Common use of Allocation to Highly Compensated Employees Clause in Contracts

Allocation to Highly Compensated Employees. Excess Aggregate Contributions will be allocated to the Highly Compensated Employees with the largest Contribution Percentage Amounts taken into account in calculating the ACP Test for the Plan Year in which the Excess Aggregate Contributions arose, beginning with the Highly Compensated Employee with the largest amount of such Contribution Percentage Amounts and continuing in descending order until all the Excess Aggregate Contributions have been allocated. For purposes of the preceding sentence, the “largest amount” is determined by including and excluding such Employer contributions and allocations that are described in the definition of “Contribution Percentage Amounts.” Excess Aggregate Contributions will be treated as Annual Additions, even if such Excess Aggregate Contributions are distributed.