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HomeMy WebLinkAboutCC Res 3644 1986-10-13 RESOLUTION NUMBER g/'tlJ./ A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEAL BEACH, CALIFORNIA, ESTABLISHING A DEFERRED COMPENSATION PLAN FOR MANAGEMENT/ MID-MANAGEMENT EMPLOYEES WHEREAS, the City of Seal Beach has employees rendering valuable servicesj and WHEREAS, the establishment of a deferred compensation plan for such employees will serve the interests of the City of Seal Beach by enabling it to provide reasonable retirement security for its employees, by providing increased flexibility in its personnel management system and by assisting in the attraction and retention of competent personnelj and WHEREAS, the City of Seal Beach has determined that the establishment of a deferred compensation plan to be administered by the ICMA Retirement Corporation will service the above objectivesj and WHEREAS, the City of Seal Beach desires that the investment of funds held under its deferred compensation plan be administered by the ICMA Retirement Corporation, as Trustee, with the understanding that such funds will be held by the ICMA Retirement Trust, a trust established by public employers for the purpose of representing the interests of such employers with respect to the collective investment of funds held under their deferred compensation plan. NOW, THEREFORE, BE IT RESOLVED that the City of Seal Beach adopts the deferred compensation plan, attached hereto as Appendix A, and appoints the ICMA Retirement Corporation to serve as Administrator thereunderj and BE IT FURTHER RESOLVED that the City of Seal Beach hereby executes the ICMA Retirement Trust, attached hereto as Appendix Bj and BE IT FURTHER RESOLVED that the City of Seal Beach hereby adopts the trust agreement, attached hereto as Appendix C and appoints the ICMA Retirement Corporation as Trustee thereunder, and directs the ICMA Retirement Corporation, as Trustee, to invest all funds held under the deferred compensation plan through the ICMA Retirement Trust as soon as is practicablej and BE IT FURTHER RESOLVED that the City Manager shall be the coordinator for this program and shall receive necessary reports, notices, etc. from the ICMA Retirement Corporation as Administrator, and shall cast, on behalf of the City of Seal Beach, any required votes under the program. Administrative duties to carry out the plan may be assigned to the appropriate departments. APPROVED AND ADOPTED BY THE City Counci}~ the h, at a meeting thereof held on the ~ d , 1986, by th follow g vote: City of of AYES: Councilmembers NOES: Councilmembers ABSENT: CouncUmembers .~ t:~ Mayor I I I ~ Resolution Number..164-s/ I STATE OF CALIFORNIA COUNTY OF ORANGE CITY OF SEAL BEACH ) ) SS ) I, Joanne, M. Yeo, City Clerk of Seal Beach, California, do hereby certify that the f~gOing resolution is the original copy of Resolution Number .!JI.i/. on file in the office of the City Clerk, passed, ap~roved and adopted by the City Council of the C~~~f Seal Bea~at ~r meeting thereof held on the ~ - day of .1:1'1 , 1986. I I . Resolution Number ~~~~ APPENDIX A ("EMPLOYER") DEFERRED COMPENSATION PLAN I I. INTRODUCTION The Employer hereby establishes the Employer's Deferred Compensation Plan, hereinafter referred to as the "Plan." The Plan consists of the provISions set forth In this document. The primary purpose of this Plan is to provide retirement income and other deferred benefits to the Employee. of the Employer in accordance with the provisions of section 457 of the Internal Revenue Code of 1954, as amended. Th I. Plan shall be an agreement solely between the Employer and participating Employees. II, DEFINITIONS 2,01 Account The bookkeeping account maintained for each Participant reflecting the cumulative amount of the Participant's Deferred Compensation. including any Income, gains. losses. or increases or decreases In market value attributable to the Employer's investment of the Participant's Defarred Compen.ation, and further reflecting any distribu- tions to the Participant or the Participant'. Beneficiary and any fees or expenses charged against such Participant's Deferred Compensation. 2.02 Admlnlltrator: The person or persons named to carry out certain nondiscretionary admimstratlve functions under the Plan, as hereinafter deSCribed. The Employer may remove any person as Administrator upon 60 days advance notice In writing to such person, in which case the Employer shall name another person or persons to act as Administrator. The Administrator may resign upon 60 days advance notice in writing to the Employer, in which the case the Employer shall name another person or persons to act as Administrator. 2,03 Beneflele,,: The person or persons de.ignated by the Participant in his JOinder Agreement who shall receive any benefits payable hereunder In the event of the Participant'. death. ~-I 2.04 Dehtrrad Comp....atlon: The amount of Normal Compensa- tion otherwise payable to the Participant which the Participant and the Employer mutually agree to defer hereunder, any amount credited to a Participant's Account by reason of a transfer under Section 6.03, or any other amount which the Employer agrees to credit to a Participant'. Account. 2.05 Employee: Any indiVidual who prOVides services for the Employer, whether as an employee of the Employer or as an independent contractor. and who has been designated by the Employer as eligible to participate in the Plan. 2.0S Inoludble CompensaUon: The amount 01 an Employee'. compensation from the Employer for a taxable year that is attributable to services performed for the Employer and that Is Includible in the Employee's gross income for the taxable year for federal income tax purposes: such term does not Include any amount excludable from gross Income under thiS Plan or any other plan de.crlbed In .ectlon 457(b) of the Internal Revenue Code, any amount excludable from gross Income under section 403(b) of the Internal Revenue Code, or any other amount excludable from gross income for federal Income tax purposes. Includible Compensation shall be determined without regard to any community property laws. 2.07 Joinder Agreement: An agreement entered Into between an Employee and the Employer, including any amendments or modifications thereof. Such agreement shall fix the amount of Deferred Compensation, Specify a preference among the investment alternatives designated by the Employer, designate the Employee's BenefiCiary or Beneficiaries, and Incorporate the terms, conditions, and provisions of the Plan by reference. 