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HomeMy WebLinkAbout1980 02 12-U.S. Conference of Mayors Deferred Compensation Program THE U. S. CONFERENCE OF MAYORS DEFERRED COMPENSATION PROGRAM THE CITY OF "i ••; ; EMPLOYEES DEFERRED COMPENSATION PLAN ADMINISTRATIVE SERVICE AGREEMENT • This Agreement effective as of 74'12 / L , 19 :'6 by and between the City of': -5 (the "City "), acting through its l-fi`4n(e_. on behalf of the City of i % ,�;,- ,` ,; S Employees Deferred Compensation Plan (the "Plan "), Nationwide Life Insurance Company of Columbus, Ohio ( "Nationwide "), and Public Employees Benefit Services Corporation, of 0 :clahoma City, Oklahoma ( "PEBSCO "). Whereas, the City has established for the employees an "Eligible Deferred Compen- sation Plan," as defined by Section 457 of the Internal Revenue Code; and Whereas, the U. S. Conference of Mayors has received an affirmative Opinion of Counsel that its prototype plan as provided the City as part of the U. S. Con- . ference of Mayors Deferred Compensation Program, is in conformance with Section 457 of the Internal Revenue Code; and • Whereas, PEBSCO proposes to accept the responsibility of Plan Coordinator, to include the employee communication, enrollment of employee- participants, and the performance of certain administrative payroll services; and Whereas, Nationwide proposes to issue to the City its Group Retirement Fund Contract to fund the Plan and to perform certain administrative services; Now, therefore, in consideration of the promises contained herein, the parties hereby mutually agree as follows: 1. -Acceptance of Contract. The City hereby submits the Application attached a Y hereto as Exhibit A, and accepts Nationwide's Group Retirement Fund Contract (the "Contract "), a specimen copy of which is attached hereto as Exhibit B. The City shall be sole applicant for and owner of the Contract. The Contract shall be the only group annuity contract offered under the Plan during the term of this Agreement except as otherwise mutually agreed in writing between the City, PEBSCO, and Nationwide. The City further appoints PEBSCO as the Plan Coordinator, charged with the duties and responsibilities set forth hereinbelow. 2. Performance Required of PEBSCO. a. PEBSCO will provide the necessary technical assistance to the City's payroll director and personnel to coordinate an administrative system 'compatible with the current structure of PEBSCO's payroll system. b. PEBSCO will assist the City in establishing procedures for payroll re- ductions to accurately reflect the deferral of compensation by Partici- pants and for the transmission of such deferred amounts for investment in the Nationwide Contract. c. PEBSCO will reconcile the monies received to the detail data of partici- pants upon receipt of the deferrals and reduction data for participants from the City. d. PEBSCO will instruct the depository agent to transmit amounts deferred to Nationwide, on a monthly basis for investment credit. e. PEBSCO will send to Nationwide a computer - readable tape of the detailed data of the Participants whose deferrals are represented by such deposit. PEBSCO shall safeguard the confidentiality of all Participant lists and payroll data. f. PEBSCO will be responsible for the enrollment and for the explanation of participation . in the Plan and Nationwide's Contract to all participants. As part of this function, PEBSCO will conduct group presentations for the.City's employees to explain the tax consequences as well as the re- strictions as contained under Section 457 of the Internal Revenue Code. During the meeting, PEBSCO will answer any questions about the Plan and the Nationwide Contract. PEBSCO personnel will also meet individually with interested employees to answer questions and to assist in the com- pletion and filing of Participation Agreements with the Plan Coordinator and the City's payroll department. g. PEBSCO will, with information provided by Nationwide, prepare any necessary promotional materials for distribution to the City's employees, which materials shall be submitted to Nationwide for approval prior to use. The City reserves the right to review and modify any promotional • materials. • • h. PEBSCO will answer any questions for the City's payroll department through its national service operations facility, with a toll -free telephone number. i. • PEBSCO agrees to indemnify and hold harmless the City and its individual officials for any loss arising from its failure to perform its duties and services pursuant to the Agreement. • • j. In the event MMBSCJ fails to perform any of its duties pursuant to the terms of this agreement, the City has the option to terminate this agreement upon 30 days written notice to PEBSCO of its intent to terminate. 