EXHIBIT 10.01

 

 

AMENDED AND RESTATED ADOPTION AGREEMENT

FOR SONIC CORP. SAVINGS AND PROFIT SHARING PLAN

 

This agreement, executed on the 31st day of December, 2001, by Sonic Corp.
(hereinafter referred to as the “Employer”), a Delaware Corporation, for the
Sonic Corp. Savings and Profit Sharing Plan (hereinafter referred to as the
“Plan”).

 

W I T N E S S E T H

 

WHEREAS, effective September 1, 1984, the Employer established for the exclusive
benefit of its eligible employees and their beneficiaries, a defined
contribution profit sharing plan and trust intended to qualify under Sections
401(a) and 501(a) of the Internal Revenue Code of 1986, as amended (hereinafter
referred to as the “Code”) to recognize the efforts made to its successful
operation by its employees and to reward such contribution; and

 

WHEREAS, the Employer has maintained such plan, heretofore known as the Sonic
Corp. Savings and Profit Sharing Plan (which plan and trust are hereinafter
referred to as the “Plan”), in a manner intended to ensure that the Plan
continues to qualify under Sections 401(a) and 501(a) of the Code, as amended;
and

 

WHEREAS, pursuant to the provisions of Article XIII of the Plan prior to this
amendment and restatement the Employer reserved the right to amend the Plan at
any time and from time to time; and

 

WHEREAS, the Employer intends to provide that the Plan complies with the
Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”),
the Uruguay Round Agreements Act (“GATT”), the Small Business Job Protection Act
of 1996 (“SBJPA”), the Taxpayer Relief Act of 1997 (“TRA ‘97”), the Internal
Revenue Service Restructuring and Reform Act of 1998 (“RRA 98”), the Community
Renewal Tax Relief Act of 2000 (“CRA 2000”), the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”), the Economic Growth and Tax Relief
Reconciliation Act of 2001(“EGTRRA”) and the Code, and the regulations
promulgated thereunder; and

 

WHEREAS, the Plan provisions as required by USERRA, GATT, SBJPA, TRA ‘97, RRA
98, CRA 2000 and EGTRRA have been in operational compliance as of the effective
date of each individual act; and

 

WHEREAS, the Employer desires to amend and restate the Plan effective, December
31, 2001, or the applicable date of the law changes or as otherwise indicated
herein;

 

NOW, THEREFORE, in consideration of the premises and mutual covenants contained
herein, the Employer hereby amends, and restates the Plan in its entirety,
effective December 31, 2001, or the applicable date of the law changes or as
otherwise indicated herein, notwithstanding any other provisions of the Plan to
the contrary as follows:

 

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I.                                         The Employer and Plan Sponsor: Sonic
Corp.

 

A.                                   The Employer and Plan Sponsor’s address and
telephone number are:

 

101 Park Avenue, Suite 1200

Oklahoma City, OK 73102

(405) 280-7654

 

B.                                     The Employer and Plan Sponsor’s taxpayer
identification number:

 

73-1371046

 

C.                                     The Employer and Plan Sponsor’s fiscal
year is:

 

September 1 — August 31

 

D.                                    The Plan Year is the following twelve (12)
consecutive-month period:

 

1.     Effective January 1, 2002, the Plan Year is January 1 — December 31.

 

2.     Prior to January 1, 2002, there was a short plan year from September 1,
2001 —  December 31, 2001.  Prior to this period, the Plan Year was September 1
— August 31.

 

E.                                      The Plan Anniversary Date is:

 

December 31

 

F.                                      The Plan Administrator is:

 

Sonic Corp.

101 Park Avenue, Suite 1200

Oklahoma City, OK 73102

(405) 280-7654

 

G.                                     The original Effective Date of the Plan
is:

 

September 1, 1984

 

H.                                    The Effective Date of this Amendment and
Restatement is:

 

December 31, 2001 or the applicable effective date of the law change or as
otherwise indicated herein.

 

I.                                         The Plan name is:

 

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Sonic Corp. Savings and Profit Sharing Plan (as amended and restated in this
Adoption Agreement and the related basic plan document and subsequent amendments
thereto).

 

J.                                        The Plan Number is:

 

001

 

II.                                     Eligibility and Service:

 

A.                                   Effective September 1, 2000, an Employee
shall be eligible to participate in the Plan on the Entry Date coinciding with
or next following the date the Employee satisfies the following eligibility
requirements:

 

1.     completion of three (3) Consecutive Months of Service.  As used herein, a
month of service means a calendar month during which an employee completes at
least 100 hours of service.

 

2.     Notwithstanding the foregoing, any employee who completes at least 1,000
hours of service in any eligibility computation period, as defined in Section
2.02 of the Basic Plan Document, shall be eligible to participate in the Plan.

 

B.                                     Prior to September 1, 2000, an Employee
was eligible to participate in the Plan on the Entry Date coinciding with or
next following the completion of one (1) Year of Service.

 

C.                                     Effective for Plan Years beginning after
December 31, 2001, Entry Dates shall occur on the first day of each calendar
month.

 

D.                                    Effective for Plan Years beginning prior
to January 1, 2002, Entry Dates were September 1, December 1, March 1 and
June 1.

 

E.                                      Hours of Service shall be actual Hours
of Service determined pursuant to Plan Section 1.33(a)-(f).

 

F.                                      Years of Service with the Employer shall
be determined under the 1,000 Hours of Service Method pursuant to Plan
Section 1.74(a).

 

G.                                     Breaks-in-Service shall have the meaning
set forth in Section 1.09(a) of the Plan.

 

H.                                    All Years of Service with the Employer
shall be credited for purposes of determining eligibility to participate in the
Plan and for purposes of vesting under the Plan.

 

I.                                         Notwithstanding the foregoing or any
other term or provision contained in this Adoption Agreement or the Basic Plan
Document, Special Project Employees shall not be eligible or permitted to
participate in the Plan.  As used herein, the term “Special Project Employee” is
a person who is hired for the purpose of participating or otherwise assisting in
a particular, discrete project which is anticipated to be completed in less than
one (1) year.  Notwithstanding the foregoing exclusion, any employee, including
a Special

 

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Project Employee, who completes 1,000 hours of service in any eligibility
computation period, as defined in Section 2.02 of the Basic Plan Document, shall
be eligible to participate in the Plan.

 

III.           Contributions:

 

A.                                   Salary Deferral Contributions:

 

1.     Effective for Plan Years beginning after December 31, 2001, a Salary
Deferral Contribution will automatically be made for each newly eligible
Participant hired after December 31, 2001, in the amount of 3% of such
Participant’s Plan Year Compensation, unless such Participant elects, within a
reasonable period after receiving the notice or the first day of any subsequent
calendar month, to defer another amount between 0% and 50% of Plan Year
Compensation by completing a Salary Deferral Agreement.

 

2.     Effective for Plan Years beginning on or after December 31, 2001, the
amount specified in a Salary Deferral Agreement by a Participant shall be
between 0% and 50% of each such Participant’s Plan Year Compensation.

 

3.     Effective for Plan Years beginning prior to January 1, 2002, the amount
that could be specified in a Salary Deferral Agreement by a Participant was
between 1% and 11% of each such Participant’s Plan Year Compensation.

 

4.     Salary Deferral Agreements may be modified the first day of each calendar
month.

 

5.     Irrespective of 4. above, Salary Deferral Agreements may be canceled at
any time.

 

6.     Canceled Salary Deferral Agreements may be restarted the first day of any
subsequent calendar month.

 

7.     Irrespective of 4, 5, and 6 above, a modification, cancellation or
restoration of a Salary Deferral Agreement shall not be effective until it is
administratively practical to effect such modification, cancellation or
restoration.

 

B.                                     Matching Contributions:

 

Matching Contributions may be made at the sole discretion of the Employer. 
Matching Contributions, if any, shall be made within the time limits required by
statute, at the Employer’s discretion. In no event shall Matching Contributions,
if any, be made later than the last day of the Plan Year following the Plan Year
for which the contributions are being made.

 

C.                                     Eligibility for Matching Contributions:

 

Participants eligible to receive a Matching Contribution shall be those
Participants who made a Salary Deferral Contribution during the period for which
the match is being made.

 

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D.                                    Maximum Contributions Matched:

 

1.     Subject to the limitations set forth in subparagraph 2 below and
elsewhere in this Adoption Agreement and Basic Plan Document, the amount of the
Employer Matching Contribution, if any, shall be between 0% and 100% (to be
determined at the Employer’s discretion) of the portion of each Participant’s
Salary Deferral Contribution that qualify for a matching contribution.

 

2.     For each Participant, Salary Deferral Contributions exceeding 6% of such
Participant’s Compensation will be disregarded for purposes of a Matching
Contribution.  Catch-up Contributions will be disregarded for purposes of
Matching Contributions, if any.

 

3.     A true-up Matching Contribution, if any Matching Contributions are made,
may be made on behalf of Participants who meet the Code Section 402(g) limit
during the Plan Year and/or on behalf of any other Participants who are
determined by the Employer on a uniform and nondiscriminatory basis, to be
entitled to a true-up Matching Contribution.

 

E.                                      Discretionary Contributions may be made
by the Employer, in its sole discretion.

 

F.                                      Any Discretionary Contribution made by
the Employer shall be allocated in a uniform and non-discriminatory manner in
the ratio that each eligible Participant’s Compensation bears to the total
Compensation of all eligible Participants.

 

G.                                     Eligibility for Discretionary
Contributions:

 

Participants eligible to receive a Discretionary Contribution, if any, shall be
those Participants who have been credited with one (1) Year of Service during
the Plan Year for which such Discretionary Contribution is made and who are
employed on the last day of the Plan Year for which such Discretionary
Contribution is made.  The preceding sentence notwithstanding, a Participant who
has Separated from Service, during the Plan Year for which a Discretionary
Contribution is made, due to retirement, death or Disability, and who is
otherwise eligible to receive an allocation of a Discretionary Contribution,
shall receive an allocation of the Discretionary Contribution for such Plan
Year.

 

H.                                    Catch-up Contributions shall apply to
contributions after December 31, 2001 (as described in Plan Section 3.17).

 

I.                                         Related and Unrelated Rollover
Contributions to the Plan (as described in Plan Section 1.60) shall be allowed
regardless of whether or not the Employee is a Participant.

 

J.                                        Plan-to-Plan transfers directly from
other plans to this Plan, as described in Plan Section 3.12(b) shall be allowed.

 

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K.                                    Nondeductible Employee Contributions shall
not be allowed.

 

IV.           Forfeitures:

 

A.                                   Forfeitures may be used to pay Plan
expenses in accordance with Section 4.06(f)(2) of the Plan; or

 

B.                                     Forfeitures may be used to reduce
Employer Contributions, in accordance with Section 4.06(f)(5) of the Plan.

 

V.                                    Definitions of Compensation:

 

A.                                   Code Section 415(c) Compensation shall be
defined pursuant to 1.11(b)(1) (11) of the Plan, but shall exclude:

 

1.               holiday bonuses;

2.               reimbursements or other expense allowances;

3.               fringe benefits (cash or noncash);

4.               moving expenses;

5.               severance payments; and

6.               welfare benefits.

 

B.                                     For purposes of determining the amount of
Employer Contribution to which a Participant is entitled with respect to a Plan
Year as set forth in Section III.A. through G. Compensation shall be the same as
V.A. above, except it shall, on a uniform and nondiscriminatory basis, be
limited to the period for which an Employee is a Participant in the Plan.

 

C.                                     Code Section 414(s) Compensation shall be
defined as set forth in Plan Section 1.11(d).

 

VI.           Nondiscrimination Testing:

 

A.                                   For the Plan Years ending August 31, 1997
through August 31, 2001 and December 31, 2001, the Employer did not make a
top-paid group election for purposes of identifying Highly Compensated Employees
under Plan Section 1.30.

 

B.                                     For the Plan Years ending August 31, 1997
through August 31, 2001 and December 31, 2001, the Employer did not make a
calendar year election for purposes of identifying Highly Compensated Employees
under Plan Section 1.30.

 

C.                                     For the Plan Years ending August 1997
through August 31, 2001 and December 31, 2001, the current year data method was
used in performing the Actual Deferral Percentage (“ADP”) Test pursuant to Plan
Section 3.05.   For the Plan Years ending August 31, 1997 through August 31,
2001 and December 31, 2001, the current year data method was used in performing
the Actual Contribution Percentage (“ACP”) Test.

 

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D.                                    For Plan Years after December 31, 2001,
the Employer will calculate the ADP Test pursuant to Plan Section 3.05 and the
ACP Test pursuant to Plan Section 3.09 by using the prior year testing method.

 

VII.         Vesting:

 

A.                                   A Participant’s Vested Balance in his/her
Employer Matching Account and Employer Discretionary Account shall be determined
on the basis of the following Vesting Schedule:

 

Years of Service

 

Vested Percentage

 

Less than 1 year

 

0

%

1 year

 

0

%

2 years

 

20

%

3 years

 

40

%

4 years

 

60

%

5 years

 

80

%

6 or more years

 

100

%

 

B.            For the Short Plan Year of September 1, 2001 — December 31, 2001,
Participants who are employed as of December 31, 2001 will be credited with a
year of service towards vesting.

 

VIII.        Distributions and Withdrawals:

 

A.                                   Distributions:

 

1.     The normal form of benefit is a Qualified Joint and Survivor Annuity for
married Participants or a life annuity for unmarried Participants pursuant to
Article VIII.

 

2.     Optional forms of benefits, subject to a Qualified Election (as defined
at Section 1.55), are as follows:

a.  a lump sum pursuant to Plan Section 7.08(a)(1);

b.  installment payments, pursuant to Plan Section 7.08(a)(2); or

c.  an annuity pursuant to Plan Section 7.08(a)(3).

 

B.                                     Financial Hardship Withdrawals of Salary
Deferral Account:

 

1.     Financial Hardship Withdrawals shall be allowed.

 

2.     The permissible reasons for obtaining a Financial Hardship Withdrawal
shall be those permitted under Section 7.11(b) of the Plan.

 

3.     The resources readily available shall be determined in accordance with
the Safe Harbor provisions pursuant to Section 7.11(e) of the Plan. The
appropriate documentation from a third party regarding the types and amounts of
the expenses

 

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relating to the Financial Hardship Withdrawal must be provided by Participants
as described in Section 7.11(b) of the Plan.

 

C.                                     In-Service Withdrawals:

 

1.     Upon attainment of age of 59½, Participants may withdraw all or a portion
of their Vested Account Balance.

 

2.     Participants may withdraw all or any portion of their Unrelated Rollover
Contributions at any time.

 

D.            Disability:

 

The following definition of Disability shall apply rather than the definition in
Plan Section 7.04:

 

Disability shall mean the Participant, because of a physical or mental
disability, will be unable to perform the duties of his customary position of
employment (or is unable to engage in any substantial gainful activity) for an
indefinite period which the Committee considers will be of long continued
duration.  A Participant also is disabled if he incurs the permanent loss or
loss of use of a member or function of the body, or is permanently disfigured,
and incurs a severance from employment.  The Plan considers a participant
disabled on the date the Committee determines the Participant satisfies the
definition of disability.  The Committee may require a Participant to submit to
a physical examination in order to confirm disability.

 

E.             Spousal Consent shall be required prior to a Participant
obtaining a distribution or an in-service withdrawal.

 

IX.         Other Plans of the Employer:

 

The Employer does not maintain another qualified retirement plan.

 

X.          Affiliated Employers:

 

Except for the Employees of the Participating Employers identified under Article
XIII below, Employees of Affiliated Employers shall not be covered under or
eligible to participate in the Plan.

 

XI.         Investments:

 

A.                                   The Employer shall designate the Investment
Options available under the Plan.

 

B.                                     The Plan is intended to be an ERISA
Section 404(c) plan.  Participants may elect or designate their Investment
Options from among the investment options selected by the Employer to be
available under the Plan.  A Participant may direct the investment of all
amounts in all of his/her accounts.

 

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C.                                     Employer Securities shall mean the common
stock of Sonic Corp pursuant to Plan Section 11.04 (a) (1).

D.                                    The Responsible Fiduciary for purposes of
Section 11.04 of the Plan shall be Georgeson Shareholder (formerly known as
Corporate Investor Communication, Inc.).

 

XII.       Plan Loans:

 

Plan Loans shall be permitted.

 

XIII.      Participating Employers:

 

The following Affiliated Employers are intended to be Participating Employers
pursuant to Article XIV of the Basic Plan Document:

 

Sonic Industries, Inc.

Sonic Restaurants, Inc.

 

The Employees of such Participating Employers shall be eligible to participate
in the Plan in accordance with the eligibility requirements set forth herein and
in the Basic Plan Document.

 

This Adoption Agreement shall only be used in conjunction with the Basic Plan
Document identified as the Sonic Corp. Savings and Profit Sharing Plan attached
hereto as Exhibit “A”.

 

IN WITNESS WHEREOF, the Employer has executed this Adoption Agreement and Plan
on the day and year first written.

 

 

EMPLOYER AND PLAN SPONSOR:

 

 

 

SONIC CORP.

 

 

 

W. Scott McLain

 

Name

 

 

 

Chief Financial Officer

 

Title

 

 

 

/s/ W. Scott McLain

 

Signature

 

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SONIC CORP. SAVINGS AND PROFIT SHARING PLAN

 

BASIC PLAN DOCUMENT

 

AND

 

ADOPTION AGREEMENT

 

 

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TABLE OF CONTENTS

 

ARTICLE I.  DEFINITIONS.

 

1.01.

Accounts

 

1.02.

Adoption Agreement

 

1.03.

Affiliate

 

1.04.

Anniversary Date

 

1.05.

Annual Additions

 

(a)

In general

 

(b)

Medical accounts

1.06.

Authorized Absence

1.07.

Annual Limitation

 

1.08.

Beneficiary

 

1.09.

Break-in-Service

 

(a)

1,000 Hours of Service Method

 

(b)

Elapsed Time Method

1.09(A).

Catch-up Contributions

1.10.

Code

 

1.11.

Compensation

 

(a)

In general

 

(b)

415(c) Compensation

 

(c)

414(q) Compensation

 

(d)

414(s) Compensation

1.12.

Disability

1.13.

Discretionary Contributions

 

1.14.

Early Retirement Age

 

1.15.

Earned Income

 

1.16.

Effective Date

 

1.17.

Eligible Employee

 

1.18.

Employee

 

1.19.

Employer

 

1.20.

Employer Account

 

1.21.

Entry Date

 

1.22.

ERISA

 

1.23.

Family Member

 

1.24.

Fiduciary

 

1.25.

Five Percent Owner

 

1.26.

Forfeiture

 

1.27.

414(q) Compensation

 

1.28.

414(s) Compensation

 

1.29.

415(c) Compensation

 

1.30.

Highly Compensated Employee

 

1.31.

Highly Compensated Former Employee

 

1.32.

Highly Compensated Participant

 

1.33.

Hour of Service

 

(a)

In general

 

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(b)

If no duties are performed

 

(c)

Back pay

 

(d)

Employment with Affiliates

 

(e)

Special rules for determining a Break-in-Service

 

(f)

Active Military Duty

 

(g)

Equivalency methods

1.34.

Investment Manager

1.35.

Joint and Survivor Annuity

 

1.36.

Key Employee

 

1.37.

Leased Employee

 

1.38.

Limitation Year

 

1.39.

Matching Contributions

 

1.40.

Maximum Permissible Amount

 

1.40.

Maximum Permissible Amount

 

1.41.

Net Profits

 

1.42.

Nondeductible Employee Account

 

1.43.

Nondeductible Employee Contribution

 

1.44.

Nonhighly Compensated Participant

 

1.45.

Non-Key Employee

 

1.46.

Normal Retirement Age

 

1.47.

Owner-Employee

 

1.48.

Participant

 

(a)

Active Participant

 

(b)

Inactive Participant

 

(c)

Former Participant

1.49.

Plan

1.50.

Plan Year

 

1.51.

Predecessor Employee Account

 

1.52.

Predecessor Employer Account

 

1.53.

Protected Benefit(s)

 

(a)

Accrued benefit of any Participant

 

(b)

Early retirement benefits

 

(c)

Optional form of benefit

1.54.

Qualified Domestic Relations Order

1.55.

Qualified Election

 

1.56.

Qualified Joint and Survivor Annuity

 

1.57.

Qualified Nonelective Contributions

 

1.58.

Qualified Matching Contributions

 

1.59.

Rollover Account

 

1.60.

Rollover Contribution

 

1.61.

Salary Deferral Account

 

1.62.

Salary Deferral Election

 

1.63.

Self-employed Individual

 

1.64.

Separation from Service

 

1.65.

Service

 

1.65(a).

Severance from Employment

 

 

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1.66.

Shareholder-employee

 

1.67.

Spouse or Surviving Spouse

 

1.68.

Top Paid Group

 

1.69.

Total Balance

 

1.70.

Trustee

 

1.71.

Trust Fund

 

1.72.

Valuation Date

 

1.73.

Vested Balance

 

1.74.

Year of Service

 

(a)

1,000 Hours of Service Method

 

(b)

Elapsed Time Method

ARTICLE II.  ELIGIBILITY AND PARTICIPATION

2.01.

Eligibility

 

2.02.

Eligibility Computation Periods

 

2.03.

Years of Service

 

2.04.

Commencement and Termination of Participation

 

(a)

Application for Participation

 

(b)

Effective Date of Participation

 

(c)

Determination of Eligibility

 

(d)

Forms for Participation

 

(e)

Reemployment

 

(f)

Termination of Eligibility

 

(g)

Inclusion of an Ineligible Employee

 

(h)

Omission of an Eligible Employee

2.05.

Acquisitions

 

(a)

In general

 

 

(b)

Entry Date

 

 

(c)

Eligibility Requirements

 

2.06.

Employees Excluded From Participation

 

ARTICLE III.  CONTRIBUTIONS

 

3.01.

Discretionary Contributions

 

(a)

In general

 

(b)

Contribution date

 

(c)

Miscellaneous rules

3.02.

Salary Deferral Election

3.03.

Salary Deferral Agreement

 

(a)

In general

 

(b)

Governing rules

 

(c)

Time of Payment of Salary Deferral Contributions

3.04.

Salary Deferral Agreement Limitations

 

(a)

Employer’s right to amend the Salary Deferral Agreement

 

(b)

Determining taxable income

3.05.

Actual Deferral Percentage Test

 

(a)

In general

 

(b)

Definition of Actual Deferral Percentage

 

(c)

Prior Year Testing or Current Year Testing Data

 

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(d)

Actual Deferral Percentage Test Safe Harbor Contributions

 

(e)

Two or more cash or deferred plans

 

(f)

Special rule for Highly Compensated Participants

3.06.

Individual Limitation on Salary Deferral Contributions

 

(a)

Elective Deferrals or Salary Deferrals

 

(b)

Excess Deferrals or Excess Salary Deferrals

 

(c)

Date when Excess Deferrals are to be distributed

 

(d)

Designation of Excess Deferrals

 

(e)

Income

 

(f)

Lag period income

 

(g)

Coordination with Excess Contributions

 

(h)

Notification by Employee

3.07.

Matching Contributions

3.08.

Nondeductible Employee Contributions

 

(a)

In general

 

(b)

Recharacterization of Excess Contributions

3.09.

Actual Contribution Percentage Test

 

(a)

In general

 

(c)

Nondiscrimination Safe Harbor

3.10.

Limitation of Multiple Use of Alternate Limit

 

(a)

In general

 

(a)

In general

 

(b)

Aggregate Limit

3.11.

Qualified Nonelective and Matching Contributions

 

(a)

Allocation of Qualified Nonelective Contributions

 

(b)

Actual Deferral Percentage Test

 

(c)

Actual Contribution Percentage Test

 

(d)

Restrictions

 

(e)

Return of Excess Contributions

 

(f)

Employer Election

3.12.

Rollover Contributions and Plan-to-Plan Transfers

 

(a)

Rollovers

 

(b)

Plan-to-Plan Transfers

 

(c)

Rollover or Plan-to-Plan Transfer from Employer ESOP

3.13.

Return of Contributions

 

3.14.

Owner-Employee Provisions

 

3.15.

Other Nondiscrimination Requirements

 

3.16.

Qualified Military Service

 

3.17.

Catch-up Contributions

 

ARTICLE IV. PARTICIPANT ACCOUNTS AND ALLOCATIONS

 

4.01.

Establishment of Accounts

 

(a)

Employer Matching Account

 

(b)

Employer Discretionary Account

 

(c)

Nondeductible Employee Account

 

(d)

Unrelated Rollover Account

 

(e)

Related Rollover Account Account

 

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(f)

Plan-to-Plan Transfer Account

 

(g)

Salary Deferral Account

 

(h)

Qualified Matching Contribution Account

 

(i)

Qualified Nonelective Contribution Account

 

(j)

Forfeiture Account

 

(k)

Predecessor Employee Account

 

(l)

Predecessor Employer Account

 

(m)

Employer Account

 

(n)

Rollover Account

4.02.

Accounting Procedure for Allocations

 

(a)

In general

 

(b).

Securities

 

(c)

Insurance Contracts

4.03.

Allocation of Participant Contributions

 

(a)

Nondeductible Employee Contributions

 

(b)

Rollover Contributions

 

(c)

Plan-to-Plan Transfers

4.04.

Allocation of Net Income or Net Loss

4.05.

Ascertainment of Net Income and Net Loss

 

4.06.

Allocation of Employer Contributions and Forfeitures

 

(a)

Discretionary Contributions:  Allocation in Proportion to Compensation

 

(b)

Discretionary Contribution:  Integrated Allocation

 

(c)

Discretionary Contribution:  Allocation Based on Cross Testing

 

(d)

Salary Deferral Contributions

 

(e)

Matching Contributions

 

(f)

Forfeitures

 

(g)

Additional Allocations

ARTICLE V. LIMITATIONS ON ALLOCATIONS

5.01.

Participants Covered by this Plan Only

 

(a)

In general

 

(b)

Calculation of Maximum Permissible Amount

5.02.

More than One Plan

 

 

(a)

Two or more defined contribution plans

 

 

(b)

Defined benefit plans

 

 

(c)

Defined benefit plan fraction

 

 

(d)

Defined contribution plan fraction

 

 

(e)

Top-heavy rule

 

 

(f)

Limiting Annual Additions

 

 

(g)

Other limitations

 

 

(h)

Rules shall comply with Code section 415

 

ARTICLE VI. VESTING

 

6.01.

Employer Account Vesting Schedule

 

 

6.02.

Vesting Computation Method

 

 

(a)

In general

 

 

(b)

Change In Computation Period

 

6.03.

Years of Service

 

 

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6.04.

Amendment of Vesting Schedule

 

 

(a)

In general

 

 

(b)

Election Period

 

6.05.

Other Accounts Fully Vested

 

ARTICLE VII. BENEFITS AND DISTRIBUTIONS

 

7.01.

Application of Provisions

 

 

7.02.

Normal Retirement Benefits

 

 

7.03.

Termination Benefit Prior to Normal Retirement

 

 

(a)

General Rule

 

 

(b)

Miscellaneous provisions

 

7.04.

Disability Benefits

 

 

(a)

In general

 

 

(b)

Determination of Disability

 

7.05.

Death Benefits

 

 

(a)

Full Vesting

 

 

(b)

Payable to Beneficiary

 

 

(c)

Death after distribution of balance

 

 

(d)

Death before distribution of balance

 

 

(e)

Calculation of payments

 

 

(f)

Payment to a child of the Participant

 

 

(g)

Miscellaneous

 

7.06.

Certification of Separation from Service

 

7.07.

Commencement of Benefits

 

 

(a)

In general

 

 

(b)

Required minimum distributions

 

 

(c)

Provisions take precedence

 

 

(d)

Distribution commencement date

 

 

(e)

Other rules

 

 

(f)

Distributions Prior to 30 Day Period

7.08.

Settlement Options

 

(a)

In general

 

(b)

Plan Administrator Options

 

(c)

Frequency of payments

7.09.

Transitional Rules

 

(a)

In general

 

(b)

Distribution upon death

 

(c)

Method of distribution

 

(d)

Method of distribution must satisfy Code section 401(a)(9)

7.10.

Presumption of Mental Competency

7.11.

Financial Hardship Withdrawals

 

(a)

In general

 

(b)

Deemed Financial Hardships

 

(c)

Other Financial Hardships

 

(d)

Other available resources

 

(e)

Withdrawal deemed necessary to satisfy financial need

 

(f)

Limitation on Amount Withdrawn

 

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7.12.

Attainment of Age 59-1/2

 

 

7.13.

Other Withdrawals

 

 

(a)(1)

Nondeductible Employee Account

 

 

(a)(2)

Rollover Account

 

 

(b)

Restrictions on Certain Contributions

 

 

(c)

Matching and Discretionary Accounts

 

7.14.

Denial of a Request for Benefits

 

 

(a)

Content of a denial

 

 

(b)

Review procedure

 

7.15.

Disputed Benefits

 

7.16.

Disputed Claims

 

 

7.17.

Qualified Domestic Relations Orders

 

 

(a)

In general

 

(b)

Withdrawal provisions

 

(c)

Distribution provisions

 

(d)

Beneficiary Designation

 

(e)

Other restrictions

 

(f)

Payment commencement date

 

(g)

Alternate payee’s death

 

(h)

Miscellaneous

7.18.

Designation of Beneficiary

 

 

(a)

Spouse is Beneficiary

 

(b)

Beneficiary designation.

 

(c)

Alternate payee

7.19.

Location of Beneficiary or Participant Unknown

 

7.20.

Distribution for Minor Beneficiary

 

7.21.

Rollover Distributions.

 

(a)

Direct Rollovers

 

 

(b)

Definitions

 

ARTICLE VIII. JOINT AND SURVIVOR ANNUITY REQUIREMENTS

8.01.

Provisions of this Article take Precedence

 

8.02.

Qualified Joint and Survivor Annuity

 

8.03.

Definitions

 

(a)

Annuity Starting Date

 

(b)

Earliest Retirement Age

 

(c)

Election Period

 

(d)

Pre-age 35 Waiver

 

(e)

Qualified Joint and Survivor Annuity

 

(f)

Qualified Election

8.04.

Qualified Pre-retirement Survivor Annuity

8.05.

Notice Requirements

 

(a)

Qualified Joint and Survivor Annuity

 

(b)

Qualified Pre-retirement Survivor Annuity

8.06.

Transitional Rules

 

(a)

In general

 

(b)

Right to Automatic Joint and Survivor Annuity

 

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(c)

Election of early survivor annuity

 

(d)

Qualified Early Retirement Age

8.07.

Account Balance Not Greater than $5,000

8.08.

Consent Required for Certain Distributions Exceeding $5,000

ARTICLE IX. TOP HEAVY PLAN

9.01.

Definitions

 

(a)

Determination Date

 

(b)

Permissive Aggregation Group

 

(c)

Present Value of Accrued Benefits

 

(d)

Required Aggregation Group

 

(e)

Top-Heavy Plan Year

 

(f)

Top-Heavy Ratio

9.02.

Determination of Top-Heavy and Super Top-Heavy Status

 

(a)

Top-Heavy Status

 

(b)

Super Top-Heavy Status

9.03.

Special Vesting Requirements

9.04.

Special Minimum Allocation Requirements

 

(a)

In general

 

(b)

Special Rules

9.05.

Special Multiple Plan Rules

 

(a)

General rule

 

(b)

Employees participating in only the defined benefit plan

 

(c)

Employees participating in both plans

 

9.06.

Change from Top-Heavy Plan to Non Top-Heavy Plan

 

9.07.

Safe Harbor Contribution Plan

 

 

ARTICLE X. PLAN ADMINISTRATOR

 

 

10.01.

Plan Administrator

 

 

10.02.

Signatures

 

 

10.03.

General Powers and Authority of Plan Administrator

 

 

(a)

Plan Administrator is a Fiduciary

 

 

(b)

Powers of Plan Administrator

 

10.04.

Uniform Administration

 

10.05.

Finality of Decision

 

 

10.06.

Self Interest of Participant

 

 

10.07.

Plan Records

 

 

10.08.

Bonding and Liability of Plan Administrator

 

 

10.09.

Reporting and Disclosure

 

 

10.10.

Power and Responsibilities of the Employer

 

 

(a)

Duties

 

 

(b)

Power to appoint Trustee and Plan Administrator

 

 

(c)

Funding policy method

 

 

(d)

Service of legal process

 

 

(e)

Performance reviews

 

10.11.

Payment of Expenses

 

ARTICLE XI. PARTICIPANT DIRECTION OF INVESTMENTS

 

 

11.01.

Participant-Directed Investment Account

 

 

 

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11.02.

Investment Options.

 

11.03.

Investment Direction

 

(a)

Investment election

 

(b)

Absence of affirmative direction

 

(c)

Change of investment election

 

(d)

Transfers between options

 

(e)

Oral instructions

 

(f)

Other restrictions

11.04.

Investment Direction – Employer Securities

 

(a)

Definitions

 

(b)

Investment Election – Employer Securities

 

(c)

Proxy Voting – Employer Securities

 

(d)

Tender Offers – Employer Securities

ARTICLE XII. PARTICIPANT LOANS

12.01.

Availability of Loans

 

12.02.

Loan Policy

 

12.03.

Loan Documents

 

ARTICLE XIII. ADOPTION, TERMINATION AND RELATED MATTERS

 

13.01.

Adoption Agreement

 

13.02.

Right to Amend Reserved

 

(a)

Right to Amend

 

(b)

No Protected Benefit may be eliminated

13.03.

Limitations on Employer’s Right to Amend

13.04.

Right to Terminate

 

13.05.

Suspension of Contributions

 

13.06.

Merger, Partial Merger, Consolidation, and Transfer of Assets

 

13.07.

Partial Termination

 

13.08.

Liquidation of the Trust Fund

 

(a)

Continuing the Trust

 

(b)

Liquidating the Trust

13.09.

Manner of Distribution

13.10.

