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HomeMy WebLinkAbout1998-15 Amending the Deferred Compensation Plan and Establishing a TrustRESOLUTION NO.15 SERIES OF 1998 A RESOLUTION AMENDING THE DEFERRED COMPENSATION PLAN AND ESTABLISHING A TRUST. WHEREAS, the Town of Vail established a deferred compensation plan in April of 1981; and WHEREAS, on July 18, 1995, the Town of Vail terminated the ICMA Deferred Compensation Plan that had been established on December 18, 1984, and decided to cease using Great West for contributions for the Town of Vail Deferred Compensation Plan and to use new investment providers for the Town of Vail Deferred Compensation Plan; and WHEREAS, the Town of Vail believes it is in the best interest of Town of Vail Employees to amend and restate the Town of Vail Deferred Compensation Plan and to establish a trust to hold the assets of the Plan, as required by_the Internal Revenue Code. NOW, THEREFORE, BE IT RESOLVED by the Town Council of the Town of Vail, Colorado, that: 1. The Town of Vail does hereby adopt the Town of Vail Deferred Compensation Plan and Trust, attached hereto as Exhibits "A" and "`B." 3. This resolution shall take effect immediately upon its passage. INTRODUCED, ,„ ,~~~~ APPROVED AND ADOPT his 1 st d £ December, 1998. E ~ ~' - Robert E. Ford, Mayor J 1 Ilq! f ! 1 Si 13111 l1U ~ ~t~~~S ATTEST: ~''~ CpLORA~~.~~```~~ v"~' l ~ oI lei Donaldson, Town Clerk TOWN OF VAIL DEFERRED COMPENSATION TRUST AGREEMENT as o~December 31,1998} BRB152d3413dd E43.d2 i TOWN OF VAiL DEFERRED COMPENSATION TRUST AGREEMENT WHEREAS, the Town of Vail established the Town of Vail Deferred Compensation Plan the "Plan"} effective December 31, 1998; and WHEREAS, the Plan requires that the Plan assets be held in trust, pursuant to the Internal Revenue Code of 198b, as amended; NOW, THEREFORE, the Employer and the Trustee agree as follows: Section 1. Definitions. a) Beneficiary: "Beneficiary" means the person(s) or estate entitled to receive benefits under this Plan after the death of a Participant. b) Code: "Code" means the Internal Revenue Code of 198, as amended, and including ail regulations promulgated pursuant thereto. c) Deferral: "Deferral" means the annual amount of Compensation that a Participant elects to defer receipt of pursuant to a properly executed Voluntary Salary Deferral Agreement. d) Eligible Employee: "Eligible Employee" means any person, excluding independent contractors and seasonal employees, who performs services for the Employer as a regular full-time Employee and who receives coi~ipensation from the Employer for services performed. e) Employer: "Employer" means the Town of Vail, Colorado. f) Participant: "Participant" means an Ella ble Employee or former Eligible Employee who is or has been enrolled in the Plan and who retains the right to benefits under the Plan. g) Plan: "Plan" means the Tawn of Vail Deferred Compensation Plan dated the 31 ~` day of December, 1998, as amended from time to tune. h) Retirement Board: "Retirement Board" means the board appointed pursuant to Section 2.14 of the Town of Vail Employees' Pension Plan, adopted January 1, 1994, as amended or restated from time to tune. BRB1.520 5.13 001.1S.0? i i) Trust or Trust Fund: "Trust" or "Trust Fund" means the trust established pursuant to this Town of Vail Deferred Compensation Trust Agreement. j} Trustee: "Trustee" means the Retirement Board established, appointed and maintained by the Employer. Section 2. General Duties of the Employer: The Employer shall make regular periodic payments to the Trustee equal to the amount of its participating Employees' total Deferrals which are deferred in accordance with the Town of Vail Deferred Compensation Plan. Section 3. General Duties of the Trustee: The Trustee shall hold all funds received by it hereunder, which, together with the income therefrom, shaIl constitute the Trust Funds. It shall administer the Trust Funds, collect the income thereof, and make payments therefrom, all as hereinafter provided. The Trustee shall also hold aIl Trust Funds which are transferred to it as successor Trustee by the Employer from existing deferred compensation arrangements with its Employees which meet the same Internal Revenue Code requirements which govern the Plan. Such Trust Funds shall be subject to all of the terms and provisions of this Trust. Section 4. Investment Powers and Duties of the Trustee: The Trustee shall have the power in its discretion to invest and reinvest the principal and income of the Trust Fund and keep the Trust Fund invested, without distinction between principal and income, in such securities or in other property, real or personal, wherever situated, as the Trustee shall deem advisable, including, but not limited to, stocks, common or preferred, bonds, retirement annuity artd insurance policies, mortgages, and other evidences of indebtedness or ownership, and in common trust funds of approved financial or investment institutions, with such institutions acting as Trustee of such common trust funds, or separate and different types of funds (accounts) including equity, fixed- income, and those which fulfill requirements of state and local governmental laws, established with such approved financial or investment institutions. For these purposes, this Trust Fund may be commingled with others established by the Trustee under this form of agreement with other Employers. In making such investments, the Trustee shall not be subject at any tune to any legal limitation governing the investment of such funds. Investment powers and investment discretion vested in the Trustee by this Section may be~ delegated by the Trustee to any bank, insurance ar trust company, ~or any investment advisor, manager or agent selected by it. Section ~. Investments: A Participant or Beneficiary of the Plan may request that Deferrals under the Plan be allocated among available investment options established by the Trustee. The initial allocation request may be made at the time of enrollment. Investment allocation requests shall remain effective with regard to all subsequent Deferrals, until changed iII accordance with the provisions of this section. A Participant or Beneficiary may change his or her allocation request at the end of each calendar month pursuant to procedures established by the Trustee, by notifying the Trustee in writing. Such changes shall become effective as soon as administratively feasible. While the Trustee intends to invest Deferrals according to the Participant requests, it reserves the right to invest Deferrals