2.08 Norma. Compen.atlon: The amount of compensation whICh would be payable to a Participant by the Employer for a taxable year If no JOinder Agreement were In effect to defer compensation under thiS Plan. 2.09 Normal Rellram...t Age: Age 70, unles. the Participant ha. elected an alternate Normal Retirement Age by written Instrument delivered to the Administrator prior to Separation from Service. A Participant's Normal Retirement Age determInes (a) the lat..ttima when benefits may commence under thiS Plan (unless the Participant contlOues employ- ment aller Normal Retirement Age), and (b) the period during which a PartiCipant may utilize the catch-up limitation of Section 5.02 hereunder Once a Participant has to any extent utilized the catch-up limitation of Section 5.02, his Normal Retirament Age may not be changed. A Participant's alternate Normal Retirement Age may not be earlier than the earhest date that the Participant will become eligible to retire and receive unreduced retirement benefits under the Employefs basic retirement plan covering the Participant and may not be later than the date the Participant aUBlns age 70. \f a Participant contlOues employment after attainlOg age 70, not haVIng preViously elected an alternate Normal RetlrementAge, the Participant's alternate Normal Retirement Age shall not be later than the mandatory retirement age, If any, established by the Employer, or the age at which the Participant actually separates from service if the Employer has no mandatory retirement 8ge. If the Participant will not become eligible to receive benefits under 8 basic retirement pl8n maintained by the Employer, the Participant's alternate Normal Retirement Age may not be earlier than attainment of age 55 and may not be later than attainment of age 70. 2.10 Partloip..t: Any Employee who has jOined the Plan pursuant to the requirements of Article IV. 2.11 Plan Year: The calendar year. I I 1 Resolution Number X4'~ I 2.12 Rellremont: The lirst dete upon which both olthelollowlng shall have occurred with respect to a Participant: Separation from Service and attainment of Normal Retirement Age. 2.13 Seperllllon Irom Service: Severenee 01 the Porticipent's employment wllh the Employer. A Participant shall be deemed to have severed his employment with the Employer for purposes of this Plan when. in accordance with the established practices 01 the Employer, the employment relationship is considered to have actually terminated In the case of a Participant who IS an Independent contractor of the Employer. Separation from Service shall be deemed to have occurred when the Participant's contract under which services are performed has completely expired and terminated, there 15 no foreseeable possibility that the Employer will renew the contract or enter Into 8 new contract for the Participant's services, and It is not anticipated that the Participant will become an Employee of the Employer. III. ADMINISTRATIDN 3,01 Dutln 01 Employer: The Employer shall hevethe authority to make all discretionary deCisions affecting the rights or benefits of Participants which may be required In the administration of this Plan. 3,02 Dulin 01 Admlnlslrelor: The Adm,n,strator, ss agent lor the Employer, shalJ perform nondiscretionary administrative functions in connection with the Plan. Including the maintenance of Participants' Accounts. the prOVision of periodic reports of the status of each Account and the disbursement of benefits on behalf of the Employer in accordance with the prOVisions of this Plan I IV. PARTICIPATIDN IN THE PLAN 4,01 Inlllel Pertlclpllllon: An Employee may become a Participant by enterang into a Joinder Agreement prior to the beginning of the calendar month In whIch the Joinder Agreement IS to become effective to defer compensation not yet earned 4.02 Amendment of Joinder Agreement: A PartiCipant may amend an executed JOinder Agreement to change the amount of compensation not yet earned which IS to be deferred (Including the reduction of such future deferrals to zero) orto change hiS Investment preference (subject to such restrac- tlons as may result from the nature or terms of any Investment made by the Employer). Such amendment shall become effective as of the beginning of the calendar month commencing after the date the amendment IS executed A Participant may at any time amend hiS JOInder Agreement to change the designated Beneficiary and such amendment shall become effective Immediately. V, LIMITATIONS ON DEFERRALS 5.01 Normal Umitltion: Except as provided in Section 5.02, the maximum amount of Deferred Compensation for any Participant for any taxable year shall not exceed the lesser of $7,500 00 or 33 1/3 pereent of the Participant's Includ'ble Compensation for the taxable year ThiS limitation will ordinarily be eqUivalent to the lesser of $7.500.00 or 25 percent of the Participant's Normal Compensation. 5.02 Cetch.up L1mltllllon: For each of the lastth,.e (3) Iaxable years of a Participant ending before his attainment of Normal Retirement Age, the maximum amount of Deferred Compensation shall be the lesser 01: (1) $15,000 or (2) the sum of (i) the Normal Limitation for the taxable year. and (i1) that portion of the Normal LimitatIon for each of the prior taxable years of the Participant commenCing after 1978 during which the Plan was in eXistence and the PartiCipant was eligible to parttcipate In the Plan (or in any other plan established under section 457 of the Internal Revenue Code by an employer within the samp. State as the Employer) less the amount of Deferred Compensation for each such prior taxable year (including amounts deferred under such other I plan). For purposes of this Section 5.02. a PartiCIpant's Includible Compensation for the current taxable year shall be deemed to include any Deferred Compensation for the taxable year In excess of the amount permitted under the Normal Limitation, and the Participant's Includible Compen~ sahon for any prior taxable year shall be deemed to exclude any amount that could have been deferred under the Normal limitation for such prior taxable year. 5.03 Seellon 403(b) Annullles: For purposes of Sections 5.01 end 5.02, emounts contributed by the Employer on behalf of a Participant for the purchase of an annuity contract described in section 403(b) 01 the Internal Revenua Code shall be treated as if such amounts constituted Deferred Compensa- tion under this Plan for the taxable year in which the contribution was made and shall thereby reduce the maximum amount that may be deferred for such taxable year. VI, INVESTMENTS AND ACCOUNT VALUES S.01 Invntmont 01 Deferred Camponletlon: All investments 01 Portlclpants' Delerred Compensation mede by the Employer, including all property and rights purchased With such amounts and all income attrabutable thereto. shall be the sole property of the Employer and shall not be held in trust for Participants or as collateral security for the fulfillment of the Employer's obligations under the Plan Such property shall be subject to the claims of general creditors of the Employer, and no PartiCIpant or BenefiCiary shall have any vested Interest or secured or preferred pOSlllon With respect to such property or have any claim against the Employer except as a general creditor. S,02 Crediting 01 Accountl: The Participant's Account shall rellect the amount and value of the investments or other property obtained by the Employer through the 'nvestment 01 the PartiCipant's Deferred Compensation It is anticipated that the Employer's investments With respect to a Participant Will conform to the Investment preference specified in the PartiCipant's Joinder Agreement, but nothing herein shall be construed to require the Employer to make any particular Investment of a Participant's Deferred Compensation. Each Participant shall receive periodic reports, not less frequently than Innually, showing the then-current value of hiS Account 6.03 Acceptance of Tranlfen: Pursuant to an appropraate wratten agreement. the Employer may accept and credit to a PartIcipant's