No Reversion to Employers

 

(a)

Deductibility

 

(b)

Mistake of Fact

 

(c)

Initial Qualification

 

(d)

Other Allowable Provisions

13.11.

Determination of Returned Amount

ARTICLE XIV. PARTICIPATING EMPLOYERS

 

14.01.

Adoption By Other Employers

 

14.02.

Requirements of Participating Employers

 

(a)

Trustee

 

(b)

Trust Funds

 

(c)

Transfers

 

(d)

Participant rules

 

(e)

Expenses

14.03.

Designation of Agent

 

ix

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14.04.

Employee Transfers

 

 

14.05.

Participating Employer’s Contribution

 

 

(a)

In general

 

 

(b)

Contracts

 

14.06.

Amendment

 

14.07.

Discontinuance of Participation

 

 

14.08.

Plan Administrator’s Authority

 

 

14.09.

Participating Employer’s Contribution for Affiliate

 

 

ARTICLE XV. MISCELLANEOUS PROVISIONS

 

 

15.01.

Named Fiduciaries and Allocation of Responsibility

 

 

15.02.

Nonalienability of Benefits

 

 

15.03.

Rights to Trust Assets

 

 

15.04.

No Diversion of Trust Fund

 

 

15.05.

Name and Address Change

 

 

15.06.

Plan Not an Employment Contract

 

 

15.07.

Controlling Law

 

 

15.08.

Severability

 

15.09.

Legal Action

 

15.10.

Employer’s and Trustee’s Protective Clause

 

15.11.

Insurer’s Protective Clause

 

15.12.

Receipt and Release for Payments

 

15.13.

Action by the Employer

 

15.14.

Headings for Convenience

 

15.15.

Words Used

 

15.16.

Reference to Code or ERISA Sections

 

15.17.

Counterparts

 

APPENDIX A

 

APPENDIX A

TOP HEAVY PLAN

 

9.01.

Definitions

 

 

(a)

Determination Date

 

 

(b)

Permissive Aggregation Group

 

 

(c)

Present Value of Accrued Benefits

 

 

(d)

Required Aggregation Group

 

 

(e)

Top-Heavy Plan Year

 

 

(f)

Top-Heavy Ratio

 

9.02.

Determination of Top-Heavy and Super Top-Heavy Status

 

 

(a)

Top-Heavy Status

 

 

(b)

Super Top-Heavy Status

 

9.03.

Special Vesting Requirements

 

9.04.

Special Minimum Allocation Requirements

 

 

(a)

In general

 

 

(b)

Special Rules

 

9.05.

Special Multiple Plan Rules

 

 

(a)

General rule

 

 

(b)

Employees participating in only the defined benefit plan

 

 

(c)

Employees participating in both plans

 

9.06.

Change from Top-Heavy Plan to Non Top-Heavy Plan

 

 

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ARTICLE I.  DEFINITIONS.

 

The terms in this Plan shall have the meaning set forth in Article I, unless
another meaning is clearly required:

 

1.01.       Accounts mean all of the following accounts which may be maintained
for a Participant under the Plan: Salary Deferral Account, Nondeductible
Employee Account, Rollover Account (subdivided into a Unrelated Rollover Account
and a Related Rollover Account), Plan-to-Plan Transfer Account, Employer
Discretionary Account (or Discretionary Account), Employer Matching Account (or
Matching Account), Qualified Matching Contributions Account, Qualified
Nonelective Contributions Account, Predecessor Employee Account and Predecessor
Employer Account.  The Accounts, maintained for each Participant, shall
constitute a subtrust, even if the investments of a Participant’s Account(s) are
commingled with the investments of another Participant’s Account(s). 
Accordingly, the Participant Account(s) of one Participant shall not be liable
for liabilities incurred in the Participant Account(s) of another Participant. 
Accounts hereunder are for accounting purposes only and the segregation of Plan
assets shall not be required.  The Plan Administrator may establish such other
Accounts as may be necessary to reflect the interest of any Participant, Former
Participant, Beneficiary or alternate payee (as defined in Code section 414(p))
in the Plan.

 

1.02.       Adoption Agreement means the instrument signed by the Employer to
adopt this Plan.

 

1.03.       Affiliate 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; and a trade or business (whether or not incorporated)
which is under common control (as defined in Code section 414(c)) with the
Employer; 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 any other entity required to be aggregated with the Employer
pursuant to Regulations under Code section 414(o).

 

1.04.       Anniversary Date means the last day of the Plan Year.

 

1.05.       Annual Additions means:

 

(a)           In general.  The sum of the following amounts allocated to a
Participant’s Accounts for a Limitation Year:

 

(1) Employer Contributions (including Salary Deferral Contributions, Employer
Discretionary Contributions, and Employer Matching Contributions);

 

(2) Forfeitures;

 

(3) Nondeductible Employee Contributions; and

 

(4) except that for Limitation Years beginning prior to January 1, 1987, “the
lesser of (A) Nondeductible Employee Contributions in excess of six percent (6%)
of the Employee’s 415(c) Compensation for the Limitation Year, or (B) one-half
of the

 

1

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Employee’s Nondeductible Employee Contributions,” shall be substituted for
subparagraph 1.05(a)(3).

 

(b)            Medical accounts.  Amounts allocated, after March 31, 1984, to an
individual medical account, as defined in Code section 415(l)(2), which is part
of a pension or annuity plan maintained by the Employer, are treated as Annual
Additions to a defined contribution plan. Also, amounts derived from
contributions paid or accrued after December 31, 1985, in taxable years ending
after such date, which are attributable to post-retirement medical benefits
allocated to the separate account of a Key Employee (as defined in Code section
416(i)(1)), maintained by the Employer, are treated as Annual Additions to a
defined contribution plan.

 

1.06.       Authorized 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.

 

1.07.       Annual Limitation, see Section 1.11(a).

 

1.08.       Beneficiary means an individual, or trustee of a trust for the
benefit of an individual, or an estate, as may be determined in connection with
the provisions of the Plan.

 

1.09.       Break-in-Service shall have one of the following meanings, as set
forth in the Adoption Agreement:

 

(a)            1,000 Hours of Service Method means the applicable computation
period during which an Employee has not completed more than 500 Hours of
Service.  Further, solely for the purposes of determining whether a Participant
has incurred a one year Break-in-Service, Hours of Service shall be recognized
for “authorized leaves of absence” and “maternity and paternity leaves of
absence” as described in Plan Section 1.33(e).  Years of Service and one-year
Breaks-in-Service shall be measured on the same computation period.

 

(b)            Elapsed Time Methodmeans the applicable computation period of 12
consecutive months during which an Employee is not employed by the Employer due
to a Severance from Employment.  Further, solely for the purposes of determining
whether a Participant has incurred a one-year Break-in-Service, Hours of Service
shall be recognized for “authorized leaves of absence” and “maternity and
paternity leaves of absence.”  Years of Service and one-year Breaks-in-Service
shall be measured on the same computation period.  A Break-in-Service is a
period of severance of at least 12 consecutive months.  A period of severance is
a continuous period of time during which the Employee is not credited with at
least one Hour of Service. Such period begins on the date the Employee retires,
quits, or is discharged, or if earlier, the 12 month anniversary of the date on
which the Employee was otherwise first absent from Service.

 

In the case of an individual who is absent from work for maternity or paternity
reasons, the 12 consecutive month period beginning on the first anniversary of
the first date of such absence shall not constitute a Break-in-Service.  For
purposes of this Section 1.09(b), an absence from work for maternity or
paternity reasons means an absence by reason of the:

 

2

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(1) pregnancy of the individual; (2) birth of a child of the individual; (3)
placement of a child with the individual in connection with the adoption of such
child by such individual; or (4) care of such child for a period beginning
immediately following such birth or placement.

 

Notwithstanding any provision of this Plan to the contrary, contributions,
benefits and Service credit with respect to qualified military service will be
provided in accordance with Code section 414(u).

 

1.09(A)       Catch-up Contributions means contributions made by a Participant,
who has attained age 50 before the close of the Plan Year, in accordance with,
and subject to the limitations of, section 414(v) of the Code.

 

1.10.       Code means the Internal Revenue Code of 1986, as it may be amended
from time to time.

 

1.11.       Compensation.

 

(a)           In general.  Compensation, effective for Plan Years beginning on
or after January 1, 2002, has several different definitions in order to comply
with the Code, and such definitions are set forth below.  All definitions are
subject to the following provisions:

 

In addition to other applicable limitations set forth in the Plan, and
notwithstanding any other provision of the Plan to the contrary, for Plan Years
beginning on or after January 1, 2002, the annual Compensation, of each
Employee, taken into account under the Plan shall not exceed the EGTRRA annual
compensation limit.  The EGTRRA annual compensation limit shall be $200,000, as
adjusted by the Commissioner 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 12 months, over which
Compensation is determined (determination period) beginning in such calendar
year.  If a determination period consists of fewer than 12 months, the EGTRRA
annual compensation limit shall be multiplied by a fraction, the numerator of
which is the number of months in the determination period, and the denominator
of which is 12.

 

For Plan Years beginning on or after January 1, 2002, any reference in the Plan
to the limitation under Code section 401(a)(17) shall mean the EGTRRA annual
compensation limit set forth in this provision.

 

If Compensation for any prior determination period is taken into account in
determining an Employee’s benefits accruing in the current Plan Year, the
Compensation for that prior determination period shall be subject to the OBRA
’93 annual compensation limit in effect for that prior determination period. For
this purpose, for determination periods beginning before the first day of the
first Plan Year beginning on or after January 1, 2002, the OBRA ’93 annual
compensation limit shall be $150,000.

 

(1) Annual Limitation.  For Plan Years beginning on or after January 1, 1994 and
prior to January 1, 2002, a Participant’s annual Compensation that may be taken
into account

 

3

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for all purposes under this Plan shall not exceed the OBRA ’93 annual
compensation limit.  The OBRA ’93 annual compensation limit shall be $150,000,
as adjusted by the Commissioner for increases in the cost of living in
accordance with Code section 401(a)(17)(B).  Compensation in excess of the OBRA
’93 limit shall be disregarded.

 

For Plan Years beginning prior to January 1, 1994, a Participant’s annual
Compensation that may be taken into account for all purposes under this Plan is
subject to the Annual Limitation.  Annual Limitation means $200,000, as adjusted
annually by the Commissioner.  Compensation in excess of the Annual Limitation
shall be disregarded.

 

Contributions allocated or benefits accrued under this Plan for Plan Years prior
to January 1, 1989, are not subject to the Annual Limitation, except for
Top-Heavy Plan Years. For Top-Heavy Plan Years prior to January 1, 1989, the
Annual Limitation is $200,000.

 

(2) De minimis accrued Compensation.  An Employer may include in all definitions
of Compensation amounts earned but not paid in a year because of the timing of
pay periods and pay days if these amounts are paid during the first few weeks of
the next year, the amounts are included on a uniform and consistent basis with
respect to all similarly situated employees, and no Compensation is included in
more than one limitation period.  No formal election is required to include the
accrued Compensation permitted under this de minimis rule.

 

(b)           415(c) Compensation means:

 

(1) The Participant’s wages, salaries, fees for professional services and other
amounts received (without regard to whether or not an amount is paid in cash)
for personal services actually rendered in the course of employment with the
Employer to the extent that the amounts are includible in gross income
(including, but not limited to, commissions paid to salesmen, compensation for
services on the basis of a percentage of profits, commissions on insurance
premiums, tips, bonuses, fringe benefits, and reimbursements, or other expense
allowances under a nonaccountable plan (as described in section 1.62-2(c) of the
Treasury Regulations)).

 

(2) In the case of a Participant who is self-employed, i.e., is an employee
within the meaning of Code section 401(c)(1) and the Regulations thereunder, the
Participant’s Earned Income.

 

(3) Amounts described in Code section 104(a), but only to the extent that these
amounts are includible in the gross income of the Employee.

 

(4) Amounts paid or reimbursed by the Employer for moving expenses incurred by
an Employee, but only to the extent that these amounts are not deductible by the
Employee under Code section 217.

 

4

--------------------------------------------------------------------------------

 

(5) The value of a non-qualified stock option granted to an Employee by the
Employer, but only to the extent that the value of the option is includible in
the gross income of the Employee for the taxable year in which granted.

 

(6) The amount includible in the gross income of an Employee upon making the
election described in Code section 83(b).

 

(7) Compensation includes foreign earned income (as defined in Code section
911(b)), whether or not excludible from gross income under Code section 911.

 

(8) For Limitation Years beginning after December 31, 1991, for purposes of
applying the limitations of this provision, Compensation for a Limitation Year
is the Compensation actually paid or made available during such Limitation Year.

 

(9)  For Limitation Years beginning after December 31, 1997, the 415(c)
Compensation definition shall include any elective deferrals (as defined in Code
section 402(g)(3)) paid or made available during such Limitation Year, and any
amount which is contributed or deferred by the Employer at the election of the
Employee and which is not includible in the gross income of the Employee by
reason of Code section 125 or 457.

 

(10)  For Limitation Years beginning on or after January 1, 2001, 415(c)
Compensation shall include elective amounts that are not includible in the gross
income of the Employee by reason of Code section 132(f)(4).

 

(11)  415(c) Compensation does not include items such as:

 

(A) Contributions made by the Employer to a Plan of deferred compensation to the
extent that, before the application of the Code section 415 limitations to that
Plan, the contributions are not includible in the gross income of the Employee
for the taxable year in which contributed, including Salary Deferral
Contributions to this Plan.  In addition, Employer Contributions made on behalf
of an Employee to a Simplified Employee Pension Plan described in Code section
408(k) are not considered as compensation for the taxable year in which
contributed to the extent such contributions are deductible by the Employee
under Code section 219(b).  Additionally, any distributions from a plan of
deferred compensation are not considered as 415(c) Compensation, regardless of
whether such amounts are includible in the gross income of the employee when
distributed.  However, any amounts received by an Employee pursuant to an
unfunded non-qualified plan will be considered as 415(c) Compensation in the
year such amounts are includible in the gross income of the Employee.

 

(B) Amounts realized from the exercise of a non-qualified stock option, or when
restricted stock (or property) held by an Employee either becomes freely
transferable or is no longer subject to a substantial risk of forfeiture (as
described in Code section 83 and the regulations thereunder).

 

5

--------------------------------------------------------------------------------

 

(C) Amounts realized from the sale, exchange or other disposition of stock
acquired under a qualified stock option.

 

(D) Other amounts which receive special tax benefits, such as premiums for group
term life insurance (but only to the extent that the premiums are not includible
in the gross income of the Employee), or contributions made by the Employer
(whether or not under a salary reduction agreement) towards the purchase of an
annuity contract described in Code section 403(b) (whether or not the
contributions are actually excludible from the gross income of the Employee).

 

(12)  Alternative definitions of 415(c) Compensation.  In lieu of defining
415(c) Compensation as above, and if so specified in the Adoption Agreement, the
Plan may define 415(c) Compensation using one of the following definitions used
for employment tax purposes, as modified herein, except for Employees who are
self-employed within the meaning of Code section 401(c)(1).

 

For Limitation Years beginning after December 31, 1997, the 415(c) Compensation
definition shall include any elective deferral (as defined in Code section
402(g)(3)) paid or made available during such Limitation Year, and any amount
which is contributed or deferred by the Employer at the election of the Employee
and which is not includible in the gross income of the Employee by reason of
Code section 125 or 457.  For Limitation Years beginning on or after January 1,
2001, 415(c) Compensation shall include elective amounts that are not includible
in the gross income of the Employee by reason of Code section 132(f)(4).

 

(A) Wages, Tips and Other Compensation Box on Form W-2 (Code sections 6041 and
6051 wages).  415(c) Compensation is defined as wages within the meaning of Code
section 3401(a) and all other payments of compensation to an Employee by the
Employer (in the course of the Employer’s trade or business) for which the
Employer is required to furnish the Employee a written statement under Code
sections 6041(d) and 6051(a)(3), except the following amounts shall be excluded
unless otherwise stated in the Adoption Agreement: amounts paid or reimbursed by
the Employer for moving expenses incurred by an Employee, but only to the extent
that at the time of the payment it is reasonable to believe that these amounts
are deductible by the Employee under Code section 217.  415(c) Compensation
under this alternative definition must be determined without regard to any rules
under Code section 3401(a) that limit the remuneration included in wages based
on the nature or location of the employment or the services performed (such as
the exception for agricultural labor in Code section 3401(a)(2)).

 

(B) Code section 3401(a) wages.  415(c) Compensation is defined as wages within
the meaning of Code section 3401(a) for purposes of income tax withholding at
the source but determined without regard to any rules that limit the
remuneration included in wages based on the nature or location of the

 

6

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employment or the services performed (such as the exception for agricultural
labor in Code section 3401(a)(2)).

 

(C) Section 3121 wages.  415(c) Compensation is defined as wages within the
meaning of Code section 3121(a), for purposes of calculating Social Security
taxes, but determined without regard to the wage base limitation in Code section
3121(a)(1), the limitations on the exclusions from wages in Code section
3121(a)(5)(C) and (D) for elective contributions and payments by reason of
salary deferral agreements, the special rules in Code section 3121(v), any rules
that limit covered employment based on the type or location of an Employee’s
Employer, and any rules that limit remuneration included in wages based on
familial relationship or based on the nature or location of the employment or
the services (such as the exceptions to the definition of employment in Code
section 3121(b)(1) through (20)).

 

(c)          414(q) Compensation means for Limitation Years beginning before
January 1, 1998, 415(c) Compensation without regard to Code sections 125,
402(e)(3), and 402(h)(1)(B) and, in the case of Employer contributions made
pursuant to a salary deferral agreement, without regard to Code section 403(b). 
414(q) Compensation includes elective or salary reduction contributions to a
cafeteria plan, a cash or deferred arrangement or a tax-sheltered annuity,
including Salary Deferral Contributions to this Plan.

 

For Limitation Years beginning after December 31, 1997, 414(q) Compensation
means 415(c) Compensation.

 

(d)          414(s) Compensation for purposes of nondiscrimination testing
hereunder, means compensation as defined in Code section 414(s) and the Treasury
regulations thereunder, as elected by the Employer from time to time from the
various options available under such regulations, and pursuant to any rules and
requirements as may be set forth in such regulations.  To the extent permissible
under such regulations, the Employer may use different definitions of 414(s)
Compensation (i) for different nondiscrimination tests in the same Plan Year,
and (ii) for the same nondiscrimination test from year to year.  At the
discretion of the Employer, 414(s) Compensation may be limited to that
compensation earned while an Employee is a Participant, as permitted by law.

 

1.12.       Disability means the inability, supported by medical evidence, to
engage in substantial gainful activity by reason of any medically determinable
physical or mental impairment that can be expected to result in death or which
has lasted or can be expected to last for a continuous period of not less than
12 months.

 

Unless specified otherwise in the Adoption Agreement, for a Participant to
establish Disability, such Participant must furnish to the Plan Administrator
evidence that the federal Social Security Administration has determined that the
Participant is eligible to receive total disability benefits under the federal
Social Security Act.

 

7

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1.13.       Discretionary Contributions means contributions which the Employer
makes to the Plan for the benefit of Participants, which is not a Salary
Deferral or a Matching Contribution. All Discretionary Contributions for a Plan
Year shall be contributed to the Trustee by the date prescribed by law
(including extension thereof) for filing the Employer’s federal income tax
return for its taxable year ending with or within such Plan Year.

 

1.14.       Early Retirement Age shall be age 55, unless otherwise specified in
the Adoption Agreement, and means the earliest date on which a Participant who
has Separated from Service with the Employer can elect to receive Normal
Retirement Benefits.

 

1.15.       Earned Income means the net earnings from self-employment in the
trade or business with respect to which the Plan is established, for which
personal services of the individual are a material income-producing factor. Net
earnings shall be determined without regard to items not included in gross
income and the deductions allocable to such items. Net earnings are reduced by
contributions by the Employer to a qualified plan to the extent deductible under
Code section 404.  Net earnings shall be determined with regard to the deduction
allowed to the taxpayer by Code section 164(f) for taxable years beginning after
December 31, 1989.

 

1.16.       Effective Date means the date as of which the Plan is first made
effective with respect to an Employer (not earlier than the first day of the
first Plan Year), and which is set forth in the Adoption Agreement. For
Employers who adopt this Plan as an amendment and restatement of a prior plan,
such amendment and restatement shall be effective as provided for in the
Adoption Agreement.

 

1.17.       Eligible Employee means an Employee who at any time has met the
requirements of the Plan for participation in the Plan.

 

1.18.       Employee means any person who is employed by the Employer or
affiliated Employer, but excludes any person who is: (1) an independent
contractor; or (2) any individual who performs service for the Employer who has
been classified by the Employer as an independent contractor, a subcontractor or
in any other capacity not within the traditional common-law meaning of the term
“Employee,” even if such individual is later re-classified either by the
Internal Revenue Service or any court of competent jurisdiction as a common-law
Employee.  The term Employee shall include any Leased Employee deemed to be
Employee of the Employer or affiliated Employer as provided in Code section
414(n) or (o) except to the extent such Leased Employees may be excluded under
the provisions of Section 1.37, in any event, however, such Leased Employees
shall only be included for the purposes of Code section 410(b).

 

1.19.       Employer means any corporation, professional corporation,
professional association, partnership, S corporation, sole proprietorship or
unincorporated business which shall adopt this Plan and any successor
organization which may succeed to its business and which may elect to continue
the Plan. In the case of a group of employers which are Affiliates, all such
employers shall be considered a single Employer for purposes of establishing the
Maximum Permissible Amount.  “Employer” shall include Participating Employers
(as defined in Section 14.01) unless the context requires otherwise.

 

8

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1.20.       Employer Account means the combined individual Accounts of a
Participant consisting of any Matching Contributions and any Discretionary
Contributions made to the Plan on behalf of the Participant, including income,
expenses, gains, losses, and Forfeitures attributable thereto.

 

1.21.       Entry Date means the date or dates specified in the Adoption
Agreement; or, in the case of a business which becomes an Employer because of an
acquisition by the Plan Sponsor, the Plan Administrator, in his sole discretion,
may set an additional Entry Date so that the eligible Employees of said business
may become Participants in the Plan in accordance with Section 2.05.

 

1.22.       ERISA means the Employee Retirement Income Security Act of 1974, as
it may be amended from time to time.

 

1.23.       Family Member means, with respect to an affected Participant, such
Participant’s Spouse, such Participant’s lineal descendants and ascendants and
their Spouses, all as described in Code section 414(q)(6)(B) prior to its repeal
in the Small Business Job Protection Act of 1996, which repeal was effective for
Plan Years beginning after December 31, 1996.

 

1.24.       Fiduciary means any person who (a) exercises any discretionary
authority or discretionary control respecting the management of the Plan or
exercises any authority or control respecting management or the disposition of
its assets, (b) renders investment advice for a fee or other compensation,
direct or indirect, with respect to any monies or other property of the Plan or
has any authority or responsibility to do so, or (c) has any discretionary
authority or discretionary responsibility in the administration of the Plan,
including, but not limited to, the Trustee, the Employer and its representative
body, and the Plan Administrator.

 

1.25.       Five Percent Owner means any person who owns (or is considered as
owning within the meaning of Code section 318) more than five percent (5%) of
the outstanding stock of the Employer or stock possessing more than five percent
(5%) of the total combined voting power of all stock of the Employer, or in the
case of an unincorporated business, any person who owns more than five percent
(5%) of the capital or profits interest in the Employer. In determining the
percentage of ownership hereunder, employers that would otherwise be aggregated
under Code section 414(b), (c), or (m) shall be treated as separate employers.

 

1.26.       Forfeiture means that portion of a Participant’s Employer Account
that is not vested, and occurs on the earlier of:

 

(a)           the distribution of a Former Participant’s Vested Balance; or

 

(b)                                  the last day of the Plan Year in which the
Participant incurs five (5) consecutive one-year Breaks-in-Service.

 

Furthermore, for purposes of paragraph (a) above, in the case of a Participant
Separated from Service whose Vested Balance is zero, said Participant shall be
deemed to have received a distribution of his Vested Balance upon his Severance
from Employment.  Restoration of such amounts shall occur pursuant to Section
7.03(b)(4).  In addition, the term Forfeiture shall also include amounts deemed
to be Forfeitures pursuant to any other provision of this Plan.

 

9

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Such nonvested amounts and such other amounts treated as forfeited shall be
Forfeitures and shall be treated in accordance with Section 7.03(a).

 

1.27.       414(q) Compensation, see Section 1.11(c).

 

1.28.       414(s) Compensation, see Section 1.11(d).

 

1.29.       415(c) Compensation, see Section  1.11(b).

 

1.30.       Highly Compensated Employee effective January 1, 1997, means an
Employee described in Code section 414(q) and the Regulations thereunder, and
generally means an Employee who performed services for the Employer during the
“determination year” and is in one or more of the following groups:

 

(a)           Employees who at any time during the determination year or the
look-back year were Five Percent Owners.

 

(b)           Employees who received 414(q) Compensation during the look-back
year in excess of $80,000 (as adjusted at the same time and in the same manner
as under Code section 415(d), except that the base period is the calendar
quarter ending September 30, 1996).

 

(c)           If so specified in the Adoption Agreement, at the Employer’s
election, Employees considered in Section 1.30(b) above may be limited to
Employees in the Top-Paid Group during the look-back year.

 

(d)           For purposes of this Section 1.30 the “determination year” shall
be the Plan Year for which testing is being performed, and the “look-back year”
shall be the immediately preceding twelve-month period.  The Employer may make a
calendar year data election, under which election the look-back year shall be
the calendar year beginning with or within the look-back year.  Pursuant to
Notice 97-45, the calendar year data election may not be used to determine
whether an Employee is a Highly Compensated Employee under Section 1.30(a)
above.

 

(e)           A Top-Paid Group election under Section 1.30(c) and a calendar
year data election under Section 1.30(d) must be applied consistently to the
determination year of all plans of the Employer, except that the consistency
requirement will not apply to determination years beginning with or within the
1997 calendar year, and for determination years beginning on or after January 1,
1998, and before January 1, 2000, satisfaction of the consistency requirement is
determined without regard to any nonretirement plans of the Employer.

 

(f)            The dollar threshold amounts specified in 1.30(b) above shall be
adjusted at such time and in such manner as is provided in Code section 415(d)
and the applicable Treasury Regulations.

 

10

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(g)           In determining who is a Highly Compensated Employee, Employees who
are non-resident aliens and who received no earned income (within the meaning of
Code section 911(d)(2)) from the Employer constituting United States source
income within the meaning of Code section 861(a)(3) shall not be treated as
Employees.  Additionally, all Affiliated Employers shall be taken into account
as a single Employer and Leased Employees within the meaning of Code sections
414(n)(2) and 414(o)(2) shall be considered Employees unless such Leased
Employees are covered by a plan described in Code section 414(n)(5) and are not
covered in any qualified plan maintained by the Employer.  The exclusion of
Leased Employees for this purpose shall be applied on a uniform and consistent
basis for all of the Employer’s retirement plans.  Highly Compensated Former
Employees shall be treated as Highly Compensated Employees without regard to
whether they performed services during the “determination year.”

 

(h)           With respect to any Plan Year commencing prior to January 1, 1997,
Highly Compensated Employee means an active Employee if, at any time during the
Plan Year or the immediately preceding Plan Year, such active Employee:

 

(1)  was a Five Percent Owner of the Employer;

 

(2)  received 414(q) Compensation from the Employer in excess of $75,000 (as
adjusted by section 415(d) of the Code);

 

(3)  received 414(q) Compensation from the Employer in excess of $50,000 (as
adjusted by section 415(d) of the Code) and was a member of the Top Paid Group
of Employees during the same Plan Year; or

 

(4)  received 414(q) Compensation from the Employer in excess of fifty percent
(50%) of the limit in effect for such Plan Year under section 415(b)(1)(A) of
the Code and was at any time an officer of the Employer.

 

If an Employee is not described in (2), (3) or (4) above for the Plan Year
immediately preceding the Plan Year for which the determination of Highly
Compensated Employee is made, he shall not be considered a Highly Compensated
Employee for the determination year unless he is a member of the group
consisting of the 100 Employees paid the greatest Highly Compensated Employee
Compensation during the Plan Year for which the determination is being made.

 

1.31.       Highly Compensated Former Employee means a former Employee who
Separated from Service (or was deemed to have separated) prior to the
“determination year,” performed no Service for the Employer during the
determination year, and was a Highly Compensated Employee in the year of
Severance from Employment or in any “determination year” after attaining age
55.  Notwithstanding the foregoing, an Employee who Separated from Service prior
to 1987 will be treated as a Highly Compensated Former Employee only if during
the separation year (or year preceding the separation year) or any year after
the Employee attains age 55 (or the last year ending before the Employee’s 55th
birthday), the Employee either received 414(q) Compensation in excess of $50,000
or was a Five Percent Owner.  For purposes of this Section, “determination year”
shall be

 

11

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determined in accordance with Section 1.30.  Highly Compensated Former Employees
shall be treated as Highly Compensated Employees.  The method set forth in this
Section for determining who is a “Highly Compensated Former Employee” shall be
applied on a uniform and consistent basis for all purposes for which the 414(q)
Compensation definition is applicable.

 

1.32.       Highly Compensated Participant means any Highly Compensated Employee
who is a Participant.

 

1.33.       Hour of Service means:

 

(a)           In general.  Each hour for which an Employee is paid, or entitled
to payment, for the performance of duties for the Employer. These hours shall be
credited to the Employee for the Plan Year in which the duties are performed.

 

(b)           If no duties are performed.  Each hour for which an Employee is
paid, or entitled to payment, by the Employer on account of a period of time
which no duties are performed (irrespective of whether the employment
relationship has terminated) due to vacation, holiday, illness, incapacity
(including Disability), layoff, jury duty, military duty, or Authorized Absence.
No more than 501 Hours of Service shall be credited under this subsection (b)
for a single continuous period, which may extend over more than one computation
period or Plan Year. An Employee is not credited with any hours under this
paragraph (b) for any payment made under a plan maintained solely for complying
with applicable law for worker’s unemployment compensation, or disability
insurance; or for the purpose of reimbursing the Employee for medical or
medically related expenses. Hours under this subsection (b) shall be calculated
and credited pursuant to section 2530.200b-2 of the Department of Labor
Regulations which are incorporated herein by reference.

 

(c)           Back pay.  Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by the Employer. The same
hours shall not be credited both under subsection (a) or (b), as the case may
be, and under this subsection (c). These hours shall be credited to the Employee
for the Plan Year to which the award or agreement pertains, rather than the Plan
Year in which the award, agreement or payment is made.

 

(d)           Employment with Affiliates.  Hours of Service shall be credited
for employment with Affiliates of the Employer, and any other entity required to
be aggregated with the Employer pursuant to Code section 414(o), and for any
individual considered an Employee under Code section 414(n) and (o).

 

(e)           Special rules for determining a Break-in-Service.  For Plan Years
beginning after 1984, solely for purposes of determining whether a
Break-in-Service has occurred in a computation period, an Employee who is absent
from work for maternity or paternity reasons shall receive credit for the Hours
of Service which would otherwise have been credited to such Employee but for
such absence, or in any case in which such hours cannot be determined, eight (8)
Hours of Service per day of such absence. For purposes of this paragraph, an
absence for maternity or paternity reasons means an absence (1) by reason of the
pregnancy of the Employee (2) by reason of a birth of a child of the Employee,
(3) by reason of the placement of a child with the Employee in connection with
the adoption of such

 

12

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child by such Employee, or (4) for purposes of caring for such child for a
period beginning immediately following such birth or placement. The Hours of
Service credited under this paragraph shall be credited (1) in the computation
period in which the absence begins if such credit is necessary to prevent a
Break-in-Service in that period, or (2) in all other cases, in the following
computation period.

 

(f)            Active Military Duty.  Any Employee who is a member of the
military reserves of the United States, and who is called into duty, whether
voluntarily or involuntarily, shall be credited 8 Hours of Service for each day
he or she is on active duty, but no more than 40 Hours of Service shall be
credited for any seven day period starting on Sunday and ending on Saturday.

 

(g)           Equivalency methods.  Hours of Service shall be determined on the
basis of the actual hours for which an Employee is entitled to payment, unless
an equivalency method for counting Hours of Service has been elected in the
Adoption Agreement. The equivalency methods that may be so elected are:

 

(1)  Days Worked. For each day, an Employee shall be credited with 10 Hours of
Service if he is entitled to be credited for at least one (1) Hour of Service
for that day.

 

(2)  Weeks Worked.  For each week, an Employee shall be credited with 45 Hours
of Service if he is entitled to be credited for at least one (1) Hour of Service
for that week.

 

(3)  Semimonthly Payroll Periods Worked.  For each semimonthly payroll period,
an Employee shall be credited with 95 Hours of Service if he is entitled to be
credited for at least one (1) Hour of Service for that period.

 

(4)  Months Worked.  For each month, an Employee shall be credited with 190
Hours of Service if he is entitled to be credited for at least one (1) Hour of
Service for that month.

 

(5)  Earnings.  One of the following two methods may be used, as applicable.

 

(A) In the case of an Employee whose compensation is determined on the basis of
an hourly rate, he will be credited with the number of hours equal to his
Compensation from time to time during the computation period divided by the
Employee’s hourly rate as in effect at such times during the computation period,
or equal to his Compensation during the computation period divided by his lowest
hourly rate of compensation during that period, or by the lowest hourly rate of
compensation payable to an employee in the same, or a similar, job
classification, reasonably defined; and 870 hours credited under this method
shall be treated as equivalent to 1,000 Hours of Service, and 435 hours credited
under this method shall be treated as equivalent to 500 Hours of Service.

