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Document Preview Savings and Profit Sharing Plan [Amendment No. 27] |
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Title: |
Savings and Profit Sharing Plan [Amendment No. 27] |
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Date: |
2002 |
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Preview shows 53KB of 148KB total |
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$54 |
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#292010 |
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TWENTY-SEVENTH AMENDMENT
KANSAS CITY LIFE INSURANCE COMPANY
SAVINGS AND PROFIT SHARING PLAN
THIS TWENTY-SEVENTH AMENDMENT, comprising the restated Kansas City Life Insurance Company Savings and Profit Sharing Plan, except as otherwise specifically stated in the Plan, is effective the lst day of January, 2002, and is entered into by and between Kansas City Life Insurance Company, a Corporation organized and existing under the Laws of the State of Missouri, hereinafter called the ?Company?, and John K. Koetting, Robert C. Miller and Anne C. Moberg, hereinafter referred to as the ?Trustees?.
ARTICLE I
Creation and Purpose of Trust
1.1 Name. The Company hereby creates this Plan and Trust to be known as the ?Kansas City Life Insurance Company Savings and Profit Sharing Plan? (formerly the Kansas City Life Insurance Company Savings and Investment Plan), hereinafter sometimes re-ferred to as the ?Plan? or ?Trust?.
1.2 Purpose. It is the purpose of this Plan to recognize the contributions of its employees to the successful operation of the Company and to reward such contributions by providing certain savings and investment and profit sharing benefits for those who become participants under the Plan, and for their beneficiaries.
1.3 Exclusive Benefit of Employees. This Agreement has been made, and this Plan and Trust created, for the exclusive benefit of the Company's full time employees and their beneficiaries. The terms of this Plan are intended to comply with the provisions of Sections 401(a), 501(a) and 401(k) of the Internal Revenue Code of 1986 as amended from time to time, and Treasury Department Regu-lations in connection therewith in order that the Plan and Trust may qualify for tax exemption. Under no circumstances shall any part of the principal or income of the Plan and Trust be used for, or revert to, the Company, or be used for, or diverted to, any pur-poses other than for the exclusive benefit of the employees and their beneficiaries. This Plan and Trust shall not be construed, however, as giving any employee, or any other person, any right, legal or equitable as against the Company, the Trustees, or the principal or income of the Trust, except as specifically provided for herein, nor shall it be construed as giving any employee the right to remain with the Company or in the Company?s employment.
ARTICLE II
Qualification and Eligibility
2.1 Qualification. The requirements of qualification for employees are set forth hereinafter.
| A. | Employees. Beginning February 1, 2002, each present and future employee shall be qualified to enter into a compensation reduction agreement under Paragraph 3.1 at the time specified in Paragraph 2.2 following the later of his date of hire or attaining the age of twenty-one (21) years. | |
| Each present and future employee shall be qualified to receive a matching Company contribution as specified in Paragraph 4.1 and a discretionary profit sharing contribution as specified in Paragraph 4.2 of this Plan, |
| (1) | who shall have completed one (1) year of employment with the Company during which he shall have com-pleted one thousand (1,000) hours of employment from date of hire, or if he has not completed one thousand (1,000) hours of employment within such period, then one thousand (1,000) hours of employ-ment during a calendar year beginning with the calendar year which includes the first anniversary of the employee?s date of hire, and | ||
| (2) | who shall have attained the age of twenty-one (21) years. | ||
| (3) | With respect to this Plan, an "hour of employment" shall mean: |
| (a) | Each hour for which an employee is directly or indirectly paid, or entitled to payment, by the Company for the performance of duties. These hours shall be credited to the employee for the computation period or periods in which the duties are performed; and | |||
| (b) | Each hour for which back pay, irrespective of mitigation of damages, has been either awarded or agreed to by the Company, with no duplica-tion of credit for hours under Subparagraphs (a), (b) and (c). These hours shall be credited to the employee for the computation period or periods to which the award or agreement pertains rather than the computation period in which the award, agreement or payment is made. With respect to periods described in Subparagraph (c) below, crediting of back pay hours shall be subject to the limitations set forth in that Subparagraph. | |||
