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HomeMy WebLinkAboutRES CC 2001 1931 2001 1219RESOLUTION NO. 2001 -1931 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF MOORPARK, CALIFORNIA, ADOPTING A DEFERRED COMPENSATION PLAN AND TRUST /CUSTODIAL DOCUMENT AND RESCINDING RESOLUTION 98 -1532 WHEREAS, the City of Moorpark has employees currently participating in a 457 deferred compensation retirement savings plan administered by National Deferred Compensation; and WHEREAS, the City of Moorpark wishes to adopt the Plan and Trust /Custodial Document which reflect the current statutory requirements for eligible deferred compensation plans; and WHEREAS, National Deferred Compensation is able administer the deferred compensation plan for the City of Moorpark in accordance with the terms of this agreement. NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF MOORPARK DOES HEREBY RESOLVE AS FOLLOWS: SECTION 1. The City of Moorpark hereby established the Deferred Compensation Plan and adopts the 457 Plan and Trust /Custodial Document attached hereto as Exhibit "A" and made a part hereof. SECTION 2. The assets of the plan shall be held in a Trust /Custodial Fund, with the City of Moorpark or its designated officer appointed as serving as trust/ custodian, for the exclusive benefit of the Plan participants and beneficiaries, and the assets shall not be diverted for any other purpose. The City of Moorpark's beneficial ownership of Plan assets shall be held for the further exclusive benefit of the Plan participants and beneficiaries. SECTION 3. The City of Moorpark or its designated officer is hereby authorized to execute all necessary agreements with National Deferred Compensation incidental to the administration of the Plan, and shall do all things necessary and proper to implement this Resolution. SECTION 4. Resolution 98 -1532 is hereby rescinded. Resolution No. 2001 -1931 Page 2 SECTION 5. The City Clerk shall certify to the adoption of this resolution and shall cause a certified resolution to be filed in the book of original Resolutions. PASSED AND ADOPTED this 19th da ATTEST: Deborah S. Traffenst dt, City Clerk 'PQI�Wlo ilii � i rarmw t1li, 'it Attached: Exhibit "A," Restated and Amended Deferred Compensation Plan and Trust /Custodial Document for Public Employees Resolution No. 2001 -1931 Page 3 RESTATED AND AMENDED DEFERRED COMPENSATION PLAN AND TRUST /CUSTODIAL DOCUMENT FOR PUBLIC EMPLOYEES The Plan consists of the provisions set forth in this document, and is applicable to each Participant who elects to participate in the Plan. The Plan is effective as to each such Participant upon the date he becomes a Participant by executing a Participation Agreement with the Administrator. Section 1. Name: The name of this Restated and Amended Deferred Compensation Plan and Trust/Custodial Document is the City of Moorpark, State of California, Deferred Compensation Plan, hereinafter referred to as the "Plan." This Plan is the continuation in restated form of the City of Moorpark Deferred Compensation Plan previously established by the Employer on October 21, 1998. Section 2. Purpose: The primary purpose of the Plan is to attract and retain personnel by permitting them to enter into agreements with the Employer that will provide for deferral of payment of a portion of current Compensation until death, disability, retirement, termination of employment, or other events as provided herein, in accordance with applicable provisions of State law, and applicable Sections of the Internal Revenue Code. Section 3. Definitions: For the purposes of this Plan when used and capitalized herein the following words and phrases shall have the meanings set forth below: 3.1 "Account" means the Participant account maintained for the purpose of recording deferred compensation, exchanges, withdrawals, and other account activity as well as any investment gains or losses allocated thereto. 3.2 "Administrator" means the organization selected by the Employer to administer the Plan. 3.3 "Beneficiary" means the person or persons, a Participant designates to receive his interest under the Plan after the Participant's death. The designation may be made, revoked and/or changed only by a written instrument signed by the Participant and filed with the Administrator prior to the Participant's death. If the Participant fails to designate a Beneficiary or if no designated Beneficiary survives the Participant, his Beneficiary shall be his spouse if he is married, or, if not, his estate. 3.4 "Code" or "IRC" means the Internal Revenue Code of 1986, as now in effect or as hereafter amended. 3.5 "Compensation" means all payments made by the Employer as remuneration for services rendered, including salaries, fees, etc. 3.6 "Deferred Compensation" means the amount of Compensation that a Participant elects to defer into the Plan under the Participation Agreement. 