Township of South Whitehall, PA Office Personnel Pension Plan

A person who was never employed by the Employer at any time before January 1, 2015, in a position for which work was regularly scheduled for more than 1,500 hours per year (or would have been so scheduled except for authorized sick time, holidays, vacation time, leave, and similar paid or unpaid time off);

A person who is included in a unit of employees covered by a negotiated collective bargaining agreement which does not provide for his/her inclusion as a Qualified Employee eligible for participation in this Plan, provided that retirement benefits were the subject of good faith bargaining and less than 2% of the employees of the Employer who are covered pursuant to that agreement are "professionals" as defined in Treas. Regs. § 1.410(b)-9(g);

An employee of a police department or fire department organized and operated by the Employer, if the employee provides police protection, firefighting services, or emergency medical services for any area within the jurisdiction of the Employer; nor

YEARS OF BENEFIT ACCRUAL SERVICE

The Township Treasurer, Tax Collector, a per diem employee, or an elected official, other than those who are employed by the Employer in an independent employee status. In the later event, the person shall only be considered a Qualified Employee with respect to the independent employee status.

No self-employed individual or leased employee who is not a common-law employee of the Employer may be a Qualified Employee or a Participant in this Plan.

TRUST

The trust described in § 58-24B to hold the funds to be used to provide benefits under the Plan, and designated the South Whitehall Office Personnel Pension Trust.

TRUSTEE

The trustee of the Trust.

As of any given date, the meaning ascribed to that term in § 58-17B.

YEARS OF VESTING SERVICE

As of any given date, the meaning ascribed to that term in § 58-17A.

§ 58-17 Service.

Vesting service. A person's vesting service as of any given date (the "determination date") shall be determined as follows:

Days of vesting service.

In general. Except as provided in Subsection A(1)(b), the person shall be credited with one day of vesting service for each calendar day:

[1]

That he is actually employed by the Employer (whether as a Qualified Employee or not), including normal vacations, holidays, sick leave, weekends and other days off; or

[2]

Of service in the uniformed services of the United States, provided that (I) such service immediately follows service with the Employer as a Qualified Employee, and (II) the person returns to employment with the Employer at a time when the Employer is legally obligated to reemploy the person under the Uniformed Services Employment and Reemployment Rights Act of 1994, 38 U.S.C. § 4301 et seq., and any amendments, supplements or successor legislation. Credit under this Subsection A(1)(a)[2] shall be granted upon the person's return to employment with the Employer.

Exclusions. Notwithstanding the provisions of Subsection A(1)(a), a day of vesting service shall not be credited as of the determination date for any working or nonworking day:

[1]

Within any period of employment solely as an elected official;

[2]

Within any period of employment in a position regularly scheduled for fewer than 1,500 hours of work in a calendar year;

[3]

During any layoff;

[4]

Within any leave of absence;

[5]

Within any period of service in the uniformed services of the United States, except as provided in Subsection A(1)(a)(2);

[6]

Within any period of disability which lasts longer than 20 calendar days (or the number of sick days available to the person at the time of the disability, if longer);

[7]

After the determination date; or

[8]

On or before the date of any Disqualifying Event which occurs with respect to the person before the determination date.

Months of vesting service. The number of months of vesting service credited to the person as of the determination date shall be the sum of:

The number of calendar months in which every day of the month is a day of vesting service; and

The number of days of vesting service credited to the person as of the determination date, other than those described under Subsection A(2)(a), divided by the actual number of days in such calendar month (rounding down any fraction to the next whole number and eliminating any fractional amount).

Years of Vesting Service. The number of Years of Vesting Service credited to the person as of the determination date, which number may be expressed as a fraction, shall be the number of months of vesting service credited to the person as of the determination date divided by 12.

Benefit accrual service. A person's benefit accrual service as of any given date (the "determination date") shall be determined by applying the provisions of Subsection A with the following modifications:

The words "vesting service" shall be replaced with the words "benefit accrual service" every time they occur therein; and

Subsection A(1)(b)[2] shall be modified to read as follows: "within any period that the person is not a Qualified Employee."

§ 58-18 Participation.

Continuing participants. All persons who were Qualified Employees on January 1, 2010, and were members of or participants in the Plan immediately before that date shall continue as Participants under this Plan as of January 1, 2010.

New participants. A present or future employee of the Employer other than one described in Subsection A shall become a Participant on the later of (1) the 91st day following the commencement of his employment with the Employer (whether as a Qualified Employee or not), or (2) the day the person first becomes a Qualified Employee.

Termination of participation. A Participant shall cease to be a Participant under this Plan upon the occurrence of a Disqualifying Event. A Participant shall also cease to be a Participant under this Plan if he ceases to be a Qualified Employee but continues in the employ of the Employer. He shall then be a former Participant until all benefits to which he may be entitled hereunder are paid.

Reemployment of a former participant.

If a person who formerly was a Participant shall again become a Qualified Employee, and no Disqualifying Event shall have occurred at or after the time he ceased to be a Participant, he shall again become a Participant immediately upon becoming a Qualified Employee.

If a person who formerly was a Participant in this Plan or the South Whitehall Township Employees' Pension Plan shall again become a Qualified Employee, and a Disqualifying Event shall have occurred at or after the time he ceased to be a Participant, he shall be treated as if he were two different employees - one who was employed at the earlier time and one who was employed at the later time. Thus, he shall be treated as an entirely new employee of the Employer for purposes of any benefits under this Plan related to the new period of employment, and shall become a Participant again only under the terms of Subsection B; his benefits for the new period shall be based solely on Compensation and service during the new period. However, he shall retain the right to receive all unpaid vested pension benefits to which he is entitled with respect to his previous period of employment in accordance with the pension provisions of the Plan in effect on the last day of the previous period of employment, without regard to any Plan amendments enacted thereafter (see § 58-22E) or any Compensation from or service to the Employer thereafter. Any benefits payable with respect to the previous period of employment shall be in addition to any benefits payable with respect to the new period of employment.

§ 58-19 Benefits: in general.

