Exhibit 10 (llll)
 
 

 
 
 
 
NORTH VALLEY BANCORP
EMPLOYEE STOCK OWNERSHIP PLAN
 
EFFECTIVE JANUARY 1, 2010
 
 
 
 

 
 
 

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NORTH VALLEY BANCORP
EMPLOYEE STOCK OWNERSHIP PLAN
 
TABLE OF CONTENTS

 

   
Page
     
ARTICLE I.
NAME, PURPOSE AND EFFECTIVE DATE
2
1.01
Name
2
1.02
Purpose
2
1.03
Exclusive Benefit
2
1.04
Employment
2
1.05
Effective Date
2
ARTICLE II.
DEFINITIONS
3
2.01
Account
3
2.02
Administrative Committee
4
2.03
Affiliated Employer
4
2.04
Alternate Payee
4
2.05
Aggregation Group
5
2.06
Annual Addition
5
2.07
Associated Company
5
2.08
Beneficiary
5
2.09
Board
5
2.10
Break In Service
5
2.11
Code
6
2.12
Company
6
2.13
Company Stock
6
2.14
Compensation
7
2.15
Contribution
7
2.16
Date Of Reemployment
7
2.17
Deemed Owned Shares
7
2.18
Determination Date
7
2.19
Disability
7
2.20
Direct Rollover
8
2.21
Distributee
8
2.22
Disqualified Person
8
2.23
Eligible Employee
8
2.24
Eligible Participant
8
2.25
Eligible Retirement Plan
9
2.26
Eligible Rollover Distribution
9
2.27
Eligibility Computation Period
9
2.28
Employee
9
2.29
Employer
9
2.30
Employment Commencement Date
9
2.31
Entry Date
9

 
 
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2.32
ERISA
9
2.33
Family Member
10
2.34
Forfeiture
10
2.35
Highly Compensated Employee
10
2.36
Hour Of Service
11
2.37
Inactive Participant
11
2.38
Key Employee
11
2.39
Leased Employee
12
2.40
Limitation Account
12
2.41
Limitation Year
13
2.42
Nonallocation Year
13
2.43
Non-Key Employee
13
2.44
Normal Retirement Age
13
2.45
Owner
13
2.46
Participant
13
2.47
Permissive Aggregation Group
13
2.48
Plan
13
2.49
Plan Administrator
14
2.50
Plan And Trust Document
14
2.51
Plan Year
14
2.52
Qualified Domestic Relations Order (QDRO)
14
2.53
Qualified Participant
14
2.54
Qualified Election Period
14
2.55
Required Aggregation Group
14
2.56
Service
14
2.57
Termination Of Employment
14
2.58
Top-Heavy Plan
15
2.59
Trust
15
2.60
Trustee(s)
15
2.61
Trust Fund
15
2.62
Valuation Date
15
2.63
Vesting Computation Period
15
2.64
Year Of Service
15
ARTICLE III.
ELIGIBILITY, PARTICIPATION AND BENEFICIARY DESIGNATION
16
3.01
Entry And Participation
16
3.02
Inactive Participant
16
3.03
Reemployment
16
3.04
Administrative Committee Control
17
3.05
Combination Of Plan
17
3.06
Integration
17
3.07
Omission Of Eligible Employee
17
3.08
Inclusion Of Ineligible Participant
17
3.09
Beneficiaries
18

 
 
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ARTICLE IV.
CONTRIBUTIONS
19
4.01
Company Contributions
19
4.02
Participants’ Optional Investment Contributions
20
ARTICLE V.
ALLOCATION OF CONTRIBUTIONS AND FORFEITURES
20
5.01
Allocation To Accounts
20
5.02
Reduction For Other Pension Plan Contributions
24
5.03
Limitations On Contributions - Annual Addition
24
5.04
Restoration Procedures
27
5.05
Prohibited Allocations Of Stock
27
5.06
Allocation Limitation – More Than One (1) Defined Contribution Plan
28
5.07
Prohibited Allocation Of Stock For S Corporations
29
ARTICLE VI.
VESTING OF ACCOUNTS
31
6.01
Accelerated Vesting
31
6.02
Regular Vesting
31
6.03
Years Of Service
32
6.04
Forfeitures
33
6.05
Divestment
35
6.06
Absence Of Participant
35
6.07
No Reduction In Vesting
35
6.08
Amendments To Vesting Schedule
36
ARTICLE VII.
TOP-HEAVY PLAN RULES
37
7.01
Special Definitions
37
7.02
Top-Heavy Status
38
7.03
Benefits Taken Into Account
39
7.04
Top-Heavy Plan Contribution Limitation
39
7.05
Top-Heavy Vesting
40
ARTICLE VIII.
ALLOCATION OF TRUST INCOME OR LOSS
41
8.01
Allocation At Valuation Date
41
8.02
Limitation And Suspense Accounts
42
8.03
Separate Valuation
43
8.04
Valuation Of Trust Fund
43
8.05
Rebalancing Of Investments Of Cash And Company Stock To Prohibit A Nonallocation
Year
43
ARTICLE IX.
PARTICIPANTS’ ACCOUNTS
44
9.01
Accounts
44
9.02
Value Of Accounts
44
9.03
Statement Of Account
44
ARTICLE X.
DISTRIBUTIONS
45
10.01
Benefits From Trust
45
10.02
Form Of Distribution
45
10.03
Undistributed Amounts Upon Death
46
10.04
Deferred Cash Distributions
46
10.05
Deferred Non-Cash Distribution
46
10.06
Distribution To Minor Or Incompetent Person
47
10.07
Right Of First Refusal
47

 
 
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10.08
Put Option
48
10.09
Timing Of Distributions
49
10.10
Distributions – General Provisions
51
10.11
Eligible Rollover Distributions
52
10.12
Other Rights And Options
54
ARTICLE XI.
SERVICE
54
11.01
Service
54
11.02
Hours Of Service
54
11.03
Crediting Of Hours Subject To Regulation
56
11.04
Uniformed Services Employment And Reemployment Rights Act Of 1994
57
ARTICLE XII.
FIDUCIARY RESPONSIBILITY
57
12.01
Authority
57
12.02
Interest Of Participants And Beneficiaries
57
12.03
Liability
58
12.04
Dual Capacities
58
12.05
Allocation Of Authority
58
12.06
Prohibited Transaction
59
ARTICLE XIII.
ADMINISTRATIVE COMMITTEE
59
13.01
Administrative Committee
59
13.02
Action
59
13.03
Records
60
13.04
Power
60
13.05
Funding Policy
61
13.06
Agents
61
13.07
Claims
61
13.08
Indemnity
64
13.09
Administrative Committee Duties
64
ARTICLE XIV.
INVESTMENTS
65
14.01
Investment Objective
65
14.02
Investment Directives
65
14.03
Delegation Of Authority
65
14.04
Participant Voting And Exercise Of Stock Rights
66
14.05
Loans
67
14.06
Diversification
68
ARTICLE XV.
TRUSTEE(S)
69
15.01
Application of Trust Provisions
69
15.02
Duties
69
15.03
Ownership
70
15.04
Powers
70
15.05
Fees
70
15.06
Accounting
71
15.07
Resignation
71
15.08
Effect Of Final Accounting
72
15.09
Vacancy And Successors
72
15.10
Legal Counsel
72

 
 
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15.11
Investigation
72
15.12
Unanimous Vote
73
15.13
Indemnification
73
ARTICLE XVI.
AMENDMENT, TERMINATION AND MERGER
73
16.01
Irrevocable Trust
73
16.02
Amendment
73
16.03
Contributions
74
16.04
Termination
74
16.05
Distribution Upon Termination
75
16.06
Qualification Notice
75
16.07
Reversion
76
16.08
Merger
76
ARTICLE XVII.
ASSIGNMENTS
76
17.01
Alienation And QDROs
76
ARTICLE XVIII.
MISCELLANEOUS PROVISIONS
78
18.01
Governing Law
78
18.02
Gender
78
18.03
Amendment Of Laws
78
18.04
Interpretations
78

 
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NORTH VALLEY BANCORP

EMPLOYEE STOCK OWNERSHIP PLAN

North Valley Bancorp, a California corporation (Company) adopts the Plan as
follows:

RECITALS

           
A.
The Company adopted the North Valley Bancorp Employee Stock Ownership Plan and
Trust (Plan) effective January 1, 1977, and was subsequently amended and
restated effective September 30, 1981 and January 1, 1987.
           
B.
The Company amended and restated the Plan effective January 1, 1999, except as
otherwise provided in the Plan, to adopt the technical changes necessary for the
Plan to conform with changes in the law enacted by the General Agreement on
Tariffs and Trade (GATT), Uniformed Services Employment and Reemployment Rights
Act of 1994 (USERRA), Small Business Job Protection Act of 1996 (SBJPA),
Taxpayer Relief Act of 1997 (TRA 97), and the Community Renewal Tax Relief Act
of 2000 (CRA).
           
C.
The Internal Revenue Service (IRS) issued a determination letter approving the
terms of the Plan, as amended on March 29, 2000.
           
D.
The Company amended the Plan to adopt the technical changes necessary for the
Plan to conform with changes in the law enacted by the Economic Growth And Tax
Relief Reconciliation Act of 2001 (EGTRRA), Job Creation and Worker Assistance
Act of 2002 (JCWAA), final Treasury Regulations under Code section 401(a)(9)
published on April 16, 2002 and final guidance under EGTRRA for distributions
made on or after March 28, 2005, in accordance with Internal Revenue Code (Code)
section 401(a)(31)(B).
           
E.
The Company amended the Plan on December 21, 2006, effective January 1, 2006, to
restate the Plan document to adopt the technical changes necessary for the Plan
to comply with the vesting requirements of the Pension Protection Act of 2006,
to consolidate all of the technical and design changes and to amend the Plan,
which has been a stock bonus plan, into an employee stock ownership plan within
the meaning of Code section 4975(e)(7).
           
F.
The December 21, 2006 Plan restatement inadvertently included a vesting schedule
for the Plan Year ending on December 31, 2006 that did not comply with the
requirements of Code section 411.
           
G.
The Company then retroactively amended and restated the ESOP within the remedial
amendment period under Code section 401(b) and the Treasury Regulations
thereunder to reflect the proper vesting schedule that is required under Code
section 411 for the Plan Year ending on December 31, 2006.

 
 
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H.
The Employer then amended the ESOP, effective January 1, 2008, to comply with
the Final Regulations under Code section 415 and to comply with the rollover
distribution requirements enacted by the Pension Protection Act of 2006.
           
I.
The Employer now wishes to amend and restate the ESOP in order to submit the
ESOP to the IRS for an updated determination letter, and also to make any
necessary legal updates.
           
ARTICLE I. NAME, PURPOSE AND EFFECTIVE DATE
           
1.01
Name.
             
The name of this Plan and Trust shall be the North Valley Bancorp Employee Stock
Ownership Plan.
           
1.02
Purpose.
             
This Plan and Trust are intended to qualify under Code sections 401(a) and
501(a) and are created to enable Eligible Employees of the Company to acquire
shares of Company Stock and to provide retirement funds and benefits in the
event of Disability. This Plan and Trust are intended to constitute a stock
bonus employee stock ownership plan (ESOP), within the meaning of Code section
4975(e)(7) and section 407(d)(6) of the Employee Retirement Income Security Act
of 1974 (ERISA), which will invest primarily in Company Stock pursuant to
Sections 407(b)(1) and 407(d) of ERISA.
           
1.03
Exclusive Benefit.
             
This Plan has been created and all assets acquired under this Plan as a result
of Contributions, income and other additions to the Trust will be administered,
distributed, forfeited and otherwise governed by the provisions of this Plan and
shall be administered by the Administrative Committee for the exclusive benefit
of the Participants in the Plan and their Beneficiaries.
           
1.04
Employment.
             
Nothing contained in this Plan and Trust Document is intended nor shall it be
deemed to create a contract between the Company and any Employee. This Plan and
Trust Document shall not affect any rights or obligations of the Company or any
Employee to continue or terminate employment.
           
1.05
Effective Date.
             
The initial effective date of this Plan is January 1, 1977.

 
 
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This Plan and Trust Document as restated, is effective January 1, 2010, except
as specifically noted elsewhere in this Plan.
           
ARTICLE II. DEFINITIONS
           
The following words and phrases used in this Plan and Trust Document shall have
the meanings described below, unless the context clearly requires a different
meaning:
           
2.01
Account.
             
“Account” means the aggregate of all records maintained by the Administrative
Committee for purposes of determining a Participant’s or Beneficiary’s interest
in the fund and shall include the Company Stock Account, General Account,
Suspense Account and any other accounts established by the Administrative
Committee.
             
Each Account shall also have corresponding subaccounts which shall be maintained
by the Administrative Committee as it deems necessary for purposes including,
but not limited to, distinguishing that portion of an Account attributable to
Plan Years during which the Plan is a Top-Heavy Plan or during which the
Participant is a Key Employee in a Top-Heavy Plan or is a Five Percent (5%)
Owner of the Employer. Subaccounts may be maintained by the Administrative
Committee for amounts contributed and held in the Plan attributable to
predecessor plans of the Employer.
             
A.
Company Stock Account.
               
“Company Stock Account” means that portion of a Participant’s Account which is
credited with shares of Company Stock which are purchased and paid for by the
Trust, contributed to the Trust, allocated as forfeitures and stock dividends
paid with respect to Company Stock held in the Participant’s Company Stock
Account.
             
B.
ESOP Account.
               
“ESOP Account” means the Participant’s Company Stock Account and General
Account.
             
C.
General Account.
               
“General Account,” formerly known as the “Other Investments Account” means that
portion of a Participant’s Account that is credited with:
               
1.
Company Contributions of cash;
               
2.
Forfeitures other than of Company Stock;

 
 
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3.
Cash dividends paid with respect to Company Stock held in the Participant’s
Company Stock Account;
               
4.
Cash distributions paid with respect to Company Stock held in the Participant’s
Company Stock Account for any Plan Year during which the Company has elected to
be treated as an S Corporation for federal income tax purposes under the Code;
and
               
5.
The Participant’s share of such other Trust income, gains or losses properly
credited to such Account pursuant to the terms of this Plan and Trust Document.
               
The General Account shall be debited with amounts paid by the Trustee(s) for the
purchase of Company Stock or for repayment of debt incurred by the Company or
Plan for the purchase of Company Stock.
             
D.
Suspense Account.
               
“Suspense Account” means an account established pursuant to the provisions of
the Vesting Of Accounts or Allocation Of Contributions And Forfeitures articles,
pertaining to securities purchased with an exempt loan.
           
2.02
Administrative Committee.
             
“Administrative Committee” means the Administrative Committee designated under
the Administrative Committee article.
           
2.03
Affiliated Employer.
             
“Affiliated Employer” shall have the meaning described in the Top-Heavy Plan
Rules article. For purposes of this Plan, all Employees of an Affiliated
Employer shall be treated as employed by a single employer, except to the extent
permitted by Code section 414(r); provided, however, that the Employees of an
Affiliated Employer shall not participate in this Plan unless the Affiliated
Employer has also adopted this Plan.
           
2.04
Alternate Payee.
             
“Alternate Payee” means any spouse, former spouse, child or other dependent of a
Participant recognized by a domestic relations order as having a right to
receive all, or a portion of, a Participant’s benefits under the Plan.

 
 
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2.05
Aggregation Group.
             
“Aggregation Group” means either a Required Aggregation Group or a Permissive
Aggregation Group, described in the Top-Heavy article.
           
2.06
Annual Addition.
             
“Annual Addition” shall have the meaning described in the Allocation Of
Contributions And Forfeitures article.
           
2.07
Associated Company.
             
“Associated Company” means the Employer and any corporation which is a member of
a controlled group of corporations (as defined in Code section 414(b)) which
includes the Employer; any trade or business (whether or not incorporated) which
is under common control (as defined in Code section 414(c)) with the Employer;
an organization (whether or not incorporated) which is a member of an affiliated
service group (as defined in Code section 414(m)) which includes the Employer;
and any other entity required to be aggregated with the Employer pursuant to
regulations under Code section 414(o).
           
2.08
Beneficiary.
             
“Beneficiary” means any one or more primary or contingent beneficiaries entitled
under the provisions of this Plan to receive benefits after the death of a
Participant, as limited by the Beneficiaries article.
           
2.09
Board.
             
“Board” means the Board of Directors of the Company.
           
2.10
Break In Service.
             
“Break in Service” means a Plan Year in which a Participant does not complete
more than five hundred (500) Hours Of Service with the Employer. An Employee
shall not incur a Break in Service for the Plan Year in which the Employee
becomes a Participant, dies, retires or suffers a disability under the
Disability Retirement article, below. Further, solely for the purpose of
determining whether a Participant has incurred a Break in Service, Hours Of
Service shall be recognized for an “authorized leave of absence” and a
“maternity or paternity leave of absence.” “Authorized leave of absence” means
an unpaid, temporary cessation from active employment with the Employer pursuant
to an established nondiscriminatory policy, whether occasioned by illness,
military service or any other reason. A “maternity or paternity leave of
absence” means an absence from work for any period by reason of the Employee’s
pregnancy, birth of the Employee’s child, placement of a child with the Employee
in connection with the adoption of such child by the Employee, or any absence
for the purpose of caring for such child for a period immediately following such
birth or placement. For this purpose, Hours Of Service shall be credited for the
computation period in which the absence from work begins only if credit therefor
is necessary to prevent the Employee from incurring a Break in Service, or, in
any other case, in the immediately following computation period. The Hours Of
Service credited for a maternity or paternity leave of absence shall be those
which would normally have been credited but for such absence, or, in any case in
which the Administrator is unable to determine such hours normally credited,
eight (8) Hours Of Service per day. The total Hours Of Service required to be
credited for a maternity or paternity leave of absence shall not exceed five
hundred one (501).

 
 
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2.11
Code.
             
“Code” means the Internal Revenue Code of 1986, as amended.
           
2.12
Company.
             
“Company” means North Valley Bancorp and any successors or assigns and
Associated Companies that expressly adopt this Plan and Trust Document and agree
in writing to its terms.
           
2.13
Company Stock.
             
“Company Stock” means qualifying employer securities as defined in Code sections
4975(e)(8) and 409(l) as follows:
             
A.
The term “Qualifying Employer Securities” means common stock issued by the
Company (or by a corporation which is a member of the same controlled group)
that is readily tradable on an established securities market.
             
B.
If there is no common stock which meets the requirements of paragraph A, above,
the term “Qualifying Employer Securities” means common stock issued by the
Company (or by a corporation which is a member of the same controlled group)
having a combination of voting power and dividend rights equal to or in excess
of:
               
1.
That class of common stock of the Company (or of any other such corporation
which is a member of the same controlled group) having the greatest voting
power; and
               
2.
That class of common stock of the Company (or of any other such corporation
which is a member of the same controlled group) having the greatest dividend
rights.

 
 
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Non-callable preferred stock shall be treated as Company Stock for purposes of
the Plan if such stock is convertible at any time into stock that is readily
tradable on an established securities market (or, if applicable, that meets the
requirements of (a) and (b) next above) and if such conversion is at a
conversion price that, as of the date of the acquisition by the Plan, is
reasonable. For purposes of the immediately preceding sentence, preferred stock
shall be treated as non-callable if, after the call, there will be a reasonable
opportunity for a conversion that meets the requirements of the immediately
preceding sentence. Company Stock shall be held under the Trust only if such
stock satisfies the requirements of section 407(d)(5) of ERISA
           
2.14
Compensation.
             
“Compensation” shall have the meaning described in the Allocations Of
Contributions And Forfeitures article.
           