3.7 "Disability" means the inability of a Participant to engage in his usual occupation by reason of a medically determinable physical or mental impairment as determined by the Employer on the basis of advice from a physician or physicians. 3.8 "Eligible Rollover Account" means the separate Account maintained by the Administrator within the Plan for a Participant for amounts of Eligible Rollover Distributions. Resolution No. 2001 -1931 Page 4 3.9 "Eligible Rollover Distribution" means an eligible rollover distribution as defined in IRC Section 402(c)(4), including Eligible Rollover Distributions to a surviving spouse under IRC Section 402(c)(9). 3.10 "Eligible Retirement Plan" means an Eligible Retirement Plan as defined in IRC Section 402(c)(8)(B). 3.11 "Employee" means any officer, employee or elected official of the Employer; including all extra -help or temporary employees, who has been designated by the Employer as an Employee for participation in the Plan. 3.12 "Employer" means the City of Moorpark. 3.13 "Employer Contribution" means the contribution made by the Employer to the Plan. 3.14 "Employment Period" means a period from January 1 through December 31 of the same year, except that the first Employment Period of an Employee hired on any date other than January 1 shall be the period beginning with the date of employment and ending on December 31 of the same year. 3.15 "Includible Compensation" means, for the purposes of the limitations on deferrals, Compensation for services performed for the Employer which is currently includible in gross income after giving effect to all provisions of the IRC. The amount of Includible Compensation shall be determined without regard to any community property laws. 3.16 "Independent Contractor" means any person receiving any type of compensation from the Plan Sponsor or any of its agencies, departments, subdivisions or instrumentalities for which services are rendered pursuant to one or more written or oral contracts, if such person is not an Employee. 3.17 "Investment and Trust/Custodial Fund" means a fund established by the Employer as a convenient method of setting aside a portion of its assets to meet its obligations under the Plan. 3.18 "Normal Retirement Age" means the age specified in writing by the Participant. If the Employer has a Employer's Retirement System, the Normal Retirement Age specified by the Participant must be an age at which the Participant is eligible to retire pursuant to the Employer's basic pension plan, by virtue of age, length of service, or both, without the consent of the Employer and with the right to receive immediate retirement benefits without actuarial or similar reduction because of retirement before some later specified age. If the Employer has no Employer's basic pension plan, the Normal Retirement Age specified by the Participant must be at least age 60. In no event shall Normal Retirement Age be later than age 70'/2. 3.19 "Participant" means any Employee or Independent Contractor who is or has been eligible to defer Compensation to, and retains rights to benefits under, this Plan and who participates in this Plan by signing a Participation Agreement. 3.20 "Participation Agreement" means the agreement executed and filed by an Employee with the Administrator under which the Employee elects to become a Participant in the Plan. 3.21 "Plan" means the Employer's Deferred Compensation Plan as set forth in this document and as it may be amended from time to time. 3.22 "Plan Year" means the calendar year in which the Plan becomes effective, and each succeeding calendar year during the existence of this Plan. 3.23 "Severance From Employment" means the severance of a Participant's employment with the Employer, as defined by IRC 457(d)(1)(A), or on account of the Participant's death or retirement. An Independent Contractor shall not be considered Severed From Employment from the Employer and shall not receive any benefits under the Plan unless (i) at least 12 months have expired since the date on which the last contract, Resolution No. 2001 -1931 Page 5 pursuant to which the Independent Contractor provided any services to the Employer, was terminated, and (ii) the Independent Contractor has performed no services for the employer during the 12 month period referred to herein either as an Independent Contractor or Employee. 