Normal retirement benefit. A Participant or former Participant shall be entitled to receive a normal retirement benefit if he retires from all employment with the Employer after having attained the age of 65 years and at a time when he has at least seven Years of Vesting Service. The normal retirement benefit shall be paid in the following form, unless the Participant or former Participant elects an optional form under § 58-20: a series of equal monthly payments beginning on the first day of the month following retirement and ending on the first day of the month following the month during which the recipient's death occurs, in an amount equal to 1.5% of his Final Average Monthly Compensation multiplied by his Years of Benefit Accrual Service as of the date of retirement. Notwithstanding the foregoing, a Participant who retires from all employment with the Employer on or after December 1, 2004, and has attained the age of 65 years and has completed at least seven Years of Vesting Service shall be eligible to receive a normal retirement benefit in an amount equal to 2% of his Final Average Monthly Compensation multiplied by his Years of Benefit Accrual Service as of the date of retirement.

Deferred retirement benefit. If a Participant or former Participant retires from all employment with the Employer more than one month after the first date he could have retired under Subsection A (relating to normal retirement), he shall receive the deferred retirement benefit rather than the normal retirement benefit if the former is of greater Equivalent Actuarial Value. The deferred retirement benefit shall be paid in the following form, unless the Participant or former Participant elects an optional form under § 58-20: a series of equal monthly payments beginning on the first day of the month following retirement and ending on the first day of the month following the month during which the recipient's death occurs, in an amount such that the deferred retirement benefit is of Equivalent Actuarial Value to the normal retirement benefit (determined under § 58-19A) which would have been payable to the recipient if he had retired on the first date he could have retired under Subsection A (relating to normal retirement) and not earned any Compensation from the Employer thereafter.

Early retirement benefit. A Participant or former Participant may elect to receive an early retirement benefit if he retires from all employment with the Employer when such Participant's or former Participant's attained age and Years of Vesting Service, when added together, equal or exceed 80 or more. The early retirement benefit shall be paid in the following form, unless the Participant or former Participant elects an optional form under § 58-20: a series of equal monthly payments beginning on the first day of the month following retirement and ending on the first day of the month following the month during which the recipient's death occurs, in an amount equal to 1.5% of his Final Average Monthly Compensation, multiplied by his Years of Benefit Accrual Service as of the date of retirement. Notwithstanding the foregoing, a Participant who retires from all employment with the Employer on or after December 1, 2004, when such Participant's attained age and Years of Vesting Service, when added together, equal or exceed 80 or more, shall be eligible to receive an early retirement benefit in an amount equal to 2% of his Final Average Monthly Compensation multiplied by his Years of Benefit Accrual Service as of the date of retirement.

Disability retirement benefit.

A Participant or former Participant who becomes Disabled may elect to receive a disability retirement benefit if the condition which renders him Disabled commences while he is in the employ of the Employer (whether as a Qualified Employee or otherwise). The disability retirement benefit shall be paid in a series of equal monthly payments beginning on the first day of the month following the month in which the recipient demonstrates to the satisfaction of the Committee that he is Disabled and ending on the earlier of (a) the first day of the month following the month during which the recipient's death occurs, or (2) the first day of the month following the month during which the recipient ceases to be Disabled. The amount of each monthly payment shall be such that if the disability retirement benefit were paid until the death of the recipient, the disability retirement benefit would be of Equivalent Actuarial Value to a series of equal monthly payments beginning on the first day of the month following the later of the month the recipient would attain age 65 or the month the recipient would first have seven Years of Vesting Service had he continued in the employ of the Employer until such time, and continuing until the first day of the month following the month during which the recipient's death occurs, in an amount equal to 1.5% of the recipient's Final Average Monthly Compensation, multiplied by his Years of Benefit Accrual Service as of the Qualification Date. Notwithstanding the foregoing, a Participant who becomes disabled on or after December 1, 2004, shall be eligible to receive a disability retirement benefit in an amount equal to 2% of his Final Average Monthly Compensation multiplied by his Years of Benefit Accrual Service as of the Qualification Date.

A person shall be ineligible to receive any other benefit under this Plan during any period in which he is Disabled if he elects to receive the disability retirement benefit.

If a person who received a Disability Retirement Benefit ceases to be Disabled and does not immediately thereafter return to the employ of the Employer, the amount of any benefit the person may be entitled to receive under this Plan with respect to the period before he ceased to be Disabled shall be reduced by the Equivalent Actuarial Value of the disability retirement benefit paid to him.

If a person who received a disability retirement benefit ceases to be Disabled and immediately thereafter returns to the employ of the Employer, the amount of any benefit the person may be entitled to receive under this Plan shall be reduced by the Equivalent Actuarial Value of the disability retirement benefit paid to him. Notwithstanding the preceding sentence, if such a person's total benefits under this Plan would have been greater if he were treated as having failed to immediately return to the employ of the Employer after he ceased to be Disabled (so as to suffer a Disqualifying Event) and as then becoming a new employee of the Employer upon his return, he shall be so treated.

Vested benefit.

In general. A Participant or former Participant who suffers a Disqualifying Event at a time when he is not eligible to receive a normal retirement benefit, deferred retirement benefit or early retirement benefit will be entitled to a vested benefit under this Plan if he has seven or more Years of Vesting Service as of the date of the Disqualifying Event. If he has fewer than seven Years of Vesting Service as of such date, he shall not be entitled to any benefits under this Plan for the period covered by those Years of Vesting Service, except as provided in Subsection G of this § 58-19.

Normal vested benefit. Unless the former Participant makes an election under Subsection E(3) to receive an early vested benefit, a former Participant entitled to receive a vested benefit shall receive his benefit as a normal vested benefit. A normal vested benefit shall be paid in the following form: equal monthly payments commencing on the first date a normal retirement benefit (see Subsection A) could have commenced if the former Participant had continued in the employ of the Employer until he was entitled to receive a normal retirement benefit, and continuing until the first day of the month following the month during which his death occurs, in an amount equal to 1.5% of his Final Average Monthly Compensation, multiplied by his Years of Benefit Accrual Service as of the date of his Disqualifying Event for a Disqualifying Event that occurred prior to December 1, 2004, or an amount equal to 2% of his Final Average Monthly Compensation multiplied by his Years of Benefit Accrual Service as of the date of his Disqualifying Event for a Disqualifying Event that occurs on or after December 1, 2004.