| (c) | Each hour for which an employee is directly or indirectly paid, or entitled to payment, by the Company for reasons such as vacation, holidays, illness, incapacity (including disa-bility), layoff, jury duty, military leave or leave of absence in a period during which no duties are performed (irrespective of whether the employment relationship has terminated). These hours shall be credited to the employee for the computation period or periods during which the nonperformance of such duties occurs. No hour shall be credited based on any payment under a plan maintained solely to comply with applicable workers? compensation, unemployment compensation, or disability insurance laws, or which solely reimburses an employee for medical or medically-related expenses incurred by the employee. No more than five hundred one (501) hours shall be credited under this Subparagraph for any con-tinuous period during which the employee did not or would not have performed duties. Hours of service for periods of time during which no duties are performed under Subparagraphs (b) and (c) shall be calculated and credited according to Department of Labor Regulations 2530.200b-2(b) and (c). | |||
| (d) | In computing an employee?s hours of employment on a weekly or monthly basis, when a record of hours of employment is not available to determine the hours of employment under Subparagraphs (a), (b) and (c), the employee shall be assumed to have worked forty-five (45) hours for each week, or one hundred ninety (190) hours for each month (as appli-cable), for which the employee would be required to be credited with at least one (1) hour of employment under Subparagraphs (a), (b) and (c) above. | |||
| (e) | An "hour of employment" shall also include time for which an employee is absent from work either |
| (i) | by reason of the pregnancy of such employee, | ||||
| (ii) | by reason of the birth of a child of the employee, | ||||
| (iii) | by reason of the placement of a child in connection with the adoption of the child by the employee, or | ||||
| (iv) | for purposes of caring for the child during the period immediately fol-lowing the birth or placement for adoption, or | ||||
| (v) | a leave of absence covered under the Family and Medical Leave Act of 1993. |
| However, the total number of hours of such service counted for any one (1) period shall not exceed five hundred one (501) hours. |
| (4) | For the purpose of computing continuous employment, leaves of absence may be included which have been authorized by the Company for any of the following reasons: |
| (a) | Sickness. | |||
| (b) | Disability. | |||
| (c) | Service with the armed forces of the United States during any war or national emergency declared by the President or the Congress, or undeclared. | |||
| (d) | Pregnancy, not to exceed twelve (12) months. | |||
| (e) | Public service, whether elected or otherwise. | |||
| (f) | Obtaining additional education, involving periods of time not to exceed twelve (12) months for each leave of absence granted, but only after completion of one (1) full year of full time employment. |
| (5) | Such leaves of absence may be counted in computing continuous employment provided the employee returns to active employment on or before the end of such leave of absence, and when because of service in the armed forces as stated above, provided the employee returns to active employment with the Company within ninety (90) days following his discharge from such service, or such longer period during which his re-employment rights are protected by law. | ||
| (6) | Any such employee who is not qualified as a participant prior to the commencement of such a leave of absence shall not be so qualified until his return to active employment. The provisions of this Section shall be applied in a like manner to all employees under similar circumstances. |
2.2 Eligibility Date. Except as provided in the next sentence, any employee of the Company who becomes qualified after the effective date of this Agreement, shall be eligible to become a participant as of the first (1st) business day of the month coinciding with or next following the employee?s qualification, whichever first occurs. Any employee of Old American Insurance Company shall be eligible to become a participant no earlier than November 1, 1992 and in accordance with the terms of the Adoption Agreement dated December 19, 1991.
2.3 Company to Furnish Eligibility Lists. Each month, the Company shall transmit to the Committee the names of all employees and such other information concerning them as the Committee may request. The Committee shall then determine the employees who are eligible, or who will be eligible as of the first (1st) business day of each month to become participants and shall notify each such employee in writing of the existence of this Trust and of its basic provisions, and of the employee?s eligibility, and shall provide a form or application for participation, and such other forms, if any, as may be required to effect participation.
2.4 Election to Participate. Any eligible employee who desires to become a participant must execute and deliver to the Committee an application for participation on the form provided by the Committee and such other forms, if any, as may be required. In such application for participation, the employee shall agree to be bound by the terms of this Plan and Trust and of all amendments hereafter adopted with the same force and effect as if the employee had executed this Plan and Trust, and shall set forth such reason-able information as may be required by the Committee to effect participation and maintain the qualified status of this Plan and Trust.
