Exhibit 4.3
EGTRRA
AMENDMENT TO THE
American Pacific Corporation 401(k) Plan
ARTICLE I
PREAMBLE
1.1 ADOPTION AND EFFECTIVE DATE OF AMENDMENT. This amendment of the plan
is adopted to reflect certain provisions of the Economic Growth and
Tax Relief Reconciliation Act of 2001 ("EGTRRA"). This amendment is
intended as good faith compliance with the requirements of EGTRRA
and is to be construed in accordance with EGTRRA and guidance issued
thereunder. Except as otherwise provided, this amendment shall be
effective as of the first day of the first plan year beginning after
December 31, 2001.
1.2 SUPERSESSION OF INCONSISTENT PROVISIONS. This amendment shall
supersede the provisions of the plan to the extent those provisions
are inconsistent with the provisions of this amendment.
ARTICLE II
ADOPTION AGREEMENT ELECTIONS
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The questions in this Article II only need to be completed in order
to override the default provisions set forth below. If all of the
default provisions will apply, then these questions should be
skipped.
Unless the employer elects otherwise in this Article II, the
following defaults apply:
1) The vesting schedule for matching contributions will be a 6
year graded schedule (if the plan currently has a graded
schedule that does not satisfy EGTRRA) or a 3 year cliff
schedule (if the plan currently has a cliff schedule that does
not satisfy EGTRRA), and such schedule will apply to all
matching contributions (even those made prior to 2002).
2) Rollovers are automatically excluded in determining whether the
$5,000 threshold has been exceeded for automatic cash-outs (if
the plan is not subject to the qualified joint and survivor
annuity rules and provides for automatic cash-outs). This is
applied to all participants regardless of when the
distributable event occurred.
3) The suspension period after a hardship distribution is made
will be 6 months and this will only apply to hardship
distributions made after 2001.
4) Catch-up contributions will be allowed.
5) For target benefit plans, the increased compensation limit of
$200,000 will be applied retroactively (i.e., to years prior to
2002).
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2.1 Vesting Schedule for Matching Contributions
If there are matching contributions subject to a vesting schedule
that does not satisfy EGTRRA, then unless otherwise elected below,
for participants who complete an hour of service in a plan year
beginning after December 31, 2001, the following vesting schedule
will apply to all matching contributions subject to a vesting
schedule:
If the plan has a graded vesting schedule (i.e., the vesting
schedule includes a vested percentage that is more than 0% and less
than 100%) the following will apply:
Years of vesting service Nonforfeitable percentage
2 20%
3 40%
4 60%
5 80%
6 100%
If the plan does not have a graded vesting schedule, then matching
contributions will be nonforfeitable upon the completion of 3 years
of vesting service.
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In lieu of the above vesting schedule, the employer elects the
following schedule:
a. [ ] 3 year cliff (a participant's accrued benefit derived from
employer matching contributions shall be nonforfeitable upon
the participant's completion of three years of vesting
service).
b. [ ] 6 year graded schedule (20% after 2 years of vesting service
and an additional 20% for each year thereafter).
c. [ ] Other (must be at least as liberal as a. or the b. above):
Years of vesting service Nonforfeitable percentage
-------- ---------%
-------- ---------%
-------- ---------%
-------- ---------%
-------- ---------%
The vesting schedule set forth herein shall only apply to
participants who complete an hour of service in a plan year
beginning after December 31, 2001, and, unless the option below is
elected, shall apply to all matching contributions subject to a
vesting schedule.
d. [ ] The vesting schedule will only apply to matching
contributions made in plan years beginning after December 31,
2001 (the prior schedule will apply to matching contributions
made in prior plan years).
2.2 EXCLUSION OF ROLLOVERS IN APPLICATION OF INVOLUNTARY CASH-OUT
PROVISIONS (FOR PROFIT SHARING AND 401(K) PLANS ONLY). If the plan
is not subject to the qualified joint and survivor annuity rules and
includes involuntary cash-out provisions, then unless one of the
options below is elected, effective for distributions made after
December 31, 2001, rollover contributions will be excluded in
determining the value of the participant's nonforfeitable account
balance for purposes of the plan's involuntary cash-out rules.
a. [ ] Rollover contributions will not be excluded.
b. [ ] Rollover contributions will be excluded only with respect to
distributions made after _____________. (Enter a date no
earlier than December 31, 2001.)
c. [ ] Rollover contributions will only be excluded with respect to
participants who separated from service after _____. (Enter a
date. The date may be earlier than December 31, 2001.)
2.3 SUSPENSION PERIOD OF HARDSHIP DISTRIBUTIONS. If the plan provides
for hardship distributions upon satisfaction of the safe harbor
(deemed) standards as set forth in Treas. Reg. Section
1.401(k)-1(d)(2)(iv), then, unless the option below is elected, the
suspension period following a hardship distribution shall only apply
to hardship distributions made after December 31, 2001.