Early vested benefit. A former Participant entitled to receive a vested benefit may elect to receive an early vested benefit rather than a normal vested benefit under Subsection E(2) at any time after he attains age 55, provided that he had at least 25 Years of Vesting Service at the time of his Disqualifying Event. An early vested benefit shall be paid in the following form: a series of equal monthly payments beginning on the first day of the second month following the election and continuing until the first day of the month following the month during which the recipient's death occurs, in an amount such that the early vested benefit is of Equivalent Actuarial Value to the normal vested benefit the recipient would otherwise have received under Subsection E(2).

Cash-out of vested benefit. Notwithstanding the provisions of Subsection E(2) and (3), if the Equivalent Actuarial Value of a former Participant's normal vested benefit is $5,000 or less, the Committee may pay such Equivalent Actuarial Value to the former Participant in a lump sum at any time after his Disqualifying Event in lieu of any normal vested benefit or early vested benefit. Effective for distributions after March 28, 2005, the Participant must consent to any distribution under this § 58-19E(4) if the Equivalent Actuarial Value of the former Participant's normal vested benefit is greater than $1,000 but less than or equal to $5,000.

Death benefits.

Person eligible for early retirement. If a Participant or former Participant dies while in the employ of the Employer (whether as a Qualified Employee or otherwise) at a time when he could have elected to receive an early retirement benefit (see Subsection C) but would not have been entitled to a normal retirement benefit (see Subsection A), benefits shall be paid to his surviving spouse (if any) as if the Participant or former Participant had retired on the day before his death, elected on the day before his death to receive an early retirement benefit in the form of a joint and survivor annuity (see § 58-20A), and designated his spouse as the contingent annuitant.

Person eligible for normal retirement. If a Participant or former Participant dies while in the employ of the Employer (whether as a Qualified Employee or otherwise) at a time when he could have retired and received a normal retirement benefit (see Subsection A) or deferred retirement benefit (see Subsection B), benefits shall be paid to his designated contingent annuitant (or, if none has been designated or survives him, his surviving spouse, if any) as if he had retired on the day before his death and elected to receive his benefits in the form of a joint and survivor annuity (see § 58-20A). Notwithstanding the foregoing, if the Participant or former Participant had filed an election before his death to receive future Plan benefits in the ten-year certain form (see § 58-20B), and if any of his contingent annuitants shall survive him, benefits shall instead be paid to his contingent annuitants as if he had retired on the day before his death and elected to receive his benefits in the ten-year certain form.

Vested employee not eligible for early or normal retirement. If, after October 1, 1995, a Participant or former Participant dies at a time when he has credit for at least seven Years of Vesting Service, but would not have been entitled to elect to receive an early retirement benefit (see Subsection C) or a normal retirement benefit (see Subsection A), benefits shall be paid to his surviving spouse (if any) as follows: a series of equal monthly payments beginning on the first day of the month following the date the (former) Participant would have attained the age 55 [or, if the (former) Participant had already attained age 55 by the time of his death, beginning on the first day of the month following the date of the (former) Participant's death], and continuing until the first day of the month following the month during which the surviving spouse's death occurs, in an amount equal to the monthly payments that the surviving spouse would receive as the survivor annuitant under the following hypothetical annuity:

A joint and survivor annuity in a series of equal monthly payments commencing on the date the spousal benefits are to commence under this Subsection F(3), payable to the (former) Participant throughout his life and payable after his death to his surviving spouse's death, which is of Equivalent Actuarial Value to an annuity for the life of the (former) Participant in a series of equal monthly payments beginning on the first day of the month following the month in which the (former) Participant would have attained age 65 and continuing until the first day of the month following the month during which his death occurs, in a monthly amount equal to 1.5% of the (former) Participant's Final Average Monthly Compensation with respect to determinations made prior to December 1, 2004, multiplied by his Years of Benefit Accrual Service as of the date he actually died, or 2% of the (former) Participant's Final Average Monthly Compensation with respect to determinations made on or after December 1, 2004, multiplied by his Years of Benefit Accrual Service as of the date he actually died. [In calculating the value and amount of the payments to be made under a life annuity or joint and survivor annuity, it is necessary to make assumptions about the life expectancies of the annuitants. Therefore, for purposes of these hypothetical annuities, the life expectancy of the (former) Participant at the commencement of these annuities shall be determined in accordance with the Plan's actuarial mortality assumptions, without considering the fact that the (former) Participant has already died. However, once the amount of benefit payments are calculated under these annuities, it shall be recognized that the (former) Participant actually died before payments began, so that all benefits will be paid to his surviving spouse as the survival annuitant.]

Return of employee contributions.

In general. If no death benefits are payable under Subsection F(1) through (3) with respect to a Participant or former Participant as a result of his death (including the situation where no death benefits are payable thereunder because there is no surviving spouse or children), and the Participant or former Participant did not receive any payments from this Plan under a normal retirement benefit, deferred retirement benefit, early retirement benefit, disability retirement benefit, normal vested benefit, early vested benefit, or a return of employee contributions under Subsection G, below, the Plan shall pay a benefit to the beneficiary designated by the Participant or former Participant equal to the amount of all employee contributions made to the Plan by the Participant or former Participant under § 58-23A, if any, plus interest. The payment will be made in a lump sum cash distribution as soon as practicable after the death of the Participant or former Participant. If the Participant or former Participant failed to designate a beneficiary, or if no designated beneficiary shall have survived the Participant or former Participant, the benefit under this subsection shall be paid to the estate of the Participant or former Participant.

