The Hartford 2008 Annual Report Download - page 771

(B) Limit on Before-Tax Savings and Roth 401(k) Savings for Highly Compensated Members.
(i) Actual Deferral Percentage. With respect to each Plan Year, the Actual Deferral Percentage for Highly
Compensated Members shall not exceed the greater of: (i) 125 percent of the Actual Deferral Percentage for all
other Members for the Plan Year, or (ii) the lesser of (a) 200 percent of the Actual Deferral Percentage of all other
Members for the Plan Year or (b) the Actual Deferral Percentage of all other Members for the Plan Year plus
2 percentage points. Before-Tax Savings and Roth 401(k) Savings must have been allocated to Members’
Accounts during the Plan Year and may only be based on Salary received by a Member during the Plan Year or
earned during the Plan Year and received by the Member within 2 1/2 months after the end of the Plan Year. In the
event the Actual Deferral Percentage for Highly Compensated Employees for any Plan Year exceeds the limits
described above, the Plan Administrator will choose one of the following methods to satisfy the limits:
(a) The Floor Company Contribution will be treated as a qualified nonelective contribution that, in combination
with Before-Tax Savings and Roth 401(k) Savings, allows the Plan to satisfy the limits. The Company will make
an additional qualified nonelective contribution, if necessary, for the Plan to satisfy the limits. Any qualified
nonelective contribution made under this Section 6.1(B)(i)(a) shall be made in accordance with the requirements
of Treas. Reg. Section 1.401(k)-2(a)(6).
(b) Excess contributions will be distributed in accordance with the paragraph below.
(c) Excess contributions will be recharacterized in accordance with the following paragraph.
To determine the amount of excess contributions, the Plan Administrator will (1) determine the hypothetical
reductions of the Highly Compensated Employees beginning with the highest Actual Deferral Percentage and
moving toward lower percentages until one of such limitations is met; (2) then determine the total dollar amount
of such reductions; and (3) then reduce the Before-Tax Savings of the Highly Compensated Employees beginning
with the highest dollar amount and moving toward lower dollar amounts until the total dollar amount in (2) above
is reached. For purposes of the preceding sentence, the “highest amount” is determined after distribution of any
excess contributions. Such amount of excess contributions, as adjusted for investment experience, will be
distributed to the Members on whose behalf such contributions were made or, under rules adopted by the Plan
Administrator, such Members may elect to recharacterize such adjusted contributions as After–Tax Savings. Any
such recharacterization or distribution of the adjusted excess contributions will be made to the Highly
Compensated Employees on the basis of the respective portion of the adjusted excess contributions attributable to
each of such Employees and the recharacterization or the distribution of the adjusted excess contributions will be
made to the Employees on whose behalf such contributions were made within 12 months following the end of the
Plan Year for which the deferrals were made. The amount of such recharacterization or distribution of any excess
contributions shall be reduced by excess deferrals previously distributed for the taxable year ending in the same
Plan Year and the amount of such distribution of any excess deferrals shall be reduced by excess contributions
previously distributed or recharacterized for the Plan Year beginning in such taxable year. Excess contributions
shall be adjusted for any income or loss up to the date of distribution in accordance with IRS regulations; the Plan
will not fail to use a reasonable method of computing the income allocable to excess contributions merely because
the income allocable to the excess contributions is determined on a date that is no more than seven days before the
distribution.
(ii) ESOP Actual Deferral Percentage. With respect to each Plan Year beginning prior to January 1, 2006, the
ESOP Actual Deferral Percentage shall be subject to the limits and corrections for Before-Tax Savings that are
ESOP Contributions determined in the same manner as set forth in paragraph (i), above.
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Source: HARTFORD FINANCIAL S, 10-K, February 12, 2009