2.15
Contribution.
             
“Contribution” means the Company’s Contribution or a Participant’s Contribution
as described in Contributions article.
           
2.16
Date Of Reemployment.
             
Date of Reemployment means the date on which a former Employee first performs an
Hour Of Service for the Employer after the Employee’s reemployment.
           
2.17
Deemed Owned Shares.
             
“Deemed Owned Shares” shall have the meaning described in the Prohibited
Allocation Of Stock For S Corporations article.
           
2.18
Determination Date.
             
“Determination Date” shall have the meaning described in the Top-Heavy article.
           
2.19
Disability.
             
“Disability” means total and permanent disability of a Participant, by reason of
physical or mental illness, resulting in the inability to perform any gainful
employment resulting in his Termination of Employment with the Company, and
which is determined by the Social Security Administration to constitute total
and permanent disability under the federal Social Security Act.

 
 
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2.20
Direct Rollover.
             
“Direct Rollover” shall have the meaning described in the Distributions article.
           
2.21
Distributee.
             
“Distributee” shall have the meaning described in the Distributions article.
           
2.22
Disqualified Person.
             
“Disqualified Person” shall have the meaning described in the Prohibited
Allocation Of Stock For S Corporations article.
           
2.23
Eligible Employee.
             
“Eligible Employee” means any Employee of the Company that is salaried, paid by
the hour or on a commission.
             
“Eligible Employee” shall not include Employees who are Leased Employees as
defined in Code section 414(n).
             
“Eligible Employee” shall not include independent contractors and each
individual whom the Employer treats as if he or she were an independent
contractor even if he or she might otherwise satisfy certain of the legal tests
or criteria to be considered a common law employee of the Employer.
             
“Eligible Employee” shall only include Employees who are age eighteen (18) or
older.
           
2.24
Eligible Participant.
             
“Eligible Participant” means:
             
An Eligible Employee who is a Participant and is credited with one thousand
(1,000) or more Hours of Service in the Plan Year and is an Eligible Employee on
the last day of the Plan Year.
             
A Participant who was an Eligible Employee and who Terminated Employment during
the Plan Year due to death, Disability, reaching Normal Retirement Age, or any
other reason, shall be an Eligible Participant only if he is credited with one
thousand (1,000) or more Hours of Service in the year of such Termination of
Employment and is an Eligible Employee on the last day of the Plan Year.

 
 
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2.25
Eligible Retirement Plan.
             
“Eligible Retirement Plan” shall have the meaning described in the Distributions
article.
           
2.26
Eligible Rollover Distribution.
             
“Eligible Rollover Distribution” shall have the meaning described in the
Distributions article.
           
2.27
Eligibility Computation Period.
             
“Eligibility Computation Period” means the twelve (12) consecutive month period
beginning on the Employee’s Employment Commencement Date, and each anniversary
thereof.
           
2.28
Employee.
             
“Employee” means an individual who is employed by the Company, including
officers, any portion of whose income from the Company is subject to income tax
withholding or for whom Social Security contributions are made by the Employer,
as well as any other individual qualifying as a common law employee of the
Company; provided, however, that “Employee” shall exclude directors not employed
by the Company in any other capacity.
           
2.29
Employer.
             
“Employer” means the Company which employs the Employee.
           
2.30
Employment Commencement Date.
             
“Employment Commencement Date” means the date on which an Employee first
performs an Hour of Service for the Company.
           
2.31
Entry Date.
             
“Entry Date” means the first day of the Plan Year on which an Eligible Employee
enters the Plan pursuant to the Eligibility, Participation And Beneficiary
Designation article.
           
2.32
ERISA.
             
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 
 
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2.33
Family Member.
             
“Family Member” shall have the meaning described in the Prohibited Allocation Of
Stock For S Corporations article.
           
2.34
Forfeiture.
             
“Forfeiture” means a nonvested amount forfeited from an Employee’s Account
pursuant to the provisions of the Vesting Of Accounts article.
           
2.35
Highly Compensated Employee.
             
A “Highly Compensated Employee” for a Plan Year means a highly compensated
active Employee and a highly compensated former Employee.
             
A.
A highly compensated active Employee for a Plan Year includes any Employee who
performs service for the Employer during the Plan Year and who:
               
1.
Was a Five Percent (5%) Owner (as defined in Code section 416(i)(1)) of the
Employer at any time during the Plan Year or the prior Plan Year, or
               
2.
For the prior Plan Year had compensation from the Employer in excess of one
hundred five thousand dollars ($105,000) (as adjusted pursuant to Code section
415(d)) and, if the Employer elects for such prior Plan Year, was in the
Top-Paid Group of Employees for the prior Plan Year.
                 
In determining who is a Highly Compensated Employee, an Employee is in the
“Top-Paid Group” of Employees for any Plan Year if such Employee is in the group
consisting of the top twenty percent (20%) of the Employees when ranked on the
basis of compensation (as defined in Code section 414(q)(4)) paid during such
year. For purposes of determining the number of Employees in the Top-Paid Group,
the following Employees shall be excluded:
                 
a.
Employees who have not completed six (6) months of service;
                 
b.
Employees who normally work less than seventeen and one-half (17-1/2) hours per
week;
                 
c.
Employees who normally work during not more than six (6) months during any year;

 
 
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d.
Employees who have not attained age twenty-one (21); and
                 
e.
Except to the extent provided in the Treasury Regulations, Employees who are
included in a unit of Employees covered by an agreement which the Secretary of
Labor finds to be a collective bargaining agreement between employee
representatives and the Employer.
             
B.
A highly compensated former Employee for a Plan Year includes any Employee who
Terminated Employment (or was deemed to have Terminated Employment) prior to
such Plan Year, performs no services for the Employer during such Plan Year, and
was a Highly Compensated Active Employee for either the Plan Year during which
the Termination of Employment occurred (or was deemed to have occurred) or any
Plan Year ending on or after the Employee’s fifty-fifth (55th) birthday.
             
C.
The determination of who is a Highly Compensated Employee, including the
determination of the number and identity of Employees in the Top-Paid Group and
the compensation that is considered, will be made in accordance with Code
section 414(q) and the regulations promulgated thereunder.
             
D.
The Employer has elected to exclude Employees in the “Top-Paid Group” of
Employees from the definition of Highly Compensated Employee.
           
2.36
Hour Of Service.
             
“Hour of Service” shall have the meaning described in the Service article.
           
2.37
Inactive Participant.
             
“Inactive Participant” means a Participant who Terminated Employment or who
ceases to be an Eligible Employee and who has not yet received a complete
distribution of his Accounts from the Plan.
           
2.38
Key Employee.
             
“Key Employee” means any Employee or former Employee (including any deceased
employee) who at any time during the Plan Year that includes the Determination
Date was an officer of the Employer having annual compensation greater than one
hundred forty thousand dollars ($140,000) (as adjusted under Code section
416(i)(1) for Plan Years beginning after December 31, 2002), a Five Percent (5%)
Owner of the Employer, or a One Percent (1%) Owner of the Employer having annual
compensation of more than two hundred twenty thousand dollars ($220,000). For
this purpose, annual compensation means compensation within the meaning of Code
section 415(c)(3). The determination of who is a Key Employee will be made in
accordance with Code section 416(i)(1) and the applicable regulations and other
guidance of general applicability issued thereunder.

 
 
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A Beneficiary of a Key Employee shall be considered to be a Key Employee. The
Administrative Committee shall be guided by the provisions of applicable law,
regulations and guidelines in determining Key Employees for any Plan Year and
shall maintain records adequate to determine Key Employees for any Plan Year.
           
2.39
Leased Employee.
             
“Leased Employee” means any person who is not an Employee of the Employer and
who provides services to the Employer if:
             
A.
Such services are provided pursuant to an agreement between the Employer and the
leasing organization;
             
B.
Such person has performed such services for the Employer or related persons on a
substantially full-time basis for a period of at least one (1) year; and
             
C.
Such services are performed under primary direction or control by the Employer.
             
“Leased Employee” shall not include a person who is covered under a money
purchase pension plan maintained by the leasing organization that provides for:
             
A.
A nonintegrated employer contribution rate of at least ten percent (10%) of
compensation, as defined in Code section 415(c)(3);
             
B.
Immediate participation (except for employees who perform substantially all of
their services for the leasing organization and except for an individual whose
compensation from the leasing organization in each Plan Year during the four (4)
year period ending with the Plan Year is less than one thousand dollars
($1,000); and
             
C.
Full and immediate vesting; but only if Leased Employees, determined without
regard to this subparagraph do not constitute more than twenty percent (20%) of
the Employer’s “nonhighly compensated workforce” (as defined in Treasury
Regulations section 1.414(n)-2(f)(3)(ii)).
           
2.40
Limitation Account.
             
“Limitation Account” means an account maintained in accordance with the
provisions of the Allocation Of Contributions And Forfeitures article.

 
 
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2.41
Limitation Year.
             
“Limitation Year” means the Plan Year.
           
2.42
Nonallocation Year.
             
“Nonallocation Year” shall have the meaning described in the Prohibited
Allocation Of Stock For S Corporations article.
           
2.43
Non-Key Employee.
             
“Non-Key Employee” means any Employee or former Employee (and the Employee’s
Beneficiaries) who is not a Key Employee.
           
2.44
Normal Retirement Age.
             
Normal Retirement Age” means age sixty-five (65) or fifty-five (55) with ten
(10) years of service.
           
2.45
Owner.
             
“Owner” means any person who owns or has owned at any time during the Plan Year
under consideration a portion of the outstanding stock or voting power of the
Employer. The ownership percentage of a “Five Percent (5%) Owner” means greater
than a five percent (5%) interest and means greater than a one percent (1%)
interest for a “One Percent (1%) Owner.”
           
2.46
Participant.
             
“Participant” means any Eligible Employee who has entered the Plan in accordance
with the Eligibility, Participation And Beneficiary Designation article, and
whose Account hereunder has not subsequently been liquidated and distributed.
           
2.47
Permissive Aggregation Group.
             
“Permissive Aggregation Group” shall have the meaning described in the Top-Heavy
article.
           
2.48
Plan.
             
“Plan” means the Plan created by this Plan and Trust Document.

 
 
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2.49
Plan Administrator.
             
“Plan Administrator” means the Administrative Committee designated under the
Administrative Committee article.
           
2.50
Plan And Trust Document.
             
“Plan and Trust Document” means this document and the associated trust
agreement, if any.
           
2.51
Plan Year.
             
“Plan Year” means the accounting year of the Plan and Trust, which shall be the
twelve (12) month period ending December 31.
           
2.52
Qualified Domestic Relations Order (QDRO).
             
“Qualified Domestic Relations Order (QDRO)” shall have the meaning described in
the Assignments article.
           
2.53
Qualified Participant.
             
“Qualified Participant” shall have the meaning described in the Investments
article.
           
2.54
Qualified Election Period.
             
“Qualified Election Period” shall have the meaning described in the Investments
article.
           
2.55
Required Aggregation Group.
             
“Required Aggregation Group” shall have the meaning described in the Top-Heavy
article.
           
2.56
Service.
             
“Service” shall have the meaning described in the Service article.
           
2.57
Termination Of Employment.
             
“Termination of Employment,” “Terminates” or “Terminates Employment” means the
date on which an Employee ceases working for the Employer for any reason,
including voluntary or involuntary discharge before or after reaching Normal
Retirement Age, or due to death or Disability.

 
 
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2.58
Top-Heavy Plan.
             
“Top-Heavy Plan” shall have the meaning described in the Top-Heavy article.
           
2.59
Trust.
             
“Trust” means the legal entity created by this Plan and Trust Document as part
of the Plan, and any associated trust agreement.
           
2.60
Trustee(s).
             
“Trustee(s)” means the Delaware Charter Guarantee and Trust Company conducting
business as Principal Trust Company or any duly appointed successor(s), as
provided in the Trustee(s) article.
           
2.61
Trust Fund.
             
“Trust Fund” means all property and income held by the Trustee(s) under this
Plan and Trust Document. “General Trust Fund” means that portion of the Trust
Fund other than assets representing shares of Company Stock. “Company Stock
Fund” means that portion of the Trust Fund held as shares of Company Stock.
           
2.62
Valuation Date.
             
“Valuation Date” means the last day of each Plan Year, and such other date or
dates as may be designated in the Administrative Committee’s discretion pursuant
to the Allocation Of Trust Income Or Loss article, for the revaluation of
Participants’ Accounts.
           
2.63
Vesting Computation Period.
             
A “Vesting Computation Period” means the Plan Year. Vesting Computation Periods
shall be counted for vesting beginning with the Plan Year which includes the
Employee’s Employment Commencement Date and each subsequent Plan Year
thereafter. To be credited with a Year of Service for vesting, the Employee must
complete at least one thousand (1,000) Hours Of Service during a Plan Year.
             
Service as set forth below with the following predecessor employer(s) shall be
recognized for vesting: Six Rivers National Bank and Yolo Community Bank.
           
2.64
Year Of Service.
             
“Year Of Service” means a Plan Year in which the Employee completes at least one
thousand (1,000) Hours Of Service. Each Employee shall be credited with a Year
Of Service for each computation period during which the Employee completes one
thousand (1,000) Hours Of Service for purposes of eligibility, vesting and
benefit accrual.

 
 
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ARTICLE III. ELIGIBILITY, PARTICIPATION AND BENEFICIARY DESIGNATION
           
3.01
Entry And Participation.
             
Each Eligible Employee shall become a Participant in the Plan as of the first
day of the Plan Year following the Plan Year in which the Employee completes at
least six (6) months of continuous service regardless of the number of Hours of
Service performed, provided that the Employee is an Eligible Employee on the
Entry Date.
             
The Administrative Committee may adjust the Service requirement described in
this article, above, as necessary, to make the Plan available to a
newly-acquired Employee group, provided that the adjustment (1) is not more
restrictive than the above requirement, and (2) does not discriminate in favor
of Highly Compensated Employees.
           
3.02
Inactive Participant.
             
Accounts of Inactive Participants shall share in allocations of Contributions
and Forfeitures only to the extent provided in the Allocation Of Contributions
And Forfeitures article. Inactive Participant’s Accounts shall continue to be
adjusted by amounts properly credited or debited to such Accounts pursuant to
the Allocation Of Trust Income Or Loss article.
           
3.03
Reemployment.
             
A former Employee who is reemployed by the Company before incurring five (5)
consecutive Breaks in Service who previously was a Participant in this Plan,
shall again become a Participant as of the Date Of Reemployment as an Eligible
Employee or, if later, as of the January 1 next following the date on which he
satisfied such eligibility requirements.
             
A former Employee who is reemployed by the Company before incurring five (5)
Breaks in Service who had not satisfied the requirements to become a Participant
in this Plan before his Termination of Employment, shall become a Participant
pursuant to the Entry and Participation article, by completing six (6) months of
Service following reemployment.

 
 
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3.04
Administrative Committee Control.
             
Compliance with these eligibility requirements shall be determined by the
Administrative Committee. The Administrative Committee shall advise each
Employee of his or her entry into the Plan as a Participant. The Administrative
Committee shall also provide each Participant with a Summary Plan Description
not later than the later of (i) one hundred twenty (120) days of the adoption of
the Plan or (ii) ninety (90) days following the date the Participant enters the
Plan. If the Plan is materially amended, the Administrative Committee must
deliver a revised Summary Plan Description or Summary of Material Modifications
to each Participant no later than two hundred ten (210) days after the end of
the Plan Year in which the change is adopted.
           
3.05
Combination Of Plan.
             
The Plan may not be combined with any other defined benefit or defined
contribution plan, other than an ESOP in order to satisfy the non-discrimination
rules set forth in Code section 401(a).
           
3.06
Integration.
             
The Plan may not be integrated with social security.
           
3.07
Omission Of Eligible Employee.
             
If an Employee who should have been included as a Participant for a Plan Year
was erroneously omitted and discovery of the omission is made after the
contribution by the Employer is made and allocated and the forfeitures are
allocated (if appropriate), the Employer may make an additional contribution on
behalf of the omitted Employee in an amount equal to the sum of (i) the amount
which the Employer would have contributed on the omitted Employee’s behalf had
the omitted Employee not been omitted plus (ii) the amount of the forfeitures
that would have been allocated to the omitted Employee had the omitted Employee
not been omitted.
           
3.08
Inclusion Of Ineligible Participant.
             
If any person is erroneously included as a Participant in the Plan and discovery
of the erroneous inclusion is made after the contribution by the Employer is
made and allocated and the forfeitures are allocated (if appropriate), the
Employer may elect to treat the amount contributed on behalf of and the amount
allocated to the ineligible person plus any earnings thereon as a forfeiture for
the Plan Year in which the discovery is made and apply such amount in the manner
specified in the Forfeitures paragraph, below.

 
 
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3.09
Beneficiaries.
             
A.
Each Participant shall have the right to designate, on forms provided by the
Administrative Committee, a Beneficiary or Beneficiaries to receive the
Participant’s death benefits, and shall have the right, at any time, to revoke
such designation or to substitute another such Beneficiary or Beneficiaries
without the consent of any Beneficiary; provided, however, that a married
Participant and spouse shall both designate any non-spouse Beneficiary or
Beneficiaries, unless the spouse cannot be located or unless otherwise permitted
by law. Any designation by a married Participant and spouse of a non-spouse
Beneficiary must be made by the Participant in writing and be consented to in
writing by the Participant’s spouse. Such spouse’s written consent must
designate a Beneficiary who may not be changed without spousal consent (unless
the spousal consent expressly permits designations by the Participant without
any requirement of further spousal consent), acknowledge the effect of such
election, and be witnessed by a Plan representative or a notary public. Such
consent shall not be required if it is established to the satisfaction of the
Administrative Committee that the required consent cannot be obtained because
there is no spouse, the spouse cannot be located, or other circumstances that
may be prescribed by Treasury regulations. The election made by the Participant
and consented to by the Participant’s spouse may be revoked by the Participant
in writing without the consent of the spouse at any time prior to the
Participant’s death. Any new election must comply with the requirements of this
subparagraph. A former spouse’s waiver shall not be binding on a new spouse.
             
B.
If, upon the death of a Participant or Beneficiary, there is no valid
designation of Beneficiary on file, the Administrative Committee shall designate
as the Beneficiary, in order of priority:
               
1.
The surviving spouse;
               
2.
The surviving children, including adopted children, in equal shares, or their
issue by right of representation;
               
3.
Surviving parents, in equal shares; or
               
4.
The Participant’s heirs at law.
             
C.
If the Employee has designated the Employee’s spouse as the Employee’s
Beneficiary under this Agreement, such designation shall be deemed to have been
revoked in the event of a judgment, decree, order, or approval of a settlement
agreement, issued either (i) by a court of competent jurisdiction or (ii)
through an administrative process established under state law and that has the
force and effect of law under applicable state law, that dissolves such
marriage, unless the Employee designates the Employee’s ex-spouse as the
Employee’s Beneficiary by a new designation after the entry of such judgment,
decree, order or approval of a settlement agreement.

 
 
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ARTICLE IV. CONTRIBUTIONS
           
4.01
Company Contributions.
             
A.
The Company shall make a discretionary Contribution to the Trust in such amount
as is determined by its Board of Directors, to be credited to Plan Accounts as
of the last day of each Plan Year.
             