2.5 Failure to Elect. Any employee who fails to elect to become a participant at the time of first becoming eligible, may elect to commence participation on the first (1st) business day of any succeeding month provided the employee shall then be eligible. Any employee on a leave of absence authorized by the Company, as defined in Subparagraph A(4) hereinabove, at a time when he or she could otherwise be eligible to become a participant, shall be eligible on the first (1st) business day of the first (1st) month coinciding with or next following return to active employment with the Company provided that on such date he shall meet the eligi-bility requirements.
2.6 Participation and Service on Re-employment. Subject to the provisions of this Plan, participation in the Plan by an employee shall cease upon termination of employment with the Company. Upon an employee?s termination on or after January 1, 1976, any twelve (12) month employment period during which the employee completes less than five hundred one (501) hours of employment or work due to a termination shall constitute a one (1) year break in service.
Upon the re-employment by the Company of any person whose participation has been terminated from January 1, 1976 through December 31, 1984, the following rule shall apply in determining his participation and vesting in the Plan:
| (a) | Participation - before a break in service: If the employee is rehired before he has a one (1) year break in service, he shall be eligible to participate in the plan on the first (1st) business day of the month immediately following the date of his re-employment if he shall be otherwise qualified. | |
| After a break in service: If an employee is rehired after he has a one (1) year break in service, he shall be eligible to participate in the Plan upon his completion of the requirements set forth in Paragraph 2.1 herein. | ||
| (b) | Service - for vested participants: In the case of a person who was vested when his prior period of employment terminated, any service attributable to his prior period of employment shall be reinstated as of the date of his reparticipation and he shall be vested immediately upon his reparticipation. | |
| For other persons: In the case of a re-employed employee who was not a participant in the Plan during his prior period of employment, or in the case of a participant who was not vested when his prior period of employment terminated, any service attributable to his prior period of employment shall be restored only if the number of consecutive years of his break in service was less than the aggregate number of his years of prebreak service. |
Upon the re-employment by the Company of any person who has been terminated on or after January 1, 1985, the following rules shall apply in determining his participation and vesting in the Plan:
| (a) | Participation - before a five (5) year break in service: If the employee is rehired before the number of one (1) year breaks in service equals or exceeds the greater of five (5) consecutive years of service, or the aggregate number of years of service earned before the consecutive breaks in service, he shall be eligible to participate in the Plan on the first (1st) business day of the month immediately following the date of his re-employment if he shall be otherwise qualified. This rule of parity will apply to employees who had no vested interest on separation of employment. | |
| After a five (5) year break in service: If an employee is re-hired and he does not qualify for participation or vesting under the rule in the above Paragraph, he shall be eligible to participate in the Plan upon his com-pletion of the requirements set forth in Paragraph 2.1 herein. | ||
| (b) | Service - for vested participants: In the case of a person who was fully or partially vested in his Fund III account when his prior period of employment terminated, any service attributable to his prior period of employment shall be reinstated as of the date of his re-employment and he shall participate immediately and also be vested in accordance with prior years of service. | |
| For other persons: In the case of a re-employed employee who was not a participant in the Plan during his prior period of employment, or in the case of a participant who was not vested when his prior period of employment terminated, any service attributable to his prior period of employment shall be restored unless the number of one (1) year breaks in service equals or exceeds the greater of five (5) consecutive years of service, or the aggregate number of years of service earned before the consecutive breaks in service. | ||
| Sunset Life and Old American Insurance Company: If an employee?s employment with either Kansas City Life Insurance Company, Sunset Life Insurance Company of America, Old American Insurance Company, or any other affiliated corporation of Kansas City Life Insurance Company, shall be terminated and he is subsequently employed by any other of the affiliated corporations, his employment shall be treated as if under one (1) employer for the purpose of this Plan. |
2.7 In determining whether a break in service has occurred, and not for purposes of determining a participant?s vesting service, the hours described in Paragraph 2.1A(3)(e) above shall be treated as hours of service (i) only in the year in which the absence from work begins, if a participant would be prevented from incurring a one (1) year break in service in such year solely because the period of absence is treated as hours of service as provided in Paragraph 2.1A(3)(e), or (ii) in any other case, in the immediately following year.
