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New Temporary Provisions during COVID-19 Pandemic
Arconic Corp. 401(k) Plan

April 27, 2020
This notice describes new temporary provisions that have been added to the Arconic Corp. 401(k) Plan as allowed by the recently passed Coronavirus Aid, Relief, and Economic Security (CARES) Act. These temporary provisions can assist employees and plan participants who are experiencing financial difficulties as a result of the COVID-19 pandemic. Please read this notice carefully and in its entirety.
Key changes available beginning May 8, 2020
• New Coronavirus Related Distributions allowing you to withdraw certain account balances up to $100,000 through December 31, 2020, subject to satisfying required eligibility.
• Option to suspend loan payments due through December 31, 2020 for up to 12 months on existing or new loans, subject to satisfying required eligibility.
• Required minimum distributions (RMDs) for the 2020 calendar year have been waived.

Details and frequently asked questions (FAQs) on each of these key changes is included in this notice. Also, if you are interested in taking a Coronavirus Related Distribution or suspending your loan payments, please review the Your Next Steps section of this notice before May 8, 2020. Taking these steps in advance of May 8, 2020 will reduce the possibility of a processing delay.

Take Note: Keep in mind that the purpose of the 401(k) Plan is to provide for your retirement. Amounts kept in the plan, and the earnings they produce, are not taxed until eventually paid to you. It is always wise to consult with a financial or tax advisor before taking any distribution from your plan, particularly in periods of volatile market activity. Also, because of the tax benefits of keeping your plan accounts whole, you may wish to explore other types of financial assistance before you apply for any of the temporary provisions described in this notice.

Eligibility for Coronavirus Related Distribution or Suspension of Loan Payments
(COVID-19 Eligibility Requirements)
Federal law requires that you must meet one of the following criteria in order to be eligible for a Coronavirus Related Distribution or to utilize the option to suspend loan payments:
• you have been diagnosed with the virus SARS-CoV-2 or with coronavirus disease (“COVID-19”) by a test approved by the Centers for Disease Control and Prevention; or
• your spouse or dependent is diagnosed with the virus or disease by such test; or
• you experience adverse financial consequences as a result of being quarantined, furloughed, or laid off, or having work hours reduced due to such virus or disease, or being unable to work due to a lack of child care due to the virus, or the closing or reduced hours of a business owned or operated by you due to such virus or disease, or other factors as determined by the Secretary of the Treasury (or the Secretary’s delegate).
You must self-certify that you meet one of the above criteria on the UPointTM website or on your recorded phone call with an ARCONIC4U representative when requesting a distribution or loan payment suspension.

Coronavirus Related Distribution (available beginning May 8, 2020)
If you self-certify that you meet the COVID-19 Eligibility Requirements, you may request withdrawal of amounts totaling no more than $100,000 through December 31, 2020. The following special rules apply to this distribution.
• You may request one distribution per month and the amount of the distribution must be at least $250.
• Distributions will not be subject to the 10% early withdrawal penalty tax which normally applies to payments made before age 59 ½.
• Your distribution will be subject to income tax, but you can elect to pay the tax on the distribution amount equally over a three-year period. For example, if you withdraw $30,000 in 2020, you can include $10,000 as income for each of 2020, 2021 and 2022, rather than paying taxes on the entire $30,000 for 2020. Your election will be made when you file your personal tax return.
• The 20% mandatory tax withholding that normally applies to 401(k) distributions will not apply to a Coronavirus Related Distribution. However, 10% withholding will apply to your distributions for federal income tax purposes, unless you elect otherwise.
• At any time during the three-year period beginning with the date of the distribution, you may repay any portion of the distribution to your account in the Arconic Corp. 401(k) Plan, if you are still employed (or to an IRA or other tax-qualified plan). If you repay any portion, you will avoid having to pay tax on the repaid portion of the distribution. You will need to report any amount you repay during a taxable year and you will also determine the amount of the coronavirus-related distribution that is includible in income for the taxable year.
• You will not be required to take loans or other available amounts prior to electing to take a Coronavirus related distribution.
• Not all account balances are eligible for withdrawal. If you are under age 59 ½, you will not be able to withdraw the following contributions and related earnings: Company matching contributions made on or after January 1, 2011, employer retirement income contributions (ERIC), and restricted discretionary contributions. Unless you have terminated employment with Arconic, you will not be able to withdraw any retiree medical savings account contributions and related earnings.
• Your elected contributions will not stop when you take a withdrawal. However, if you want to temporarily change your future contributions, you may do so on the UPointTM website at http://digital.alight.com/arconic or by calling ARCONIC4U representatives at 1-844-927-2664. Please note that reducing your pre-tax contributions may also reduce matching contributions you receive from Arconic.
• You may choose to have any withdrawals paid to you via check or direct deposit subject to applicable verification waiting periods which are in place for your security.