3.24 "Trustee /Custodian" means a bank, trust company, financial institution, or other legally authorized entity appointed by the Employer to have custody of Plan assets in the Investment and Trust/Custodial Fund. 3.25 "Unforeseeable Emergency" means severe financial hardship to the Participant resulting from a sudden and unexpected illness or accident of the Participant or a Participant's dependent (as defined in IRC Section 152(a)), loss of the Participant's property due to casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. Section 4. Participation in the Plan: 4.1 Participation. Each Employee and Independent Contractor may elect to become a Participant in the Plan and defer payment of Compensation not yet earned by executing a Participation Agreement and filing it with the Administrator at any time during active employment with the Employer. Compensation shall be deferred for any calendar month only if a Participation Agreement providing for such deferral has been entered into and is effective before the beginning of such month. 4.2 Designation of Beneficiary. The Participant shall have the right to file a Beneficiary election with the Employer designating the person or persons who shall receive the benefits payable under the Plan in the event of the Participant's death. The form for this purpose shall be provided by the Administrator and will have no effect until it is signed by the Participant and accepted by the Administrator prior to the Participant's death. If the Participant dies without electing a Beneficiary under the Plan, benefits will be paid to the Participant's estate. The Participant maintains the sole responsibility for filing a proper beneficiary election with the Administrator. 4.3 Modification of Deferral. A Participation Agreement shall remain in effect until it is terminated or modified. A Participant may modify an existing Participation Agreement to effect subsequent deferrals in accordance with rules established by the Employer. Such modification must be filed by the Participant with the Employer prior to the beginning of the month for which the modification is to be effective. 4.4 Termination of Deferral. A Participant may terminate further deferrals of Compensation under the Plan by filing with the Administrator an executed notice of termination of his Participation Agreement. Any revocations or terminations of deferrals shall be effective prospectively only. Participant Account balances shall not be payable to an Employee upon terminating deferrals under the Plan unless such Account balances would be otherwise payable to the Participant under the Plan. 4.5 Selection of Investment Options by the Participan t. The Participant shall select one or more investment options in the Investment and Trust/Custodial Fund into which the Participant's Deferred Compensation shall be allocated; provided that any amounts so allocated equal or exceed a minimum of $20.00 per pay period. The Employer shall invest, or cause to be invested, the Participant's deferrals in accordance with such selection. 4.6 Selection of Investment Options by the Beneficiary. After the death of the Participant, his Beneficiary shall have the right to amend the Participant's, or the Beneficiary's own, investment specification in the procedural manner approved by the Employer. Section 5. Amount of Deferrals: Deferral of Compensation: 5.1 Deferral of Compensation. During each Employment Period in which a Participant participates in the Plan, the Employer shall defer payment of such part of the Participant's Compensation as the Participant has specified in the Participation Agreement. Resolution No. 2001 -1931 Page 6 5.2 Employer Contribution. The Employer may contribute to the Plan for Participants. Employer contributions shall vest at the time the contributions are made and shall apply towards the maximum annual deferral limits of the Plan. 5.3 Limitation. The amount of Compensation which may be deferred by a Participant and the amount of Employer contributions, if any, made to a Participant's Account are subject to the following limitations: a. Annual Limitation. Except as provided in Paragraph (b) below, the maximum amount that a Participant may defer during an Employment Period, when added to the amount of any Employer Contribution for such Participant during the Employment Period, shall not exceed the lesser of (i) the maximum dollar amount under IRC Section 457(b)(2)(A) as adjusted for cost of living adjustments described in IRC Section 457(e)(15) or (ii) 100% of the Participant's Includible Compensation as provided in IRC Section 457(b)(2)(B). b. " +50 Catch -Up" Deferrals. The maximum deferral amount described in Paragraph (a) above and contributed under the Plan is increased for a Participant who has attained age 50 (or older) by the end of each Employment Period. The additional amount permitted to be contributed under this Paragraph is the lesser of (i) the applicable dollar amount set forth in IRC Section 414(v)(2)(B) or (ii) the Participant's Compensation for the taxable year reduced by any other elective deferrals of the Participant for the taxable year. This Paragraph shall NOT be applicable for any