B.
Company Contributions to all Accounts in the ESOP shall not exceed an amount
which is estimated to constitute an allowable deduction under Code section
404(a), except as provided in this article. Any Company Contribution in excess
of the allowable deduction limit under Code section 404(a) may be held in the
Plan and carried over to the succeeding tax year and will apply towards the Code
section 404(a) deduction limit for the succeeding tax year. The Company
Contribution shall be reduced, if necessary, by any amount which could not be
allocated to the Account of any Participant of the Company in the preceding year
due to the limitations regarding Annual Additions, described in the Allocation
Of Contributions And Forfeitures article. Company Contributions shall be paid to
the Trustee(s) on or prior to the last day for filing the Company’s federal
income tax return for such year, including any extensions of time granted for
such filing. Contributions shall be made in cash or shares of Company Stock.
Contributions of shares of Company Stock shall be valued at their fair market
value, as described in the Allocation Of Trust Income Or Loss article, as of the
last day of the Plan Year, for which they are contributed.
             
C.
Except as provided below and as otherwise specifically permitted by law, it
shall be impossible by operation of the Plan or of the Trust, by termination of
either, by power of revocation or amendment, by the happening of any
contingency, by collateral arrangement or by any other means, for any part of
the corpus or income of any Trust Fund maintained pursuant to the Plan or any
funds contributed thereto to be used for, or diverted to, purposes other than
the exclusive benefit of Participants or their Beneficiaries; provided, however:
               
1.
In the case of a contribution which is made by an Employer by a mistake of fact,
the Trustee(s) may return such contribution to the Employer within one (1) year
after the payment of the contribution.

 
 
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2.
All contributions to the Plan are conditioned upon deductibility of the
contribution under Code section 404. To the extent that the deduction is
disallowed, the Trustee(s) shall return to the Employer such contribution, to
the extent disallowed, within one (1) year after the disallowance of the
deduction.
               
3.
Upon termination of the Plan, if there is any balance remaining in the Trust
after the satisfaction of all liabilities to the Participants and their
Beneficiaries, the Trustee(s) shall return said balance to the Employer.
           
4.02
Participants’ Optional Investment Contributions.
             
Participants shall not be entitled to make Contributions to the Trust. Rollovers
shall not be accepted from any plans.
           
ARTICLE V. ALLOCATION OF CONTRIBUTIONS AND FORFEITURES
           
5.01
Allocation To Accounts.
             
A.
Company Contributions, Forfeitures and amounts in Limitation Accounts for any
Plan Year shall be allocated as of the last day of such Plan Year to the Account
of each Eligible Participant, as more particularly described below in this
article, in the ratio that such Eligible Participant’s Compensation for such
Plan Year, bears to the aggregate Compensation of all Participants.
             
B.
The General Account of each Eligible Participant shall be credited as of the
last day of each Plan Year with its share of the Company’s cash Contributions
for such Plan Year and Forfeitures from General Accounts for such Plan Year. The
General Account shall be debited for any payments on purchases of Company Stock
or for repayments of debt (including principal and interest) incurred for the
purchase of Company Stock for such Plan Year.
             
C.
The Company Stock Account of each Participant shall be credited with the
proportionate share of Company Stock (including fractional shares) purchased and
paid for by the Trust or contributed in kind by the Company for such Plan Year
(except for shares held as part of a Suspense Account) and with the
proportionate share of any Forfeitures of Company Stock for such Plan Year, as
of the last day of each Plan Year.
             
D.
In the event of a purchase of Company Stock with an exempt loan, such Company
Stock shall be credited to a Suspense Account and shall be released and
allocated to Participants’ Company Stock Accounts only to the extent the related
debt has been paid by the Trustee(s). The number of shares to be released from
the Suspense Account and allocated to Participants’ Company Stock Accounts as of
any Valuation Date shall be determined by multiplying the total number of shares
remaining in the Suspense Account by a fraction, the numerator of which is the
total amount of all payments made during such year (including either principal
alone or principal and interest, as consistently applied in accordance with
applicable regulations, and as appropriate to the terms of any debt obligation
incurred under the Plan) and the denominator of which is the sum of the
numerator plus the principal and interest (as consistently applied in accordance
with applicable regulations and as appropriate to the terms of any debt
obligation incurred under the Plan) for all future years of the loan. The
Administrative Committee shall maintain adequate records of the aggregate cost
basis of Company Stock allocated to such Participant’s Company Stock Account. In
the event more than one (1) class of Company Stock is purchased with an exempt
loan, shares of different classes shall be released from encumbrance in equal
percentages.

 
 
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E.
“Compensation” means the total amount of all payments (without regard to whether
or not an amount is paid in cash) made by the Employer or an Affiliated Employer
to an Employee during a Limitation Year for personal services actually rendered
to the Employer or an Affiliated Employer in the course of employment with the
Employer or with an Affiliated Employer, to the extent that such amount is
includible in gross income, including but not limited to salary, bonuses,
overtime or premium pay and commissions, fringe benefits and all other amounts
described in either Treasury regulations section 1.415-2(d)(2) for Limitation
Years beginning before July 1, 2007 or Treasury regulations section
1.415(c)-2(b) for Limitation Years beginning on or after July 1, 2007 and
excluding those items set forth in either Treasury regulations section
1.415-2(d)(3) for Limitation Years beginning before July 1, 2007 or Treasury
regulations section 1.415(c)-2(c) for Limitation Years beginning on or after
July 1, 2007. “Compensation” shall include, for Limitation Years beginning after
December 31, 1997, elective deferrals as defined in Code section 402(g)(3) and
any amount that is not includible in an Employee’s gross income by reason of
Code section 125(a), Code section 457(b), or, for Limitation Years beginning on
or after January 1, 2001, Code section 132(f)(4).
               
1.
Differential Wage Payments.
                 
Effective as of January 1, 2009, “Compensation” shall include differential wage
payments to Participants on active duty to the extent required by the provisions
of Code section 414(u)(12)(A)(ii), the Treasury regulations thereunder and any
subsequent guidance issued under Code section 414(u)(12)(A)(ii).

 
 
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2.
Payments After Severance From Employment.
                 
“415 Compensation” includes amounts paid after the Employee’s severance from
employment if paid by the later of (i) two and one-half (2-1/2) months after the
Employee’s severance from employment, or (ii) the end of the Limitation Year
that includes the date of the Employee’s severance from employment subject to
the following requirements:
               
a.
The payment is regular compensation for services during the Employee’s regular
working hours, or compensation for services outside the Employee’s regular
working hours (such as overtime or shift differential), commissions, bonuses, or
other similar payments and the payment would have been made to the Employee
prior to a severance from employment if the Employee had continued in employment
with the Employer.
               
b.
The following amounts are excluded:
                   
(1)
Amounts paid for unused accrued bona fide sick, vacation, or other leave.
                   
(2)
Amounts received by the Employee pursuant to a nonqualified unfunded deferred
compensation plan.
               
3.
Compensation Limit.
                 
The annual compensation of each Employee taken into account under the Plan for
any year shall not exceed two hundred forty-five thousand dollars ($245,000) as
such amount may be adjusted by the Commissioner of Internal Revenue for
increases in the cost of living in accordance with Code section 401(a)(17)(B).
The cost of living adjustment in effect for a calendar year applies to any
period, not exceeding twelve (12) months, over which compensation is determined
(a ”determination period”) beginning in such calendar year. If a determination
period consists of fewer than twelve (12) months, the applicable compensation
limit determined under this subsection will be multiplied by a fraction, the
numerator of which is the number of months in the determination period and the
denominator of which is twelve (12).
               
4.
USERRA Compensation.
                 
For purposes of determining the Employer’s liability under section 4318(b)(1) of
chapter 43 of title 38, United States Code, as enacted by USERRA, an Employee’s
Compensation during the period of qualified military service shall be computed
at the rate the Employee would have received but for the period of qualified
military service.

 
 
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F.
Dividends on Company Stock held in a Participant’s Account shall be allocated to
that Participant’s General Account or Company Stock Account in cash or in shares
of Company Stock, quarterly or as of such other dates as determined by the
Committee. Cash dividends on unallocated shares of Company Stock used to make
payments on an exempt loan shall be allocated in accordance with the provisions
of the Allocation To Accounts article and by relative prior Account balances and
then applied to make payments on exempt loan. Cash dividends attributable to
unallocated shares of Company Stock (not used to make payments on an exempt
loan), including Company Stock acquired with an exempt loan and held in a
Suspense Account, shall be allocated among all General Accounts in the General
Trust Fund. A minimum of Company Stock with a fair market value equal to the
amount of cash dividends paid on allocated shares of Company Stock used to make
payments on an exempt loan shall be allocated to Participant’s Accounts. Any
dividends may, in the sole discretion of the Administrative Committee, be
distributed to the Participants or used to repay any exempt loan properly
obtained to acquire Company Stock.
             
 
1. For any year for which the Company has elected to be treated as an S
Corporation for federal income tax purposes under the Code, S Corporation
distributions on Company Stock held in a Participant’s Account shall be
allocated to that Participant’s General Account or Company Stock Account in cash
or in shares of Company Stock in proportion to the shares in the Participant’s
Company Stock Account on which such distributions were paid. Cash distributions
on unallocated shares of Company Stock used to make payments on an exempt loan
shall be allocated in accordance with the Allocation To Accounts article by
relative prior Company Stock Account balances and then applied to make payments
on the exempt loan. Shares released from the Suspense Account due to the payment
of such cash against the exempt loan shall be allocated to the Company Stock
Accounts in proportion the prior balances in the Company Stock Accounts. Cash
distributions attributable to unallocated shares of Company Stock not used to
make payments on an exempt loan, including Company Stock acquired with an exempt
loan and held in a Suspense Account, shall be allocated among all General
Accounts in the General Trust Fund. Any distributions may, in the sole
discretion of the Trustee(s), be retained and invested in the Trust Fund (in
Company Stock or other investments), or used to acquire additional shares of
Company Stock, from the Company or from any other person, including a party in
interest, to the extent in accordance with the terms of this Plan and ERISA,
generally, or used to repay any exempt loan properly obtained to acquire Company
Stock, in accordance with the Treasury Regulations under Code section 4975.

 
 
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2.
For purposes of all computations required by this article, the accrual method of
accounting shall be used to value the Trust Fund and the assets thereof at their
fair market value as of each Valuation Date. Company Stock shall be accounted
for as provided in Treasury Regulation section 1.402(a)-1(b)(2)(ii), as amended,
or any regulation or statute of similar import. A stock split of the securities
held by the Plan, shall not be considered income or appreciation of the Trust
Fund. All stock splits shall be recorded on the books of the Trust and shall
adjust the number of securities held in any account of the Plan effective on the
legal effective date of the stock split as determined by the issuer.
               
3.
From time to time, the Administrative Committee may modify the accounting
procedures for the purposes of achieving equitable and nondiscriminatory
allocations among the accounts of Participants in accordance with the general
concepts of the Plan, the provisions of this Article V and the requirements of
the Code and ERISA.
           
5.02
Reduction For Other Pension Plan Contributions.
             
If during a Plan Year, an Eligible Participant in this Plan has made any
elective deferrals to a cash or deferred arrangement maintained by the Company
for such year, the amount otherwise allocable in such year to such Participant’s
Account in accordance with the Allocation To Accounts article shall be reduced
pursuant to the Allocation Limitation—More Than One (1) Defined Contribution
Plan article, below; and the aggregate for such year of any such reductions in
allocations to such Participants shall be reallocated to the Accounts of all
Eligible Participants for such year, including those whose allocations were
reduced, pursuant to the Allocation to Accounts article; provided that any
Participant whose allocation was reduced shall not share in the reallocations if
the reduction under this article was greater than the total amount that would
otherwise have been allocable to such Participant under the Allocation to
Accounts article.
           
5.03
Limitations On Contributions - Annual Addition.
             
A.
Except to the extent otherwise permitted in the Restoration Procedures article
and for catch-up contributions under EGTRRA section 631 and Code section 414(v),
if applicable, the Annual Addition to a Participant’s Account for any Limitation
Year when aggregated with all contributions to all Plans maintained by the
Employer shall not exceed the lesser of:

 
 
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1.
Forty-nine thousand dollars ($49,000) (as adjusted for increases in the
cost-of-living under Code section 415(d)); or
               
2.
One hundred percent (100%) of the Participant’s 415 Compensation, within the
meaning of Code section 415(c)(3), for the Limitation Year.
               
The Compensation limit referred to in paragraphs 1 and 2, above, shall not apply
to any contribution for medical benefits after severance from employment (within
the meaning of Code section 401(h) or Code section 419A(f)(2)), which is
otherwise treated as an Annual Addition.
             
B.
“Annual Addition” means the sum of Employer contributions, voluntary Employee
contributions and Forfeitures allocated to the Accounts of a Participant under
this Plan and any other defined contribution plan of the Employer for the
Limitation Year to which the allocation pertains (whether or not allocated in
such year). If Company Stock has been acquired with an exempt loan, the Annual
Additions under Code section 415(c) may be calculated under either of two
methods:
               
1.
The amount of the Employer contributions to the ESOP used to repay a loan; or
               
2.
The value of the Company Stock allocated to participants if that amount is less
than the amount determined using Employer contributions.
               
If the Annual Additions are calculated with respect to Employer contributions,
appreciation in the value of Company Stock from the time it entered the Suspense
Account will not be counted for Code section 415 purposes pursuant to Treasury
regulations sections 54.4975–1 11(a)(8)(ii) and 54.4975–7(b)(8)(iii). If the
Company Stock is not acquired with an exempt loan, the fair market value of the
Company Stock is treated as an Annual Addition.
               
In any year for which the Company has not elected to be treated as an S
corporation for federal income tax purposes under the Code, if no more than
one-third (1/3) of the Company contribution for such year is allocated pursuant
to the Allocation To Accounts article to Highly Compensated Employees, Annual
Addition shall not include:
               
1.
Forfeitures of shares of Company Stock acquired with the proceeds of a loan; or

 
 
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2.
Company contributions used in repayment of interest on such a loan and debited
against such Participant’s Account.
             
C.
In the event that, as a result of the allocation of Forfeitures, a reasonable
error in estimating a Participant’s Compensation or other limited facts and
circumstances which the IRS finds to be applicable, an amount which would
otherwise be allocated would result in the Annual Addition limitation being
exceeded with respect to any Participant, the excess amount shall be eliminated:
               
1.
For Limitation Years beginning prior to July 1, 2007:
               
a.
First, by reallocating any remaining excess among the Accounts of all other
Eligible Participants for the Plan Year pursuant to the Allocation To Accounts
article; provided, however, that the Annual Addition has not already been
exceeded for all Eligible Participants; and
               
b.
Second, in the event that such a reallocation would cause the Annual Addition
limit to exceed with respect to any other Eligible Participant, the excess
amount remaining after the reallocation required by paragraph a, above, shall be
held unallocated in a Limitation Account and shall be reallocated to all
Eligible Participants pursuant to the Allocation To Accounts article as of the
last day of the next succeeding Plan Year. Amounts so held in Limitation
Accounts must be allocated to Participants’ Accounts before Company
contributions, which would be applicable to the Annual Addition are credited to
Accounts in succeeding years.
               
2.
For Limitation Years Beginning on or after July 1, 2007, if there is an excess
Annual Addition, the Employer and the Administrative Committee shall correct the
excess amount in accordance with the requirements of the Employee Plans
Compliance Resolution System set forth in Revenue Procedure 2006-27, and any
subsequent guidance thereto.
             
D.
Annual Additions for purposes of Code section 415 shall not include restorative
payments. A restorative payment is a payment made to restore losses to a plan
resulting from actions by a fiduciary for which there is a reasonable risk of
liability for breach of a fiduciary duty under ERISA or under other applicable
federal or state law, where participants who are similarly situated are treated
similarly with respect to the payments. Generally, payments are restorative
payments only if the payments are made in order to restore some or all of the
plan’s losses due to an action (or a failure to act) that creates a reasonable
risk of liability for such a breach of fiduciary duty (other than a breach of
fiduciary duty arising from failure to remit contributions to the Plan). This
includes payments to a plan made pursuant to a Department of Labor order, the
Department of Labor’s Voluntary Fiduciary Correction Program, or a
court-approved settlement, to restore losses to a qualified defined contribution
plan on account of the breach of fiduciary duty (other than a breach of
fiduciary duty arising from failure to remit contributions to the Plan) Payments
made to the Plan to make up for losses due merely to market fluctuations and
other payments that are not made on account of a reasonable risk of liability
for breach of fiduciary duty under ERISA are not restorative payments and
generally constitute contributions that are considered annual additions.

 
 
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5.04
Restoration Procedures.
             
A.
In the event that a Participant’s Account was improperly excluded in any Plan
Year from an allocation of Company contributions and Forfeitures pursuant to the
Allocation To Accounts article, such Participant’s Account shall be restored to
its correct status in the amount as follows:
               
1.
First, an amount which is computed on the same basis as the allocation of
Company contributions and Forfeitures which were properly allocated to Eligible
Participants under the Allocation To Accounts article in each year for which
restoration is necessary; and
               
2.
Second, an amount of Trust Fund income, gain or loss which is computed on the
same basis as the allocation of Trust Fund income, gain or loss which was
properly allocated to Participants’ Accounts under the Allocation At Valuation
Date article in each year for which restoration is necessary.
             
B.
The Company may contribute an additional amount which is necessary to fully
restore the Account of each of its improperly excluded Participants, or restore
the Account balance out of the current years contribution and forfeitures under
Company contributions and Forfeitures shall be allocated the Allocation To
Accounts article after the Account of each of the improperly excluded
Participants’ Accounts has been fully restored.
           
5.05
Prohibited Allocations Of Stock.
             
If any party sells Company Stock to this Plan (Seller) in any year during which
the Company has not elected to be an S Corporation for federal income tax
purposes under the Code, and following such sale at least thirty percent (30%)
of the total value of the Employer securities (within the meaning of Code
section 409(l)) outstanding as of the date of such sale is owned by this Plan
then such Seller, as well as any Participant who is a family member of such
Seller and any Participant who owns more than twenty-five percent (25%) in value
of any class of outstanding Employer securities (within the meaning of Code
section 409(l)) shall not be considered an Eligible Participant for purposes of
the allocation of such shares sold by such Seller unless such Seller files a
written certification with the Administrative Committee that such Seller will
not be electing the nonrecognition of gain provisions of Code section 1042 to
the proceeds of such sale.

 
 
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5.06
Allocation Limitation – More Than One (1) Defined Contribution Plan.
             
A.
If the Employer contributes to more than one (1) defined contribution plan and
as a result of the allocation of Forfeitures, a reasonable error in estimating a
Participant’s Compensation, a reasonable error in determining the amount of
elective deferrals under Code section 402(g)(3) or other limited facts and
circumstances which the IRS finds to be applicable, an amount which would
otherwise be allocated would result in the Annual Addition limitation being
exceeded with respect to any Participant, the excess amount shall be eliminated
as follows:
               
1.
Any nondeductible Employee voluntary contributions under any other defined
contribution plan, to the extent they would reduce the excess amount, will be
returned to the Participant.
               
2.
Any unmatched Employee salary deferrals under a cash or deferred arrangement
within the meaning of Code section 401(k), to the extent they would reduce the
excess amount, will be returned to the Participant. To the extent necessary to
further reduce the excess amount, all salary deferrals under a cash or deferred
arrangement within the meaning of Code section 401(k), whether or not there was
a corresponding matching contribution, will be returned to the Participant.
               