Withdrawal requests can be made on or after May 8, 2020 and before December 31, 2020 on the UPointTM website or by calling ARCONIC4U at 1-844-927-2664.

Take Note: Before you request a withdrawal from your 401(k) account, you should understand that you may be permanently removing savings from your account and reducing your balance (and potentially reducing your future tax-deferred earnings). A reduced account balance also means you’ll have less savings available for your future retirement. We recommend you consult with your tax or financial advisor before making a withdrawal.

Suspension of Loan Payments (available beginning May 8, 2020)

If you self-certify that you meet the COVID-19 Eligibility Requirements, you may request to suspend your loan payments due before December 31, 2020 for a one-year period without putting your loan into default. The following rules apply to suspension of loan payments.
• You may request to suspend your loan repayments for existing loans and new loans initiated on or before December 31, 2020.
• Loan repayments will be suspended for the 12-month period beginning on the date you self-certify and request suspension of loan repayments.
• You cannot request the suspension be lifted prior to the end of the 12-month period. However, you may pre-pay any portion of your outstanding loan at any time. Contact ARCONIC4U for instructions for pre-payment options.
• At the end of the 12-month period, any suspended loans will be reamoritized (re-calculated). The reamortized payment schedule will reflect the following:
o The original remaining period outstanding on the loan as of the date of suspension. For example, if you had 36 payments remaining on your loan at the date of suspension, you will continue to have 36 months to repay the remaining after the 12-month suspension.
o The interest accrued on the outstanding loan balance during the period of suspension. Your remaining payments will increase to include this accrued interest.
Loan payment suspension requests can be made through December 31, 2020 on the UPointTM website or by calling 1-844-927-2664.
Required Minimum Distributions Waived for 2020 Calendar Year
Any 2020 calendar year Requirement Minimum Distribution (RMD) for a participant or beneficiary will not be automatically paid. Participants or beneficiaries may voluntarily request payment and the payments will be treated as a RMD for 2020. 2020 RMDs paid after December 31, 2020 but before April 1, 2021 are not waived.
Your Next Steps
Review the attached FAQs.
If you are considering taking money out of your 401(k) when these options become available on May 8, 2020, we urge you to immediately update/validate your mailing address, home phone number, mobile phone number, and financial institution information (i.e., direct deposit account information) on the UPoint TM website at http://digital.alight.com/arconic or by calling ARCONIC4U at 1-844-927-2664. If you don’t do this in advance of a withdrawal request, you may experience a delay in receiving funds due to security requirements. If you haven’t already, you should also register for text messages, to ensure you receive all notices about your account.

New Temporary Provisions during COVID-19 Pandemic
Frequently Asked Questions (FAQs) – Arconic Corp. 401(k) Plan

Eligibility Requirements
Q. Why are there specific requirements for receiving Coronavirus Related Distribution and Suspending Loan Repayments?
A. The CARES Act requires that individuals meet these specified requirements in order to take these tax advantaged distributions and suspend loan repayments from the tax-qualified 401(k) plan.

Q. Are terminated and active employees eligible for the Coronavirus Related Distribution and Suspending Loan Repayments?
A. Yes, all participants in the Arconic Corp. 401(k) Plan are eligible for these new provisions so long as they meet the eligibility requirements.

Q. Who is considered a dependent for purposes of the special eligibility requirements?
A. A dependent is someone who meets the definition of dependent in Internal Revenue Code Section 152. Additional information on determining dependency can be found in IRS Publication 17. See also the instructions to the 2019 Form 1040 for information on determining whether or not someone qualifies as a dependent. IRS publications and tax return instructions can be found on its website at www.irs.gov.