Interest. For purposes of Subsection F(4)(a), the term "interest" shall mean interest from the date of contribution to the date of distribution at the interest rate set forth in the definition of "Equivalent Actuarial Value" in § 58-16, as amended from time to time. (If the interest rate is amended, the interest rate in effect before the amendment shall be applicable in computing interest for the period before the effective date of the amendment, and the interest rate in effect after the amendment shall be applicable in computing interest for the period after the effective date of the amendment).

No other death benefits. Except as provided in this Subsection F and in § 58-20 (relating to elections to receive benefits in the form of a joint and survivor annuity or a ten-year certain form), no Participant or former Participant, and no estate or beneficiary of any Participant or former Participant, shall receive any payment or benefit under this Plan or from the Trust due to the death of a Participant or former Participant. Notwithstanding the foregoing, effective January 1, 2007, if a Participant dies while performing qualified military service [as defined in Section 414(u) of the Code], the Participant's beneficiary shall be entitled to additional benefits (including benefit accruals relating to the period of qualified military service), if any, that would be provided under the Plan had the Participant resumed employment with the Township and then terminated employment on account of death.

(6)

Beneficiary designations.

Except as provided in Subsection F(6)(b), a Participant or former Participant may only designate his surviving spouse and/or one or more of his children as a contingent annuitant (death beneficiary) of any benefit under this Plan, or any form of benefit under § 58-20. If there is no surviving spouse or child, no benefits shall be paid under this Plan after the death of the Participant or former Participant, other than any benefits provided under Subsection F(4) of this § 58-19.

For the limited purposes of Subsection F(4) of this § 58-19 (relating to return of employee contributions) only, a Participant or former Participant may designate any person or persons as his death beneficiary and may designate both primary and contingent beneficiaries.

Return of employee contributions.

In general. A Participant or former Participant who suffers a Disqualifying Event at a time when he is not eligible to receive any benefits under Subsections A through F of this § 58-19, or a Participant or former Participant who irrevocably waives any and all benefits under Subsections A through F of this section, will be entitled to a return of all employee contributions he made to the Plan under § 58-23A, if any, plus interest. The payment will be made in a lump sum cash distribution as soon as practicable after the Participant or former Participant files an election to receive a return of contributions.

Interest. For purposes of Subsection G(1) the term "interest" shall mean interest from the date of contribution to the date of distribution at the interest rate set forth in the definition of "Equivalent Actuarial Value" in § 58-16, as amended from time to time. (If the interest rate is amended, the interest rate in effect before the amendment shall be applicable in computing interest for the period before the effective date of the amendment, and the interest rate in effect after the amendment shall be applicable in computing interest for the period after the effective date of the amendment).

§ 58-20 Optional forms of benefits.

Joint and survivor annuity. A Participant or former Participant entitled to receive a normal retirement benefit, a deferred retirement benefit or an early retirement benefit may elect to receive such benefit in the form of a joint and survivor annuity rather than in the form specified in the applicable subsection of § 58-19 (life annuity form). A joint and survivor annuity is a series of equal monthly payments commencing on the date the life annuity form would commence, payable to the former Participant throughout his life and payable after his death to his designated contingent annuitant (if the contingent annuitant shall survive the former Participant) until the first day of the month of the contingent annuitant's death, and of Equivalent Actuarial Value to the life annuity form. For purposes of the joint and survivor annuity option, only one contingent annuitant may be designated, and only persons permitted under § 58-19F(6) may be designated.

Ten-year certain. A Participant or former Participant entitled to receive a normal retirement benefit, a deferred retirement benefit or an early retirement benefit may elect to receive such benefit in the form of a ten-year certain annuity rather than in the form specified in the applicable subsection of § 58-19 (life annuity form). A ten-year certain annuity is a series of equal monthly payments commencing on the date the life annuity form would commence, payable to the former Participant throughout his life and, in the event of his death before he receives 120 monthly payments, payable after his death to his designated contingent annuitants (if living) until a total of 120 monthly payments have been made to the former Participant and his contingent annuitants, and of Equivalent Actuarial Value to the life annuity form. For purposes of the ten-year certain option, only persons permitted under § 58-19F(6) may be designated as contingent annuitants.

§ 58-21 Limitation on benefits.

Defined benefit dollar limitation. The defined benefit dollar limitation is $195,000, as adjusted, effective January 1 of each year, under Code Section 415(d) in such manner as the Secretary shall prescribe, and payable in the form of a straight life annuity. A limitation as adjusted under Code Section 415(d) will apply to limitation years ending with or within the calendar year for which the adjustment applies.

Defined benefit compensation limitation. The "defined benefit compensation limitation" is the Participant's or former Participant's high three-year average compensation. In the case of a Participant who has had a severance from employment, the defined benefit compensation limitation applicable to the Participant in any limitation year beginning after the date of severance from employment shall be automatically adjusted by multiplying the limitation applicable to the Participant in the prior limitation year by the annual adjustment factor under Code Section 415(d).

High three-year average compensation. The average compensation for the three consecutive calendar years of service with the Employer that produces the highest average. In the case of a Participant who is rehired by the Employer after a severance from employment, the Participant's high three-year average compensation shall be calculated by excluding all years for which the Participant performs no services for and receives no compensation from the Employer (the break period) and by treating the years immediately preceding and following the break period as consecutive. For purposes of this § 58-21, a Participant's compensation shall mean wages, within the meaning of Code Section 3401(a), and all other payments of compensation to an Employee by the company (in the course of the company's trade or business) for which the company is required to furnish the Participant a written statement under Code Sections 6041(d), 6051(a)(3) and 6052. Compensation shall be determined without regard to any rules under Code Section 3401(a) that limit the remuneration included in wages based on the nature or location of the employment or services performed. Compensation paid or made available during a limitation year shall include amounts that would otherwise be included as compensation but for a Participant's election under Code Sections 125(a), 402(e)(3), 402(h)(1)(B), 402(k) or 457(b). Effective January 1, 2008, and solely for purposes of this § 58-21, compensation shall also include compensation paid by the later of 2 1/2 months after a Participant's severance from employment or the end of the calendar year that includes the date of the Participant's severance from employment, if the payment is regular compensation for service during the Participant's regular working hours, or compensation for services outside the Participant's regular working hours (such as overtime or shift differential), commissions, bonuses, or other similar payments, and, absent a severance from employment, the payments would have been paid to the Participant while the Participant continued in employment with the Employer. Any payments not described above shall not be considered compensation if paid after severance from employment, even if they are paid by the later of 2 1/2 months after the date of severance from employment or the end of the calendar year that includes the date of severance from employment. Back pay, within the meaning of Treas. Reg. Section 1.415(c)-2(g)(8), shall be treated as compensation for the calendar year to which the back pay relates to the extent the back pay represents wages and compensation that would otherwise be included under this definition. A Participant's compensation for a calendar year of service shall not include compensation in excess of the limitation under Code Section 401(a)(17) that is in effect for the calendar year in which such year of service begins.

