Section 3. ADP Test Safe Harbor

3.1 ADP Test Safe Harbor Contributions

(a) Unless the Employer elects in the adoption agreement to make Enhanced Matching Contributions or Safe Harbor Nonelective Contributions, the Employer will contribute for the Plan Year an ADP Test Safe Harbor Matching Contribution to the Plan on behalf of each Eligible Employee equal to (i) 100 percent of the amount of the employee's Elective Deferrals that do not exceed 3 percent of the employee's Compensation for the Plan Year, plus (ii) 50 percent of the amount of the employee's Elective Deferrals that exceed 3 percent of the employee's Compensation but that do not exceed 5 percent of the employee's Compensation ("Basic Matching Contributions").

(b) Notwithstanding the requirement in (a) above that the Employer make the ADP Test Safe Harbor Contributions to this Plan, if the Employer so provides in the adoption agreement, the ADP Test Safe Harbor Contributions will be made to the defined contribution plan indicated in the adoption agreement. However, such contributions will be made to this Plan unless (i) each Eligible Employee under this Plan is also eligible under the other plan and (ii) the other plan has the same Plan Year as this Plan.

(Note to reviewer: The option to make ADP Test Safe Harbor Contributions to another defined contribution plan is permitted only if this Plan is a Nonstandardized Pre-approved Plan.)

(c) The participant's accrued benefit derived from ADP Test Safe Harbor Contributions is nonforfeitable and is subject to the same distribution restrictions as apply to Elective Deferrals , except that no distribution can be made on account of hardship. In addition, such contributions must satisfy the ADP Test Safe Harbor without regard to permitted disparity under Code section 401(l).

3.2 Notice Requirement

(Note to reviewer: Section 103(a) of the SECURE Act amended the Code to eliminate the notice requirement for a traditional safe harbor § 401(k) plan that satisfies the safe harbor nonelective contribution requirements. Section 103(a) did not amend Code § 401(m)(11).

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Therefore, Code § 401(m)(11)(A)(ii) continues to require all traditional safe harbor section 401(m) plans to satisfy the safe harbor notice requirements of Code § 401(k)(12)(D).)

At least 30 days, but not more than 90 days, before the beginning of the Plan Year, the Employer will provide each Eligible Employee a comprehensive notice of the employee's rights and obligations under the Plan (the “Safe Harbor Notice”), written in a manner sufficiently accurate and comprehensive to apprise the employee of such rights and obligations and calculated to be understood by the average Eligible Employee. If an employee becomes eligible after the 90th day before the beginning of the Plan Year and does not receive the notice for that reason, the notice must be provided no more than 90 days before the employee becomes eligible but not later than the date the employee becomes eligible.

(Note to reviewer: The following is applicable to plan years beginning after December 31, 2023, if an Employer replaces a SIMPLE IRA with a Safe Harbor § 401(k) Plan.)

If the Employer elected during the year to terminate a qualified salary reduction arrangement under a SIMPLE IRA of the Employer (or related employer), and the Employer establishes this plan to replace the terminated arrangement, the Employer will provided each Eligible Employee a notice for the year the safe harbor plan is established describe the limit on contributions to this plan. The notice will accurately describe the type and amount of compensation that may be deferred under the plan and will describe the limit on contributions this plan for that transition year.

3.3 Election Periods

In addition to any other election periods provided under the Plan, each Eligible Employee may make or modify a deferral election during the 30-day period immediately following receipt of the notice described in section 3.2 above.

(Note to reviewer: Notice must be provided to all Eligible Employees if at any time the Safe Harbor CODA is amended by the Employer during a Plan Year to prospectively reduce or suspend Safe Harbor Nonelective Contributions, or for amendments adopted on or after January 1, 2015, for Safe Harbor Matching Contributions. The notice must generally provide that the reduction or suspension must apply no earlier than the later of the date the plan amendment reducing or suspending contributions is adopted or 30 days after the supplemental notice is provided to Eligible Employees. Additionally, for mid-year changes made on and after January 29, 2016, notice must be provided to all Eligible Employees of any other permissible mid-year change to a plan’s required safe harbor notice content, at least 30 days (and not more than 90 days) before the effective date of the change.)

[Note to reviewer: Notice will be provided to all Eligible Employees if at any time the Safe Harbor CODA is amended by the Employer during a Plan Year to prospectively reduce or suspend Safe Harbor Nonelective Contributions, or, for amendments adopted on or after January 1, 2015, for Safe Harbor Matching Contributions. The notice will provide that the

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reduction or suspension must apply no earlier than the later of the date the plan amendment reducing or suspending contributions is adopted or 30 days after the supplemental notice is provided to Eligible Employees. Additionally, for mid-year changes made on and after January 29, 2016, notice will be provided to all Eligible Employees of any other permissible mid-year change to a plan’s required safe harbor notice content, at least 30 days (and not more than 90 days) before the effective date of the change.]

(Note to reviewer: See Reg. §§ 1.401(k)-3(e) and 1.401(m)-3(f) for safe harbor plan rules requiring certain provisions to remain in effect for an entire 12-month year. See also Notice 2016-16, 2016-7 I.R.B. 318, for permissible and impermissible mid-year safe harbor plan amendments. Refer to the section below on Qualified Automatic Contribution Arrangements (“QACAs”)for additional notice requirements applicable to plans using the QACA rules of Code § 401(k)(13) for purposes of meeting the ADP Test Safe Harbor.)