the Employer, the Administrator, nor any other person shall
be liable for any losses incurred by virtue of following such
directions or with any reasonable administrative delay in
implementing such directions.
..............................................................................................................
Four
457 Plan Adoption Package Retain Daturn nut
Deferred Coatpeusation Plan Document, April 1998
6.06 Valuation of Accounts: As of each Accounting Date,
the Plan assets held in each investment fund offered shall be
valued at fair market value and the investment income and
gains or losses for each fund shall be determined. Such
investment income and gains or losses shall be allocated
proportionately among all Account balances on a fund -by -
fund basis. The allocation shall be in the proportion that
each such Account balance as of the immediately preceding
Accounting Date bears to the total of all such Account
balances as of that Accounting Date. For purposes of this
Article, all Account balances include the Account balances of
all Participants and Beneficiaries.
6.07 Participant Loan Accounts: Participant Loan
Accounts shall be invested in accordance with Section 8.03
of the Plan. Such Accounts shall not share in any investment
income and gains or losses of the investment funds described
in Sections 6.05 and 6.06.
6.08 Crediting of Accounts: The Participant's Account
shall reflect the amount and value of the investments or
other property obtained by the Employer through the
invesunent of the Participant's Deferred Compensation
pursuant to Sections 6.05 and 6.06. It is anticipated that the
Employer's investments with respect to a Participant will
conform to the investment preference specified in the
Participant's Joinder Agreement, but nothing herein shall be
construed to require the Employer to [Hake any particular
investment of a Participant's Deferred Compensation. Each
Participant shall receive periodic reports, not less frequently
than annually, showing the then current value of his/her
Account.
6.09 Transfers: .
(a) incoming Transfers: A transfer may be accepted from an
eligible deferred compensation plan maintained by another
employer and credited to a Participant's Account under the
Plan if (1) the Participant has separated from service with that
employer and become an Employee of the Employer, and
(ii) the other employer's plan provides that such transfer will
be made. The Employer may require such documentation
from the predecessor plan as it deems necessary to effectuate
the transfer, to confrin that such plan is an eligible deferred
compensation plan within the meaning of Section 457 of the
Code, and to assure that transfers are provided for under
such plan. The Employer may refuse to accept a transfer in
the form of assets other than cash, unless the Employer and
the Administrator agree to hold such other assets tinder the
Plan.
Any such transferred amount shall be treated as a deferral
subject to the limitations of Article V, except that, for
purposes of applying the limitations of Sections 5.01 and
5.02, an amount deferred during any taxable year under the
plan from which the transfer is accepted shall be treated as if
it has been deferred under this Plan during such taxable year
and compensation paid by the transferor employer shall be
treated as if it had been paid by the Employer.
(b) Outgoing Transfers: An amount may be transferred to an
eligible deferred compensation plan maintained by another
employer, and charged to a Participant's Account under this
Plan, if (i) the Participant has separated from service with the
Employer and become an employee of the other employer,
(ii) the other employer's plan provides that such transfer will
be accepted, and (iii) the Participant and the employers have
signed such agreements as are necessary to assure that the
Employer's liability to pay benefits to the Participant has
been discharged and assumed by the other employer. The
Employer may require such documentation from the other
plan as it deems necessary to effectuate the transfer, to
confirm that such plan is an eligible deferred compensation
plan within the meaning of section 457 of the Code, and to
assure that transfers are provided for under such plan. Such
transfers shall be made only under such circumstances as are
pemhitted under section 457 of the Code and the regulations
thereunder.
6.10 Employer Liability: In no event shall the Employer's
liability to pay benefits to a Participant under this Plan
exceed the value of the amounts credited to the Participant's
Account neither the Employer nor the Administrator shall
be liable for losses arising from depreciation or shrinkage in
the value of any investments acquired under this Plan_
.............................................................................................................
Fi rr
ICMA RETIREMENT CORPORATION
Article VII. Benefits
7.01 Retirement Benefits and Election on Separation
from Service: Except as otherwise provided in this Article
VII, the distribution of a Participants Account shall com-
mence as of April 1 of the calendar year after the Plan Year
of the Participant's Retirement, and the distribution of such
Retirement benefits shall be made in accordance with one of
the payment options described in Section 7.02. Notwith-
standing the foregoing, but subject to the following para-
graph of this Section 7.01, the Participant may irrevocably
elect within 60 days following Separation from Service to
have the distribution of benefits commence on a fixed
determinable date other than that described in the preceding
sentence which is at least 61 days after Separation from
Service, but not later than April l of the year following the
year of the Participant's Retirement or attainment of age 70-
1/2, whichever is later. Notwithstanding the foregoing
provisions of this Section 7.01, no election to defer the
commencement of benefits after a separation from service
shall operate to defer the distribution of any amount in the
Participant's Loan Account in the event of a default of the
Participant's loan.
Effective on or after January 1, 1997, the Participant may
elect to defer the commencement of distribution of benefits
to a fixed determinable date later than the date described
above, but not later than April 1 of the year following the
year of the Participant's retirement or attainment of age 70-
1/2, whichever is later, provided (a) such election is made
after the 61st day following Separation from Service and
before commencerttent of distributions and (b) the Partici-
pant may make only one (1) such election. Notwithstanding
the foregoing, the Administrator, in order to ensure the
orderly administration of this provision, may establish a
deadline after which such election to defer the conunence-
ment of distribution of benefits shall not be allowed.