Q. Does the 10% reduction in salary applicable to salaried employees qualify for meeting the eligibility requirements?
A. No. While salaries have been reduced, the current available information on the requirements indicates that you must be furloughed, laid off or have a reduction in hours due to the virus. To date, the Secretary of the Treasury has not issued any additional factors for eligibility. We will notify you of additional factors for eligibility when issued by the Secretary of the Treasury.

Q. My spouse has been laid off or furloughed. Can I request a Coronavirus related distribution?
A. No. The requirements indicate that you (not your spouse) must be furloughed, laid off or have a reduction in hours due to the virus. We will notify you if any further guidance issued by the Secretary of the Treasury changes this.

Q. You indicate that I will be required to self-certify that I am eligible for the two new options. How will I self-certify?
A. On or after May 8, 2020, you can self-certify that you meet the requirements either by certifying electronically to meeting the requirements on the UPoint website or by verbally confirming on the recorded call with an ARCONIC4U representative. Your electronic and verbal consents will be retained for administrative records.

Coronavirus Related Distributions (CRD)
Q. Is there a cap on how much can I withdraw for a CRD?
A. Yes. During 2020, you may withdraw up to a total of $100,000 of your eligible account balance in coronavirus related distributions from the Plan.

Q. Can I take multiple CRDs?
A. Yes, you may take multiple distributions from the plan between May 8, 2020 and December 31, 2020. However, the total amount of all distributions cannot exceed $100,000. The Plan does not allow more than one distribution per month and each distribution must be at least $250.

Q. Do I have to take a loan or other withdrawal from the plan before taking a CRD?
A. No, you are not required to take a loan or non-hardship withdrawal prior to taking a CRD. However, you should carefully consider whether a loan or a CRD is the right option for you.

Q. Can I choose which investment funds will be depleted for the CRD?
A. No, withdrawals will be removed on a prorated basis across all applicable investment funds.

Q. Can I choose which accounts will be withdrawn from for the CRD?
A. No, withdrawals will be removed from your total plan account in the following order (subject to applicable restrictions)
o your after-tax savings and related earnings;
o any rollover savings and related earnings;
o your pre-tax savings and related earnings;
o Company matching contributions and related earnings;
o discretionary contributions, and related earnings;
o Employer Retirement Income Contributions (ERIC) and related earnings;
o Retiree Medical Savings Account contributions and related earnings; and then
o Your pre-tax savings and related earnings.

Q. Why are certain contributions and earnings not available as part of the CRD?
A. Arconic’s company contributions are intended as a source of funds for retirement. As such, the company preserves these contributions (matching, some discretionary and ERIC) and earnings on such until retirement or age 59 ½ whichever is earlier and prefers to maintain these provisions. Retiree Medical Savings Account contributions are only available after termination of employment, per the terms of applicable collective bargaining agreements.

Q. Will I have to pay the 10-percent early withdrawal penalty if I take a CRD?
A. No. The 10-percent tax penalty that generally applies to early withdrawals from a retirement account if you are younger than 59½ does not apply to CRDs under the CARES Act.

Q. What federal and state tax withholding will apply to my CRD?
A. Federal tax withholding will be defaulted to 10%, unless you elect otherwise. State tax withholding requirements have not changed. Note that non-resident alien tax withholding requirements will continue to be applicable and have not been modified by the CARES Act.

Q. How quickly can I receive payment of my CRD after requested?
A. Direct deposit to your financial institution is the fastest way to receive your payment. You should receive your check or direct deposit within 7 to 10 days following receipt of your completed payment request. Please note that you must have your direct deposit instructions or your updated address on file for at least 7 days prior to any payment. This is for your account security. In addition, we recommend you add a personal email or sign up for text alerts so that you can quickly receive information about account activity.

Q. Can I recontribute the withdrawn funds to my 401(k) account?
A. Generally, yes. The CARES Act allows you to recontribute the funds you withdrew to the Plan in one or more payments within three years. The recontributed amounts will not count toward the maximum contribution limit in the year that the funds are recontributed to the Plan.