3.
If the sum of the Annual Additions to a Participant’s Accounts, in all plans,
considered as one (1), would exceed said limitations, and in the event that the
return to a Participant of the Participant’s contributions under the preceding
paragraphs, above, should still fail to alleviate such excess amount, then the
amount of such excess shall be reallocated in the profit sharing plan of the
Employer then in the defined contribution pension plan (or if more than one (1)
defined contribution pension plan, in the order selected by the Company).
             
B.
The otherwise permissible Annual Additions for any Participant under this Plan
may also be further reduced to the extent necessary as determined by the
Company, to prevent disqualification of benefits payable to Participants who
also may be participating in another tax-qualified pension, profit sharing,
savings or stock bonus plan of the Employer. The Employer shall advise affected
Participants of any additional limits on their Annual Additions required by the
foregoing.

 
 
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5.07
Prohibited Allocation Of Stock For S Corporations.
             
A.
No Company Stock of an S corporation may be allocated under this Plan during a
Nonallocation Year for the benefit of a Disqualified Person.
               
No Company Stock of an S corporation may be allocated under this Plan to a
Participant if such allocation would cause such Participant to become a
Disqualified Person and such event would cause the occurrence of a Nonallocation
Year.
               
No Company stock of an S corporation may be allocated under this Plan to a
Participant if such allocation would cause such Participant to become a
Disqualified Person or if such allocation to a Participant who already is a
Disqualified Person would cause the occurrence of a Nonallocation Year.
             
B.
The following rules apply for purposes of this Prohibited Allocation Of Stock
For S Corporations article:
               
1.
A “Nonallocation Year” means any Plan Year during which, at any time during such
Plan Year:
               
a.
The Plan holds Company Stock in an S Corporation; and
               
b.
Disqualified Persons own at least fifty percent (50%) of the number of shares of
stock in the S Corporation.
               
2.
The rules of Code section 318(a) apply for purposes of determining the fifty
percent (50%) ownership prohibition by Disqualified Persons causing a
Nonallocation Year to occur under this article, except that:
               
a.
The members of a Participant’s family will also include Family Members defined
below;
               
A Participant will not be considered as owning an option to acquire stock and
the rules of Code section 318(a)(4) do not apply; and
               
A Participant will be treated as owning Deemed-Owned Shares regardless of the
trust exception in Code section 318(a)(2)(B)(i).

 
 
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3.
Synthetic Equity shall be counted as outstanding stock of the Company in
accordance with the requirements of Code section 409(p)(5) and the Treasury
Regulations, if any, when determining if a Plan Year is a Nonallocation Year. If
a Nonallocation Year results without counting Synthetic Equity, then Synthetic
Equity will not be counted if it would result in a Plan Year not being a
Nonallocation Year.
               
4.
“Disqualified Person” means any Participant if:
               
a.
The aggregate of Deemed-Owned shares of such Participant and his Family Members
is at least twenty percent (20%) of the number of Deemed-Owned Shares of stock
in the S Corporation; or
               
b.
In the case of a Participant not described in the preceding paragraph, the
number of Deemed-Owned shares of such Participant is at least ten percent (10%)
of the number of Deemed-Owned Shares of stock in the S Corporation; or
               
c.
He is a Family Member of a Disqualified Person under paragraph a, has
Deemed-Owned Shares and is not otherwise treated as a Disqualified Person under
paragraph 4a, above.
               
5.
“Deemed-Owned Shares” means with respect to any Participant:
               
a.
The Company Stock in the S Corporation allocated to a Participant under the
Plan; and
               
b.
A Participant’s shares of the stock in the S Corporation that is held by the
Plan, but not allocated under the Plan to Participants. A Participant’s share of
unallocated S Corporation stock is the amount of unallocated stock that would be
allocated to such Participant if the unallocated stock were allocated to all
Participants in the same proportion as the most recent stock allocation under
the Plan; and
               
c.
Synthetic Equity, which shall be counted as Deemed-Owned Shares of the
Participant in accordance with the requirements of Code section 409(p)(5) and
the Treasury Regulations.
               
6.
“Family Member” means with respect to any Participant:
               
a.
The Participant’s spouse, except if they are legally separated under a decree of
divorce or separate maintenance;
               
b.
An ancestor or lineal descendant of the Participant or his spouse;

 
 
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c.
A brother or sister of the Participant or his spouse and any lineal descendant
of such brother or sister; or
               
d.
The spouse of any individual described in paragraphs b or c above.
               
7.
“Synthetic Equity” means any stock option, warrant, restricted stock, deferred
issuance stock right or similar interest or right that gives the holder the
right to acquire or receive stock of the S Corporation in the future. Except to
the extent provided in the Treasury Regulations, Synthetic Equity also includes
a stock appreciation right, phantom stock unit, or similar right to a future
cash payment based on the value of such stock or appreciation in such value. In
addition, under the temporary and proposed Treasury Regulations, nonqualified
deferred compensation and rights to acquire interest in certain related entities
are also considered synthetic equity.
           
ARTICLE VI. VESTING OF ACCOUNTS
           
6.01
Accelerated Vesting.
             
The value of a Participant’s Account shall become fully vested when the
Participant attains his Normal Retirement Age or upon his Termination of
Employment by reason of death or Disability.
           
6.02
Regular Vesting.
             
Except as otherwise provided in this article, for Plan Years ending on or before
December 31, 2006, a Participant’s Account shall become vested in accordance
with the following schedule:

Years of
   
Vested
Service
   
Percentage
Less than 3
   
0
%
3
   
30
%
4
   
40
%
5
   
60
%
6
   
80
%
7 or more
   
100
%

 
 
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Except as otherwise set forth in this article, for Plan Years beginning on or
after January 1, 2007, a Participant’s Account shall become vested in accordance
with the following schedule:

 
Years of
   
Vested
Service
   
Percentage
Less than 2
   
0
%
2
   
20
%
3
   
40
%
4
   
60
%
5
   
80
%
6 or more
   
100
%

6.03
Years Of Service.
             
A.
An Employee shall be credited with Years Of Service as follows:
               
1.
An Employee shall be credited with one (1) Year of Service for each Vesting
Computation Period in which an Employee performs one thousand (1,000) Hours of
Service.
               
2.
An Employee who is absent from work for maternity or paternity leave shall be
credited for purposes of this article with Service as described in the Service
article from the date she was first absent from work to the earlier of the
anniversary of that date or the date she again performs an Hour of Service for
the Company.
               
3.
If an Employee Terminates Employment prior to his earning any vested percentage,
once the Participant has incurred five (5) consecutive Breaks in Service, his
Service prior to such Separation From Service shall be disregarded for vesting
purposes in the event of a return to Service.
               
4.
In the case of an Employee who incurs a Break in Service followed by a return to
Service, Service prior to the Break in Service shall be excluded for purposes of
vesting in the Account established after he has returned to Service until he has
completed the requirements of the Entry and Participation article subsequent to
his return to Service.
               
5.
In the case of an Employee who has five (5) consecutive Breaks in Service
followed by a return to Service, all Years of Service after such break in
Service shall be disregarded for purposes of determining the vested percentage
of the Participant’s Company Account attributable to allocations made for Plan
Years prior to such break in Service.

 
 
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6.
For Employees who were employed by Yolo Community Bank on September 1, 2004,
Hours of Service shall include each Hour of Service that an Employee performed
for Yolo Community Bank before August 31, 2004, the date that Yolo Community
Bank became an Affiliated Employer. Notwithstanding the foregoing, as specified
in other sections of the Plan, Employees of Yolo Community Bank on September 1,
2004, received credit for Service with respect to employment with Yolo Community
Bank for periods of employment before Yolo Community Bank became an Affiliated
Employer, or on about August 31, 2004.
               
7.
For Employees who were employed by Yolo Community Bank on September 1, 2004,
Years of Service shall also include the number of calendar years beginning after
December 31, 2002 in which the Participant was credited with at least one
thousand (1,000) Hours of Service with Yolo Community Bank if such Participant
became an Employee of the Employer by reason of the merger of Yolo Community
Bank into a wholly-owned subsidiary of Bancorp on or about August 31, 2004
(Merger). For the 2004 calendar year, service with Yolo Community Bank, both
before and after the Merger, will be counted for purposes of determining Years
of Service.
               
8.
For Employees who were employed by Six Rivers National Bank on October 11, 2000,
Hours of Service and Years of Service while an employee of Six Rivers National
Bank shall be counted.
           
6.04
Forfeitures.
             
The forfeiture of that portion of a Participant’s Account in which the
Participant is not vested shall occur on the earlier of:
             
A.
The last day of the Plan Year next following, or coincident with, the
distribution of the entire Vested portion of the Participant’s Account; or
             
B.
The last day of the Plan Year in which the Participant incurs five (5)
consecutive one (1) year Breaks In Service.
             
If the Participant had no Vested Account at the time of the Participant’s
Termination Of Employment, the preceding sentence shall apply as if a
distribution of the Participant’s Account occurred on the date of the
Participant’s Termination Of Employment. If the Participant has been reemployed
prior to the time of forfeiture, no forfeiture shall occur.

 
 
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A.
If a distribution was made to the Participant of less than his entire vested
interest, his Account which contains any undistributed vested amount shall be
recredited as of his reemployment date if he repays the full amount of the prior
distribution before the date on which he would otherwise have incurred five (5)
consecutive Breaks in Service. If the Participant does not fully repay the prior
distribution within such period, only that portion of his Account determined as
follows (and including both his restored Participant suspense account and any
undistributed vested interest) shall be recredited on that date:
           
Recredited Amount = AB(UV/V)
               
For purposes of applying this formula, AB is the total Account balance at the
Participant’s date of Separation From Service, UV is the undistributed vested
interest and V is the amount of the vested Account balance at the Participant’s
date of Separation From Service.
             
B.
If the former Participant has not received a complete distribution of his vested
interest (by election, or otherwise), the unvested amount of his Account shall
be held in a Participant suspense account until he incurs five (5) consecutive
Breaks in Service. Such amounts shall then be forfeited and allocated as of the
next Valuation Date in the manner provided in the Allocation To Accounts
article.
             
C.
Participant suspense accounts shall share in the allocation of Trust income or
loss on every Valuation Date unless forfeited on or prior to such date.
             
D.
Forfeitures which are allocable as of a given Valuation Date shall be added to
the Company’s discretionary Contribution for such year and allocated as of such
date to the Accounts of then Eligible Participants as provided in Allocations To
Account article.
             
E.
If a portion of a Participant’s Account is forfeited, Qualifying Employer
Securities allocated under the Allocation Of Contributions And Forfeitures
article must be forfeited only after other assets. If interests in more than one
(1) class of Qualifying Employer Securities have been allocated to a
Participant’s Account, the Participant must be treated as forfeiting the same
proportion of each such class. If a distribution of Qualifying Employer
Securities is made from a Participant’s Account, the Participant will receive a
proportional distribution of each such class of Qualifying Employer Securities.
             
F.
If a former Participant who has suffered a forfeiture in accordance with the
preceding paragraph is reemployed as an Employee by the Company and repays to
the Plan all money distributed from his Account prior to the date he would
otherwise have incurred five (5) consecutive Breaks in Service, any amounts so
forfeited (unadjusted for any increase or decrease in the value of Trust assets
subsequent to the Valuation Date on which the forfeiture occurred) shall be
reinstated to the Participant’s Account within a reasonable time after such
repayment. Such reinstatement shall be made from Forfeitures of Participants
occurring during the Plan Year in which such reinstatement occurs to the extent
such Forfeitures are attributable to Contributions by the same Company and
earnings on such Contributions; provided, however, if such Forfeitures are not
sufficient to provide such reinstatement, the reinstatement shall be made from
the current year’s Contribution by the Company to the Plan. A former Participant
who was deemed cashed out due to having a zero (0) nonforfeitable portion of his
Account will be restored in his Account balance if reemployed prior to the date
he would have incurred five (5) consecutive Breaks in Service.

 
 
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6.05
Divestment.
             
Except as provided under the Forfeitures article, the Reduction For Other
Pension Plan Contributions article and the Alienation And QDROs article a
Participant’s vested rights shall not be subject to divestment for any reason.
           
6.06
Absence Of Participant.
             
If, according to the records of the Plan, all or a portion of a Participant’s
vested Account becomes payable under the Distributions article, and the
Participant or his Beneficiary has not made a claim for benefits, and the
Administrative Committee, after a reasonable search, cannot locate the
Participant or his Beneficiary, the vested Account shall be forfeited and
reallocated in accordance with the Allocation To Accounts article on the day the
Participant incurs a Break in Service, or such later date as the Administrative
Committee may determine. If the Participant or his Beneficiary subsequently
presents a valid claim for benefits to the Administrative Committee, the
Administrative Committee will reinstate the amount of the vested Account balance
that had been forfeited, unadjusted by any gains or losses attributable to such
amount.
           
6.07
No Reduction In Vesting.
             
An individual who was a Participant immediately preceding the effective date of
any subsequent amendment to this Plan and Trust Document or a Participant in a
predecessor plan by merger, shall have the choice of having his vested
percentage in such plan’s or former plan’s Account balance determined by the
terms of such plan immediately prior to such amendment or merger if such
provisions would provide a greater vested percentage at any relevant time in
such Account balance.

 
 
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6.08
Amendments To Vesting Schedule.
             
A.
Election Of Prior Vesting Schedule.
               
If the Plan’s vesting schedule is amended or if the Plan is amended in any way
that directly or indirectly affects the computation of a Participant’s
nonforfeitable percentage, or if the Plan is deemed amended by an automatic
change to or from a Top-Heavy Plan vesting schedule, each Participant with at
least three (3) Years Of Service with the Employer may elect within a reasonable
period (described in the Election Period paragraph, below) after the adoption of
the amendment or change, to have such Participant’s nonforfeitable percentage
computed under the Plan without regard to such amendment or change.
             
B.
Election Period.
               
The election period shall begin when the Plan amendment is adopted, and end on
the latest of the following dates:
               
1.
The date which is sixty (60) days after the date on which the Plan amendment is
adopted;
               
2.
The date which is sixty (60) days after the Plan amendment becomes effective; or
               
3.
The date which is sixty (60) days after the day on which the Participant is
issued written notice of the Plan amendment by the Employer or the Plan
Administrator.
             
C.
Service Requirements.
               
A Participant shall be considered to have completed three (3) Years Of Service
if the Participant has completed three (3) Years Of Service prior to the
expiration of the election period.
             
D.
Election Only By Participant.
               
The election is available only to an individual who is a Participant in the Plan
at the time the election is made.
             
E.
Irrevocable Election.
               
Such election shall be irrevocable.

 
 
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F.
No Effect On Vested Rights.
               
Such amendment shall not reduce the Vested percentage of a Participant’s Account
under the preamendment vesting schedule as of the later of the date on which
such amendment is adopted or the effective date of such amendment.
           
ARTICLE VII. TOP-HEAVY PLAN RULES
           
7.01
Special Definitions.
             
For purposes of this article, the following definitions shall apply:
             
A.
“Affiliated Employer” means with respect to an Employer:
               
1.
Any corporation which is a member of a controlled group of corporations (as
defined in Code section 414(b)) which includes the Employer;
               
2.
Any trade or business (whether or not incorporated) which is under common
control (as defined in Code section 414(c)) with the Employer;
               
3.
Any organization (whether or not incorporated) which is a member of an
affiliated service group (as defined in Code section 414(m)) which includes the
Employer; and
               
4.
Any other entity required to be aggregated with the Employer pursuant to the
Treasury regulations under Code section 414(o).
             
B.
“Required Aggregation Group” means each qualified plan of the Employer in which
at least one (1) Key Employee is a participant, in the Plan Year containing the
Determination Date or any of the four (4) preceding Plan Years, and each other
plan of the Employer which enables any plan of the Employer in which a Key
Employee is a participant to meet the requirements of either Code section
401(a)(4) or Code section 410. A terminated qualified plan shall be aggregated
with other plans of the Employer if the terminated plan was maintained within
the last five (5) years ending on the Determination Date and would, but for the
fact that it terminated, be part of a Required Aggregation Group.
             
C.
“Permissive Aggregation Group” means the Required Aggregation Group and any plan
of the Employer which is not in the Required Aggregation Group but which the
Employer elects as included in the Required Aggregation Group; provided,
however, that the resulting group, taken as a whole, would continue to meet the
requirements of both Code section 401(a)(4) and Code section 410.

 
 
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D.
“Determination Date” with respect to any Plan Year means the last day of the
preceding Plan Year; provided that in the case of the first Plan Year of the
Plan, the term shall mean the last day of the first Plan Year. If the Company
maintains two (2) or more qualified plans which have different Plan Years and
which must be either aggregated or are allowed to be aggregated when determining
top-heaviness pursuant to this Plan, the Determination Date to be used for this
Plan for aggregation purposes shall be the Determination Dates of all such other
plans required or permitted to be aggregated.
             
E.
Top-Heavy Plan.
               
“Top-Heavy Plan” means the Plan for a Plan Year if, as of the Determination
Date, the aggregate of the Accounts of Key Employees exceeds sixty percent (60%)
of the aggregate of the Accounts of all Employees under this Plan and any Plan
of an Aggregation Group.
           
7.02
Top-Heavy Status.
             
A determination shall be made each Plan Year as to whether the Plan is a
Top-Heavy Plan for such Plan Year as follows:
             
A.
The Plan shall be a Top-Heavy Plan for any Plan Year if, as of the Determination
Date, the aggregate of the accounts of the Key Employees under this Plan and any
plan of an Aggregation Group, exceeds sixty percent (60%) of the aggregate of
the accounts of all Employees under this Plan and any Plan of an Aggregation
Group.
             
B.
In the case of a Required Aggregation Group, each plan in the group will be
considered a Top-Heavy Plan if the Required Aggregation Group is a Top Heavy
group; no plan in the group will be considered a Top-Heavy Plan if the Required
Aggregation Group is not a Top Heavy group.
             
C.
In the case of a Permissive Aggregation Group, only a plan that is part of the
Required Aggregation Group will be considered a Top-Heavy Plan if the Permissive
Aggregation Group is a Top Heavy group; no plan in the Permissive Aggregation
Group will be considered Top-Heavy if the Permissive Aggregation Group is not a
Top Heavy group.
             
If the Plan is adopted by more than one Employer and the adopting Employers are
not all Affiliated Employers, then in accordance with Treasury regulations
section 1.416-1, Question and Answer G-2, the top-heavy plan requirements of
Code section 416 and this Top-Heavy Plan Rules article shall be applied with
respect to each individual Employer (or a group of Employers that are treated as
a single Employer pursuant to Code sections 414(b), 414(c), 414(m), or 414(o)).

 
 
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7.03
Benefits Taken Into Account.
             
For purposes of determining Accounts under this article, the present value of
the accrued benefits and the amounts of Account balances of an Employee as of
the Determination Date shall be increased by the distributions made with respect
to the Employee under the Plan and any plan aggregated with this Plan under Code
section 416(g)(2) during the one (1) year period ending on the Determination
Date. The preceding sentence shall also apply to distributions under a
terminated plan which, had it not been terminated, would have been aggregated
with the Plan under Code section 416(g)(2). In the case of a distribution made
for a reason other than Termination of Employment, death or Disability, this
provision shall be applied by substituting five (5) year period for one (1) year
period. The accrued benefits and Accounts of any individual who has not
performed services for the Employer during the one (1) year period ending on the
Determination Date shall not be taken into account.
           