7.02 Payment Options: As provided in Sections 7.01, 7.04
and 7.05, a Participant or Beneficiary may elect to have value
of the Participant's Account distributed in accordance with
one of the following payment options, provided that such
option is consistent with the limitations set forth in Section
7.03.
(a) Equal monthly, quarterly, semi-annual or annual pay-
ments in an amount chosen by the Participant, continuing
until his/her Account is exhausted;
(b) One lump -sun- payment;
(c) Approximately equal monthly, quarterly, semi-annual or
annual payments, calculated to continue for a period certain
chosen by the Participant.
(d) Annual Payments equal to the minimum distributions
required under Section 401(x)(9) of the Code over the life
expectancy of the Participant or over the life expectancies of
the Participant and his Beneficiary.
(e) Payments equal to payments made by the issuer of a
retirement annuity policy acquired by the Employer.
(f) A split distribution under which payments under options
(a), (b), (c) or (e) commence or are made at the same time, as
elected by the Participant under Section 7.01, provided that
all payments commence (or are made) by the latest benefit
commencement date under Section 7.01 and that once a
payment is made subsequent payments will be made in
substantially nonincreasing amounts.
(g) Any payment option elected by the Participant and
agreed to by the Employer and Administrator, provided that
such option must provide for substantially nonincreasing
payments for any period after the benefit commencement
date under Section 7.01.
A Participant's or Beneficiary's selection of a payment option
made after December 31, 1995, under Subsections (a), (c), or
(g) above may include the selection of an automatic annual
cost -of -living increase. Such increase will be based on the
rise in the Consumer Price Index for All Urban Consumers
(CPI -U) from the third quarter of the last year in which a
cost -of -living increase was provided to the third quarter of
the current year. Any increase will be made in periodic
payment checks beginning the following January. The first
cost -of -living increase will be based on the rise in the CPI -U
from the third quarter of 1995 to the third quarter of 1996,
and will be applied to amounts paid beginning January 1997.
A Participant's or Beneficiary's election of a payment option
must be [Wade at least 30 days before the payment of benefits
is to commence. If a Participant or Beneficiary fails to make
a timely election of a payment option, benefits shall be paid
monthly under option (c) above for a period of five years or
such shorter period of time necessary to ensure that the
amount of any installment is not less than $1,200 per year,
without the inclusion of a cost -of -living increase.
.......................................
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457 P a n'Ado p Iioil Park age Retain Doc mat enl
Declaraliou of Trust of the ICMA Retirement Trust, April 1998
7.03 Limitation on Options: No payment option may be
selected by a Participant under subsections 7.02(a) or (c)
unless the amount of any installment is not less than $1,200
per year. No payment option may be selected by a Partici-
pant or Beneficiary under Sections 7.02, 7.04, or 7.05 unless
it satisfies the requirements of Sections 401(a)(9) and
457(d)(2) of the Code, including that payments commencing
before the death of the Participant shall satisfy the incidental
death benefits requirement under section 457(d)(2)(13)(i)(1).
A cost -of -living increase included as part of a payment
option selected under Section 7.02 shall not be considered to
fail to satisfy the requirement under section 457(d)(2)(b)
that any distribution made over a period of more than one
year can only be [Wade in substantially nonincreasing
amounts. Unless otherwise elected by the Participant (or
spouse, in the case of distributions described in Section 7.05
below) by the time distributions are required to begin, life
expectancies shall be recalculated annually. Such election
shall be irrevocable as to the Participant (or spouse) and shall
apply to all subsequent years. The life expectancy of a
nonspouse Beneficiary may not be recalculated.
7.04 Post-retirement Death Benefits:
(a) Should the Participant die after he/she has begun to
receive benefits under a payment option, the remaining
payments, if any, under the payment option shall be payable
to the participant's Beneficiary within the 30 -day period
commencing with the 61st day after the Participant's death,
unless the Beneficiary elects payment under a different pay-
ment option that is available under Section 7.02 within 60
days of the Participant's death. Any different payment option
elected by a Beneficiary under this section must provide for
payments at a rate that is at least as rapid under the payment
option that was applicable to the Participant. In no event
shall the Employer or Administrator be liable to the Benefi-
ciary for the amount of any payment made in the name of
the Participant before the Administrator receives proof of
death of the Participant.
(b) If the designated Beneficiary does not continue to live for
the remaining period of payments under the payment
option, then the commuted value of any remaining pay-
ments under the payment option shall be paid in a lump sum
to the estate of the Beneficiary. In the event that the
Participant's estate is the Beneficiary, the commuted value of
any remaining payments under the payment option shall
be paid to the estate in a lump sunt.
7.05 Pre -retirement Death Benefits:
(a) Should the Participant die before he has begun to receive
the benefits provided by Section 7.01, the value of the
Participant's Account shall be payable to the Beneficiary
commencing within the 30 -day period commencing on the
91st day after the Participant's death, unless the Beneficiary
elects a different fixed or determinable benefit commence—
ment date within 90 days of the Participant's death. Such
benefit commencement date shall be not later than the later
of (i) December 31 of the year following the year of the
participant's death, or (ii) if the Beneficiary is the
Participant's spouse, December 31 of the year in which the
Participant would have attained age 70-1/2-
(b) Unless a Beneficiary elects a different payment option
prior to the benefit commencement date, death benefits
under this Section shall be paid in approximately equal
annual installments over five years, or over such shorter
period as may be necessary to assure that the amount of any
annual installment is not less than $3,500. A Beneficiary shall
be treated as if he/she were a Participant for purposes of
detennining the payment options available under Section
7.02, provided, however, that the payment option chosen by
the Beneficiary must provide for payments to the Beneficiary
over a period no longer than the life expectancy of the
Beneficiary, and provided that such period may not exceed
(15) years if the Beneficiary is not the Participant's spouse_
(c) In the event that the Beneficiary dies before the payment
of death benefits has commenced or been completed, the
remaining value of the Participant's Account shall be paid to
the estate of the Beneficiary in a lump sum. In the event that
the Participant's estate is the Beneficiary, payment shall be
made to the estate in a lump sum.