without regard to such requests. Neither the Employer, the Trustee, nor any other person shall be liable for any losses incurred by B~~~os~s~3oaias.oa ~ virtue of following such directions or with any reasonable administrative delay in implementing such directions. Section 6. Administrative Po~~~ers of the Trustee: The Trustee shall have the power, in its discretion: a) To purchase, or subscnbe for, any securities or other property and to retain the same in trust. b) To sell, exchange, convey, transfer or otherwise dispose of any securities or other property held by it, by private contract, or at public auction. No person dealing with the Trustee shall be bound to see the application of the purchase money ar to inquire into the validity, expediency, or propriety of any such sale or other disposition. c) To vote upon stacks, bonds, or other securities, to bve general or special proxies or powers of attorney with or without power of substitution; to exercise any conversion privileges, subscription rights, or other options, and to make any payments incidental thereto; to oppose, or to consent to, or otherwise participate in, corporate reorganizations or other chanties affecting corporate securities, and to delegate discretionary powers, and to pay any assessments or charges in connection therewith; and to generally exercise any of the powers of an owner with respect to stocks, bonds, securities or other property held as part of the Trust Funds. d) To cause any securities or other property held as part of the Trust Funds to be registered in its own name. and to hold any investments in bearer forth, but the books and records of the Trustee shall at all times show that all such investments are a part of the Trust Fund. e) To borrow or raise money for. the purpose of the Trust in such amount, and upon such terms and conditions, as the Trustee shall deem advisable; and, for any sum so borrowed, to issue its promissory note as Trustee, and to secure the repayment thereof by pledging all, or any part, of the Trust Funds. No person lending money to the Trustee shall be bound to 'see the application of the money lent or to inquire into its validity, expediency or propriety of any such borrowing. f) To keep such portion of the Trust Funds i.n cash or cash balances as the Trustee, from time to time, may deem to be in the best interest of the Trust created hereby, without liability for interest thereon. To accept and retain for such time as it may deem advisable any securities or other property received or acquired by it as Trustee hereunder, whether or not such securities or other property would normally be purchased as investments hereunder.. h) To make, execute, acknowledge, and deliver any and all documents of transfer and conveyance and any and all other instruments that may he~ necessary or appropriate to carry out the powers herein granted. s2oss;ao ~as.a~ ~ i) To settle, corrapromise, or submit to arbitration any claims, debts, or damages due or owing to or from the Trust Funds;. to commence or defend suits or legal ar administrative proceedings; and to represent the Trust Funds in all suits and legal and administrative proceedings. j} To do all such acts, take all such proceedings, and exercise all such rights and privileges, although not specifically mentioned herein, as the Trustee may deem necessary to administer the Trust Funds amd to carry nut the purposes of this Section. Section 7. Distributions from the Trust Funds: The Trustee shall make benefit payments from the Trust Fund to Participants in accordance with the provisions in the Plan for distribution of benefits. Section 8. Valuation of Trust Funds: At least once a year, as of valuation dates designated by the Trustee, the Trustee shall determine the value of the Trust Funds. Assets of the Trust Funds shall be valued at their market values at the close of business on the valuation date, or, in the absence of readily ascertainable market values as the Trustee shall determine, in accordance with methods consistently followed and uniformly applied. Section 9. Evidence of Action by Employer: The Trustee may rely upon any certificate, notice or direction purporting to have been signed on behalf of the Fm'Tloyer which the Trustee believes to have been signed by a duly designated official of the Employer. No communication shall be binding upon any of the Trust Funds or Trustee until they are received by the Trustee. Section lO.Advice of Counsel: The Trustee may consult with any legal counsel with respect to the construction of the Plan or Trust, its dories hereunder, or any act, which it proposes to take or omit, and shall not be liable for any action taken or omitted in good faith pursuant to such advice. Section 1 I.Vliscellaneous: The Trustee shall use ordinary care and reasonable diligence, but shall not 'be -liable for any mistake of judgment or other action taken iri good faith. The Trustee shall not be liable for any lass sustained by the Trust Funds by reason of any investment made in~ good faith and in accordance with the provisions of this Section. The- Trustee's duties and obligations shall be limited to those expressly imposed upon it by this section, notwithstanding any reference of the Plan. Section 1?.Ta:~es: The Trustee shall deduct from and charge against the Trust Funds any taxes on the Trust Funds or the income thereof or which the Trustee is required to pay with respect to the interest of any person therein. Section 13.Expenses: The Trustee shall deduct from any charge against the Trust Fund all reasonable expenses incurred by the Trustee in the administration of the Trust Fund, including counsel, agency and other necessary fees. B~~saasavaoias.oa 4 i • Section 14.Settlement of Accounts: The Trustee shall keep accurate and detailed accounts of all investments, receipts, disbursements, and other transacts©ns hereunder. a} Accounts shall be valued at least quarterly each Plan Year and each Participant shall receive wz-itten notice of his or her account balance following such valuation. Account balances shall reflect the Deferral amount, any earnings attributable to such amount, and shall be reduced by administrative, investment and other fees attributable to such amounts. b) Within 90 days after the close of each fiscal year, the Trustee shall render to ' the Employer an accounting of its acts and transactions as Trustee hereunder with respect•to -each Employer participating in the Plan. If any part of the Tzust Fund shall be invested through the ~ - medium of any common, collective or commingled trust