Maximum permissible benefit. The "maximum permissible benefit" is the lesser of the defined benefit dollar limitation or the defined benefit compensation limitation (both adjusted where required, as provided in Subsection E and, if applicable, in Subsections F or G, below). Notwithstanding anything to the contrary contained in this Plan, when expressed as a monthly pension in the form of a straight life annuity (with no ancillary benefits) over the life of a Participant or former Participant, a pension benefit hereunder shall not exceed the lesser of (1) the defined benefit dollar limitation divided by 12, or (2) 100% of the participants monthly defined benefit compensation limitation. The maximum shall apply to any pension payable to the Participant or former Participant as a joint and survivor annuity without any actuarial reduction.

If the participant has fewer than 10 years of participation in the plan, the defined benefit dollar limitation shall be multiplied by a fraction, the numerator of which is the number of years (or part thereof) of participation in the plan, and the denominator of which is 10. In the case of a participant who has fewer than 10 years of service with the employer, the defined benefit compensation limitation shall be multiplied by a fraction, the numerator of which is the number of years (or part thereof) of service with the employer, and the denominator of which is 10.

If the benefit of a participant begins prior to age 62, the defined benefit dollar limitation applicable to the participant at such earlier age is an annual benefit payable in the form of a straight life annuity beginning at the earlier age that is the actuarial equivalent of the defined benefit dollar limitation applicable to the participant at age 62 (adjusted under Subsection D above, if required). The defined benefit dollar limitation applicable at an age prior to age 62 is computed using a 5% interest rate and the applicable mortality table as defined in Rev. Rul. 2001-62 or, for distributions prior to January 1, 2008, computed using the interest rate and mortality table (or other tabular factor) specified in the definition of "Equivalent Actuarial Value" in § 58-16 of the Plan if lesser. Any decrease in the defined benefit dollar limitation determined in accordance with this Subsection F shall not reflect a mortality decrement if benefits are not forfeited upon the death of the participant. If any benefits are forfeited upon death, the full mortality decrement is taken into account.

If the benefit of a participant begins after the participant attains age 65, the defined benefit dollar limitation applicable to the participant at the later age is the annual benefit payable in the form of a straight life annuity beginning at the later age that is actuarially equivalent to the defined benefit dollar limitation applicable to the participant at age 65 (adjusted under Subsection D above, if required). The actuarial equivalent of the defined benefit dollar limitation applicable at an age after age 65 is computed using a 5% interest rate assumption and the applicable mortality table as defined in Rev. Rul. 2001-62 or, for distributions prior to January 1, 2008, computed using the interest rate and mortality table (or other tabular factor), specified in the definition of "Equivalent Actuarial Value" in § 58-16, of the Plan if lesser. For these purposes, mortality between age 65 and the age at which benefits commence shall be ignored.

For all purposes of this Plan, the maximum defined benefit dollar limitation shall be automatically increased as permitted by Treasury Department regulations to reflect cost-of-living adjustments. As a result of such an adjustment, a pension which had been limited by the provisions of this § 58-21 in a previous plan year may be increased with respect to future payments to the lesser of the adjusted defined benefit dollar limitation amount or the amount of pension which would have been payable under this Plan without regard to the provisions of this § 58-21.

The limitations described in this § 58-21 are intended to comply with the provisions of Code Section 415, as amended, so that the maximum benefits provided by plans of the Employer shall be exactly equal to the maximum amounts allowed under Code Section 415 and the regulations issued thereunder. If there is any discrepancy between the provisions of this § 58-21 and the provisions of Code Section 415 and the regulations issued thereunder, such discrepancy shall be resolved in such a way as to give full effect to the provisions of Code Section 415 and the regulations issued thereunder.

§ 58-22 Benefits: miscellaneous provisions.

Accrued benefit.

The accrued benefit as of any given date ("calculation date") of a Participant or former Participant who has never suffered a Disqualifying Event or who has returned to employment with the Employer since his most recent Disqualifying Event, and who is not yet qualified to receive any Plan benefits with respect to his current period of employment if he terminates his employment with the Employer, shall be an amount equal to:

The Equivalent Actuarial Value as of the calculation date of an annuity of equal monthly payments commencing on the first date a normal retirement benefit would commence if the Participant or former Participant continues in the employ of the Employer until he is entitled to receive a normal retirement benefit with respect to his current period of employment, and continuing until the first day of the month following his death, in an amount equal to 1.5% of his Final Average Monthly Compensation, multiplied by his number of Years of Benefit Accrual Service as of a calculation date prior to December 1, 2004, and 2% of his Final Average Monthly Compensation multiplied by his number of Years of Benefit Accrual Service as of a calculation date after December 1, 2004; plus

The Equivalent Actuarial Value as of the calculation date of all Plan benefits to which the Participant or former Participant is entitled for periods of service ending on or before the date of any Disqualifying Event which occurred before the calculation date; less

(c)

The Equivalent Actuarial Value of all Plan benefits which have already been paid.

The accrued benefit as of any given date ("calculation date") of a Participant or former Participant other than a person described in Subsection A(1) shall be an amount equal to the Equivalent Actuarial Value as of the calculation date of all Plan benefits which the Participant or former Participant is entitled to receive at any time, assuming for such purposes that any such Participant or former Participant who has never suffered a Disqualifying Event or who has returned to employment with the Employer since his most recent Disqualifying Event terminates his employment with the Employer on the calculation date, less the Equivalent Actuarial Value of all Plan benefits which have already been paid.