7.04
Top-Heavy Plan Contribution Limitation.
             
For any Plan Year during which the Plan is a Top-Heavy Plan, a contribution, as
determined under this article, shall be made on behalf of each Eligible
Participant who is not a Key Employee who is employed on the last day of the
Plan Year, regardless of whether such Employee has less than one thousand
(1,000) Hours of Service, and shall not be less than the lesser of:
             
A.
Three percent (3%) of the total compensation paid or accrued to such Employee as
stated on such Employee’s W-2 for the Plan Year; or
             
B.
The highest percentage of total compensation (as defined in the Allocation Of
Contributions And Forfeitures article, as limited by Code section 401(a)(17), or
such other amount as may be established by the Treasury Regulations under Code
section 415(d)) allocated during the Plan Year on behalf of any Key Employee in
the aggregate:
               
1.
To his Company Stock Account and General Account under this Plan; and
               
2.
To his Company account under all other defined contribution plans to the extent
required by applicable law and regulations; maintained by the Company in which a
Key Employee is a participant.

 
 
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C.
The minimum benefit requirement of an Employer contribution consisting of three
percent (3%) of compensation shall be met by Contributions to this Plan.
             
For purposes of this article, all defined contribution plans required to be
included in an Aggregation Group shall be treated as one (1) plan.
             
The rules of this article shall not apply to any plan required to be included in
an Aggregation Group if the plan enables a defined benefit plan to meet the
requirements of Code sections 401(a)(4) or 410.
             
Employer matching contributions shall be taken into account for purposes of
satisfying the minimum contribution requirements of Code section 416(c)(2) and
the Plan. The preceding sentence shall apply with respect to matching
contributions under the Plan or, if the plan provides that the minimum
contribution requirement shall be met in another plan, such other plan. Employer
matching contributions that are used to satisfy the minimum contribution
requirements shall be treated as matching contributions for purposes of the
actual contribution percentage test and other requirements of Code section
401(m).
           
7.05
Top-Heavy Vesting.
             
A.
For any Plan Year in which the Plan is a Top-Heavy Plan, a Participant’s entire
Account attributable to Company Contributions shall be vested in accordance with
the following vesting schedule if such schedule results in greater vested
percentage at any relevant time:

 
Years of
   
Vested
Service
   
Percentage
Less than 2
   
0
%
2
   
20
%
3
   
40
%
4
   
60
%
5
   
80
%
6 or more
   
100
%

 
B.
In the event the Plan ceases to be a Top-Heavy Plan in any subsequent Plan Year:
               
1.
For any Participant with three (3) Years of Service as of the last day of the
first Plan Year in which the Plan is no longer a Top-Heavy Plan, the vesting
schedule in the Top-Heavy Vesting article shall apply to such Participant’s
entire Company Account for such Plan Year and for each subsequent Plan Year if
such schedule results in a greater vested percentage at any relevant time than
the percentage otherwise applicable under the Regular Vesting article; and

 
 
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2.
For all Participants, the vesting schedule in the Regular Vesting article shall
apply to the portion of such Participant’s Company Account which is attributable
to amounts allocated as of such nonTop-heavy Plan Year and for each subsequent
Plan Year until the Plan again becomes a Top-Heavy Plan; provided, however, that
in no event shall such a Participant’s vested percentage for the portion of the
Company Account attributable to amounts contributed during or prior to a
top-heavy Plan Year be less than the applicable percentage for the last Plan
Year that the Plan was a Top-Heavy Plan.
             
C.
The Administrative Committee shall maintain records sufficient to account for
those portions of a Participant’s Account which are attributable to allocations
made for Plan Years during which the Plan is a Top-Heavy Plan and during which
the Participant is a Key Employee or during which the Participant is a Five
Percent (5%) Owner of the Company and for the vested percentages applicable to
any portion of Participant’s Account.
           
ARTICLE VIII. ALLOCATION OF TRUST INCOME OR LOSS
           
8.01
Allocation At Valuation Date.
             
As of each Valuation Date and prior to any allocation of Contributions and
Forfeitures to be made as of such date, the net income or loss of the General
Trust Fund and the Company Stock Fund since the preceding Valuation Date,
including net Company Stock appreciation or depreciation, shall be allocated to
each Participant’s or Inactive Participant’s Account and to each Participant
suspense account held pursuant to the Vesting Of Accounts article in the ratio
that the value, as of the preceding Valuation Date, of each such Account held in
the General Trust Fund or the Company Stock Fund, respectively, bears to the
value, as of the preceding Valuation Date, of all such Accounts invested in the
General Trust Fund or the Company Stock Fund respectively. The Administrative
Committee shall determine the net income or loss based on a statement from the
Trustee(s) of the receipts and disbursements of the fund since the preceding
Valuation Date and of the fair market value of the fund as of the Valuation
Date. The Administrative Committee shall adopt equitable procedures to establish
a proportionate crediting of Trust income or loss to those portions of
Participants’ Accounts which have been contributed by or paid to Participants in
the interim period since the preceding Valuation Date.

 
 
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Dividends on Company Stock held in a Participant’s Account shall be allocated to
that Participant’s General Account or Company Stock Account in cash or in shares
of Company Stock. Cash dividends on unallocated shares of Company Stock used to
make payments on an exempt loan shall be allocated in accordance with the
provisions of the Allocation To Accounts article and by relative prior Account
balances. Cash dividends attributable to unallocated shares of Company Stock
(not used to make payments on an exempt loan), including Stock acquired with an
exempt loan and held in a Suspense Account, shall be allocated among all General
Accounts in the General Trust Fund. A minimum of Company Stock with a fair
market value equal to the amount of cash dividends paid on allocated shares of
Company Stock used to make payments on an exempt loan shall be allocated to
Participant’s Accounts. Any dividends may, in the sole discretion of the
Administrative Committee, be distributed to the Participants or used to repay
any exempt loan properly obtained to acquire Company Stock.
             
For any year for which the Company has elected to be treated as an S Corporation
for federal income tax purposes under the Code, S Corporation distributions on
Company Stock held in a Participant’s Account shall be allocated to that
Participant’s General Account or Company Stock Account in cash or in shares of
stock in relation to proportion to the shares in the Participant’s Company Stock
Account on which such distributions were paid. Cash distributions on unallocated
shares of Company Stock used to make payments on an exempt loan shall be
allocated in accordance with the Allocation To Accounts article by relative
prior Company Stock Account balances and then applied to make payments on the
exempt loan. Shares released from suspense due to the payment of such cash
against the exempt loan shall be allocated to the Company Stock Accounts in
proportion the prior balances in the Company Stock Accounts. Cash distributions
attributable to unallocated shares of Company Stock not used to make payments on
an exempt loan, including Company Stock acquired with an exempt loan and held in
a Suspense Account, shall be allocated among all General Accounts in the General
Trust Fund. Any distributions may, in the sole discretion of the Trustee(s), be
retained and invested in the Trust Fund (in Company Stock or other investments),
or used to acquire additional shares of Company Stock, from the Company or from
any other person, including a party in interest, to the extent in accordance
with the terms of this Plan and ERISA, generally, or used to repay any exempt
loan properly obtained to acquire Company Stock, in accordance with the Treasury
Regulations under Code section 4975.
           
8.02
Limitation And Suspense Accounts.
             
Amounts held in Limitation Accounts established pursuant to the Allocation Of
Contributions And Forfeitures article shall not share in General Trust Fund
income or loss. Amounts held in Participant suspense accounts pursuant to the
Vesting Of Accounts article shall share in General Trust Fund income or loss on
every Valuation Date unless forfeited on or prior to such date.

 
 
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8.03
Separate Valuation.
             
The portion of any Participant’s Account invested on a segregated basis as
provided in this Plan shall be valued separately on each Valuation Date and the
net income or loss allocated to such Account shall be based on the property,
including income, gain, loss and/or other change in value of the property
constituting such portion of the Account.
           
8.04
Valuation Of Trust Fund.
             
The Trust Fund, including all segregated investments, shall be valued as of the
last day of each Plan Year and on any other special supplemental date or dates
determined by the Trustee(s) to be prudent and necessary for the Trustee(s) to
value the Trust Fund. The Trustee(s) shall determine the fair market value of
the Trust Fund, including both the General Trust Fund and the Company Stock
Fund. If requested by the Trustee(s) under the provisions of Accounting article,
the Administrative Committee may consult with the Trustee(s) in determining the
fair market value of the Trust Fund, including that portion invested in Company
Stock, on the basis of the Fund’s fair market value. If the Company Stock is not
readily tradable on an established market or is restricted in its trading, fair
market value shall be determined by a qualified independent appraiser meeting
requirements similar to those contained in Treasury Regulations under Code
section 170(a)(1). The Trustee(s) may rely on such valuation of the Company
Stock as may be determined by a qualified, independent appraiser.
           
8.05
Rebalancing Of Investments Of Cash And Company Stock To Prohibit A Nonallocation
Year.
             
As of each Valuation Date or as of such other dates as determined by the
Committee and prior to any allocation of Company Stock to be made as of such
date, the Committee shall determine whether an allocation of Company Stock may
cause a Nonallocation Year to occur or cause any Participant to become a
Disqualified Person in the current or following Plan Year, as set forth in
Article 5.
             
A.
If in any Plan Year and prior to any Valuation Date on which a projected
allocation of Company Stock to any Participant’s account may cause a
Nonallocation Year to occur, or cause any Participant to become a Disqualified
Person, the Committee may rebalance the ratio of Company Stock and cash in each
Participant’s account so that no Participant’s Stock Account contains more than
the lesser of nine and nine-tenths percent (9.9%) of the Company Stock held in
the ESOP, or such other amount as is necessary to prevent any Participant
(including Family Members of a Participant) from becoming a Disqualified Person
or to prevent such Plan Year from becoming a Nonallocation Year. The amount of
Company Stock that will be debited from Participants’ accounts will be
determined by the Committee as an exercise of a fiduciary duty to protect the
Plan’s status as an ESOP.

 
 
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B.
If in any Plan Year and prior to any Valuation Date on which a projected
allocation of Company Stock to any Participant’s account may cause a
Nonallocation Year to occur, or cause any Participant to become a Disqualified
Person, the Committee may exchange Company Stock from the account of such
Participant for cash from other Participants’ accounts so that the Participant
is no longer a Disqualified Person, or is prevented from becoming a Disqualified
Person or so that a Nonallocation Year does not occur. The amount of Company
Stock that will be debited from such Participants’ accounts will be determined
by the Committee as an exercise of a fiduciary duty to protect the Plan’s status
as an ESOP.
           
ARTICLE IX. PARTICIPANTS’ ACCOUNTS
           
9.01
Accounts.
             
The Administrative Committee shall maintain separate Accounts for each
Participant. Each Participant’s Account shall reflect the amounts allocated
thereto and distributed therefrom and such other information that affects the
value of such Account pursuant to this Plan.
           
9.02
Value Of Accounts.
             
The value of a Participant’s Account on any date shall be its value as
determined on the coincident or next preceding Valuation Date, plus any
Contributions or other amounts subsequently credited thereto, and less any
distributions subsequently made therefrom; provided that with respect to any
Account or portion thereof invested on a segregated basis, the value shall be
the current fair market value, including any income or loss, of the property
constituting such segregated Account. The Administrative Committee may maintain
records of Accounts to the nearest whole dollar and to the nearest one-hundredth
(1/100th) of a share of Company Stock.
           
9.03
Statement Of Account.
             
As soon as practicable after the end of each Plan Year, the Administrative
Committee shall furnish a statement of Account to each Participant. Values shall
be reported as determined as of the last day of the Plan Year. Upon the
discovery of any error or miscalculation in an Account, the Administrative
Committee shall correct the error or miscalculation, to the extent
administratively feasible, and as soon as administratively feasible. Statements
to Participants are for reporting purposes only. No statement of allocation,
valuation or balances shall vest any right or title in any part of the Trust
Fund nor require any segregation of Trust assets, except as specifically
provided in this Plan document.

 
 
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ARTICLE X. DISTRIBUTIONS
           
10.01
Benefits From Trust.
             
Benefits under the Plan shall be distributed solely from the Trust. The Company
shall have no liability or responsibility for benefit distributions.
Distribution of benefits shall be limited to those portions of a Participant’s
vested Account as provided in the Vesting Of Accounts or Amendment, Termination
And Merger articles. Distributions shall only be made on or after a
Participant’s Termination of Employment if and as required upon attaining age
seventy and one-half (70-1/2) under Code section 401(a)(9) and Treasury
regulations thereunder, or the termination of the Plan.
           
10.02
Form Of Distribution.
             
A.
For any years during which the Company does not elect to be treated as an S
Corporation for federal income tax purposes under the Code, distributions of a
Participant’s Company Stock Account shall be made entirely in whole shares of
Company Stock, with the value of any fractional share being paid in cash. If the
Participant elects to receive a distribution of the Participant’s General
Account in Company Stock, it shall be used to acquire whole shares of Company
Stock for the Participants’ Company Stock Account, to the extent such shares are
available within the Trust, with the value of any fractional share being paid in
cash. However, if the charter of the Company restricts the ownership of all
outstanding Company Stock to Employees or to a trust under Code section 401(a),
the Administrative Committee may determine that distributions to a Participant
in a Plan Year shall be made entirely in cash, or in stock with immediate
repurchase by the Employer or the ESOP pursuant to the Put Option article. This
article is subject to the Diversification article of the Plan.
             
B.
For any year for which the Company has elected to be treated as an S Corporation
for federal income tax purposes under the Code, distribution of a Participant’s
Account, including his Company Stock Account, shall be made entirely in cash.
Any balance in the Participant’s Account held in shares of Company Stock for
distribution shall first be liquidated, at fair market value within the Trust,
with the value of the account distributed in cash, by redemption by the Company
from the Trust, or by distribution in kind with immediate and simultaneous
repurchase by the Company from the Distributee or his or her Individual
Retirement Account.

 
 
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C.
Distributions shall be made by the Trustee(s) according to the directions of the
Administrative Committee. The Administrative Committee shall have the authority
to direct the distributions according to the terms and conditions of the Plan. A
Participant or Beneficiary shall have the right to file a claim for benefits
under the Claims article. Distributions shall be made in cash, kind or in a
combination of both as provided elsewhere in this Form Of Distribution article.
             
D.
The Company retains the power and discretion, pursuant to Code section
411(d)(6)(C), to amend the distribution forms and options in a nondiscriminatory
fashion.
           
10.03
Undistributed Amounts Upon Death.
             
The vested portion of any Participant’s Account which remains undistributed at
his death shall be distributed to the Participant’s Beneficiary in accordance
with the directions of the Administrative Committee as provided in this article
unless the Participant has designated, and the Administrative Committee
approved, an alternative method of distribution.
             
Notwithstanding any other provision of the Plan to the contrary, in the case of
a Participant who dies on or after January 1, 2007 while performing qualified
military service (as defined in Code §414(u)), the survivors of the Participant
are entitled to any additional benefits (other than benefit accruals relating to
the period of qualified military service) provided under the Plan as if the
Participant had resumed and then terminated employment on account of death.]
           
10.04
Deferred Cash Distributions.
             
Where the distribution of all or any portion of a Participant’s Account is to be
deferred and distributed in the form of cash, the vested portion shall continue
to be held and invested as an Account of the Trust subject to revaluation as
provided in the Allocations Of Trust Income Or Loss article; provided, however,
that at the discretion of the Administrative Committee or the written request of
a Participant or his Beneficiary, it shall be transferred to an insured savings
account, to a certificate of deposit or to other similar investments. Interest
shall be determined according to the rules governing savings accounts,
certificates of deposit and similar instruments and shall be credited to such
Participant’s Account. Savings accounts, certificates of deposit and other
similar instruments shall be part of this Trust and shall be subject to all the
provisions hereof.
           
10.05
Deferred Non-Cash Distribution.
             
Where the distribution of all or any portion of a Participant’s vested interest
is deferred and is to be distributed in a form other than cash, such vested
interest shall continue to be held as an Account of the Trust subject to
revaluation as provided in the Allocations Of Trust Income Or Loss article. Such
property shall thereafter be held for distribution in the manner designated by
the Administrative Committee. Such Accounts shall continue as part of the Trust
and be subject to all the provisions hereof, and such Accounts shall share in
the allocation of Trust income or loss as provided in the Allocations Of Trust
Income Or Loss article.

 
 
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10.06
Distribution To Minor Or Incompetent Person.
             
In case of any distribution to a minor or to a legally incompetent person, the
Administrative Committee may direct the Trustee(s) that the same be made for the
benefit of such person directly to such person, his legal representative or a
near relative of such person or that the Trustee(s) shall use the same directly
for the support, maintenance, or education of such person. The Trustee(s) shall
not be required to monitor or direct the application by any third (3rd) party of
any distributions made pursuant to this article.
           
10.07
Right Of First Refusal.
             
All shares of Company Stock distributed by the Trustee(s), except those that are
publicly traded, shall be subject to a “Right of First Refusal.” Such Right of
First Refusal shall provide that, prior to any subsequent transfer, the shares
must first be offered by written offer to the Company and Trust in any order of
priority. In the event that the proposed transfer constitutes a gift or other
transfer at less than fair market value, the Administrative Committee shall so
advise the Trustee(s) and the price per share shall be determined by the
Trustee(s) as of the most recent Valuation Date; or in the case of a transaction
between the Plan and a disqualified person as defined in Code section
4975(e)(2), as of the date of the transaction. In the event of a proposed
purchase by a prospective, bona fide purchaser, the offer to the Trust shall be
at the greater of fair market value, as determined above by the Administrative
Committee, or at the price offered by the prospective, bona fide purchaser. The
Trust may accept the offer at any time during a period not exceeding fourteen
(14) days after the security holder gives written notice to the Trustee(s) that
an offer by a third (3rd) party to purchase the Company Stock has been received
or that a transfer of any kind will occur.

 
 
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10.08
Put Option.
             
A.
For any years during which the Company has not elected to be treated as an S
Corporation for federal income tax purposes under the Code, a Participant, or
Beneficiary who receives Company Stock shall be granted (at the time that such
shares of Company Stock so acquired are distributed to him) an option to sell,
or “put” the shares, or any part of them, to the Company, unless prohibited by
state or federal law. However, the Trust shall have the option, but in no event
the responsibility, to assume the rights and obligations of the Company at the
time the Put Option is exercised. In the event that state or federal law
precludes the Company from honoring the put, then the Board, collectively, or
the Board, individually, shall have the option to honor the put unless the Trust
exercises its option to do so. The Put Option shall provide that, for a period
of sixty (60) days after such shares of Company Stock are distributed to a
Participant or Beneficiary, and, if the Put Option is not exercised within the
sixty (60) day period, for an additional period of sixty (60) days in the next
following Plan Year (beginning no earlier than six (6) months from the first
date of the original Put Option period), the security holder shall have the
right to have the Company and/or the Trust (as the put may specify) purchase the
shares at their fair market value. For purposes of this article, fair market
value shall be based on the fair market value of Company Stock as determined as
of the Valuation Date coinciding with or immediately preceding the date of
exercise or, in the case of a transaction between the Plan and a disqualified
person as defined in Code section 4975(e)(2), as of the date of the transaction.
The terms of the payment for the purchase of such shares of Company Stock shall
be set forth in the put, and may be either in a lump sum payment or in up to
five (5) substantially equal annual installments if the shares were distributed
in a lump sum (with adequate security and interest at a rate reasonable on the
unpaid principal balance), as determined by the Company, or the Trustee(s) if
the Company assigns the Put Option to the Trust. Payments under this Put Option
article whether in a lump sum or in substantially equal annual payments shall
begin not later than thirty (30) days after the exercise of the Put Option. The
Put Option provided for in this article shall not be required with respect to
shares of Company Stock which are readily tradable on an established market, nor
shall such a Put Option be required if the Company is a bank (as defined in Code
section 581) which is prohibited by law from redeeming or purchasing its own
securities.
             