 

(B) In the case of an Employee whose compensation is determined on a basis other
than an hourly rate, and who is paid a fixed rate for a specified period of
time, an hourly rate shall be computed by dividing his lowest rate of

 

13

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compensation during the computation period for such period of time by the number
of hours regularly scheduled for the performance of duties during such period of
time, or in the case of an Employee without a regular work schedule, it shall be
calculated on a reasonable basis which reflects the average hours worked by the
Employee over a representative period of time; and the Employee shall be
credited with the number of hours equal to his Compensation during the
computation period divided by his lowest hourly rate so determined; and 750
hours credited under this method shall be treated as equivalent to 1,000 Hours
of Service, and 375 hours credited under this method shall be treated as
equivalent to 500 Hours of Service.

 

1.34.       Investment Manager means an entity that (a) has the power to manage,
acquire, or dispose of Plan assets and (b) acknowledges Fiduciary responsibility
to the Plan in writing.  Such an entity must be a person, firm, or corporation
registered as an investment adviser under the Investment Advisers Act of 1940, a
bank, or an insurance company.

 

1.35.       Joint and Survivor Annuity means an immediate annuity for the life
of the Participant with a survivor annuity for the life of the Spouse that is
not less than 50% (and not more than 100%) of the amount that is payable during
the joint lives of the Participant and Spouse and is the actuarial equivalent of
a single life annuity for the life of the Participant (also defined as the
amount of benefit which can be purchased with the Participant’s vested Account
Balance).  This annuity may not be terminated or reduced because of the
Surviving Spouse’s remarriage.  The percentage of the survivor annuity under the
Plan shall be 50% (unless a different percentage is elected by the Employer in
the Adoption Agreement).

 

1.36.       Key Employee, effective for Plan Years beginning on or after
December 31, 2001, 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
$130,000 (as adjusted under section 416(i)(1) of the Code for Plan Years
beginning after December 31, 2002), a 5-percent owner of the Employer, or a 1-
percent owner of the Employer having annual Compensation of more than $150,000.
For this purpose, annual Compensation means Compensation within the meaning of
section 415(c)(3) of the Code. The determination of who is a Key Employee will
be made in accordance with section 416(i)(1) of the Code and the applicable
regulations and other guidance of general applicability issued thereunder.

 

With respect to any Plan Year commencing prior to January 1, 2002, Key Employee,
means an Employee as defined in Code section 416(i)(1) and the regulations
thereunder.  Generally, any Employee or former Employee (as well as each of his
Beneficiaries) is considered a Key Employee if he, at any time during the Plan
Year that contains the Determination Date (as defined in Section 9.01(a)) or any
of the preceding four (4) Plan Years, has been included in one of the following
categories:

 

(a)           an officer of the Employer (as that term is defined within the
meaning of the regulations under Code section 416) having annual 414(q)
Compensation greater than 50% of the amount in effect under Code section
415(b)(1)(A) for any such Plan Year.

 

14

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(b)           one of the ten Employees having annual 414(q) Compensation from
the Employer for a Plan Year greater than the dollar limitation in effect under
Code section 415(c)(1)(A) for the calendar year in which such Plan Year ends and
owning (or considered as owning within the meaning of Code section 318) both
more than one-half percent (1/2%) interest and the largest interests in the
Employer.

 

(c)           a Five Percent (5%) Owner of the Employer or a One Percent (1%)
Owner of the Employer having an annual 414(q) Compensation from the Employer of
more than $150,000.  One Percent (1%) Owner means any person who owns (or is
considered as owning within the meaning of Code section 318) more than one
percent (1%) of the outstanding stock of the Employer or stock possessing more
than one percent (1%) of the total combined voting power of all stock of the
Employer or, in the case of an unincorporated business, any person who owns more
than one percent (1%) of the capital or profits interest in the Employer.  In
determining percentage ownership hereunder, employers that would otherwise be
aggregated under Code sections 414(b), (c), (m) and (o) shall be treated as
separate employers.  However, in determining whether an individual has “414(q)
Compensation” of more than $150,000, 414(q) Compensation from each employer
required to be aggregated under Code sections 414(b), (c), (m) and (o) shall be
taken into account.

 

1.37.       Leased Employee means any person (other than an Employee of the
recipient) who pursuant to an agreement between the recipient and any other
person (“leasing organization”) has performed services for the recipient (or for
the recipient and related persons determined in accordance with Code section
414(n)(6)) on a substantially full time basis for a period of at least one (1)
year, and such services  are performed under primary direction or control by the
recipient employer. Contributions or benefits provided a Leased Employee by the
leasing organization which are attributable to services performed for the
recipient employer shall be treated as provided by the recipient employer.  A
Leased Employee shall not be considered an Employee of the recipient if:

 

(a)           such employee is covered by a money purchase pension plan
providing:

 

(1)  a non-integrated employer contribution rate of at least ten percent (10%)
of compensation, as defined in Code section 415(c)(3);

 

(2)  immediate participation; and

 

(3)  full and immediate vesting.

 

(b)           Leased Employees do not constitute more than 20% of the
recipient’s non-highly compensated work force.

 

1.38.       Limitation Year means the Plan Year, unless otherwise specified in
the Adoption Agreement.

 

1.39.       Matching Contributions means contributions to the Plan made by the
Employer on behalf of a Participant that are contingent on the Employee’s having
entered into a Salary Deferral Election.

 

15

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1.40.       Maximum Permissible Amount, effective for Plan Years beginning after
December 31, 2001

 

(a)                                  means the lesser of:

 

(i)            $40,000, as adjusted for increases in the cost-of-living under
section 415(d) of the Code, or

 

(ii)           100 percent of the Participant’s Compensation, within the meaning
of section 415(c)(3) of the Code, for the Limitation Year.

 

The 415(c) Compensation limitation referred to in (ii) above shall not apply to
any contribution for medical benefits (within the meaning of Code section 401(h)
or 419A(f)(2)) which are otherwise treated as an Annual Addition under Code
section 415(l)(1) or 419A(d)(2).

 

If a short Limitation Year is created because of an amendment changing the
Limitation Year to a different 12-consecutive month period, the Maximum
Permissible Amount shall not exceed the defined contribution dollar limitation
in (i) above, multiplied by the following fraction:

 

NUMBER OF MONTHS IN THE SHORT LIMITATION YEAR

12

 

(b)                                  Maximum Permissible Amount, with respect to
any Plan Year commencing prior to January 1, 2002 means the lesser of:

 

(i)            $30,000, or such larger amount as may be determined by the
Commissioner of the Internal Revenue Service for the Limitation Year, or

 

(ii)           25% of the Participant’s Compensation for the Limitation Year.

 

The 415(c) Compensation limitation referred to in (ii) above shall not apply to
any contribution for medical benefits (within the meaning of Code section 401(h)
or 419A(f)(2)) which are otherwise treated as an Annual Addition under Code
section 415(l)(1) or 419A(d)(2).

 

If a short Limitation Year is created because of an amendment changing the
Limitation Year to a different 12-consecutive month period, the Maximum
Permissible Amount shall not exceed the defined contribution dollar limitation
in (i) above, multiplied by the following fraction:

 

NUMBER OF MONTHS IN THE SHORT LIMITATION YEAR

12

 

 

16

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1.41.       Net Profits means current and accumulated earnings of the Employer
before federal and state taxes and contributions to this or any other qualified
plan.

 

1.42.       Nondeductible Employee Account means the individual Account of a
Participant consisting of the Participant’s Nondeductible Employee Contributions
to the Plan as adjusted for income, expenses, gains, losses and distributions
attributable thereto.

 

1.43.       Nondeductible Employee Contribution means any Participant after-tax
contribution to the Plan other than a Rollover Contribution or a Plan-to-Plan
Transfer.

 

1.44.       Nonhighly Compensated Participant means any Participant who is not a
Highly Compensated Employee.

 

1.45.       Non-Key Employee means any Employee or former Employee (and his
Beneficiaries) who is not a Key Employee.

 

1.46.       Normal Retirement Age shall be 65 years of age unless otherwise
specified in the Adoption Agreement.

 

1.47.       Owner-Employee means a Self-employed Individual who is the sole
proprietor, in the case of a sole proprietorship. If the Employer is a
partnership, Owner-Employee means a Self-employed Individual who is a partner
owning more than ten percent (10%) of either the capital interest or profit
interest of the partnership. The term Owner-Employee, as used herein, shall be
consistent with Code section 401(c)(3).

 

1.48.       Participant means any Employee who has met the requirements of the
Plan to become a Participant and who continues to be a Participant in the Plan. 
A person shall cease to be a Participant when he has taken a distribution of his
Vested Balance or has died and his Beneficiary has taken a distribution of his
Vested Balance.  All Participants shall be further classified as follows:

 

(a)           Active Participant means an Employee who meets the requirements of
Sections 2.01 and 2.04(b), or the requirements of Section 2.04(e).

 

(b)           Inactive Participant means an Active Participant who ceases to be
an Employee but who remains an employee of an Affiliate which is not a
Participating Employer, and who has in the Plan a Total Balance which is greater
than zero.  An Inactive Participant shall continue to be treated the same as an
Active Participant in every respect except that no contributions of any type
shall be allocated to his Accounts with the exception of those to which he may
be entitled for the Plan Year in which he ceases to be an Active Participant. 
He shall not be allowed to make any contributions unless and until he again
becomes an Active Participant.

 

(c)           Former Participant means an Active Participant or an Inactive
Participant who is no longer an employee of any Affiliate.

 

1.49.       Plan means this Plan Document, together with any Adoption Agreement
executed by the Employer, and the related Trust thereunder as well as any
subsequent amendments to the aforementioned documents.

 

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1.50.       Plan Year means the 12-consecutive month period specified in the
Adoption Agreement.

 

1.51.       Predecessor Employee Account means the account established and
maintained by the Plan Administrator for each Participant with respect to his
interest in the Plan derived from after-tax mandatory Employee contributions
made to another plan of the Employer or an Affiliate and transferred to this
Plan by a merger or otherwise.  A Participant shall be 100% Vested in this
Account, and shall have full rights of withdrawal in accordance with procedures
established by the Administrator.

 

1.52.       Predecessor Employer Account means the account established and
maintained by the Plan Administrator for each Participant with respect to his
interest in the Plan resulting from Employer contributions made to another plan
of the Employer or an Affiliate and transferred to this Plan by a merger or
otherwise. The balance in this account shall be administered in accordance with
all provisions relating to the Participant’s Account herein, and shall be vested
in accordance with the provisions in the Adoption Agreement and in Article VI,
or in the amendment allowing the merger and in Article VI.

 

1.53.       Protected Benefit(s) means:

 

(a)           Accrued benefit of any Participant, directly or indirectly.  Plan
provisions indirectly affecting accrued benefits include, for example,
provisions relating to Years of Service and Breaks-in-Service for determining
benefit accrual, and to actuarial factors for determining optional or early
retirement benefits.

 

(b)           Early retirement benefits.  Any early retirement benefit or a
retirement type subsidy.

 

(c)           Optional form of benefit.  An optional form of benefit is a
distribution form with respect to an Employee’s benefit that is available under
the Plan or any other applicable plan qualified under Code section 401(a) and is
identical with respect to all features relating to the distribution form,
including the payment schedule, timing, commencement, medium of distribution
(e.g., in cash or in-kind), the portion of the benefit to which such
distribution features apply and the election rights with respect to such
optional forms.  To the extent there are any differences in such features, a
plan provides separate optional forms of benefit.  Differences in amounts of
benefits, methods of calculation, or values of distribution forms do not result
in optional forms of benefit for purposes of this rule.

 

The following benefits are not optional forms of benefits:  (1) ancillary life
insurance protection; (2) accident or health insurance benefits; (3) social
security supplements described in Code section 411(a)(9); (4) the availability
of loans (other than the distribution of an employee’s accrued benefit upon
default under a loan); (5) the right to make Nondeductible Employee
Contributions or elective deferrals described in Code section 402(g)(3); (6) the
right to direct investments; (7) the right to a particular form of investment
(e.g., investment in employer stock or securities or investment in certain types
of securities, commercial paper, or other investment media); (8) the allocation
dates for contributions, Forfeitures and earnings, the time for making
contributions (but not the conditions for receiving an allocation of
contributions or Forfeitures for a Plan Year after such conditions

 

18

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have been satisfied), and the Valuation Dates for Account Balances; (9)
administrative procedures for distributing benefits, such as provisions relating
to the particular dates on which notices are given and by which elections must
be made; (10) rights that derive from administrative and operational provisions,
such as mechanical procedures for allocating investment experience among
Accounts in defined contribution plans; and (11) the availability of financial
hardship withdrawals and the rules and procedures governing such withdrawals;
and (12) any other as may be provided by law, regulation, or court order.

 

1.54.       Qualified Domestic Relations Order means (1) a qualified domestic
relations order, as defined in Code section 414(p) and ERISA section 206(d),
entered after December 31, 1984, or (2) a domestic relations order entered
before January 1, 1985.

 

1.55.       Qualified Election means that term as defined in Section 8.03(f). 
No Qualified Election shall be required if this Plan is exempted from the
provisions of Article VIII.

 

1.56.       Qualified Joint and Survivor Annuity means an annuity which is
subject to the provisions of Article VIII.

 

1.57.       Qualified Nonelective Contributions means the Employer’s
contributions to the Plan that are not Salary Deferral Contributions or Matching
Contributions, are allocated to Participants’ Accounts that Participants may not
elect to receive in cash until distributed from the Plan, and that are made
pursuant to Section 3.11.  Such contributions are subject to the restrictions on
withdrawals set forth in Section 7.13(b), and are immediately nonforfeitable and
100% vested upon contribution, regardless of the age and service of the Employee
or whether the Employee is employed on a specific date.

 

1.58.       Qualified Matching Contributions means the Employer Matching
Contributions to the Plan that are subject to the restrictions on withdrawals
set forth in Section 7.13(b), and are immediately nonforfeitable and 100% vested
upon contribution, regardless of the age and service of the Employee or whether
the Employee is employed on a specific date, and are made pursuant to Section
3.11.  Nonelective Contributions and/or Matching Contributions maybe treated as
elective contributions only if the conditions described in section
1.401(k)-1(b)(5) and section 1.401(m)-1(b)(5) of the Regulations are satisfied.

 

1.59.       Rollover Account (related or unrelated) means the individual Account
of an Employee consisting of the Employee’s Rollover Contribution to the Plan,
and income, expenses, gains, losses and distributions attributable thereto.

 

1.60.       Rollover Contribution (related or unrelated) means a contribution of
a qualifying rollover distribution as described in Code section 402(c)(4) or
408(d)(3) which is distributed to an individual, and contributed by such
individual to the Plan in such manner that such portion of the qualifying
rollover distribution so contributed to the Plan does not constitute an Annual
Addition. A rollover is a related rollover if the monies are rolled over from a
plan that is or was sponsored by the Employer or an Affiliate.  All other
Rollover Contributions are unrelated Rollover Contributions.

 

1.61.       Salary Deferral Account means the individual Account of a
Participant consisting of his Salary Deferral Contributions and, if applicable,
any Qualified Nonelective Contributions (together

 

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with portions of certain Plan-to-Plan Transfers identified hereunder) and
income, expenses, gains, losses, and distributions attributable thereto.

 

1.62.       Salary Deferral Election means an election by a Participant to defer
the receipt of Compensation pursuant to a Salary Deferral Agreement as described
in Section 3.03 and adjustments relating thereto, and to have such deferred
amount contributed to the Plan by the Employer on behalf of the Participant as a
Salary Deferral Contribution.

 

1.63.       Self-employed Individual means an individual (as provided for in
Code section 401(c)(1)) who has Earned Income (as defined in Code sections
401(c)(2) and 414(s)) for the taxable year from the trade or business for which
the Plan is established; also, an individual who would have had Earned Income
but for the fact that the trade or business had no Net Profits for the taxable
year.

 

1.64.       Separation from Service will no longer apply as of January 1, 2002
and is replaced with the term Severance from Employment wherever it appears in
the document.  For events prior to January 1, 2002, Separation from Service
applies and should be inserted in the document wherever Severance from
Employment now appears. Separation from Service means an Employee’s voluntary or
involuntary termination of employment with the Employer and its Affiliates, and
any Participating Employers and their Affiliates.  In the event of a sale by the
Employer or a Participating Employer to a purchaser who is not an Affiliate of
the Employer or a Participating Employer of (i) all or substantially all of the
assets used by the Employer or Participating Employer in a trade or business or
(ii) the Employer’s or a Participating Employer’s interest in a subsidiary, a
Separation from Service shall occur on the date of such sale with respect to an
Employee who continues in employment with the corporation or other person
acquiring such assets or with such subsidiary, as the case may be, unless the
purchaser agrees in connection with the sale to be substituted for the Employer
as the sponsor of the Plan or to establish a defined contribution plan that is
qualified under Code section 401(a) to which Plan assets and the amount of the
employee’s benefit under the Plan shall be transferred. Notwithstanding the
above, a Separation from Service shall not occur on the date of sale in the case
of any Employee with respect to whom assets and liabilities attributable to his
benefits under the Plan are transferred to a plan of the new employer regardless
of whether it is a new plan or a pre-existing plan of the former employer. 
Moreover, no Separation from Service shall be treated as having occurred for
purposes of this Plan if the Employee is employed by an employer that, with
respect to the Employer or any Participating Employer, is (1) a corporation
which is a member of a controlled group of corporations with the Employer or any
Participating Employer (within the meaning of Code section 414(b)), (2) a
partnership, joint venture or other business organization (whether or not
incorporated) which is under common control or is affiliated with the Employer
or a Participating Employer (within the meaning of Code section 414(c)), or (3)
any member of an affiliated service group within the meaning of Code section
414(m) of which the Employer or any Participating Employer is a member, or any
other entity required to be aggregated with the Employer pursuant to Code
section 414(o).

 

1.65.       Service means any period of time during which an Employee is
employed by the Employer, including any period of Authorized Absence.  Where the
Employer maintains the plan of a predecessor employer, Service for the
predecessor employer shall be treated as Service for the Employer. If elected by
the Employer in the Adoption Agreement, Service also includes a period of
employment for such designated unrelated employers, and for such designated
periods of time.

 

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1.65(a)   Severance from Employment, effective for Plan Years beginning after
December 31, 2001, means an Employee’s voluntary or involuntary termination of
employment with the Employer and its Affiliates, and any Participating Employers
and their Affiliates.  Notwithstanding the above, a Severance from Employment
shall not occur on the date of sale in the case of any Employee with respect to
whom assets and liabilities attributable to his benefits under the Plan are
transferred to a plan of the new employer regardless of whether it is a new plan
or a pre-existing plan of the former employer.  Moreover, no Severance from
Employment shall be treated as having occurred for purposes of this Plan if the
Employee is employed by an employer that, with respect to the Employer or any
Participating Employer, is (1) a corporation which is a member of a controlled
group of corporations with the Employer or any Participating Employer (within
the meaning of Code section 414(b)), (2) a partnership, joint venture or other
business organization (whether or not incorporated) which is under common
control or is affiliated with the Employer or a Participating Employer (within
the meaning of Code section 414(c)), or (3) any member of an affiliated service
group within the meaning of Code section 414(m) of which the Employer or any
Participating Employer is a member, or any other entity required to be
aggregated with the Employer pursuant to Code section 414(o).

 

1.66.       Shareholder-employee means an individual who is a shareholder of the
Employer, if the Employer is an S corporation as defined in Code section 1361,
and who owns more than five percent (5%) of the combined voting power of all
classes of common stock of the Employer eligible to vote.

 

1.67.       Spouse or Surviving Spouse means the Spouse or Surviving Spouse of
the Participant.  A former Spouse shall be treated as the Spouse or Surviving
Spouse of the Participant if specifically stated in a Qualified Domestic
Relations Order.  To the extent that a Qualified Domestic Relations Order does
not redesignate a former spouse as the beneficiary of the Participant and the
divorce decree is finalized, any prior beneficiary designation of the ex-spouse
by a Participant shall be null and void.

 

1.68.       Top Paid Group means the top 20% of Employees who performed Service
for the Employer during the applicable year, ranked according to the amount of
414(q) Compensation received from the Employer during such year.  All Affiliated
Employers shall be taken into account as a single employer, and Leased Employees
within the meaning of Code sections 414(n)(2) and 414(o)(2) shall be considered
Employees unless such Leased Employees are covered by a plan described in Code
section 414(n)(5) and are not covered in any qualified plan maintained by the
Employer or an Affiliate.  Employees who are non-resident aliens and who
received no earned income (within the meaning of Code section 911(d)(2)) from
the Employer constituting United States source income within the meaning of Code
section 861(a)(3) shall not be treated as Employees.  Additionally, for the
purpose of determining the number of active Employees in any year, the following
additional Employees shall also be excluded; however, such Employees shall still
be considered for the purpose of identifying the particular Employees in the Top
Paid Group:

 

(a)           Employees with less than six (6) months of service;

 

(b)           Employees who normally work less than 17-1/2 hours per week;

 

(c)           Employees who normally work less than six (6) months during a
year; and

 

21

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(d)           Employees who have not yet attained age 21.

 

In addition, if 90% or more of the Employees of the Employer are covered under
agreements the Secretary of Labor finds to be collective bargaining agreements
between Employee representatives and the Employer, and the Plan covers only
Employees who are not covered under such agreements, then Employees covered by
such agreements shall be excluded from both the total number of active Employees
as well as from the identification of particular Employees in the Top Paid
Group.

 

The foregoing exclusions set forth in this Section shall be applied on a uniform
and consistent basis for all purposes for which the 414(q) Compensation
definition is applicable.

 

1.69.       Total Balance means the entire interest of a Participant or Employee
in his Accounts and shall be calculated, as of any given date, as follows:

 

(a)           the balance in all of his Accounts as of the immediately preceding
Valuation Date (if any); plus

 

(b)           any Discretionary, Matching, Salary Deferral, Rollover or
Nondeductible Employee Contribution(s), or any Plan-to-Plan Transfer(s),
refunds, Forfeitures (if applicable), or other amounts to have been credited to
his Accounts since the immediately preceding Valuation Date (if any); minus

 

(c)           the sum of all withdrawals, payments, distributions, premiums or
fees paid since the immediately preceding Valuation Date.

 

1.70.       Trustee means the initial trustee or trustees, or any successor
trustee or trustees at any time acting under this Plan.

 

1.71.       Trust Fund means the fund for the Employer held by the Trustee under
the provisions of this Plan.

 

1.72.       Valuation Date means the last day of each Plan Year unless the Plan
Administrator establishes, in addition, one or more special Valuation Dates.

 

1.73.       Vested Balance means that amount in a Participant’s Accounts that is
nonforfeitable and shall be calculated, on any given date, as follows:

 

(a)           the Participant’s Total Balance; minus

 

(b)           any nonvested amounts in the Participant’s Employer Account that
would be subject to Forfeiture if the Participant were to Separate from Service
as of that date.

 

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1.74.       Year of Service shall be defined as one of the following, as set
forth in the Adoption Agreement:

 

(a)           1,000 Hours of Service Method means the computation period of
12-consecutive months, herein set forth, during which an Employee has been
credited with at least 1,000 Hours of Service; or

 

(b)           Elapsed Time Methodmeans 12-consecutive months of Service.

 

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ARTICLE II.  ELIGIBILITY AND PARTICIPATION.

 

2.01.       Eligibility.  Any Employee who has satisfied the eligibility
requirements specified in the Adoption Agreement shall be eligible to
participate hereunder as of the date he has satisfied such requirements. 
However, if this is an amended and restated plan, any Employee who was a
Participant in the Plan prior to the effective date of such amendment and
restatement shall continue to participate in the Plan.  The Employer shall give
each prospective Eligible Employee written notice of his eligibility to
participate in the Plan on or about the first Entry Date in which he has
satisfied the Eligibility Requirements specified in the Adoption Agreement.

 

2.02.       Eligibility Computation Periods.  For purposes of eligibility for
participation, the initial computation period shall begin with the date on which
the Employee first performs an Hour of Service.  If any Employer becomes an
Affiliate by reason of acquisition, the initial computation period shall begin
with the date on which the Employee first performed an Hour of Service with the
acquired Employer, unless otherwise specified in the Adoption Agreement.  The
eligibility computation period beginning after a one-year Break-in-Service shall
be measured from the date on which an Employee again performs an Hour of
Service.

 

If Breaks-in-Service and Years of Service are computed under the 1,000 Hours of
Service Method, then the eligibility computation period shall shift to the Plan
Year which includes the first anniversary of the date on which the Employee
first performed an Hour of Service.  An Employee who is credited with the
required Hours of Service (as set forth in the Adoption Agreement) in both the
initial computation period (or the computation period beginning after a one-year
Break-in-Service) and the Plan Year which includes the first anniversary of the
date on which the Employee first performed an Hour of Service, shall be credited
with two (2) Years of Service for purposes of eligibility to Participate.

 

If Breaks-in-Service and Years of Service are computed under the Elapsed Time
Method, then subsequent computation periods shall begin on the anniversary date
of the initial computation period.

 

2.03.       Years of Service.  All Years of Service with the Employer are
counted for purposes of satisfying the eligibility requirements.

 

Years of Service with any corporation, trade or business which is a member of a
controlled group of corporations or under common control (as defined by Code
sections 414(b) and 414(c)) or is a member of an affiliated service group (as
defined by Code section 414(m)) shall be recognized, or any other entity
required to be aggregated with the Employer pursuant to Code section 414(o). 
Service shall also be credited for an Employee to the extent required under Code
sections 414(n) or (o), where such Employee is considered an Employee of an
Affiliate, and as may be provided in the Adoption Agreement.

 

2.04.       Commencement and Termination of Participation.

 

(a)           Application for Participation.  In order to become a Participant
hereunder, each Eligible Employee shall make application to the Employer for
participation in the Plan and

 

24

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agree to the terms hereof. Upon the acceptance of any benefits under this Plan,
such Employee shall automatically be deemed to have made application and shall
be bound by the terms and conditions of the Plan and all amendments hereto.

 

(b)           Effective Date of Participation.  Each Employee shall become a
Participant as of the next Entry Date subsequent to the Employee fulfilling the
eligibility requirements specified in the Adoption Agreement of this Plan.

 

(c)           Determination of Eligibility.  The Plan Administrator shall
determine the eligibility of each Employee for participation in the Plan based
upon information furnished by the Employer.  Such determination shall be
conclusive and binding upon all persons, as long as the same is made pursuant to
the Plan and the ERISA.  Such determination shall be subject to review per
Section 7.14.

 

(d)           Forms for Participation.  The Plan Administrator shall notify each
Employee who becomes a Participant and provide him with such forms which are
necessary for the payment of benefits and designation of a Beneficiary.  Before
any contributions shall be made to the Plan on behalf of a Participant, the
Participant must execute such forms as to evidence a Salary Deferral Election.
If an Employee who is not a Participant wishes to make a Rollover Contribution
to the Plan, or a Plan-to-Plan Transfer is proposed to be made to the Plan on
his behalf, such Employee must execute such forms as the Plan Administrator
shall require prior to any such Rollover Contribution or Plan-to-Plan Transfer
being accepted by the Plan Administrator on behalf of the Plan.  Provided,
however, that the Adoption Agreement allows such Rollover Contributions and/or
Plan-to-Plan Transfers.

 

(e)           Reemployment.  A Participant or former Participant who Separates
from Service with the Employer, and who subsequently is reemployed by the
Employer, shall become a Participant and be eligible to participate in the Plan
as of his reemployment commencement date.

 

(1)  In the event such Employee returns to Service prior to incurring a one-year
Break-in-Service, such Employee shall participate immediately upon reemployment.

 

(2)  In the event such Employee returns to Service after incurring a one-year
Break-in-Service, such Employee shall be eligible to participate upon the
earlier of the next Entry Date or the date a new Salary Deferral Agreement may
be executed.

 

(f)            Termination of Eligibility.

 

(1) In the event a Participant shall go from a classification of an Eligible
Employee to an ineligible Employee, such Former Participant shall continue to
vest in his interest in the Plan for each Year of Service completed while a
noneligible Employee, until such time as his Participant’s Account shall be
forfeited or distributed pursuant to the terms of the Plan. Additionally, his
interest in the Plan shall continue to share in the earnings of the Trust Fund.

 

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(2) In the event a Participant is no longer a member of an eligible class of
Employees and becomes ineligible to participate but has not incurred a one-year
Break-in-Service, such Employee will participate immediately upon returning to
an eligible class of Employees.

 

(3) In the event an Employee who is not a member of an eligible class of
Employees becomes ineligible to participate and has incurred a one-year
Break-in-Service, such Employee shall be eligible to participate upon the next
date a Salary Deferral Agreement may be executed upon returning to an eligible
class of Employees.

 

(g)           Inclusion of an Ineligible Employee.  If, in any Plan Year, any
person who should not have been included as a Participant in the Plan is
erroneously included and discovery of such incorrect inclusion is not made until
after a contribution for the year has been made, the Employer shall not be
entitled to recover the contribution made with respect to the ineligible person
regardless of whether or not a deduction is allowable with respect to such
contribution.  In such event, the amount contributed with respect to the
ineligible person shall constitute a Forfeiture (except for Salary Deferral
Contributions which shall constitute an excess elective deferral amount
described in Code sections 401(a)(30) and 402(g)(1) and (2), and which shall be
distributed to the ineligible person, adjusted for any gain or loss) for the
Plan Year in which the discovery is made.

 

(h)           Omission of an Eligible Employee.  If, in any Plan Year, any
person who should be included as a Participant in the Plan is erroneously
omitted and such omission is not discovered until after a contribution is made
by the Employer for the Plan Year, the Employer shall make a subsequent
contribution if necessary after the application of Article III.  Such
contribution shall be made regardless of whether or not it is deductible in
whole or in part in any taxable year under the applicable provisions of the
Code.  Such contribution shall not be adjusted for any unrealized gain or loss. 
Such contribution may be made from Forfeitures if the Adoption Agreement permits
the use of Forfeitures to either reinstate previously forfeited amounts or to
reduce the Employer’s contributions under the Plan.  However, this paragraph
shall not apply to Salary Deferral Contributions.

 

2.05.       Acquisitions.

 

(a)           In general.  If an employer becomes a member of a company or group
described in subsection (b), (c), (m), or (o) of Code section 414 by reason of
acquisition of or by the Employer, and if the Employer so approves, such
acquired employer shall adopt the Plan as a Participating Employer within the
time period described in subparagraph (b) below, unless such employer can be
excluded from adopting the Plan for a reason permitted under Code section
410(b), and provided further that said employer elects not to adopt the Plan as
a Participating Employer.

 

(b)           Entry Date.  The acquired Employer shall adopt the Plan and the
Employer shall set an Entry Date for its eligible Employees within the
Transition Period. The term Transition Period means the period:

 

(1)  beginning on the date such company or group is acquired, and

 

26

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(2)  ending on the last day of the first Plan Year beginning after the date of
such change.

 

(c)           Eligibility Requirements.  On the first Entry Date set by the
Employer for any acquired company or group referred to in  Section 2.05(a), the
eligibility requirements that were applicable for the initial enrollment shall
be applicable for all persons who are members of such company or group, and for
all succeeding Entry Dates, the eligibility requirements applicable after the
initial enrollment shall be applicable for all persons who are members of such
company or group.

 

2.06.       Employees Excluded From Participation.  Unless otherwise provided in
the Adoption Agreement, the Employees not eligible to participate in the Plan
shall be those Employees who:

 

(a)           have not attained the age specified in the Adoption Agreement;

 

(b)           have not completed the period of Service specified in the Adoption
Agreement;

 

(c)           are included in a unit of Employees covered by a collective
bargaining agreement between the Employer and Employee representatives (for this
purpose, “Employee representatives” does not include any organization more than
half of whose members are Employees who are owners, officers, or executives of
the Employer), if retirement benefits were the subject of good faith bargaining
and if two percent (2%) or less of the Employees who are covered pursuant to
that agreement are professionals as defined in section 1.410(b)-9 of the
Regulations;

 

(d)           are nonresident aliens (within the meaning of Code section
7701(b)(1)(B)), and who receive no Earned Income (within the meaning of Code
section 911(d)(2)) from the Employer (or an Affiliate), which constitutes income
from sources within the United States (within the meaning of Code section
861(a)(3)).

 

27

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ARTICLE III.  CONTRIBUTIONS.

 

3.01.       Discretionary Contributions.

 

(a)           In general.  If elected by the Employer in the Adoption Agreement,
the Employer may make Discretionary Contributions to the Plan in such amounts
and at such times as the Employer deems appropriate.  The amount of any such
Contribution shall be determined annually by the Employer on a discretionary
basis, unless otherwise stipulated in the Adoption Agreement.

 

(b)           Contribution date.  Any Discretionary Contribution for a Plan Year
shall be contributed and paid over to the Trustee not later than the date
prescribed by law for filing of the Employer’s federal income tax return
(including extensions thereof) for the Employer’s taxable year ending with or
within such Plan Year.

 

(c)           Miscellaneous rules.  In determining the amount of Discretionary
Contributions to the Plan, the Employer shall be entitled to rely upon an
estimate of the total Compensation for all Participants, and of the amounts
contributed by it.  The Employer’s determination of such Discretionary
Contributions shall be binding on all Participants, the Plan Administrator and
the Trustee.

 

3.02.       Salary Deferral Election.  Each Participant may elect to defer
receipt of his Compensation, up to a limit specified in the Adoption Agreement
and the other provisions of this Plan, and to have that amount withheld from
amounts due to him from the Employer, paid to the Plan and credited to the
Participant’s Salary Deferral Account.  This election shall be made as follows:
For the first Plan Year following or coincident with the Effective Date of this
Plan (if this is a newly established plan), the election shall be made as soon
as administratively practicable and shall be valid for the remainder of the Plan
Year. Thereafter, the election shall be in effect for the period of time
designated in the Salary Deferral Agreement, and shall be subject to the
provisions of Sections 3.03 and 3.04.  The availability of elective deferrals
(Salary Deferral Contributions) under the Plan shall not discriminate in favor
of Highly Compensated Employees.