Production of information. Before any payment shall be made under this Plan to or on account of a Participant or former Participant, the recipient of such payment shall file with or make available to the Committee such information as the Committee may from time to time require to determine the recipient's rights and benefits under the Plan.

Notice of benefit options. The Committee shall provide a Participant or former Participant with written notice of the benefit options which are available to him under the Plan and of the procedures for obtaining such benefits within a reasonable time after the Participant or former Participant expresses an interest in retirement, and also approximately three months before the Participant or former Participant would first become eligible to receive a normal retirement benefit.

Election of benefits and benefit options. All applications for benefit payments, elections to receive optional forms of benefits, and beneficiary (contingent annuitant) designations shall be made on forms supplied by the Committee and within such reasonable periods of time as may be prescribed by the Committee. The time provided in this Plan for the commencement of any benefits shall be subject to compliance with the requirements of Subsection B and this Subsection D

No benefit increases following termination. The amount of benefits to which a Participant or former Participant may be entitled under this Plan with respect to any continuous period of employment with the Employer (whether as a Qualified Employee or not) or any consecutive periods of employment in which a Disqualifying Event has not occurred between the beginning of the first of such periods and the day before the end of the last of such periods, shall be determined in accordance with the provisions of the Plan in effect on the last day in which the Participant or former Participant worked for the Employer during such period or during the last of such consecutive periods. Such amount shall not be affected by benefit increases which become effective thereafter.

Latest commencement of benefits. Notwithstanding anything to the contrary in this Plan, distribution of benefits under this Plan with respect to any Participant or former Participant shall commence no later than the later of:

April 1 of the calendar year following the calendar year in which the Participant or former Participant attains age 70 1/2; or

April 1 of the calendar year following the calendar year in which the Participant or former Participant ceases to be employed by the Employer.

Compliance with Code Section 401(a)(9). Notwithstanding anything to the contrary contained in this Plan, all distributions of Plan benefits must comply with the provisions of Code Section 401(a)(9) (or any successor provision) and the regulations issued thereunder, and the incidental death benefit rules of the Internal Revenue Service. If a form of benefits (including the selection of a beneficiary/contingent annuitant) elected by a Participant or former Participant would violate those provisions, regulations or rules, but another form is available under the terms of this Plan which would not, the Participant or former Participant must elect a form which would not violate those provisions, regulations or rules. Otherwise, the optional forms of benefits available under this Plan shall be modified as follows, to the extent necessary to comply with those provisions, regulations and rules:

A joint and survivor annuity form may be altered by reducing the monthly amount under the survivor annuity below 100% of the monthly amount paid during the former Participant's life;

A ten-year certain form may be altered by reducing the duration of the period certain.

Direct rollover.

Notwithstanding any provision of the Plan to the contrary that would otherwise limit a distributee's election under this section, a distributee may elect, at the time and in the manner prescribed by the Administrator, to have any portion of an eligible rollover distribution that is equal to at least $500 paid directly to an eligible retirement plan specified by the distributee in a direct rollover.

For purposes of this section, the following definitions shall apply:

An "eligible rollover distribution" is any distribution of all or any portion of the balance to the credit of the distributee, except that an eligible rollover distribution does not include: any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee's designated beneficiary, or for a specified period of 10 years or more; any distribution to the extent such distribution is required under Code Section 401(a)(9); the portion of any other distribution that is not includible in gross income (determined without regard to the exclusion for net unrealized appreciation with respect to employer securities); any hardship distribution described in Code Section 401(k)(2)(B)(i)(IV) made after December 31, 1999; and any other distribution that is reasonably expected to total less than $200 during a year. Effective January 1, 2002, 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; provided, however, such portion may be transferred only to (i) an individual retirement account or annuity described in Section 408(a) or (b) of the Code; (ii) for taxable years beginning before January 1, 2007, 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 that is includible in gross income and the portion of such distribution that is not so includible; or (iii) for taxable years beginning after December 31, 2006, a qualified trust or to an annuity contract described in Section 403(b) of the Code if such trust or contract provides for separate accounting for amounts so transferred (including interest thereon), 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.

An "eligible retirement plan" is an individual retirement account described in Code Section 408(a), an individual retirement annuity described in Code Section 408(b), an annuity plan described in Code Section 403(a), or a qualified trust described in Code Section 401(a), that accepts the distributee's eligible rollover distribution. However, in the case of an eligible rollover distribution to the surviving spouse, an "eligible retirement plan" is an individual retirement account or individual retirement annuity. Effective for distributions made after December 31, 2001, an "eligible retirement plan" shall also mean an annuity contract described in Code Section 403(b) and an eligible plan under Code Section 457(b) 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. Effective for distributions made after December 31, 2001, an "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 relations order, as defined in Code Section 414(p). Effective January 1, 2008, an eligible retirement plan shall also mean a Roth IRA described in Code Section 408A.

(c)

A "distributee" includes an Employee or former Employee. In addition, the Employee's or former Employee's surviving spouse and the Employee's or former Employee's spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in Code Section 414(p), are distributees with regard to the interest of the spouse or former spouse. Effective for distributions made on or after January 1, 2010, "distributee" shall also mean the Employee's nonspouse designated beneficiary; provided, however, that the direct rollover for a nonspouse designated beneficiary may be made only to an individual retirement account or annuity described in Code Sections 408(a) or 408(b) that is established on behalf of the Employee's nonspouse designated beneficiary and that will be treated as an inherited IRA pursuant to the provisions of Code Section 402(c)(11).

(d)

A "direct rollover" is a payment by the Plan to the eligible retirement plan specified by the distributee.

§ 58-23 Employer and employee contributions.