Account amounts transferred from another employer Within the same State representing amou nts held by such other employer under an eligible State deferred compensation plan descrabed In section 457 of the Internal Revenue Code Any such transferred amount shall not be treated as a deferral subject to the Ilmltallons of Article V, prOVided however, that the actual amount of any deferral under the plan from which the transfer IS made shall betaken Into account In compullng the catCh-up limitation under Sect,on 5.02 S,D4 Employer Lleblllly: In no event shall the Employer'S liability to pay benefits to a Participant under Article VI exceed the value of the amounts credited to the Partlclpanrs Account, the Employer shall not be liable for losses arising from depreCiation or shrinkage in the value of any investments acquired under thiS Plan. VII. BENEFITS 7.01 Rellrement Benellll ..d Elecllon on Seperetion Irom Service: Except as otherWise provided In thiS Article VII, the distribution of a PartiCipant's Account shall commence during the second calendar month after the close of the Plan Year of the Participant's Retirement, and the dlstnbutlon of such Retirement benefits shall be made In accordance with one of the payment options described In Section 7.02 NotWithstanding the foregOing. the PartiCipant may Irrevo- 2 .. f. Resolution Number .36# cably elect within 60 days following Separation from ServIce to have the distnbution of benefits commence on a date other than that described In the preceding sentence which IS at least 60 days after the date such election IS delivered In writing to the Employer and forwarded to the Administrator but not later than 60 days aller the close 01 the Plan Year 01 the Participant's Retirement. 7.02 Payment OpUons: As provided In Sections 7 01, 7.05 and 7.OS, a Participant may elect to have the value of his Account distributed In accordance with one of the following payment options. provided that such option is consistent with the limitations set forth in Section 7 03: (a) Equal monthly, quarterly, semi-annual or annual payments In an amount chosell by the Participant. continuing until hiS Account IS exhausted: (b) One lump sum payment; (c) Approximately equal monthly, quarterly, semi-annual or annual payments. calculated to continue for a period certain chosen by the Participant; Cd) Payments equaJ to payments made by the issuer of a retirement annuity policy acquired by the Employer. (e) Any other payment optIon elected by the Part'clpant and agreed to by the Employer A Participant's election of a payment option must be made at least 30 days before the payment of benefits is to commence. If a Participant fails to make a timely election of a payment optIon, benefits shall be paid monthly under option (e) above for a period of five years. 7,03 Limitation on Options: No payment option may be selected by the Participant under Section 7 02 unless the present value of the payments to the ParticIpant, determined as of the date benefits commence, exceeds 50 percent of the value of the Participant's Account as of the date benefits commence. Present value determinations under this Section shall be made by the Administrator In accordance with the expected return multiples set forth in section 1 72-9 of the Federal Income Tax Regulations (or any successor provision to such regulations). 7,04 Poot.retirement Death Benolita: Should the Part,cipant dIe after he has begun to receive benefits under a payment option, the remaining payments, It any, under the payment option shall be payable to the PartICipant's BenefiCiary commencing wIthin 60 days after the Administrator receives proof of the Partlclpant's death, unless the Beneficiary elects payment under a different payment option at least 30 days pnor to the date that the first payment becomes payable to the Beneficiary. In no event shall the Employer or Administrator be liable to the Beneficiary for the amount of any payment made in the name of the Participant before the Administrator receives proof of death of the Participant. NotWithstanding the foregOing, payments to a BenefiCiary shall not extend over a penod longer than (I) the Beneficiary's life expectancy If the Beneficiary IS the PartICipant's spouse or (II) fifteen (15) years If the Beneficiary is not the Participant's spouse. If no BenefiCiary IS designated In the JOinder Agreement. or If the designated BenefiCiary does not survive the Participant for a penod of fifteen (15) days. then the commuted value of any remaining payments under the payment option shall be paid in a lump sum to the estate of the Participant. If the deSignated Beneficiary survives the Participant for a penod of fifteen (15) days. but does not continue to live for the remaining penod of payments under the payment option (as modified. if necessary, in conformity With the third sentence of this section), then the commuted value of any remaining payments under the payment option shall be paid in a lump sum to the estate of the Beneficiary. 7.05 Pr..retlrement Death Benefitl: Should the Participant die before he has begun to receive the benefits provided by Sections 7.01 or 7.OS, a death benefit equal to the valueoflhe Participant's Account shall be payable to the Beneficiary commencing no later than 60 days after the close of the Plan Year In which the PartiCipant would have attained Normal Retirement Age. Such death benefit shall be paId In alump sum unless the Beneficiary elects a different payment option wlth,n 90 days 01 tile Participant's death. A Benellciary who may elect a payment option pursuant to the provisions of the preceding sentence shall be treated as if he were a PartiCipant for purposes of determining the payment options available under Section 7.02: proVided, however, that the payment option chosen by the Beneficiary must provide for payments I to the BenefiCiary over a period no longer than the life expectancy of the Beneficiary if the Beneficiary IS the PartiCipant's spouse and must provide for payments over a period not in excess ollilleen (15) years ilthe Benel,clary is not the PartiCipant's spouse. 7,OS Disability: In the event a Participant becomes disabled belore the commencement of Retirement benefits under Section 7.01, the Participant may elect to commence benefits under one of the payment options deSCribed In SectloD 7.02 on the last day of the month follOWing a determination of disability by the Employer. The Participant's request for such determination must be made Within a reasonable time after the impairment which constitutes the disability occurs. A Participant shall be considered disabled for purposes of thiS Plan If he is unable to engage In any substantial gainful activity by reason of any medically determinable phYSical or mental impairment which can be expected to result in death or be of long--continued and indefinite duration. The disability of any Participant shall be determined In accordance With uOIform prinCiples consistently applied and upon the basis of such medical evidence"8s the Employer deems necessary and desirable. 