 

If provided for in the Adoption Agreement, the Employer may automatically defer
a percentage of Compensation identified in the Adoption Agreement for any
Employee eligible to participate who (1) has not made an election to defer a
portion of Compensation and (2) has not affirmatively opted out of the Plan. 
Participants subject to this automatic enrollment process will be given prior
written notice and a reasonable opportunity to take affirmative action to either
elect to defer a portion of Compensation or elect not to participate in the
Plan.

 

3.03.       Salary Deferral Agreement, this section is effective for Plan Years
beginning after December 31, 2001

 

(a)           In general.  Each Plan Year, a Participant may elect to enter into
a written Salary Deferral Agreement with the Employer which shall be applicable
to a specified number of

 

28

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payroll periods within the Plan Year following the date of such agreement.  The
terms of any such Salary Deferral Agreement shall provide that the Participant
agrees to accept a reduction in salary from the Employer equal to any whole
percentage of his Compensation per payroll period, or a fixed dollar amount, or
some combination thereof, not to exceed either:  (1) the percentage specified in
the Adoption Agreement for Salary Deferral Agreement for the Plan Year or (2)
the dollar limit contained in Code section 402(g) in effect at the beginning of
the calendar year. A Participant’s Salary Deferral Contributions for a calendar
year under the Plan, plus the Participant’s elective contributions under all
other plans, contracts and arrangements of the Employer, shall not exceed the
limit imposed by Code section 402(g) for the taxable year beginning in such
calendar year, except to the extent permitted under Section 3.17 of the Plan and
section 414(v) of the Code, if applicable.  In consideration of such agreement,
the Employer shall make a Salary Deferral Contribution to the Participant’s
Salary Deferral Account on behalf of the Participant for such Plan Year in an
amount equal to the total amount by which the Participant’s Compensation from
the Employer was reduced during the Plan Year pursuant to Salary Deferral
Agreement.

 

(b)           Governing rules.  Salary Deferral Agreement shall be governed by
the following:

 

(1)  A Salary Deferral Agreement shall apply to each payroll period during which
an effective Salary Deferral Agreement is on file with the Employer and shall
apply to the Plan Year.

 

(2)  Unless otherwise provided in the Adoption Agreement, a Salary Deferral
Agreement shall be subject to change twice each Plan Year.  First, for the
six-month period beginning on the first day of the Plan Year and second, for the
six-month period beginning on the first day of the Plan Year’s semi-annual
anniversary.  However, a Salary Deferral Agreement may be canceled prospectively
at any time.

 

(3)  Unless otherwise specified in the Adoption Agreement, if a Participant
becomes ineligible for the Plan because of a change in job classification, the
Salary Deferral Agreement shall be revoked effective the date of such change.

 

(4)  An Employee who has become a Participant as a result of the application of
Section 2.04(f) to his circumstances, shall be eligible to establish a Salary
Deferral Agreement on or about the first Entry Date following his change of
status.

 

(5)  If provided for in the Adoption Agreement, a separate Salary Deferral
Agreement shall apply to such portion of a Participant’s Compensation as shall
be paid as bonus amounts, as designated or identified in the Adoption
Agreement.  In the event that the Adoption Agreement provides for a separate
Salary Deferral Agreement be applicable for any such bonus amounts, such
separate Salary Deferral Agreement may be provided for in a separate form or in
the same form as the Salary Deferral Agreement which is applicable for
Compensation not paid as a bonus amount.

 

(c)           Time of Payment of Salary Deferral Contributions.  Salary Deferral
Contributions accumulated through payroll deductions shall be paid to the
Trustee as of the earliest date on

 

29

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which such contributions can reasonably be segregated from the Employer’s
general assets, but in any event within fifteen (15) business days of the month
after the month in which the contributions are received by the Employer.  This
provision does not apply to transfers from nonqualified plans.  The provisions
of Department of Labor Regulations section 2510.3-102 are incorporated herein by
reference.  Furthermore, any additional Employer contributions which are
allocable to the Participant’s Salary Deferral Account for a Plan Year shall be
paid to the Plan no later than the 12-month period immediately following the
close of such Plan Year.

 

3.04.       Salary Deferral Agreement Limitations.

 

(a)           Employer’s right to amend the Salary Deferral Agreement.  The
Employer may limit, revoke, or amend its agreement to make tax-deferred
contributions under Section 3.03 on behalf of any Participant at any time, but
only if it determines that such limitation, revocation or amendment is necessary
under one of the following circumstances:

 

(1)  to insure that any nondiscrimination test under Article III is met for such
Plan Year; or

 

(2)  to insure that a Participant’s Annual Addition for any Limitation Year
shall not exceed the Maximum Permissible Amount; or

 

(3)  that the individual limit on Salary Deferral Contributions described in
Section 3.06 is not exceeded.

 

(b)           Determining taxable income.  If a Participant is prevented from
making a portion of his tax-deferred savings contributions due to a permissible
limitation, revocation or amendment by the Employer, such portion shall be
considered taxable income to the Participant in the tax year for which the
contribution was made and after appropriate taxes have been withheld shall be
returned to the Participant.

 

3.05.       Actual Deferral Percentage Test.

 

(a)           In general.  For each Plan Year, the total contributions to a
Participant’s Salary Deferral Account shall satisfy one of the following tests
pursuant to Code section 401(k)(3) and section 1.401(k)-1(b)(2) of the
Regulations, which are herein incorporated by reference:

 

(1)  The Actual Deferral Percentage for the Highly Compensated Participant Group
shall not be more than the Actual Deferral Percentage of the Nonhighly
Compensated Participant Group multiplied by 1.25; or

 

(2)  The excess of the Actual Deferral Percentage for the Highly Compensated
Participant Group over the Actual Deferral Percentage for the Nonhighly
Compensated Participant Group shall not be more than two percentage points.
Additionally, the Actual Deferral Percentage for the Highly Compensated
Participant Group shall not exceed the Actual Deferral Percentage for the
Nonhighly Compensated Participant Group multiplied by 2.

 

30

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(b)           Definition of Actual Deferral Percentage.  For the purposes of
this Section 3.05, Actual Deferral Percentage means, with respect to the Highly
Compensated Participant Group and Nonhighly Compensated Participant Group for a
Plan Year, the average of the ratios, calculated separately for each Participant
in such group (each Participant’s “Actual Deferral Ratio”) and expressed as a
percentage, of the amount of Salary Deferral Contributions allocated to each
Participant’s Salary Deferral Account (unreduced by any relevant distributions)
for such Plan Year, to such Participant’s 414(s) Compensation for such Plan
Year, and shall be calculated to the nearest one-hundredth of one percent
(0.01%) of a Participant’s 414(s) Compensation.

 

(c)           Prior Year Testing or Current Year Testing Data.  Effective for
Plan Years beginning after December 31, 1996, the Actual Deferral Percentage of
the Nonhighly Compensated Participant Group shall be the preceding Plan Year
data (“Prior Year Testing”). The Employer may elect to use the Plan Year
(“Current Year Testing”) rather than the Prior Year Testing except that if the
Current Year Testing election is made, it may not be changed unless the Employer
satisfies the requirements for changing to Prior Year Testing as set forth in
Internal Revenue Service Notice 98-1 (or superseding guidance).

 

In the case of a Plan’s first Plan Year (other than a successor plan), the
amount taken into account as the Actual Deferral Percentage of the Nonhighly
Compensated Participant Group for the Prior Year Testing shall be 3%, unless the
Employer elects to use Current Year Testing and, therefore, uses the Actual
Deferral Percentage of the Nonhighly Compensated Participant Group during the
first Plan Year.

 

Under transition relief provided by Internal Revenue Service Notice 97-2, the
Employer may elect to use the Current Year Testing method for the 1997 Plan
Year, and will be permitted to use Prior Year Testing for the 1998 and 1999 Plan
Year without receiving approval from the Internal Revenue Service.

 

The Employer shall elect the Prior Year Testing or Current Year Testing method
in the Adoption Agreement. The Employer  may elect to change the testing method
as provided for in Internal Revenue Service Notice 98-1 or its subsequent
modification.

 

(d)           Actual Deferral Percentage Test Safe Harbor Contributions.  An
Employer shall be treated as satisfying the Actual Deferral Percentage Test
under Code section 401(k)(3)(A)(ii) if:

 

(1)           The Employer makes Matching Contributions on behalf of each
Nonhighly Compensated Participant and, at the Employer’s discretion, to the
Highly Compensated Employees in an amount equal to:

 

(A)  100% of the Salary Deferrals of the Nonhighly Compensated Participant to
the extent such Matching Contributions do not exceed 3% of the Participant’s
Compensation, and 50% of the Salary Deferrals of the Nonhighly Compensated
Participant to the extent that such Salary Deferrals exceed 3% but do not exceed
5% of the Participant’s Compensation.

 

31

--------------------------------------------------------------------------------

 

(B)  Notwithstanding the above, an Employer shall not satisfy the Actual
Deferral Percentage Test under this nondiscrimination safe harbor if the rate of
Matching Contribution with respect to any Salary Deferrals of a Highly
Compensated Employee at any rate of Salary Deferral is greater than that with
respect to a Nonhighly Compensated Participant.

 

(C)  The Plan shall not fail to satisfy the nondiscrimination safe harbor under
Section 3.05(d)(1) if (i) the rate of the Employer’s Matching Contribution does
not increase as an Participant’s rate of Salary Deferrals increase, and (ii) the
aggregate amount of Matching Contributions at such rate of Salary Deferral is at
least equal to the aggregate amount of Matching Contributions which would be
made if Matching Contributions were made on the basis of the percentages in
Section 3.05(d)(1)(A) above.

 

(2)           As an alternative to the nondiscrimination safe harbor in Section
3.05(d)(1) above the Employer may satisfy the nondiscrimination safe harbor if
the Employer is required, without regard to whether the Participant makes a
Salary Deferral, to make a contribution to a defined contribution plan, on
behalf of each Nonhighly Compensated Participant, in an amount equal to at least
3% of the Participant’s Compensation.

 

(3)           Each Employee eligible to participate in the Plan is, within a
reasonable period before any year, given written notice of the Employee’s rights
and obligations under the nondiscrimination safe harbor which (A) is
sufficiently accurate and comprehensive to apprise the Employee of such rights
and obligations, (B) is written in a manner calculated to be understood by the
average Employee eligible to participate; and (C) each Eligible Employee has at
least 30 days following receipt of the notice to make or modify their Salary
Deferral Agreement.

 

(4)           The Employer contributions made under Section 3.05(d)(1) or
3.05(d)(2) are not distributable to Participants or their Beneficiaries until
Severance from Employment, death or Disability or termination of  the Plan or
disposition of assets or subsidiary, and the Participant’s right to his accrued
benefit derived from Employer contributions is nonforfeitable at all times.

 

(e)           Two or more cash or deferred plans.  If two (2) or more plans
which include cash or deferred arrangements are considered one plan for the
purposes of Code section 401(a)(4) or 410(b) (other than the average benefits
test under Code section 410(b)(2)(A)(ii), as in effect for Plan Years beginning
after December 31, 1988), the cash or deferred arrangement included in such
plans may be treated as one arrangement for purposes of determining whether or
not such arrangements satisfy Code sections 401(a)(4), 410(b) and 401(k). In
such a case, the cash or deferred arrangements shall be treated as one
arrangement and as one plan for purposes of this Section and Code sections
401(a)(4), 410(b) and 401(k).  In the event  that two or more plans of the
Employer which include cash or deferred arrangements are permissively aggregated
for purposes of Code section 401(k), such aggregated plans must satisfy this
Section, and Code sections 401(k), 401(a)(4) and 410(b) as though such plans
were a single plan.  For Plan Years beginning after December 31, 1989, plans
shall be

 

32

--------------------------------------------------------------------------------

 

aggregated under this paragraph (f) only if they have the same plan year and use
the same Actual Deferral Percentage Testing method.  Notwithstanding the above,
for Plan Years beginning after December 31, 1988, an employee stock ownership
plan described in Code section 4975(e)(7) may not  be combined with this Plan
for purposes of determining whether the employee stock ownership plan or this
Plan satisfy this Section and Code sections 401(a)(4), 410(b) and 401(k).

 

(f)            Special rule for Highly Compensated Participants.  For the
purposes of this Section, if a Highly Compensated Participant is a Participant
under two or more cash or deferred arrangements (other than a cash or deferred
arrangement which is part of  an employee stock ownership plan as defined in
Code section 4975(e)(7) for Plan Years beginning after December 31, 1988) of the
Employer or an Affiliate, all such cash or deferred arrangements shall be
treated as one cash or deferred arrangement for the purpose of determining the
Actual Deferral Percentage with respect to such Highly Compensated Participant. 
However, for Plan Years beginning after December 31, 1988, if the cash or
deferred arrangements have different Plan Years, this paragraph shall be applied
by treating all cash or deferred arrangements ending with or within the same
calendar year as a single arrangement.

 

3.06.       Individual Limitation on Salary Deferral Contributions.

 

(a)           Elective Deferrals or Salary Deferrals  shall mean any Employer
Contributions made to the Plan at the election of the Participant, in lieu of
cash Compensation, and which was not currently available to the Participant at
the time of the election to defer, and shall include contributions made pursuant
to a Salary Deferral Agreement or other deferral mechanism.  A Participant’s
Elective Deferrals for any taxable year are the sum of all employer
contributions made on behalf of such Participant pursuant to any qualified cash
or deferred arrangement as described in Code section 401(k), any Simplified
Employee Pension Plan cash or deferred arrangement as defined in Code section
408(k) to the extent such contributions are not includible in the individual’s
gross income for the taxable year on account of Code section 402(h)(1)(B), any
eligible deferred compensation plan under Code section 457, any plan as
described under Code section 501(c)(18), and any employer contributions made on
behalf of a Participant for the purchase of an annuity contract under Code
section 403(b) pursuant to a salary deferral agreement.

 

For purposes of determining the dollar limitation under Code section 402(g), any
deferrals properly distributed as excess Annual Additions or returned as Excess
Contributions shall not be included.

 

(b)           Excess Deferrals or Excess Salary Deferralsshall mean those
Elective Deferrals that are includible in a Participant’s gross income to the
extent such Participant’s Elective Deferrals for a calendar year exceed the
dollar limitation under Code section 402(g), as determined by the Secretary of
the Treasury for a calendar year.  Such limitation shall apply to the individual
Participant and shall apply to all qualified cash or deferred arrangements, as
described in Code section 401(k), any Simplified Employee Pension Plan cash or
deferred arrangement as defined in Code section 408(k) to the extent such
contributions are not includible in the individual’s gross income for the
taxable year on account of Code section 402(h)(1)(B), any eligible deferred
compensation plan under Code section 457, any plan as

 

33

--------------------------------------------------------------------------------

 

described under Code section 501(c)(18), and any employer contributions made on
behalf of a Participant for the purchase of an annuity contract under Code
section 403(b) pursuant to a salary deferral agreement.

 

(c)           Date when Excess Deferrals are to be distributed.  For any
individual who has Excess Deferrals or Excess Salary Deferrals under this Plan,
not later than the first April 15 following the close of the individual’s
taxable year, the Plan Administrator shall distribute to such individual the
amount of his Excess Deferral (and any income allocable to such amount).

 

(d)           Designation of Excess Deferrals.  An individual who has Excess
Deferrals for a taxable year may receive a corrective distribution of all or a
portion of such deferrals during such taxable year or by April 15 of the next
taxable year.  Such corrective distribution may be made only if all of the
following conditions are satisfied:

 

(1)  The individual designates the distribution from this Plan as an Excess
Deferral prior to April 15 of the next taxable year;

 

(2)  The correcting distribution is made after the date on which the Plan
received the Excess Deferral; and

 

(3)  The Plan designates the distribution as a distribution of Excess Deferrals.

 

In order to distribute Excess Deferrals pursuant to this paragraph, such
individual must make such designation in writing and the individual must certify
or otherwise establish that the specified amount is an Excess Deferral.

 

(e)           Income.  The income allocable to Excess Deferrals or Excess Salary
Deferrals is equal to the sum of the allocable gain or loss for the taxable year
of the individual and the allocable gain or loss for the period between the end
of the taxable year and the date of distribution, and is determined by
multiplying the Excess Deferrals for the taxable year of the individual by a
fraction.  The numerator of the fraction is the amount of the total gain or loss
allocated to the individual for the taxable year. The denominator of the
fraction is the total balance of the Employee at the end of the taxable year,
reduced by the gain allocable to such total amount for the taxable year and
increased by the loss allocable to such total amount for the taxable year.

 

Effective for Plan Years beginning on or after January 1, 1994, lag period
income or gap income (the income attributable to such Excess Contributions for
the period between the end of the Plan Year, to which such Excess Contributions
relate, and the date of distribution) shall not be required to be calculated.

 

(f)            Lag period income.  If, however, the lag period or gap period
income is to be calculated, (if the Adoption Agreement provides), the allocable
income for the period between the end of the taxable year and the distribution
date is equal to ten percent (10%) of the income allocable to Excess Deferrals
for the taxable year (as calculated under paragraph (e)) multiplied by the
number of calendar months that have elapsed since the end of the

 

34

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taxable year.  A distribution occurring on or before the fifteenth day of the
month shall be treated as having been made on the last day of the preceding
month, and a distribution occurring after such fifteenth day shall be treated as
having been made on the first day of the next subsequent month.

 

(g)           Coordination with Excess Contributions.  Excess Deferrals to be
distributed to a Participant for his taxable year shall be reduced by Excess
Contributions previously distributed for the Plan Year beginning in such taxable
year.

 

(h)           Notification by Employee.  If the Plan is not notified by a
Participant that such Participant’s limitation of Salary Deferral Contributions
(under Code section 402(g)) as described in paragraphs (a) and (b) of this
Section 3.06 has been exceeded, the Plan shall assume that such limitation has
not been exceeded by such Participant’s Salary Deferral Contributions to the
Plan.

 

3.07.       Matching Contributions.  If elected by the Employer in the Adoption
Agreement, the Employer can make a Matching Contribution to the Plan on behalf
of each Participant who makes a Salary Deferral Contribution or Nondeductible
Employee Contribution for that Plan Year. The amount of such Matching
Contributions shall be calculated for each Participant as specified by the
Employer in the Adoption Agreement.  All Matching Contributions for any given
Plan Year shall be contributed to the Trust by the Employer within the time
prescribed by law, including extensions of time, for the filing of the
Employer’s federal income tax return for the Employer’s fiscal year.  The
availability of Matching Contributions (if applicable) and Nondeductible
Employee Contributions (if applicable) under the Plan shall not discriminate in
favor of Highly Compensated Employees.

 

3.08.       Nondeductible Employee Contributions.

 

(a)           In general.  If the Adoption Agreement provides for Nondeductible
Employee Contributions, a Participant may, at his option, make such
Contributions to the Plan in cumulative amounts not to exceed ten percent (10%)
of his Compensation for the Plan Year, or such percentage as specified in the
Adoption Agreement. The amount of such Contributions, if any, shall be
designated by the Participant on a form prescribed by the Plan Administrator. 
The method of payment of such Contributions shall be by payroll withholding
unless otherwise specified in the Adoption Agreement.

 

(b)           Recharacterization of Excess Contributions.  If Nondeductible
Employee Contributions are provided for in the Adoption Agreement, in any Plan
Year in which a Participant shall have an Excess Contribution amount, such
Participant may elect to treat such excess amounts pursuant to the provisions of
this subsection (b), or have such amounts distributed pursuant to Code section
401(k)(3) and the applicable regulations.

 

A Participant may treat his or her Excess Contribution amounts, for the Plan
Year for which such Excess Contributions relate, as an amount distributed to
such Participant and subsequently contributed by such Participant to the Plan. 
Contributions which are treated in the aforementioned manner shall be referred
to as “Recharacterized” amounts.  Recharacterized amounts shall be
nonforfeitable and subject to the same distribution requirements as Salary
Deferral amounts.  Notwithstanding the foregoing, amounts may

 

35

--------------------------------------------------------------------------------

 

not be Recharacterized by a Highly Compensated Participant to the extent that
such amounts in combination with other Nondeductible Employee Contributions
would exceed any stated limit under Sections 3.07 and 3.08(a) (determined prior
to applying Code section 401(m)(2)(A) and Section 3.09).

 

Recharacterization must occur no later than two and one-half (2 1/2) months
after the last day of the Plan Year in which such Excess Contributions arose and
is deemed to occur no earlier than the date the last Highly Compensated
Participant is informed in writing of the amount Recharacterized and the
consequences thereof.  Recharacterized amounts shall be taxable to a Participant
for a Participant’s tax year in which such Participant would have received such
amounts in cash.

 

3.09.       Actual Contribution Percentage Test.

 

(a)           In general.  For Plan Years beginning after December 31, 1986,
Nondeductible Employee Contributions and Matching Contributions shall satisfy
the tests defined in Code section 401(m), and sections 1.401(m)-1(b)(1) and
1.401(m)-2 of the  Regulations, which are hereby incorporated by reference. For
purposes of Sections 3.09 and 3.10 only, Matching Contribution means any
Employer Contribution made to the Plan on account of a Salary Deferral
Contribution made to the Plan, and any Forfeiture directly or indirectly
allocated on the basis of Salary Deferral Contributions or Matching
Contributions.  The tests are as follows.

 

(1)  The Actual Contribution Percentage for the Highly Compensated Participant
Group shall not exceed the greater of:

 

(A)  125% of such percentage for the Nonhighly Compensated Participant Group for
the preceding Plan Year, or

 

(B)  the lesser of 200% of such percentage for the Nonhighly Compensated
Participant Group for the preceding Plan Year, or such percentage for the
Nonhighly Compensated Group for the preceding Plan Year plus two (2) percentage
points.

 

The Employer may elect to use Current Year Testing rather than Prior Year
Testing except that if the Current Year Testing election is made, it may not be
changed unless the Employer satisfies the requirements for changing to Prior
Year Testing as set forth in Internal Revenue Service Notice 98-1 (or its
subsequent modification), or as provided by the Internal Revenue Service.

 

In the case of a Plan’s first Plan Year (other than a successor plan), the
amount taken into account as the Actual Contribution Percentage of the Nonhighly
Compensated Participant Group for the Prior Year Testing shall be 3%, unless the
Employer elects to use Current Year Testing and, therefore, uses the Actual
Contribution Percentage of the Nonhighly Compensated Participant Group during
the first Plan Year.

 

36

--------------------------------------------------------------------------------

 

(b)           Nondiscrimination Safe Harbor.  A Plan shall be treated as
satisfying the Actual Contribution Percentage Test under Code section 401(m)(2)
if:

 

(1)           The Employer satisfies the nondiscrimination safe harbor for the
Actual Deferral Percentage Test in Section 3.05(d), and

 

(A)  The Matching Contributions made on behalf of any Participant are not made
with respect to a Participant’s Salary Deferrals in excess of 6% of the
Participant’s Compensation, and

 

(B)  The rate of a Participant’s Matching Contribution does not increase as the
rate of a Participant’s Salary Deferrals increase, and

 

(C)  The Matching Contribution with respect to any Highly Compensated Employee
at any rate of Salary Deferral Contributions is not greater than that with
respect to a Nonhighly Compensated Participant; or

 

(2)           The Plan satisfies the contribution requirements of Code section
401(k)(11)(B) or 401(k)(12), the vesting requirements of Code section
401(k)(12)(E)(i), and the notice requirement of Code section 401(k)(12)(D).

 

3.10.       Limitation of Multiple Use of Alternate Limit.

 

(a)           In general.  For Plan Years beginning after December 31, 2001, the
multiple use test described in Treasury Regulation section 1.401(m)-2 and
Section 3.10 of the Plan shall not apply.

 

(b)           Aggregate Limit.  The Aggregate Limit is the greater of:

 

(1)           The sum of:

 

(A)  1.25 times the greater of the Actual Deferral Percentage or the Actual
Contribution Percentage, and

 

(B)  Two percentage points plus the lesser of the Actual Deferral Percentage or
the Actual Contribution Percentage. In no event, however, shall this amount
exceed twice the lesser of the Actual Deferral Percentage or the Actual
Contribution Percentage; or

 

(2)           The sum of:

 

(A)  1.25 times the lesser of the Actual Deferral Percentage or the Actual
Contribution Percentage, and

 

37

--------------------------------------------------------------------------------

 

(B)  Two percentage points plus the greater of the Actual Deferral Percentage or
the Actual Contribution Percentage.  In no event, however, shall this amount
exceed twice the greater of the Actual Deferral Percentage or the Actual
Contribution Percentage.

 

(3)           Correction of Multiple Use:

 

(A)  More than one plan: If a multiple use of the alternate limitation occurs
with respect to two or more plans or arrangements maintained by the Employer,
such multiple use shall be corrected by reducing the Actual Deferral Percentage
of Highly Compensated Participants in the manner described in subparagraph (C)
below.

 

(B)  To the extent that a Participant has unmatched Salary Deferral
Contributions, the required reductions shall be from Salary Deferral
Contributions; thereafter, Salary Deferral Contributions and Matching
Contributions shall be reduced on a pro-rata basis.

 

(C)  The amount of the reduction to the Actual Deferral Percentage of the entire
group of Highly Compensated Participants shall be calculated in the manner
described in the Code section 401(k)(2) regulations, unless otherwise stipulated
in the Adoption Agreement, so that there is no multiple use of the alternate
limitation.  Unless otherwise specified in the Adoption Agreement, only the
Actual Deferral Percentages of all Highly Compensated Participants who are
eligible in both the arrangement subject to Code section 401(k) and the Plan
subject to Code section 401(m) shall be reduced.

 

3.11.       Qualified Nonelective and Matching Contributions.

 

(a)           Allocation of Qualified Nonelective Contributions.  If the
Employer has elected to use Current Year Testing, then on behalf of each
Nonhighly Compensated Participant, the Employer may, at its sole discretion,
make a Qualified Nonelective Contribution equal a percentage between 0% to 10%
of each eligible individual’s Compensation, the exact percentage to be
determined each year by the Employer.

 

(1)  The Employer shall have the sole discretion to designate which Nonhighly
Compensated Participants, if any, shall receive a Qualified Nonelective
Contribution, if any, for any Plan Year.

 

(2)  In any Plan Year, the Employer may designate which test, either as
described in Section 3.05 or as described in Section 3.09 to which such
Qualified Nonelective Contributions, if any, shall be applied.

 

(b)           Actual Deferral Percentage Test.  All or part of the Qualified
Nonelective Contributions and Qualified Matching Contributions made with respect
to Participants may be treated as Salary Deferral Contributions for purposes of
the Actual Deferral Percentage Tests set forth in Section 3.05.  Qualified
Matching Contributions and Qualified Nonelective

 

38

--------------------------------------------------------------------------------

 

Contributions used to satisfy the Actual Deferral Percentage shall be
disregarded for purposes of satisfying the Actual Contributions Percentage Tests
set forth in Section 3.09. Qualified Nonelective Contributions and Qualified
Matching Contributions used to satisfy the Actual Deferral Percentage Tests
shall be deemed Salary Deferral Contributions.

 

(c)           Actual Contribution Percentage Test.  Qualified Matching
Contributions used to satisfy the Actual Deferral Percentage Test are not
subject to the Actual Contribution Percentage Test.  All or part of the
Qualified Nonelective Contributions made with respect to Participants in the
Plan, and which are not used to satisfy the Actual Deferral Percentage Test, may
be used to satisfy the Actual Contribution Percentage Test.  Qualified
Nonelective Contributions used to satisfy the Actual Contribution Percentage
Test shall be deemed Matching Contributions.

 

(d)           Restrictions.  Qualified Matching Contributions and Qualified
Nonelective Contributions used to satisfy the Actual Deferral Percentage Test
shall not be taken into account in determining whether the requirements of the
Actual Contribution Percentage Test are satisfied.  Qualified Matching
Contributions and Qualified Nonelective Contributions used to satisfy the Actual
Contribution Percentage Test shall not be taken into account in determining
whether the requirements of the Actual Deferral Percentage Test are satisfied.
Only Qualified Matching Contributions and Qualified Nonelective Contributions
made for the Plan Year may be used for purposes of satisfying the Actual
Deferral Percentage Test and Actual Contribution Percentage Test for that same
Plan Year.

 

(e)           Return of Excess Contributions.  If Qualified Matching
Contributions are used to satisfy the Actual Deferral Percentage Test, and, as a
result of the test for a given Plan Year, there are Excess Contributions, then
the distribution of the Excess Contributions shall be as follows.  First, all
Salary Deferral Contributions that were not matched with Qualified Matching
Contributions shall be distributed, and then, if required, the Qualified
Matching Contributions deemed as Salary Deferral Contributions and the remaining
Salary Deferral Contributions shall be distributed pro-rata.

 

(f)            Employer Election.  The Plan Administrator may elect, in any Plan
Year, to treat all or a part of the Employer’s Matching Contributions for such
Plan Year as a Qualified Matching Contribution subject to the restrictions of
this Section 3.11.

 

3.12.       Rollover Contributions and Plan-to-Plan Transfers.  Unless
prohibited in the Adoption Agreement, the Plan may permit Rollover Contributions
(as described in Plan Section 1.60) and/or Plan-to-Plan Transfers, subject to
Plan Administrator’s sole discretion and approval and subject to the provisions
of this Section.

 

(a)           Rollovers.  The Trustee shall accept Rollover Contributions from
any Employee, whether or not he is otherwise a Participant in this Plan;
provided, however, that the Plan Administrator must first certify to the Trustee
that such amount qualifies as a Rollover Contribution.

 

(b)           Plan-to-Plan Transfers.

 

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(1)           The term “Plan-to-Plan Transfer” means a transfer of assets
between this Plan and another qualified plan.  Unless specifically prohibited in
the Adoption Agreement, the Trustee may accept Plan-to-Plan Transfers from
another qualified plan under Code section 401(a) if the funds so transferred
were held for the benefit of a person who is an Employee, whether or not a
Participant, at the time of such transfer, provided, however, that the Plan
Administrator must first certify to the Trustee (a) that such other employee
benefit plan is qualified under Code section 401(a), and (b) what portion, if
any of the funds to be received in a Plan-to-Plan Transfer were subject to
restrictions on distributions similar to those set forth in Code section
401(k)(2)(B) or 401(a)(11)(B)(iii)(III) while in the other qualified plan. 
However, if the Plan-to-Plan Transfer is the result of a merger or partial
merger of another profit sharing plan qualified under Code section 401(a), the
Employer may amend the Plan to designate the accounts to which the monies will
be applied, within the applicable limits of the law. Notwithstanding anything
herein to the contrary, a transfer directly to this Plan from another qualified
plan (or a transaction having the effect of such a transfer) shall only be
permitted if it will not result in the elimination or reduction of a Protected
Benefit.

 

(2)           The Plan will accept deferrals and match contributions that are
legally and timely transferred from a nonqualified “Top-Hat” plan of the
Employer with respect to Employees who are Participants in this Plan and
Participants in the nonqualified plan.

 

(c)           Rollover or Plan-to-Plan Transfer from Employer ESOP.  Unless
specifically prohibited in the Adoption Agreement, the Plan shall accept a
Rollover or Plan-to-Plan Transfer from an Employer’s employee stock ownership
plan (“ESOP”), as defined in Code section 4975(e).  The portion of an Employee’s
ESOP Account which is eligible for “diversification” (as described in Code
section 401(a)(28)(B)) may be rolled over or transferred to the Plan at the
election of such Employee. Prior to approving such rollover or transfer, the
Plan Administrator shall ascertain that the amount which is to be rolled over or
transferred, in order to satisfy the “diversification” requirement of Code
section 401(a)(28)(B), is eligible for “diversification” under the applicable
provisions of the ESOP.

 

3.13.       Return of Contributions.  Employer Contributions shall not be
returned to the Employer except as described in Plan Sections 13.10 and 13.11.

 

However, any Salary Deferral Contributions that are returned under Section 13.10
shall always be returned to the Employee on whose behalf such contributions were
made, and under no circumstances shall such Salary Deferral Contributions ever
revert to the Employer.  Any such returned Salary Deferral Contributions shall
be adjusted to include earnings on such returned contributions.

 

3.14.       Owner-Employee Provisions.  If the Plan provides contributions or
benefits for one or more Owner-Employees who control both the business for which
this Plan is established and one or more other trades or businesses, this Plan
and the plan established for such other trades or businesses must, when looked
at as a single plan, satisfy Code sections 401(a) and (d) for the employees of
this and all other trades or businesses. If the Plan provides contributions or
benefits for one or more Owner-Employees who control one or more other trades or
businesses, the employees of the other trades or

 

40

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businesses must be included in a plan which satisfies Code sections 401(a) and
(d) and which provides contributions and benefits not less favorable than
provided for such Owner-Employees under this Plan. For purposes of this Section,
an Owner-Employee, or two or more Owner-Employees, shall be considered to
control a trade or business if the Owner-Employee or two or more Owner-Employees
together, (1) own the entire interest in an unincorporated trade or business, or
(2) in the case of a partnership, own more than 50% of either the capital
interest or the profits interest in the partnership.  An Owner-Employee shall be
treated as owning any interest in a partnership which is owned, directly or
indirectly, by a partnership which such Owner-Employee, or two or more such
Owner-Employees, are considered to control within the meaning of the preceding
sentence.

 

3.15.       Other Nondiscrimination Requirements.  Any other Employer
Contributions made to the Plan, other than Rollover Contributions, that are not
subject to the nondiscrimination tests set forth in either Sections 3.05, 3.09
or 3.10, shall be allocated on the basis of a uniform formula.  Such uniform
formula shall allocate contributions to every Eligible Employee according to
Compensation or such contributions shall be the same dollar amount for each
eligible Employee. Such formula shall be specified in the Adoption Agreement.

 

3.16.       Qualified Military Service.  Notwithstanding any provision of this
Plan to the contrary, effective December 12, 1994, contributions, benefits and
Service credit with respect to qualified military service will be provided in
accordance with Code section 414(u).