funds, the last annual report of such trust funds shall be submitted with and incozporated in the account. c) If within 90 days after the mailing of the account, or any amended account, the Employer has not filed with the Trustee notice of any objection to any act or transaction of the Trustee, the account or amended account shall become an account stated. If any objection has been filed, and if the Employer is satisfied that it should be withdrawn or if the account is adjusted to the Employer's satisfaction, the Employer shall in writing filed with the Trustee signify approval of the account and it shall become an account stated. d) When an account becorries an account stated, such account shalt be finally settled, and the Trustee shall be completely discharged and released, as if such account had been settled and allowed by a judgment or decree of a court of competent jurisdiction in an action or proceedings in which the Trustee and the Employer were parties. The Trustee shall have the right to apply at any time to a court of competent jurisdiction for the judicial settlement of its account. Section l~.Resignation of Trustee: The Trustee may resign at nay time by filing with the Employer its wz-itten. resignation. Such resignation shall take effect 60 days from the date of such filing and upon appointment of a successor pursuant to Section 17, whicheti•er shall first occur. Section 16.Removal of Trustee: The Employer may remove the Trustee at any time by delivering to the Trustee a written notice of its removal and an appointment of a successor pursuant to Section 17. Such removal shall not tape effect prior to 60 days from such delivery unless the Trustee agrees to an earlier effective date. Section 17.Appointment of Successor Trustee: The appointment of a successor to the Trustee shall take effect upon the delivery to the Trustee (a) an instrument in writing executed by the Employer appointing such successor, and exonerating such successor from liability for the acts and omissions of its predecessor, and (b) an acceptance in writing, executed by such successor. All of the provisions set forth herein with respect to the Trustee shall relate to each successor with the same force and effect as if such successor had been originally named as Trustee hereunder. If a successor is not appointed within 60 days after the Trustee gives notice of its resignation BR$~5'_'OS•3'300143.0? 5 pursuant to Section 1~, the Trustee may apply to any court of competent jurisdiction far appointment of a successor. ~ • Section 18.Transfer of Funds to Successor: Upon the resignation or removal of the Trustee and appointment of a successor, and after the final account of the Trustee has been properly settled, the Trustee shall transfer and deliver any of the Trust Funds involved to such successor. Section 19.Plxn-to-Plan Transfers: Notwithstanding any other PIai~ provision, distribution of amounts deferred by the farmer Participant of the Plan shall not cgmmen~e upon Separation from Service, but instead shall be automatically transferred to another' Eligible Deferred Compensation Plan, of which the former Participant has become a Participant, if: a) the-Plan receiving such amounts provides for their acceptance, and b} a Participant incurs a Separation from Service with the Employer iii order to accept employment with another "eligible" entity. This Trust will accept the transfer of amount previously deferred by a Participant under another Eligible Deferred Compensation Plan. The Trustee may refuse to accept a transfer in the form of assets other than cash. Section 20.Duration and Revocation: This Trust shall continue for such time as may be necessary to accomplish the purpose far which it was created. The Trust may not be terminated until the date on which no Plan Participant is entitled to any benefits under the Plan. Upon termination of the Trust, any remaining assets shall be returned to the Employer. The Trust may be revoked only if the Internal Revenue Service determines that the Plan is not an eligible deferred compensation plan under Internal Revenue Code Section 457. In all other instances, the Trust is irrevocable. Termination of this Trust shall not, however, relieve the Employer of the Employer's continuing obligation to pay deferred compensation upon the applicable distribution date to any and,~or each Employee with whom the Employer has entered into a Voluntary Salary Deferral Agreement.., Section 21.Amendment: The Employer shall have the right to amend the Trust in whole and in part but only with the Trustee's written consent. Any such amendment shall become effective upon (a} delivery to the Trustee of a written instrument of amendment, and (b} the endorsement by the Trustee on such instrument of its consent thereto. ` Section 22.Ownership of Assets: All amounts deferred under the Plan and contributed to the Trust, al! property and rights purchased with such amounts, and all income attributable to such amounts, property ar rights shall be held for the exclusive purposes of providing benefits to the Participants and Beneficiaries and defraying reasonable expenses of administering the Plan and this Trust. Bx.avzos~•Uao i~s.oz 6 i ~ i~n~ 5S All amounts contributed to the Trust shall be held as a separate and distinct trust for each Employer's employees and former employees who are Participants in the Plan and their beneficiaries. However, Trust funds of several employers may be commingled for investment purposes, provided that the Trustee maintains an accounting reflecting the Trust funds held on behalf of each Employer's employees. Section 23.Anti~Alienation: Benefits to Participants under the Plan and this Trust Agreement may not be anticipated, assigned, alienated or subject to. attachment, garnishment, levy, execution or other legal or equita$le process. If a court of competent jurisdiction holds any provision of this Trust to be invalid or unenforceable, the remaining provisions of the~Trust shall continue to be fully effective. This Trust shall be construed in accordance with applicable federal law, and to the extent otherwise applicable, the laws of the State of Colorado. IN WITNESS WI~REOF, the undersigned parties have executed this Trust Agreement on i~ec.o,,.,k,~,. ~ /99S , J ~~~.ti`~mrilttllfl~m.•.._ o~~o~o~ ~~Ury~ Z~ ~8 Y b~ ~a Ne~,O Ba.B~s2asa~ao tas.aT EMPLOYER TOWN OF VAIL By: lCS: ~ G ~ ~r TRUSTEE, ~ ~% ~{ ~' ~''~~ .mil By: Its: ~~Fc[~Tx%y 7 TOWN OF VAIL DEFERRED COMPENSATION PLAN as of December 31, 1998} BRBL52084L300 i95~02 TABLE OF CONTENTS Page Number Section .1. Definitions ................................................................................................................. 