7.07 Unfor.....bl. Emergenci..: In the event an unforeseeable emergency occurs, a Participant may apply to the Employer to receive that part of the value of hiS account that IS reasonably needed to satisfy the emergency need If such an application is approved by the Employer, the PartiCipant shall be paid only such amount as the Employer deems necessary to meet the emergency need, but payment shall not be made to the extent that the finanCial hardship may be relieved through cessation of deferral under the Plan. Insurance or I other reimbursement, or hquidation of other assets to the extent such liqUidatIon would not Itself cause severe financial hardship. An unforeseeable emergency shall be deemed to InVOlve only circumstances of severe finanCial hardship to the Participant resultrng from a sudden and unexpected Illness or aCCident of the PartiCipant or of a dependent (as defined in section 152(a) of the Internal Revenue Code) of the Participant, loss of the Participant's property due to casualty, or other Similar and extraordinary unforeseeable circum- stances anslng as a result of events beyond the control of the PartiCipant The need to send a Participant's child to college or to purchase a new home shall not be conSidered unforeseeable emergencies The determination as to whether such an unforeseeable emergency eXists shall be based on the ments of each IndiVidual CBse VIII, NON-ASSIGNABILITY No PartiCipant or Beneficiary shall have any nght to commute, sell. assign. pledge. transfer or otherwise convey or encumber the right to receive any payments hereunder, which payments and nghts are expressly declared to be non-ass1gnab'e and non- transferable. IX. RELATIONSHIP TO OTHER PLANS ANO EMPLOYMENT AGREEMENTS 3 ThiS Plan serves in addition 10 any other retirement, penSion. or benefit plan or system presently In eXistence or hereinafter established for the benefit of the Employer's employees. and participatIon hereunder shall not sffect benefits rece,vable under I Resolution Number~~~ any such plan or system. Nothing contained 10 this Plan shall be deemed to constitute an employment contract or agreement between any PartIcIpant and the Employer or to give any Participant the right 10 be retained In the employ of the Employer. Nor shall anything herein be construed to modify the terms of any employment contract or agreement between a Participant and the Employer. I X. AMENDMENT OR TERMINATION OF PLAN The Employer may at any time amend this Plan provided that it transmits such amendment 10 writing to the Admu)lstrator at least 30 days pnor to the effective date of the amendment The consent of the Administrator shall not be reqUired In order for such amendment to become effecllve. but the Administrator shall be under no obligation tocontlOuBacting as Administrator hereunder If it disapproves of such amendment The Employer may at any time terminate thiS Plan The Administrator may at any time propose an amendment to the Plan by an instrument In writtng transmitted to the Employer at least 30 days before the effective date of the amendment. Such amendment shall become effectIVe unless. within such 30.day I I penod. the Employer notifies the AdmlOlstrator In wnting that it disapproves such amendment. in which case suCh amendment shall not become effective. In the event of such disapproval. the Adminrstrator shall be under no obligation to continue acting as Admimstrator hereunder. No amendment or termination of the Plan shall divest any Participant of any nghts with respect to compensation deferred before the date of the amendment or termination XI. APPLICABLE LAW This Plan shall be construed under the laws of the state where the Employer is located and is established with the mtent that It meet the requirements of an "ellgibleStatedeferredcompensatlon plan" undar aeclion 457 of the Interna' Revenue Code of 1954. as amended. The provIsions of thiS Plan shall be Interpreted wherever possible 10 conformity with the requirements of that section XII. GENDER AND NUMBER The masculine pronoun, whenever used herein. shall include the feminine pronoun, and the singular shall Include the plural, except where the context requires otherwise 4 Resolution Number .tStJI APPENDIX B DECLARATION OF TRUST of ICMA RETIREMENT TRUST ARTICLE I. NlIme and Dellnltlon. SECTION 1 1. Name The Name of the Trust creeted hereby is the leMA Retirement Trust. SECTION 1 2. DefInItIons. Wherever they are used herein. the follOWing terms shall have the follOWing respective meanings. (a) By-Laws The By-Laws relerred to in Section 4.1 hereol. as amended from time to time. (b) Deferred CompensatIOn Plan. A deferred compensation plan established and maintained by a Public Employerfor the purpose of providing retirement Income and other deferred benefits to its employees In accordance with the proviSions of section 457 of the Internal Revenue Code of 1954. as amended. (e) Guaranteed Investment Contract. A contract entered into by the Retirement Trust with insurance companies that provides for a guaranteed rate of return on investments made pursuant to such contract. (d) ICMA The International City Management ASSOCIatIon. (e) ICMA/RC Trustees. Those Trustees elected by the Public Employers who. In accordance with the prOVISions of Section 3 l(a) hereof. are also members olthe Board of Directors of ICMA orRC. (f) Investment Adviser. The Investment Adviser that enters Into a contract with the Retirement Trust to provide adVice with respect to investment of the Trust Property (g) Employer Trust. A trust created pursuant to an agreement between RC and a Public Emptoyer for the purpose of investing and administering the funds set aside by such employer In connection With its deferred compensation agreements with Its employees. (h) PortfoliOS. The Porllollos ollnveatments established by the Investment Adviser to the Retirement Trust. under the superviSion of the Trustees. for the purpose of providing Investments for the Trust Property (.) PubliC Employee Trustees. Those Trustees elected by the Public Employers who. In accordance With the provisions of Section 3.1(8) hereof. are full-time employees of Public Employers. (J) PubliC Employer. A unit of state or local government, or any agency or instrumentality thereof. that has adopted a Deferred Compensation Plan and has executed thiS Declaration of Trust. (k) Re. The International City Management ASSOCiation Retirement Corporation. (I) Retirement Trust. The Trust created by thiS Declaration of Trust. (m) Trust Property. The amounts held," theRetlrementTrust on behalf of the Public Employers. The Trust Property shall include any Income resulling from the IOvestment of the amounts so held. (n) Trustees The Public Employee Trustees 8l1d ICMA/RC Trustees elected by the Public Employers to serve as members 01 the Board.of Trustees of the Relirement Trust I ARTICLE II. Creation and Purpooe 01 tM Tru.t; Ow.....hlp 01 Tru.t Property SECTION 2.1. Creation The Retirement Trust Is created 8l1d eS1ablished by the execution 01 this Declaration 01 Trust by the Trusteee and the participating Public Employers. SECTION 2.2. Purpose The purpose of the Retirement Trust IS to provide for the commingled Investment ot funds held by the Public Employers in connection with their Deferred Compensation Plans. The Trust Property shall be invested 10 the Portfolios. in Guaranteed Investment Contracts and In other Investments recommended by the Investment Adviser under the supervision of the Board at Trustees. SECTION 2.3 OwnershIp of Trust Property. The Trustees shall have