SECTION 4. WHAT IS A § 403(b)

PROTOTYPE PLAN?

.01 A § 403(b) prototype plan is a defined contribution plan that is intended to satisfy the requirements of § 403(b) and is made available by a prototype sponsor for adoption by eligible employers. A § 403(b) prototype plan consists of a basic plan document and an adoption agreement. The basic plan document contains all the nonelective provisions of the prototype plan that apply to the plans of all adopting eligible employers. The basic plan document may not include any options or blanks to be completed. The adop

tion agreement contains all the options that may be selected by an adopting eligible employer.

.02 An adoption agreement can be used with only one basic plan document. A basic plan document can be used with more than one adoption agreement, but each basic plan document/adoption agreement pair constitutes a separate § 403(b) prototype plan. A § 403(b) prototype plan adopted by an eligible employer is a single plan regardless of whether there are multiple investment arrangements or multiple vendors ( i.e., insurance companies or regulated investment company custodians) under the plan. Adoption of two prototype § 403(b) plans (that is, execution of two separate adoption agreements) constitutes the adoption of two separate § 403(b) plans.

.03 A prototype sponsor may maintain more than one basic plan document. For example, a prototype sponsor may maintain one basic plan document to be used only with plans that limit contributions to elective deferrals and another basic plan document to be used with plans that provide for elective deferrals and employer nonelective contributions, whether or not such plans also provide for matching contributions and/or after-tax employee contributions.

.04 As described above, a basic plan document may have more than one adoption agreement. For example, a basic plan document may have one adoption agreement to be used to adopt a standardized plan and another adoption agreement to be used to adopt a nonstandardized plan. See section 6 for an explanation of the difference between a standardized plan and a nonstandardized plan.