3. Performance Required of the City. a. The City will provide the necessary support and cooperation to the program so that all City employees will have the'opportunity to participate in the Plan. b. The City will provide PEBSCO with the necessary data and support for the • development and coordination of the administrative system for the operation and maintenance of the Plan. c. The City will transmit the deferred amounts to the depository agent, and supporting documents detailing the individual Participant deferrals to PEBSCO, promptly after each pay period for processing. The City will authorize PEBSCO to instruct the depository agent to transmit the deferred amounts to Nationwide on a monthly basis, once the amounts are reconciled to the payroll reduction data. d. The City agrees that, after the crediting by Nationwide to the City of the gross interest rate on the funds deposited in the Contract, and prior to the crediting of the net interest rate to the accounts of Participants, the City shall authorize Nationwide to pay, on its behalf, to PEBSCO, an administrative fee equal, on an annual basis, to 0.35% of the City's funds held under the Nationwide Contract, as compensation for PEBSCO's services as set forth above. The payment of such fees to PEBSCO shall be on an annual basis. 4. Performance Required of Nationwide. a. Nationwide agrees to accept contributions under the Contract from the City through the depository agent. Participant payments will be accompanied by appropriate documentation on computer- readable tape(s) from PEBSCO. Nationwide agrees that its procedures for receipt of funds, maintenance of accounts and disbursements of funds will he compatible with the pro- visions of the Plan Agreement or any amendments hereto made necessary for the Plan to maintain its tax - favored status. b. Nationwide will maintain an individual account in respect of each Parti- cipant, whose deferrals are deposited in the Nationwide Contract and will provide an annual individualized statement to each Participant, reflecting both total contributions and accumulated value. Nationwide will also pro- vide to the City an annual statement listing individual Participant account values and total Contract value. c. Nationwide will provide a special report prepared by an independent public accounting firm concerning the financial data of the U. S. Conference Program. d. Nationwide agrees to disburse contract benefit amounts as provided for by Participant elections under the Plan Agreement and the Contract, as directed by the City from time to time and communicated to Nationwide by the City or the Plan Coordinator, and to provide information at source reporting as may be required by the Internal Revenue Service. e. Nationwide will establish a full service operations facility, with a toll - free telephone number, to provide a full range of Participant services. f. Nationwide agrees to indemnify and hold harmless the City and its indivi- dual officials for any loss arising from its failure to perform its duties and service pursuant to the Agreement. 5. Term and Renewal. This Agreement shall be for a term of sixty (60) months from the effective date and shall be renewable by the City at the end of the original term, or at the end of any renewable term, by the City notifying Nationwide and PEBSCO within six (6) months of the end of such term of its intention to renew the Agreement; and if within three (3) months of the end of any term, the City has failed to affirmatively renew the Agreement, but has not provided Nationwide and PEBSCO with written notice of termination, the Agreement shall automatically renew for an Additional thirty -six (36) months; provided, however, that Nationwide and PEBSCO must accept in writing, the affirmative or automatic renewal of the Agreement, within twenty (20) days of such occurrence, in which case the renewal provisions of this paragraph shall apply as if the Agreement was in the last year of its term. The City agrees that in the event of the non - renewal of this Agreement, all contributions invested by it under Nationwide's Contract, shall remain with Nationwide until disbursed to the Participant or his beneficiary in accord- ance with the Plan Agreement. The City further agrees that in the event of non - renewal of this Agreement that it will not require those Participants whose deferred compensation has been invested by the City in Nationwide's Contract to change their investment index under the Plan Agreement, though the City may permit the Participant to select alternative investment indexes prospectively under the Plan Agreement. 6. Entire Agreement. This Agreement, along with the Contract, constitutes the entire agreement between the parties and there are no other agreements, except a General Agent Appointment and Administrative Service Agreement between Nationwide and PEBSCO. 