legal tItle to the Trust Property. The Public Employers shall be the benefiCial owners of the Trust Property. ARTICLE III. Tru.teee SECTION 3.1. Number and QualificatIon 01 Trustees. (a) The Board of Trustees shall consist of nine Trustees. Five of the Trustees shall be lull-t.me employees 01 a PublIC Employer (the Public Employee Trustees) whO are authorized by such Public Employer to serve as Trustee. The remaming four Trustees shall consist of two persons who, at the time at election to the Board of Trustees. are members of the Board of Directors of ICMA and two persons who. at the time of election. are members of the Board of Directors of RC (the ICMA/RC Trustees) One of I the Trustees who IS a director of leMA. and one of tne Trustees who is a director of RC. shall. at the time of election. be full.tlme employees 01 a Public Employer (b) No person may serve as a Trustee for more than one term In any ten.year period SECTION 3 2. Elecllon and Term (a) Except for the Trustees appointed to fill vacancies pursuant to SectIon 35 hereof. the Trustees shall be elected by a vote 01 a majority of the PubliC Employers In accordance With the procedures set forth In the By-Laws. (b) At the frrst election of Trustees. three Trustees shall be elected for a term of three years. three Trustees shall be elected tor a term of two years and three Trustees shall be elected for a term of one year. At each subsequent election. three Trustees shall be elected for a term of three years and until hiS or her successor IS elected and qualified. SeCTION 3.3. Nominations The Trustees who are full-time employees of Public Employers shall serve as the Nominating Committee for the Public Employee Trustees. The Nomlnatmg Committee shall choose candidates for Public Employee Trustees. In accordance With the procedures set forth In the By-Laws. SECTION 3.4 ReSignation and Removal (a) Any Trustee may resign as Trustee (Without need for prior or subsequent accounting) by an Instrument In wrltmg signed by the Truslee and delivered 10 Ihe other Trustees and such resignallon shall be effecllVe upon such delivery. or at a laler dateaccordmg I R~_s~l uti~~ _~umb':.r$d to the terms of the Instrument. Any of the Trustees may be removed for cause, by 8 vote 0' a majOrity of the Public Employers. (b) Each Public Employee Trustee shall resign his or her position as Trustee within sixty days of the date on which he or she ceases to be a tull-tlme employee of 8 Public Employer SECTION 3.5 VacancIes. The lerm 01 office 01 a Trustee shall terminate and 8 vacancy shall occur in the event of the death. resignation, removal. adJudicated incompetence or other incapacity to perform the duties of the office a' a Trustee In the case of a vacancy, the remaining Trustees shall appoint such person as they In their discretion I shall see fit (subJect to the limitations set forth 10 this Section), to serve for the une-,plred portion of the term of the Trustee who has resigned or otherwise ceased to be a Trustee. The appointment shall be made by a written instrument signed by a majority of the Trustees. The person appointed must be the same type of Trustee (i.e., PubliC Employee Trustee or ICMAlRC Trustee) as the person who has ceased to be a Trustee. An appointment of a Trustee may be made In anticipation of a vacancy to occur at a later date by reason of retirement or resignation, provided that such appointment shall not become effective prior to such retirement or resignation. Whenever a vacancy in the number of Trustees shall occur, until such vacancy IS filled as prOVided in thiS Section 3 5, the Trustees in office, regardless of their number, shall have all the powers granted to the Trustees and shall discharge all the duties Imposed upon the Trustees by thiS Declaration A written instrument certifYing the eXistence of such vacancy signed by a majority of the Trustees shall be conclUSive eVidence of the existence of such vacancy. SECTION 36 Trustees Serve 10 Representative Capacity. By executing thiS Declaration. each Public Employer agrees that the Public Employee Trustees elected by the Public Employers are authOrized to act as agents and representatives of the Public Employers collectively I ARTICLE IV. Powers 01 T...._ SECTION 4.1 General Powers. The Trustees shall have the power to conduct the bUSiness of the Trust and to carry on Its operations. Such power shall Include, but shall not be limited to, the power to: (a) receive the Trust Property from the PubliC Employers or from a Trustee of any Employer Trust, (b) enter Into a contract With an Investment Adviser provldmg, among other things, for the establishment and operation of the PortfoliOS, selection of the Guaranteed Investment Contracts in which the Trust Property may be mvested, selection of other Investments forthe Trust Property and the payment of reasonable fees to the Investment Adviser and to any sub--Investmentadvlser retalOed by the Investment AdViser; (c) review annually the performance of the Investment AdViser and approve annually the contract With such Investment Adviser, (d) Invest and reinvest the Trust Property In the Portfolios, the Guaranteed Investment Contracts and In any other Investment recommended by the Investment AdViser, provided that If a PubliC Employer has directed that Its monies be invested In specified PortfOliOS or In a Guaranteed Investment Contract, the Trustees of the Retirement Trust shall Invest such mOOles In accordance with such directions; (e) keep such portion of the Trust Propeny 10 cash or cash balances asthe Trustees. from time to time. may deem to be inthe best Interest of the Retirement Trust created hereby, Without liability for Interest thereon, (f) accept and retain for such time as they may deem advisable any securities or other property received or acqUired by them as Trustees hereunder, whether or not such securities or other property would normally be purchased as Investments here- under. (g) cause any secuntles or other property held as part of Ihe Trust Property to be registered In the name of the Retirement Trustor In the name of a nominee, and to hOld any Investments In bearer form, but the books and records of the Trustees shall at all times show that all such Investments are a part of the Trust Property; (h) make, execute. acknowledge. and deliver any and a1l documents of transfer and conveyance and any and all other instruments that may be necessary or appropriate to carry out the powers herein granted, (i) vote upon any stock. bonds. or other securities, give general or special proxies or powers of attorney with or Without power of substitution: exercise any conversion privileges, subscription lights. or other options, and make any payments Incidental thereto, oppose, or consent to, or otherwise participate In, corporate reorganizations or other changes affecting corporate secullties, and delegate discretionary powers, and pay any assessments or charges 10 connection therewith, and generally exercise any of the powers of an owner with respect to stocks, bonds, securities or other property held as part of the Trust Property; (j) enter into contracts or arrangements for goods or services required In connection with the operation of the Retirement Trust, including, but not limited to, contracts With custodians and contracts for