[ ] With regard to hardship distributions made during 2001, a
participant shall be prohibited from making elective deferrals
and employee contributions under this and all other plans
until the later of January 1, 2002, or 6 months after receipt
of the distribution.
2.4 CATCH-UP CONTRIBUTIONS (FOR 401(K) PROFIT SHARING PLANS ONLY): The
plan permits catch-up contributions (Article VI) unless the option
below is elected.
[ ] The plan does not permit catch-up contributions to be made.
ARTICLE III
VESTING OF MATCHING CONTRIBUTIONS
3.1 APPLICABILITY. This Article shall apply to participants who complete
an Hour of Service after December 31, 2001, with respect to accrued
benefits derived from employer matching contributions made in plan
years beginning after December 31, 2001. Unless otherwise elected by
the employer in Section 2.1 above, this Article shall also apply to
all such participants with respect to accrued benefits derived from
employer matching contributions made in plan years beginning prior
to January 1, 2002.
3.2 VESTING SCHEDULE. A participant's accrued benefit derived from
employer matching contributions shall vest as provided in Section
2.1 of this amendment.
ARTICLE IV
INVOLUNTARY CASH-OUTS
4.1 APPLICABILITY AND EFFECTIVE DATE. If the plan provides for
involuntary cash-outs of amounts less than $5,000, then unless
otherwise elected in Section 2.2 of this amendment, this Article
shall apply for distributions made after December 31, 2001, and
shall apply to all participants. However, regardless of the
preceding, this Article shall not apply if the plan is subject to
the qualified joint and survivor annuity requirements of Sections
401(a)(11) and 417 of the Code.
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4.2 ROLLOVERS DISREGARDED IN DETERMINING VALUE OF ACCOUNT BALANCE FOR
INVOLUNTARY DISTRIBUTIONS. For purposes of the Sections of the plan
that provide for the involuntary distribution of vested accrued
benefits of $5,000 or less, the value of a participant's
nonforfeitable account balance shall be determined without regard to
that portion of the account balance that is attributable to rollover
contributions (and earnings allocable thereto) within the meaning of
Sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and
457(e)(16) of the Code. If the value of the participant's
nonforfeitable account balance as so determined is $5,000 or less,
then the plan shall immediately distribute the participant's entire
nonforfeitable account balance.
ARTICLE V
HARDSHIP DISTRIBUTIONS
5.1 APPLICABILITY AND EFFECTIVE DATE. If the plan provides for hardship
distributions upon satisfaction of the safe harbor (deemed)
standards as set forth in Treas. Reg. Section 1.401(k)-1(d)(2)(iv),
then this Article shall apply for calendar years beginning after
2001.
5.2 SUSPENSION PERIOD FOLLOWING HARDSHIP DISTRIBUTION. A participant who
receives a distribution of elective deferrals after December 31,
2001, on account of hardship shall be prohibited from making
elective deferrals and employee contributions under this and all
other plans of the employer for 6 months after receipt of the
distribution. Furthermore, if elected by the employer in Section 2.3
of this amendment, a participant who receives a distribution of
elective deferrals in calendar year 2001 on account of hardship
shall be prohibited from making elective deferrals and employee
contributions under this and all other plans until the later of
January 1, 2002, or 6 months after receipt of the distribution.
ARTICLE VI
CATCH-UP CONTRIBUTIONS
CATCH-UP CONTRIBUTIONS. Unless otherwise elected in Section 2.4 of this
amendment, all employees who are eligible to make elective deferrals under this
plan and who have attained age 50 before the close of the plan year shall be
eligible to make catch-up contributions in accordance with, and subject to the
limitations of, Section 414(v) of the Code. Such catch-up contributions shall
not be taken into account for purposes of the provisions of the plan
implementing the required limitations of Sections 402(g) and 415 of the Code.
The plan shall not be treated as failing to satisfy the provisions of the plan
implementing the requirements of Section 401(k)(3), 401(k)(11), 401(k)(12),
410(b), or 416 of the Code, as applicable, by reason of the making of such
catch-up contributions.
ARTICLE VII
INCREASE IN COMPENSATION LIMIT
INCREASE IN COMPENSATION LIMIT. The annual compensation of each participant
taken into account in determining allocations for any plan year beginning after
December 31, 2001, shall not exceed $200,000, as adjusted for cost-of-living
increases in accordance with Section 401(a)(17)(B) of the Code. Annual
compensation means compensation during the plan year or such other consecutive
12-month period over which compensation is otherwise determined under the plan
(the determination period). If this is a target benefit plan, then except as
otherwise elected in Section 2.5 of this amendment, for purposes of determining
benefit accruals in a plan year beginning after December 31, 2001, compensation
for any prior determination period shall be limited to $200,000. The
cost-of-living adjustment in effect for a calendar year applies to annual
compensation for the determination period that begins with or within such
calendar year.
