SOUTHWEST AIRLINES CO.
401(k) AND PROFITSHARING PLAN
PREAMBLE
WHEREAS, SOUTHWEST
AIRLINES CO., a corporation formed under the laws of the State of Texas (the Company) previously adopted a profit sharing plan and trust designated as the Southwest Airlines Co. ProfitSharing Plan, effective as of January 1, 1973,
and which was amended and restated in its entirety, effective as of January 1, 1991, to continue the cash or deferred feature of that plan as a separate plan which is the subject of an Internal Revenue Service favorable determination letter
dated October 11, 2017, for the plan, as amended and restated effective as of January 1, 2017; and
WHEREAS, effective as of
January 2015, the Company amended and restated the Plan, in its entirety, in the following respects: (i) to adopt wording that is consistent with electronic administration of beneficiary designations, applications, notices, requests and
decisions; (ii) to simplify Plan provisions relating to distributions, including eliminating the age 62 distribution requirement for former Members; (iii) to adopt time limits on claims, mandatory venue for litigation and other claims
procedural changes; (iv) to comply with Federal law defining the term spouse; and (v) to make other nonsubstantive administrative and technical changes and corrections; and
WHEREAS, the Company amended the Plan to merge the AirTran Airways Technical Operations Retirement Savings Plan into the Plan effective as of
January 1, 2016 and to allow partial distributions of benefits from plan accounts; and
WHEREAS, the Company amended the Plan
effective as of January 1, 2017 (i) to provide for the automatic resumption of deferrals after the six-month hardship withdrawal suspension period, (ii) to permit Members to take required minimum
distributions from the Plan in periodic payments, and (iii) to change the definition of Annual Compensation to exclude certain cash payments; and
WHEREAS, effective as of June 1, 2018, the Company amended the Plan to provide special provisions for employees in Puerto Rico to
simplify the administration of the Plan and to ensure the continued qualification of the Plan under the Internal Revenue Code of the United States and Puerto Rico; and
WHEREAS, effective as of April 1, 2018, the Company amended the Plan to allow Qualified Hurricane Distributions to qualifying Members who
suffered an economic loss as a result of Hurricanes Harvey or Irma; and
WHEREAS, effective as of June 1, 2018, the Company amended
the Plan to change how Plan benefits are paid to Beneficiaries who die after the Members death; and
WHEREAS, effective as of
January 1, 2019, the Company amended the Plan to implement the rules regarding hardship distributions made by the Bipartisan Budget Act of 2018; and
WHEREAS, effective as of May 1, 2019, the Company amended the Plan to allow periodic installment payments as a payment form; and
WHEREAS, effective as of January 1, 2020 (unless stated otherwise), the Company amended the Plan in the following respects:
(1) increase the required beginning date triggering age from 70-1/2 to 72 as provided in the Setting Every Community Up for Retirement Enhancement Act; (2) reflect the changes in the Coronavirus Aid,
Relief, and Economic Security Act (the CARES Act): (3) allow SIMPLE IRAs to be included as an eligible retirement plans as provided in the Consolidated Appropriations Act of 2016; (4) allow forfeitures to be used to pay administrative
expenses of the Plan and Trust; and (5) change the Plans Normal Retirement Date to be age 59 1/2 to be consistent with the Southwest Airlines Co. ProfitSharing Plan; and
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