1 1. l Administrator ................................................................................................................. 1 1.2 'Beneficiary ..................................................................................................................... 1 1.3 .Code ............................................................................................................................... 1 . 1.4 Compensation ...................:........................................:..........................................:.........1 1.5 Deferral ........................................ .............................. . ....................................... 1 1.6 Effective Date ................................................................ . ...................:................:........ 1 1.7 Eligible Employee .......................................................................................................... 1~ 1.8 Eligible Deferred Compensation Plan or Eligible Plan .................................................... 1 1.9 Employer ........................................................................................................................1 1.10 Includable Compensation ............................................................................................ 1 1.11 Normal Retirement Age .............................................................................................. 2 1.12 Participant .................................................................................................................. 2 1.13 P1an ............................................................................................................................ 2 1.14 Plan Year .................................................................................................................... 2 1.15 Retirement Board .........:.... ...................._.................................._............................... 2 1.16 Trust or Trust Fund ..................................................................................................... 2 1.17 Trustee ........................................................................................................................2 1.18 Voluntary Salary Deferral Agreement ......................................................................... 2 Section 2. Participation .......................................•--..................................................................... 2 2.1 Eligibility for Participants ............................................................................................... 2 2.2 Enrollment ......................................................................................................................3 Section 3. Deferral of Compensation .......................................................................................... 3 3.1 Deferral Procedure .......................................................................................................... 3 3.2 Maximum Deferral :........................................................................................................ 3 3.3 Minimum Deferral .......................................................................................................... 4 3.4 Changing Deferrals ......................................................................................................... 4 3.5 Suspension of Deferrals .............................................:..........................................:...... 4 Section 4: Time, of Benefit Payment ..............................................:......................................... 4 4.1 Eligibility for Payment ........................................ ..................................:..................... 4 4.2 Benefit Commencement Date ......................................................................................... 5 Section 5. Benefit Payments ....................................................................................................... 7 5.1 Eiection ..... ..................................................................................................................... 7 5.2 Form of Payment ............................................................................................................ 7 5.3 Limitations ................ ...........................................................................................:..... 7 Section 6. Beneficiaries .............................................................................................................. 8 6.1 Designation .................................................................................................................... 8 6.2 Failure to Designate a Beneficiary .................................................................................. 8 Section 7. Amendment and Ternunation ........................................... ... 9 7. l Amendment .................................................................................................................... 9 7.2 Termination ....................................................................................................................9 Section 8. Miscellaneous ..........................................................................................:................. 9 8.1 General Duty of the Employer ........................................................................................ 9 Bft.BLS 2034ti300199:U2 8.2 Duties of the Administrator ............................................................................................. 9 3 Investments ...................................................................................................................10 4 Plan-to-Plan Transfers ................................................................................................ i 0 8.5 Ownership of Assets ...................................................................................................10 8.6 Limitation of Rights; Employment Relationship ............................................................10 8.7 Limitation on Assianrr,Pnt ..........................................................................................:...10 8.8 Representations ..............................................................................................................10 8.9 Severability ..................................................................•-----.._,...............