taxable year in which Paragraph (c) below applies. C. "Traditional Catch -Up" Deferrals. For one or more of a Participant's last three Employment Periods ending before the Participant attains Normal Retirement Age, the maximum amount a Participant may defer shall be the lesser of (i) twice the maximum deferral amount in effect under IRC Section 457(b)(2)(A) or (ii) the limitation established for the taxable year under Paragraph (a) above, plus the limitation established for purposes of Paragraph (a) for each of the prior taxable years beginning after December 31, 1978, during which the Participant was eligible to participate less the amount of Compensation deferred by or on behalf of the Participant under the Plan for each of such prior taxable years. 5.4 USERRA. Notwithstanding the preceding provisions of this Section, a Participant who is entitled to reemployment pursuant to the terms of the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) may defer an additional amount under the Plan as provided for in that Act for the years of his or her service in the uniformed services (as defined by USERRA). Any such deferral will not be subject to the limits set forth above in the year in which deferred, but will be subject to the limits for the Employment Period to which such deferrals relate. Section 6. Investment and Trust/Custodial Fund Provisions: 6.1 Investment and Trust/Custodial Fund. The Employer shall establish an Investment and Trust/Custodial Fund for the purpose of holding Plan assets for the exclusive benefit of the Plan's Participants or Beneficiaries. 6.2 Trust/Custodial Provisions. a. Trustees /Custodian. The Trustees /Custodian shall be, at any time the individual or individuals duly appointed and authorized by the Employer. b. Adoption of Investment Options. The Trustee /Custodian or the Employer shall work with the Plan Administrator to adopt various investment options for the investment of Plan assets. Additionally, the Trustee /Custodian or the Employer shall monitor and evaluate the appropriateness of those offerings by the Plan. The Trustees /Custodian or the Employer may de- select options that are determined to be no longer appropriate for offering. In the event options are de- selected, the Resolution No. 2001 -1931 Page 7 Trustees /Custodian or Employer may move, or require Participants to move, account balances to an alternative investment option offered by the Plan. By exercising such right to select investment options or by failing to respond to notice to transfer from a de- selected option, Participants and their Beneficiaries agree that no Plan fiduciaries will be liable for any investment losses or lost investment opportunity under the Plan. C. Designation of Fiduciaries. The Employer, Trustees /Custodians, and their designees are fiduciaries under the Plan. Each fiduciary has only those duties or responsibilities specifically assigned to him under the Plan or delegated to him in writing by another fiduciary. Each fiduciary may assume that any direction, information, or action of another fiduciary is proper and need not inquire into the propriety of any such action, direction or information. Except as provided by law, no fiduciary will be responsible for the malfeasance, misfeasance or nonfeasance of any other fiduciary. Fiduciary Standards. 1. The Trustees /Custodian and all other fiduciaries shall discharge their duties with respect to this Plan solely in the interest of the Participants and Beneficiaries of the Plan. Such duties shall be discharged for the exclusive purpose of providing benefits to the Participants and Beneficiaries and defraying expenses of the Plan. 2. All fiduciaries shall discharge their duties with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent person acting in like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims, and as defined by applicable State law. e. Trustees /Custodian's Powers and Duties. The Trustees /Custodian's powers and duties shall be those defined under applicable State law. Exempt Status. This Plan and Investment and Trust/Custodial Fund is intended to be exempt from taxation under Section 501(a) of the IRC and is intended to comply with Section 457(g) of the Code. The Trustees /Custodian shall be empowered to submit or designate appropriate agents to submit this Plan and Investment and Trust/Custodial Fund to the Internal Revenue Service for a determination of the eligibility of the Plan under Section 457, and the exempt status of the Investment and Trust/Custodial Fund under Section 501(a). 6.3. Investment Options. Each Participant may allocate the balances of his Account under the Plan among the investment options provided under the Plan. A Participant may change his investment options in accordance with rules established by the Employer and/or the investment providers. 