7. Applicable Law. This Agreement shall be construed in accordance with the laws of the State of = L I_ . ; >:y 8. Effective Date. This Agreement shall be effective as of / 19 IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement this day of ,19 City of WINTER SPRINGS, FLORIDA By I Ae•/ Troy .. Title: MAYORI Nationwide Life Insurance Company Public Employees Benefit Services Corporation By By 460414444=W Vice President Title: Vice President ), ; e • • • I _ J r U.S. CONFERENCE OF MAYORS DEFERRED COMPENSATION PROGRAM THE DEFERRED COMPENSATION PLAN FOR PUBLIC EMPLOYEES � L� �',�'iniG The ' i hereby accepts. �� j i C;��� �ir% the U.S. Conference of Mayors deferred compensation program and adopts and establishes the CT;' dr /1.)44/ - Deferred Compen- sation Plan for Public Employees, (hereinafter called the Plan). The Plan consists of the provisions set forth in this document, and is applicable to each public employee who elects to participate in the Plan. The Plan is effective as to each such public employee upon the date he becomes a "PARTICIPANT" by signing and filing the Participation Agreement referred to herein with the Administrator. ARTICLE I Definitions 1.01. A definition of words and terms used in this Plan is attached, entitled Exhibit "A ", and by this reference is made a part of the Plan. ARTICLE II . Election to Defer Unearned Compensation 2.01. Compensation will be deferred for any calendar month only if an agreement providing for such deferral is entered into before the beginning of such month. l9, -L- 2.02. Upon signing the Participation Agreement, the PARTICI- PANT elects to participate in this Plan and consents to the EMPLOYER deferring the amount specified in the Participation Agreement from the PARTICIPANT'S gross compensation for each pay period. The dollar amount deferred ( "deferred amount ") must equal at least $20 per month. 2.03. The PARTICIPANT may revoke his election to participate and may amend the amount of compensation to be deferred on his investment specification by signing and filing with the Adminis- trator a written revocation or amendment on a form and in the procedural manner approved by the Administrator. Any such revo- cation or amendment shall be effective prospectively only, and shall cause no change in the allocation of amounts invested prior to the filing date of the amendment or revocation. 2.04. The original election to participate shall be effective for pay periods commencing during the first month after the date on which the Participation Agreement is filed with the Administrator. Notice to ALL PARTICIPANTS to Read These Provisions Providing Deferral Limitations and "Catch -Up" Deferrals Under the Plan 2.05. Except as provided in section 2.06, the maximum that may be deferred under the Plan for the PARTICIPANT'S taxable year shall not exceed the lesser of (a) $7,500 or (b) 33 1/3% of the PARTICIPANT'S includible compensation as provided in I.R.C. of 1954 § 457. • • 2.06. For one or more of the PARTICIPANT'S last 3 taxable years ending before he attains normal retirement age under the Plan, the maximum deferral shall be the lesser of (a) $15,000 or (b) the sum of i) the limitation established for purposes of § 2.05 of the Plan for the taxable year (determined without regard to this section), plus ii) so much of the limitation established under § 2.05 for taxable years before the taxable year as has not heretofore been used under section 2.04 or 2.06 as provided in I.R.C. of 1954 § 457. ARTICLE III Accounts and Reports 3.01 The EMPLOYER shall remit the deferred amount to the Administrator or his designated agent. The Administrator shall have no duty to determine whether the funds paid to him by the EMPLOYER are correct nor to collect or enforce such payment. 3.02 For convenience and the facilitate an orderly adminis- tration of the Plan, the Administrator shall maintain a deferred account with respect to each PARTICIPANT. All assets of the Plan, including all deferred amounts, property and rights purchased with deferred amounts, 'and all income attributable to such deferred amounts, property or rights, shall be the exclusive property of the EMPLOYER and shall be subject to all the claims of creditors of the EMPLOYER, without protection or preference. 3.03 Upon receipt of each deposit of deferred amounts by the underwriter of the designated investment option made pursuant to this Plan, the PARTICIPANT'S deferred account. shall be credited z _ with the amount received. A written report of the status of the PARTICIPANT'S deferred account shall be furnished at least annually and within ninety (90) days after the end of each calendar year. 3.04 All interest, dividends, charges for premiums and administrative expenses, and changes in value due to market fluctuations that would be applicable to each PARTICIPANT'S deferred account had his deferred amount been invested in accordance with his investment specification shall be credited or debited to the account as they occur. Although the PARTICIPANT has no control over the account, all credits to the PARTICIPANT'S account shall be subject to and measured as if invested in the PARTICIPANT'S then effective investment specification. All reports to the PARTICIPANT shall be based on fair market value as of the reporting date, as if the deferred amount had been invested according to the PARTICIPANT'S investment specification. 