AGN » Topics » DEFERRAL ACCOUNTS

This excerpt taken from the AGN 10-K filed Feb 27, 2009.

DEFERRAL ACCOUNTS

5.1       Deferral Accounts.    Solely for record keeping purposes, up to three Deferral Accounts (one Termination Benefit Account and up to two Scheduled In-Service Withdrawal Accounts) shall be established and maintained for each Participant. Pursuant to a Participant’s Distribution Election Form, the Deferral Accounts shall be credited with the following:

(a)      Annual Deferrals.  Annual Deferrals, if any, shall be credited at the time such amounts would otherwise have been paid to the Participant for the Plan Year.

(b)      Matching Contribution Restoration Credit.  If a Participant has contributed the maximum “Before Tax Deposits” (as defined in the Savings and Investment Plan) permitted under Section 4.2 of the Savings and Investment Plan (but without regard to the catch-up provisions of Section 4.2(e) of the Savings and Investment Plan and Code Section 414(v)) for the Plan Year, then such Participant’s Deferral Account(s) for such Plan Year shall be credited with a “Matching Contribution Restoration Credit” equal to the excess of the dollar amount or value of (i) the Participant’s “Matching Contributions” (as defined in the Savings and Investment Plan), without regard to trust income or earnings, based on such Participant’s “Matched Deposits” (as defined in the Savings and Investment Plan), and such Participant’s “Compensation” (as defined in the Savings and Investment Plan) as increased by any Annual Deferrals made under this Plan up to the limitation imposed by Code Section 401(a)(17), over (ii) the Participant’s actual “Matching Contributions” for the

 

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Plan Year under the Savings and Investment Plan. The Matching Contribution Restoration Credit (if any) shall be credited to a Participant’s Deferral Account for such Plan Year after the end of the Plan Year to which such credit relates and after the Participant’s “Matching Contributions” for such Plan Year under the Savings and Investment Plan are determined, but not later than the end of the Plan Year following the Plan Year to which such credit relates.

(c)      Retirement Contribution Restoration Credit.  If a Participant is a “Retirement Account Participant” (as defined in the Savings and Investment Plan) and is eligible to receive a Retirement Contribution allocation pursuant to Section 5.4 of the Savings and Investment Plan for a Plan Year, e.g., employed by the Company on the last day of the Plan Year, then such Participant’s Deferral Account(s) for such Plan Year shall be credited with a “Retirement Contribution Restoration Credit,” the amount of which is equal to the excess of the dollar amount of (i) such Participant’s “Retirement Contribution” (as defined in the Savings and Investment Plan), without regard to trust income or earnings, based on the Participant’s “Compensation” (as defined in the Savings and Investment Plan) as increased by any Annual Deferrals made under this Plan and without regard to the limitations imposed by Code Sections 401(a)(4), 401(a)(17) and 415, over (ii) such Participant’s actual “Retirement Contribution” for such Plan Year under the Savings and Investment Plan. The Retirement Contribution Restoration Credit (if any) shall be credited to a Participant’s Deferral Account(s) for such Plan Year after the end of the Plan Year to which such credit relates and after the Participant’s “Retirement Contribution” for such Plan Year under the Savings and Investment Plan is determined, but not later than the end of the Plan Year following the Plan Year to which such credit relates.

(d)      ESOP Restoration Credit.  A Participant’s Deferral Account(s) may also contain an ESOP Restoration Credit, for Plan Years beginning prior to January 1, 2003.

The amounts (if any) to be credited to a Participant’s Deferral Accounts pursuant to paragraphs (b) and (c) above shall be credited after the end of the Plan Year to which such credits relate and after such Participant’s actual “Retirement Contribution” and actual “Matching Contributions” (each as defined in the Savings and Investment Plan) for such Plan Year under the Savings and Investment Plan are determined, but not later than the end of the Plan Year following the Plan Year to which such credits relate.

A Participant’s Restoration Credits shall be credited to the Participant’s Termination Benefit Account under Article VI and shall not be eligible for distribution as a Scheduled In-Service Withdrawal under Article VII.

5.2       Investment Earnings on Deferral Accounts.  The Deferral Accounts of a Participant shall be credited with investment earnings at the Fund Rate or interest at the Company Rate, if applicable, as provided in Section 5.3. For any portion of a Deferral Account to which the Company Rate is applicable, such portion of the Deferral Account shall be credited each month with interest which shall be compounded on an annual basis under rules determined by the Committee in its sole discretion.

 

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5.3       Participant Investment Elections.