B.
Except as otherwise provided in this article, a Participant may not be required
to sell Company Stock to the Company or the Trust, nor may the Trustee(s) enter
into an agreement which obligates the Trust to purchase Company Stock. Shares of
Company Stock which are held or distributed by the Trustee(s) may be subject to
restrictions on transferability as may be necessary to comply with applicable
federal and state securities or banking laws. Other than such restrictions, and
as provided in the Right Of First Refusal and Put Option articles, no shares of
Company Stock held or distributed by the Trustee(s) may be subject to a put,
call or other option or buy/sell or similar arrangement. The provisions of this
article shall continue to apply to Company Stock even though:
               
1.
Qualifying Employer securities acquired with the proceeds of an exempt loan are
fully paid for; or
               
2.
The Plan ceases to be an employee stock ownership plan as defined in Code
section 4975(e)(7).

 
 
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10.09
Timing Of Distributions.
             
A.
The distribution of a Participant’s entire vested Account that does not exceed
one thousand dollars ($1,000) shall be made in a lump sum as soon as
administratively feasible after the end of the Plan Year in which the
Participant has a Termination of Employment. Neither the Company, the
Administrative Committee nor the Trustee(s) shall be liable for penalties
accruing to a Participant under applicable law or regulation as a result of a
distribution to such Participant before the Participant attains age fifty-nine
and one-half (59-1/2).
             
B.
Distributions due to Termination of Employment due to death, Disability, or
after attaining Normal Retirement Age will commence not later than one (1) year
after the end of the Plan Year in which the Participant Terminates Employment.
             
C.
Distributions due to Termination of Employment prior to the Participant’s Normal
Retirement Age, and other than due to Disability or death, for Account balances
that exceed one thousand dollars ($1,000), will commence as soon as
administratively feasible after the end of the Plan Year in which the
Participant Terminates Employment. Distributions scheduled to be paid under this
article shall not commence if the Participant is reemployed by the Employer
before distribution is otherwise required to be paid pursuant to this article.
             
D.
For distributions other than attaining the Plan’s Normal Retirement Age,
Disability or death, for any Plan Years during which the Company has not elected
to be treated as an S Corporation for federal income tax purposes under the
Code, the distributable Account balance of a Participant shall not include any
Company Stock acquired following the Plan Year with the proceeds of an exempt
loan until after the end of the Plan Year in which such loan is repaid in full.
             
E.
Upon Termination Of Employment after attaining Normal Retirement Age, a
Participant may elect to defer the commencement of a distribution by providing
the Committee with a written, signed notice. However, in no event shall such
distribution begin later than the sixtieth (60th) day after the last day of the
Plan Year in which occurs the Participant’s Normal Retirement Age provided,
however, that:
               
1.
No distribution method chosen by the Participant shall provide any payment in an
amount less than that required under this article; and

 
 
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2.
Distributions shall commence no later than:
               
a.
April 1 of the calendar following the calendar year in which the Participant
attains age seventy and one-half (70-1/2); or
               
b.
In the case of a Participant other than a Participant who is a Five Percent (5%)
Owner with respect to the Plan Year ending in the calendar year in which the
Participant attains age seventy and one-half (70-1/2), April 1 of the calendar
year following the calendar year in which the Participant retires.
             
F.
For distributions on account of a Participant’s death:
               
1.
If distribution of the Participant’s vested Account has commenced under the
provisions of this article to the Participant, and the Participant dies before
receiving his entire vested Account; then the balance of the Participant’s
undistributed Account shall continue to be distributed at least as rapidly as
the method used at the Participant’s date of death; and
               
2.
If a Participant dies before distribution of his vested Account has commenced
under the provisions of this article, then the undistributed vested Account
shall begin to be distributed no later than one (1) year after the last day of
the Plan Year in which the date of death occurs, and shall be completely
distributed within five (5) years after the Participant’s death; and, provided
further, that:
               
a.
If the Beneficiary is the deceased Participant’s surviving spouse, such
distributions shall commence no later than the date on which the Participant
would have attained age seventy and one-half (70-1/2); and
               
b.
If such surviving spouse dies before distributions to such surviving spouse
begin, the provisions of this article shall be applied as if the Participant’s
spouse were the Participant.
               
3.
Any amount distributed to a child of a deceased Participant shall be treated as
though paid to such Participant’s surviving spouse if such amount will become
payable to the surviving spouse when the child reaches majority (or such other
event as may be designated under applicable regulations).
             
G.
If any part of the Participant’s vested Account balance is to be distributed to
the Participant before the Participant attains age sixty-five (65), and such
Participant’s vested Account exceeds one thousand dollars ($1,000) (or such
other amount as may be established by applicable law or regulations), written
consent of the Participant must be obtained by the Administrative Committee for
all distributions.

 
 
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H.
If the amount of any distribution under this article cannot be determined by the
date required for payment under this Distributions article, payment of benefits,
retroactive to such date, shall begin no later than sixty (60) days after the
earliest date on which the amount of the distribution can be determined.
           
10.10
Distributions – General Provisions.
             
A.
If the form of distribution to a Participant includes periodic payments, such
payments shall meet the following requirements:
               
1.
The present value of the periodic payments to be made to a Participant within
the Participant’s life expectancy shall be greater than fifty percent (50%) of
the present value of the total of such payments to be made to the Participant
and his Beneficiaries, determined as of the date such payments are to commence.
               
2.
The amount of the periodic payments shall be calculated to extend not beyond the
life expectancy of the Participant or life expectancies of the Participant and
his Beneficiary. For purposes of this computation, life expectancies may be
redetermined, but not more frequently than annually, to the extent permitted by
applicable law and regulation.
             
B.
The vested portion of any Participant’s Account which remains undistributed at
his death shall be distributed to the Participant’s Beneficiary in accordance
with the directions of the Administrative Committee as provided in this article.
             
C.
With respect to distributions under the Plan made for calendar years beginning
on or after January 1, 2003, the Plan will apply the minimum distribution
requirements of Code section 401(a)(9) in accordance with the final Treasury
Regulations sections 1.401(a)(9)-1 through 1.401(a)(9)-9 that were published on
April 16, 2002.
             
D.
By accepting payment of proceeds under this Plan, the Participant or the
Participant’s Beneficiary receiving the payment agrees that, in the event of
overpayment, the Participant or the Participant’s Beneficiary will promptly
repay the amount of overpayment without interest; provided, that, if the
Participant or the Participant’s Beneficiary has not repaid the overpayment
within thirty (30) days after notice, the Participant or the Participant’s
Beneficiary will also pay an amount equal to simple interest at the rate of ten
percent (10%) per annum (or the highest rate allowable, if less) on the unpaid
amount from the date of overpayment to the date of repayment, and in addition
will pay all legal fees, court costs and the reasonable time value of the
Trustee(s), Administrator or Employer, or any of their employees or agents,
related to the collection of such overpayment.

 
 
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10.11
Eligible Rollover Distributions.
             
A.
Direct Rollovers.
               
A Distributee may elect, at any time and in the manner prescribed by the Plan
Administrator, to have any portion of an Eligible Rollover Distribution paid
directly to an Eligible Retirement Plan specified by the Distributee in a Direct
Rollover.
             
B.
Definitions.
               
1.
“Eligible Rollover Distribution” means any distribution of all or any portion of
the balance to the credit of the Distributee; provided, however, that an
Eligible Rollover Distribution does not include:
                 
a.
Any distribution that is one (1) of a series of substantially equal periodic
payments (not less frequently than annually) made for the life (or life
expectancy) of the Distributee or the joint lives (or joint life expectancies)
of the Distributee and the Distributee’s designated Beneficiary, or for a
specified period of ten (10) years or more.
                 
b.
Any distribution to the extent such distribution is required under Code section
401(a)(9).
                 
c.
The portion of any distribution that is not includible in gross income
(determined without regard to the exclusion for net unrealized appreciation with
respect to Company Stock); provided, however, that:
                   
(1)
A portion of a distribution shall not fail to be an Eligible Rollover
Distribution merely because the portion consists of after-tax Employee
contributions that are not includible in gross income; and
                   
(2)
Notwithstanding the preceding clause, such portion may be transferred in a
direct trustee-to-trustee transfer only to:

 
 
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(a)
An individual retirement account described in Code section 408(a);
                       
(b)
A Roth individual retirement account described in Code section 408A;
                       
(c)
An individual retirement annuity described in Code section 408(b);
                       
(d)
A qualified plan described in Code section 401(a) (whether or not it is a
defined contribution plan) or an annuity contract or custodial account described
in Code section 403(b) that agrees to separately account for amounts so
transferred (and earnings thereon), including separately accounting for the
portion of such distribution that is includible in gross income and the portion
of such distribution that is not so includible; or
                       
(e)
Any distribution that is made upon hardship of the Employee.

 

   
2.
“Eligible Retirement Plan” means a qualified trust described in Code section
401(a), an annuity plan described in Code section 403(a), an annuity contract
described in Code section 403(b), an individual retirement account described in
Code section 408(a), a Roth individual retirement account described in Code
section 408A, an individual retirement annuity described in Code section 408(b)
other than an endowment contract, or an eligible deferred compensation plan
described in Code section 457(b) that is maintained by a state, political
subdivision of a state, or any agency or instrumentality of a state or political
subdivision of a state and that agrees to separately account for amounts
transferred into such plan from this Plan, that accepts the Distributee’s
Eligible Rollover Distribution; provided, however, that in the case of an
Eligible Rollover Distribution to a designated Beneficiary who is not the
Employee’s surviving spouse, (i) an Eligible Retirement Plan shall be either an
individual retirement account described in Code section 408(a), a Roth
individual retirement account described in Code section 408A, or an individual
retirement annuity described in Code section 408(b) other than an endowment
contract and (ii) a direct trustee-to-trustee transfer is made to such an
account or annuity.

 
 
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3.
“Distributee” means an Employee or former Employee who receives a distribution
from the Plan. “Distributee” also means the Employee’s or former Employee’s
surviving spouse and the Employee’s or former Employee’s spouse or former spouse
who is the alternate payee under a qualified domestic relations order, as
defined in Code section 414(p), with regard to the interest of the spouse or
former spouse. Effective for distributions after December 31, 2006,
“Distributee” also means the Employee’s designated Beneficiary who is not the
Employee’s spouse.
               
4.
A “Direct Rollover” is a payment by the Plan to the Eligible Retirement Plan
specified by the Distributee.
           
10.12
Other Rights And Options.
             
A.
The Company or Trustee(s) may offer to purchase any shares of Company Stock from
a Participant (or Beneficiary) at the time of the distribution or at any time in
the future.
             
B.
If the Beneficiary is to be paid a lump sum distribution qualified under Code
section 402(e), the Plan Administrator shall cause the Trustee(s) to collect the
proceeds of any contracts and pay them to the Beneficiary, together with a total
distribution of all of the Participant’s vested Account in a single tax year of
the Beneficiary.
             
C.
For purposes of this article, any amount paid to a child shall be treated as if
it had been paid to the surviving spouse if such amount will become payable to
the surviving spouse upon such child reaching majority or such other designated
event all as prescribed by the Secretary of the Treasury.
           
ARTICLE XI. SERVICE
           
11.01
Service.
             
“Service” means an Employee’s total period of employment with the Company,
taking into account the definitions of the Vesting Computation Period and the
Eligibility Computation Period.
           
11.02
Hours Of Service.
             
“Hours of Service” means:
             
A.
Each hour for which an Employee is paid, or entitled to payment, for the
performance of duties for the Company.

 
 
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B.
For Employees who were employed by Yolo Community Bank on September 1, 2004,
Hours of Service shall include each Hour of Service that an Employee performed
for Yolo Community Bank before August 31, 2004, the date that Yolo Community
Bank became an Affiliated Employer.
             
C.
Each hour for which an Employee is paid, or entitled to payment, by the Company
on account of a period of time during which no duties are performed (regardless
of whether the employment relationship has terminated) due to vacation, holiday,
illness, incapacity (including Disability), layoff, jury duty, military duty or
leave of absence; provided that no Hours of Service shall be credited to an
Employee:
               
1.
For a period during which no duties are performed if payment is made or due
under a plan maintained solely for purposes of complying with applicable
worker’s compensation, unemployment compensation, or disability insurance laws;
               
2.
On account of any payment made or due to an Employee solely as reimbursement for
medical or medically related expenses incurred by the Employee.
             
D.
Each hour not otherwise credited under the Plan for which back pay, irrespective
of mitigation of damages, has either been awarded or agreed to by the Employer.
Such hours are to be credited to the period or periods to which the award or
agreement pertains. If this provision results in an Employee becoming an
Eligible Participant for a Plan Year in which he was not otherwise an Eligible
Participant, the Administrative Committee shall establish equitable procedures
for determining and allocating any resulting amounts to such Employee’s Account.
             
E.
Solely for purposes of determining whether a Break in Service has occurred, each
hour not otherwise credited under the Plan that would have been credited if the
Employee had not been absent:
               
1.
By reason of pregnancy or the birth of a child of the Employee;
               
2.
By reason of the placement of a child with the Employee in connection with his
adoption of such child; or
               
3.
For purposes of caring for any such child for a period beginning immediately
following such birth or placement.
               
In any case in which the Company is unable to determine the number of hours
which would otherwise normally have been credited to such Employee (but for such
absence), such individual shall be credited with eight (8) Hours of Service for
each day of such absence. The hours described in this article shall be treated
as Hours of Service only in the Eligibility Computation Period in which the
absence from work begins if the Employee would thereby be prevented from
incurring a Break in Service in such Eligibility Computation Period or, in any
other case, in the next following Eligibility Computation Period.

 
 
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F.
Each hour for any period during which an Employee is not paid but is on an
approved leave of absence, military duty or is temporarily laid off, provided
that the Employee:
               
1.
Returns to the employment of the Employer immediately after the expiration of
the leave or layoff, or in the case of military duty, within one hundred twenty
(120) days or such longer period as may be prescribed by USERRA or other
applicable law, after first becoming eligible for military discharge; and
               
2.
Remains in the employment of the Employer for at least thirty (30) days after
such return; or
               
3.
Fails to return or remain employed as provided above by reason of his death,
Disability or retirement.
               
Hours of credit for such periods shall be based on a forty (40) hour work week
or, if different, on the Employee’s normally scheduled hours per week. However,
if the Employee fails to return to the employment of the Company or to remain in
the employment of the Company for at least thirty (30) days after his return for
reasons other than his death, Disability or retirement, then his original leave
date shall be deemed to be his termination date.
             
G.
No more than five hundred one (501) Hours of Service shall be credited under
this article to an Employee on account of any single continuous period of time
during which the Employee performs no duties for the Company.
           
11.03
Crediting Of Hours Subject To Regulation.
             
The calculation of the number of Hours of Service to be credited under article
for periods during which no duties are performed, and the crediting of such
Hours of Service to periods of time for purposes of computations under the Plan,
shall be determined by the Administrative Committee in accordance with the rules
set forth in the Department of Labor Regulation section 2530-200b-2 paragraphs
(b) and (c), which rules shall be consistently applied with respect to all
Employees within the same job classifications.

 
 
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11.04
Uniformed Services Employment And Reemployment Rights Act Of 1994.
             
Effective as of December 12, 1994 or such later date as may be applicable to
this Plan under section 8(h)(2) of the Uniformed Services Employment And
Reemployment Rights Act of 1994 (USERRA), an Employee, who was absent from the
Employee’s position of employment by reason of service in the uniformed services
and who is reemployed, as these terms are used in USERRA, shall be treated as
not having incurred a break in service with the Employer maintaining the Plan by
reason of such person’s period or periods of service in the uniformed services.
Each period served by a person in the uniformed services shall, upon
reemployment under USERRA, be deemed to constitute service with the Employer
maintaining the Plan for the purpose of determining the nonforfeitability of the
person’s vested Account and for the purpose of determining the accrual of
benefits under the Plan, all to the extent required by and as provided under
USERRA.
           
ARTICLE XII. FIDUCIARY RESPONSIBILITY
           
12.01
Authority.
             
The authority to control and manage the operation and administration of the Plan
shall be allocated as provided in this Plan and Trust Documents between the
Board and the Administrative Committee, all of whom are named fiduciaries under
ERISA.
             
In addition, procedures for the appointment of another fiduciary, or an
investment manager, are described in the Delegation Of Authority article.
           
12.02
Interest Of Participants And Beneficiaries.
             
Each fiduciary shall discharge his duties with respect to the Plan solely in the
interest of the Participants and Beneficiaries and:
             
A.
For the exclusive purpose of providing benefits to Participants and their
Beneficiaries;
             
B.
With the care, skill, prudence and diligence under the circumstances then
prevailing that a prudent man acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of a like character and with
like aims; and
             
C.
In accordance with this Plan and Trust Document.

 
 
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12.03
Liability.
             
A fiduciary shall be liable, as provided in ERISA, for any breach of his
fiduciary responsibilities. In addition, a fiduciary under this Plan shall be
liable for a breach of fiduciary responsibility of another fiduciary under this
Plan only as provided under section 405 of ERISA and its regulations.
           
12.04
Dual Capacities.
             
Any person or group of persons may serve in more than one (1) fiduciary capacity
with regard to the Plan. A fiduciary other than the Trustee(s) may, with the
consent of the Board, employ one (1) or more persons to render advice and
assistance with regard to any function such fiduciary has under the Plan. The
expenses of such persons shall be paid by the Company.
           
12.05
Allocation Of Authority.
             
Except as otherwise specifically provided in the Plan and Trust Documents,
including any associated trustee agreement:
             
A.
The Board of Directors shall have the authority to amend and terminate the Plan,
to appoint and remove members of the Administrative Committee, and to appoint
and remove the Trustee(s).
             
B.
The Administrative Committee shall have the authority in their sole discretion
to:
               
1.
Allocate the Company’s Contribution;
               
2.
Maintain separate Accounts for Participants;
               
3.
Furnish and correct errors in statements of Accounts;
               
4.
Determine the method, timing and media of distributions, and direct the
Trustee(s) with respect to distributions;
               
5.
Approve methods of distribution to Beneficiaries;
               
6.
Direct the segregation of assets;
               
7.
Direct distribution of the interests of incompetent persons and minors; and
               
8.
Construe the terms of the Plan and Trust Document and determine all questions of
interpretation and application of their terms to determine Participant benefits
thereunder.

 
 
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C.
The Trustee(s) shall have the authority to:
               
1.
Establish the fair market value of the Trust Fund through the use of qualified
appraisers;
               
2.
To value segregated Accounts;
               
3.
To employ advisors, agents and counsel;
               
4.
To hold the Trust assets and to render accounts of their administration of the
Trust;
               
5.
To vote the Trust’s shares of the Company if and as provided in Voting Powers
article;
               
6.
Determine the amount and allocation of the Trust income or loss; and
               
7.
Appoint and delegate duties to an investment manager.
           
12.06
Prohibited Transaction.
             
A fiduciary shall not cause the Plan to engage in a transaction if he knows or
should know that such transaction constitutes a prohibited transaction under
section 406 of ERISA or Code section 4975, unless such transaction is exempted
under section 408 of ERISA or Code section 4975.