 

3.17.       Catch-up Contributions.  If elected by the Employer in the Adoption
Agreement, all Participants who are eligible to make Salary Deferral
contributions under this Plan and who have attained age 50 before the close of
the Plan Year shall be eligible to make Catch-up Contributions in accordance
with, and subject to the limitations of, section 414(v) of the Code. Such
Catch-up Contributions shall not be taken into account for purposes of the
provisions of the Plan implementing the required limitations of sections 402(g)
and 415 of the Code. The Plan shall not be treated as failing to satisfy the
provisions of the Plan implementing the requirements of section 401(k)(3),
401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by reason of
the making of such Catch-up Contributions.

 

41

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ARTICLE IV. PARTICIPANT ACCOUNTS AND ALLOCATIONS.

 

4.01.       Establishment of Accounts.

 

(a)            Employer Matching Account.  If the Employer makes any Matching
Contributions to the Plan, the Plan Administrator shall establish an Employer
Matching Account for each Participant.

 

(b)            Employer Discretionary Account. If the Employer makes any
Discretionary Contributions to the Plan, the Plan Administrator shall establish
an Employer Discretionary Account for each Participant.

 

(c)            Nondeductible Employee Account.  .If the Employer allows
Nondeductible Employee Contributions in the Adoption Agreement, the Plan
Administrator shall establish a Nondeductible Employee Account for each
Participant who makes a Nondeductible Employee Contribution.

 

(d)            Unrelated Rollover Account.  If the Adoption Agreement allows
Rollover Contributions from plans unrelated to the Employer, the Plan
Administrator shall establish an Unrelated Rollover Account for each Employee
who makes such an Unrelated Rollover Contribution or for whose benefit such an
Unrelated Rollover is made to the Plan.

 

(e)            Related Rollover Account.   If the Adoption Agreement allows
Related Rollover Contributions from plans related to the Employer, the Plan
Administrator shall establish a Related Rollover Account for each Employee who
makes such a Related Rollover Contribution or for whose benefit such a Related
Rollover is made to the Plan.

 

(f)            Plan-to-Plan Transfer Account.   If the Employer allows
Plan-to-Plan Transfers in the Adoption Agreement, the Plan Administrator shall
establish a Plan-to-Plan Transfer Account for each Employee who makes a
Plan-to-Plan Transfer or for whose benefit a Plan-to-Plan Transfer is made to
the Plan.

 

(g)           Salary Deferral Account.  The Plan Administrator shall establish a
Salary Deferral Account for each Participant and for those Employees who are not
otherwise Participants but for whose benefit Plan-to-Plan Transfers are made
which include funds subject to the restrictions on distribution set forth in
Code section 401(k)(2)(B).

 

(h)           Qualified Matching Contribution Account.   If the Employer makes
any Qualified Matching Contributions to the Plan, the Plan Administrator shall
establish a Qualified Matching Contribution Account for each Participant.

 

(i)            Qualified Nonelective Contribution Account.  If the Employer
makes any Qualified Nonelective Contributions to the Plan, the Plan
Administrator shall establish a Qualified Nonelective Contribution Account for
each Participant.

 

42

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(j)            Forfeiture Account.  If the Plan reallocates Forfeitures to
Participants in accordance with Section 4.06(f)(3) or 4.06(f)(4), the Plan
Administrator shall establish a Forfeiture Account for each Participant.

 

(k)           Predecessor Employee Account.  An Account established on behalf of
each Participant pursuant to Section 1.51.

 

(l)            Predecessor Employer Account. An Account established on behalf of
each Participant pursuant to Section 1.52.

 

(m)          Employer Account. Shall mean the Employer Matching Account and the
Employer Discretionary Account of each Participant.

 

(n)           Rollover Account.  Shall mean the Unrelated Rollover Account and
the Related Rollover Account of each Participant.

 

4.02.       Accounting Procedure for Allocations.

 

(a)            In general.  As of each Valuation Date, the Plan Administrator
shall:

 

(1)  First, allocate, as necessary under this Plan, to such Participant’s
Employer Matching Account, Forfeitures to any Participant who is entitled to
have their Forfeitures restored;

 

(2)  Next, allocate to each Participant’s Accounts any Nondeductible Employee
Contributions, Related and Unrelated Rollover Contributions, Salary Deferral
Contributions, Matching Contributions, Discretionary Contributions and
Plan-to-Plan Transfers that are to be allocated as of the Valuation Date in
accordance with this Article;

 

(3)  Next, allocate all withdrawals, payments or distributions made from such
Participants’ Accounts since the next preceding Valuation Date that have not
been previously allocated;

 

(4)  Next, debit Participants’ Accounts for administrative fees paid, if any;

 

(5)  Next, debit Participants’ Accounts for any insurance or annuity premiums
paid, if any, and credit with any dividends received on insurance contracts;

 

(6)  Next, use Forfeitures to reduce the Employer’s Contributions, or allocate
Forfeitures to Participants, as specified in the Adoption Agreement;

 

(7)  Finally, allocate the net income or net loss of the Trust Fund in
accordance with the computation procedures set out in Section 4.04.

 

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(b)            Securities.  The Valuation Date shall also be the inventory date
for securities held by the Trust. The fair market value on the inventory date
shall be used for a valuation of the securities held by the Trust. The
respective Accounts of Participants are to be adjusted in accordance with the
valuation.

 

(c)            Insurance Contracts.  Allocated life insurance and/or annuity
contracts, i.e., contracts which are purchased to provide certain specified
benefits for specific Participants, shall be presented on the Plan’s financial
statements in accordance with generally accepted accounting principles.

 

4.03.       Allocation of Participant Contributions.

 

(a)            Nondeductible Employee Contributions. All Nondeductible Employee
Contributions shall be credited to the Nondeductible Employee Account of the
Participant making the contribution as of each Valuation Date.

 

(b)            Rollover Contributions.  All Rollover Contributions shall be
credited to the applicable Rollover Account of the Employee making the
contribution as of each Valuation Date.

 

(c)            Plan-to-Plan Transfers.  All Plan-to-Plan Transfers shall be
credited to the Plan-to-Plan Transfer Account of such Employee as of each
Valuation Date.  Notwithstanding the preceding, any portion of a Plan-to-Plan
Transfer or Rollover contribution that the Plan Administrator has certified to
the Trustee as having been subject to the restrictions on distribution set forth
in Code section 401(k)(2)(B) while in the other qualified plan shall be credited
to the Salary Deferral Account of the Employee, as of each Valuation Date.

 

4.04.       Allocation of Net Income or Net Loss.

 

(a)            As of each Valuation Date, the Trustee or its designee shall
subtract all distributions and withdrawals since the previous Valuation Date,
add to each Account the amount of the contributions, and allocate the net
earnings and gains or losses of the fund based on the individual account
activity of each such Participant’s Account during such period pursuant to a
share accounting method under which each Participant’s investments in the
investment funds shall be accounted for in actual shares purchased by the Plan
contributions and allocated to the Participant’s Account.  For this purpose, the
Trustee or its designee, shall adopt uniform rules which conform to applicable
law and generally accepted accounting practices.  However, notwithstanding the
above, a Participant shall cease to share in any earnings after Plan assets
attributable to his Account are transferred into a disbursement account pending
sale or liquidation of the Participant’s relevant investment funds and
distribution of the proceeds thereof.

 

(b)            If the Plan Administrator determines in making any valuation,
allocation, or adding interest to any Account under the provisions of the Plan
that the strict application of the provisions of the Plan will not produce an
equitable and nondiscriminatory allocation among the Accounts of the
Participants, it may modify any procedure specified in the Plan for the purpose
of achieving an equitable and nondiscriminatory allocation in accordance with
the

 

44

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general concepts of the Plan; provided, however, that any such modification
shall not reduce the Participant’s vested Account and shall be consistent with
the provisions of Code section 401(a).  If the Plan Administrator in good faith
determines that certain expenses of administration paid by the Trustee during
the Plan Year under consideration are not general, ordinary, and usual and
should not equitably be borne by all Participants, but should be borne only by
one or more Participants, for whom or because of whom such specific expenses
were incurred, the net earnings and adjustments in value of the Accounts shall
be increased by the amounts of such expenses, and the Plan Administrator shall
make suitable adjustments by debiting the particular Account or Accounts of such
one or more Participants; provided, however, that any such adjustment must be
nondiscriminatory and consistent with the provisions of Code section 401(a).

 

(c)            As of each Valuation Date, any net income or net loss of the
Trust Fund that is not attributable to (a) above shall be allocated in a
nondiscriminatory manner as directed by the Plan Administrator.

 

4.05.       Ascertainment of Net Income and Net Loss.  Net income or net loss of
the Trust Fund shall be ascertained as of each Valuation Date by the Trustee,
whose finding shall be accepted by the Plan Administrator as conclusive, and
shall mean the profit and any income received less the losses and expenses of
the Trust Fund, plus or minus any net increase or decrease in the fair market
value of the assets of the Trust Fund not realized. Such net income or net loss
shall be determined in accordance with the accounting method selected by the
Employer.  Any life insurance contracts held by the Trustee shall be valued in
accordance with  Section 4.02(c) as of the Valuation Date, but such contracts
shall be listed separately by type of contract and allocated to the appropriate
Account of each Participant for whom they are held.

 

4.06.       Allocation of Employer Contributions and Forfeitures.

 

(a)            Discretionary Contributions:  Allocation in Proportion to
Compensation.  If the Employer elects to make Discretionary Contributions, all
such Contributions shall be allocated to the Employer Discretionary Account of
each Participant entitled to share in the allocation of such Contributions, as
of each Valuation Date.  Except to the extent otherwise elected by the Employer
in the Adoption Agreement, only those Participants who have completed a Year of
Service during the Plan Year and who are employed on the last day of the Plan
Year shall share in the allocation of Discretionary Contributions for such Plan
Year, and then only on the basis of their respective Compensation, unless
otherwise elected by the Employer in the Adoption Agreement.  The preceding
sentence notwithstanding, a Participant who has Separated from Service, during
the Plan Year for which a Discretionary Contribution is made, due to retirement,
death or Disability, and who is otherwise eligible to receive an allocation of a
Discretionary Contribution, shall receive an allocation of the Discretionary
Contribution for such Plan Year.

 

(b)            Discretionary Contributions:  Integrated Allocation.  If
specified in the Adoption Agreement, a Discretionary Contribution, if any, shall
be allocated to each Participant’s Account, except as provided in Section
9.04(a), in a dollar amount equal to 5.7% of the sum of each Participant’s total
Compensation plus Excess Compensation.  “Excess Compensation” means, with
respect to a Plan that is integrated with Social Security, a

 

45

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Participant’s Compensation which is in excess of the amount set forth in the
Adoption Agreement.  If the Employer does not contribute such amount for all
Participants, each Participant will be allocated a share of the contribution in
the same proportion that his/her total Compensation plus his/her total Excess
Compensation for the Plan Year bears to the total Compensation plus the total
Excess Compensation of all Participants for the year.  For purposes of this
subsection (b), “Taxable Wage Base” shall mean, with respect to any year, the
minimum amount of earnings which may be considered wages for such year under
Code section 3121(a)(1).

 

Notwithstanding the preceding, 4.3% shall be substituted for 5.7% above if
Excess Compensation is based on more than 20% and less than or equal to 80% of
the Taxable Wage Base.  If Excess Compensation is based on less than 100% and
more than 80% of the Taxable Wage Base, then 5.4% shall be substituted for 5.7%
above.  The percentage of the Taxable Wage Base which shall be the basis for
determining Excess Compensation shall be specified in the Adoption Agreement.

 

(1)  The balance of the Discretionary Contribution over the amount allocated
above, if any, shall be allocated to each Participant’s Account in the same
proportion that his/her total Compensation for the year bears to the total
Compensation of all Participants for such year.

 

(2)  Except, however, for any Plan Year beginning prior to January 1, 1990, and
if elected in the Adoption Agreement for any Plan Year beginning on or after
January 1, 1990, a Participant who performs less than a Year of Service during
any Plan Year shall not share in the Discretionary Contribution for that year,
unless there is a short Plan Year (a Plan Year of less than twelve (12)
consecutive months) or a contribution is required pursuant to Section 9.04(a).

 

(c)            Discretionary Contributions: Allocation Based on Cross-Testing.
  If specified in the Adoption Agreement that the Plan is to utilize
cross-testing as described in Section 1.401(a)(4)-8 of the Income Tax
Regulations, Employer contributions shall be allocated to each Participant’s
Account in accordance with the following rules:

 

(i)            All Participants in the Plan shall be classified as belonging to
an Allocation Tier specified in the Adoption Agreement.  Each of the Allocation
Tiers shall receive a definite, designated  portion of each Employer
contribution.

 

(ii)           Prior to making any Employer contribution, the Employer shall
designate in a written instrument the amount of such Employer contribution to be
allocated to each Allocation Tier.  Each of these written documents shall be
signed by an authorized representative of the Employer, and shall be kept as
part of the permanent records of the Plan.

 

(iii)          The amount of the Employer contribution designated as belonging
to each Allocation Tier shall be allocated among the Participants in such
Allocation Tier by multiplying such amount by a fraction, the numerator of which
is the Compensation

 

46

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of each Participant in the Allocation Tier and the denominator of which is the
aggregate of the Compensation of all Participants in such Allocation Tier.

 

(iv)          Alternatively, if elected in the Adoption Agreement, the amount of
the Employer contribution to each Allocation Tier shall be allocated equally
among the Participants in such Allocation Tier.

 

(v)           In the event the Plan is a Top-Heavy Plan for the Plan Year, then
notwithstanding the foregoing, the Employer contribution shall be allocated so
as to satisfy the minimum contribution allocation requirements as set forth in
Plan Section 9.04.

 

(vi)          Except to the extent otherwise elected by the Employer in the
Adoption Agreement, only those Participants who have completed a Year of Service
during the Plan Year and who are employed on the last day of the Plan Year shall
share in the allocation of Discretionary Contributions for such Plan Year. 
Unless otherwise elected in the Adoption Agreement, the preceding sentence
notwithstanding, a Participant who has Separated from Service, during the Plan
Year for which a Discretionary Contribution is made, due to retirement, death or
Disability, and who is otherwise eligible to receive an allocation of a
Discretionary Contribution, shall receive an allocation of the Discretionary
Contribution for such Plan Year.

 

(d)           Salary Deferral Contributions.  Salary Deferral Contributions
shall be allocated to the Salary Deferral Account of each Participant as of each
Valuation Date.

 

(e)           Matching Contributions.   If the Employer elects to make Matching
Contributions, all such Contributions shall be allocated to the Employer
Matching Account of such Participant as of each Valuation Date, or as of such
other date or period as specified in the Adoption Agreement.  A Participant who
has made a Salary Deferral Contribution or a  Nondeductible Employee
Contribution and who has Separated from Service, during a Plan Year for which
the Employer has made a Matching Contribution, due to retirement, death or
Disability, shall be eligible to receive an allocation of Matching Contributions
notwithstanding that such Participant would otherwise not be eligible to receive
such an allocation by reason of his or her failure to complete the minimum
Service requirements or failure to be employed on the last day of such Plan
Year.

 

(f)            Forfeitures.

 

(1)  As of each Valuation Date Forfeitures shall first be used, when necessary,
to restore Forfeitures to the Accounts of any Participants qualified for such
restoration and then shall be used for the Plan Year in which such Forfeitures
occur and as provided for in the Adoption Agreement.

 

(2)  If specified in the Adoption Agreement, as of each Anniversary Date any
amounts which became Forfeitures since the last Anniversary Date, and which have
not been used to reinstate previously forfeited Account Balances, if any, shall
be used to satisfy Plan expenses as follows.  All expenses incident to the
administration, termination or

 

47

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protection of the Plan and Trust, including, but not limited to, actuarial,
legal, accounting, administration, management, and Trustee’s fees, shall be paid
out of the remaining Forfeitures.  If the Forfeitures are insufficient to pay
for such expenses, any remaining liabilities, may, at the Employer’s sole
discretion, be paid by the Employer. For the convenience and the facilitation of
the administration of the Plan, the Employer may pay any such expenses and be
reimbursed for those expenses out of Forfeitures, to the extent that Forfeitures
are available and to the extent that such expenses (as non-settlor functions)
are permitted, by the Department of Labor, to be reimbursed in such manner.

 

(3)  Unless otherwise specified in the Adoption Agreement, the remaining
Forfeitures attributable to Matching Contributions, if any, shall only be
allocated to Participants who made a Salary Deferral Election and one or more
Salary Deferral Contributions for the applicable Plan Year, and who were
employed with the Employer on the last day of the applicable Plan Year, and
shall be allocated according to the following method:

 

(A)  The Forfeitures shall be used to reduce the Matching Contribution of the
Employer hereunder for the Plan Year in which such Forfeitures occur.

 

(4)  Unless otherwise specified in the Adoption Agreement, the remaining
Forfeitures attributable to Discretionary Contributions, if any, shall only be
allocated to those Participants who have completed a Year of Service during the
Plan Year and who are employed on the last day of the Plan Year, and shall be
allocated according to one of the following methods (A, B, or C below), as
specified in the Adoption Agreement.

 

(A)  The Forfeitures shall be used to reduce the Discretionary Contribution of
the Employer hereunder for the Plan Year in which such Forfeitures occur.

 

(B)  Forfeitures shall be allocated among eligible Nonhighly Compensated
Participants in accordance with the allocation formula for Discretionary
Contributions.

 

(C)  Forfeitures shall be allocated among eligible Participants in accordance
with the allocation formula for Discretionary Contributions.

 

Forfeitures allocated under subparagraph (B), and (C) shall be allocated once a
year as of the Anniversary Date of the Plan Year, unless otherwise specified in
the Adoption Agreement.

 

(5) If specified in the Adoption Agreement, Forfeitures, without regard to
whether attributable to Matching Contributions or Discretionary Contributions,
shall be used to reduce any current or future Employer contributions.

 

(6) If specified in the Adoption Agreement, Forfeitures, without regard to
whether attributable to Matching Contributions or Discretionary Contributions,
shall be allocated among eligible Participants who are credited with one (1)
Year of Service and who are employed with the Employer on the last day of the
Plan Year, on the basis that

 

48

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each such eligible Participant’s Total Account Balance bears to the Total
Account Balances of all eligible Participants.

 

(7)  If specified in the Adoption Agreement, Forfeitures, without regard to
whether attributable to Matching Contributions or Discretionary Contributions,
shall be allocated among eligible Participants who are credited with one (1)
Year of Service and who are employed with the Employer on the last day of the
Plan Year, on the basis that each such eligible Participant’s Compensation bears
to the total Compensation of all eligible Participants.

 

Forfeitures allocated pursuant to paragraphs (6) and (7) above, shall be
allocated once each Plan Year as of the Anniversary Date of a Plan Year.

 

(g)           Additional Allocations. Unless specified otherwise in the Adoption
Agreement, in the event that the allocations made pursuant to subsections (a),
(b), (c), (e) or (f) of this Section 4.06, would result in a failure to satisfy
the requirements of Code section 410(b), or of the regulations thereunder, the
Plan Administrator may determine that an additional number of Nonhighly
Compensated Employees shall be eligible to share in the allocation made under
such subsections.  Such additional number of such Nonhighly Compensated
Employees shall be the minimum number necessary to enable the Plan to qualify
under Code section 410(b).  Such additional Nonhighly Compensated Employees who
shall be eligible to share in such allocation shall be selected in the following
order:

 

(1)  first, from among such Participants who were employed on the last day of
the Plan Year and who failed to complete a Year of Service in the Plan Year;

 

(2)  then, from among such Participants who were not employed on the last day of
the Plan Year, ranked in order of those who have completed the largest number of
Hours of Service.

 

49

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ARTICLE V. LIMITATIONS ON ALLOCATIONS.

 

5.01.       Participants Covered by this Plan Only.

 

(a)           In general.  If a Participant does not participate in, and has
never participated in another qualified plan, or a welfare benefit fund as
defined in Code section 419(e), maintained by the Employer, or an individual
medical account, as defined in Code section 415(l)(2), maintained by the
Employer, which provides an Annual Addition, the total amount of Annual
Additions which may be credited to the Participant’s Account for any Limitation
Year shall not exceed the lesser of the Maximum Permissible Amount or any other
limitation contained in this Plan.

 

If the Employer contribution that would otherwise be contributed or allocated to
a Participant’s Account would cause the Annual Additions for the Limitation Year
to exceed the Maximum Permissible Amount, the amount contributed or allocated
shall be reduced so that the Annual Additions for the Limitation Year will equal
the Maximum Permissible Amount.

 

(b)           Calculation of Maximum Permissible Amount. Prior to determining a
Participant’s 415(c) Compensation for the Limitation Year, the Employer may
determine the Maximum Permissible Amount for a Participant on the basis of a
reasonable estimation of the Participant’s 415(c) Compensation for the
Limitation Year, uniformly determined for all Participants 415(c) Compensation
for the Limitation Year. As soon as administratively feasible after the end of
the Limitation Year, the Maximum Permissible Amount for the Limitation Year
shall be determined on the basis of the Participant’s 415(c) Compensation for
the Limitation Year.

 

5.02.       More than One Plan.

 

(a)            Two or more defined contribution plans. This subsection (a)
applies if, in addition to this Plan, a Participant is covered under another
qualified defined contribution plan (whether or not terminated) maintained by
the Employer for the current and all prior Limitation Years.  For this purpose,
another qualified defined contribution plan shall include the Annual Additions
attributable to a Participant’s Nondeductible Employee Contributions to all
defined benefit plans (whether or not terminated) maintained by the Employer,
and the Annual Additions attributable to all welfare benefit funds (as defined
in Code section 419(e)) maintained by the Employer, and an individual medical
account (as defined in Code section 415(l)(2)) maintained by the Employer, which
provides an Annual Addition during any Limitation Year.

 

The maximum aggregate amount in any Limitation Year is the lesser of 125 percent
of the dollar limitation determined under Code sections 415(b) and (d) in effect
under Code section 415(c)(1)(A) or 35 percent of the Participant’s 415(c)
Compensation for such Year.

 

(1)  If a Participant participates in more than one defined contribution plan
maintained by the Employer which have different Anniversary Dates, the Maximum
Permissible

 

50

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Amount under this Plan shall equal the maximum Annual Additions for the
Limitation Year minus any Annual Additions previously credited to such
Participant’s Accounts during the Limitation Year.

 

(2)  If a Participant participates in both a defined contribution plan subject
to Code section 412 and a defined contribution plan not subject to Code section
412 maintained by the Employer which have the same Anniversary Date, Annual
Additions shall be credited to the Participant’s Accounts under the defined
contribution plan subject to Code section 412 prior to crediting Annual
Additions to the Participant’s Accounts under the defined contribution plan not
subject to Code section 412.

 

(3)  If a Participant participates in more than one defined contribution plan
not subject to Code section 412 maintained by the Employer which have the same
Anniversary Date, the maximum Annual Additions under this Plan shall equal the
product of:

 

(A)  the maximum Annual Additions for the Limitation Year minus any Annual
Additions previously credited under (1) or (2) above, multiplied by

 

(B)  a fraction, the numerator of which is the Annual Additions which would be
credited to such Participant’s Accounts under this Plan without regard to the
limitations of Code section 415 and the denominator of which is such Annual
Additions for all plans described in this paragraph.

 

Note: (b) through (g) below do not apply to Limitation Years beginning after
December 31, 1999.

 

(b)            Defined benefit plans.  Subject to the exception given below, if
an Employee is (or has been) a Participant in one or more defined benefit plans
and one or more defined contribution plans maintained by the Employer, the sum
of the defined benefit plan fraction and the defined contribution plan fraction
for any Limitation Year may not exceed 1.0.

 

(c)            Defined benefit plan franction.  The defined benefit plan
fraction is determined as follows:

 

(1)  The defined benefit plan fraction for any Limitation Year is a fraction (A)
the numerator of which is the Projected Annual Benefit of the Participant under
all defined benefit plans (whether or not terminated) maintained by the Employer
(determined as of the close of the Limitation Year), and (B) the denominator of
which is the lesser of: (i) the product of 1.25 multiplied by the maximum dollar
limitation provided under Code section 415(b)(1)(A) for such Limitation Year, or
(ii) the product of 1.4 multiplied by the amount (the highest average
Compensation, including any adjustments) which may be taken into account under
Code section 415(b)(1)(B) for such Limitation Year.

 

(2)  For purposes of applying the limitations of Code section 415, the Projected
Annual Benefit for any Participant is the benefit, payable annually, under the
terms of the Plan determined pursuant to Regulations section 1.415-7(b)(3).

 

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(3)  For purposes of applying the limitations of Code section 415, the projected
current accrued benefit for any Participant in a Defined Benefit Plan in
existence on July 1, 1982, shall be the accrued benefit, payable annually,
provided for under question T-3 of Internal Revenue Service Notice 83-10.

 

(4)  Notwithstanding (1) above, if a Participant was a Participant as of the
first day of the first Limitation Year beginning after December 31, 1986, in one
or more defined benefit plans maintained by the Employer which were in existence
on May 6, 1986, the denominator of this fraction shall not be less than 1.25 of
the sum of the annual benefits under such plans which the Participant had
accrued as of the close of the last Limitation Year beginning before January 1,
1987, disregarding any changes in the terms and conditions of such plan after
May 5, 1986.  The preceding sentence shall apply only if the defined benefit
plans individually and in the aggregate satisfied the requirements of Code
section 415 for all Limitation Years beginning before January 1, 1987.

 

(5)  For purposes of this subsection (c) Projected Annual Benefit means the
annual retirement benefit (adjusted to an actuarially equivalent straight life
annuity, if such benefit is expressed in a form other than a straight life
annuity, or qualified joint and survivor annuity) to which the Participant would
be entitled under the terms of the plan assuming: (A) the Participant shall
continue employment until the normal retirement age provided under such plan (or
the current age, if later), and (B) the Participant’s 415 Compensation for the
current Limitation Year, and all other relevant factors used to determine
benefits under such plan shall remain constant for all future Limitation Years.

 

(d)            Defined contribution plan fraction.  The defined contribution
plan fraction is determined as follows:

 

(1)  The defined contribution plan fraction for any Limitation Year is a
fraction of:

 

(A)  the numerator of which is the sum of all Annual Additions to the
Participant’s Accounts as of the close of the Limitation Year; and

 

(B)  the denominator of which is the sum of the lesser of the following amounts
determined for such year and each prior Year of Service with the Employer:

 

(i)  the product of 1.25 multiplied by the dollar limitation in effect under
Code section 415(c)(1)(A) for such Limitation Year (determined without regard to
Code section 415(c)(6)); or

 

(ii)  the product of 1.4 multiplied by the amount which may be taken into
account under Code section 415(c)(1)(B) for such Limitation Year.

 

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(2)  Notwithstanding the foregoing, the numerator of the defined contribution
plan fraction shall be adjusted pursuant to Regulations section 1.415-7(d)(1)
and questions T-6 and T-7 of the Internal Revenue Service Notice 83-10.

 

(3)  For defined contribution plans in effect on or before July 1, 1982, the
Plan Administrator may elect for any Limitation Year ending after December 31,
1982, that the amount taken into account in the denominator for every
Participant for all Limitation Years ending before January 1, 1983, shall be an
amount equal to the product of  (A) the denominator for the Limitation Year
ending in 1982 determined under the law in effect for the Limitation Year ending
in 1982 multiplied by (B) the transition fraction.

 

(4)  For purposes of the preceding paragraph, the term transition fraction shall
mean a fraction (A) the numerator of which is the lesser of (1) $51,875, or (2)
1.4 multiplied by 25% of the Participant’s 415(c) Compensation for the
Limitation Year ending in 1981, and (B) the denominator of which is the lesser
of (1) $41,500 or (2) 25% of the Participant’s 415(c) Compensation for the
Limitation Year ending in 1981.

 

(5)  Notwithstanding the foregoing, for any Limitation Year in which the Plan is
a Top-Heavy Plan (as determined under Section 9.02), $41,500 shall be
substituted for $51,875 in determining the transition fraction unless an extra
minimum allocation is being provided pursuant to this Plan being found to be
Top-Heavy. However, for any Limitation Year in which this Plan is a
Super-Top-Heavy Plan, $41,500 shall be substituted for $51,875 in any event.

 

(6)  If an Employee was a Participant as of the end of the first day of the
first Limitation Year beginning after December 31, 1986, in one or more defined
contribution plans maintained by the Employer which were in existence on May 6,
1986, the numerator of this fraction shall be adjusted if the sum of this
fraction and the defined benefit fraction would otherwise exceed 1.0 under the
terms of this Plan. Under the adjustment, an amount equal to the product of (1)
the excess of the sum of the fractions over 1.0 times (2) the denominator of
this fraction, shall be permanently subtracted from the numerator of this
fraction.  The adjustment is calculated using the fractions as they would be
computed as of the end of the last Limitation Year beginning before January 1,
1987, and disregarding any changes in the terms and conditions of the Plan made
after May 5, 1986, but using the Code section 415 limitation applicable to the
first Limitation Year beginning on or after January 1, 1987.

 

The Annual Addition for any Limitation Year beginning before January 1, 1987,
shall not be recomputed to treat all Employee contributions as Annual Additions.

 

(7)  Defined Contribution Dollar Limitation:  $30,000 or such larger amount as
may be determined by the Commissioner of the Internal Revenue Service for the
Limitation Year.  For Limitation Years prior to January 1, 1995:  $30,000 or if
greater, one-fourth of the defined benefit dollar limitation set forth in Code
section 415(b)(1), as in effect for the Limitation Year.

 

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(e)           Top-Heavy rule.  Notwithstanding the foregoing for any Limitation
Year in which the Plan is a Top-Heavy Plan, 1.0 shall be substituted for 1.25 in
subsection (d)(1)(B)(i) above.

 

(f)            Limiting Annual Additions.  If the sum of the defined benefit
plan fraction and the defined contribution plan fraction shall exceed 1.0 in any
Limitation Year for any Participant in this Plan for reasons other than
described in (h) below, the Plan Administrator shall limit, to the extent
necessary, the Annual Additions to such Participant’s Accounts for such
Limitation Year.  If, after limiting the Annual Additions to such Participant’s
Accounts for the Limitation Year, the sum of the defined benefit plan fraction
and the defined contribution plan fraction still exceed 1.0, the Plan
Administrator shall then adjust the numerator of the defined benefit plan
fraction so that the sum of both fractions shall not exceed 1.0 in any
Limitation Year.

 

(g)            Other limitations.  If

 

(1)  the substitution of 1.0 for 1.25 and $41,500 for $51,875 above, or

 

(2)  the excess benefit accruals or Annual Additions provided for in Internal
Revenue Service Notice 82-19 cause the 1.0 limitation to be exceeded for any
Participant in any Limitation Year, such Participant shall be subject to the
following restrictions for each future Limitation Year until the 1.0 limitation
is satisfied:

 

(A)  The Participant’s accrued benefit under the defined benefit plan shall not
increase;

 

(B)  no Annual Additions may be credited to a Participant’s Accounts; and

 

(C)  no Employee Contributions (voluntary or mandatory) shall be made under any
defined benefit plan or any defined contribution plan of the Employer.

 

(h)           Rules shall comply with Code section 415.  Notwithstanding
anything contained in this Section to the contrary, the limitations, adjustments
and other requirements prescribed in this Section shall at all times comply with
the provisions of Code section 415 and the Regulations thereunder, the terms of
which are specifically incorporated herein by reference for Plan Years beginning
after December 31, 1999.

 

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ARTICLE VI. VESTING.

 

6.01.       Employer Account Vesting Schedule.  Prior to attaining Normal
Retirement Age, a Participant’s Vested Balance in the amounts credited to his
Employer Account shall be determined in accordance with the vesting schedule
specified in the Adoption Agreement. Notwithstanding the preceding sentence, in
Top-Heavy Plan Years, a Participant’s Vested Balance in his Employer Account
shall be determined pursuant to the vesting schedule under Section 9.03 of the
Plan.

 

6.02.       Vesting Computation Method

 

(a)           In general.  If Breaks-in-Service and Years of Service are
calculated under the 1,000 Hour Method, then for vesting purposes an Employee
shall be credited with a Year of Service for each Plan Year in which the
Employee completes 1,000 or more Hours of Service.

 

If Breaks-in-Service and Years of Service are calculated under the Elapsed Time
Method, then for vesting purposes an Employee shall be credited with a Year of
Service for each 12-consecutive months of Service, which begins on the
employment commencement date.

 

(b)           Change In Computation Period.  In the event that the Plan Year is
the vesting computation period and the Plan is amended to change the Plan Year
(the vesting computation period) to a different 12-consecutive month period, the
first vesting computation period established under such amendment shall begin
before the last day of the preceding vesting computation period.  A Participant
who is credited with 1,000 Hours of Service in both the vesting computation
period under the Plan before such amendment, and in the first vesting
computation period under the Plan after such amendment, shall be credited with
two (2) Years of Service for vesting computation purposes.

 

6.03.       Years of Service.  Years of Service with an Affiliate and Years of
Service with an Employer whose Plan is merged with this Plan (unless otherwise
provided in the Adoption Agreement), shall be counted for vesting purposes,
unless excluded hereunder.

 

In computing periods of Service for purposes of vesting, all Years of Service
shall be counted, except as follows (unless such Service is specifically
credited pursuant to the Adoption Agreement):

 

(a)           If a Former Participant has a one-year Break-in-Service, his
pre-break and post-break Service shall be used for computing Years of Service
for vesting purposes only after he has been employed for one (1) Year of Service
following the date of his reemployment;

 

(b)           Any Former Participant who under the Plan does not have a
nonforfeitable right to any interest in the Plan resulting from Employer
contributions shall lose credits otherwise allowable under (a) above if his
consecutive one-year Breaks-in-Service equal or exceed the greater of five (5)
Breaks-in-Service or the aggregate number of his pre-break Years of Service;

 

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(c)           After five (5) consecutive one-year Breaks-in-Service, a Former
Participant’s Vested Balance attributable to pre-break Service shall not be
increased as a result of post-break Service;

 

(d)           Years of Service before Age 18;

 

(e)           Years of Service before the Employer maintained this Plan or a
predecessor plan.