Employee contributions. From January 1, 1994, to January 1, 1997, each Participant contributed an amount equal to 1% of his Compensation to the Trust. The contributions under this Subsection A shall be paid by having the Employer pay each Participant only 99% of the amount of Compensation he/she would otherwise receive in each paycheck. Although all contributions under this Subsection A are hereby designated as employee contributions, they shall be made through salary reductions and thus paid by the Employer as "pick up" contributions under Code Section 414(h)(2) so that they are not subject to federal income tax at the time of contribution, but only when Plan benefits are paid. (Note: although pick up contributions are not subject to current federal income tax, they are considered "wages" subject to current FICA taxation and also current income for Pennsylvania state and local income taxes.) A Qualified Employee shall not have the option of receiving the amount of employee contributions required under this Subsection A directly instead of having them paid by the Employer to the Plan. This subsection shall be construed to include all requirements necessary to satisfy the provisions of Code Section 414(h)(2).

Employee contributions — military service. Notwithstanding Subsection A, no Participant shall be required to make any contributions to this Plan during any period of service in the uniformed services of the United States. If such a Participant returns to employment with the Employer, he/she shall contribute to the Plan an amount equal to the rate in effect under Subsection A for the period of uniformed service multiplied by the deemed Compensation of the Participant for such period. (Where more than one rate is in effect during the period of uniformed service, a calculation shall be performed for each portion of the period of uniformed service governed by a separate rate, and the total required contribution shall be equal to the sum of such calculations). The contribution shall be made during the period beginning with the date of reemployment and whose duration is the lesser of (1) three times the period of the person's service in the uniformed services, or (2) five years. If the Participant fails or refuses to make the contribution required under this Subsection B, he shall forfeit all benefits under this Plan which are based on service during the period for which the required employee contributions were not made.

Employer contributions. The Employer shall, from time to time, contribute to the Plan and Trust the amounts required to fund all the benefits provided under the Plan according to the calculations of the Pension Consultant, and as required by the Municipal Pension Plan Funding Standard and Recovery Act, 53 P.S. § 895.101 et seq. Employer contributions may be derived from grants of state aid, disbursements from the Township's general fund, and other sources.

Payment of contributions to trustee. All Employer contributions shall be paid to the Trustee to be held in the Trust. The Trust shall be used to pay all benefits under this Plan. Contributions under Subsection A shall be paid to the Trustee no later than 60 days after the date they would otherwise have been paid as Compensation to the Participant.

§ 58-24 Administration and management of Plan and Trust.

Administrative Committee.

The South Whitehall Township Pension Committee shall administer the South Whitehall Township Office Personnel Pension Plan, the South Whitehall Township Public Works Union Employees’ Pension Plan, and the South Whitehall Township Police Pension Plan and Trust. The Committee shall consist of a minimum of three persons and a maximum of seven persons. The members of the Committee shall serve at the pleasure of the Board of Commissioners, with appointments to the Committee being made by resolution of the Board of Commissioners from time to time. Any member of the Committee may resign by delivering his written resignation to the Commissioners and to the Committee.

[Amended 10-17-2012 by Ord. No. 961]

Organization and operation of the Committee. A majority of the appointed members of the Committee shall constitute a quorum for all actions taken by the Committee. Any such action may be taken either by vote at a meeting or in writing without a meeting. The Committee may authorize any one or more of its members to execute any document or documents on behalf of the Committee, in which event the Committee shall notify the Trustee in writing of such action and the name or names of its member or members so designated. Thereafter, the Trustee shall accept and rely upon any document executed by such member or members as representing action by the Committee until the Committee shall file with the Trustee a written revocation of such designation. The Committee may adopt such by-laws and regulations as it deems desirable for the conduct of its affairs, and may appoint such accountants, consultants, and other persons as it may deem necessary or desirable in connection with the administration of this Plan. The Committee shall be entitled to rely exclusively upon, and shall be fully protected in any action taken by it in good faith in relying upon, any opinions or reports which shall be furnished to it by any such accountant, counsel or other consultants.

Powers and duties. The Committee shall administer the Plan in accordance with its terms, shall direct the Trustee to make the benefit payments provided under this Plan, and shall have all powers necessary to carry out the provisions of the Plan. The Committee shall interpret the Plan and shall determine all questions arising in the administration, interpretation, and application of the Plan. Any such determination by the Committee shall be conclusive and binding on all persons.

Records and reports. The Committee shall keep a record of all its proceedings and acts, and shall keep all such books of account, records, and other data as may be necessary for the proper administration of the Plan. The Committee shall notify the Trustee and the Employer of any action taken by the Committee and, when required, shall notify any other interested person or persons.

Payment of expenses. Unless otherwise determined by the Commissioners, the members of the Committee shall serve without compensation for services as such, but all expenses of the Committee shall be paid by the Trust or the Employer in such manner as the Employer shall determine. Such expenses shall include any expenses incident to the functioning of the Committee, including but not limited to fees of accountants, counsel, consultants and other specialists, and any other costs of administering the Plan.

(6)

Immunity from liability; indemnification. No member of the Committee shall incur any liability for any action or failure to act except with respect to his own gross negligence or willful misconduct. The Employer shall and does hereby indemnify each member of the Committee against any and all claims, losses, damages, expenses and liabilities arising from any action or failure to act, except when the same is judicially determined to be due to the gross negligence or willful misconduct of such member. In addition, the Committee and any member or agent thereof shall be fully protected in relying upon the advice of any counsel, consultant or actuary appointed by the Committee or the Employer.

The trust.

In general. All of the funds of this Plan shall be held by a corporate trustee or trustees appointed by the Commissioners, in trust, in accordance with the terms of the Trust Agreement, as it may be amended from time to time. Said Trust Agreement is incorporated herein by reference. The Trust created or existing under the Trust Agreement shall be a part of this Plan for use in providing the benefits of this Plan and paying any expenses not directly paid by the Employer. Neither the Employer, the Committee, nor the Commissioners shall have any responsibility for the administration of the Trust funds or any liability for any loss with respect thereto.