the provision of administrative services; (k) borrow or raise money for the purpose of the Retirement Trust In such amount. and upon such terms and conditions, as the Trustees shall deem advisable, prOVided that the aggregate amount of such borrowings shall not exceed 30% of the value of the Trust Property No person lending money to the Trustees shall be bound to see the application of the money lent or to Inquire into Its validity, expediency or propllety of any such borrowing; (I) incur reasonable expenses as reqUIred for the operation of the Retirement Trust and deduct such expenses from the Trust Property; (m) pay expenses properly allocable to the Trust Property incurred 10 connection with the Deferred Compensahon Plans or the Employer Trusts and deduct such expenses from that portion of the Trust Property beneficially owned by the Public Employer to whom such expenses are properly allocable, (n) pay oul 01 the Trust Property all real and personal property taxes, income taxes and other taxes of any and all kinds WhiCh, in the opinion of the Trustees, are properly leVied. or assessed under existing or future laws upon, or in respect of, the Trust Property and allocate any such taxes to the appropriate accounts. (0) adopt, amend and repeallhe By-Laws, prov'~ed that such By- Laws are at all times conSIstent with the terms of thiS Declaration of Trust, (p) employ persons to make available Interests In the Retirement Trust to employers eligible to maintain a deferred compensation plan under section 457 of the Internal Revenue Code, as amended: (q) issue the Annual Report of the Retirement Trust, and the disclosure documents and other literature used by the Retirement Trust; (r) make loans, including the purchase of debt Obligations. provided that all such loans shall bear Interest at the current market rate. (s) contract for, and delegate any powers granted hereunder to, such officers. agents. employees, auditors and attorneys as the Trustees may select, provided that the Trustees may not delegate Ihe powers setlorth in paragraphs (b), (c) and (0) ollhis Section 4.1 and may not delegate any powers if such delegation would violate their fiduciary duties, (t) provide for the indemnification of the officers and Trustees of the Retirement Trust and purchase fidUCiary insurance; (u) maintain books and records, Including separate accounts for each PubliC Employer or Employer Trust and such additional separate accounts as are required under, and consistent with, the Delerred Compensation Plan 01 each PubliC Employer; and I 2 Resolution Number.3t# (v) do all such acts. take all such proceedings. and exercise all such rights and privileges. although not specifically mentioned herein. as the Trustees may deem necessary or appropriate to administer the Trust Property and to carry out the purposes of the Retirement Trust. SECTION 4 2. Olstrlbutlon of Trust Property. Distributions of the Trust Property shall be made to, or 0" behalf of. the PubliC Employer. In accordance with the terms of the Deferred Compensation Plans or Employer Trusts The Trustees of the Retirement Trust shall be fully protected In making payments In accordance with the directions of the Public Employers or the Trustees of the Employer Trusts without ascertaining whether such payments Bre in compliance with the provisions of the Deferred Compensation Plans or the agreements creating the Employer Trusts. SECTION 4.3. Execution 01 Instruments. The Trustees may unanimously designate anyone or more 01 the Trustees to execute any Instrument or document on behalf 01 all. Including but not limited to the sigOlng or endorsement 01 any check and the signing 01 any applications. insurance and other contracts. and the action of such designated Trustee or Trustees shall have the same force and effect as if taken by all the Trustees. ARTICLE V. Duty 01 Care and Liability 01 Tru._ SECTION 5.1. Duty of Care. In exerciSing the powers herelnbelore granted to the Trustees. the Trustees shall perform all acts Within their authOrity lor the exclUSive purpose 01 providing benefits for the Public Employers. and shall perform such acts with the care. skill. prudence and diligence in the Circumstances then prevailing that a prudent person acting In a like capacity and famihar With such matters would use in the conduct of an enterprise of a like character and With like alms. SECTION 5.2. Liability. The Trustees shall nol be liable !Of any mistake of Judgment or other action taken In good faith. and lor any action taken or omitted In reliance in good lalth upon the books of account or other records of the Retirement Trust. upon the opinion of counsel. or upon reports made to the Retirement Trust by any of its officers. employees or agents or by the Investment AdViser or any sub- investment adViser. accountants. appraisers or other experts or consultants selected With reasonable care by the Trustees. officers or employees of the Retirement Trust. The Trustees shall also not be liable for any loss sustained by the Trust Property by reason of any investment made In good faith and in accordance With the standard of care set forth in Section 5.1. SECTION 5 3. Bond. No Trustee shall be obligated to give any bond or other security for the performance of any of his or her duties hereunder ARTICLE VI, Annual Report to Shareholdars The Trustees shall annually submit to the Public Employers a wntten report of the transactions of the Retirement Trust. Including finanCial statements which shall be certified by Independent publiC accountants chosen by the Trustees. ARTICLE VII. DuraUon Dr Amendment of Retirement Tru.' I SECTION 7 1 Withdrawal. A Public Employer may. at any time. wlth~ draw from thiS Retirement Trust by dellv "Ing to the Board of Trustees a statement to that effect. The Withdrawing Public Emp'oyer's benefiCial interest in the Retirement Trust shall be paid out to the Public Employer or to the Trustee of the Employer Trust. as appropnate. SECTION 7 2. Duration. The Retirement Trust shall continue until terminated by the vote of a maJonty of the Public Employers. each casting one vote. Upon termlnallon. all of the Trust Property shall be paid out to the Public Employers or the Trustees of the Employer Trusts. as appropriate SECTION 7 3 Ameodment. The Retirement Trust may be amended by the vote of a majority of the PubliC Employers. each casting one vote SECTION 7 4 Procedure A resolution to termlOate or amend the Retirement Trust or to remove a Trustee shall be submitted to a vote of the Public Employers If: (a) a majority of the Trustees so direct. or (b) a petition requesting a vote. Signed by not less than 25% of the Public Employers. IS submitted to the Trustees ARTICLE VIII. Miscellaneous SECTION 8.1 GoverOlng Law Except as otherwise reqUired by state or local law. thiS Declarallon of Trust and the Rellrement Trust hereby created shall be construed and regulated by the laws of the Dlstnct of Columbia. SECTION 8.2 Counterparts. ThiS Declaration may be executed by the Public Employers and Trustees 10 twoor more counterparts. each of which shall be deemed an orlglOal but all of which together shall constitute one and the same Instrument. I 3 I Resolution Number~~~ APPENDIX C TRUST AGREEMENT WITH THE ICMA RETIREMENT CORPORATION I AGREEMENT made by and between the