Common use of ADP Limit Clause in Contracts

ADP Limit. For any Plan Year, the Committee shall have the right to limit or reduce the Elective Contributions of Participants who are Highly Compensated Employees in order to insure that the actual deferral percentage limitation under Code Section 401(k)(3) (hereinafter “ADP Limit”) is not exceeded. Furthermore, in accordance with 26 CFR Section 1.401(k)-1(f), the Employer may make additional Qualified Nonelective Contributions and/or Matching Contributions or may distribute or recharacterize such contributions made during the Plan year in order to provide that the ADP Limit is not exceeded. The ADP Limit is equal to the greater of Limit 1 or Limit 2: Limit 1: The average Actual Deferral Percentage for the Plan Year of Participants who are Highly Compensated Employees may not exceed one hundred twenty-five percent (125%) of the Actual Deferral Percentage for the previous Plan Year of all other Participants; or Limit 2: The Actual Deferral Percentage for the Plan Year of Participants who are Highly Compensated Employees may not exceed the lesser of: (a) The Actual Deferral Percentage for the previous Plan Year of all other Participants, plus two percent (2%), or (b) The Actual Deferral Percentage for the previous Plan Year of all other Participants, multiplied by two hundred percent (200%). The Actual Deferral Percentage (“ADP”) with respect to any specific group of Participants for a Plan Year shall mean the average of the ratios (calculated separately for each Participant in such group) of (A) the amount of Elective Contributions paid into the Trust Fund on behalf of each Participant for such Plan Year to (B) the Participant’s Adjusted Compensation for such Plan Year(such ratio hereinafter referred to as “ADR”). In the case of a Participant who is a Highly Compensated Employee who is eligible to have Elective Contributions paid in to a Trust Fund to his or her account under two or more plans maintained by the Employer, the ADP shall be determined as if all such Elective Contributions were made under a single arrangement. For purposes of determining the ADP, the Plan will take into account the ADR of all eligible employees. An eligible employee is any employee who is directly eligible to make a cash or deferred election under the plan for all or a portion of a Plan Year, and includes: (i) an employee who would be a Plan participant but for the failure to make required contributions; (ii) an employee whose eligibility to make Elective Contributions has been suspended because of an election (other than certain one-time elections) not to participate, taking a hardship distribution, or to obtain a participant loan; and (iii) an employee who cannot defer because of the Section 415 limits on Annual Additions. In the case of an eligible employee who makes no Elective Contributions, the ADR that is to be included in determining the ADP is zero. For purposes of determining whether a plan satisfies the ADP Limit, all Elective Contributions that are made under two or more plans that are aggregated for purposes of Sections 401(a)(4) or 410(b) (other than Section 410(b)(2)(A)(ii)) are to be treated as made under a single plan. If two or more plans are permissively aggregated for purposes of Section 401(k), the aggregated plans must also satisfy Sections 401(a)(4) and 410(b) as though they were a single plan. Plans will be aggregated only if they have the same plan year and use the same testing method. Qualified Nonelective Contributions and Matching Contributions may be treated as Elective Contributions for purposes of the ADP Limit only if such contributions are nonforfeitable when made and subject to the same distribution restrictions that apply to Elective Contributions. Qualified Nonelective Contributions which may be treated as Elective Contributions must satisfy these requirements without regard to whether they are actually taken into account as Elective Contributions. Qualified Nonelective Contributions may be treated as Elective Contributions only if the conditions described in Proposed Treasury Regulation Section 1.401(k)-2(a)(6) are satisfied, including, without limitation, that they (i) be contributed by the end of the year following the applicable year, and (ii) not exceed the product of a Non-Highly Compensated Employee’s Adjusted Compensation and the greater of 5% or two times the Plan’s Representative Contribution Rate. For this purpose, the term “Representative Contribution Rate” is the lowest applicable contribution rate of any eligible Non-Highly Compensated Employee among a group of eligible Non-Highly Compensated Employees that consists of half of all eligible Non-Highly Compensated Employees for the Plan Year (or, if greater, the lowest applicable contribution rate of any eligible Non-Highly Compensated Employee in the group of all eligible Non-Highly Compensated Employees for the Plan Year and who is employed by the Employer on the last day of the Plan Year).

