Health Net 2009 Annual Report Download - page 238

payment in substantially equal annual installments, the delay described in the preceding sentence, if applicable, shall only be applied
to the installments which must be delayed in order to comply with Section 409A and shall not otherwise affect the timing of payment
of subsequent installments. A Participant may irrevocably elect, at least 12 months before a scheduled payment date, to delay the
payment date for a minimum period of 5 years from the originally scheduled date of payment, provided that, such irrevocable election
will be effective no earlier than 12 months after the date on which such election is made; further, provided, that any such election
shall be made in accordance with Section 409A(a)(4)(C) of the Code and the regulations thereunder, pursuant to procedures and rules
prescribed by the Company. If a Participant has only one election form on file with the Company and terminates employment with the
Employer before the expiration of twelve (12) months since the delivery of such election form, then, notwithstanding the Participant’s
election with respect to the timing of the payment, or commencement of payment, of his or her Account or In-Service Withdrawal
Account, as the case may be, the balance of such account shall be paid or shall commence to be paid on the Payment Date for the
calendar year in which the Participant’s employment terminates.
(b) In-Service Withdrawals. A Participant may elect to receive any percentage of an amount deferred for a Deferral Year in any
In-Service Withdrawal Year that begins at least three years after such Deferral Year. Such percentage shall be credited to an In-
Service Withdrawal Account established in the Participant’s name and the amount credited to such account shall be paid in a lump
sum within 90 days after the first day of the In-Service Withdrawal Year as elected by the Participant. Notwithstanding the
immediately preceding sentence, if a Participant terminates employment with the Employer in a calendar year prior to such In-Service
Withdrawal Year, then the amount credited to the Participant’s In-Service Withdrawal Account shall be paid in a lump sum on the
earlier of: (i) the Payment Date for the calendar year with respect to which the Participant’s Account shall be paid or shall commence
to be paid, as elected by the Participant pursuant to Section 4.1 (subject to the Required Delay), or (ii) within 90 days after the first
day of the In-Service Withdrawal Year as elected by the Participant.
(c) Company Deferral Discretion. Notwithstanding a Participant’s election, the Company may, in its sole discretion, defer the
payment of all or any portion of any account of a Participant to the extent the Company determines that the payment on such Payment
Date would cause the Participant’s Employer to be unable to deduct any portion of the Participant’s Compensation as a result of the
limitations prescribed by Section 162(m) of the Code; provided, however, that any such deferral may only be made in a manner which
is in compliance with the requirements of Section 409A.
4.2 Manner of Payment. Each Participant shall receive payment of the amount credited to the Participant’s Account either in a
single lump sum or in substantially equal annual installments (as adjusted to reflect earnings or losses thereon) at least equal to $1,000
over a period of not less than two and not more than ten years, as elected by the Participant upon his or her commencement of
participation in the Plan. Notwithstanding the foregoing sentence, such Account shall be paid to such Participant or his or her
Beneficiary in the form of a single lump sum if (i) the amount credited to such Account as of the relevant Payment Date is less than
the applicable dollar amount under Section 402(g)(1)(B) of the Code, (ii) the Participant has not attained age 55 as of the date of such
Participant’s termination of employment with an Employer or (iii) the Participant dies before all installment payments have been
made.
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