 
ARTICLE XIII. ADMINISTRATIVE COMMITTEE
           
13.01
Administrative Committee.
             
The Board of Directors shall appoint an Administrative Committee to manage and
administer this Plan in accordance with the provisions hereof. Each member shall
serve for such term as they may designate or until a successor member has been
appointed or until removal by the Board. Vacancies due to resignation, death,
removal or other cause shall be filled by the Board. Members who are full-time
employees of the Company shall serve without compensation for Administrative
Committee service. All reasonable expenses of the Administrative Committee shall
be paid by the Company.
           
13.02
Action.
             
The Administrative Committee shall act by agreement of a majority of its
members, either by voting at a meeting or in writing without a meeting. By such
action, it may authorize one (1) or more members to execute documents on its
behalf. The Trustee(s), upon written notification of such authorization, shall
accept and rely upon such documents until notified in writing that the
authorization has been revoked by the Administrative Committee. The Trustee(s)
shall not be deemed to be on notice of any change in the membership of the
Administrative Committee unless notified in writing. A member of the
Administrative Committee, who is also a Participant in the Plan, shall not vote
or act upon any matter relating solely to himself. In the event of a deadlock or
other situation that prevents agreement of a majority of the Administrative
Committee members, the matter shall be decided by the Board.

 
 
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13.03
Records.
             
The Administrative Committee shall keep on file a copy of this Plan and Trust,
including any subsequent amendments, all annual and interim reports of the
Trustee(s) and the latest annual report, Plan description and Summary Plan
Description required under Title I of ERISA for examination by Participants
during business hours. The Administrative Committee is the Plan Administrator
under ERISA and the Administrative Committee shall have the duty and authority
to comply with those reporting and disclosure requirements of ERISA which are
specifically required of the Plan Administrator.
             
The Administrative Committee hereby specifically delegates to the Trustee(s) the
responsibility to be liable for income tax withholding, and to withhold the
appropriate amount from any payment made from the Trust to a Participant or
Beneficiary under the provisions of applicable law and regulation. The
Administrative Committee shall furnish the Trustee(s) with all information
necessary to such withholding function, as set forth in regulations, or, if such
information is not provided to the Trustee(s), the Administrative Committee
shall assume all relevant liability.
           
13.04
Power.
             
The Administrator shall have the discretionary authority to interpret and
construe the provisions of this Plan and to decide any disputes and resolve any
ambiguities which may arise relative to the rights of the Employees, past and
present, and their Beneficiaries, under the terms of the Plan; provided,
however, that whenever, in the administration of the Plan, any discretionary
action by the Administrator is required, the Administrator shall exercise its
authority in a nondiscriminatory manner so that all persons similarly situated
will receive substantially the same treatment.
             
The Administrative Committee shall have the power and duty to do all things
necessary or convenient to effect the intent and purpose of this Plan and, not
inconsistent with any of the provisions thereof, whether or not such powers and
duties are specifically described herein and, not in limitation but in
amplification of the foregoing, and to determine all questions that shall arise
hereunder, including (if the Trustee(s) is a directed Trustee(s)) directions to
and questions submitted by the Trustee(s) on all matters necessary for it to
properly discharge its power and duties. Decisions of the Administrative
Committee made in good faith upon any matters within the scope of its authority
shall be final and binding on the Company, the Trustee(s), the Participants and
their Beneficiaries. The Administrative Committee, at all times, in making and
carrying out its decisions and directions, shall act in a uniform and
nondiscriminatory manner and may from time to time prescribe and modify uniform
rules of interpretation and administration.

 
 
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13.05
Funding Policy.
             
The Administrative Committee may recommend a Funding Policy for the Trust Fund,
regarding existing Trust Fund assets, bearing in mind both the short-run and
long-run needs and goals of the Plan. The Administrative Committee shall review
such policy prior to the end of each Plan Year for its appropriateness under the
circumstances then prevailing. The Funding Policy shall be communicated to the
Trustee(s) and the investment manager of the Trust Fund, if an investment
manager has been appointed, so that the investment policy of existing Trust Fund
assets can be coordinated with Plan needs. Such Funding Policy shall not,
however, be binding on the Company or constitute a request or recommendation or
an obligation to contribute cash or Company Stock to the Plan by the Company.
           
13.06
Agents.
             
With the approval of the Board, the Administrative Committee may from time to
time or on a continuing basis, retain such agents or advisors as are reasonably
necessary to assist it in the proper performance of its duties, specifically
including legal counsel, accountants, actuaries, investment counsel, consultants
and administrative assistants. The expenses of such agents or advisors may be
paid by the Company or, if not so paid, the Administrative Committee may direct
that such expenses be paid from the General Trust Fund.
           
13.07
Claims.
             
ERISA requires the Administrative Committee to establish procedures for
processing claims which afford Participants a reasonable opportunity for a full
and fair review of their claims. These claims procedures contain the provisions
required by the Labor Regulations at 29 CFR 2520.503-1. The Administrative
Committee shall have absolute discretion to determine Participants’ and
Beneficiaries’ rights to benefits under the Plan. All benefit claim decisions
will be made in accordance with the terms of the Plan documents and the Plan
terms will be applied consistently to all claimants.

 
 
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A Claimant must submit a written claim and exhaust the following claims
procedures before legal recourse of any type is sought:
             
A.
Filing A Benefit Claim.
               
A Participant, a Beneficiary or his or her representative can initiate the
benefit claim process by submitting to the Administrative Committee fully
completed distribution election forms, if needed, or a letter clearly stating
that a claim is being filed. A claim shall not be deemed to be “filed” for the
purposes of these claim and appeals procedures however, until all necessary and
applicable forms are completed and submitted to the Administrative Committee. A
claim will be considered submitted if delivered to a member of the
Administrative Committee directly, or to the Administrative Committee, in care
of the office of the Employer which handles personnel and human resources
matters.
             
B.
Notice Of Benefit Denial.
               
1.
Timing Of Notice.
                 
If a benefit claim is wholly or partially denied, the Administrative Committee
will notify the Participant, the Beneficiary or his or her representative of the
denial within a reasonable period of time, but no later than ninety (90) days
after the Plan’s receipt of the claim. If the Administrative Committee
determines that an extension of the time for processing the claim is needed, the
Administrative Committee will notify the Participant, the Beneficiary or his or
her representative of the reasons for the extension and the extended due date
before the end of the ninety (90) day period after the filing of the claim. The
extended period will not exceed one hundred eighty (180) days after the date of
the filing of the claim.
               
2.
Content Of Notice.
                 
A notice of a benefit denial will be provided in either written form or via
e-mail. The notice will provide the following information:
               
a.
The specific reason(s) for the denial;
               
b.
Reference to the specific plan provisions on which the denial is based;
               
c.
A description of any additional information necessary for the claim to be
granted and an explanation of why such information is necessary; and
               
d.
A description of the claim review procedures, the time limits under the
procedures and a statement regarding your right to bring a civil action under
ERISA section 502(a) following a benefit appeal.

 
 
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C.
Appeal Of Benefit Denial.
               
1.
Review Process.
                 
The review process will be as follows:
               
a.
A Participant, Beneficiary or representative will have sixty (60) days following
receipt of the notice of benefit denial in which to file an appeal of the
decision with the Administrative Committee;
               
b.
A Participant, Beneficiary or representative may submit written comments,
documents, records and other information related to the benefit claim on appeal;
               
c.
A Participant, Beneficiary or representative will be provided, upon request and
free of charge, access to and copies of all documents, records and other
information relevant to the benefit claim (a document is considered relevant to
the claim if it: (i) was relied upon in making the benefit decision; (ii) was
submitted, considered or generated in the course of making the benefit decision,
without regard as to whether it was relied upon in making the decision; or (iii)
demonstrates compliance in making the benefit decision with the requirement that
benefit decisions must follow the terms of the plan and be consistent when
applied to similarly situated claimants); and
               
d.
The review on appeal will consider all comments, documents, records and other
information submitted by the Participant, without regard to whether such
information was submitted or considered in the initial benefit denial.
               
2.
Timing Of Notice Of Appeals Decision.
                 
The Administrative Committee will notify the Participant, Beneficiary or his or
her representative of the appeals decision (whether or not a complete or partial
denial) within a reasonable period of time, but no later than sixty (60) days
after the Plan’s receipt of the appeal. If the Administrative Committee
determines that an extension of the time for processing the claim is needed, the
Administrative Committee will notify the Participant, Beneficiary or his or her
representative of the reasons for the extension and the extended due date before
the end of the sixty (60) day period after the filing of the appeal. The
extended period will not exceed one hundred twenty (120) days after the date of
the filing of the appeal.

 
 
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3.
Content Of Notice Of Appeals Decision.
                 
A notice of a benefit determination on appeal will be provided in written form
or via e-mail. If the decision is in whole or in part a denial of the appeal,
the notice will provide the following information:
               
a.
The specific reason(s) for the denial;
               
b.
Reference to the specific plan provisions on which the denial is based;
               
c.
A statement that the Participant, Beneficiary or representative is entitled to
receive, upon request and free of charge, access to and copies of all documents,
records and other information relevant to the benefit claim (a document is
considered relevant to the claim if it: (i) was relied upon in making the
benefit decision; (ii) was submitted, considered or generated in the course of
making the benefit decision, without regard as to whether it was relied upon in
making the decision; or (iii) demonstrates compliance in making the benefit
decision with the requirement that benefit decisions must follow the terms of
the plan and be consistent when applied to similarly situated claimants); and
               
d.
A statement regarding the Participant’s or Beneficiary’s right to bring a civil
action under ERISA section 502(a) following a benefit denial on appeal.
           
13.08
Indemnity.
             
To the fullest extent permitted by law, the Company agrees to indemnify, defend
and hold harmless the members of the Administrative Committee, both individually
and collectively, against any liability whatsoever for any action taken or
omitted by them in good faith in connection with the administration of this Plan
and Trust and for any expenses or losses for which they may become liable as a
result of any such actions or nonactions, unless a proximate result of their own
willful misconduct. The Company may purchase insurance for the Administrative
Committee to cover any of their potential liabilities with regard to the Plan
and Trust.
           
13.09
Administrative Committee Duties.
             
In addition to the duties contained in this Article XIII, the Administrative
Committee is required to provide any necessary instructions to the Trustee under
the terms of this Article XIII, Article XV and any associated trust agreement
entered into by the Employer and a directed or custodial trustee.

 
 
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ARTICLE XIV. INVESTMENTS
           
14.01
Investment Objective.
             
It shall be the objective of this Trust to invest primarily (up to one hundred
percent (100%) of its assets) in Company Stock. Without limiting the generality
of the foregoing, the Trustee(s) may invest in bonds, notes, mortgages,
commercial or federal paper, preferred stock, common stock, or other securities,
rights, obligations or property, real or personal, including shares and
certificates of participation issued by investment companies or investment
trusts. The Trustee(s) may cause any part or all of the assets of this Trust to
be commingled with the assets of a similar trust qualified under Code sections
401(a) and 501(a) by causing such assets to be invested as part of a common fund
of the Trustee(s) or other fiduciary, the provisions of which are hereby
adopted. The Trustee(s) may hold such portion of the Trust as may be deemed
necessary for the ordinary administration of the Trust Fund and disbursement of
funds by depositing the same in any bank or savings and loan institution subject
to the rules and regulations governing such deposits.
             
To prevent any allocation of Company Stock or Plan asset in lieu of Company
Stock in any Plan Year which would otherwise cause any Participant to become a
Disqualified Person or cause any Plan Year to become a Nonallocation Year, the
Trustee(s) may cause the Administrative Committee to rebalance the ratio of cash
and Company Stock in each Participant’s account as described in Prohibited
Allocation Of Stock For S Corporations article, above.
           
14.02
Investment Directives.
             
To the extent permitted by law, the Trustee(s) shall not be liable for the
making of any investment at the direction of the Administrative Committee, for
the retention of any such investment in the absence of directions from the
Administrative Committee to dispose of the same, or for the disposal or
encumbrance of any investment at the direction of the Administrative Committee.
           
14.03
Delegation Of Authority.
             
The power of the Trustee(s) to direct, control or manage the investment of the
Trust Fund may be delegated to an investment manager appointed by the
Trustee(s). Such investment manager, if appointed, must acknowledge in writing
that he is a fiduciary with respect to the Trust Fund and shall then have the
power to manage, acquire, or dispose of any asset of the Trust Fund. An
investment manager must be a person who is:
             
A.
Registered as an investment advisor under the Investment Advisors Act of 1940;

 
 
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B.
A bank, as defined in that Act; or
             
C.
An insurance company qualified to perform such services under the laws of more
than one (1) state.
             
If an investment manager has been appointed, the Trustee(s) shall neither be
liable for acts or omissions of such investment manager nor be under any
obligation to invest or otherwise manage any asset of the Trust Fund, and the
Trustee(s) shall not be liable for any act or omission of the investment manager
in carrying out such responsibility except to the extent that the Trustee(s)
violated the Interest Of Participants And Beneficiaries article of this Plan and
Trust Document with respect to:
             
A.
Such designation;
             
B.
The establishment or implementation of the procedures for the designation of an
investment manager; or
             
C.
Continuing the designation, in which case the Administrative Committee would be
liable in accordance with the Liability article.
           
14.04
Participant Voting And Exercise Of Stock Rights.
             
A.
Each Participant shall be entitled to direct the Trustees as to the manner in
which any Qualifying Employer Securities which are a registration-type class of
securities (as defined in Code section 409(e)(4)) which are allocated to the
Employer Account of the Participant are to be voted. With respect to any class
of Qualifying Employer Securities which is not a registration-type class of
securities (as defined in Code section 409(e)(4)), a Participant shall be
entitled to direct the Trustees as to the manner in which voting rights will be
exercised with respect to any corporate matter which involves the voting of such
shares allocated to the Participant’s Company Stock Account with respect to the
approval or disapproval of any corporate merger or consolidation,
recapitalization, reclassification, liquidation, dissolution, sale of
substantially all assets of a trade or business, or such similar transactions as
may be prescribed in Treasury regulations.
             
B.
The Trustees shall notify Participants at least thirty (30) days (or a lesser
period if thirty (30) days if impossible or impractical) prior to the voting or
other exercise of rights referred to in paragraph A of this section. The notice
shall include all proxy solicitations and other materials distributed to other
shareholders holding any of the shares of stock described in this Plan as
Qualifying Employer Securities.

 
 
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C.
The Trustees shall vote any shares and exercise any other rights with respect to
applicable Qualifying Employer Securities in the manner instructed by the
Participant. The Trustees shall follow the provisions of Code section
409(e)(5)(A) and permit each participant one vote each with respect to each such
issue. The Trustees shall vote any shares and exercise any other rights with
respect to Qualifying Employer Securities as to which it receives no such
instructions (either because the Participant does not timely give such
instructions, or because the shares have not yet been allocated to the Employer
Accounts, or if because the Trustees are not required to be directed) in
proportion to the voting instructions given by the participants who do direct
the Trustee to vote the shares in their accounts.
           
14.05
Loans.
             
A.
The Trustee(s) may incur a loan on behalf of the Trust in a manner and under
conditions that will cause the loan to be an “Exempt Loan” within the meaning of
Code section 4975(d)(2) and regulations thereunder. Any such loan shall be used
primarily for the benefit of Plan Participants and their Beneficiaries. The
proceeds of each such loan shall be used within a reasonable time after the loan
is obtained, only to purchase Company Stock, to repay the loan or to repay any
prior loan used to purchase Company Stock. Except as otherwise provided in the
Plan with respect to Right of First Refusal or the Put Option, no security
acquired with the proceeds of an exempt loan may be subject to a put, call, or
other option, or buy-sell or similar arrangement while held by and when
distributed from the Plan, whether or not the Plan is then an ESOP. Any such
loan shall provide for a reasonable rate of interest, an ascertainable period of
maturity and shall be without recourse against the Plan. Any such loan shall be
secured solely by shares of Company Stock acquired with the proceeds of the loan
and shares of such Company Stock that were used as collateral on a prior loan
which was repaid with the proceeds of the current loan. Such Company Stock
pledged as collateral shall be placed in a Suspense Account and released
pursuant to the Allocations Of Contributions And Forfeitures article as the loan
is repaid. Company Stock released from the Suspense Account shall be allocated
in the manner described in the Allocations Of Contributions And Forfeitures
article. No person entitled to payment under a loan made pursuant to this
article shall have recourse against any Trust Fund assets other than the Company
Stock used as collateral for the loan, Company Contributions of cash that are
available to meet obligations under the loan and earnings attributable to such
collateral and the investment of such Contributions. Participating Employer
Contributions made with respect to any Plan Year during which the loan remains
unpaid, and earnings on such Contributions, shall be deemed available to meet
obligations under the loan, unless otherwise provided by the Company at the time
such Contributions are made.

 
 
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B.
Any pledge of Company Stock as collateral under this article shall provide for
the release of shares so pledged upon the payment of any portion of the loan.
Shares so pledged shall be released under the appropriate formula for the
particular terms of the loan as provided in the Allocations Of Contributions And
Forfeitures article and Treasury Regulation 54.4975-7(b)(8).
             
C.
Payments of principal and interest on any loan under this article shall be made
by the Trustee(s) solely from:
               
1.
Company Contributions available to meet obligations under the loan;
               
2.
Earnings from the investment of such Contributions including dividends on
Company Stock;
               
3.
Earnings attributable to Company Stock pledged as collateral for the loan;
               
4.
The proceeds of a subsequent loan made to repay the loan; and
               
5.
The proceeds of the sale of any Company Stock pledged as collateral for the
loan.
                The Contributions and earnings available to pay the loan must be
accounted for separately by the Administrative Committee until the loan is
repaid.              
D.
Subject to the limitations on Annual Additions to a Participant’s Account,
assets released from a Suspense Account by reason of payment made on a loan
during a Plan Year shall be allocated to the accounts of all Participants
entitled to an allocation of Contributions on the last day of the Plan Year.
           
14.06
Diversification.
             
Any Qualified Participant shall have the right to make an election to direct the
Plan as to investment of a portion of his ESOP Account. Such a Qualified
Participant may elect within ninety (90) days after the close of each of the six
(6) Plan Years beginning with the Plan Year in which the Participant becomes a
Qualified Participant to diversify twenty-five percent (25%) of his Account,
less any amount to which a prior diversification election applies. In the case
of the last year to which an election applies, fifty percent (50%) shall be
substituted for twenty-five percent (25%).

 
 
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The Plan shall meet these requirements of Code section 401(a)(28) either by
distributing the portion of the Account covered by the election to the
Participant within the ninety (90) day period following the Participant’s ninety
(90) day Election period in the form of cash; or by offering at least three (3)
investment options, which may be made available in another qualified plan
maintained by the Employer and to which the Participant’s diversified portion of
his ESOP account may be transferred.
             
For purposes of this section, the term:
               
“Qualified Participant” means any Employee who has completed at least ten (10)
years of active or inactive (as described in the Inactive Participant article)
participation under the Plan, and has attained age fifty-five (55).
               