ARTICLE III
Member Contributions
3.1 Rate of Contribution. Commencing January 1, 1988, each participant may elect to enter into a compensation reduction agreement with the Company by which a contribution will be made for his or her respective account in an amount equivalent to one percent (1%) (commencing September 1, 1993), two percent (2%), three percent (3%), four percent (4%), five percent (5%), six percent (6%), seven percent (7%), eight percent (8%), nine percent (9%), ten percent (10%), and commencing January 1, 1998, eleven percent (11%), twelve percent (12%), thirteen percent (13%), fourteen percent (14%), or fifteen percent (15%), and commencing January 1, 2002, any percentage not to exceed one hundred percent (100%) of his unreduced monthly salary or earnings, whichever may be applicable; provided however, that no contribution in excess of five percent (5%), and, commencing January 1, 1994, six percent (6%), shall be made for any participant who shall be classified as a highly compensated person. A participant may elect to change his contribution percentage rate as of the first (1st) day of any month, but not more than once in any six (6) month period, by giving such written notice as shall be prescribed by the Committee. However, this limitation shall not apply to a change in contribution percentage rate effective January 1, 1994 made by a highly compensated person, a change in contribution percentage rate made by any participant that was effective January 1, 1998, or a change in contribution percentage rate effective January 1, 2002 made by a participant who is not a highly compensated person. The contribution for each participant shall be paid to the Trustees not less often than monthly and credited to the respective participant?s accounts. No contribution for a participant shall exceed ten thousand dollars ($10,000.00) each calendar year, subject to annual adjustments pursuant to Internal Revenue Code Sections 415(d), 402(g) and regulations. The contributions herein may sometimes be referred to as the participant?s ?elective account?.
Beginning with years after December 31, 2001, no participant shall be permitted to have elective contributions made under this Plan, or any other qualified plan maintained by the Company during any taxable year, in excess of the dollar limitation contained in Code Section 402(g) in effect for such taxable year, except for catch-up elective contributions permitted in the following paragraph and Code Section 414(v).
Beginning with contributions made after December 31, 2001, all employees who are eligible to make elective contributions under this Plan and who have attained age fifty (50) before the close of the Plan year shall be eligible to make catch-up elective contri-butions in accordance with, and subject to the limitations of, Code Section 414(v). Such catch-up elective contributions shall not be taken into account for purposes of the provisions of the Plan implementing the required limitations of Code Sections 402(g) and 415. The Plan shall not be treated as failing to satisfy the provisions of the Plan implementing the requirements of Code Sections 401(k)(3), 401(k)(11), 401(k)(12), 410(b) or 416, as applicable, by reason of the making of such catch-up elective contributions.