---......................11 8.10 Applicable Law ..............................................................................................1...........11 ii i • TOWN OF VAIL DEFERRED COMPENSATION PLAN The Town of Vail, Colorado, hereby establishes,.with this Agreement, a plan for the administration and distribution of contributions made by the Employer for the purpose of providing deferred compensation far Eligible Employees. The plan shall be known as the TOWN OF VAIL DEFERRED COMPENSATION PLAN. This Plan shall be effective as of the Effective Date. ~ ~ _ Section 1. Definitions 1.1 Administrator: "A~m~nistrator" means the Employer or the entity designated by the Employer to carry out certain nondiscretionary administrative functions of the Plan pursuant to Section 8.2 of the Plan. 1.2 Bene~lciary: "Beneficiary" means the person(s) or estate entitled to receive benefits under this Plan after the death of a Participant. 1.3 Code: "Code" means the Internal Revenue Code of 1986, as amended, and including all regulations promulgated pursuant thereto. 1.4 Compensation: "Compensation" means the total remuneration earned by an employee for personal services rendered to the Employer for the calendar year, including amounts deferred under this Plan and any other deferred compensation plan. 1.5 Deferral: "Deferral" means the annual amount of Compensation that a Participant elects to defer receipt of pursuant to a properly executed Voluntary Salary Deferral Agreement. 1.6 ~ Effective Date: "Effective Date" means December 31, 1998. 1.7 Eligible Employee: "Eligible Employee" means any person, excluding independent contractors and seasonal employees, who performs services for the Employer as a regular full-time Employee and who receives compensation from the Employer far the services performed. 1.8 Eligible Deferred Compensation Plan or Eligible Plan: "Eligible Deferred Compensation Plan" or "Eligible Plan" means any plan defined in Section 4S7(b) of the Code and includes this Plan, among others. 1.9 Employer: "Employer" means the Town of Vail, Colorado. 1.1 p Includable Compensation: "Includable Compensation" means compensation for services performed far the Employer which {taking into account the provisions of Section 457 of the Code and other provisions of Chapter 1 ofthe Code) is currently includable BRB1520841300199.02 in grass income as property reportable on the employee's federal tax form relating to his or her wage and tax statement, 1.11 Normal Retirement Age: "Normal Retirement Age" means age 70-'/ or some other earlier age specified in writing by the Participant. In no event shall Normal Retirement Age be earlier than the earliest date at which one may retire under the Employer's basic pension plan without the Employer's consent and receive immediate retirement benefits, without incurring an actuarial or similar reduction in benefits. 1.12 Participant: "Participant" means an Eligible Employee or farmer Eligible Employee who is or has been enrolled in the Plan and wha retains the right to benefits under the Plan. 1.13 Plan: "Plan" means the Town of Vail Deferred Compensation Plan dated the 31S' day of December, 199$, as amended from time to time. 1.14 Plan Year: "Plan Year" means the twelve-month period beginn;~,g January 1 and ending December 31, from and after the Effective Date. 1.15 Retirement Board: "Retirement Board" means the board appointed pursuant to Section 2.14 ofthe Town of Vail Employees' Pension Plan, adopted January 1, 1994, as amended and restated from time to time. 1.16 Trust or Trust Fund: "Trust" or "Trust Fund" means the Trust Fund established in conjunction with this Plan, pursuant to the Town of Vail Deferred Compensation Trust Agreement. 1..17 Trustee: "Trustee" means the Trustees of the Trust Fund established in conjunction with this Plan and any duly appointed and qualified successor. The Trustee is also referred to as the Retirement Board. 1.1$ Voluntary Salary Deferral Agreement: "Voluntary Salary Deferral Agreement" means the agreement between a Participant and the Employer to defer receipt by the Participant of Compensation not yet earned. Such agreement shall state the Deferral amount to be withheld from a Participant's paycheck and shall became effective no earlier than the first day of any month after it is executed by the Farticipant and accepted by the Retirement Board. Section 2. Participation 2.1 Eligibility for Participants: Each Eligible Employee may become a Participant in this Plan on the first day of the month next following commencement of employment as an Eligible Employee and enrollment pursuant to Section 2.2. Any person elected or appointed to a term of office with the Employer shall be deemed to commence employment at the time such person assumes office. BRB~52084L300199:42 i ~ • 2.2 Enrollment: Eligible Employees may enroll in the Plan by completing a Voluntary Salary Deferral Agreement. Enrollment shall be effective on the first day of the month next following completion of the Voluntary Salary Deferral Agreement. Section 3. Deferral of Compensation 3.1 Deferral Procedure: Pursuant to a Voluntary Salary Deferral Agreement, each Participant's Deferral amount shall be deducted from his or her paychecks in approximately equal increments throughout the year. The Deferral amount shall not be included as gross income of the Participant for purposes of federal income tax. ~ - 3.2 Maximum Deferral: a) Primary Limitation: The Deferral amount in any, taxable year may not exceed the lesser of 7,500 (as indexed pursuant to Code §457(e)(15)), or 2. 33-113% of the Participant's Includable Compensation. b} Catch-Up Limitation: 1. A Participant may trigger the catch-up limitation by electing a Normal Retirement Age pursuant to Section 1.12. The maximum Deferral amount for each of a Participant's last three (3) taxable years ending before he or she attains Normal Retirement Age, is the lesser o£ i) $15,000, or ii) the primary limitation amount determined under Section 3.Z(a) for the current year, plus so much of the primary limitation amount that was not utilized in prior taxable years in which the employee was eligible to participate in the Plan, beginning after December 31, 19"1$. A Participant may use a prior year only if the Deferral amounts under the Plan in existence during the year were subject to the maximum deferral amount described in Treas. Reg. Section 1.457-2(e)(19$2}. 