6.4 Account. The Employer shall maintain an Account for each Participant to hold any Deferred Compensation or Employer Contributions, as well as any gains or losses of such funds. Each Participant's Account shall be revalued at least quarterly to reflect the earnings, gains and losses creditable thereto or debitable therefrom in accordance with the performance of the investment options selected by the Participant. The earnings, gains and losses creditable to or debitable from an Account shall mean the actual earnings, gains and losses of each investment option, on a pro -rata basis among the Accounts of those Participants who selected that investment option. Section 7. Plan Administration: 7.1 Administration. The Plan shall be maintained by the Employer, which may implement rules and regulations for the administration of the Plan consistent with its Plan. 7.2 Powers. The Employer, or its designee, shall have all powers to perform all duties necessary to exercise its functions including, but not limited to, the: Resolution No. 2001 -1931 Page 8 a. Determination of Employees' eligibility, participation, and benefits under the Plan; b. Establishment and maintenance of written records showing at any time the interest of a Participant in his Account; C. Interpretation and construction of the provisions of the Plan; d. Direction to make disbursement of benefits under the Plan; and e. Appointment of, and delegation to, such agents, advisors, counselors and delegates including an Administrator as may be necessary and appropriate for the administration and operation of this Plan. 7.3 Revocability of Administrative Action. Any action taken by the Employer with respect to the rights or benefits under the Plan of any person shall be revocable by the Employer as to payments or distributions not theretofore made pursuant to such actions and appropriate adjustments may be made in future payments or distributions to a Participant or Beneficiary to offset any excess payment or underpayment theretofore made to such Participant or Beneficiary. Section 8. Distribution of Benefits: 8.1 General Provisions. Except for Unforeseeable Emergency withdrawals under Section 8.5, and Voluntary In- Service Distribution withdrawals under Section 8.7 or otherwise specifically allowed by the Plan, distributions from the Plan may not be made to a Participant earlier than (i) the calendar year in which the Participant attains age 70` /z; or (ii) the calendar year in which there is a Severance From Employment by the Participant. All irrevocable elections of a Benefit Commencement Date by Participants or Beneficiaries made prior to January 1, 2002 and defaulted distributions (other than a defaulted distribution to an annuity option) may be voided at the election of the Participant or Beneficiary. 8.2 Mode of Payment. Benefits shall be paid in accordance with the payment option elected by a Participant. Payment amount, method of payment, and settlement options are available as provided by each of the available investment options. The Participant shall elect the mode of payment based upon the options then available. A Participant who has chosen a payment option, other than a purchased annuity payment option, shall have the ability to change his payment option, an administrative charge or restrictions may be applicable as determined by the Employer and Administrator. 8.3 Provisions Required Pursuant to Code Section 401(a)(9). Distribution of a Participant's entire Account shall commence not later than April l following the calendar year in which he attains age 70' /z or separates from service, which ever is later. Unless the form of distribution is a single lump sum payment, distributions shall be made over a period not exceeding the life expectancy of the Participant, or the joint life expectancy of the Participant and his Beneficiary. 8.4 Payments to a Beneficiary. If the Participant dies before the benefits to which he is entitled under this Plan have been paid or exhausted, then the remaining benefits payable under the Plan shall be paid to his designated Beneficiary. The Beneficiary shall have the right to elect the time and mode of payment of such benefits, subject to the limitations set forth in this Plan. Such election as to the time of payment (distribution commencement date) shall be filed by the Beneficiary not later than ninety (90) days following the Participant's death. Failure to file an election as to the form of payment may result in the Administrator making a lump sum payment to the Beneficiary. a. Death After Benefit Commencement. If the Participant dies after having begun to receive payments, the remainder of such scheduled payments shall be suspended for a period of sixty days after the Participant's death. During such suspension period, the