Q. How will taxes be handled on my CRD if I don’t pay my distribution back? How will they work if I pay back my distribution into the 401(k) or an IRA?
A. If you do not pay back your distribution, you will be assessed income tax on the distribution equally over a three-year period. Further guidance is needed from the IRS on the details of how the repayment provisions will be applied when you file your personal tax return. We recommend you consult with a tax advisor once further guidance is available.

Q. I meet the eligibility conditions, but I don’t know whether I should take a distribution. What should I consider?
A. We recommend you consult with a tax or financial advisor on the options that are best for your personal situation. Keep in mind that the purpose of the 401(k) Plan is to provide for your retirement. Before you request a withdrawal from your account, you should understand that you may be permanently removing savings from your account and reducing your balance. A reduced account balance also means you’ll have less savings available for your future retirement. Amounts kept in the plan, and the earnings they produce, are not taxed until they are eventually paid to you. Therefore, you may wish to explore other types of financial assistance after consulting with your tax or financial advisor.

Suspension of Loan Payments
Q. If I elect to suspend my loan payments will they stop being taken from my paycheck?
A. Yes, if you are actively employed and receiving paychecks, your loan repayment deductions in your paycheck will stop as soon as administratively possible after we receive your completed request to suspend loan payments.

Q. If I am not actively employed, can I request suspension of loan payments?
A. Yes, all participants with loans in the Arconic Corp. 401(k) Plan are eligible to suspend loan payments, subject to satisfying the eligibility requirements.

Q. If I take out a new loan before December 31, 2020 can I immediately request a suspension of payments for 12 months?
A. Yes, you may request a suspension of payments on any new loan requested before December 31, 2020, subject to satisfying the eligibility requirements.

Q. Can I request a longer time to pay my loan after the 12-month suspension?
A. No, you may not extend the period of any existing loan. For example, if prior to your request for suspension of payments you had 24 payments remaining, after the end of the 12-month suspension, you will still be required to make payments over 24 months (note this is 12 months after the original due date of your loan).

Q. Can I make payments on my loan during the suspension?
A. Yes, you can make manual or early loan repayments during the suspension. However, loan repayment deductions will not be taken from your paycheck. Please visit the UPoint website or call ARCONIC4U to receive information on how to make these payments.

Required Minimum Distribution Waiver (RMD Waiver)
Q. What is a Required Minimum Distribution (RMD)? Does it apply to me?
A. In general, if you turned age 70 ½ before January 1, 2020, you are required to take certain minimum distributions from the plan beginning in the year after you turned 70 ½ and every year thereafter. We would have notified you of any requirement to take a distribution by mail.
If you were due to take a RMD in 2020, the CARES Act temporarily waives the RMD for the calendar year 2020. Unless the waiver is extended to the 2021 calendar year, anyone who turned 70 ½ before January 1, 2020 or turned age 72 in 2020 will be required to take a RMD in 2021.

Q. I already took my 2020 RMD, can I put it back into the 401(k) Plan?
A. No, there is no provision in the CARES Act that allows for this. However, there is a 60-day grace period from the date you received the RMD that allows the RMD to be rolled over into an IRA. This provision allows you to avoid paying income tax on the RMD and take advantage of the relief afforded under the CARES Act. You should consult with your tax or financial advisor about possible available options.
Arconic will update these FAQs as guidance is issued.

For questions about the Plan or information on how to access your savings, you have the following resources:
• UPointTM at http://digital.alight.com/arconic – This interactive website is available 24 hours a day Monday through Saturday, and after 1 p.m. Eastern Time on Sunday. To access the UPoint website, the Company requires you to use your personal user ID and password.
• 1-844-9ARCONIC (1-844-927-2664) – This automated telephone system is available 24 hours a day Monday through Saturday, and after 1 p.m. Eastern Time on Sunday. The non-toll-free number for international callers is 1-312-843-5240. Hearing-impaired callers can use the AT&T Relay Service TTY at 1-800-855-2880. For telephone system access, you must enter the last four digits of your Social Security Number (SSN), your date of birth, and your phone PIN.
• ARCONIC4U Customer service representatives – These specially-trained individuals are available weekdays from 9 a.m. to 5 p.m. Eastern Time by calling 1-844-9ARCONIC (1-844-927-2664). The representatives can answer any questions you may have about the Plan.

 

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