 

6.04.       Amendment of Vesting Schedule.

 

(a)           In general.  No amendment shall, directly or indirectly, decrease
(but may increase) a Participant’s Vested Balance in his Employer Account,
determined as of the later of the date the amendment is adopted, or the date
such amendment is effective. If the vesting schedule of the Plan is amended, or
the Plan is amended in any way that directly or indirectly affects the
computation of the vested interest of Participants (or if the Plan is deemed
amended by an automatic change to or from a Top-Heavy vesting schedule), each
Participant with at least three (3) Years of Service with the Employer may
elect, within a reasonable period after the adoption of the amendment, to have
his Vested Balance computed under the Plan without regard to such amendment.

 

(b)           Election Period.  The period during which the election, provided
for in (a) above, may be made shall commence with the date the amendment is
adopted or deemed to be made, and shall end on the latest of:

 

(1)  sixty (60) days after the amendment is adopted;

 

(2)  sixty (60) days after the amendment becomes effective; or

 

(3)  sixty (60) days after a Participant is issued written notice of the
amendment by the Employer or Plan Administrator.

 

Notwithstanding any vesting schedule specified in the Adoption Agreement, if
this is an amendment and restatement of the Plan, then the vested percentage of
a Participant’s Discretionary Account or Matching Account shall not be less than
the vested percentage attained for the Discretionary Account or Matching
Account, as applicable, as of the later of the effective date or adoption date
of this amendment and restatement.

 

6.05.       Other Accounts Fully Vested.  The amounts credited to a
Participant’s Salary Deferral Account, Nondeductible Employee Account, and
Rollover Account shall always be 100% vested and nonforfeitable.

 

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ARTICLE VII. BENEFITS AND DISTRIBUTIONS

 

7.01.       Application of Provisions.  Except as otherwise provided in Article
VIII, if applicable, the requirements of this Article shall apply to any
distribution of a Participant’s Vested Balance in his Accounts.  In the event
that the provisions of Article VIII shall apply, as specified in the Adoption
Agreement, a Participant shall be required to obtain the consent of his or her
Spouse prior to obtaining a distribution from the Plan.  Such consent shall be
in the form of a Qualified Election.  In the event that the provisions of
Article VIII shall not apply, as specified in the Adoption Agreement, a
Participant shall not be required to obtain the consent of his or her Spouse
prior to obtaining a distribution from the Plan, unless the Adoption Agreement
specifically provides otherwise.  If such consent is required, such consent
shall be in writing and shall be witnessed by a representative of the Plan or by
a notary public.

 

7.02.       Normal Retirement Benefits.  When a Participant attains his Normal
Retirement Age, he shall be 100% vested in his Employer Accounts. Upon a
Participant’s termination of Service on or after attaining his Normal Retirement
Age, his Vested Balance shall be payable to him pursuant to the provisions of
this Article VII and Article VIII, if applicable.

 

7.03.       Termination Benefit Prior to Normal Retirement.

 

(a)           General Rule.  Upon a Participant’s Severance from Employment (for
reasons other than death or Disability) prior to his attaining Normal Retirement
Age or Early Retirement Age (unless the Adoption Agreement specifically does not
provide for an Early Retirement Age), his Vested Balance in his Accounts shall
be payable in accordance with Section 7.07 and in the manner provided in Section
7.08 and the Adoption Agreement. Subject to the provisions of subsection (b), a
Participant’s Forfeiture, if any, shall be maintained in his Employer Account
and shall be held in the Trust as uninvested cash until it is reallocated in
accordance with Section 4.06(f).

 

(b)                                  Miscellaneous provisions.

 

(1)  If a Participant Separates from Service and elects (under a Qualified
Election, or if a Qualified Election is not applicable, in the same manner as a
Qualified Election) to receive payment of his entire Vested Balance, the amount
subject to Forfeiture shall be the remaining balance in such Account. If the
Participant elects (under a Qualified Election, or if a Qualified Election is
not applicable, in the same manner as a Qualified Election) to have distributed
less than his entire Vested Balance, the part of the non-vested portion which
shall be subject to Forfeiture is the total non-vested portion multiplied by a
fraction, the numerator of which is the amount of the distribution from the
Employer Account and the denominator of which is the total value of the Employer
Account of such Participant.

 

(2)  If the value of the Vested benefit of a Participant who has Separated from
Service does not exceed $5,000 ($3,500 for Plan Years prior to January 1, 1998),
the Plan Administrator shall direct the Trustee to cause the entire vested
benefit to be paid to such Participant in a single lump sum.

 

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(3)  If a Participant Separates from Service, there shall be no distribution of
any benefits where the present value of the nonforfeitable accrued benefit
(taking into consideration benefits derived from both Employer and Employee
contributions) is in excess of $5,000 ($3,500 for Plan Years prior to January 1,
1998) without the consent of the Participant and, when applicable, the consent
of the Participant’s Spouse.  The consent of a Participant’s Spouse shall be
required if either the provisions of Article VIII are applicable or if such
spousal consent is otherwise specifically required, as set forth in the Adoption
Agreement.

 

(4) If any Former Participant shall be reemployed by the Employer before
incurring five (5) consecutive one-year Breaks-in-Service, and such Former
Participant had received, or was deemed to have received, a distribution of his
entire Vested Balance prior to his reemployment, his forfeited Account shall be
reinstated only if he repays the full amount distributed to him before the
earlier of five (5) years after the first date on which the Participant is
subsequently reemployed by the Employer, or the date the Participant incurs five
(5) consecutive one-year Breaks-in-Service following the date of distribution.
If an Employee is deemed to receive a distribution pursuant to a cash-out where
such Participant has a vested percentage of zero percent (0%), and such
Participant resumes employment covered under this Plan before the date such
Participant incurs five (5) consecutive one-year Breaks-in-Service, upon the
reemployment of such Former Participant, the Employer-derived Account balance of
such Former Participant shall be restored to the amount on the date of such
deemed distribution.  If a distribution occurs for any reason other than a
Severance from Employment, the time for repayment may not end earlier than five
(5) years after the date of separation.

 

(5) In the event the Former Participant does repay the full amount distributed
to him, or in the event of a deemed distribution, the undistributed portion of
the Participant’s Account must be restored in full, unadjusted by any gains or
losses occurring subsequent to the Anniversary Date or other valuation date
coinciding with or preceding his termination.

 

(A)  The source for such reinstatement shall first be from any Forfeitures
occurring during the year (or from a prior year).  If such source is
insufficient, then the Employer shall contribute an amount which is sufficient
to restore any such forfeited amounts provided, however, that if a Discretionary
Contribution is made for such year pursuant to Section 3.01, such contribution
shall first be applied to restore any such Accounts and the remainder shall be
allocated in accordance with Section 4.06(f).

 

(B)  With respect to the repayment amount, the Plan Administrator shall make a
determination as to what portion of the repayment amount remains tax-deferred,
and what portion has been subject to federal income tax.  The Plan Administrator
shall establish an appropriate account for the returned distribution, designated
as a returned distribution, by source, and by tax status.

 

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7.04.       Disability Benefits.

 

(a)           In general. Unless the Employer elects otherwise in the Adoption
Agreement disability benefits shall be provided prior to a Participant’s Normal
Retirement Age by reason of such Participant’s Disability. Accordingly, upon a
determination of a Participant’s Disability by the Plan Administrator, a
Participant’s vested percentage in his Employer Account shall be 100% and the
Vested Balance shall be payable to such Participant pursuant to this Article VII
and Article VIII, if applicable.

 

(b)           Determination of Disability. The Plan Administrator shall require
a Participant to establish that he or she is disabled in order to obtain a
distribution under the Plan by reason of such Disability.  The Adoption
Agreement shall specify the evidence which a Participant shall be required to
provide to the Plan Administrator in order to establish Disability.  The
Adoption Agreement shall specify which of the following shall apply:

 

(1) A Participant shall furnish to the Plan Administrator evidence that the
federal Social Security Administration has determined that the Participant is
eligible to receive total disability benefits under the federal Social Security
Act; or

 

(2) A Participant shall furnish to the Plan Administrator certification of such
Disability from a licensed doctor of medicine on a form to be provided by the
Plan Administrator; or

 

(3) A Participant shall furnish to the Plan Administrator certification of such
Disability, obtained separately from at least two licensed doctors of medicine,
on a form provided by the Plan Administrator; or

 

(4) A Participant shall be required to obtain a certification of such Disability
from one or more licensed doctors of medicine.  The Employer shall designate the
doctor or doctors from whom the Participant shall obtain such certification.  In
the event that the Participant is required to obtain such certification of
Disability from a doctor or doctors designated by the Employer, the Employer
shall bear the cost incurred by obtaining such certification by such doctor or
doctors.

 

The preceding notwithstanding, the Adoption Agreement may specify a type or
degree of certification required to establish a Disability other than those
stated in (1) through (4) above.  In the event the Adoption Agreement does not
specify the type or degree of certification required to establish a Disability,
paragraph (1) above shall apply.

 

7.05.       Death Benefits.

 

(a)           Full Vesting. Upon the death of any Participant while in Service,
his vested percentage in his Employer Account shall be 100% and his Vested
Balance along with any Death Benefit due to the Trust as a result of the
Participant’s death shall be payable to the Participant’s Surviving Spouse or,
if the Surviving Spouse consents, or if there is not a Surviving Spouse, to a
designated Beneficiary of the Participant. Such payment is to be made pursuant
to the provisions of Article VIII, if applicable.

 

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A Participant may waive the benefits, otherwise payable hereunder to such
Participant’s Surviving Spouse, at any time, provided that no such waiver shall
be effective unless it satisfies the conditions of a Qualified Election made
pursuant to Section 8.03(f) (other than the notification requirements referred
to therein) that would apply to a Participant’s waiver of the Qualified
Pre-retirement Survivor Annuity.

 

(b)           Payable to Beneficiary. Upon the death of any Participant after
Severance from Employment, the remaining amounts in his Accounts which were
vested at the time of his termination shall be payable to his Beneficiary.

 

(c)           Death after distribution of balance. If the Participant dies after
distribution of his Vested Balance has commenced, the remaining portion of such
Vested Balance shall continue to be distributed at least as rapidly as under the
method of distribution being used prior to the Participant’s death.

 

(d)           Death before distribution of balance. If the Participant dies
before distribution of his Vested Balance commences, the Participant’s entire
Vested Balance shall be completely distributed by December 31 of the calendar
year containing the fifth (5th) anniversary of the Participant’s death except to
the extent that an election is made to receive distributions in accordance with
(1) or (2) below:

 

(1) If any portion of the Participant’s Vested Balance is payable to a
designated Beneficiary, distributions may be made over the life of the
designated Beneficiary or over a period certain not greater than the life
expectancy of the designated Beneficiary, if permitted under the Adoption
Agreement, commencing on or before December 31 of the calendar year immediately
following the calendar year in which the Participant died; or

 

(2) If the designated Beneficiary is the Participant’s Surviving Spouse, the
date distributions are required to begin in accordance with (1) above shall not
be earlier than the later of: (i) December 31 of the calendar year immediately
following the calendar year in which the Participant died, or (ii) December 31
of the calendar year in which the Participant would have attained age 70 1/2.

 

(e)           Calculation of payments. For purposes of (d) above, payments shall
be calculated by use of the return multiples specified in Tables V and VI of
Regulations section 1.72-9 and in accordance with Proposed Regulations sections
1.401(a)(9)-1 and 1.401(a)(9)-2.

 

For the purpose of this Section 7.05, distribution of a Participant’s interest
is considered to begin on the Participant’s Required Beginning Date (as defined
in Section 7.07(b)), or if subsection (d) above is applicable, the date
distribution is required to begin to the Surviving Spouse pursuant to subsection
(g) below.  If distribution in the form of an annuity irrevocably commences to
the Participant before the Required Beginning Date, the date distribution is
considered to begin is the date distribution actually commences.

 

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(f)            Payment to a child of the Participant. For purposes of paragraphs
(c), (d) and (e), any amount paid to a child of the Participant shall be treated
as if it had been paid to the Surviving Spouse if the amount becomes payable to
the Surviving Spouse when the child reaches the age of majority.

 

(g)           Miscellaneous. Upon the death of any Participant, the Surviving
Spouse can direct the commencement of benefits 60 days after the end of the Plan
Year in which the death occurred.

 

Where an amount is distributable under subsection (d) above, the Beneficiary
must elect the method of distribution no later than the earlier of:

 

(1) December 31 of the calendar year in which distributions would be required to
begin under subsection (d) above, or

 

(2) December 31 of the calendar year which contains the fifth (5th) anniversary
of the date of death of the Participant.

 

If the Participant has no designated Beneficiary, or if the designated
Beneficiary does not elect a method of distribution, distribution of the
Participant’s entire interest must be completed by December 31 of the calendar
year containing the fifth (5th) anniversary of the Participant’s death.

 

If the Participant dies without a designated Beneficiary surviving such
Participant, the Participant’s entire interest shall be paid to such
Participant’s estate.

 

7.06.       Certification of Severance from Employment.  The Plan Administrator
shall certify to the Trustee the fact of Severance from Employment of a
Participant, and the amounts due from his Accounts.

 

7.07.       Commencement of Benefits.

 

(a)           In general. Upon a Participant’s entitlement to a distribution of
benefits under Section 7.02, 7.03, 7.04, 7.05 or 13.08, a Participant shall file
with the Plan Administrator a written election on such form or forms, and
subject to such conditions, as the Plan Administrator shall provide.  A
Participant may elect to receive a distribution of benefits as soon as
administratively practicable.  Such election shall specify whether distribution
of benefits is to begin as soon as administratively feasible, subject to the
Plan’s provisions, or to be deferred to the extent provided below. The Plan
Administrator shall distribute a Participant’s benefit pursuant to such
Participant’s election, provided that, if payments become due for any reason
including retirement at or after age 65, death or Disability, and if the amounts
due from the Participant’s Accounts (including Employer and Employee
Contributions, but not including accumulated deductible Employee Contributions)
are in excess of $5,000 ($3,500 for Plan Years prior to January 1, 1998) payment
of such amounts shall be deferred to the extent provided below unless the
Participant consents in writing to earlier payment. Furthermore, unless
otherwise specified in the Adoption Agreement, this provision shall not be
subject to the provisions of Article VIII, nor shall the consent of a
Participant’s Spouse be required.

 

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(b)           Required minimum distributions. For each Plan Year, a
Participant’s required minimum distributions shall satisfy Code section
401(a)(9) and section 1.401(a)(9) of the Proposed Regulations, which are herein
incorporated by reference.

 

(c)           Provisions take precedence. The provisions set forth in paragraphs
(a) and (b) override any settlement options in the Plan inconsistent with the
above.

 

(d)           Distribution commencement date. Except as limited in paragraphs
(a) and (b) above, the Trustee shall commence benefit payments for all claims
authorized for payment in a Plan Year no later than 60 days following the end of
the applicable Plan Year or as soon thereafter as is practicable, but in no
event later than 180 days after the end of the applicable Plan Year, except
where such delay is required by special circumstances.  Such special
circumstances include the transfer, merger and/or consolidation of assets of
this Plan with another plan, liquidation of assets or surrender of insurance
contracts, the partial or full termination of the Plan, or irregularities
discovered in the books of the Plan as a result of an audit or investigation of
the Plan, or any other unusual circumstances that would cause a prudent man to
delay allocating earnings and losses in the Trust.  Such benefit payments shall
be delayed until the Named Fiduciaries agree that the records and books of the
Plan are in sufficient order and in accordance with generally accepted
accounting practices so that benefit payments can fairly and accurately be
made.  In such matters, the decision of the Named Fiduciaries shall be final,
binding and conclusive.  Furthermore, unless a Participant elects otherwise, and
subject to the limitations in paragraphs (a) and (b), payment of his benefits
under this Plan shall be made or commence no later than the 60th day after the
later of:

 

(1) the end of the year of his 65th birthday; or

 

(2) the end of the year in which his employment terminates. If benefits due from
a Participant’s Accounts are paid as of the date of entitlement to such
benefits, any further amount which may be due from a Participant’s Accounts
shall be paid to the recipient no later than 60 days following the end of the
Plan Year in which Severance from Employment with the Employer occurs.

 

Notwithstanding the preceding, if a Participant elects, he or she shall receive
a distribution as soon as administratively practicable after such Participant
requests a distribution pursuant to Section 7.07(a).

 

(e)           Other rules.  If a distribution is made at a time when a
Participant is not fully vested in his Employer Account and the Participant may
increase the Vested percentage in such Account:

 

(1) a separate Account shall be established for the Participant’s interest in
his Employer Account, as of the time of the distribution; and

 

(2) at any relevant time, the Participant’s vested portion of the separate
Account shall be equal to an amount (“X”) determined by the formula:

 

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X equals P(A plus (R x D)) - (R x D)

 

For purposes of applying the formula: P is the vested percentage at the relevant
time, A is the Account balance at the relevant time, D is the amount of the
distribution, and R is the ratio of the Account balance at the relevant time to
the Account balance after distribution.

 

(f)            Distributions Prior to 30 Day Period.  A distribution, to which
Code sections 401(a)(11) and 417 do not apply, may commence less than thirty
(30) days after the notice required under section 1.411(a)-11(c) of the
Regulations.  Provided, however, that prior to such a distribution:

 

(1) the Plan Administrator shall clearly inform the Participant or Beneficiary
or alternate payee that he or she has the right to a period of at least thirty
(30) days after receiving the notice to consider the decision of whether or not
to elect a distribution (and, if applicable, a particular distribution option),
and

 

(2) the Participant, Beneficiary, or alternate payee, after receiving the notice
affirmatively (by signing a waiver provided by the Plan Administrator) waives
such notice period and elects a distribution.

 

7.08.       Settlement Options.

 

(a)           In general.  Subject to the limitations set forth in the Adoption
Agreement, and subject to a Qualified Election, if the provisions of Article
VIII apply, and subject to the consent of the Participant’s Spouse, if the
Adoption Agreement requires spousal consent, distributions may only be made in
one of the following methods:

 

(1) In a single lump-sum in cash, and if the Participant has an allocated life
insurance contract and so elects, the life insurance contract, and if the Plan
and/or the Participant has invested in Employer stock,  such Employer stock
shall be distributed entirely in cash, and if the Participant has a
self-directed brokerage account and so elects, in kind but only for the
self-directed brokerage account.

 

(2) In the form of a fixed number of annual, semi-annual, quarterly, or monthly
payments in an amount for each Plan Year equal to the value of the Participant’s
Account as of the Anniversary Date of each Plan Year multiplied by a fraction,
the numerator of which is one (1) and the denominator is the number of years (or
applicable period) remaining in such specified period of  payments.  At  the
discretion of the Participant or Beneficiary, and, if required under Article
VIII or the Adoption Agreement, with the consent of the Spouse, the payment of
any benefits as a deferred payment may be accelerated and the unpaid balance may
be distributed to such Participant or Beneficiary in a lump sum. Such payments
shall not exceed the then life expectancy of the Participant or the then life
expectancy of the Beneficiary; provided, however, if the Beneficiary is not the
Spouse of the Participant and the Beneficiary’s life expectancy is greater than
the Participant’s life expectancy, then an amount greater than 50% of the
Participant’s Vested Balance shall be scheduled to be paid within the

 

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Participant’s life expectancy as of the commencement date of such payments.

 

(3)  By the purchase of or providing an annuity.  However, such annuity may not
be in any form that will provide for payments over a period extending beyond
either the life of the Participant (or the lives of the Participant and his
designated Beneficiary) or the life expectancy of the Participant (or the life
expectancy of the Participant and his designated Beneficiary).  Furthermore, all
annuity Contracts under this Plan shall be non-transferable when distributed.
The Terms of any annuity Contract purchased and distributed to a Participant or
Spouse shall comply with all the requirements of the Plan.

 

(b)                                  Plan Administrator Options. The Plan
Administrator may satisfy the election of any annuity or installment option by
the purchase of or providing an annuity.  However, such annuity may not be in
any form that will provide for payments over a period extending beyond either
the life of the Participant (or the lives of the Participant and his designated
Beneficiary) or the life expectancy of the Participant (or the life expectancy
of the Participant and his designated Beneficiary).  Furthermore, all annuity
contracts under this Plan shall be non-transferable when distributed.  The terms
of any annuity contract purchased and distributed to a Participant or Spouse
shall comply with all the requirements of the Plan.

 

(c)                                  Frequency of payments.  Periodic payments
from an annuity shall be made not less frequently than annually.

 

7.09.       Transitional Rules.

 

(a)           In general.  Notwithstanding the other requirements of this
Article, and subject to the requirements of the Adoption Agreement, and of
Article VIII, if applicable, distribution on behalf of any Participant,
including a Five Percent Owner, may be made in accordance with all of the
following requirements (regardless of when such distribution commences).

 

(1) The distribution by the Plan is one which would not have disqualified such
Plan under Code section 401(a)(9) as in effect prior to amendment by the Deficit
Reduction Act of 1984.

 

(2) The distribution is in accordance with a method of distribution designated
by the Participant whose interest in the Plan is being distributed or, if the
Participant is deceased, by a Beneficiary of such Participant.

 

(3) Such designation was in writing, was signed by the Participant or the
Beneficiary, and was made before January 1, 1984.

 

(4) The Participant had a balance in one or more Accounts under the Plan as of
December 31, 1983.

 

(5) The method of distribution designated by the Participant or the Beneficiary
specifies the time at which distributions shall be made, and in the case of any

 

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distribution upon the Participant’s death, the Beneficiaries of the Employee
listed in order of priority.

 

(b)           Distribution upon death.  A distribution upon death of a
Participant shall not be covered by the transitional rule in this Section unless
the information in the designation contains the required information described
above with respect to the distributions to be made upon the death of the
Participant.

 

(c)           Method of distribution.  For any distribution which commenced
before January 1, 1984, but continued after December 31, 1983, the Participant,
or the Beneficiary to whom such distribution is being made, shall be presumed to
have designated the method of distribution under which the distribution is being
made if the method of distribution was specified in writing and the distribution
satisfies the requirements in subparagraphs (a)(1) and (a)(5).

 

(d)           Method of distribution must satisfy Code section 401(a)(9).  If a
designation is revoked, any subsequent distribution must satisfy the requirement
of Code section 401(a)(9), as amended. Any changes in the designation shall be
considered to be a revocation of the designation.  If the designation is revoked
subsequent to the date distributions are required to begin, the Trust must
distribute by the end of the calendar year following the calendar year in which
the revocation occurs, the total amount not yet distributed which would have
been required to have been distributed to satisfy Code section 401(a)(9), and
the proposed regulations thereunder, but for the Code section 242(b)(2)
election. For calendar years beginning after December 31, 1988, but before
January 1, 2002, such distributions must meet the minimum distribution
incidental benefit requirements in section 1.401(a)(9)-2 of the Proposed
Regulations. However, the mere substitution or addition of another Beneficiary
(one not named in the designation) under the designation will not be considered
to be a revocation of the designation, so long as such substitution or addition
does not alter the period over which distributions are to be made under the
designation, directly, or indirectly (for example, by altering the relevant
measuring life). In the case where an amount is transferred or rolled over from
one plan to another plan, the rules in Q&A J-2 and Q&A J-3 of section
1.401(a)(9)-2 of the Proposed Regulations shall apply.

 

7.10.       Presumption of Mental Competency.

 

Each person entitled to a payment hereunder shall be conclusively presumed to be
mentally competent until the date on which the Plan Administrator receives a
written notice in a form satisfactory to the Plan Administrator that such person
is mentally incompetent and that a guardian, conservator or other person legally
vested with the care of his estate has been appointed by a court of competent
jurisdiction.  Payments shall be made to such guardian or conservator of the
estate of the jurisdiction. Any such payment so made shall be a complete
discharge of any liability of the Plan.

 

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7.11.       Financial Hardship Withdrawals.

 

(a)           In general.  A withdrawal can be made on account of financial
hardship only if the withdrawal both is made on account of an immediate and
heavy financial need of the Employee and is necessary to satisfy such financial
need. The Plan Administrator shall determine the existence of an immediate and
heavy financial need and the amount necessary to meet the need, in accordance
with the nondiscriminatory and objective standards set forth in this Section.
The determination of whether an Employee has an immediate and heavy financial
need is to be made on the basis of all relevant facts and circumstances. A
financial need shall not fail to qualify as immediate and heavy merely because
such need was reasonably foreseeable or voluntarily incurred by the Employee.

 

In the event that the provisions of Article VIII shall apply, as specified in
the Adoption Agreement, a Participant shall be required to obtain the consent of
his or her Spouse prior to obtaining a Financial Hardship Withdrawal.  Such
consent shall be in writing and shall be witnessed by a representative of the
Plan or by a notary public.  In the event that the provisions of Article VIII
shall not apply, as specified in the Adoption Agreement, a Participant shall not
be required to obtain the consent of his or her Spouse prior to obtaining a
financial hardship withdrawal unless the Adoption Agreement specifically
requires such consent.

 

(b)           Deemed Financial Hardships.  A withdrawal shall be deemed to be
made on account of an immediate and heavy financial need of the Employee if the
withdrawal is on account of:

 

(1) Expenses for medical and/or dental care described in Code section 213(d)
previously incurred by the Employee, the Employee’s Spouse, or any dependents of
the Employee (as defined in Code section 152) or necessary for these persons to
obtain such medical or dental care as described in Code section 213(d); or

 

(2) Costs directly related to the purchase of a principal residence for the
Employee (excluding mortgage payments); or

 

(3) Payment of tuition, related educational fees, and room and board expenses
for the next 12 months of post-secondary education for the Employee, the
Employee’s Spouse, children, or dependents (as defined in Code section 152); or

 

(4) Payments necessary to prevent the eviction of the Employee from his
principal residence, or foreclosure on the mortgage of the Employee’s principal
residence.

 

The Employee shall be required to submit evidence satisfactory to the Plan
Administrator (such as official third party documents) demonstrating the amount
and nature of the need. Generally, expenses which were incurred more than 12
months prior to the date of the application for a financial hardship withdrawal,
shall not be deemed to be an immediate and heavy financial need.  The amount of
an immediate and heavy financial need may include any amounts necessary to pay
any federal, state or local income taxes or penalties reasonably anticipated to
result from the withdrawal.

 

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(c)           Other Financial Hardships.  Financial hardship withdrawals shall
be limited to the reasons specified in (b) above, unless otherwise specified in
the Adoption Agreement. However, if the Adoption Agreement specifies adoption of
the general rule for determining whether or not an Employee has an immediate and
heavy financial need, then the Plan Administrator shall make a determination
based on all relevant facts and circumstances.  A financial need may be
immediate and heavy even if it was reasonably foreseeable or voluntarily
incurred by the Employee.   Generally, the expenses described in (b) above, and
the expenses incurred because of any of the events described below would be
considered to constitute an immediate and heavy financial need:

 

(1) A natural disaster;

 

(2) Death of a Spouse, a child, or a dependent;

 

(3) Divorce;

 

(4) Birth or adoption of a child;

 

(5) Loss of full-time employment by a Spouse;

 

(6) Expenses or loss of income incurred by reason of the Participant or the
Participant’s Spouse who is a member of the military reserves of the United
States, being called into active duty;

 

(7) An unpaid leave of absence by the Participant;

 

(8) Legal expenses incurred on behalf of the Employee, the Employee’s Spouse or
children; or

 

(9) Payments to satisfy federal tax obligations that have not been timely paid.

 

(d)           Other available resources.  A withdrawal shall not be treated as
necessary to satisfy an immediate and heavy financial need of an Employee to the
extent the amount of the withdrawal is in excess of the amount required to
relieve the financial need or to the extent such need may be satisfied from
other resources that are reasonably available to the Employee. This
determination generally is to be made on the basis of all relevant facts and
circumstances. The Employee’s resources include those assets of an Employee’s
Spouse and minor children that are reasonably available to the Employee. 
However, property held for the Employee’s child under an irrevocable trust or
under the Uniform Gifts to Minors Act shall not be treated as a resource of the
Employee.  The amount of an immediate and heavy financial need may include any
amounts necessary to pay any federal, state, or local income taxes or penalties
reasonably anticipated to result from the withdrawal.  A withdrawal generally
may be treated as necessary to satisfy a financial need if the Plan
Administrator relies upon the Employee’s written representation, unless the
Employer or Plan Administrator has actual knowledge to the contrary, that the
need cannot reasonably be relieved:

 

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(1) Through reimbursement or compensation by insurance or otherwise;

 

(2) By reasonable liquidation of the Employee’s assets, to the extent such
liquidation would not itself cause an immediate and heavy financial need;

 

(3) By cessation of Salary Deferral Contributions under the Plan; or

 

(4) By other distributions or nontaxable (at the time of the loan) loans from
plans maintained by the Employer or by any other employer, or by borrowing from
commercial sources on reasonable commercial terms in an amount sufficient to
satisfy the need.

 

A need cannot be reasonably relieved by one of the actions listed above if the
effect would be to increase the amount of the need.  Notwithstanding (3) above,
a Participant may, but shall not be required to suspend or cease his or her
Salary Deferral Contributions in the event the Employer relies upon such
Participant’s written representation regarding the amount of withdrawal
necessary to satisfy a financial need.

 

(e)           Withdrawal deemed necessary to satisfy financial need. Instead of
a determination of the amount necessary to satisfy the financial need being made
under (d) above, the Employer may elect in the Adoption Agreement to deem a
withdrawal necessary to satisfy an immediate and heavy financial need of an
Employee if all of the following requirements are satisfied:

 

(1) The withdrawal is not in excess of the amount of the immediate and heavy
financial need of the Employee (the amount of an immediate and heavy financial
need may include any amounts necessary to pay any federal, state, or local
income taxes or penalties reasonably anticipated to result from the withdrawal);

 

(2) The Employee has obtained all distributions, other than hardship
withdrawals, and all nontaxable loans currently available under all plans
maintained by the Employer;

 

(3) If an Employee makes a hardship withdrawal from this Plan, or any other plan
maintained by the Employer, the Employee’s Salary Deferral Agreement shall be
revoked for the remainder of the Plan Year.  This section will no longer apply
for plan years beginning after December 31, 2001;

 

(4) Effective for Plan Years beginning after December 31, 2001, the Employer
shall prohibit the Employee from making elective contributions and Employee
contributions to the Plan and all other plans maintained by the Employer for 6
months after the receipt of the hardship withdrawal (however, this does not
include any mandatory Employee contribution to a defined benefit plan, nor does
it include an Employee’s contributions to a health or welfare benefit plan).  A
Participant who receives a distribution of elective deferrals in calendar year
2001 on account of hardship shall be prohibited from making elective deferrals
and Employee contributions under this and

 

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all other plans of the Employer for 6 months after receipt of the distribution
or until January 1, 2002, if later; and

 

For Plan Years beginning prior to January 1, 2002, the Employer shall prohibit
the Employee from making elective contributions and employee contributions to
the Plan and all other plans maintained by the Employer for at least 12 months
after the receipt of the hardship withdrawal (however, this does not include any
mandatory employee contribution to a defined benefit plan, nor does it include
an Employee’s Contributions to a health or welfare benefit plan); and

 

(5) The Employee may not make Salary Deferral Contributions for the Employee’s
taxable year immediately following the taxable year of the hardship withdrawal
in excess of the applicable limit under Code section 402(g) for such next
taxable year less the amount of such Employee’s Salary Deferral Contributions
for the taxable year of the hardship withdrawal.

 

(f)            Limitation on Amount Withdrawn.  Financial hardship withdrawals
shall be made only from Salary Deferral Contributions, and shall not be made
from any income allocable to Salary Deferral Contributions, nor shall financial
hardship withdrawals ever be made from Qualified Matching Contributions nor
Qualified Nonelective Contributions.  Financial hardship withdrawals shall not
be made from Matching Contributions and/or Discretionary Contributions unless
otherwise specified in the Adoption Agreement.

 

7.12.       Attainment of Age 59-1/2.  If authorized in the Adoption Agreement,
as of the date that a Participant attains the age of 59 1/2, the Participant may
withdraw all or any part of his Vested Balance, and such withdrawal shall be
made pursuant to Article VIII, if Article VIII is applicable, as specified in
the Adoption Agreement.

 

7.13.       Other Withdrawals.

 

(a)(1)      Nondeductible Employee Account.  Unless prohibited in the Adoption
Agreement, a Participant may, by written notice to the Plan Administrator,
withdraw from his Nondeductible Employee Account a sum not greater than the
amount of his prior Nondeductible Employee Contributions (less any amount
previously disbursed); plus any income allocable thereto.

 

(a)(2)      Rollover Account.  Unless prohibited in the Adoption Agreement, a
Participant may, by written notice to the Plan Administrator, withdraw a portion
or all of his Unrelated Rollover Account (less any amount previously disbursed)
at any time.

 

(b)           Restrictions on Certain Contributions. A Participant may not make
withdrawals from his Salary Deferral Account, Qualified Nonelective
Contributions Account or Qualified Matching Contributions Account prior to the
earlier of:

 

(1) his Severance from Employment, total and permanent Disability, or death;

 

(2) his attainment of age 59 1/2;

 

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(3) proven financial hardship, subject to the approval of the Plan Administrator
(however, in no event shall Qualified Matching Contributions and/or Qualified
Nonelective Contributions be withdrawn on account of financial hardship);

 

(4) the date of the sale by the Employer of substantially all of the assets
(within the meaning of Code section 409(d)(2)), but only with respect to
Participants who continue employment with the corporation acquiring such assets;

 

(5) the date of the sale by the Employer of interest in a subsidiary (within the
meaning of Code section 409(d)(3)) with respect to a Participant who continues
employment with such subsidiary; or

 

(6) termination of the Plan without establishment or maintenance of another
defined contribution plan other than an employee stock ownership plan (as
defined in Code section 4975(e)(7)) or a Simplified Employee Pension Plan (as
defined in Code section 408(k)).