Rights in Trust funds. No part of the corpus or income of the Trust shall be used for or diverted to purposes other than the exclusive benefit of Participants, former Participants, and contingent annuitants of this Plan prior to the satisfaction of all liabilities under this Plan with respect to such persons. No person shall have any interest in or right to any part of the earnings or assets of the Trust except as and to the extent expressly provided in this Plan and in the Trust Agreement.

Source of Plan benefits. The Trust is designed to be and shall be the sole source of the benefits provided under the Plan. The Employer does not guarantee such benefits or payments or assume any obligation with respect thereto other than to pay the contributions provided under § 58-23 into the Trust.

Trustee. The Commissioners hereby reaffirm the appointment of Wells Fargo Bank as Trustee of the Trust.

No funding by individual policies. The Plan shall not be funded on an individual insurance policy basis.

Pension Consultant. The Commissioners hereby appoint Conrad Siegel Actuaries as the Pension Consultant to the Plan and Trust to serve at the pleasure of the Commissioners.

Nondiscrimination. Whenever there is a choice or decision to be made by the Employer or the Committee in connection with the administration of the Plan, the result shall be uniformly applied then and thereafter in all similar circumstances so that there shall be no discrimination in the operation of the Plan.

§ 58-25 Amendment.

The Commissioners may by ordinance at any time and from time to time modify or amend, in whole or in part, any or all of the provisions of the Plan and/or Trust Agreement, including the method of financing the Plan, provided that:

No modification or amendment may be made which would have the effect of depriving any retired former Participant or contingent annuitant receiving a retirement benefit of any benefits under the Plan to which he would otherwise be entitled by reason of the accumulated funds held under the Plan at that time, unless such former Participant or contingent annuitant consents thereto;

No modification or amendment may be made which would cause the accrued benefit (see § 58-22A) of any Participant or former Participant to be lower at any time after the modification or amendment than it was immediately before the amendment, except that any portion of the accrued benefit which is attributable to a nonvested period may be reduced or eliminated as of any date after the end of such period. For purposes of the preceding sentence, a "nonvested period" shall mean any period of time ending with a Disqualifying Event and beginning the day after the previous Disqualifying Event (or, in the case of the period which ends with the first Disqualifying Event suffered by the Participant or former Participant, beginning the first day of employment with the Employer), provided that the Participant or former Participant had less than seven Years of Vesting Service as of the last day of the period;

No modification or amendment may be made which would increase the number of years specified in § 58-19E(1) to qualify for the vested benefit, or would otherwise change the vesting schedule of the Plan (currently 0% for six or fewer Years of Vesting Service and 100% for seven or more Years of Vesting Service) to the potential detriment of any Participant;

No such modification or amendment shall make it possible for any part of the funds of the Plan to be used for or diverted to purposes other than for the exclusive benefit of Participants, former Participants, and contingent annuitants under the Plan prior to the satisfaction of all liabilities with respect to them; and

No such modification or amendment shall make it possible for the Employer to appoint to the position of Trustee anyone other than a corporate trustee.

Notwithstanding the foregoing, any modifications or amendments of the Plan may be made by ordinance, retroactively if necessary, which the Commissioners may deem necessary or appropriate to make the Plan conform to the requirements of any law or governmental regulation now or hereafter enacted or promulgated, or to qualify the Plan and Trust as exempt under existing or future federal, state or local income tax or estate tax laws and regulations.

§ 58-26 Termination and merger.

Right of termination. Although the Employer expects and desires that this Plan shall be permanent, it reserves the right to terminate the Plan for any reason at any time and discontinue contributions to this Plan, to the extent permitted by state and federal law.

Use of funds upon termination. In case of termination of this Plan, all active Participants who are accruing benefits shall become fully vested in their accrued benefits and the funds of the Plan and Trust shall be used for the exclusive benefit of Participants, former Participants, and contingent annuitants to the extent of their rights under the Plan. However, if the Employer, because of erroneous actuarial calculations, shall have contributed funds in excess of the amount required to satisfy all liabilities of the Plan for benefits, then such excess shall be returned to the Employer.

Order of payments. In the event this Plan is terminated or the Employer discontinues making contributions to this Plan, the Committee shall determine the share of the funds of the Plan and Trust allocable to each Participant, former Participant, and contingent annuitant in the following order, except as may be required by rule, regulation or direction of the Internal Revenue Service, the Pension Benefit Guaranty Corporation, or the Pennsylvania Auditor General's office:

Any accrued benefits (see § 58-22A) that Participants, former Participants or contingent annuitants have accrued to the date of termination or discontinuance of contributions, to the extent that these benefits are then funded or credited to their individual accounts, shall be nonforfeitable and payable to them. If the funds of the Plan are insufficient to provide for all accrued benefits in full, each benefit shall be reduced pro rata.

To the extent that such accrued benefits are not funded or credited on an individual basis, they shall be payable in the following order:

Each retired former Participant or his contingent annuitant receiving a retirement benefit and each Participant or former Participant who has not yet retired from employment with the Employer but who is entitled to retire and receive a normal retirement benefit shall be entitled to a benefit equal to the reserve computed to be required to provide his full accrued benefits. If the funds of the Plan and Trust are insufficient to provide in full for all benefits under this Subsection C(2)(a), then all benefits under this Subsection C(2)(a) shall be reduced pro rata.

After the benefits under the provisions of Subsection C(2)(a) above have been set aside in full, each other person entitled to a benefit hereunder shall be entitled to a benefit equal to the reserve computed to be required to provide his accrued benefits. If the funds of the Plan and Trust are insufficient to prove in full for all benefits under this Subsection C(2)(b), then all benefits under this Subsection C(2)(b) shall be reduced pro rata.

Form of termination payments. To the extent permitted by law, the Committee may require that all assets of the Trust be paid following the termination of the Plan (or the complete discontinuance of Employer contributions to the Plan) in cash, in immediate annuities, in deferred annuities, or in other periodic payment forms, or in one of such forms permitted by the Committee and elected by the recipient.

Merger.

For purposes of this Subsection E, the term "merger" shall mean any merger or consolidation of this Plan and/or the Trust with any other plan, or any transfer of the assets or liabilities of this Plan and/or the Trust to any other plan.