What are forfeitures and how are they allocated? Definition of forfeitures. In order to reward employees who remain employed with the Employer for a long period of time, the law permits a "vesting schedule" to be applied to certain contributions that the Employer makes to the Plan. This means that you will not be entitled to ("vested" in) all of the contributions until you have been employed with the Employer for a specified period of time (see the Article in this SPD entitled "Vesting"). If a participant terminates employment before being fully vested, then the non-vested portion of the terminated participant's account balance remains in the Plan and is called a forfeiture. Forfeitures may be used by the Plan for several purposes. Allocation of forfeitures. Forfeitures will be allocated as follows:
• Forfeitures may be used to pay plan expenses or used to reduce any matching contribution. ARTICLE IV COMPENSATION AND ACCOUNT BALANCE What compensation is used to determine my Plan benefits? All Contributions
Definition of compensation. Compensation is defined as your total compensation that is subject to income tax and paid to you by the Employer. If you are a self-employed individual, your compensation will be equal to your earned income. The following describes the adjustments to compensation that apply for the contributions noted above. Adjustments to compensation. The following adjustments to compensation will be made:
• elective deferrals to this Plan and to any other plan or arrangement (such as a cafeteria plan) will be included.
• reimbursements or other expense allowances, fringe benefits, moving expenses, deferred compensation, and welfare benefits will be excluded.
• compensation paid by a related employer that is not a participating employer will be excluded.
• compensation paid after you terminate is generally excluded for Plan purposes. However, the following amounts will be included in compensation even though they are paid after you terminate employment, provided these amounts would otherwise have been considered compensation as described above and provided they are paid within 2 1/2 months after you terminate employment, or if later, the last day of the Plan Year in which you terminate employment: • compensation paid for services performed during your regular working hours, or for services outside your regular working hours (such as overtime or shift differential), or other similar payments that would have been made to you had you continued employment. Safe Harbor Matching Contributions Adjustments to compensation. The following adjustments to compensation will be made for purposes of safe harbor matching contributions: • compensation paid while not a participant in this component of the Plan will be excluded. See "Additional compensation adjustment provisions" below at the end of this question section for special provisions that may apply to compensation adjustments. Additional compensation adjustment provisions As to All Contributions, exclude ESPP waiver transactions Is there a limit on the amount of compensation which can be considered? The Plan, by law, cannot recognize annual compensation in excess of a certain dollar limit. The limit for the Plan Year beginning in 2022 is $305,000. After 2022, the dollar limit may increase for cost-of-living adjustments.
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