Beneficiary may elect to receive the balance of the Participant's Account in a single lump sum or in another method of distribution, Resolution No. 2001 -1931 Page 9 provided that any elected method will distribute the remaining balance at least as rapidly as under the method of distribution used prior to the Participant's death. If no such election is made by the Beneficiary by the end of the sixty-day suspension period, the remaining Account balance shall be paid to the Beneficiary by the same payment method originally selected by the Participant. b. Death Prior to Benefit Commencement. If the Participant dies before payments have begun, payments to a Beneficiary must comply with one of the following requirements: 1. If the Participant has no Beneficiary, or the Beneficiary is not a person, such as an estate or a trust, the entire account value will be distributed within five (5) years of the Participant's death; or If the Beneficiary is not the Participant's spouse, then distribution of the Account must begin on or before December 31 of the calendar year following the Participant's death, and the entire account must be paid over a period not extending beyond the life expectancy of the Beneficiary; or If the Beneficiary is the Participant's surviving spouse, distribution of the Account may be delayed until December 31 of the calendar year in which the Participant would have attained age 70%2 at which time the entire account must then be paid over a period not extending beyond the life expectancy of the spousal Beneficiary. Interpretation: This section has been drafted in accordance with Treasury Regulations issued under Section 40 1 (a)(9) of the Code. To the extent there is a conflict between this Section and the IRC, the provisions of the IRC and applicable Treasury Regulations shall prevail. 8.5 Unforeseeable Emergency Withdrawals. Notwithstanding any other provisions of this Plan, in the event of an Unforeseeable Emergency a Participant may request that benefits be paid to him at any time. Such request shall be subject to any limitations specified by the investment carrier. Benefits to be paid shall be limited strictly to the amount necessary to meet the Unforeseeable Emergency constituting financial hardship to the extent such Unforeseeable Emergency may be relieved: a. through reimbursement or compensation by insurance or otherwise, b. by liquidation of the Participant's assets (to the extent such liquidation would not itself cause severe financial hardship), or C. by cessation or temporary suspension of deferrals under the Plan. Note: Foreseeable personal expenditures normally budgetable, such as a down payment on a home, the purchase of an automobile, college or other educational expenses, etc., will not constitute an Unforeseeable Emergency. The decision of the Employer or its designee concerning the payments of benefits under this Section shall be final. 8.6 Effect of Reemployment. If a Participant who has a Severance from Employment again becomes an Employee, no distributions shall be made or continued to the Participant while he is so employed. Any amounts which the Participant was entitled to receive on his prior Severance from Employment shall be held until the Participant is again entitled to a distribution under the terms of the Plan. 8.7 Voluntary In- Service Distributions. A Participant who is an active Employee of an eligible Employer shall receive a distribution of the total amount payable to the Participant under the Plan if the following requirements are met: a. the total amount payable to a Participant under the Plan does not exceed $5,000 (or the dollar limit under IRC Section 41 l(a)(1 1), if greater); and Resolution No. 2001 -1931 Page 10 b. the Participant has not previously received an in- service distribution of the total amount payable to the Participant under the PLAN; and C. no amount has been deferred under the Plan with respect to the Participant during the two -year period ending on the date of the in- service distribution; and d. the Participant elects to receive the distribution. Section 9: Plan Transfers and Eligible Distribution Rollovers: 9.1 Outgoing Section 457 Plan to Plan transfers through Severance of Employment. If a Participant terminates employment with the Plan Sponsor and accepts employment with another employer which maintains an eligible deferred compensation plan (as defined in IRC Section 457) and the new employer's_ plan accepts transfers, the Participant may transfer his account balance from the Plan to the plan maintained by the new employer. 