 

However, clauses (4) and (5) shall not apply, if the sale is to a business that
is an Affiliate of the Employer, or if in conjunction with the sale, the buyer
agrees to sponsor this Plan or the buyer requests the assets and liabilities of
the affected Participants to be transferred to a Plan qualified under Code
section 401(a) maintained or installed by the buyer.

 

Furthermore, with respect to clauses (4), (5) and (6) above, the Participants
shall receive a lump sum distribution (as defined by Code section 402(e)(4)) by
reason of such event.

 

(c)           Matching and Discretionary Accounts.  A Participant may not make
withdrawals from his Employer Matching Account or Employer Discretionary Account
as set forth in (b) above, unless otherwise specified in the Adoption Agreement.

 

7.14.       Denial of a Request for Benefits.

 

(a)           Content of a denial.  All claims for Plan benefits shall be
subject to a full and fair review.  If the Plan Administrator fully or partially
denies any claim for benefits under the Plan, the Plan Administrator shall set
forth in writing in a manner calculated to be understood by the Participant or
any other person claiming benefits, the following information:

 

(1) the specific reason for the denial;

 

(2) the specific reference to the pertinent Plan provisions on which the denial
is based;

 

(3) a description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why such material or
information is necessary;

 

(4) the appropriate information as to the steps to be taken for the claim to be
submitted for review; and

 

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(5) an explanation of the Plan Administrator’s review procedure as stipulated in
this Plan.

 

(6) If notice of the denial of a claim is not furnished to the claimant in
accordance with the above within 90 days (unless circumstances beyond the Plan
Administrator’s control cause a lengthier period before a determination of the
validity of a claim can be made), the claim shall be deemed denied.  The
claimant shall then be permitted to proceed to the review stage described in
paragraph (b) below.

 

(b)           Review procedure.  The review procedure is as follows:

 

(1) Upon denial of a claim for benefits under the Plan, the claimant must file a
request in writing with the Plan Administrator requesting that the claim be
reviewed by the Plan Administrator.

 

(2) The written request for the claim to be reviewed must be filed with the Plan
Administrator no later than 60 days after the claimant received written
notification of the denial of the claim, or the period described in subparagraph
(a)(6) above, if applicable.  If the claim is sent to the Plan Administrator by
first class mail, the postmark shall be the date the written request for review
is submitted.

 

(3) The claimant may review all pertinent documents relating to the denial of
the claim at the Plan Administrator’s office and at other locations, if any, so
specified by the Plan Administrator.  Upon written request, the claimant may
obtain copies of all pertinent documents relating to the denial of the claim. 
The Plan Administrator may make a reasonable charge for the copies.

 

(4) The claimant may submit any issues and comments regarding the denial of the
claim, in writing, to the Plan Administrator.

 

(5) The Plan Administrator shall afford such Participant or other interested
party a reasonable opportunity for a full and fair review by the Plan
Administrator of the claim under review.  The Plan Administrator shall take any
and all steps to obtain knowledge of all the pertinent facts and evidence that
are required, in the Plan Administrator’s judgment, to render a fair decision
with respect to the claim, including obtaining legal counsel.

 

(6) The Plan Administrator shall advise the claimant in writing of its decision
within 60 days after the Plan Administrator received the written request for a
review of the claim.   The 60-day time limit shall not be extended, except where
there are special circumstances that require such an extension, and a written
description of those circumstances is sent to the claimant within the 60-day
period.  If there is such an extension, a decision shall be made as soon as
practicable, but not later than 120 days after the receipt by the Plan
Administrator of the written request for the claim to be reviewed.

 

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(7) The Plan Administrator’s decision of the claim for review shall be
communicated to the claimant in writing and, if applicable, shall include
specific references to the pertinent Plan provisions on which the decision was
based.

 

7.15.       Disputed Benefits.  If any dispute shall arise between a Participant
or other person claiming benefits under the Plan, and the Plan Administrator,
after the review of the claim for benefits, or in the event of any dispute as to
the person to whom the payment of any benefit under the Plan shall be made, the
Trustee may withhold payment of all or any part of the benefits payable
hereunder to the Participant or other person claiming under the Participant
until such dispute has been resolved by a court of competent jurisdiction or
settled by the parties involved.

 

7.16.       Disputed Claims.   The Plan Administrator shall have the authority
to review and settle all claims against the Plan, including claims where the
settlement amount cannot be calculated under the Plan’s benefit formula.  This
authority permits the Plan Administrator to settle, in a compromised fashion,
disputed claims for benefits and any other disputed claims made against the
Plan.

 

7.17.       Qualified Domestic Relations Orders.

 

(a)           In general.  All rights and benefits, including elections,
provided to a Participant in this Plan shall be subject to the rights afforded
to any alternate payee under a Qualified Domestic Relations Order. The Plan
Administrator is authorized to and shall establish written procedures to
effectuate the requirements for administering Qualified Domestic Relations
Orders.

 

(b)           Withdrawal provisions.  No withdrawal may be made under this Plan
by a Participant during the period in which the Plan Administrator is making a
determination of whether a domestic relations order affecting the Participant’s
Account is a Qualified Domestic Relations Order.  Further, if the Plan
Administrator is aware that a Qualified Domestic Relations Order is being sought
with respect to a Participant’s benefit, the Plan Administrator may restrict the
Participant’s ability to obtain any withdrawal otherwise available under the
Plan until the Plan Administrator has determined that such withdrawal would not
be inconsistent with any such order or that no such order shall be submitted. If
the Plan Administrator is in receipt of a Qualified Domestic Relations Order
with respect to any Participant’s benefit, it may prohibit that Participant from
obtaining a withdrawal until the alternate payee’s rights under such order are
satisfied.

 

(c)           Distribution provisions.  No distribution may be made to a
Participant during the period in which the Plan Administrator is making a
determination of whether a domestic relations order affecting the Participant’s
benefit is a Qualified Domestic Relations Order. Further, if the Plan
Administrator is aware that a Qualified Domestic Relations Order affecting a
Participant’s benefit is being sought, it may prohibit such Participant from
commencing to receive a distribution until the Plan Administrator has determined
that such distribution would not be inconsistent with any such order or that no
such order shall be submitted.  If the Plan Administrator is in receipt of a
Qualified Domestic Relations Order with respect to any Participant’s benefit, it
may prohibit such Participant from receiving a distribution until the alternate
payee’s rights under such order are satisfied.

 

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(d)           Beneficiary Designation.   Unless specifically stated otherwise in
a Qualified Domestic Relations Order, in the event of a final divorce decree,
any prior beneficiary designation of the ex-spouse by a Participant shall be
null and void.

 

(e)           Other restrictions.  If the Plan Administrator is in receipt of a
domestic relations order, or the Plan Administrator is otherwise aware that a
Qualified Domestic Relations Order affecting a Participant’s Account is being
sought, the Plan Administrator may take such actions as necessary (including,
without limitation, restricting the Participant’s ability to withdraw, borrow,
or direct the investment of funds in his or her Account) in order to administer
the Plan consistently with the terms of any such Qualified Domestic Relations
Order.

 

(f)            Payment commencement date.  Notwithstanding any other provision
of the Plan, in the event that a Qualified Domestic Relations Order is received
by the Plan Administrator, benefits shall be payable in accordance with such
order and with Code section 414(p) and ERISA section 206(d).  Payments may be
made prior to the Participant’s “earliest retirement age” (as defined in Code
section 414(p) and ERISA section 206(d)), and are not subject to any other
distribution or withdrawal restrictions provided in this Plan.  The amount
payable to the Participant and to any other person other than the alternate
payee named in the order shall be adjusted accordingly.  If annuity payments
under this Plan have already commenced, the Qualified Domestic Relations Order
must provide how much of that dollar amount shall be paid to the alternate
payee.

 

Pursuant to section 1.411(a)-11(c)(6) of the Regulations, and notwithstanding
the provisions of Article VII and Article VIII, if applicable, to the contrary,
distributions to an alternate payee under the Plan shall not require the consent
of the alternate payee, except as shall be provided for in the Qualified
Domestic Relations Order applicable to such alternate payee.  Any amounts held
for the benefit of an alternate payee under the Plan shall be immediately
distributable, without the consent of the alternate payee, after the Plan
Administrator has determined that an order is a Qualified Domestic Relations
Order, pursuant to the Plan’s written administrative procedures for
administering Qualified Domestic Relations Orders.

 

(g)           Alternate payee’s death.  In the absence of a Beneficiary
designation for the alternate payee in the Qualified Domestic Relations Order,
the alternate payee shall be treated as a single Participant under the Plan and
the alternate payee’s interest shall pass to his or her estate or other
individuals, in accordance with the terms of the Plan.

 

(h)           Miscellaneous.  If this Plan is a participant-directed plan as
provided under Article XI, upon the Plan’s receipt of a domestic relations order
affecting a Participant’s Accounts, the Participant shall continue to direct the
investments in his or her Accounts.  Upon approval of the domestic relations
order as a Qualified Domestic Relations Order, the alternate payee of such
accounts shall be entitled to direct the investment of his or her own separate
interest, unless the Qualified Domestic Relations Order provides otherwise.  If
the alternate payee declines or otherwise fails to direct the investments of his
or her own separate interest in the Participant’s Accounts, such separate
interest shall be invested in the same manner as any other portion of the
Participant’s Account as of the split date.  Tax basis in Nondeductible Employee
Contributions shall be allocated on a pro rata basis, based on the ratio of the

 

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alternate payee’s benefit to the Participant’s total benefit (including the
portion of his or her benefit assigned to the alternate payee).  Alternate
payees shall not be entitled to borrow money under the Plan’s loan provisions.

 

7.18.       Designation of Beneficiary.

 

(a)           Spouse is Beneficiary.  The Beneficiary of any Death Benefit
payable under the Plan shall be the Participant’s Spouse.  Except, however, the
Participant may designate a Beneficiary other than his Spouse if:

 

(1) the Participant and his Spouse have validly waived the Pre-retirement
Survivor Annuity, if Article VIII is applicable, or the Spouse has waived his or
her right to be the Participant’s Beneficiary;

 

(2) the Participant has no Spouse; or

 

(3) the Spouse cannot be located.

 

Notwithstanding the preceding, and pursuant to section 1.401(a)-20, Q&A-27 of
the Regulations, if it is established to the satisfaction of the Plan
Administrator that a Spouse is legally incompetent (as determined by applicable
state law) to give consent, the Spouse’s legal guardian (as appointed or
recognized under applicable state law), even if the guardian is the Participant,
may give the applicable consent.

 

(b)           Beneficiary designation.  The designation of a Beneficiary shall
be made on a form satisfactory to the Plan Administrator. A Participant may at
any time revoke his designation of a Beneficiary or change his Beneficiary by
filing written notice of such revocation or change with the Plan Administrator.
However, the Participant’s Spouse must again consent in writing to any such
change or revocation unless the Spouse’s consent expressly permits designation
by the Participant without further consent by the Spouse.  In the event no valid
designation of Beneficiary exists at the time of the Participant’s death, the
death benefit shall be payable to his Spouse if living, and, if not, to his
estate.  Any written consent by a Spouse of a change of Beneficiary shall be
consented to in writing, and such written consent shall designate a Beneficiary
which may not be changed without spousal consent (or the consent of the Spouse
expressly permits designations by the Participant without any requirement of
further consent by the Spouse), and the Spouse’s consent shall acknowledge the
effect of such election and shall be witnessed by a notary public.  A party’s
attorney-in-fact shall be permitted to change the Beneficiary if and only if the
power of attorney includes the specific authority to make changes in the
grantor’s beneficial designations under employee benefit plans, and provided
also that all other requirements, including, if applicable, Spousal consent,
have been satisfied.

 

The preceding notwithstanding, Spousal consent to a Participant’s election to
waive death benefits is not required if, pursuant to section 1.401(a)-20,
Q&A-12(b) of the Regulations, it is established to the satisfaction of the Plan
Administrator that the Spouse is legally incompetent to give consent.  Where
such Spouse is not legally competent to give consent, the Spouse’s legal
guardian, even if the legal guardian is the Participant, may give the

 

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appropriate consent.  For purposes of this Section, legal guardianship and legal
competency shall be determined by the laws of the state having jurisdiction.

 

(c)           Alternate payee.  An individual who is designated as an alternate
payee in a Qualified Domestic Relations Order (as defined in Code section 414(p)
and ERISA section 206(d)) relating to a Participant’s benefits under this Plan
shall be treated as a Beneficiary hereunder, to the extent provided by such
order.

 

7.19.       Location of Beneficiary or Participant Unknown.  In the event that
all, or any portion, of the distribution payable to a Participant or his
Beneficiary hereunder shall, at the Participant’s attainment of his Normal
Retirement Age, remain unpaid solely by reason of the inability of the Plan
Administrator to locate such Participant or his Beneficiary, after sending a
certified or registered letter, return receipt requested to the last known
address, then the Plan Administrator may attempt to ascertain the whereabouts of
such Participant or Beneficiary, through programs established by the Social
Security Administration or the Internal Revenue Service. However, if such
efforts should fail to locate such Participant or Beneficiary, then the
remaining amount distributable with respect to such Participant or his
Beneficiary may be reallocated in the same manner as a Forfeiture, if so
directed by the Plan Administrator. In the event a Participant or Beneficiary is
located subsequent to his benefit being reallocated, and such person claims such
reallocated benefit, such benefit shall be restored out of current year
Forfeitures, unadjusted for gains or losses.  The preceding notwithstanding, if
an Employee has terminated Service with the Employer and the value of such
Employee’s vested Account is not greater than $5,000 ($3,500 for Plan Years
prior to January 1, 1998), the Employee’s Vested Balance shall be distributable
to such Employee immediately upon his date of termination, and the nonvested
portion shall become immediately forfeitable. If the Plan Administrator is not
able to locate an Employee described in the preceding sentence, after such
Participant has incurred a one-year Break-in-Service, the vested portion may be
treated as a Forfeiture, subject to reinstatement in the manner described in
this Section 7.19.

 

In the event that the Plan is terminated, the benefits maintained in an account
under the Plan, on the date of such termination, for the benefit of a
Participant, Beneficiary, or Alternate Payee who cannot be located, shall be
maintained outside the Plan. Any such benefits may be maintained by the purchase
of an annuity, the establishment of an individual retirement arrangement (as
described in Code sections 408(a) or (b)), or by some other method or methods
which meet applicable Department of Labor requirements. The Plan Administrator
shall have the sole discretion in determining which method or manner, or
combination thereof, from among the preceding, shall be utilized for the purpose
of maintaining such benefits. The duty of the Named Fiduciaries (as defined in
Section 15.01) hereunder, to maintain any such benefits under the Plan, shall be
extinguished upon the placement of such benefits outside the Plan in the manner
described in this paragraph.

 

7.20.       Distribution for Minor Beneficiary.  In the event a distribution is
to be made to a minor, then the Administrator may direct that such distribution
be paid to the legal guardian, or if none, to a parent of such Beneficiary or a
responsible adult with whom the Beneficiary maintains his residence, or to the
custodian for such Beneficiary under the Uniform Gift to Minors Act or Gift to
Minors Act if such is permitted by the laws of the state in which the
Beneficiary resides.  Such a payment to the legal guardian, custodian or parent
of a minor Beneficiary shall fully discharge the Trustee, Employer, and Plan
from further liability on account thereof.

 

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7.21.       Rollover Distributions.

 

(a)           Direct Rollovers.  The provisions of this Section shall apply to
distributions made on or after January 1, 1993.  Notwithstanding any provision
of the Plan to the contrary, that would otherwise limit a Distributee’s election
under this Section, a Distributee may elect, at the 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
a Distributee in a Direct Rollover.

 

(b)           Definitions. The following definitions shall apply for the
purposes of this Section 7.21.

 

(1) Direct Rollover means a payment by the Plan to the Eligible Retirement Plan
specified by a Distributee.

 

(2) Distributee means any of the following: an Employee; a former Employee; an
Employee’s or former Employee’s Spouse; an Employee’s or former Employee’s
Surviving Spouse; an Employee’s or former Employee’s Spouse or former Spouse who
is an alternate payee under a Qualified Domestic Relations Order, as defined in
Code section 414(p), with regard to the interest of such Spouse or former
Spouse.

 

(3) Eligible Retirement Plan,effective for Plan Years beginning after December
31, 2001, means an individual retirement account described in Code section
408(a), an individual retirement annuity described in Code section 408(b), an
annuity plan described in Code section 403(b), an eligible plan under section
457(b) of the Code which is maintained by a state, political subdivision of a
state, or any agency or instrumentality of a state or political subdivision of a
state, or a qualified trust described in Code section 401(a), that accepts a
Distributee’s Eligible Rollover Distribution.

 

With respect to any Plan Year commencing prior to January 1, 2002, Eligible
Retirement Plan, means an individual retirement account described in Code
section 408(a), an individual retirement annuity described in Code section
408(b), an annuity plan described in Code section 403(b), or a qualified trust
described in Code section 401(a), that accepts a Distributee’s Eligible Rollover
Distribution.  However, in the case of an Eligible Rollover Distribution to the
Surviving Spouse (or to a former Spouse who is an alternate payee under a
Qualified Domestic Relations Order), an Eligible Retirement Plan is an
individual retirement account or individual retirement annuity.

 

(4) Eligible Rollover Distribution, effective for Plan Years beginning after
December 31, 2001, means any distribution of all or any portion of the balance
to the credit of a Distributee, except that an Eligible Rollover Distribution
does not include:

 

(i)  any distribution that is one of a series of substantially equal periodic
payments (not less frequently than annually) made for the life (or life
expectancy) of a Distributee

 

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or the joint lives (or joint life expectancies) of a Distributee and the
Distributee’s designated Beneficiary, or for a specified period of ten years or
more;

 

(ii)  any distribution to the extent required under Code section 401(a)(9);

 

(iii) Effective January 1, 1999, any hardship distribution described in Code
section 401(k)(2)(B)(i)(IV); and

 

(iv) any hardship distribution described in Code section 402(c)(4)(C).

 

A portion of a distribution shall not fail to be an Eligible Rollover
Distribution merely because the portion consists of Nondeductible Employee
Contributions that are not includible in gross income. However, such portion may
be transferred only to an individual retirement account or annuity described in
section 408(a) or (b) of the Code, or to a qualified defined contribution plan
described in section 401(a) or 403(a) of the Code that agrees to separately
account for amounts so transferred, including separately accounting for the
portion of such distribution which is includible in gross income and the portion
of such distribution which is not so includible.

 

With respect to any Plan Year commencing prior to January 1, 2002, Eligible
Rollover Distribution, means any distribution of all or any portion of the
balance to the credit of a Distributee, except that an Eligible Rollover
Distribution does not include:

 

(i) any distribution that is one of a series of substantially equal periodic
payments (not less frequently than annually) made for the life (or life
expectancy) of a Distributee or the joint lives (or joint life expectancies) of
a Distributee and the Distributee’s designated Beneficiary, or for a specified
period of ten years or more;

 

(ii)  any distribution to the extent required under Code section 401(a)(9);

 

(iii) Effective January 1, 1999, any hardship distribution described in Code
section 401(k)(2)(B)(i)(IV);

 

(iv) 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 Employer securities).

 

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ARTICLE VIII. JOINT AND SURVIVOR ANNUITY REQUIREMENTS.

 

8.01.       Provisions of this Article take Precedence.  The provisions of this
Article shall apply, notwithstanding any conflicting provision in this Plan, to
any Participant who is credited with at least one (1) Hour of Service with the
Employer on or after August 23, 1984, and such other Participants as provided
for in this Article, unless the Adoption Agreement (a) does not permit the
payment of benefits in the form of a life annuity; (b) does not permit
Plan-to-Plan Transfers; and (c) specifically excludes the provisions of this
Article.

 

8.02.       Qualified Joint and Survivor Annuity.  Unless an optional form of
benefit is selected by a Participant pursuant to a Qualified Election within the
Notice Period ending on the Annuity Starting Date, a married Participant’s
Vested Balance shall be paid in the form of a Qualified Joint and Survivor
Annuity and an unmarried Participant’s Vested Balance shall be paid in the form
of a life annuity.  A Participant may elect to have such an annuity distributed
upon the attainment of the Earliest Retirement Age under the Plan and Adoption
Agreement.

 

8.03.       Definitions.  For purposes of this Article VIII, the following terms
shall have the meaning provided herein.

 

(a)           Annuity Starting Date means the first day of the first period for
which an amount is paid as an annuity or any other form.

 

(b)           Earliest Retirement Age means the earliest date on which, under
the Plan and Adoption Agreement, a Participant may elect to receive retirement
benefits.

 

(c)           Election Period means the period which begins on the first day of
the Plan Year in which a Participant attains age 35 and ends on the date of a
Participant’s death. If a Participant Separates from Service prior to the first
day of the Plan Year in which age 35 is attained, with respect to the Account
balance as of the date of separation, the Election Period shall begin on the
date of separation.

 

(d)           Pre-age 35 Waiver means the special Qualified Election waiver of
the Qualified Pre-retirement Survivor Annuity, by a Participant who shall not
have attained age 35 as of the end of any current Plan Year. Such waiver shall
be for the period beginning on the date of such election and ending on the first
day of the Plan Year in which the Participant shall attain age 35.

 

Such special Qualified Election shall not be valid unless a Participant receives
a written explanation of the Qualified Pre-retirement Survivor Annuity in such
terms as are comparable to the explanation required under Section 8.05. 
Qualified Pre-retirement Survivor Annuity coverage shall be automatically
reinstated as of the first day of the Plan Year in which the Participant attains
age 35. Any new waiver on or after such date shall be subject to the full
requirements of this Article.

 

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(e)           Qualified Joint and Survivor Annuity means an immediate annuity
for the life of the Participant with a survivor annuity for the life of the
Spouse which is not less than fifty percent (50%) nor more than one-hundred
percent (100%) of the amount of the annuity which is payable during the joint
lives of the Participant and the Spouse, and which is the amount of benefit
which can be purchased with the Participant’s Vested Account Balance. The
percentage of the survivor annuity under the Plan shall be fifty percent (50%)
unless a different percentage is provided for in the Adoption Agreement.

 

(f)            Qualified Election means a waiver of a Qualified Joint and
Survivor Annuity or a Qualified Pre-retirement Survivor Annuity.  Any waiver of
a Qualified Joint and Survivor Annuity or a Qualified Pre-retirement Survivor
Annuity shall not be effective unless:

 

(1) a Participant’s Spouse consents in writing to the election;

 

(2) the election designates a specific Beneficiary, including any class of
Beneficiaries or any contingent Beneficiaries, which may not be changed without
spousal consent (or the Spouse expressly permits designations by the Participant
without any further spousal consent);

 

(3) the Spouse’s consent acknowledges the effect of the election; and

 

(4) the Spouse’s consent is witnessed by a Plan representative or a notary
public.

 

Also, a Participant’s waiver of a Qualified Joint and Survivor Annuity shall not
be effective unless the Qualified Election designates the form of benefit
payment (method of distribution) which may not be changed without spousal
consent (or the Spouse expressly permits designations by the Participant without
any further spousal consent).

 

Exceptions to spousal consent.  A waiver shall be deemed a Qualified Election if
it is established to the Plan Administrator’s satisfaction that:

 

(1) there is no Spouse; or

 

(2) that the Spouse cannot be located; or

 

(3) pursuant to section 1.401(a)-20, Q&A-27 of the Income Tax Treasury
Regulations, the Spouse is legally incompetent to give consent.

 

In the event that the Spouse is not legally competent to give consent, then the
Spouse’s legal guardian, even if the guardian is the Participant, may give such
consent.  For purposes of the preceding, legal competency and legal guardianship
shall be determined by state law.  Where there is a question as to which state
has jurisdiction to determine such matters, the Plan Administrator may determine
which jurisdiction shall control.

 

Any consent by a Spouse obtained under this provision (or the establishment that
the consent of a Spouse may not be obtained) shall be effective only with
respect to such Spouse.  A consent that permits designations by a Participant
without any requirement of further consent

 

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by such Spouse must acknowledge that the Spouse has the right to limit consent
to a specific Beneficiary, and a specific form of benefit (method of
distribution) where applicable, and that the Spouse voluntarily elects to
relinquish either or both of such rights.  A revocation of a prior waiver may be
made by a Participant without the consent of the Spouse at any time before
commencement of benefits.  The number of revocations shall not be limited.  No
consent obtained under this provision shall be valid unless a Participant has
received notice as provided in Section 8.05.

 

8.04.       Qualified Pre-retirement Survivor Annuity.  Unless an optional form
of benefit has been selected by a Participant pursuant to a Qualified Election,
if a Participant dies before the Annuity Starting Date, then the Participant’s
Vested Account Balance shall be applied, at the discretion of the Surviving
Spouse, toward the purchase of an annuity for the life of the Surviving Spouse,
subject to the restrictions of Sections 8.07 and 8.08. The Surviving Spouse may
elect to have such annuity distributed within a reasonable period after the
Participant’s death.

 

8.05.       Notice Requirements.

 

(a)           Qualified Joint and Survivor Annuity.  In the case of a Qualified
Joint and Survivor Annuity as described in this Article, the Plan Administrator
shall, no less than thirty (30) days and no more than ninety (90) days prior to
the Annuity Starting Date, provide each Participant a written explanation of:

 

(1) the terms and conditions of a Qualified Joint and Survivor Annuity;

 

(2) the Participant’s right to make, and the effect of an election to waive, the
Qualified Joint and Survivor Annuity form of benefit;

 

(3) the rights of the Participant’s Spouse; and

 

(4) the right to make, and the effect of, a revocation of a previous election to
waive the Qualified Joint and Survivor Annuity.

 

(b)           Qualified Pre-Retirement Survivor Annuity.  In the case of a
Qualified Pre-retirement Survivor Annuity, the Plan Administrator shall provide
each Participant within the applicable period for such Participant, a written
explanation of the Qualified Pre-retirement Survivor Annuity in such terms and
in such manner as would be comparable to the explanation provided for meeting
the requirements in subsection (a) above applicable to a Qualified Joint and
Survivor Annuity.

 

The applicable period for a Participant is whichever of the following periods
ends last:

 

(1) the period beginning with the first day of the Plan Year in which a
Participant attains age 32 and ending with the close of the Plan Year preceding
the Plan Year in which a Participant attains age 35;

 

(2) a reasonable period ending after an Employee becomes a Participant;

 

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(3) a reasonable period ending after this Article first applies to a
Participant.

 

Notwithstanding the preceding, notice must be provided within a reasonable
period ending after Severance from Employment in the case of a Participant who
Separates from Service before attaining age 35.

 

For purposes of this subsection, a reasonable period ending after the enumerated
events described in (2) and (3) is the end of the two (2) year period beginning
one (1) year prior to the date the applicable event occurs, and ending one (1)
year after such date.  In the case of a Participant who Separates from Service
before the Plan Year in which age 35 is attained, notice shall be provided
within the two (2) year period beginning one (1) year prior to separation and
ending one (1) year after separation.  If such a Participant thereafter returns
to employment with the Employer, the applicable period for such Participant
shall be redetermined in accordance with this Article.

 

8.06.       Transitional Rules.

 

(a)           In general.  Participants who satisfy the following conditions
shall have the opportunity to elect to have their benefits paid in accordance
with subsection (b). This Section 8.06 applies to Participants who were not
receiving benefits under the Plan on August 23, 1984, and who:

 

(1) are credited with at least one (1) Hour of Service under this Plan (or a
predecessor plan) in a Plan Year beginning on or after January 1, 1976, and had
at least ten (10) Years of vesting Service when they Separated from Service with
the Employer; or

 

(2) are credited with at least one (1) Hour of Service under this Plan (or a
predecessor plan) on or after September 2, 1974, and who are not otherwise
credited with any Service in a Plan Year beginning on or after January 1, 1976.

 

Participants described in this subparagraph (a) shall be afforded the
opportunity to make the appropriate election during the period commencing on
August 23, 1984, and ending on the date benefits would otherwise commence to
such Participants.

 

(b)           Right to Automatic Joint and Survivor Annuity.  For a Participant
described in subsection (a) above, benefits under the Plan shall be distributed
in the form of a Qualified Joint and Survivor Annuity, unless a Participant
elects otherwise.  A Participant described in subsection (a)(2) above who has
elected to have his benefits paid in accordance with this Section 8.06, and any
Participant described in subsection (a)(1) above, who does not make such
election or who is described in subsection (a)(1), but does not have at least
ten (10) Years of vesting Service upon Severance from Employment, shall have
benefits distributed in accordance with all of the following requirements of
this subsection.

 

Benefits received under the Plan shall be provided in the form of a Qualified
Joint and Survivor Annuity, unless a Participant has elected otherwise during
the applicable election period, if benefits in the form of a life annuity become
payable to a married Participant who:

 

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(1) begins to receive payments under the Plan on or after Normal Retirement Age;
or

 

(2) dies on or after Normal Retirement Age while still working for the Employer;
or

 

(3) begins to receive benefit payments on or after Qualified Early Retirement
Age; or

 

(4) Separates from Service on or after attaining Normal Retirement Age (or
Qualified Early Retirement Age) and after satisfying the eligibility
requirements for the payment of benefits under the Plan and thereafter dies
before beginning to receive such benefits.

 

For this subsection (b), the applicable election period shall begin at least six
(6) months before a Participant attains Normal Retirement Age (or Qualified
Early Retirement Age) and shall end no more than 90 days before the commencement
of benefits.  Any election under this provision shall be in writing and may be
changed by a Participant at any time.

 

(c)           Election of early survivor annuity.  A Participant who is employed
after attaining Qualified Early Retirement Age, shall be able to elect, during
the applicable election period, to have a survivor annuity payable upon death. 
If a Participant elects the survivor annuity, payments under such annuity must
not be less than the payments which would have been paid to the Spouse under a
Qualified Joint and Survivor Annuity if such Participant had retired on the day
before such Participant’s death.

 

For this subsection (c), the applicable election period begins on the later of
the 90th day before a Participant attains Qualified Early Retirement Age, or the
date on which participation begins, and the election period ends on the date a
Participant terminates employment.  Any election under this provision shall be
in writing and may be changed by a Participant at any time.

 

(d)           Qualified Early Retirement Age.  For purposes of Section 8.06,
Qualified Early Retirement Age is the latest of:

 

(1) the earliest date, under the Plan (or as specified in the Adoption
Agreement) on which a Participant may elect to receive retirement benefits;

 

(2) the first day of the 120th month beginning before a Participant reaches
Normal Retirement Age; or

 

(3) the date a Participant begins participation.

 

8.07.       Account Balance Not Greater than $5,000.  The provisions of this
Article shall not apply for any Participant whose Vested Balance, at the Annuity
Starting Date, is not greater than $5,000.  Specifically, the otherwise
applicable consent requirements shall not apply.  In such event, a Participant’s
Vested Account Balance shall be distributed in a lump sum.

 

8.08.       Consent Required for Certain Distributions Exceeding $5,000.  A
partial or total distribution may not be made when the present value of the
nonforfeitable accrued benefit (including Employer and Employee contributions,
but not including accumulated deductible Employee

 

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contributions) exceeds $5,000, unless the distribution is consented to in
writing by the Participant and Participant’s Spouse, if any (or where either the
Participant or the Spouse has died, the survivor).  Notwithstanding the
preceding, a distribution may be made without consent if, and only if, the
distribution is automatically in the form of a Qualified Pre-retirement Survivor
Annuity or a Qualified Joint and Survivor Annuity.

 

The consent of a Participant and such Participant’s Spouse shall be obtained in
writing within the 90 day period ending on the Annuity Starting Date.  The Plan
Administrator shall notify a Participant and such Participant’s Spouse of the
right to defer any distribution until such Participant’s Account Balance is no
longer immediately distributable.  Notwithstanding the preceding, only a
Participant need consent to the commencement of a distribution in the form of a
Qualified Joint and Survivor Annuity while the Account balance is immediately
distributable.  An Account is immediately distributable if any part of the
Account balance could be distributed to a Participant (or Surviving Spouse)
before a Participant attains (or would have attained if not deceased) the later
of Normal Retirement Age, or age 62.

 

For purposes of the preceding paragraph, the applicable notice shall include a
general description of the material features, and an explanation of the relative
values of, the optional forms of benefit (methods of distribution) available
under the Plan.  Such explanation shall be in a manner that would satisfy the
notice requirements of Section 8.05(a), and Code section 417(a)(3), and shall be
provided no less than 30 days and no more than 90 days prior to the Annuity
Starting Date.

 

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ARTICLE IX. TOP HEAVY PLAN.

 

The provisions of this Article shall supersede any conflicting provisions in the
Plan or Adoption Agreement if the Plan is or becomes Top-Heavy for any Plan Year
beginning after December 31, 2001. For Plan Years commencing prior to January 1,
2002, Top-Heavy provisions are as set forth in Appendix A.

 

9.01.       Definitions.  If the Plan is or becomes Top-Heavy in any Plan Year
beginning after December 31, 2001, the provisions of this Article shall
supersede any conflicting provisions in the Plan or Adoption Agreement.

 

(a)           Determination Date means, with respect to any Plan Year, the last
day of the preceding Plan Year, or, in the case of the first Plan Year, the last
day of such Plan Year.

 

(b)           Permissive Aggregation Group means that group of plans in a
Required Aggregation Group, together with any plan or plans of the Employer not
required to be included in the Required Aggregation Group, provided the
resulting group, taken as a whole, would continue to satisfy the provisions of
Code sections 401(a)(4) and 410

 

(c)           Present Value of Accrued Benefits means the present discounted
value of all Participants’ accrued benefits under all defined benefit plans
maintained by the Employer, discounted using the interest and mortality rates
specified in the Adoption Agreement, if applicable.