3.05 Within ninety (90) days after the end of the calendar year, the Administrator shall file with the EMPLOYER a written report of the assets of the Plan, a schedule of all receipts and disbursements and a report of all material transactions of. the Plan during the preceding year. This report shall be in such form and contz.in such other information as the EMPLOYER shall determine or require. • 3.06 The Administrator's records shall be open to inspection during normal business hours by the EMPLOYER or any PARTICIPANT, or their designated representatives. -5- 3.07 The rights of the PARTICIPANT created .by this Plan shall be that of a general creditor of the EMPLOYER-only and in an amount equal to fair market value of the deferred account maintained with respect to the PARTICIPANT determined as if the deferred amounts had.been.invested pursuant to the PARTICIPANT'S investment specification. The: PARTICIPANT acknowledges that his rights are no greater than those of a general creditor of the EMPLOYER and that in any suit for an accounting, to impose a constructive trust, .or to recover any sum under this. Plan the PARTICIPANT'S rights are limited to those of a general creditor of the EMPLOYER. The EMPLOYER acknowledges that the Administrator is the agent of the EMPLOYER. ARTICLE IV Investment of Deferred Amount 4.01 The deferred amount shall be delivered by the EMPLOYER to the Administrator or his designated agent who shall transfer to a specified investment underwriter such amount, to be paid to the PARTICIPANT pursuant to Article V, as if such amounts were invested in accordance with the PARTICIPANT'S investment specifi- cation chosen from among those described in Attachment .B hereto. 4.02 The EMPLOYER shall only be required to use such invest- ment specification as an index for determining the benefits to be paid pursuant to Article V. The EMPLOYER shall be under no obligation to invest the deferred amount in such investment specification. All contracts and other evidences of the investments of all assets under this Plan shall :be registered in the name of the EMPLOYER which shall be the owner thereof. - - ARTICLE V Benefits 5.01 Benefits shall be paid in accordance with this Article. Benefits payable to the PARTICIPANT will be the equivalent of the total benefits that would have been created had the deferred amounts been invested as specified in Article IV hereof. (a) Normal Retirement. Upon the PARTICIPANT attaining normal retirement age, he may retire and receive the benefits provided under this Plan. Such benefits shall be paid in accor- dance with the payment option selected by the PARTICIPANT and described in Attachment B hereto. (b) Early Retirement. The EMPLOYEE may select early retirement in accordance with the Employer's Retirement System and receive the benefits provided under this Plan. Such benefits shall be paid in accordance with the payment option selected by the PARTICIPANT and described in Attachment B hereto. (c) Late Retirement. If the PARTICIPANT continues his employrnent•with the EMPLOYER after attaining normal retirement age, all benefits payable under this Plan will be deferred (whether or not the PARTICIPANT continues to defer additional stuns under this Plan) until the PARTICIPANT retires or attains age seventy (70) whichever occurs first.. At such time, such benefits shall be paid in accordance with the payment option selected by the PARTICIPANT and described in Attachment B hereto. No deferral. of additional credits under this Plan may be made by the PARTICIPANT after the month in which he attains age seventy (70). -7- (d) Termination of Employment. If the PARTICIPANT terminates his employment with the EMPLOYER, benefits shall be paid in accordance with the payment options elected by the PARTICIPANT and described in Attachment B hereto. (e) Death. If the PARTICIPANT dies while employed with the Employer and before retirement (early or normal) and without termination of service benefits being paid to him under this Plan, or the PARTICIPANT dies while benefits are being paid to him under this Plan, and before such benefits have been exhausted, the benefits payable under this Plan shall be paid to his designated beneficiary in accordance with the settlement option elected by the PARTICIPANT, or his Beneficiary, and described in Attachment B hereto. (f) Designated Beneficiary. The PARTICIPANT shall have the right to file with the Administrator, a written benefi- ciary or change of beneficiary form designating the person or persons who shall receive the benefits payable under this Plan in the event of the PARTICIPANT'S death. The form for this purpotie shall be provided by the Administrator and will have no effect - until it is signed, filed with the Administrator by the PARTICIPANT, and accepted by the Administrator. If the PARTICIPANT dies without having a beneficiary form on file, the payments shall be made to the properly appointed fiduciary of the PARTICIPANT'S probate estate. Provided, that if a fiduciary had not been appointed and qualified within one hundred twenty (120) days after the death, the payment may be made first, to a surviving spouse, second, to a surviving child or children or third, to a -8- surviving parent or parents. The PARTICIPANT accepts and acknow- - ledges that he has the burden for executing and filing with the Administrator, a proper beneficiary designation form. (g) Method of Payment. The payment of benefits shall begin on the first day of the month next following forty five (45) days after the occurrence of the event that gives rise to the beginning of the payment of benefits. (h) • Short Term or Lump Sum Settlement. Notwith- standing.anything in this Plan to the contrary, if at any time the amount held in a PARTICIPANT'S deferred account has a credit balance of .