3.2 Salary or Compensation Defined.
| A. | For the purposes of Paragraph 3.1 herein and with respect to employees of the Company, the term ?salary? or ?compensation?, includes only the fixed amounts, hourly, weekly, semi-monthly or monthly, due and payable to the employees of the Company, not reduced by any salary reductions, but not to exceed, commencing January 1, 1994, one hundred fifty thousand dollars ($150,000.00), and, commencing January 1, 2002, two hundred thousand dollars ($200,000.00) for each calendar year, and does not include any bonuses, overtime, pay in lieu of vacation, pay while on layoff, severance pay, or other extraordinary payments by the Company. | |
| B. | The one hundred fifty thousand dollar ($150,000.00) amount shall be adjusted at the same time and in such manner as permitted under Code Sections 401(a)(17), 415(d) and regulations thereunder. The two hundred thousand dollar ($200,000.00) amount shall be adjusted at the same time and in such manner in accordance with Code Section 401(a)(17). For all other purposes of this Plan, compensation shall be defined by the provisions of Internal Revenue Code Regulation 1.415-2(d)(11)(i) and shall also include any amount not includable in the gross income of an employee under Code Sections 125, 132(f)(4), 402(e)(3), 402(h) and 403(b). | |
| C. | The family aggregation rules of Section 414(q) of the Internal Revenue Code, as modified by Section 401(a)(17), apply with respect to the requirement that the Plan must limit the amount of contributions taken into account in determining contributions. That is, the Plan must treat the following family unit as a single employee with one compensation to which the annual compensation limit under the plan applies: | |
| An employee who is either a five percent (5%) owner or is both a highly compensated employee and one of the ten (10) most highly compensated employees, such employee?s spouse, and any lineal descendants of such employee who have not attained age nineteen (19) before the close of the year. If the compensation for the family unit exceeds the annual compensation limit, then the Plan must prorate the limit among the members of the family unit in proportion to each individual?s compensation. | ||
| The family aggregation rules shall not apply effective January 1, 1997. |
3.3 Suspension of Contributions. A participant may suspend his compensation reduction agreement as of the last day of any month by giving such notice as shall be prescribed by the Com-mittee, and no contribution shall be made during such suspension period. Such suspension may last indefinitely. The participant may resume his compensation reduction agreement on the first (1st) day of any month following the expiration of six (6) months from the date his agreement was suspended, providing he shall then be eligible to participate, by giving such notice as shall be prescribed by the Committee.
3.4 Distribution Conditions. The balance in each partici-pant's elective account shall be fully vested at all times and shall not be subject to forfeiture for any reason. Amounts held in the participant's elective account may not be distributable prior to the earlier of,
| (1) | his retirement, termination of employment or death; | |
| (2) | his attainment of age fifty-nine and one-half (59 1/2); | |
| (3) | termination of the Plan without establishment of a successor Plan by the Company or an affiliated employer; | |
| (4) | the date of the sale by the Company to an entity that is not an affiliated employer of substantially all the assets, within the meaning of Code Section 409(d)(2), with respect to a participant who continues employment with the corporation acquiring such assets; | |
| (5) | the date of the sale by the Company or an affiliated employer of its interest in a subsidiary to an entity which is not an affiliated employer with respect to a participant who continues employment with such sub-sidiary; or | |
| (6) | proven financial hardship, subject to the limitations of Section 3.5. |
For distributions occurring after December 31, 2001, a participant?s elective contributions and earnings attributable to those contributions shall be distributed on account of the parti-cipant?s severance of employment. However, such a distribution shall be subject to the other provisions of the Plan regarding distributions, other than provisions of the Plan that require a separation from service before such amounts may be distributed.
In the event that the dollar limitation provided for in Para-graph 3.1 is exceeded, the Administrative Committee shall direct the Trustees to distribute such excess amount, and any income allocable to such amount, to the participant not later than April 15th following the close of the participant?s taxable year. If there is a loss allocable to such excess amount, the distribution shall in no event be less than the lesser of the participant?s elective account or the amount of the contribution made for such participant?s elective account in the calendar year resulting from his salary reduction agreement.
In the event that a participant is also a participant in another qualified cash or deferred arrangement as defined in Code Section 401(k), a simplified employee pension plan as defined in Code Section 408(k), or a salary reduction arrangement within the meaning of Code Section 3121(a)(5)(d), and the elective deferrals, as defined in Code Section 402(g)(3), made under such other arrangements and this Plan cumulatively exceed ten thousand dollars ($10,000.00) or such amount adjusted annually as provided in Code Section 415(d) and regulations for such participant?s taxable year, the participant may, not later than March 1st following the close of his taxable year, notify the Administrative Committee in writing of such excess and request that his deferred compensation to this Plan be reduced by an amount specified by the participant. Such amount shall then be distributed in the same manner as provided in the previous Paragraph.