“Qualified Election Period” means the six (6) Plan Year period beginning with
the later of:
               
1.
The first Plan Year in which the Employee first became a Qualified Participant,
or                
2.
The first Plan Year beginning after December 31, 1986.            
ARTICLE XV. TRUSTEE(S)
           
15.01
Application of Trust Provisions.
             
The Trust provisions of this Plan and Trust Document are controlling unless the
Employer has entered into a trust agreement with a third party independent,
directed or custodial trustee. If the Employer enters into such a trust
agreement, the trust provisions of this Plan and Trust Document cease to apply
and the provisions of that instrument shall then apply. In the event the
Employer, terminates such agreement and appoints a successor trustee pursuant to
the Vacancy and Successors article, the successor trustee shall be required to
sign this Plan and Trust Document .
           
15.02
Duties.
             
The Board of Directors shall appoint a Trustee or Trustees. The duties of the
Trustee(s) shall include but not be limited to receiving and paying funds of the
Trust, safeguarding and valuing Trust assets, investing and reinvesting the
Trust Funds, as provided in the Investments article, and carrying out the
directions of the investment manager, if an investment manager has been
appointed, pursuant to the Delegation Of Authority article. The directions of an
investment manager shall be in writing or in such other form as is acceptable to
the Trustee(s). The signature of the Trustee(s) shall be binding upon all
Co-Trustee(s).

 
 
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15.03
Ownership.
             
The Trustee(s) shall not maintain the indicia of ownership of any Trust assets
outside the jurisdiction of the district courts of the United States, except as
authorized by regulations issued by the Department of Labor.
           
15.04
Powers.
             
In the discharge of duties, the Trustee(s) shall have all the powers, authority,
rights and privileges of an absolute Owner of the Trust Fund and, not in
limitation of, but in amplification of the foregoing; may receive, hold, manage,
invest and reinvest, sell, exchange, dispose of, encumber, hypothecate, pledge,
mortgage, lease, grant options respecting, repair, alter, insure, or distribute
any and all property in the Trust Fund; may borrow money, participate in
reorganizations, pay calls and assessments, vote or execute proxies, exercise
subscription or conversion privileges and register in the name of a nominee any
securities in the Trust Fund; may renew, extend the due date, compromise,
arbitrate, adjust, settle, enforce or foreclose by judicial proceedings or
otherwise defend against the same, any obligations or claims in favor of or
against the Trust Fund; may exercise options, employ agents; and, whether herein
specifically referred to or not; may do all such acts, take all such actions and
proceedings and exercise all such rights and privileges as if the Trustee(s)
were the absolute Owners of any and all property in the Trust Fund. The
Trustee(s) shall have no authority or duty to determine the amount of any
Company Contribution or to enforce the payment of any Company Contribution to
them.
           
15.05
Fees.
             
The Trustee(s)’ fees for their services as Trustee(s) shall be such as may be
mutually agreed upon by the Company and the Trustee(s), and such fees shall be
paid by the Company. No individual Trustee(s) who already receives full-time pay
from the Employer, or an association of employers, whose employees are
participants in the Plan, may receive compensation from the Trust except for
reimbursement of expenses properly and actually incurred, and shall serve
without Compensation for their service as such. However, with the approval of
the Company, individual Trustee(s) may from time to time or on a continuing
basis, retain such agents or advisors, including specifically accountants,
attorneys, investment counsel and administrators, as they consider necessary to
assist them in the proper performance of their duties. The expenses of such
agents or advisors and all other expenses of the Trustee(s) shall be paid by the
Company, and if such expenses remain unpaid for a period of sixty (60) days,
they may be paid from the General Trust Fund. The Trustee(s) shall be entitled
to charge such fees and expenses to the Trust Fund if such fees and expenses
remain unpaid for a period of sixty (60) days after an appropriate billing is
mailed by the Trustee(s) to the Company.

 
 
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15.06
Accounting.
             
Within sixty (60) days or within a reasonable period following the close of each
Plan Year, the Trustee(s) shall render to the Company an accounting of their
administration of the Trust during the preceding year. The Trustee(s) shall also
report to the Administrative Committee respecting determinations of the value of
the Trust Fund, as provided in the Valuation Of Trust Fund and Limitation And
Suspense Accounts articles. If the Trustee(s) determine that the Trust Fund
consists, in whole or in part, of property not traded freely on a recognized
market or that information necessary to ascertain the fair market value thereof
is not readily available to the Trustee(s), the Trustee(s) shall determine the
fair market value of such property for all purposes under the Plan and Trust
Document. In such event, the fair market value placed upon such property by the
Trustee(s) shall be conclusive and binding. However, in valuing Company Stock
held by the Trust, the Trustee(s) shall take such action as is required to
ascertain the fair market value of such property including the retention of such
counsel and independent appraisers as it considers necessary. Consistent with
the foregoing, if the Company Stock is or becomes not readily tradable on an
established securities market, then any valuation required under this Plan will
be conducted for the Trustee(s) by a qualified independent appraiser (as defined
in Code section 401(a)(28)).
           
15.07
Resignation.
             
The Trustee(s) may resign at any time upon thirty (30) days written notice to
the Company and the Administrative Committee or such shorter period as may be
agreeable to the Company; provided that upon receipt of instructions or
directions from the Company or the Administrative Committee with which the
Trustee(s) are unable or unwilling to comply, the Trustee(s) may resign upon
written notice to the Company and the Administrative Committee, given within a
reasonable time under the circumstances then prevailing. After receipt of such
instructions or directions and, after resignation, the Trustee(s) shall have no
liability to the Company, the Administrative Committee, or any person interested
herein for failure to comply with such instructions or directions. The Company
may remove the Trustee(s) without cause at any time upon thirty (30) days
written notice. In case of resignation or removal of the Trustee(s), the said
Trustee(s) shall have the right of a settlement of Accounts, which may be made
at the option of the Trustee(s), either by judicial settlement in an action, in
a court of competent jurisdiction, or by agreement of settlement between the
Trustee(s) and the Company; and the Trustee(s) shall not be required to transfer
assets of the Trust Fund to a successor Trustee(s) under the Vacancy And
Successors article or otherwise until their Accounts have been settled.

 
 
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15.08
Effect Of Final Accounting.
             
The written approval of any Trustee(s) accounting by the Company or
Administrative Committee shall be final as to all matters and transactions
stated or shown therein and binding upon the Company, Administrative Committee,
and all persons who then shall be or thereafter shall become interested in this
Trust. Failure of the Company or Administrative Committee to notify the
Trustee(s) within ninety (90) days after receipt of any accounting of its
disapproval of such accounting shall be the equivalent of written approval.
           
15.09
Vacancy And Successors.
             
Resignation or removal of the Trustee(s) shall not terminate the Trust. In the
event of vacancy in the Trusteeship of this Trust occurring at any time by
resignation, removal or death or incapacity, the Company shall appoint a
successor Trustee(s) to take the place of such Trustee(s). Any successor
Trustee(s) shall have all the powers and duties herein conferred upon the
original Trustee(s). The title to all Trust property shall automatically vest in
a successor Trustee(s) without the execution or filing of any instrument or the
doing of any act, but the resigning or removal of Trustee(s) shall,
nevertheless, execute all instruments and do all acts which would otherwise be
necessary to vest such title in any successor. The appointment of a successor
Trustee(s) may be effected by the Board action to appoint, with documentation of
the successor Trustee(s) accepting appointment to act as such being evidenced by
its execution of a copy of this Plan Document or by execution of a written
acknowledgement of the complete terms of this Plan and Trust Document.
           
15.10
Legal Counsel.
             
The Trustee(s) may consult with legal counsel (who may or may not be counsel to
the Company) concerning any question which may arise with reference to their
duties under this Plan.
           
15.11
Investigation.
             
The Trustee(s) shall not be required to make any investigation to determine the
identity or mailing address of any person entitled to benefits under this Plan
and shall be entitled to withhold making payments until the identity and mailing
address of any person entitled to benefits are certified by the Administrative
Committee. In the event that any dispute arises as to the identity or rights of
persons entitled to benefits hereunder, the Trustee(s) may withhold payment of
benefits until such dispute has been determined by a court of competent
jurisdiction or has been settled by written stipulation of the parties
concerned.

 
 
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15.12
Unanimous Vote.
             
The action of the Trustee(s) shall be determined by unanimous vote or other
affirmative expression of all of the Trustee(s), and they shall designate one
(1) of their members to keep a record of their determination of matters to be
determined hereunder and of all dates, documents and other matters pertaining to
their administration of this Trust; however, no Trustee(s) who is a Participant
shall vote on any action relating specifically to himself, and in the event the
remaining Trustee(s) by unanimous vote thereof are unable to come to a
determination of any such question, the same shall be determined by the Board.
           
15.13
Indemnification.
             
To the fullest extent permitted by law, the Company agrees to indemnify, to
defend, and to hold harmless the Trustee(s), individually and collectively,
against any liability whatsoever for any action taken or omitted by them in good
faith in connection with this Plan and Trust or their duties hereunder and for
any expenses or losses for which they may become liable as a result of any such
actions or nonactions unless resulting from their own willful negligence or
misconduct; and the Company may purchase insurance for the Trustee(s) to cover
any of their potential liabilities with regard to the Plan and Trust.
           
ARTICLE XVI. AMENDMENT, TERMINATION AND MERGER
           
16.01
Irrevocable Trust.
             
The Trust shall be irrevocable but shall be subject to amendment and termination
as provided in this article.
           
16.02
Amendment.
             
The Company reserves the right to amend this Plan and Trust Document to any
extent and in any manner that it may deem advisable by action of the Board. The
Company, the Trustee(s), all Participants, their Beneficiaries and all other
persons having any interest hereunder shall be bound by any such amendment;
provided, however, that no amendment shall:
             
A.
Cause or permit any part of the principal or income of the Trust to revert to
the Company, except as provided in the Company Contributions article or the
Qualification Notice article, or be used for, or be diverted to, any purpose
other than the exclusive benefit of Participants or their Beneficiaries;
             
B.
Change the duties or liabilities of the Trustee(s) without the Trustee(s)’
written assent to such amendment; or

 
 
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C.
Adversely affect the then vested benefits of any Participants.
             
The Employer may make any amendment it determines necessary or desirable, with
or without retroactive effect to comply with ERISA and the Code.
           
16.03
Contributions.
             
The Company has established the Plan with the bona fide intention and
expectation that the Plan will continue indefinitely, and that it will be able
to make its Contributions indefinitely. Except as it relates to the requirements
to repay an “Exempt Loan” as defined in Code section 4975(d)(2), used to acquire
Company Stock, the Company shall not be under any obligation to continue its
Contributions or to maintain the Plan for any given length of time. The Company
may, in its sole discretion, completely discontinue its Contributions or
terminate the Plan at any time without any liability whatsoever. The Company
shall be under no obligation to maintain the Plan for its own Employees for any
given length of time and may, in its sole discretion, terminate the Plan at any
time without any liability whatsoever. In the event of the earlier of:
             
A.
The termination of this Plan; or
             
B.
The complete discontinuance of Company Contributions hereunder, the full value
of the Accounts of all affected Participants shall become fully vested and
nonforfeitable.
             
In the event of partial termination of this Plan, the full value of the Accounts
of the Participants involved in the partial termination shall become fully
vested and nonforfeitable.
           
16.04
Termination.
             
The Plan shall terminate:
             
A.
Upon the date specified in a written notice of the termination of the Plan,
executed by the Company and delivered to the Trustee(s); or
             
B.
Upon the earlier of:
               
1.
The complete accomplishment of all purposes for which the Plan was created; or
               
2.
The death of the last person entitled to receive any benefits hereunder who is
living at the date of execution of the Plan and Trust Document; provided,
however, that if, upon the death of such last survivor, the Trust may continue
for a longer period without violation of any law of the jurisdiction to which
the Trust is subject. The Trust shall not be terminated upon the death of such
last survivor but shall continue until the complete accomplishment of all the
purposes for which the Plan and Trust are created, unless sooner terminated
under the other provisions hereof.

 
 
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16.05
Distribution Upon Termination.
             
Upon the termination of this Plan and after payment of all expenses of the
Trust, including any Compensation then due to the Trustee(s) and agents of the
Administrative Committee, the Trust assets and all Participants’ Accounts shall
be revalued according to the procedures provided in the Allocation Of Trust
Income Or Loss article. Limitation Accounts and Suspense Accounts held pursuant
to the Allocation Of Trust Income Or Loss and Contributions articles,
respectively, shall be allocated as of the date the Plan is terminated in
accordance with the Allocation Of Trust Income Or Loss article. The Trustee(s)
shall hold and distribute such Accounts as directed by the Administrative
Committee in accordance with the provisions of the Distributions article. Upon
such termination, all rights, powers, and duties to be exercised or performed by
the Company shall thereafter be exercised or performed by the Administrative
Committee, including the filling of vacancies on the Administrative Committee
and the amending of the Plan. In the event the Administrative Committee is
unable to perform, all rights, powers and duties shall be performed by the
Trustee(s).
           
16.06
Qualification Notice.
             
The Company’s obligation to make Contributions hereunder is conditioned upon the
timely submission within the initial period under Code section 401(b), and
receipt of an initial notification from the United States Department of the
Treasury that this Plan is considered a qualified Plan under Code section 401(a)
and that this Trust is considered exempt from taxation under Code section
501(a). If such initial notification is not received, the Company and any
Participant who has made Contributions hereunder shall be entitled to recover
from the Trustee(s) the full amount of the then value of such Contributions
within one (1) year after the date the initial qualification is denied, but only
if the application for qualification is made by the time prescribed by law for
filing the Employer’s return for the taxable year in which the Plan is adopted,
or such later date as the Secretary of the Treasury may prescribe. Prior to the
receipt of such notification, no Participant hereunder or his Beneficiary shall
have any vested interest in, or be entitled to, any benefit payments based on
Company Contributions made hereunder; provided, however, that upon receipt of
such notification, such vestings or entitlements shall be retroactive to the
date of their occurrence in accordance with the other provisions of this Plan,
and this article shall be of no further force or effect.

 
 
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16.07
Reversion.
             
Except as provided in the Company Contributions and Qualification Notice
articles, in no event shall any part of the principal or income of the Trust
revert to the Company or be used for or diverted to any purpose other than the
exclusive benefit of Participants or their Beneficiaries.
           
16.08
Merger.
             
In the case of any merger or consolidation with, or transfer of assets and
liabilities to, any other plan, provisions shall be made so that each
Participant in the Plan on the date thereof, if the Plan had then been
terminated, would receive a benefit immediately after the merger, consolidation
or transfer which is equal to or greater than the benefit he would have been
entitled to receive immediately prior to the merger, consolidation, or transfer,
if the Plan had then terminated. The Plan is specifically authorized to accept
transfers from, consolidate or merge with, plans of the Company.
           
ARTICLE XVII. ASSIGNMENTS
           
17.01
Alienation And QDROs.
             
Except as provided below, the interest herein, whether vested or not, of any
Participant, former Participant or Beneficiary, shall not be subject to
alienation, assignment, pledging, encumbrance, attachment, garnishment,
execution, sequestration, or other legal or equitable process, or
transferability by operation of law in the event of bankruptcy, insolvency or
otherwise.
             
The provisions of this article shall not prevent the creation, assignment or
recognition of any individual’s right to a benefit payable with respect to a
Participant pursuant to a Qualified Domestic Relations Order.
             
The Administrative Committee may segregate assets for a Participant’s spouse or
former spouse in accordance with instructions from a duly authorized court of
law, provided such instructions in all respects satisfy the requirements of a
Qualified Domestic Relations Order as defined in Code section 414(p) and as
provided in the Assignments article.
             
A.
“Qualified Domestic Relations Order” or “QDRO” means any judgment, decree or
order which:
               
1.
Relates to the provision of child support, alimony payments or marital property
rights to a spouse, child or other dependent of a Participant;

 
 
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2.
Is made pursuant to a state domestic relations law (including a community
property law);
               
3.
Creates, or recognizes the existence of, an Alternate Payee’s rights to - or
assigns to an Alternate Payee the right to - receive all or a portion of the
benefits payable with respect to a Participant under the Plan;
               
4.
Clearly specifies:
               
a.
The name and last known mailing address (if any) of the Participant and each
Alternate Payee covered by the order (unless such address is otherwise available
to the Administrative Committee);
               
b.
The amount or percentage of the Participant’s benefits to be paid by the Plan to
each such Alternate Payee (or the manner in which such amount or percentage is
to be determined);
               
c.
The number of payments or the period to which the order applies; and
               
d.
Each plan to which the order applies.
               
5.
Does not require the Plan to provide any type, form, timing or option of benefit
not otherwise provided by the Plan to a Participant;
               
6.
Does not require the Plan to provide increased benefits; and
               
7.
Does not require benefits to be paid to an Alternate Payee which are required to
be paid to a different Alternate Payee under another QDRO.
             
B.
The Administrative Committee shall establish reasonable procedures to determine
whether a domestic relations order is a QDRO and to administer distributions
under that QDRO. If any domestic relations order is received by the Plan, the
Administrative Committee shall:
               
1.
Promptly notify the Participant and any Alternate Payee that the order has been
received and of the Plan’s procedures for determining whether the order is a
QDRO; and
               
2.
Determine within a reasonable period after receipt of the order whether it is a
QDRO and notify the Participant and each Alternate Payee of the Administrative
Committee’s determination.

 
 
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C.
During any period in which the issue of whether a domestic relations order is a
QDRO is being determined by the Administrative Committee, a court of competent
jurisdiction or otherwise, the Administrative Committee shall segregate the
amounts which would have been payable to the Alternate Payee during such period
if the order had been determined to be a QDRO. If the order, or a modification
of the order, is determined within eighteen (18) months to be a QDRO, the
Administrative Committee shall segregate the amounts (as adjusted by
attributable investment income or loss), in accordance with the Plan’s
provisions, for the entitled individual(s). If, within eighteen (18) months, the
order is determined not to be a QDRO or its status as a QDRO is not resolved,
the Administrative Committee may pay the segregated amounts (as adjusted by
attributable investment income or loss) to the individual(s) entitled to receive
such amounts absent such order. Any determination that an order is a QDRO made
after the close of the eighteen (18) month period shall be applied prospectively
only.
           
ARTICLE XVIII. MISCELLANEOUS PROVISIONS
           
18.01
Governing Law.
             
All matters regarding the validity, effect, interpretation and administration of
this Plan and Trust Document shall be determined in accordance with the laws of
the State of California, except where preempted by ERISA or other federal
statutes.
           
18.02
Gender.
             
Wherever appropriate, terms used herein in the singular may include the plural
or the plural may be read as the singular, and the masculine gender may include
the feminine, and the neuter may include both the masculine and feminine.
           
18.03
Amendment Of Laws.
             
All references to sections of ERISA or of the Code, or any regulations or
rulings thereunder, shall be deemed to refer to such sections as they may
subsequently be modified, amended, replaced or amplified by any federal
statutes, regulations or rulings of similar application and importance.
           
18.04
Interpretations.
             
All questions of interpretation of these definitions, their application, binding
effect, as well as all issues concerning coverage, benefits and administration
of this Plan shall be resolved by the Administrative Committee, as provided
elsewhere in this Plan, in their sole discretion.

 
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DATED: _______________________________, 2010
       
EMPLOYER
       
NORTH VALLEY BANCORP
       
By:
     
Michael J. Cushman, President

 
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