Employer named in the attached resolution and the International CIty Management Association Retirement Corporation (heremafter the "Trustee" or "Retirement Corporation"). a nonprofit corporation organized and existing under the Jaws of the State of Delaware. forthe purpose of investing and otherwise administering the funds set aside by Employers in connection with deferred compensation plans established under section 457 of the Internal Revenue Code of 1954 (the"Code"). This Agreement shall take effect upon acceptance by the Trustee of its apPointment by the Employer to serve as Trustee in accordance herewith as set forth in the attached resolution. WHEREAS. the Employer has established a deferred compensation plan under section 457 of the Code (the "Plan"); WHEREAS. In order that there will be suffiCient funds available to discharge the Employer's contractual obligations under the Plan, the Employer desires to set aside periodically amounts equal totheamount of compensation deferred, WHEREAS, the funds set aside, together with any and all assets derived from the Investment thereof, Bre to be exclusively within the dominion, control, and ownership of the Employer, and subject to the Employer's absolute right of withdrawal, no employees having any Interest whatsoever therein: NOW, THEREFORE, thiS Agreement witnesseth that (a) the Employer will pay mOnies to the Trustee to be placed in deferred compensation accounts for the Employer. (b) the Trustee covenants that It will hold said sums. and any other funds which it may receive hereunder. In trust for the uses and purposes and upon the terms and conditions hereinafter stated, and (c) the parties hereto agree as follows. I ARTICLE I. Genero. Duties of the Portlea. Section 1 1 General Duty of the Employer The Employer shall make regular periodiC payments equal to the amounts of its employees' compensation which are deferred In accordance With the terms and conditions of the Plan to the extent that such amounts are to be Invested under the Trust. Section 1 2 General Duties of the Trustee. The Trustee shalf hold all funds received by It hereunder, which. together With the Income therefrom, shall constitute the Trust Funds. It shall administer the Trust Funds, collect the mcome thereof, and make payments therefrom, all as herem after prOVided. The Trustee shall also hold all Trust Funds which are transferred to It as successor Trustee by the Employerfrom eXisting deferred compensation arrangements With Its Employees under plans deSCribed In section 457 of the Code Such Trust Funds shall be subject to all of the terms and provIsions of thiS Agreement ARTICLE II. Powers and Duties ot the Trustee In In.eatmont. Admlniltratlon. and Disbursement of the Trult Funds. Section 2 1 Investment Powers and Duties of the Trustee. The Trustee shall have the power to IOVest and reinvest the prinCipal and income of the Trust Funds and keep the Trust Funds invested, Without distinction between prlnc;pal and income. in securities or in other property. real or personal, wherever Situated, including, but not limited to. stOCks, common or preferred, bonds, retirement annuity and Insurance poliCies, mortgages, and other eVidences of Indebtedness or ownership, IOvestment companies. common or group trust funds. or separate and different types of funds (including eqUity, fixed income) which fulfill requirements of state and local governmental laws. I provided, however, that the Employer may direct investment by the Trustee among available investment alternatives in such proportions as the Employer authOriZes In connection With Its deferred compensation agreements with its employees For these purposes, these Trust Funds may be commingled With Trust Funds set aside by other Employers pursuant to the terms of the ICMA RetirementTrust.lnvestment powers vested in the Trustee by the Section may be delegated by the Trustee to any bank, Insurance or trust company, or any Investment adVisor, manager or agent selected by it Section 2.2 Administrative Powers of the Trustee The Trustee shall have the power In Its discretion: (a) To purchase, or subscribe for, any securities or other property and to retain the same in trust. (b) To sell, exchange, convey, transfer or otherWise dispose of any securities or other property held by It, by private contract, or at public auction No person dealing With the Trustee shall be bound to see the application of the purchase money or to Inquire mto the validity, expediency, or propriety of any such sale or other dispoSition. (c) To vote upon any stocks, bonds, or other secUrities, to give general or special proxies or powers of attorney With or Without power of substitution: to exerCise any converSion priVileges. subsCription rights, or other options. and to make any payments InCidental thereto, to oppose. or to consent to. or otherWise partiCipate In, corporate reorganizations or other changes affecting corporate secUrities, and to delegate discretionary powers. and to pay any assessments or charges In connection thereWith; and generally to exercise any of the powers of an owner With respect to stocks, bonds, seCUrities or other property held as part of the Trust Funds. (d) To cause any securities or other property held as part of the Trust Funds to be registered In Its own name. and to hOld any investments In bearer form, but the books and recOrds of the Trustee shall at all times show that all such investPlents are a part of the Trust Funds. (e) To borrow or raise money for the purpose of the Trust 10 such amount. and upon such terms and condItions, as the Trusteeshall deem advisable, and, for any sum so borrowed, to Issue Its promissory note as Trustee. and to secure the repayment thereof by pledgmg all, or any part. of the Trust Funds No person lendmg money to the Trustee shall be bound to see the application of the money lent or to Inquire Into ItS validity, expediency Or propriety of any such borrOWing (f) To keep such portion of the Trust Funds in cash or cash balances as the Trustee, from time to time. may deem to be in the best interest of the Trust created hereby, Without liability for Interest thereon. (g) To accept and retain for such time as It may deem adVisable any secUrities or other property received or acqUired by it as Trustee hereunder. whether or not such securities or other property would normally be purchased as investment hereunder. (h) To make, execute. acknowledge, and deliver Bny and all documents of transfer and conveyance and any and all other instruments that may be necessary or appropriate to carry out the powers herein granted Resolution Ilumber 3?