7.06 Unforeseeable Emergencies:
(a) In the event an unforeseeable emergency occurs,
a Participant may apply to the Employer to receive
that part of the value of his/her Account that is
reasonably needed to satisfy the emergency need. If
such an application is approved by the Employer,
the Participant shall be paid only such amount as the
Employer deems necessary to meet the emergency
need, but payment shall not be made to the extent
that the financial hardship may be relieved through
cessation of deferral under the Plan, insurance or
other reimbursement, or liquidation of other assets
to the extent such liquidation would not itself cause
severe financial hardship.
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Serra
ICMA RETIREMENT CORPORATION
(b) An unforeseeable emergency shall be deemed to involve
only circumstances of severe financial hardship to the
Participant resulting from a sudden unexpected illness,
accident, or disability 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 and extraordinary 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 to
purchase a new home shall not be considered unforeseeable
emergencies. The determination as to whether such an
unforeseeable emergency exists shall be based on the merits
of each individual case.
7.07 Transitional Rule for Pre -1989 Benefit Elections:
In the event that, prior to January 1, 1989, a Participant or
Beneficiary has commenced receiving benefits under a
payment option or has irrevocably elected a payment option
or benefit commnmencement date, then that payment option or
election shall retrain in effect notwithstanding any other
provision of the Plan.
7.08 De Minimis Accounts: Notwithstanding the forego-
ing provisions of this Article, if the value of a Participant's
Account does not exceed the dollar limit under section
411(a) (11) (A) of the Code and (a) no amount has been
deferred under the Plan with respect to the Participant
during the 2 -year period ending on the date of the distribu-
tion and (b) there has been no prior distribution under the
Plan to the Participant pursuant to this Section 7.08, the
Participant may elect to receive or the Employer may
distribute the participant's entire Account without the
consent of the Participant. Such distribution shall be made in
a lunp sum.
Article Vlll. Loans to Participants
8.01 Availability of Loans to Participants:
(a) Effective January 1, 1997, the Employer may elect to
make loans available to Participants in this Plan. If the
Employer has elected to make loans available to Participants,
a Participant may apply for a loan from the Plan subject to
the limitations and other provisions of this Article.
(b) The Employer shall establish written guidelines govern-
ing the granting of loans, provided that such guidelines are
approved by the Plan Administrator and are not inconsistent
with the provisions of this Article, *and that loans are made
available to all Participants on a reasonably equivalent basis.
8.02 Terms and Conditions of Loans to Participants:
Any loan by the Plan to a Participant under Section 8.01 of
the Plan shall satisfy the following requirements:
(a) Availability. Loans shall be made available to all Partici-
pants on a reasonably equivalent basis.
(b) Interest Rate. Loans must be adequately secured and bear
a reasonable interest rate.
(c) Loan Limit. No Participant loan shall exceed the present
value of the Participant's Account.
(d) Foreclosure. In the event of default on any installment
payment, the outstanding balance of the loan shall be a
deemed distribution. In such event, an actual distribution of
a plan loan otliet amount will not occur until a distributable
event occurs in the Plan.
(e) Reduction of Account. Notwithstanding any other
provision of this Plan, the portion of the Participant's
Account balance used as a security interest held by the Plan
by reason of a loan outstanding to the Participant shall be
taken into account for purposes of determining the amount
of the Account balance payable at the time of death or
distribution, but only if the reduction is used as repaynnent
of the loan.
(E) Amount of Loan. At the time the loan is made,
the principal amount of the loan plus the outstanding
balance (principal plus accrued interest) due on any
other outstanding loans to the Participant from the Plan
and from all other plans of the Employer that are
qualified employer plans under section 72(p)(4) of the
Code shall not exceed the least of:
1) $50,000, reduced by the excess (if any) of
(a) The highest outstanding balance of loans from the
Plan during the one (1) year period ending on the day
before the date on which the loan is made, over
(b) The outstanding balance of loans from the Plan on
the date on which such loan is made; or
(2) One-half of the value of the Participant's interest in all
of his/her Accounts under this Plan.
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Ei,gL1
457 Plan Adoption Package Retain Document
Declaration of Trust of the ICMA Retirement Trust, April 1998
(g) Application for Loan. The Participant must give the
Employer adequate written notice, as determined by the
Employer, of the amount and desired time for receiving a
loan. No more than one (1) loan may be made by the Plan
to a Participant's in any calendar year. No loan shall be
approved if an existing loan from the Plan to the Participant
is in default to any extent.
(h) Length of Loan. Any loan issued shall require the
Participant to repay the loan in substantially equal install-
ments of principal and interest, at least monthly, over a
period that does not exceed five (5) years from the date of
the loan; provided, however, that if the proceeds of the loan
are applied by the Participant to acquire any dwelling unit
that is to be used within a reasonable time (detennined at the
time of the loan is [trade) after the loan is made as the
principal residence of the Participant, the five (5) year limit
shall not apply. In this event, the period of repayment shall
not exceed a reasonable period determined by the Employer.