2. The catch-up limitation is available to a Participant only during one three-year period. If a Participant uses the catch-up limitation and then postpones Not~nal Retirement Age or returns to work after retiring, the limitation shall not be available again before a subsequent retirement. c) Coordination With Other Plans: Tf a Participant participates in more than one Eligible Deferred Compensation Plan, the total deferral under all plans shall be subject to the maximum limitations specified in Section 3.2. Any amount excluded from gross income by the Code under Code §§403{b), 402(e)(3), 402(h)(1)(B) ar 402{k} far the taxable year and a deduction which is allowable by reason of a contribution to an organization described in BRS~520841300199.U2 3 Section 501(c)(18) of the Code for the taxable year shall reduce the primary limitation amount determined under Section 3.2(a} and (b), and the $15,000 limitation in Section 3.2(b)(1}(i). 3.3 Minimum Deferral: A Participant must comply with any m~n~mum monthly deferral requirements which may be set by the Employer from time to time on a nondiscriminatory basis. 3.4 Changing Deferrals: A Participant may change Deferrals with respect to Compensation not yet earned by executing a new Voluntary Salary Deferral Agreement. The change shall be effective on the first day of the month following the month a new Voluntary - Salary Deferral Agreement is received by the Retirement Board. 3.5 Suspension of Deferrals: a) Voluntary: A Participant may suspend Deferrals by giving the Retirement Board written notice. Following suspension, a Participant may reinstate Deferrals by executing a new Voluntary Salary Deferral Agreement and delivering it to the Retirement Board. Reinstatement shall be effective on the first day of the month fallowing completion of the new Agreement. Deferral suspensions and resumptions can be made at any time. b) Automatic: Deferrals shall automatically be suspended for any month in which there are insufficient monies available to make the entire deduction agreed upon. Section 4. Time of Benefit Payment 4.1 Eligibility for Payment: Payments from the Plan shall not be made until the calendar year in which the Participant attains age 70-1/2, incurs a Separation from Service, or suffers an approved financial hardship that results from an unforeseeable emergency. a) Separation from Service: "Separation from Service" means the termination of a Participant's employment with the Employer within the meaning of Code . Section 402(e)'(4)(A}(iii}. b} Hardship Withdrawal: 1. Procedure: A Participant may request a withdrawal far Hardship by submitting a written request to the Retirement Board, accompanied by evidence that his or her financial condition warrants an advance release of funds and results from an unforeseeable emergency which is beyond the Participant's control. The Retirement Board shall review the request and determine whether payment of any amount is justified. if payment is justified, the amount shall be limited to an amount reasonably needed to meet the emergency. The Retirement Board shall det~Ax~,ine the amount and form of payment. Any money remaining in the account after Hardship Withdrawal shall be distributed in accordance with the provisions of this Plan. 2. Hardship Defined: "Hardship" means a severe financial setback to the Participant resulting from a sudden and unexpected illness or accident of the BRB15 2 0 3 413 00 1 99.42 4 Participant or a dependent of the Participant, loss of the Participant's property due to casualty, or other similar extraordinary and unforeseeable circumstances, arising from events beyond the Participant's control. Whether circumstances constitute an unforeseeable emergency depends on the facts. of each case, but, in any case, payment may not be made to the extent that such hardship is or may be relieved: i} through reimbursement or compensation by insurance or~otheruvise; ii) by liquidation of the Participant's assets, to the extent that liquidation itself would not cause severe financial hardship; or iii) by cessation of Deferrals under the Plan. Unforeseeable emergencies shall not include the payment of college tuition or the purchase of a residence. 3. Hardship Withdrawals After Benefit Commencement: Once regular installment payments to a Participant have commenced under the Plan, the Participant may request payment acceleration if the Participant suffers a Hardship as defined above. The Retirement Board may permit accelerated payments; however, the amount of an accelerated payment shall not exceed the amount needed to meet the emergency. Any amount remaining in the account after such accelerated payment shall be distributed in accordance with the provisions of this Plan 4.2 Benefit Commencement Date: a) Early Commencement Date: Except for a Hardship Withdrawal pursuant to Section 4.1(b), benefit payments to a Participant shall not commence to Participants or Beneficiaries earlier than the earliest of: . 1. the calendar year in which the Participant attains age 7U-1l2, 2. 50 days after the Participant incurs a Separation from Service with the Employer, or 3. d0 days fallowing the death of the Participant. b} Participant Election: Within 6d days after Separation from Service, a Participant may make an election of a specific date for commencement of benefits, the Benefit Commencement Date", that is the first day of a month, provided that the date elected is not earlier than the "Earliest Benefit Commencement Date" determined under Section 4.2(a} and is not later than the "Latest Benefit Commencement Date" determined under Section d.2 (f), and may also make an election of the farm of payment. The election of a Benefit Commencement Date may he changed once, provided that the election is made prior to the actual commencement of benefit distributions and the date elected is no Iater than the Latest Benefit Commencement Date. The election of the form of payment may also be changed once, provided that the notice of BRB152Q641300 L99.02 5 the change is received by the Retirement Board, not later than 30 days before the date on which benefit payments are to commence. c) Failure to Make Timely Election: If a Participant fails to make an election of a date for commencement of benefits within the time period specified in Section 4.2(b}; then benefit payments will commence an the first day of the month that is coincident with or immediately follows b0 days after the later of {i} the date on which the Participant attains age 60, ar (ii) the date of the Participant's Separation from Service. If a Participant fails to make an election of the form of payment within the time period specified in Section 4,2(b}, then the benefit will be