MISSING PARTICIPANT & DEFAULT IRA ROLLOVER PROGRAMS

A Missing Participant is an individual who has an account balance or accrued benefit under a qualified plan who has terminated their employment with the Plan Sponsor; however, they have failed to provide the Employer or TPA with a current or forwarding address.

A Default IRA is a concept recently introduced by Congress which states that a Plan Sponsor can force a distribution of a terminated employee to an IRA, provided the value of the benefit is not less than $1,000 or greater than $5,000. These account balances belong to individuals who do not qualify as Missing Participants, but rather as unresponsive individuals. They simply refuse to return the benefit election forms sent to them. This provision was enacted to allow the Plan Sponsor and / or TPA to administer the plan in a more efficient and cost effective manner.

The law has some interesting twists when it comes to Missing Participants. For example, if the plan is not terminating, the most you can transfer to a Missing Participant IRA is $5,000. On the other hand, if the plan is terminating, then the upper limit of $5,000 disappears and any amount can be transferred on behalf of the Missing Participant.

HOW THE PROGRAM WORKS

Interested parties should contact PenChecks, Inc. to ask for a Missing Participant & Default Rollover Kit. Inside the kit are the following documents:

1. IRA Custodial Financial Disclosure Statement
2. Missing Participant Rollover IRA Account Application
3. Trustee Authorization to establish an Individual Retirement Account for a Missing Plan Participant
4. Special Resolution or Plan Amendment, or both, to be adopted by the Plan's sponsor/trustees
5. IRA Custodial Agreement
6. Missing Participant Rollover IRA Account Fee Schedule
7. IRA Disclosure Statement

Items 2, 3, 4 and 6 must be completed, signed by the trustee and/or plan sponsor of the plan and returned to PenChecks, Inc. with the initial processing fees made payable to PenChecks, Inc.

Amounts to be rolled over may be transmitted by check or wire to PenChecks, Inc.’s Independent Trust Account.

To contact us, call PenChecks, Inc. at (800) 541-3938 and ask for the Missing Participant IRA Rollover desk, or visit our website at www.penchecks.com and request an IRA Rollover Kit.

FEES

One-Time Fees
There is a one-time set-up fee for the plan sponsor and a single distribution processing fee per missing participant. The one-time setup fee for the plan is good for processing an unlimited number of missing participants from that plan.

Annual Fees
There is a nominal custodial fee charged directly to each missing participant’s account on an annual basis.

For a full breakdown of all fees, contact PenChecks, Inc. for the complete Missing Participant / Default IRA Rollover Program Fee Schedule.

ORGANIZATIONS INVOLVED

PenChecks, Inc.
PenChecks, Inc. was formed by fourteen well-established pension administration firms, with an average of a quarter of a century’s worth of experience per firm. Their mission is to alleviate the burden of complex and time-consuming qualified plan distribution requirements for their clients (plan sponsors, TPAs and other strategic partners) while delivering premiere plan distribution services in a highly cost-effective and efficient manner. Pooled resources and a strict focus on distribution services allow PenChecks, Inc. to provide exceptional expertise in participant distributions and other related distribution services.

First Regional Bank
First Regional Bank was founded in 1979 to provide high-quality banking services to businesses and professionals throughout Southern California. Their focus is on relationship banking, with a "Customer Centric" philosophy of service. They are dedicated to understanding the unique requirements and needs of each business client and to providing superior banking services that are highly personal, responsive and creative. They have seven strategically located offices throughout Southern California. In addition, they operate Trust Administration Services Corp., a wholly owned subsidiary of the Bank.

Alpha & Omega Financial Management Consultants, Inc.
Alpha & Omega was founded in 1975. It is a Regional Employee Benefit Consulting firm, specializing in trust and IRA administration. In addition, it is an Investment Advisory firm.

ROLE OF EACH ORGANIZATION

PenChecks, Inc: Serves as the exclusive marketing agent for the First Regional Bank Missing Participant & Default IRA Rollover Programs. PenChecks, Inc. also acts as the conduit between First Regional Bank, the plan sponsor / trustee(s) and Alpha & Omega. PenChecks, Inc. assists plan sponsors and trustees in obtaining and completing all required paper work to establish a Missing Participant IRA Rollover account with First Regional Bank.

First Regional Bank: Serves as the custodian for the Missing Participant & Default IRA Rollover Programs. Plan sponsors / trustees agree that all submitted funds will be deposited into either an FDIC insured money market account or certificate of deposit provided by First Regional Bank for the benefit of the missing participant and / or their beneficiary.

Alpha & Omega Financial Management Consultants, Inc: Serves as the exclusive administrator of the First Regional Bank Missing Participant & Default IRA Rollover Programs. Alpha & Omega adjusts all account records on a quarterly basis to reflect current earnings and expenses of the individual participant account. Finally, each year Alpha & Omega is responsible for issuing and mailing IRS Form 5498 for each Missing Participant & Default IRA account on behalf of First Regional Bank.