Principal installments and interest payments otherwise due
may be suspended for up to one (1) year during an autho-
rized leave of absence, if the promissory note so provides,
but not beyond the original tents permitted under this
subsection(h), with a revised payment schedule (within
such tents) instituted at the- end of such period of suspension.
(i) Prepayment. The Participant shall be pemtitted to repay
the loan in whole or in part at any time prior to maturity,
without penalty.
G) Promissory Note. The loan shall be evidenced by a
promissory note executed by the Participant and delivered to
the Employer, and shall bear interest at a reasonable rate
determined by the Employer.
(k) Security. The loan shall be secured by an assignment of
the participant's right, title and interest in and to his/iter
Account.
(1) Assignment or Pledge. For the purposes of paragraphs (t}
and (g), assignment or pledge of any portion of the
Participant's interest its the Plan and a loan, pledge, or
assignment with respect to any insurance contract purchased
under the Plan, will be treated as a loan.
(m) Other Terns and Conditions. The Employer shall fix
such other terns and conditions of the loan as it deems
necessary to comply with legal requirements, to maintain the
qualification of the Plan and Trust under section 457 of the
Code, or to prevent the treatment of the loan for tax
purposes as a distribution to the Participant.
The Employer, in its discretion for any reason, may fix other
terms and conditions of the loan, not inconsistent with the
provisions of this Article and section 72(p) of the Code.
8.03 Participant Loan Accounts:
(a) Upon approval of a loan to a Participant by the Em-
ployer, an amount not in excess of the loan shall be trans-
ferred from the Participant's other investment fund(s),
described in Section 6.05 of the Plan, to the Participant's
Loan Account as of the Accounting Date immediately
preceding the agreed upon date on which the loan is to be
made.
(b) The assets of a Participant's Loan Account may be
invested and reinvested only in promissory notes received by
the Plan from the Participant as consideration for a loan
permitted by Section 8.01 of the Plan or in cash. Uninvested
cash balances in a Participant's Loan Account shall not bear
interest. Neither the Employer, the Administrator, nor any
other person shall be liable for any loss, or by reason of any
breach, that results from the Participant's exercise of such
control.
(c) Repayment of principal and payment of interest shall be
made by payroll deduction or, where repayment cannot be
made by payroll deduction, by check, and shall be invested
in one (1) or more other investment funds, in accordance
with Section 6.05 of the Plan, as of the next Accounting
Date after payment thereof to the Trust. The amount so
invested shall be deducted from the Participant's Loan
Account.
(d) The Employer shall have.the authority to establish other
reasonable rules, not inconsistent with the provisions of the
Plan, governing the establishment and maintenance of
Participant Loan Accounts.
Article IX. Non -assignability
9.01 In General: Except as provided in Article Vlll and
Section 9.02, no Participant or Beneficiary shall have any
right to commute, sell, assign, pledge, transfer or otherwise
convey or encumber the right to receive any payments
hereunder, which payments and rights are expressly declared
to be non -assignable and non -transferable.
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Nine
ICMA RETIREMENT CORPORATION
9.02 Domestic Relations Orders:
(a) Allowance of Transfers: To the extent required under
final judgement, decree, or order (including approval of a
property settlement agreement) made pursuant to a state
domestic relations law, any portion of a Participant's Ac-
count may be paid or set aside for payment to a spouse,
former spouse, or child of the Participant. Where necessary
to carry out the terns of such an order, a separate Account
shall be established with respect to the spouse, former
spouse, or child who shall be entitled to make investment
selections with respect thereto in the same manner as the
Participant; any amount so set aside for a spouse, former
spouse, or child shall be paid out in a lump sum at the
earliest date that benefits may be paid to the Participant,
unless the order directs a different time or form of payment.
Nothing in this Section shall be construed to authorize any
amount to be distributed under the Plan at a time or in a
form that is not permitted under Section 457 of the Code.
Any payment made to a person other than the Participant
pursuant to this Section shall be reduced by required income
tax withholding; the fact that payment is made to a person
other than the Participant may not prevent such payment
from being includible in the gross income of the Participant
for withholding and income tax reporting purposes.
(b) Release from Liability to Participant: The Employer's
liability to pay benefits to a Participant shall be reduced to
the extent that amounts have been paid or set aside for
payment to a spouse, former spouse, or child pursuant to
paragraph (a) of the Section. No such transfer shall be
effectuated unless the Employer or Administrator has been
provided with satisfactory evidence that the Employer and
the Administrator are released from any further claim by the
Participant with respect to such amounts. The Participant
shall be deemed to have released the Employer and the
Administrator from any claim with respect to such amounts,
in any case in which (i) the Employer or Administrator has
been served with legal process or otherwise joined in a
proceeding relating to such transfer, (ii) the Participant has
been notified of the pendency of such proceeding in the
manner prescribed by the law of the jurisdiction in which
the proceeding is pending for service of process in such
action or by mail from the Employer or Administrator to the
Participant's last known mailing address, and (iii) the Partici-
pant fails to obtain an order of the court in the proceeding
relieving the Employer or Administrator from the obligation
to comply with the judgment, decree, or order.