paid in the form of a Lump Sum. •. d} Spouse Beneficiary Election: Subject to Section 4.2(e}, a spouse Beneficiary entitled to benefits may make aone-time irrevocable election to defer commencement of benefits to a date that is on the first day of the month that is coincident with or immediately follows the latest of the dates specified in Section 4.2(a). Such election may be made at any time prior to the Benefit Commencement Date by completing and delivering to the Retirement Board forms provided for this purpose. e} Non-spouse Beneficiary Election: Anon-spouse Beneficiary entitled to benefits may make aone-time irrevocable election to defer commencement of benefits to a date which is no later than December 31 of the year following the year of the Participant's death, or the Beneficiary may elect a later commencement date, provided that benefit payments are completed by December 31 of the year which contains the five-year anniversary of the Participant's death. fj Latest Benefit Commencement Date: Notwithstanding any other Plan provision to the contrary, benefits for a Participant or Beneficiary shall commence no later than the later of: (i) April 1 of the calendar year following the calendar year in which the Participant attains age 70-112, or (ii) 60 days after the date on which the Participant incurs Separation from Service with the Employer. Notwithstanding the foregoing, the Participant may elect to defer the commencement of distribution of benefits to a fixed determinable date later than the date described above, blot not later than April 1 of the year following the year of the Participant's retirement ar attainment of age 70-112, whichever is later, provided: 1, such election is made after the 615L day following separation from service and before commencement of distributions; and 2, the Participant may make only one {1) such election. Notwithstanding the foregoing, the Trustee, in order to ensure the orderly administration of this provision, may establish a deadline after which such election to defer the commencement of distribution of benefits shall not be allowed. g) DeMinimis Accounts: Notwithstanding any other Plan provision to the contrary, if the value of a Participant's account does not exceed $5,000, and (1} no amount has been deferred under the Plan with respect to the Participant during the 2-year period ending on the date of distribution; and (2) there has been no prior distribution under the Plan to the BR615~0841300195.02 6 Participant pursuant to this Section 4, 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 lump sure. Section 5. Benefit Payments 5:1 Election: A Participant or Beneficiary may elect the form of payment of benefits pursuant to Section 4.2{b}. 5.2 Form of Payment: A Participant or Beneficiary may elect payment i~ one - ofthe following forms: a) Lump Sum: A single payment of the entire balance in a Participant's account. b) Annuity: Monthly payments contingent on the life expectancy of the Participant or Beneficiary, or over such life expectancy and a guaranteed period of time. c) Installments: Subject to the limitations of Section 5.3, monthly payments over a specified period of time or in specified annual dollar amounts. d) Combination: A lump sum cash payment of a portion of the balance in a Participant's account, with the remainder of the account to be paid in substantially equivalent monthly installments as specified by the Participant. The election of a schedule of installment payments is irrevocable. ___ 5.3 Limitations: Notwithstanding any Plan provision to the contrary or any form of payment election, the Plan must meet the minimum distribution requirements of Cade 457(d)(2} and 401 (a){9} and the Treasury regulations thereunder. a) If benefits commence before the Participant's death, the Participant must elect a form under which: 1. benefits will be paid aver a period not extending beyond the life expectancy of the Participant or the joint life expectancies of the Participant and a designated Beneficiary, 2. any amount payable to the Beneficiary must be distributed at least as rapidly as benefits were distributed to the Participant immediately prior to death, and 3. on the date benefits commence, the Participant is expected to receive during hislher life expectancy more than 50% of the total value of the benefits. b) If benefits commence after the Participant's death, the entire amount payable must be distributed: s[ta~szosa~ao~99:az 7 1. within the life expectancy of a spouse Beneficiary, ar 2. for non-spouse Beneficiaries, within fifteen years after the death of the Participant, provided benefits commence by December 31 of the year following the year in which the Participant's death occurs, or 3. for non-spouse Beneficiaries who elect a later Benefit Commencement Date, by December 31 ~af the calendar year containing the five-year anniversary of the Participant's death. c) Upon the death of a Participant whose payments-have commenced, the Beneficiary shall receive further payments only to the extent provided in the farm of payment then in effect, subject to the limitations stated herein., Section 6. Beneficiaries 6.1 Designation: A Participant shall have the right to designate a Beneficiary, and amend or revoke such designation at any time, in writing. Such designation, amendment or revocation shall be effective upon receipt by the Retirement Board. Notwithstanding the foregoing, a Participant who elects a joint and survivor annuity form payment may not elect a non-spouse joint annuitant, and may not change his or her joint annuitant after payments commence. 6.2 Failure to Designate a Beneficiary: If no designated Beneficiary survives the Participant and benefits are payable fallowing the Participant's death, the Retirement Board may direct that payment of benefits be made to the person or persons in the first of the following classes of successive preference Beneficiaries. The Participant's: a) spouse, b) descendants, per stirpes, c) parents, in equal shares, d) brothers and sisters, in equal shares, e) estate. axs~szasal~aoi99.az Secrion 7. Amendment and Termination 7.1 Amendment: (a) The Employer may amend this Plan by transmitting such amendment in writing to the Trustee at least 30 days prior to the effective date of the amendment. The consent of the Trustee shall not be required in order for an amendment to become effective; however, the Trustee shall be under no obligation to continue to act as Trustee if it disapproves of the amendment. Except as may be required to maintain the status of the Plan under Section 457 of the Code or to comply with other applicable laws, no amendment or termination o.f the Plan shall divest any Participant of any rights with respect to Deferrals before the date of amendment or t~~l~unation. ~ ~ ~ . • . b) The Trustee may propose an amendment to the Plan at any time by written notice to the Employer at least 30 days before the effective date of the amendment. If the Trustee approves an amendment to the Plan, such amendment shall automatically be effective with respect to the Employer unless the Employer notifies the Trustee in writing within b0 days after the date of approval of the amendment that the Employer objects to the amendment. The Trustee shall be under no obligation to continue to act as Trustee if the Employer disapproves of any amendment. 