PLAN WITHDRAWALS AND INVESTMENT EXCHANGES. An investment contract generally imposes ongoing contractual commitments on the Plan to maintain the issuer's promise to pay the book value of the contract. If the sponsoring employer changes Plan rules in a manner which changes significantly the amount of "benefit-responsive" withdrawals from a contract, the issuer may be authorized to lower the interest rate or assess a monetary penalty. Alternatively, the issuer may refuse to pay withdrawals prompted by the plan change. Employer-initiated events such as a large scale layoff or a sale of part of the business may cause the same consequences. Early advance notice to Trustee of a coming Plan change or corporate event is critical to provide Trustee sufficient time to try to minimize any financial consequences to the Plan. A request by the Plan contract holder (sponsoring employer or trustee) to withdraw funds prior to the contract maturity date may also result in the assessment of a market value adjustment on the amount withdrawn. Some contracts don't allow such pre-maturity withdrawals without issuer consent. Due to the potential financial consequences to Plan participants in these types of situations, funding and withdrawal decisions must be carefully weighed by Plan sponsors, managers and trustees.
PLAN WITHDRAWALS AND INVESTMENT EXCHANGES. An investment contract generally imposes ongoing contractual commitments on the Plan to maintain the issuer's promise to pay the book value of the contract. If the sponsoring employer changes Plan rules in a manner which changes significantly the amount of "benefit-responsive" withdrawals from a contract, the insurer may be authorized to lower the interest rate or assess a monetary penalty. Alternatively, the insurer may refuse to pay withdrawals prompted by the plan change. Employer-initiated events such as a large scale layoff or a sale of part of the business may cause the same consequences. Early advance notice to FMTC of a coming Plan change or corporate event is critical to provide FMTC sufficient time to try to minimize any financial consequences to the Plan. A request by the Plan contractholder (sponsoring employer or trustee) to withdraw funds prior to the contract maturity date may also result in the assessment of a market value adjustment on the amount withdrawn. Some contracts don't allow such pre-maturity withdrawals without issuer consent. Due to the potential financial consequences to Plan participants in these types of situations, funding and withdrawal decisions must be carefully weighed by Plan sponsors, managers and trustees. The undersigned hereby acknowledges and agrees that it has read and understood the foregoing disclosures. FMC Corporation BY: /s/ Xxxxx X. Xxxxxxxxxxx --------------------------- Name: Title: Director, Benefits and Information Technology Date: 5/30/97 ----------------------- Schedule "J" [Sponsor's Letterhead] Xx. Xxxxxxx Xxxxxx Fidelity Investments Institutional Operations Company, Inc. 00 Xxxxxxxxxx Xxxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 [Name of Plan] Dear Xx. Xxxxxx: This letter is sent to you in accordance with Section 8(a) of the Trust Agreement dated as of the [_] day of [_], 199X, between [_] and Fidelity Management Trust Company. Each of the plans identified below is a tax-qualified defined contribution plan which meets the requirements of Section 17 of said Trust Agreement and which is maintained by the undersigned, or one of its subsidiaries or affiliates, for the benefit of their eligible employees. Each such plan is hereby designated as a "Plan" for purposes of said Trust Agreement. The following individuals or entities are the Administrator and Named Fiduciary (ies) of said Plan(s).