(c) Participation in Legal Proceedings: The Employer and
Administrator shall not be obligated to defend against or set
aside any judgement, decree, or order described in paragraph
(a) or any legal order relating to the garnishment of a
Participant's benefits, unless the full expense of such legal
action is home by the Participant. In the event that the
Participant's action (or inaction) nonetheless causes the
Employer or Administrator to incur such expense, the
amount of the expense may be charged against the
Participant's Account and thereby reduce the Employer's
obligation to pay benefits to the Participant. In the course of
any proceeding relating to divorce, separation, or child
support, the Employer and Administrator shall be authorized
to disclose information relating to the Participant's Account
to the Participant's spouse, former spouse, or child (including
the legal representatives of the spouse, former spouse, or
child), or to a court.
Article X. Relationship to other Plans
and Employment Agreements
This Plan serves in addition to any other retirement, pen-
sion, or benefit plan or system presently in existence or
hereinafter established for the benefit of the Employees
employees, and participation hereunder shall not affect
benefits receivable under any such plan or system. Nothing
contained in this Plan shall be deemed to constitute an
employment contract or agreement between any Participant
and the Employer or to give any Participant the right to be
retained in the employ of the Employer. Nor shall anything
herein be construed to modify the teris of any employment
contract or agreement between a Participant and the Em-
ployer.
Article XI. Amendment or
Termination of Plan
The Employer may at any time amend this Plan provided
that it transmits such amendment in writing to the Adminis-
trator at least 30 days prior to the effective date of the
amendment. The consent of the Administrator shall not be
required in order for such amendment to become effective,
but the Administrator shall be under no obligation to
continue acting as Administrator hereunder if it disapproves
of such amendment. The Employer may at any time termi-
nate this Plan.
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Tr•
457 Plan Adoption Package Retain Drocum en
Declaration of Trust of the ICMA Retirement Trust, April 1998
The Administrator may at any time propose an amendment
to the Plan by an instrument in writing transmitted to the
Employer at least 30 days before the effective date of the
amendment. Such amendment shall become effective unless,
within such 30 -day period, the Employer notifies the
Administrator in writing that it disapproves such amend-
ment, in which case such amendment shall not become
effective. In the event of such disapproval, the Administrator
shall be under no obligation to continue acting as Adminis-
trator hereunder.
Except as may be required to maintain the status of the Plan
as an eligible deferred compensation plan under section 457
of the Code or to comply with other applicable laws, no
amendment or termination of the Plan shall divest any
Participant of any rights with respect to compensation
deferred before the date of the amendment or termination.
Article XII. Applicable Law
This Plan and Trust shall be construed under the laws of the
state where the Employer is located and is established with
the intent that it meet the requirements of an "eligible
deferred compensation plan" under Section 457 of the
Code, as amended. The provisions of this Plan and Trust
shall be interpreted wherever possible in confortuity with the
requirements of that section.
Article XIII. Gender and Number
The masculine pronoun, whenever used herein, shall include
the feminine pronoun, and the singular shall include the
plural, except where the context requires otherwise.
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Evan
457 Plan Adoption Package Retain Document
Declaration of Trust of the ICh1A Relircrneut Trust, dlay 1997
APPENDIX B
DECLARATION OF TRUST
OF THE ICMA RETIREMENT TRUST
Article 1. Name and Definitions
Section 1.1 Name: The name of the trust created hereby is the
ICMA Retirement Trust.
Section 1.2 Definitions: Wherever they are used herein, the
following terns shall have the following respective meanings:
(a) Bylaws. The bylaws referred to in Section 4.1 hereof, as
amended from time to time.
(b) Deferred Compensation Plan. A deferred compensation
plan established and maintained by a Public Employer for the
purpose of providing retirement income and other deferred
benefits to its employees in accordance with the provision of
section 457 of the Internal Revenue Code.
(c) Employees. Those employees who participate in Qualified
Plats and/or Deferred Conmpensagon Plans.
(d) -Employer Trust. A must created pursuant to an agreement
between RC and a Public Employer, or an agreement between
RC and a Public Employer for administrative services that is trot
a trust, in either case for the purpose ofinvesting and administering
the funds set aside by such Employer in connection with its
Deferred Compensation agreements with its employees or in
connection with its Qualified Plan.
(e) Investment Contract. A non-negotiable contract entered
into by the Retirement Trust with a financial institution that
provides for a fixed rate of return on investment.
(f) ICMA. The International City/County Management
Association.
(g) ICMA Trustees. Those Trustees elected by the Public
Employers in accordance with the provisions of Section 3.1(a)
hereof, who are also unembers orfilmier members ofthe Executive
Board of ICMA.
(h) RC Trustees. Those Trustees electedbythePublic Employers
who, in accordance with the provisions of Section 3.1(a) hereof,
are also members or former members of the Board of Directors of
RC.
(i) Internal Revenue Code. The Internal Revenue Code of
1986, as amended.
6) Investment Adviser. The Investment Adviser that enters
into a contract with the Retirement Trust to provide advice with
respect to investment of the Trust Property.
(k) Portfolios. The separate commingled pools of investment
established by the Investment Adviser to the Retirement Trust,
under the supervision ofthe Trustees, for the purpose ofproviding
investments for the Trust Property.
(1) Public Employee Trustees. Those Trustees elected by the
Public Employers who, in accordance with the provision of
Section 3.1 (a) hereof, are hill -time employees ofPublic Employers.
(m) Public Employer Trustees. Public Employers who serve as
trustees of the Qualified Plats or Deferred Compensation Plans.
(n) Public Employer. A unit of state or local government, or
any agency or instrumentality thereof, that has adopted a Deferred
Compensation Plan or a Qualified Plan and Inas executed this
Declaration of Trust.