$2,000.00 or less, and for any reason other than retirement or disability, the PARTICIPANT has ceased to be a public employee, the Administrator may effect a lump sum settle- ment. (i) Payment and Settlement Options. Payment, method of payment, and settlement options are available as provided by each of the investment index options described in Attachment B hereto.. 5.02 Notwithstanding any other provisions herein, in the event of "unforeseeable emergency ", such event being beyond the control of the PARTICIPANT, a PARTICIPANT may request the Admin- istrator to pay benefits to him immediately. If the application for payment is approved by the Administrator, payment shall be effected as of the first day of the month next following such approval. Benefits to be paid shall be limited strictly to that amount necessary to meet the emergency situation constituting financial hardship. Any remaining benefits shall be paid in _ -9- - accordance with Paragraph 5.01 of this Plan. Payment of benefits because of an "unforseeable emergency" shall include the following: impending personal bankruptcy; unexpected and unreimbursed major expenses resulting from illness, accident, or disability of the PARTICIPANT or any dependent thereof; major property loss or any other type of unexpected and unreimbursed • personal expense of a major nature that would not normally be budgetable. Foreseeable personal expenditures normally budgetable, such as a down payment for a home, the purchase of an automobile, college, or other educational expenses, etc., will not constitute.a "unforeseeable emergency." The decision of the Administrator concerning "unforeseeable emergency" shall be final. .ARTICLE VI Administration of Plan 6.01 The EMPLOYER may .at any time amend, modify, or terminate this Plan with or without the consent of the PARTICIPANT (or any beneficiary thereof) provided: (a) That all amendments shall become effective on the first day of the month following the giving of not less than forty . five (0) days prior notice of the amendment. Notice shall be deemed given when the amendment is posted in the office of the Administrator. To the extent it is possible to do so, the Admin- . istrator shall mail a copy of all amendments that become effective during the year to the PARTICIPANT with his annual report. No amendments shall deprive the PARTICIPANT of any of the benefits to which he is entitled under this Plan with respect to deferred amounts credited to his account prior to the effective date of the amendment; and (b) If the Plan is curtailed, terminated, or the acceptance of additional deferred amounts suspended permanently, the Administrator shall nonetheless be responsible for the supervision and the payment of benefits resulting from amounts deferred prior to the amendment, modification, or termination in accordance with Article V. hereof. 6.02 Any companies that may issue any policies, contracts, or other investment media used by the EMPLOYER or specified by the PARTICIPANT, are not parties to this Plan and such companies shall have no responsibility or accountability to the PARTICIPANT or his beneficiary with regard to the operation of this Plan. 6.03 Participation in this Plan by a public employee shall not be construed to give a contract of employment to the PARTICI- PANT or to alter or amend an existing employment contract of the PARTICIPANT, nor shall participation in this Plan be construed as affording to the PARTICIPANT any representation or guarantee regarding his continued employment. 6.04 The EMPLOYER and the Administrator do not represent or guarantee that any particular Federal or State income, payroll, personal property, or other tax consequence will occur because of the PARTICIPANT'S participation in this Plan. The PARTICIPANT . should consult with his own representative regarding all questions of Federal or State income, payroll, personal property, or other tax consequences arising from participation in this Plan. -11.- 6.05 The Administrator may pay from deferred amounts the amounts described in Attachment B hereto. 6.06 The Administrator shall have the power to appoint agents to act and in the administration of this Plan and to select depositories for the assets of this Plan. 6.07 Whenever used herein, the masculine gender shall include the feminine and the singular shall include the plural unless the provisions of the contract specifically require a different construction. 6.08 The law of the State of the Employer shall apply in determining the construction and validity of this Plan. 6.09 The rights of the PARTICIPANT under this Plan shall not be subject to the rights of creditors of the PARTICIPANT or any beneficiary, and shall be exempt from execution, attachment, prior assignment, or any other judicial relief or order for the benefit of creditors or other third persons. 