3.5 Withdrawal, Extreme Financial Necessity. The Adminis-trative Committee, in its sole discretion, may direct the Trustees to distribute to any participant or his beneficiary up to one hundred percent (100%) of the participant?s elective account, valued as of the most recent valuation date, in the case of proven extreme financial necessity. Commencing January 1, 1988, such distribution shall be limited solely to the participant?s deferred compensation without regard to any earnings on such deferred com-pensation. Withdrawal under this section shall only be authorized in the event of financial hardship resulting from accident to or sickness of a participant or his dependents; or financial hardship resulting from the establishing or preserving of the home in which the participant resides, provided funds are not reasonably available from other financial resources to the participant. Furthermore, any withdrawal pursuant to the provisions of this section shall be governed by the provisions of ARTICLE IX herein regarding suspension of participation and forfeitures, except that the period of suspension shall be twelve (12) months, and the Administrative Committee?s determination with respect to any question herein shall be final. However, a participant who receives a distribution from his elective account after December 31, 2001 on account of hardship shall be prohibited from making contributions to his elective account for six (6) months after receipt of the distribution. A participant who receives a distribution from his elective account in calendar year 2001 on account of hardship shall be prohibited from making contributions to his elective account for six (6) months after receipt of the distribution or until January 1, 2002, if later. Withdrawals pursuant to this Paragraph may not be made by an individual who is an alternate payee under a Qualified Domestic Relations Order and for whom an account is being separately maintained, nor shall withdrawals pursuant to this Paragraph be made by a former employee who was a participant and who has not withdrawn all the value of his elective account pursuant to Paragraph 10.4.
The Company and the Administrative Committee shall adopt procedures necessary to implement the compensation reduction elections provided for herein.
3.6 Compensation Reduction Limitations. To insure continued qualification of the Plan, a test sometimes referred to as the ?actual deferral percentage test? must be met for each Plan year. In order to meet the ADP test, it may be necessary to adjust contributions made by the Company resulting from the compensation reduction agreements entered into by certain of the participants.
In the event that the contribution ratios of the Plan do not satisfy the test, the Administrative Committee shall adjust the contributions resulting from the compensation reduction agreements as follows effective January 1, 1997:
| (a) | Any distribution under this Paragraph shall be made on or before the fifteenth (15th) day of the third (3rd) month following the end of the Plan year, but in no event later than the close of the following Plan year, which in this case is a calendar year, and shall be determined in the following manner: |
| (i) | The dollar amount of excess contributions for each highly compensated participant shall be calculated. | ||
| (ii) | The total of the dollar amounts in (i) shall be determined. | ||
| (iii) | The contributions resulting from the com-pensation reduction agreement (?elective contributions?) of the highly compensated participant with the highest dollar amount of elective contributions shall be reduced by the amount required to cause that highly com-pensated participant?s elective contributions to equal the dollar amount of the elective contributions of the highly compensated participant with the next highest dollar amount of elective contributions. This amount shall be distributed to the highly compensated participant with the highest dollar amount. However, if a lesser reduction, when added to the dollar amount already distributed under this (iii) would equal the total excess contributions, the lesser reduction amount shall be distributed. | ||
| (iv) | If the total amount distributed is less than the total excess contributions, reductions shall continue to be made in accordance with (iii) until the total amount distributed equals the total excess contributions. |
| (b) | For purposes of this Paragraph, income means the gain or loss allocable to excess contributions which shall equal the sum of the allocable gain or loss for the Plan year and the allocable gain or loss for the period between the end of the Plan year and the date of distribution (gap period). The income or loss allocable for the Plan year and the gap period is calculated separately and is determined by multiplying the income or loss for the Plan year and gap period by a fraction. The numerator of the fraction is the excess contributions made by the employee for the Plan year, and the denominator is the total account balance of the employee attributable to elective contributions as of the end of the Plan year, reduced by the gain allocable to such total amount for the Plan year and increased by the loss allocable to such total amount for the Plan year. The income allocable to excess contributions for the period between the end of the Plan year and the date of distribution shall be calculated in the same manner by substituting ?gap period? for ?Plan year? in the fraction. |
3.7 Deferral Percentage Test.
| (a) | Maximum annual allocation: Effective January 1, 1997, the actual deferral percentage for eligible highly compensated employees for the Plan year bears a relationship to the actual deferral percentage for all other eligible employees for the preceding Plan year which meets either of the following tests: |
| 1. | The actual deferral percentage for the highly compensated participant group shall not be more than the actual deferral percentage of the nonhighly compensated participant group multiplied by 1.25, or | ||
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