ARTICLE VIII
PLAN LOANS
PLAN LOANS FOR OWNER-EMPLOYEES OR SHAREHOLDER-EMPLOYEES. If the plan permits
loans to be made to participants, then effective for plan loans made after
December 31, 2001, plan provisions prohibiting loans to any owner-employee or
shareholder-employee shall cease to apply.
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ARTICLE IX
LIMITATIONS ON CONTRIBUTIONS (IRC SECTION 415 LIMITS)
9.1 EFFECTIVE DATE. This Section shall be effective for limitation years
beginning after December 31, 2001.
9.2 MAXIMUM ANNUAL ADDITION. Except to the extent permitted under
Article VI of this amendment and Section 414(v) of the Code, if
applicable, the annual addition that may be contributed or allocated
to a participant's account under the plan for any limitation year
shall not exceed the lesser of:
a. $40,000, as adjusted for increases in the cost-of-living under
Section 415(d) of the Code, or
b. 100 percent of the participant's compensation, within the
meaning of Section 415(c)(3) of the Code, for the limitation
year.
The compensation limit referred to in b. shall not apply to any
contribution for medical benefits after separation from service
(within the meaning of Section 401(h) or Section 419A(f)(2) of the
Code) which is otherwise treated as an annual addition.
ARTICLE X
MODIFICATION OF TOP-HEAVY RULES
10.1 EFFECTIVE DATE. This Article shall apply for purposes of determining
whether the plan is a top-heavy plan under Section 416(g) of the
Code for plan years beginning after December 31, 2001, and whether
the plan satisfies the minimum benefits requirements of Section
416(c) of the Code for such years. This Article amends the top-heavy
provisions of the plan.
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10.2 DETERMINATION OF TOP-HEAVY STATUS.
10.2.1 KEY EMPLOYEE. Key employee means any employee or former employee
(including any deceased employee) who at any time during the plan
year that includes the determination date was an officer of the
employer having annual compensation greater than $130,000 (as
adjusted under Section 416(i)(1) of the Code for plan years
beginning after December 31, 2002), a 5-percent owner of the
employer, or a 1-percent owner of the employer having annual
compensation of more than $150,000. For this purpose, annual
compensation means compensation within the meaning of Section
415(c)(3) of the Code. The determination of who is a key employee
will be made in accordance with Section 416(i)(1) of the Code and
the applicable regulations and other guidance of general
applicability issued thereunder.
10.2.2 DETERMINATION OF PRESENT VALUES AND AMOUNTS. This Section 10.2.2
shall apply for purposes of determining the present values of
accrued benefits and the amounts of account balances of employees as
of the determination date.
a. DISTRIBUTIONS DURING YEAR ENDING ON THE DETERMINATION DATE. The
present values of accrued benefits and the amounts of account
balances of an employee as of the determination date shall be
increased by the distributions made with respect to the employee
under the plan and any plan aggregated with the plan under
Section 416(g)(2) of the Code during the 1-year period ending on
the determination date. The preceding sentence shall also apply
to distributions under a terminated plan which, had it not been
terminated, would have been aggregated with the plan under
Section 416(g)(2)(A)(i) of the Code. In the case of a
distribution made for a reason other than separation from
service, death, or disability, this provision shall be applied
by substituting "5-year period" for "1-year period."
b. EMPLOYEES NOT PERFORMING SERVICES DURING YEAR ENDING ON THE
DETERMINATION DATE. The accrued benefits and accounts of any
individual who has not performed services for the employer
during the 1-year period ending on the determination date shall
not be taken into account.
10.3 MINIMUM BENEFITS.
10.3.1 MATCHING CONTRIBUTIONS. Employer matching contributions shall be
taken into account for purposes of satisfying the minimum
contribution requirements of Section 416(c)(2) of the Code and the
plan. The preceding sentence shall apply with respect to matching
contributions under the plan or, if the plan provides that the
minimum contribution requirement shall be met in another plan, such
other plan. Employer matching contributions that are used to satisfy
the minimum contribution requirements shall be treated as matching
contributions for purposes of the actual contribution percentage
test and other requirements of Section 401(m) of the Code.
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10.3.2 CONTRIBUTIONS UNDER OTHER PLANS. The employer may provide, in an
addendum to this amendment, that the minimum benefit requirement
shall be met in another plan (including another plan that consists
solely of a cash or deferred arrangement which meets the
requirements of Section 401(k)(12) of the Code and matching
contributions with respect to which the requirements of Section
401(m)(11) of the Code are met). The addendum should include the
name of the other plan, the minimum benefit that will be provided
under such other plan, and the employees who will receive the
minimum benefit under such other plan.
