Company discretionary contributions
At the end of each Plan Year, the Company will decide on the amount of its discretionary contribution for that year. The Company is not required to make a discretionary contribution.
After you become a participant, you will share in the Company's discretionary contribution, if one is made, for a Plan Year if:
- You are employed on the last day of the Plan Year and have at least 1,000 hours of service during the Plan Year; or
- You terminate employment during the Plan Year as a result of your retirement after reaching age 65, total disability, or death.
An hour of service is each hour for which you are paid or entitled to be paid by the Company or an affiliate of the Company.
Your share of the Company's discretionary contribution will be a percentage of your compensation while you are a participant during the Plan Year. If the Company contributes less than 7% of the total compensation of all participants during the Plan Year, a cap will apply to the amount of compensation qualifying for the maximum discretionary contribution percentage.
Assume the Company makes a 7% discretionary contribution for a Plan Year in which your compensation is $30,000. Your share of the Company discretionary contribution is $2,100, and it will be credited to your "discretionary contribution account."
Assume that your Plan Year compensation is $125,000, and that the Company makes a 7% discretionary contribution for compensation capped at $110,000. Your share of the discretionary contribution is $7,700.
Assume that your Plan Year compensation is $125,000, and that the Company makes a discretionary contribution of 7% of compensation up to $110,000 and 1% of compensation above $110,000. Your share of the discretionary contribution is $7,850.