Traditional Defined Contribution Plans

In a traditional Defined Contribution Plan, individual participant accounts are maintained by the plan record keeper, with contribution allocations and all earnings credited to individual accounts each period. Within this overall structure, there are three major types of traditional Defined Contribution Plans.

A Profit Sharing Plan is a plan in which the employer may make discretionary contributions. Typically, contributions are allocated pro rata based on the participant's compensation, however the plan may also be integrated with Social Security. A participant's retirement benefit equals the amount in his or her individual account at retirement.

In a Money Purchase Plan, Employer contributions are mandatory, as outlined in the plan document. Typically, contributions are stated as a percentage of participants' compensation. These plans may also be integrated with Social Security.

In contrast, an Employee Stock Ownership Plan (ESOP) is a profit sharing or money purchase plan in which plan assets are required to be invested primarily in Employer Stock. Generally, the allocation formula used in an ESOP is also based on compensation.

Finally, Age-Weighted and other Cross-Tested Profit Sharing Plans are Defined Contribution Plans that employ Defined Benefit funding concepts to leverage contributions to older employees who are usually representative of upper management.

Beyer-Barber Company will provide the following administration and record keeping services with respect to Traditional Defined Contribution Plans:

Prepare an Employer Administration Manual to assist in day-to-day plan administration

Audit and update the employee database

Administrative Services:

• The preparation and delivery of a periodic (annual, semiannual, quarterly, monthly) Allocation Report, which includes the following:
  - Determination of eligible employees
  - Allocation of employer contributions
  - Allocation of forfeitures, if required
  - Allocation of investment gains or losses
  - Determination of vested percentages and amounts
  - Trust financial statement reconciliation

• Preparation of individual participant statements

• Minimum Coverage Testing (Section 410(b))

• Top-heavy Testing

• Section 415 Testing

• IRS Form 5500 Series

• Summary Annual Report (SAR)

• Process participant loans, including documentation and maintenance

• Process miscellaneous in-service distributions, including calculations of maximum amount available

• Prepare distribution forms for terminated participants

• Plan document design

• Ongoing monitoring of legislative and regulatory developments

• Ongoing consulting on plan design and plan operation

• Alternative plan design studies

• Qualified Domestic Relations Order (QDRO) review