ARTICLE XI
DIRECT ROLLOVERS
11.1 EFFECTIVE DATE. This Article shall apply to distributions made after
December 31, 2001.
11.2 MODIFICATION OF DEFINITION OF ELIGIBLE RETIREMENT PLAN. For purposes
of the direct rollover provisions of the plan, an eligible
retirement plan shall also mean an annuity contract described in
Section 403(b) of the Code and an eligible plan under Section 457(b)
of the Code which is maintained by a state, political subdivision of
a state, or any agency or instrumentality of a state or political
subdivision of a state and which agrees to separately account for
amounts transferred into such plan from this plan. The definition of
eligible retirement plan shall also apply in the case of a
distribution to a surviving spouse, or to a spouse or former spouse
who is the alternate payee under a qualified domestic relation
order, as defined in Section 414(p) of the Code.
11.3 MODIFICATION OF DEFINITION OF ELIGIBLE ROLLOVER DISTRIBUTION TO
EXCLUDE HARDSHIP DISTRIBUTIONS. For purposes of the direct rollover
provisions of the plan, any amount that is distributed on account of
hardship shall not be an eligible rollover distribution and the
distributee may not elect to have any portion of such a distribution
paid directly to an eligible retirement plan.
11.4 MODIFICATION OF DEFINITION OF ELIGIBLE ROLLOVER DISTRIBUTION TO
INCLUDE AFTER-TAX EMPLOYEE CONTRIBUTIONS. For purposes of the direct
rollover provisions in the plan, a portion of a distribution shall
not fail to be an eligible rollover distribution merely because the
portion consists of after-tax employee contributions which are not
includible in gross income. However, such portion may be transferred
only to an individual retirement account or annuity described in
Section 408(a) or (b) of the Code, or to a qualified defined
contribution plan described in Section 401(a) or 403(a) of the Code
that agrees to separately account for amounts so transferred,
including separately accounting for the portion of such distribution
which is includible in gross income and the portion of such
distribution which is not so includible.
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ARTICLE XII
ROLLOVERS FROM OTHER PLANS
ROLLOVERS FROM OTHER PLANS. The employer, operationally and on a
nondiscriminatory basis, may limit the source of rollover contributions that may
be accepted by this plan.
ARTICLE XIII
REPEAL OF MULTIPLE USE TEST
REPEAL OF MULTIPLE USE TEST. The multiple use test described in Treasury
Regulation Section 1.401(m)-2 and the plan shall not apply for plan years
beginning after December 31, 2001.
ARTICLE XIV
ELECTIVE DEFERRALS
14.1 ELECTIVE DEFERRALS - CONTRIBUTION LIMITATION. No participant shall
be permitted to have elective deferrals made under this plan, or any
other qualified plan maintained by the employer during any taxable
year, in excess of the dollar limitation contained in Section 402(g)
of the Code in effect for such taxable year, except to the extent
permitted under Article VI of this amendment and Section 414(v) of
the Code, if applicable.
14.2 MAXIMUM SALARY REDUCTION CONTRIBUTIONS FOR SIMPLE PLANS. If this is
a SIMPLE 401(k) plan, then except to the extent permitted under
Article VI of this amendment and Section 414(v) of the Code, if
applicable, the maximum salary reduction contribution that can be
made to this plan is the amount determined under Section
408(p)(2)(A)(ii) of the Code for the calendar year.
ARTICLE XV
SAFE HARBOR PLAN PROVISIONS
MODIFICATION OF TOP-HEAVY RULES. The top-heavy requirements of Section 416 of
the Code and the plan shall not apply in any year beginning after December 31,
2001, in which the plan consists solely of a cash or deferred arrangement which
meets the requirements of Section 401(k)(12) of the Code and matching
contributions with respect to which the requirements of Section 401(m)(11) of
the Code are met.
ARTICLE XVI
DISTRIBUTION UPON SEVERANCE OF EMPLOYMENT
16.1 EFFECTIVE DATE. This Article shall apply for distributions and
transactions made after December 31, 2001, regardless of when the
severance of employment occurred.
16.2 NEW DISTRIBUTABLE EVENT. A participant's elective deferrals,
qualified nonelective contributions, qualified matching
contributions, and earnings attributable to these contributions
shall be distributed on account of the participant's severance from
employment. However, such a distribution shall be subject to the
other provisions of the plan regarding distributions, other than
provisions that require a separation from service before such
amounts may be distributed.
This amendment has been executed this 13th day of May, 2003.
Name of Employer: American Pacific Corporation
By: /s/ John R. Gibson
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EMPLOYER
Name of Plan: American Pacific Corporation 401(k) Plan
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