(o) Qualified Plan. A plan that is sponsored by a Public
Employer for the purpose of providing retirement income to its
employees and that satisfies the qualification requirements of
Section 401 of the Internal Revenue Code.
(p) Public Employer Trust. A trust that is established by a
Public Employer in connection with its Qualified Plan and that
satisfies the requirements of Section 501 of the internal Revenue
Code, or a trust established by a Public Employer in connection
with its Deferred Compensation Plan and that satisfies time
requirements of Section 457(6) of the Internal Revenue Code.
(q) RC. The International City Management Association
Retirement Corporation.
(r) Retirement Trust. The Trust created by this Declaration of
Trust.
(s) Trust Property. Thearnounts held in the RetimmentTrust
as provided in Section 2.3. The Trust Property shall include any
income resulting front the investment to the amounts so held.
(t) Trustees. The Public Employee Trustees, ICMA Tntstees
and RC Trustees elected by the Public Employers to serve as
members of the Board of Trustees of the Retirement Trust_
Article 11. Creation and Purpose of the Trust;
Ownership of Trust Property
Section 2.1 Creation:
(a) The Retirement Trust was created by the execution of this
Declaration of Trust by the initial Trustees and Public Employers
and is established with respect to each participating Public Employer
by adoption of this Declaration of Trust.
(b) The Retirement Trust is hereby expressly made a part of the
appropriate Qualified Plan or Deferred Compensation Plan of
each Public Employer that executes or has executed this )Declaration
of Trust.
Section 2.2 Purpose and Participation:
(a) The purpose of the Retirement Tmst is to provide for the
commingled investment of funds held by the Public Employers in
connection with their Deferrer{ Compensation and Qualified
Plans. Tile Trust Property shall be invested in the Portfolios, in
Investment Contracts, and in other investments recommendedby
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Declaration of Trust of the (CMA Retirement Trust, May 1997
the Investment Adviser under the supervision of the Board of procedures set forth in the By -Laws.,
Tmstees. No part of the Trust Property will be invested in
securities issued by Public Employers.
(b) Participation in the Retirement Trust is limited to (i) pension
and profit-sharing trusts which are maintained by Public Employers
and that are exempt under section 501(a) of the Internal Revenue
Code because the Qualified Plans related thereto qualify under
section 401(a) of the Internal Revenue Code and (ii) deferred
compensation plammaintainedby Public Employers under Section
457 of the Internal Revenue Code (and trusts maintained by such
Public Employers in connection with such 457 plans).
Section .2.3 Ownership of Trust Property:
(a) The Trustees shall have legal title to the Trust Property. The
Trust Property shall be held as follows:
(i) for the Public Employer Trustees for the exclusive benefit ofthe
Employees; or
(ii) in the case of a Deferred Compensation Plan maintained by a
Public Employer that has not established a Public Employer Tmst
for the plan, for the Public Employer as beneficial owner of the
plan's assets.
(b) The portion ofthe corpus and income of the Retirement Trust
that equitably belongs to any Public Employer Trust may not be
used for or diverted to any purpose other than for the exclusive
benefit of the Employees (or their beneficiaries) who are entitled
to benefits under such Public Employer Trust.
(c) No employees Public Employer Trust may assign any part of
its equity or interest in the Retirement Trust, and any purported
assignment of such equity or interest shall be void.
Article 111. Trustees
Section 3.1 Number and Qualification of Trustees:
(a) The Board ofTmstees shall consist ofnine Trustees. Five ofthe
Tmstees shall be full-time employees of a Public Employer (the
Public Employee Tmstees) who are authorized by such Public
Employer to serve as Trustee. The remaining four Tmstees shall
consist of two persons who, at time time of election to the Board
of Trustees, are nmenmbers or former members of the Executive
Board of ICMA, and two persons who, at the time of election, are
Members or former members of the Board of Directors of RC.
One of the ICMA Tmstees and one of the RC Trustees shall, at
the time of election, be full-time employees of Public Employers.
(b) No person may serve as a Tmstee for more than two terns in
any ten-year period.
Section 3.2 Election and Term:
(a) Except for theTrusteesappointed to fill vacancies pursuant to
Section 3.5 hereof, time Tmstees shall be elected by a vote of a
majority of the voting Public Employers in accordance with the
(b) At the fiat election of Trustees, three Tmstees shall be elected
for a term of three years, three Tmstees shall be elected for a term
of two years and three Tmstees shall be elected for a term of one
year. At each subsequent election, three Tmstees shall be elected,
each to serve for a term of three years and until his or her successor
is elected and qualified.
Section 3.3 Nominations: The Tmstees who are full-time
employees of Public Employers shall serve as the Nominating
Committee for the Public Employee Tmstees. The Nominating
Committee shall choose candidates for Public Employee Trustee
in accordance with the procedures set forth in the By -Laws.
Section 3.4 Resignation and Removal:
(a) Any Trustee may resign as Trustee (without need for prior or
subsequent accounting) by an instrument in writing signed by the
Tmstee and delivered to the other Trustees and such resignation
shall be effective upon such delivery, or at a later date according to
the termsofthe instrument. Any of the Tmstees may be removed
for cause, by a vote of a majority of the Public Employers.
(b) Each Public Employee Trustee shall resign his or her position
as Trustee within 60 days of the date on which he or she ceases to
be a full-time employee of a Public Employer.