9.2 Outgoing Section 457 Plan to Plan transfers while Employed. If the Employer offers an eligible deferred compensation plan (as defined in IRC Section 457) other than the Plan, and such other plan accepts transfers, the Participant may transfer the account balance from the Plan to the other plan. 9.3 lncoming Section 457 Plan to Plan Transfers. Transfers from other eligible deferred compensation plans (as defined in IRC Section 457) to the Plan will be accepted at the Participant's request if such transfers are in cash or non -annuity products currently offered under the Plan. Any such transferred amount shall not be subject to the contribution limitations of Section 5.3, provided however, that the actual amount deferred during the Employment Period under both Plans shall be taken into account in calculating the deferral limitation for that year. For purposes of determining the limitation set forth in Section 5.3, years of eligibility to participate in the prior plan and deferrals under that plan shall be taken into account. 9.4 Incoming Eligible Rollover Distributions. The Plan may receive an Eligible Rollover Distribution on behalf of a Participant from an Eligible Retirement Plan provided (a) the Eligible Rollover Distribution is made entirely in the form of U.S. dollars, and (b) the Participant demonstrates to the Administrator's satisfaction that the amount is a qualifying eligible rollover distribution under IRC Sections 402(c)(4), 403(a)(4) or 408(d)(3). 9.5 Outgoing Eligible Rollover Distributions. Subject to Section 8. 1, a Participant may elect at the time and in the manner prescribed by the Administrator, to have any portion of an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan specified by the Participant, provided the Participant presents to the satisfaction of the Administrator a letter of acceptance or other written acknowledgment from the accepting plan that it is an Eligible Retirement Plan qualified to accept the Eligible Rollover Distributions. 9.6 Purchase of Service Credits. At any time, a Participant may use all or a portion of an account balance as a direct trustee -to- trustee transfer to a Retirement System to purchase permissive service credit or for the repayment of service credits, provided that (a) the Retirement System permits such a transfer, and (b) the Participant demonstrates to the Administrator's satisfaction that the transfer is to a defined benefit governmental plan (as defined in IRC Section 414(d)) and the transfer is permissible for the purchase of service credit (as defined in Code Section 415(n)(3)(A)) or for the repayment of service credits permissible by IRC Section 415(k)(3). Section 10. Domestic Relations Orders: 10.1 Receipt of Orders. When the Employer, Administrator, Plan or Investment and Trust/Custodial Fund receives a judgment, decree or order entered or enforceable pursuant to local domestic relations or marital property law ( "Domestic Relations Order" or "DRO "), and relating to the property rights of a Participant's present or former spouse ( "Alternate Payee "), then: Resolution No. 2001 -1931 Page 11 a. The Administrator shall promptly notify the Participant and Alternate Payee of the receipt of the DRO, and b. Within a reasonable time, the Administrator will follow the procedures adopted by the Employer to determine the validity of the DRO. In the event the Administrator believes that the DRO is acceptable, it will forward the DRO to the Employer for approval. If the DRO does not appear to be acceptable, the Administrator will forward the DRO to the Employer for a final determination and instruction to reject. 10.2 Validity of a DRO. A valid DRO is a judgment, decree, order, or approval of a marital property settlement made pursuant to state domestic relations law (including community property law), relating to the property rights of a Participant and Alternate Payee. In addition, the DRO must: a. Create or recognize the existence of the right of an Alternate Payee to all or a portion of the benefits payable with respect to a Participant under the Plan; b. Clearly specify the following information: The name and last known mailing address of the Participant and Alternate Payee covered by the DRO; and The amount or percentage, or the manner in which the amount or percentage is to be determined, of the Participant's benefits to be paid to the Alternate Payee; and The number of payments or period to which the DRO applies; and 4. The plan to which such DRO applies. Provide a form of payment to the Alternate Payee that is permitted under the Plan; and d. Not require the payment of benefits to an Alternate Payee which are required by a prior DRO to be paid to another Alternate Payee. 10.3 Processing of a DRO. If it has been determined that a DRO applies to a Participant's account, upon specific instruction from the Employer, the Administrator shall comply with the DRO. The Administrator may place a restrictive hold on a Participant's account while it determines the validity of and/or processes a DRO. The Administrator shall establish a separate Account for the Alternate Payee and transfer the assigned value or benefit from the Participant's Account into the Alternate Payee's Account. 