#J/ (I) To settle. compromise. or submit to arbitration any claims. debts. or damages due or oWing to or from the Trust Funds. to commence or defend SUits or legal or administrative proceedings. and to represent the Trust Funds in all SUits and legal and administrative proceedings. (J) To do all such acts. take all such proceedings. and exerCise all such nghts and privileges. although not specifically mentioned herein, as the Trustee may deem necessary to admln.ster the Trust Funds and to carry out the purposes of thiS Trust. Section 2.3. Dlstrrbutions from the Trust Funds. The Employer hereby appOints the Trustee as Its agent for the purpose of making distributions from the Trust Funds. In this regard the terms and conditions set forth in the Plan are to guide and control the Trustee's power. Section 2.4. Valuation of Trust Funds. At least once a year as of Valuation Dates designated by the Trustee. the Trustee shall determine the value of the Trust Funds. AssetBofthe Trust Funds shall be valued at their market values at the close of business on the Valuation Date. or. in the absence of readily ascertainable market values as the Trustee shall determine, in accordance with methods consistently followed and uniformly applied. ARTICLE III. For Protecllon 01 Trull... Section 3.1 EVidence of Action by Employer The Trustee may rely upon any certificate, notice or direction purporting to have been signed on behalf of the Employer which the Trustee beheves to have been signed by a duly designated official of the Employer No communication shall be binding upon any of the Trust Funds or Trustee until they are received by the Trustee. Section 32. AdVice of Counsel. The Trustee may consult with any legal counsel with respect to the construction of thiS Agreement, ItS duties hereunder, or any act, which It proposes to take or omit. and shall not be liable for any action taken or omitted In good faith pursuant to such adVice. Section 3.3. Miscellaneous The Trustee shall use ordinary care and reasonable diligence. but shall not be liable for any mistake of jUdgment or other action taken in good faith. The Trustees.hall not be liable for any loss sustained by the Trust Funds by reasons of any investment made in good faith and In accordance with the provIsions of this Agreement. The Trustee's duties and obligations shall be limited to those expressly imposed upon it by thiS Agreement ARTICLE IV. Ta.... E.penl.. and Compenlallan 01 Truet... Section 4.1. Taxes. The Trustee shall deduct from and Charge against the Trust Funds any taxes on the Trust Funds or the Income thereot or which the Trustee IS required to pay with respect to the Interest of any person therein. Section 4.2. Expenses. The Trustee shall deduct from and charge against the Trust Funds all reasonable expenses incurred by the Trustee In the administration of the Trust Funds, Including counsel, agency. Investment adVISOry, and other necessary fees ARTICLE V. Selllement 01 Accounll. The Trustee shall keep accurate and detailed accounts of all investments, receipts, disbursements. and other transactions hereunder Within ninety (90) days after the close of each fiscal year, the Trustee shall render In duplicate to the Employer an account of its acts and transactions as Trustee hereunder. If any part of the Trust Fund shall be Invested through the medium of any common. collectiveorcommlngled Trust Funds. the last annual report of such Trust Funds shall be submitted with and incorporated In the account. If within mnety (90) days after the mailing of the account or any amended account the Employer has not filed with the Trustee notice of any objection to any act or transaction of the Trustee. the account or amended account shall become an account stated. If any objection has been filed, and If the Employer is satisfied that It should be withdrawn or ,f the account is adJusted to the Employer's satisfaction, the Employer shall In writing filed with the Trusteesignlfy approval of the account and it shall become an account stated When an account becomes an account stated. such account shall be finally settled. and the Trustee shall be completely discharged and released. as If such account had been settled and allowed by a judgment or decree of a court of competent jUrisdiction in an action or proceeding in whIch the Trustee and the Employer were parties. The Trustee shall have the right to apply at any time to a court of competent JurisdictIon for the judicial settlement of its account. ARTICLE VI. Rellgnotlon ond Remo... 01 Trull... I Section 6 1 Resignation of Trustee. The Trustee may resign at any time by flhng with the Employer Its written reSignation. Such resignation shall take eflect sIxty (60) days Irom Ihe date of such filing and upon appointment of a successor pursuant to Section 6.3., whichever shall first occur. Section 6.2. Removal of Trustee. The Employer may remove the Trustee at any time by delivering to the Trustee a written notice of Its removal and an appointment of a successor pursuant to Section 6.3. Such removal shall not take effect prior to sixty (60) days from such delivery unless the Trustee agrees to an earlier effective date. Section 6 3. AppOintment of Successor Trustee The appointment of a successor to the Trustee shall take effect upon the delivery to the Trustee of (a) an Instrument In writing executed by the Employer appointing such successor, and exonerating such successor from liability for the acts and omiSSions of Its predecessor, and (b) an acceptance in writing, executed by such successor. All of the provIsions set forth herein wIth respect to the Trustee shall relate to each successor with the same force and effect as If such successor had been originally named as Trustee hereunder If a successor is not apPointed with SIXty (60) days after the Trustee gives notice of ItS resignation pursuant to Section 6 1, the Trustee may apply to any court of competent jUrisdiction for appointment of a successor. Section 6.4. Transfer of Funds to Successor Upon the resignation or removal of the Trustee and appointment of a successor, and after the final account of the Trustee has been properly settled, the Trustee shall transfer and deliver any of the Trust Funds involved to such successor. ARTICLE VII. Durollon and Ro.aeollon 01 Trull Agreemenl Section 7.1. Duration and Revocation. ThiS Trust shall continue for I such time as may be necessary to accomplish the purpose for which it was created but may be terminated or revoked at any time by the Employer as it relates to any and/or all related participating Employees Written notice of such termination or revocatIon shall be given to the Trustee by the Employer. Upon termmation or revocatIon of the Trust. all of the assets thereof shall return to and revert to the Employer. Termination of thiS Trust shall not, however. relieve the Employer of the Employer's continuing obligation to pay deferred compensation to Employees In accordance With the terms of the Plan. Section 7 2. Amendment The Employer shall have the right to amend thIS Agreement in whole and In part but only with the Trustee's written consent. Any SuCh amendment shall become effective upon (a) delivery to the Trustee of a written Instrument of amendment, and (b) the endorsement by the Trustee on such Instrument of ItS consent thereto. ARTICLE VIII. Mlecellanooue, Section 8 1. Lawa 01 the DIstrict 01 Columbia to Govern. This Agreement and the Trust hereby created shall be construed and regulated by the laws of Ihe Dislrict 01 Columboa. Section 8.2 Successor Employers. The "Employer" shalllOclude any person who succeeds the Employer and who thereby becomes subject to the obligations of the Employer under the Plan. Section 8 3. Withdrawals. The Employer may, at any time, and from time to time. Withdraw a portion or all of Trust Funds created by thiS Agreement. Section 8.4. Gender and Number. The masculine Includes the feminine and theslOgular includes the plural unless the context requires another meaning. 2 I