Section 3.5 Vacancies: The term of office of a Trustee shall
terminate and a vacancy shall occur in the event ofhis or her death,
resignation, removal, adjudicated incompetence or other incapac-
ity to perform the duties of the office of a Trustee. In the case of
a vacancy, time remaining Trustees shall appoint such person as they
in their discretion shall see fit (subject to the limitations set forth in
this Section), to serve for the unexpired portion of the term of the
Trustee who has resigned or otherwise ceased to be a Trustee. The
appointment shall be made by a written instrument signed by a
majority of time Trustees. The person appointed must be the same
type ofTnistee (i.e., Public Employee Trustee, ICMA Trustee or
RC Trustee) as the person who has ceased to be a Trustee. An
appointment ofa Trustee nmay be nmade in anticipation ofa vacancy
to occur at a later date by reason of retirement or resignation,
provided that such appoinnnent shall not become effective prior to
such retirement or resignation. Whenever a vacancy shall occur,
until such vacancy is filled as provided in this Section 3.5, the
Trustees in office, regardless of their number, shall have all the
powers granted to the Trustees and shall discharge all the duties
imposed upon the Trustees by this Declaration. A written instru-
nment certifying the existence of a vacancy signed by a majority of
the Trustees shall be conclusive evidence of the existence of such
vacancy.
Section 3.6 Trustees Serve in Representative Capacity: By
executing this Declaration, each Public Employer agrees that the
Public Employee Trustees elected by the Public Employers are
authorized to act as agents aid representatives of the Public
Employers collectively.
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Article IV. Powers of Trustees
Section 4.1 General Powers: The Trustees shall have the power
to conduct the business of the Trust and to carry on its operations.
Such power shall include, but shall not be limited to, the power to:
(a) receive the Trust Property from the Public Employers, Public
Employer Trustees or the trustee or administrator under any
Employer Trust;
(b) enter into a contract with an Investment Adviser providing,
anmong other things, for the establishment and operation of the
Portfolios, selection of the Investment Contracts in which the
Trust Property may be invested, selection of the other investments
for the Trust Property and the payment of reasonable fees to time
Investment Adviser and to any sub -investment adviser retained by
the Investment Adviser;
(c) review annually the performance of the Investment Adviser
and approve annually the contract with such Investment Adviser,
(d) invest and reinvest the Trust Property in the Portfolios, the
Investment Contracts and in any other investment recommended
by the Investment Adviser, but not including securities issued by
Public Employers, provided that if Public Employer has directed
that its monies be invested in one or more specified Portfolios or
in an Investment Contta� t, the Tnutees of the Retirement Trust
shall invest such monies in accordance with such directions;
(e) keep such portion of the Trust Property in cash or cash
balances as the Trustees, from time to time, may deem to be in the
best interest of the Retirement Trust created hereby without
liability for interest thereon;
(f) accept and retain for such time as they may deem advisable any
securities or other property received or acquired by then; as
Trustees hereunder, whether or not such securities or other
property would nonnally be purchased as investment hereunder;
(g) cause any securities or other property held as part of the Trust
Property to be registered in the name of the Retirement Trust or
in the name of a nominee, and to hold any investments in bearer
-form, but the books and records of the Trustees shall at all times
show that all such investments are a part of time Trust Property;
(h) make, execute, -acknowledge, and deliverany and all documents
of transfer and conveyance and any and all other instruments that
may be necessary or appropriate to carry out the powers herein
. granted;
(i.) vote upon any stock, bonds, or other securities; give general
or special proxies or powers of attorney with or without power of
substitution; exercise any conversion privileges, subscription rights,
or other options, and make any payments incidental thereto:
oppose, or consent to, or otherwise participate in, corporate
reorganizations or to other changes affecting corporate securities,
and delegate discretionary powers and pay any assessments or
charges in connection therewith; and generally exercise any of the
powers of an owner with respect to stocks, bonds, securities or
other property held as part of the Trust Property;
6) enter into contracts or arrangements for goods or services
required in connection with the operation of the Retirement
Trust, including, but not limited to, contracts with custodians and
contracts for the provision of administrative services;
(k) borrow or raise money for the purposes of the Retirement
Trust in such amount, and upon such terms and conditions, as the
Trustees shall deem advisable, provided that the aggregate amount
of such borrowings shall not exceed 30"0 of the value of the Trust
Property. No person lending money to the Trustees shall be
bound to see the application of the money lent or to inquire into
its validity, expediency or propriety or any such borrowing;
(I) incur reasonable expenses as required for the operation ofthe
Retirement Trust and deduct such expenses from of the Trust
Property;
(m) pay expenses properly allocable to the Trust Property
incurred in connection with the Deferred Compensation Plans,
Qualified Plans, or the EmployerTnuts and deduct such expenses
from that portion ofthe Trust Property to whichsuch expenses are
properly allocable;
(n) pay out of the Trust Property all real and personal property
taxes, income taxes and other taxes of any and all kinds which, in
the opinion of the Trustees, are properly levied, or assessed under
existing or future laws upon, or in respect of, the Trust Property
and allocate any such taxes to the appropriate accounts;
(o) adopt, amend and repeal the Bylaws, provided that such
Bylaws are at all times consistent with the terms ofthis Declaration
of Trust;
(p) ennploy persons to make available interests in the Retirement
Trust to employers eligible to maintain a Deferred Compensation
Plan under Section 457 or a Qualified Plan under Section 401 0£
the Internal Revenue Code;
(q) issue the Annual Report of the Retirement Trust, and the
disclosure documents and other literature used by the Retirement
Trust;
(r) inadditiontoconductingtheinvestntentprogramauthorized
in Section 4.1(d), make loans, including the purchase of debt
obligations, provided that all such loans shall bear interest at the
current market rate;
(s) contract for, and delegate any powers granted hereunder to,
such officers, agents, employees, auditors and attorneys as time
Trustees may select, provided that the Trustees may not delegate
the powers set forth in paragraphs (b), (c) and (o) of this Section
4.1 and may not delegate any powers if such delegation would
violate their fiduciary duties;
(t) provide for the indemnification of the Officers and Trustees
of the Retirement Trust and purchase fiduciary insurance;
(u) maintain books and records, including separate accounts for
each Public Employer, Public Employer Trustee or Employer
Trust and such additional separate accounts as are required under,
and consistent with, the Deferred Compensation or Qualified
Plan of each Public Employer; and
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Declaration of Trust of the ICMA Retirement Trust, May 1997
(v) do all such acts, take all such proceedings, and exercise all such
rights and privileges, although not specifically mentioned herein,
as the Trustees may deem necessary or appropriate to administer
the Trust Property and to carry out the purposes ofthe Retirement
Trust.