(a)      Deferrals and Restoration Credits.  Any Annual Deferrals made by a Participant and any Restoration Credits credited to a Participant’s Deferral Account with respect to a Deferral Period shall be credited with investment earnings at the Fund Rate and shall not be eligible to be credited with interest at the Company Rate. The investment allocation of a Participant’s Restoration Credits to Fund Media shall be the allocation selected by the Participant in his or her most recent Investment Election Form. If a Participant does not submit an Investment Election Form or otherwise select the Fund Media for his or her Restoration Credits, then such Restoration Credits shall be credited to Dodge & Cox Balanced Fund listed on Appendix A (or, if the Dodge & Cox Balanced Fund is unavailable for any reason, then such Fund Media as the Committee shall determine in its sole discretion), until superseded by a subsequent Investment Election Form properly completed and submitted by such Participant.

(b)      Amounts eligible for the Company Rate.  Certain grandfathered amounts that as of January 1, 2009 are invested at the Company Rate will continue to be eligible to accrue investment earnings at the Company Rate unless transferred to the Fund Rate under subsection (c) below. No other amounts are eligible for the Company Rate.

(c)      Transfers from Company Rate to Fund Rate.  Each Participant may request to change the investment of all or any portion of his or her Deferral Account from the Company Rate to the Fund Rate subject to the following conditions:

(i)      An Investment Election Form, which includes the allocation among Fund Media, must be submitted by such time as may be established by the Committee from time to time.

(ii)     An investment transfer from the Company Rate to the Fund Rate shall be irrevocable.

(d)      Allocation to Fund Media.  With respect to any portion of the Deferral Account to which the Fund Rate applies, the Participant may prospectively change the investment allocation to Fund Media on a periodic basis as set by the Company, but not less frequently than monthly, in whole or part by submitting an Investment Election Form or by using such electronic means and under such procedures as the Committee may permit.

5.4       Fund Media.  The initial Fund Media under the Plan shall be as set forth on Appendix A, attached hereto. The Committee may add or delete Fund Media in its sole discretion from time to time. In the event of a deletion of a Fund Media, the Committee is not required to provide a new Fund Media option with similar investment objectives as those of the deleted Fund Media. For any amounts for which a deleted Fund Media had been selected, the Committee, in its sole discretion, may select an alternative Fund Media, either a fixed income Fund Media or an existing Fund Media that has similar investment objectives as the deleted Fund Media, to which to assign those amounts until the Participant selects otherwise. The Committee shall have no liability or responsibility with respect to the absolute or relative return of such

 

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alternative Fund Media to which it assigns such amounts. Participants must make an investment allocation to Fund Media in whole percentages equal to one hundred percent (100%), in the aggregate, of the amount invested in Deferral Accounts to which the Fund Rate applies.

5.5       Vesting of Deferral Account.

(a)      A Participant shall be fully vested in his or her Annual Deferrals, Matching Contribution Restoration Credits, and ESOP Restoration Credits.

(b)      A Participant shall vest in his or her Retirement Contribution Restoration Credits and any investment earnings thereon in accordance with the following schedule:

 

Years of Service    Vested Percentage
Less than 1        0%
1 but less than 2      20%
2 but less than 3      40%
3 but less than 4      60%
4 but less than 5      80%
5 or more    100%

For purposes of this Section 5.5, a Participant’s Years of Service under the Plan shall be equal to the Participant’s “Credited Service” (as defined in the Savings and Investment Plan) credited to such Participant under the Savings and Investment Plan.

Upon a Participant’s Termination of Employment, any unvested amounts and applicable investment earnings thereon shall be forfeited after 90 days from the Termination of Employment, as of the last day of the month in which the 90-day period ends, and his or her Deferral Accounts will be adjusted accordingly. Any forfeited amounts shall be used to offset Restoration Credits to be made by the Company for the following Plan Year.

(c)      Notwithstanding paragraph (b) above, a Participant shall become fully vested in his or her Retirement Contribution Restoration Credits and any investment earnings thereon, if while employed by the Company, (i) he or she attains age 62, (ii) he or she dies, (iii) he or she incurs a “Severance” due to a “Disability” (as each term is defined in the Savings and Investment Plan), or (iv) a Change in Control occurs as defined in Section 11.2.

5.6       Statement of Accounts.  The Committee shall provide to each Participant periodic statements setting forth the balance of the Deferral Accounts maintained for such Participant. Notwithstanding anything contained in such statements, the provisions of the Plan shall govern exclusively the actual rate of investment earnings to be credited and paid.

 

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