ADP Limit. For any Plan Year, the Committee shall have the right to limit or reduce the Elective Contributions of Participants (a) The Average Actual Deferral Percentage for Eligible Employees who are Highly Compensated Employees in order to insure that the actual deferral percentage limitation under Code Section 401(k)(3) (hereinafter “ADP Limit”) is not exceeded. Furthermore, in accordance with 26 CFR Section 1.401(k)-1(f), the Employer may make additional Qualified Nonelective Contributions and/or Matching Contributions or may distribute or recharacterize such contributions made during for the Plan year in order to provide that the ADP Limit is Year shall not exceeded. The ADP Limit is equal to exceed the greater of Limit 1 or Limit 2of: Limit (1: The average ) the Average Actual Deferral Percentage for Eligible Employees who are Nonhighly Compensated Employees for the Plan Year of Participants who are Highly Compensated Employees may not exceed one hundred twenty-five percent multiplied by 1.25; or (125%2) of the lesser of: (A) the Average Actual Deferral Percentage for Eligible Employees who are Nonhighly Compensated Employees for the previous Plan Year of all other Participantsmultiplied by 2.00; or Limit 2: The or (B) the Average Actual Deferral Percentage for Eligible Employees who are Nonhighly Compensated Employees for the Plan Year of Participants who are Highly Compensated Employees may not exceed the lesser of: (a) The Actual Deferral Percentage for the previous Plan Year of all other Participants, plus two percent (2%), or2 percentage points. (b) The Actual Deferral Percentage for the previous Plan Year of all other Participants, multiplied by two hundred percent (200%). The Actual Deferral Percentage (“ADP”) with respect to any specific group of Participants for a Plan Year shall mean the average of the ratios (calculated separately for each Participant in such group) of (A) the amount of Elective Contributions paid into the Trust Fund on behalf of each Participant for such Plan Year to (B) the Participant’s Adjusted Compensation for such Plan Year(such ratio hereinafter referred to as “ADR”). In the case of a Participant Eligible Employee who is a Highly Compensated Employee for the Plan Year and who is eligible to have Elective Contributions paid participate in to a Trust Fund to his or her account under two or more plans maintained by of the EmployerEmployer to which elective deferrals are made, the ADP shall be determined as if by aggregating all such Elective Contributions were made under a single arrangement. For purposes elective deferrals on behalf of determining the ADP, the Plan will take into account the ADR of all eligible employees. An eligible employee is any employee who is directly eligible to make a cash or deferred election under the plan for all or a portion of a Plan Year, and includes: (i) an employee who would be a Plan participant but for the failure to make required contributions; (ii) an employee whose eligibility to make Elective Contributions has been suspended because of an election (other than certain one-time elections) not to participate, taking a hardship distribution, or to obtain a participant loan; and (iii) an employee who cannot defer because of the Section 415 limits on Annual Additions. In the case of an eligible employee who makes no Elective Contributions, the ADR that is to be included in determining the ADP is zero. For purposes of determining whether a plan satisfies the ADP Limit, all Elective Contributions that are made under two or more plans that are aggregated for purposes of Sections 401(a)(4) or 410(b) (other than Section 410(b)(2)(A)(ii)) are to be treated as made under a single plansuch Highly Compensated Employee. If two or more plans of the Employer are permissively aggregated for purposes of Section 401(k)) of the Code, the aggregated plans must also satisfy Sections Section 401(a)(4) and 410(b) of the Code as though they were a single plan. Plans will be If one or more plans of an Employer are aggregated only if they have with the same plan year and use the same testing method. Qualified Nonelective Contributions and Matching Contributions may be treated as Elective Contributions Fund for purposes of satisfying the requirements of Section 401(a)(4) or 410(b) of the Code, the Actual Deferral Percentages under the Fund shall be calculated as if the Fund and such one or more other plans were a single plan. (c) For purposes of applying the ADP Limit, Testing Compensation shall be computed on an entire Plan Year basis and with reference to the current Plan Year at the time the ADP Limit only if is applied. Reductions and increases made to satisfy such contributions limit shall not affect persons who are nonforfeitable when made and subject not then Eligible Employees. Where limits are computed prior to the same distribution restrictions that apply to Elective Contributions. Qualified Nonelective Contributions which may be treated as Elective Contributions must satisfy these requirements without regard to whether they are actually taken into account as Elective Contributions. Qualified Nonelective Contributions may be treated as Elective Contributions only if the conditions described in Proposed Treasury Regulation Section 1.401(k)-2(a)(6) are satisfied, including, without limitation, that they (i) be contributed by the end of the year following the applicable year, and (ii) not exceed the product of a Non-Highly Compensated Employee’s Adjusted Compensation and the greater of 5% or two times the Plan’s Representative Contribution Rate. For this purposePlan Year, the term “Representative Contribution Rate” Plan Administrator may estimate or project Testing Compensation. The Plan Administrator may elect to include in a person’s Testing Compensation only Compensation received while such person was an Eligible Employee, provided the election is the lowest applicable contribution rate of any eligible Non-Highly Compensated Employee among a group of eligible Non-Highly Compensated Employees that consists of half of applied uniformly to all eligible Non-Highly Compensated Eligible Employees for the Plan Year Year. (or, if greater, the lowest applicable contribution rate d) Except for purposes of any eligible Non-Highly Compensated Employee in the group of all eligible Non-determining Highly Compensated Employees for and Nonhighly Compensated Employees, the Plan Year and who is employed by the Employer on the last day portion of the Plan Year)Fund that benefits Employees who are included in a unit of employees covered by a collective bargaining agreement is treated as a separate plan from the portion of the Fund that benefits Employees who are not so covered.