7.2 Terminatinn: Although the Employer has established this Plan with a bona~de intention and expectation to maintain the Plan indefinitely, the Employer may terminate the Plan in whole or in part at any time without any liability for such termination or discontinuance. Upon termination of the Plan, the Employer shall notify the Trustee in writing of the effective date of termination of the Plan. Upon Plan termination, all Deferrals shall cease. The Trustee shall retain all Deferrals until each Participant attains age 70-112, incurs a Separation from Service or incurs a Hardship and benefits commence under Sections 4.1 and 4.2, in the form determined under Section 5. Section 8. Miscellaneous S.1 General,Duty of the Employer: All amounts of compensation deferred under the Plan shall be transferred to the Trust Fund established in accordance with Code 457(g}. The Employer shall make regular periodic payments to the Trustee equal to the amount of its participating Employees' total Deferrals. Tke Employer shall have the authority to make all discretionary decisions affecting the rights or benefits of Participants under this Plan. 2 Duties of the Administrator: The Administrator shall perform all nondiscretionary administrative functions in connection with the Plan, including the maintenance of accounts on behalf of each Participant, the provision of periodic reports on the status of each account and the disbursement of benefits on behalf of the Employer in accordance with the provisions of this Plan. The Employer shall be the Administrator of the Plan, provided, that the Employer may appoint a third parry administrator to perform certain administrative functions. BRB~5208A1300199.fl2 f ~ i~ ~ ~ The duties and compensation of any such third party administrator shall be by agreement between the Employer and third party administrator. 8.3 Investments: A Participant or Beneficiary of the Plan may request that Deferrals under the Plan be allocated among available investment options established by the Trlrstee. The initial allocation request may be made at the time of enrollment. Investment allocation requests shall remain effective with regard to all subsequent Deferrals, until changed in accordance with the provision of this section. A Participant ar Beneficiary may change his or her allocation request once a month after earnings have been allocated, by notifying the Trustee in writing. Such, changes shall become effective as soon as administratively feasible. 'While the Trustee intends to invest Deferrals according to the Participant requests, it reserves the right to invest Deferrals without regard to such requests. 8.4 Plan-tQ-Plan Transfers: Notwithstanding any other Plan provision, distribution of amounts deferred by a former Participant of this Plan shall not commence~upon Separation from Service, but instead shall be automatically transferred to another Eligible Deferred Compensation Plan, of which the former Participant has become a Participant, if: a} the Plan receiving such amounts provides for their acceptance, and b) the Participant incurs a Separation from Service with the Employer in order to accept employment with another "eligible" entity. The Trustee will accept the transfer of amounts previously deferred by a Participant under another Eligible Deferred Compensation Plan. The Trustee may refuse to accept a transfer in the form of assets other than cash. 8.5 Ownership of Assets: All amounts deferred under the Plan and contributed to the Trust, all property and rights purchased with such amounts, and all income attrl`butable to such amounts, property or rights shall be held for the exclusive purposes of providing benefits to Participants and Beneficiaries and defraying reasonable expenses •of administering the Plan and Trust. 8.6 Limitation of Rights; Employment Relationship: Neither the establishment of this Plan nor any modification thereof, nor the creation of any fund or account, nor the payment of any benefits, shall be construed as giving a Participant or other person any legal or equitable right against the Employer except as provided in the Plan. In no event shall the terms of employment of any employee be modified or in any way be affected by the Plan. 8.7 Lin~itatian on Assignment: Benefits under this Plan. may not be assigned, sold, transferred, or encumbered, and any attempt to do so shall be void. A Participant's or Beneficiary's interest in benefits under the Plan shall not be subject to debts or liabilities of any kind and shall nat be subject to attachment, garnishment or other legal process. 8 Representations: The Employer does not represent or guarantee that any particular federal or state income, payroll, personal property or other tax consequence will result from participation in this Plan. A Participant should consult with professional tax advisors to B1tB1520S41300199.02 1 i ~ determine the tax consequences of his or her participation. Furthermore, the Employer does not represent or guarantee successful investment of Deferrals, and shall not be required to repay any OSS which may result from such Investment or lack of investment. 8.9 5everability: If a court of competent jurisdiction holds any provisions of this Plan to be invalid or unenforceable, the remaining provisions of the Plan shall continue to be fully effective. 5.10 Applicable Law: This ,Plan shall be construed in accordance with applicable federal law and, to the extent otherwise applicable, the laws of the State of Colorado. IN WITNESS WHEREOF the Employer has caused this Plan to be executed by its duly authorized representative this I~day of~49$. D~~e~~ EMPLOYER Witness: .ICQ ~ ~~ ~ll~-CLC~U~ U1~,~-- mu~tn;e:;:r,,,... Of y~ f~ E1~L c Q L o p A~ o~~~, BRB1520$41300 L94.02 11 Town of V BY~ Title: ~~Q, I} t''