Compensation Reduction Limitations Sample Clauses

Compensation Reduction Limitations. To insure continued qualification of the Plan, a test sometimes referred to as the “actual deferral percentage test” must be met for each Plan year. In order to meet the ADP test, it may be necessary to adjust contributions made by the Company resulting from the compensation reduction agreements entered into by certain of the participants. In the event that the contribution ratios of the Plan do not satisfy the test, the Administrative Committee shall adjust the contributions resulting from the compensation reduction agreements as follows effective January 1, 1997: (a) Any distribution under this Paragraph shall be made on or before the fifteenth (15th) day of the third (3rd) month following the end of the Plan year, but in no event later than the close of the following Plan year, which in this case is a calendar year, and shall be determined in the following manner: (i) The dollar amount of excess contributions for each highly compensated participant shall be calculated. (ii) The total of the dollar amounts in (i) shall be determined. (iii) The contributions resulting from the com-pensation reduction agreement (“elective contributions”) of the highly compensated participant with the highest dollar amount of elective contributions shall be reduced by the amount required to cause that highly com-pensated participant’s elective contributions to equal the dollar amount of the elective contributions of the highly compensated participant with the next highest dollar amount of elective contributions. This amount shall be distributed to the highly compensated participant with the highest dollar amount. However, if a lesser reduction, when added to the dollar amount already distributed under this (iii) would equal the total excess contributions, the lesser reduction amount shall be distributed. (iv) If the total amount distributed is less than the total excess contributions, reductions shall continue to be made in accordance with (iii) until the total amount distributed equals the total excess contributions. (b) For purposes of this Paragraph, income means the gain or loss allocable to excess contributions which shall equal the sum of the allocable gain or loss for the Plan year and the allocable gain or loss for the period between the end of the Plan year and the date of distribution (gap period). The income or loss allocable for the Plan year and the gap period is calculated separately and is determined by multiplying the income or loss for the Plan year and gap...