Section 4.2 Distribution of Trust Property: Distributions of
the Trust property shall be made to, or on behalf of, the Public
Employer or Public Employer Trustee, in accordance with the
temp of the Deferred Compensation Plans, Qualified Plans or
Employer Trusts. The Trustees of the Retirement Trust shall be
fully protected in making payments in accordance with the
directions of the Public Employers, Public Employer Trustees or
trustees or administrators of any Employer Trust without ascer-
taining whether such payments are in compliance with the
provisions of the applicable Deferred Compensation or Qualified
Plan or Employer Trust.
Section 4.3 Execution of Instruments: The Trustees may
unanimously designate any one or more of the Trustees to execute
any instrument or document on behalf of all, including but not
limited to the signing or endorsement ofany check and the signing
of any applications, insurance and other contracts, and the action
of such designated Trustee or Trustees shall have the sante force
and effect as if taken by all the Trustees.
Article V. Duty of Care and Liability of Trustees
Section 5.1 Duty of Care: In exercising the powers hereinbe-
fore granted to the Trustees, the Trustees shall perform all acts
within their authority for the exclusive purpose of providing
benefits for the Public Employers in connection with non -trusteed
Deferred Compensation Plans and for the Public Employer Trust-
ees, and shall perform such acts with the care, skill, prudence and
diligence in the circumstances then prevailing that a prudent
person acting in a like capacity and familiar with such matters
would use in the conduct of an enterprise of a like character and
with like ainms.
Section 5.2 Liability: The Trustees shall not be liable for any
mistake ofjudgment or other action taken in good faith, and for
any action taken or omitted in reliance in good faith upon the
books of account or other records of the Retirement Trust, upon
the opinion of counsel, or upon reports made to the Retirement
Trust by any of its officers, employees or agents or by the
Investment Adviser or any sub -investment adviser, accountant,
appraiser or other expert or consultant selected with reasonable
care by the Trustees, officers or employees of the Retirement
Trust. The Trustees shall also not be liable for any loss sustained by
the Trust Property by reason ofany investment made in good faith
and in accordance with the standard ofcare sea forth in Section 5.1.
Section 5.3 Bond: No Trustee shall be obligated to give any
bond or other security for the performance oFany of his or her
duties hereunder.
Article VI. Annual Report to Shareholders
The Trustees shall annually submit to the Public Employ-
ers and Public Employer Trustees a written report ofthe transac-
tions of the Retirement Trust, including financial statements
which shall be certified by independent public accountants chosen
by the Trustees.
Article VII. Duration or Amendment
of Retirement Trust
Section 7.1 Withdrawal: A Public Employer or Public Em-
ployer Trustee may, at any time, withdraw from this Retirement
Trust by delivering to the Board ofTmstees a written statement of
withdrawal. In such statement, the Public Employer or Public
Employer Trustee shall acknowledge that the Trust Property
allocable to the Public Employer is derived from compensation
deferred by employees of such Public Employer pursuant to its
Deferred Compensation Plan or from contributions to the ac-
counts of Employees pursuant to a Qualified Plan, and shall
designate the financial institution to which such property shall be
transferred by the Tmstees of the Retirement Trust or by the
trustee or administrator under an Employer Trust.
Section 7.2 Duration: The Retirement Trust shall continue
until terminated by the vote ofa majority ofthe Public Employers,
each casting one vote. Upon termination, all ofthe Trust Property
shall be paid out to the Public Employers, Public Employer
Trustees or the trustees or administrators of the Employer Trusts,
as appropriate.
Section 7.3 Amendment: The Retirement Trust may be
amended by the vote of a majority of the Public Employers, each
casting one vote.
Section 7.4 Procedure: A resolution to terminate or amend the
Retirement Trust or to remove a Trustee shall be submitted to a
vote of the Public Employers if: (i) a majority of the Trustees so
direct, or; (ii) a petition requesting a vote signed by not less than
25 percent of the Public Employers, is submitted to the Trustees.
Article Vlll. Miscellaneous
Section 8.1 Governing Law: Except as otherwise required by
state or local law, this Declaration of Trust and the Retirement
Trust hereby created shall be construed and regulated by the laves
of the District of Columbia.
Section 8.2 Counterparts: This Declaration maybe executedby
the Public Employers and Trustees in two or more counterparts,
each ofwhich shall be deemed an original but all ofwhich together
shall constitute one and the same instrument.
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