6.10 It is agreed that neither the PARTICIPANT nor his - beneficiary nor any other designee shall have any right to commute, sell, assign, transfer, or otherwise convey the right to receive any payments hereunder which payments and right thereto are expressly declared to be.nonassignable and nontransferable, 6.11 This Plan, and any properly adopted amendment thereof, shall constitute the total agreement or contract between the EMPLOYER and the PARTICIPANT regarding the Plan. No oral state- ment regarding the Plan may be relied upon by the PARTICIPANT. 6.12 This Plan and any properly adopted amendment, shall be binding on the parties hereto and their ,respective heirs, -12- - - • administrators, trustees, successors, and assigns and on all designated beneficiaries of the PARTICIPANT. ARTICLE VII Notice to ALL PARTICIPANTS to Read These Provisions Providing Broad Powers and Absolute Safeguards to the Employer 7.01 The EMPLOYER, or its authorized agent, the Administra- tor, shall be authorized to resolve any questions of fact necessary to decide the PARTICIPANT'S rights under this Plan and - such decision shall be binding on the PARTICIPANT and any beneficiary thereof. 7.02 The EMPLOYER, or its authorized agent, the Administra- tor, shall be authorized to construe the Plan and to resolve any ambiguity in the Plan. 7.03 The PARTICIPANT specifically agrees not to seek recovery against the EMPLOYER, the Administrator or any other • employee, contractee, or agent of the EMPLOYER or Administrator for any loss sustained by the PARTICIPANT or his beneficiary, for the non - performance of their duties, negligence, or any other misconduct of the above named persons except that this paragraph shall not excuse fraud or a wrongful taking by any person. 7.04 The EMPLOYER, or its : agents including the Administrator, if in doubt concerning the correctness of their action in making a payment of a benefit, may suspend the payment until satisfied as to the correctness of the payment or the person to receive the payment or allow the filing in ariy state court of -13- competent jurisdiction', a suit in such form as they consider appropriate for a legal determination of the benefits to be paid and the persons to receive them. The EMPLOYER shall comply with the final orders of the court in any such suit and the PARTICIPANT, for himself and his beneficiary, consents to be *bound thereby insofar as it affects the benefits payable under this Plan or the method or manner of payment. 7.05 The EMPLOYER and its agents, including the Administrator are hereby held harmless from all court costs and all claims for attorneys' fees arising from any action brought by the PARTICIPANT or any beneficiary thereof under this Plan or to enforce his rights under this Plan, including any amendments hereof. 7.06 The Administrator shall not be required to participate in any litigation concerning the Plan except upon written demand from the EMPLOYER. The Administrator may compromise, adjust or affect settlement of litigation when specifically instructed to do so by the EMPLOYER. IN WITNESS WHEREOF, the undersigned has executed . th PJ.an 4 this day of , 19 B �� r EXHIBIT "A" DEFINITIONS The following terms shall, for purposes of this Plan and all Exhibits thereto, have the meaning set forth herein. 1. EMPLOYER means, the or any of its agencies, departments, subdivisions or instrumen- talities, for whom services are performed by a participant. 2. PUBLIC EMPLOYEE, means, any person, including elected or appointed officials receiving any type of compensation from the or any of its agencies, departments, subdivision or instrumentalities for whom services are rendered, specifically including salaried employees, independent contractors, etc. 3. ADMINISTRATOR means, the person, department, agency, or organization appointed by the Employer to admin- ister the Plan. 4. COMPENSATION means, all payments made to a public employee by the Employer as remuneration for services rendered, including salaries, fees, etc. 5. PLAN YEAR means, the twelve month period between and , and each succeeding twelve month period during the existence of this Plan. -2- 6. BENEFICIARY means, the person properly designated by a Participant to receive the Participant's benefit. • 7. PARTICIPANT means, any public employee who partici- pates under this Plan by signing the Participation Agreement. 8. PARTICIPATION AGREEMENT means, the Application to the Administrator to participate in the Plan which is also entitled "Consent to Compensation Change." 9. NORMAL RETIREMENT AGE means, the age at which the Employee is eligible to retire pursuant to the Employer's Retirement System, by virtue of age, length of service or both. In the absence of a formal Employer's Retirement System, normal retire- ment age shall mean 55. 10. INCLUDIBLE COMPENSATION means, for the purposes of the limitations on deferral, compensation for services performed which (taking into account . amounts deferred under I.R.C. of 1954 §§ 457 and 403(b)) is currently includible in gross income. • •