10.4 Rights of an Alternate Payee. The Alternate Payee is entitled to receive distributions immediately upon the establishment of his account under Section 10.3, and commencement of distributions must begin no later than April 15 following the year in which the Alternate Payee attains age 70' /z, in accordance with the terms of Section 8.3. Distributions made to an Alternate Payee are reported as taxable income to the Alternate Payee. State taxes, if applicable, 'and Federal taxes will be withheld from any distribution on the Alternate Payee's account based upon the tax withholding elections of the Alternate Payee. The Alternate Payee may not make any contributions to his Account but is permitted to designate beneficiaries for the Account and to exercise exchanges among the investment options as permitted by the Plan. 10.5 No Liability for Previously Distributed Amounts. If it is determined that a DRO is valid and the Participant has begun receiving distributions from the Plan, the Alternate Payee must commence distributions within sixty (60) days following the date the DRO is determined to be valid. The Administrator shall only process a DRO to the extent possible based upon the then current value or benefit in the Participant's Account. Resolution No. 2001 -1931 Page 12 Section 11. Nonassi agn bility: The interest of a Participant established under the Plan, shall not be assignable in whole or in part, directly or by operation of law or otherwise, in any manner unless specifically allowed through this document. Section 12. Miscellaneous: 12.1 No Effect on Employment. Neither the establishment of the Plan nor any modification thereof, nor the establishment of an Account, nor any agreement between the Employer, Administrator and the Trustee /Custodian, nor the payment of any benefits, shall be construed as giving to any Participant or other person any legal or equitable right against the Employer except as herein provided, and in no event shall the terms of employment of the Employee, Independent Contractor, or Participant be modified or in any way affected. 12.2 Construction. This Plan shall be construed, administered and enforced according to the Constitution, laws of the state in which the Employer resides, and the IRC. Section 13. Amendment and Termination: 13.1 Amendment and Termination. The Employer may at any time modify, amend, suspend, or terminate the Plan in whole or in part (including retroactive amendments) or cease deferring Compensation pursuant to the Plan for some or all Participants. In the event of such an action, the Employer shall deliver to each affected Participant a notice of such modification, amendment or termination or a notice that it shall cease deferring Compensation; provided, however, that the Employer shall not have the right to reduce or affect the value of any Participant's Account or any rights accrued under the Plan prior to such modification, amendment, termination or cessation. 13.2 Interpretation. This Plan is intended to be an eligible deferred compensation plan under Section 457 of the Code, and shall be interpreted and administered in a manner consistent with the IRC. The Employer reserves the right to amend the Plan to the extent that it may be necessary to conform the Plan to the requirements of Section 457 of the Code and any other applicable law, regulation or ruling, including amendments that are retroactive to the effective date of the Plan. In the event that the Plan is deemed by the Internal Revenue Service to be administered in a manner inconsistent with the Code, the Employer shall correct such administration. Section 14. Gender and Plurals: Whenever used herein, the masculine gender shall include the feminine and the singular shall include the plural unless the provisions of the Plan specifically require a different construction. Section 15: Effective Date: This Deferred Compensation Plan and Trust Custodial Document shall be effective January 1, 2002. Resolution No. 2001 -1931 Page 13 STATE OF CALIFORNIA ) COUNTY OF VENTURA ) ss. CITY OF MOORPARK ) I, Deborah S. Traffenstedt, City Clerk of the City of Moorpark, California, do hereby certify under penalty of perjury that the foregoing Resolution No. 2001 -1931 was adopted by the City Council of the City of Moorpark at a regular meeting held on the 19th day of December, 2001, and that the same was adopted by the following vote: AYES: Councilmembers Harper, Mikos and Wozniak NOES: None ABSENT: Councilmember Millhouse and Mayor Hunter ABSTAIN: None WITNESS my hand and the official seal of said City this 7 t day of February, 2002. Deborah S. Traffensted , City Clerk (seal)