 

(d)           Required Aggregation Group means that group of plans composed of
each:

 

(1) plan of the Employer in which at least one Key Employee participates or
participated at any time during the Determination Period (regardless of whether
the plan is terminated), and

 

(2) any other qualified plan of the Employer which enables any plan in which a
Key Employee participates to meet the requirements of Code section 401(a)(4) or
410.

 

(e)           Top-Heavy Plan Year means a Plan Year commencing after December
31, 2001, in which the Plan is a Top-Heavy or a Super-Top-Heavy Plan.

 

(f)            Top-Heavy Ratio means the following:

 

(1) If the Employer maintains one or more defined contribution plans (including
any Simplified Employee Pension Plan) and the Employer has not maintained any
defined benefit plan which during the one-year (1) period ending on the
Determination Date has or has had accrued benefits, the Top-Heavy Ratio for this
Plan alone or for the Required Aggregation Group or the Permissive Aggregation
Group (whichever is applicable) is a fraction, the numerator of which is the sum
of the Total Balances of all Key Employees as of the Determination Date
(including any part of any Account balance distributed in the one-year (1)
period ending on the Determination Date, but

 

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excluding any Account balance due to unrelated Rollovers and/or Plan-to-Plan
Transfers), and the denominator of which is the sum of all Total Balances
(including any part of any Account balance distributed in the one-year (1)
period ending on the Determination Date, provided that with respect to death
benefits, the amount used for Top-Heavy testing is the amount determined as
above immediately prior to a Participant’s death, including the cash value of
life insurance policies, if any), both computed in accordance with Code section
416 and the regulations promulgated thereunder. 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 section
416(g)(2)(A)(i) of the Code. In the case of a distribution made for a reason
other than Severance from Employment, death, or Disability, these provisions
shall be applied by substituting “five-year (5) period” for “one-year (1)
period.” Both the numerator and denominator of the Top-Heavy Ratio are adjusted
to reflect any contribution which is due but unpaid as of the Determination
Date, but which is required to be taken into account on that date under Code
section 416 or the regulations promulgated thereunder.

 

(2) If the Employer maintains one or more defined contribution plans (including
any Simplified Employee Pension Plan) and the Employer maintains or has
maintained one or more defined benefit plans which during the one-year (1)
period ending on the Determination Date has or has had any accrued benefits, the
Top-Heavy Ratio for any Required Aggregation Group or Permissive Aggregation
Group (whichever is applicable) is a fraction, the numerator of which is the sum
of Total Account Balances under the aggregated defined contribution plan or
plans for all Key Employees determined in accordance with subsection (1) above
(including any part of any Account balance distributed in the one-year (1)
period ending on the Determination Date, but excluding any Account balance due
to unrelated Rollovers and/or Plan-to-Plan Transfers), and the Present Value of
Accrued Benefits under the aggregated defined benefit plan or plans for all Key
Employees as of the Determination Date, and the denominator of which is the sum
of the Total Balances under the aggregated defined contribution plans for all
Participants (including any part of any Account Balance distributed in the
one-year (1) period ending on the Determination Date, but excluding any Account
Balance due to unrelated Rollovers and/or Plan-to-Plan Transfers), and the
Present Value of Accrued Benefits under the defined benefit plan or plans for
all Participants as of the Determination Date, all determined in accordance with
Code section 416 and the regulations promulgated thereunder. 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 section
416(g)(2)(A)(i) of the Code. The accrued benefits under a defined benefit plan
in both the numerator and denominator of the Top-Heavy Ratio shall include any
distribution of an accrued benefit made in the one-year (1) period ending on the
Determination Date.  In the case of a distribution made for a reason other than
Severance from Employment, death, or Disability, these provisions shall be
applied by substituting “five-year (5) period” for “one-year (1) period.”

 

(3) For purposes of subsections (1) and (2) above, the values used for
determining the Top-Heavy Ratio shall be determined as of the most recent
Valuation Date that falls

 

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within or ends with the 12-month period ending on the Determination Date except
as provided in Code section 416 and the regulations promulgated thereunder for
the first and second years of a defined benefit plan. The Account balances and
accrued benefits of a Participant (A) who is not a Key Employee, but who was a
Key Employee in a prior year, or (B) who has not been credited with at least one
(1) Hour of Service with any Employer maintaining this Plan at any time during
the one-year (1) period ending on the Determination Date shall be disregarded.
The calculation of the Top-Heavy Ratio, and the extent to which distributions,
rollovers, and transfers are taken into account shall be made in accordance with
Code section 416 and the regulations promulgated thereunder. Any amount
attributable to accumulated deductible Employee contributions (as defined in
Code section 72(o)(5)(A)) shall be disregarded for purposes of computing the
Top-Heavy Ratio. When aggregating plans, the value of Account balances and
accrued benefits shall be calculated with reference to the Determination Dates
that fall within the same calendar year.

 

The accrued benefit of a Participant other than a Key Employee shall be
determined under (A) the method, if any, that uniformly applies for accrual
purposes under all defined benefit plans maintained by the Employer, or (B) if
there is no such method, as if such benefit accrued not more rapidly than the
slowest accrual rate permitted under the fractional rule of Code section
411(b)(1)(C).

 

9.02.       Determination of Top-Heavy and Super Top-Heavy Status.

 

(a)           Top-Heavy Status.   This Plan shall be a Top-Heavy Plan for any
Plan Year commencing after December 31, 2001, if any of the following conditions
exists:

 

 

(1) this Plan is not part of any Required Aggregation Group or Permissive
Aggregation Group of plans and the Top-Heavy Ratio for this Plan exceeds 60%; or

 

(2) this Plan is a part of a Required Aggregation Group of Plans but not part of
a Permissive Aggregation Group, and the Top-Heavy Ratio for the Required
Aggregation Group of plans exceeds 60%; or

 

(3) this Plan is a part of a Required Aggregation Group and part of a Permissive
Aggregation Group of plans, and the Top-Heavy Ratio for the Permissive
Aggregation Group exceeds 60%.

 

(b)           Super Top-Heavy Status.   This Plan shall be a Super-Top-Heavy
Plan for any Plan Year commencing after December 31, 2001, if, after first
substituting the term 90% for the term 60% each time it appears in Section 9.02
(a), the Plan would meet the test for being a Top-Heavy Plan specified therein.

 

9.03.       Special Vesting Requirements.   For any Top-Heavy Plan Year, the
vesting schedule shall provide for 100% vesting after three (3) Years of Service
unless the vesting schedule in the Adoption Agreement provides for vesting on a
schedule which is at least as rapid as required for Top-Heavy plans under Code
section 416(b). The minimum vesting schedule applies to all benefits within the

 

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meaning of Code section 411(a)(7) except those attributable to Participant
contributions (which shall be 100% vested at all times), including benefits
accrued before the effective date of Code section 416 and benefits accrued
before the Plan became a Top-Heavy Plan. Further, no reduction in vested
benefits may occur in the event the Plan’s status as a Top-Heavy Plan changes
for any Plan Year. However, this Section does not apply to the Employer Account
balance of any Employee who does not have one Hour of Service after the Plan has
initially become a Top-Heavy Plan; such Employee’s vested percentage in his
Employer Account shall be determined without regard to this Section.

 

9.04.       Special Minimum Allocation Requirements.

 

(a)           In general.   For any Top-Heavy Plan Year, except as otherwise
provided in subsection (b) below, for purposes of the minimum Top-Heavy
allocation, the Employer Contributions and Forfeitures allocated on behalf of
any Participant who is not a Key Employee shall not be less than the lesser of
three percent (3%) of such Participant’s 414(q) Compensation or (in the case
where the Employer has no defined benefit plan which designates this Plan to
satisfy Code section 401) the largest percentage of Employer Contributions and
Forfeitures, as a percentage of the lesser of a Key Employee’s 414(q)
Compensation, or Annual Limitation (adjusted pursuant to Code section
401(a)(17)), allocated on behalf of any Key Employee for such year.

 

The minimum allocation shall be determined without regard to any Social Security
contributions. The minimum allocation required (to the extent required to be
nonforfeitable under Section 9.03 and Code section 416(b)) shall not be
forfeited under Code section 411(a)(3)(B) or 411(a)(3)(D). This minimum
allocation shall be made even though, under other Plan provisions, a Participant
would not otherwise be entitled to receive an allocation, or would have received
a lesser allocation for the year because of:

 

(1) a Participant’s failure to complete a specified number of Hours of Service
(if any, as set forth in the Adoption Agreement); or

 

(2) a Participant’s failure to make or authorize any Salary Deferral
Contributions; or

 

(3) Compensation less than a stated amount.

 

A minimum Top-Heavy allocation, made on behalf of a Non-Key Employee shall be
allocated to a Non-Key Participant’s Salary Deferral Account for each Plan Year
in which the Plan is a Top-Heavy Plan. Salary Deferral Contributions, Matching
Contributions and Employer Contributions (and any other Employer Contributions)
to the Plan shall be combined to determine the largest contribution made or
required to be made for Key Employees.

 

The preceding provisions of this Section 9.04 shall not apply to this Plan if,
pursuant to the Adoption Agreement, this Plan enables a qualified defined
benefit plan in the Required Aggregation Group of the Employer to meet the
requirements of Code section 401(a)(4) or Code section 410.

 

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(b)           Special Rules.

 

(1)  In determining a Non-Key Employee’s required minimum allocation, such a
Non-Key Employee’s Salary Deferral Contributions for the Plan Year shall not be
taken into account.

 

(2)  The provisions in subsection (a) above shall not apply to any Participant
who was not employed by the Employer on the last day of the Plan Year (unless
otherwise specified in the Adoption Agreement).

 

(3)  The provisions of subsection (a) shall not apply to any Participant to the
extent such Participant is covered under any other qualified plan or plans
(including another plan that consists solely of a cash or deferred arrangement
which meets the requirements of section 401(k)(12) of the Code and Matching
Contributions with respect to which the requirements of section 401(m)(11) of
the Code are met) of the Employer and the Employer has provided in the Adoption
Agreement that the minimum allocation or benefit requirement applicable to
Top-Heavy Plans shall be met in such other plan or plans.

 

(4)  Matching Contributions shall be taken into account for purposes of
satisfying the minimum contribution requirements of section 416(c)(2) of the
Code 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. 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 section 401(m) of the
Code.

 

9.05.       Special Multiple Plan Rules.

 

(a)           General rule. For any Top-Heavy Plan Year, the term “1.0” shall be
substituted for the term “1.25” each time such term appears in the definition of
defined benefit plan fraction and the definition of the defined contribution
plan fraction as provided in Section 5.02.

 

(b)           Employees participating in only the defined benefit plan. 
Employees participating in only the defined benefit plan shall receive the
defined benefit minimum contribution required by Code section 416. Employees
participating in only this Plan shall receive the minimum allocation required
under Section 9.04

 

(c)           Employees participating in both plans.  Employees participating in
both this Plan and a defined benefit plan maintained by the Employer are not
required to receive a minimum contribution under each plan. The Plan
Administrator shall set forth which of the applicable provisions below shall
override the other terms of the Plan, to the extent necessary to satisfy the
requirements of Code section 415 and/or avoid duplication of the required
aggregation of multiple plans.

 

(1) The Employer shall provide the minimum contribution solely under this Plan,
and the minimum contribution must equal five percent (5%) of each Non-Key
Employee’s

 

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414(q) Compensation for each year with respect to which both plans are treated
as Top-Heavy; or

 

(2) The Employer shall provide the minimum benefit under the defined benefit
plan required by Code section 416 for each year with respect to which both plans
are treated as Top-Heavy; or

 

(3) The Employer shall provide the minimum benefit by a floor offset approach
(pursuant to Revenue Ruling 76-259, 1976-2 C. B. 111) under which the defined
benefit minimum is provided in the defined benefit plan and is offset by the
benefits provided under this Plan.

 

(4) The Plan Administrator shall prove, using a comparability analysis (pursuant
to Revenue Ruling 81-202, 1981-2 C. B. 93) that the plans are providing benefits
at least equal to the defined benefit minimum.

 

9.06.       Change from Top-Heavy Plan to Non Top-Heavy Plan.  In the event that
the Plan becomes a Top-Heavy Plan, such change shall be treated as a Plan
amendment which affects the vesting schedule. In the event that the Plan,
thereafter, ceases to be a Top-Heavy Plan, the effect of again following the
regular vesting schedule(s) (as specified in the Adoption Agreement) shall be
treated as a Plan amendment which affects the vesting schedule, and shall be
governed by the provisions of Section 6.04.

 

9.07        Safe Harbor Contribution Plan.  The Top-Heavy requirements of
section 416 of the Code and Sections 9.01 through 9.06 of the Plan shall not
apply in any year beginning after December 31, 2001, in which the Plan consists
solely of a cash or deferred arrangement which meets the requirements of section
401(k)(12) of the Code and Matching Contributions with respect to which the
requirements of section 401(m)(11) of the Code are met.

 

With respect to any Plan Year commencing prior to December 31, 2001, Appendix A
shall apply for purposes of determining whether the Plan is a Top-Heavy plan
under section 416(g) of the Code for Plan Years, and whether the Plan satisfies
the minimum benefits requirements of section 416(c) of the Code for such years.

 

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ARTICLE X. PLAN ADMINISTRATOR.

 

10.01.     Plan Administrator.  The Plan Sponsor shall be the Plan
Administrator, unless the Plan Sponsor, by action of its governing body,
appoints one or more individuals, or another company, as Plan Administrator. 
Any person, including, but not limited to, the Employees of the Plan Sponsor,
shall be eligible to serve as the Plan Administrator.  Any person or company so
appointed shall signify his acceptance by filing written acceptance with the
Plan Sponsor.  A Plan Administrator may resign by delivering his written
resignation to the Plan Sponsor or be removed by the Plan Sponsor by delivery,
to the Plan Administrator, of written notice of removal.  Such removal shall
take effect on the date specified in the written notice, or, if no date is so
specified, upon delivery to the Plan Administrator. Upon the resignation or
removal of a Plan Administrator, the Plan Sponsor shall promptly designate in
writing a successor to this position. If the Plan Sponsor does not appoint a
successor Plan Administrator, the Plan Sponsor shall function as the Plan
Administrator.

 

If the Plan Sponsor serves as Plan Administrator, the Plan Sponsor may, by
action of its governing body, appoint a committee consisting of more than one
(1) person (hereinafter referred to as the “Committee”) who shall assist the
Plan Administrator in the administration of the Plan.  All actions taken by the
Committee shall be deemed actions taken by the Plan Administrator, and the Plan
Administrator shall, alone, have Fiduciary responsibility in connection with
such actions, except with respect to willful misconduct or gross negligence. 
All usual and reasonable expenses of the Committee may be paid in whole or in
part by the Plan Administrator, and expenses not paid by the Plan Administrator
shall be paid by the Trustee out of the principal or income of the Trust.  The
members of the Committee shall not receive compensation with respect to their
services for the Committee.  The Committee shall have such powers as may be
necessary to discharge its duties, including all powers set forth in Section
10.03(b).  A majority of the members of the Committee shall constitute a quorum
for the transaction of business.  No action shall be taken except upon a
majority vote of the Committee members.  An individual shall not vote or decide
upon any matter relating solely to himself or vote in any case in which his
individual rights or claim to any benefit under the Plan is particularly
involved.  If, in any case in which a Committee member is so disqualified to
act, and the remaining members cannot agree, the governing body of the Plan
Sponsor shall appoint a temporary substitute member to exercise all the powers
of the disqualified member concerning the matter relating to such
disqualification.

 

10.02.     Signatures.  The Plan Administrator shall designate the person or
persons who shall be authorized to sign for the Plan Administrator.

 

10.03.     General Powers and Authority of Plan Administrator.

 

(a)           Plan Administrator is a Fiduciary.  The Plan Administrator shall
be a Named Fiduciary of the Plan.

 

(b)           Powers of Plan Administrator.  The Plan Administrator shall
control and manage the operation and administration of the Plan according to its
terms and provisions, and shall have all powers necessary to accomplish these
purposes, including, but not limited to, the sole and absolute discretion:

 

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(1) to make written rules, regulations and by-laws for the administration of the
Plan, provided such are not inconsistent with the terms and provisions of the
Plan, copies of which shall be delivered to the Trustee and to the Employer in
order to be effective;

 

(2) to construe, within its sole discretion, all terms, provisions, conditions
and limitations of the Plan (provided that, in all cases the construction which
shall be required and which shall control shall permit the Plan to comply with
ERISA or qualify under Code section 401);

 

(3) to correct any defect, supply any omission, or reconcile any inconsistency
that may appear in this Plan, in such manner and to such extent as it shall deem
expedient to carry the Plan into effect for the greatest benefit of all
interested parties;

 

(4) to select, employ and compensate such investment professionals, retirement
plan professionals, accountants, advisers, attorneys, recordkeepers,
consultants, advisors and other agents and employees as it may deem necessary or
advisable in the proper and efficient administration of this Plan;

 

(5) to determine all questions relating to eligibility for participation,
vesting and benefits, including the authority to settle, in a compromised
fashion, any disputed claims against the Plan;

 

(6) to direct the Trustee concerning the payment and distribution of the Trust
Fund;

 

(7) to establish and maintain records concerning the Accounts of the
Participants;

 

(8) to determine, through a reasoned process, the appropriate allocation of
expenses between the Plan Sponsor and the Plan;

 

(9) to file with the appropriate government agency (or agencies) annual reports,
plan descriptions, summary plan descriptions, and other pertinent documents
which may be duly requested;

 

(10) to determine the proper voting of proxy materials, except with respect to
Employer Securities (as defined in Section 11.04(a)), related to the Investment
Options (as defined in Section 11.02) or to appoint a committee to handle the
same.  Generally, a proxy will be voted to support the management proposals,
however, proposals which could be detrimental to the interests of the Plan and
the Participants will be voted against;

 

(11) to delegate to one or more officers of the Employer, or, if there is a
Committee, to one or more members of the Committee, the right to act on behalf
of the Plan Administrator in all matters connected with the administration of
the Plan and Trust;

 

(12) to delegate to one or more individuals such of the above powers and duties
as the Plan Administrator shall deem appropriate;

 

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(13) to establish reasonable contingency plans in the event there is a failure
of the written rules, regulations and by-laws for the administration of the Plan
due to the year 2000; and

 

(14) to interpret “written,” including any derivative of that term, in
accordance with statutory and regulatory provisions which impact electronic
transmissions and retention of information and documentation.

 

Notwithstanding any other provisions of this Plan to the contrary, the Plan
Administrator may establish reasonable alternative procedures to manage the
operation and administration of the Plan, in the event that there is a failure
of standard practices and procedures due to a year 2000 problem.

 

10.04.     Uniform Administration.  Whenever, in the administration of the Plan,
any action is taken by the Plan Administrator, such action shall be uniform in
nature as applied to all persons similarly situated and no such action shall be
taken which shall discriminate in favor of Participants who are officers,
shareholders, or are Highly Compensated Participants.

 

10.05.     Finality of Decision.  The decision of the Plan Administrator in
matters within its jurisdiction involving the Plan shall be final, binding and
conclusive upon the Employer and upon each Employee, Participant, Beneficiary,
alternate payee and every other person or party.  The Plan Administrator shall
have the exclusive discretionary authority to construe the terms of the Plan,
and the exclusive discretionary authority to determine eligibility for all
benefits hereunder.  Any such determination and/or interpretation, of the Plan,
adopted by the Plan Administrator shall be final and conclusive and shall bind
all parties.

 

10.06.     Self Interest of Participant.  No agent or representative of the Plan
Administrator shall have any right to vote or decide upon any matter relating
solely to himself, or to any of his rights, or benefits under the Plan.

 

10.07.     Plan Records.  The Plan Administrator shall keep appropriate records
of its acts and determinations in the administration of the Plan, and shall make
such records as they pertain to any Participant or Beneficiary available for
examination by such Participant, Beneficiary, or alternate payee during normal
business hours.

 

10.08.     Bonding and Liability of Plan Administrator.  A bond or other
security shall be required of any individual empowered to act on behalf of the
Plan Administrator to the extent required by ERISA. The Employer shall indemnify
and save such individuals, and hold each of them harmless from the effects and
consequences of their acts, their omissions and conduct in their official
capacity, except to the extent that such effects and consequences shall result
from their own willful misconduct or gross negligence.

 

10.09.     Reporting and Disclosure.  The Plan Administrator shall file or cause
to be filed with the appropriate offices of the Internal Revenue Service and the
Department of Labor all reports, returns, notices and other information required
under ERISA, the Code, or applicable regulations and shall provide the
Participants and their Beneficiaries, and any alternate payees with such
information as may be required by ERISA, the Code, or any applicable
regulations.

 

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10.10.     Power and Responsibilities of the Employer.

 

(a)           Duties.  The Employer shall supply all such information to the
Plan Administrator and the Trustee as is necessary for each to fulfill its
duties hereunder.

 

(b)           Power to appoint Trustee and Plan Administrator.  The Employer
shall be empowered to appoint and remove the Trustee, Additional Trustees,
Successor Trustees, Joint Trustees, Co-Trustees and/or the Plan Administrator
from time to time as it deems necessary for the proper administration of the
Plan.

 

(c)           Funding policy method.  The Employer shall establish a “funding
policy and method,” i.e., it shall determine whether the Plan has a short term
need for liquidity (e.g., to pay benefits) or whether liquidity is a long term
goal and investment growth (and stability of the same) is a more current need,
or may appoint a qualified party to do so.  The Employer or its delegate shall
communicate such needs and goals to the Trustee, who shall coordinate such Plan
needs with its investment policy.  The communication of such a “funding policy
and method” shall not, however, constitute a directive to the Trustee as to
investment of the Trust Funds.  Such funding policy and method shall be
consistent with the objectives of this Plan and with the requirements of Title I
of ERISA.

 

(d)           Service of legal process.  The Employer shall serve as agent for
the service of legal process at its principal office.

 

(e)           Performance reviews.  The Employer shall periodically review the
performance of any Fiduciary or other person to whom duties have been delegated
or allocated by it under the provisions of this Plan or pursuant to procedures
established hereunder.  This requirement may be satisfied by formal periodic
review by the Employer or by a qualified party specifically designated by the
Employer, through day-to-day contact and evaluation, or through other
appropriate means.

 

10.11.     Payment of Expenses.  All expenses of administration not paid by the
Employer or charged to the Participant shall be paid out of the Trust Fund. Such
expenses shall include any reasonable expenses incident to the administration of
the Plan, including, but not limited to, reasonable fees of retirement plan and
investment professionals, accountants, counsel, consultants, advisers and other
specialists and their agents, and other costs of administering the Plan,
including, but not limited to, fees associated with any investment option or
with activities related to Participants and their Accounts (e.g., processing
loans, hardship withdrawals, or investment direction).  Until paid, the expenses
shall constitute a liability of the Trust Fund.  However, the Employer may
reimburse the Trust Fund for any administration expenses incurred. Any
administration expenses paid to the Trust Fund as a reimbursement shall not be
considered an Employer contribution.

 

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ARTICLE XI. PARTICIPANT DIRECTION OF INVESTMENTS.

 

11.01.     Participant-Directed Investment Account. Unless otherwise specified
in the Adoption Agreement, each Participant shall be empowered to direct the
investment of his monies in all his Accounts among the Investment Options made
available under the Plan.  In this regard, unless otherwise specified in the
Adoption Agreement, the Plan shall be intended to be an ERISA section 404(c)
plan and, thereby, the Plan Fiduciaries may be relieved of liability for losses
which may occur as a result of Participants’ investment direction.
Notwithstanding the general and specific powers granted the Trustee under the
Trust, the Trustee shall invest all or a portion of the Participants’ Accounts
in the amounts and manner set forth in this Article, unless otherwise specified
in the Adoption Agreement.  The transfers of monies between Investment Options
shall be invested at the direction of the Plan Administrator.  The amounts and
timing of the transfers shall be provided in the form of written instruments
from the Plan Administrator to the Trustee.

 

11.02.     Investment Options  The Employer, with the consent of the Trustee,
shall establish, maintain and make available to Participants a selection of
options for the investment of all Participants’ Accounts.  The Employer, with
the consent of the Trustee, shall select these options from time to time in its
sole discretion.  Such options shall be referred to herein as Investment
Options.  At any time, the Trustee or Employer may, at their sole discretion,
close any option to future purchases.  Investment Options may have different
investment objectives and varying degrees of risk and potential for
appreciation.  Such Investment Options may include, without limitation, shares
of registered investment companies, pooled separate accounts of life insurance
companies, single or commingled trust offered by a bank, group annuity contracts
with life insurance companies, employer securities, limited partnerships, and
certificates of deposit, or any combination thereof.  The Employer shall provide
such investment information as shall be necessary to comply with the regulations
issued pursuant to ERISA section 404(c).

 

11.03.     Investment Direction.

 

(a)           Investment election.  A Participant who has established any
Account within the Plan shall, by filing a written direction with the Plan
Administrator, specify the percentage of his Accounts which are to be invested
in each of the Investment Options described in Section 11.02. The Plan
Administrator may limit the percentage alternatives available in a uniform and
non-discriminatory manner. Any investment direction given by a Participant shall
be deemed to be a continuing direction until changed.

 

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(b)           Absence of affirmative direction.  If a Participant fails to
provide the Plan with an investment direction, the Plan Administrator will
direct the investment of the Participant’s account, until such time as the
Participant provides his or her first affirmative direction.  In consideration
of the risk tolerances, time horizons and investment needs of the average
Participant, and of the common investment allocations of large retirement plans,
Accounts for Participants who do not affirmatively select their investment
options will be invested according to the percentage allocations of the moderate
asset allocation model.  Such monies will continue to be invested using the
percentage allocations of that model until and unless the Plan Administrator
decides to change this decision for all Participants who have not provided
investment directions or until the Plan Administrator determines that a
different investment selection is appropriate for a Participant.  In making
these decisions, the Plan Administrator is not responsible for inquiring into
the specific goals or needs of a Participant.

 

(c)           Change of investment election.  As of the beginning of the Plan
Year, and at least quarterly thereafter (unless otherwise specified in the
Adoption Agreement), and at any other time so designated by the Plan
Administrator, a Participant may, by a writing filed with the Plan
Administrator, establish new investment directions. The Plan Administrator may
implement such procedural rules it deems necessary to permit the transfer among
the Investment Options.

 

(d)           Transfers between options.  Participants shall be provided with a
reasonable opportunity to give investment instructions in writing to the Plan
Administrator, who shall comply with such instructions.  The Plan Administrator
shall decline instructions which would generate income that would be taxable to
the Trust. The Plan Administrator shall also establish limitations on the
frequency with which a Participant may give investment instructions.  Compliance
with such instructions shall at all times be subject to any restrictions
provided under the applicable contracts with the investment products.

 

(e)           Oral instructions.  The Plan Administrator may, at its sole
discretion, establish procedures to receive investment instructions orally.  If
such procedures are established, any oral instruction shall be followed by a
written confirmation of such instructions and shall be sent to the Participant
by first class mail or other reasonable means.

 

(f)            Other restrictions.  If a Plan is subject to the provisions of
this Article, and a Participant or Beneficiary requests a distribution of his
benefits, the timing, manner and form of any such distribution shall be subject
to the conditions and obligations of the investment option or options selected
by the Participant, as well as those of the Plan.  Furthermore, the Plan
Administrator shall have the authority, for administrative reasons, to instruct
the Trustee to transfer monies to a segregated option that is a federally
insured savings account, certificate of deposit in a bank or savings and loan
association, money market option, or other short-term debt security acceptable
to the Trustee until such time as an allocation pursuant to this Plan can be
made.  Such administrative reasons shall include, but are not limited to, the
transfer of monies from another plan to this Plan, the liquidation of an
investment option, the delivery of monies to the Trust upon the maturity of
bonds or Guaranteed Investment Contracts or other such instruments, and upon the
termination or partial termination of the Plan.  Also, the Employer and/or the
Trustee shall have the power to liquidate options and transfer them to one or
more segregated accounts, as described in the

 

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preceding sentence, if the Employer and/or the Trustee believes it is prudent to
do so in light of the Employer’s and/or Trustee’s fiduciary duties to the Plan’s
Participants.  The Employer and/or Trustee shall have the authority to take such
actions, without any prior notice to Participants, but shall notify the Plan
Administrator of the Trustee’s action as soon as practicable thereafter.  The
Plan Administrator shall notify the affected Participants and Beneficiaries
within 90 days of any such transfer.

 

11.04      Investment Direction – Employer Securities.

 

(a)           Definitions.  For purposes of this Article the following
definition applies:

 

(1) Employer Securities – means shares of common stock issued by the Plan
Sponsor, as identified in the Adoption Agreement.

 

(2) Responsible Fiduciary – means the individual or party identified in the
Adoption Agreement

 

(3) Qualifying Employer Securities - The investment options available under the
Plan include the ability to invest in “qualifying employer securities”, as
defined in Section 407(d)(5) of ERISA, which specifically includes the common
stock of the Employer, Sonic Corp. (hereinafter referred to as “Employer
Securities”).  The Trustee is expressly authorized to invest so much of the
Trust Fund (up to 100%) in Employer Securities as is necessary to invest
contributions in accordance with the directions of the Employer, Participants
and/or Advisory Committee.  Purchases of Employer Securities shall be on the
open market, in a private placement or from the Employer.

 

Any contribution by the Employer required or permitted under the Plan may be
made in Employer Securities.  If Employer Securities are purchased or
transferred in-kind from the Employer, the sales price (or value, if the
Employer Securities are contributed in-kind) shall be no greater than the lesser
of, as reported on a national securities exchange registered with the United
States Securities and Exchange Commission including the National Association of
Securities Dealers Automated Quotation System:  (i) the closing price of the
Employer Securities on the trading day immediately preceding the date the
Employer Securities are acquired by the Plan, or (ii) the average of the closing
prices of the Employer Securities for the twenty (20) consecutive trading days
immediately preceding the date as of which the Employer Securities are acquired
by the Plan.  No commissions or other fees shall be payable with respect to any
transaction with the Employer.

 

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(b)                                  Investment Election – Employer Securities.

 

(1)   Participant Election - If provided for in the Adoption Agreement, a
Participant may file a written direction with the Plan Administrator specifying
which percentage of his Accounts are to be invested in Employer Securities.  The
Plan Administrator may limit the Accounts and the percentage alternatives
available to be invested in Employer Securities in a uniform and
non-discriminatory manner.  Any restrictions on transferring from or into
Employer Securities will be specified in the Adoption Agreement and comply with
federal securities law.

 

(2)  Employer Contributions and Forfeitures.  In the event that Employer
Contributions are invested in Employer Securities, as specified in the Adoption
Agreement, a Participant may elect, in accordance with procedures established by
the Plan Administrator, to transfer (and the Adoption Agreement shall specify if
such transfer is irrevocable) a percentage of the amounts in his Employer
Contributions that are invested in Employer Securities pursuant to the
restrictions identified in the Adoption Agreement.

 

(c)                                  Proxy Voting – Employer Securities.   When
the Plan Sponsor files preliminary or final proxy solicitation materials with
the Securities and Exchange Commission, the Plan Sponsor shall cause a copy of
all materials to be simultaneously sent to the Responsible Fiduciary.  Based on
these materials, the Responsible Fiduciary will ensure that a voting instruction
form is prepared.  At the time of mailing of notice of each annual or special
stockholders’ meeting of the Plan Sponsor, the Plan Sponsor shall cause a copy
of the notice and all proxy solicitation materials to be sent to each
Participant and Beneficiary with an interest in Employer Securities held in the
Trust, together with the foregoing voting instruction form to be returned to the
Responsible Fiduciary or its designee.  The Responsible Fiduciary shall provide
the Trustee with a copy of any materials provided to the Participants and
Beneficiaries and shall certify to the Trustee that the materials have been
mailed or otherwise sent to the Participants and Beneficiaries.

 

Each Participant and Beneficiary with an interest in Employer Securities held in
the Trust shall have the right to direct the manner in which to vote the number
of shares of the Employer Securities reflecting such Participant’s or
Beneficiary’s proportional interest in the Employer Securities held in the Trust
(both vested and unvested).  Directions from a Participant or Beneficiary to the
Responsible Fiduciary concerning the voting of the Employer Securities shall be
communicated in a then acceptable written format.  These directions shall be
held in confidence by the Responsible Fiduciary and shall not be divulged to the
Plan Sponsor, or any officer or employee thereof, or any other person.  Upon its
receipt of the directions, the Responsible Fiduciary shall direct the Trustee on
how to vote the shares of the Employer Securities reflecting the Participant’s
or Beneficiary’s proportional interest in the Employer Securities held in the
Trust as directed by the Participant.

 

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Shares of the Employer Securities reflecting Participant’s or Beneficiary’s
proportional interest in the Employer Securities held in the Trust (both vested
and unvested) for which it has received no directions from Participants or
Beneficiaries shall be voted in the same proportion on each issue as it votes
those shares for which it received voting directions from Participants and
Beneficiaries.  Shares of the Employer Securities not credited to Participants’
or Beneficiaries’ Accounts shall be voted in the same proportion on each issue
as it votes those shares credited to Participants’ or Beneficiaries’ Accounts
for which it received voting directions from Participants or Beneficiaries.  If
the Responsible Fiduciary determines that it would be imprudent to vote shares
of Employer Securities in the manner described herein, he or she will change the
manner in which shares are voted so as to comply with his or her fiduciary
responsibilities under the applicable law.

 

(d)                                  Tender Offers – Employer Securities.   Upon
commencement of a tender offer for any securities held in the Trust that are
Employer Securities, the Responsible Fiduciary shall notify each Participant or
Beneficiary of the tender offer and utilize its best efforts to timely
distribute or cause to be distributed to each Participant or Beneficiary the
same information that is distributed to other stockholders of the Plan Sponsor
in connection with the tender offer.  The Plan Sponsor shall provide the
Responsible Fiduciary with a copy of any material provided to the Participants
and Beneficiaries.  The Responsible Fiduciary shall certify to the Trustee that
the materials have been mailed or otherwise sent to Participants and
Beneficiaries.

 

Each Participant and Beneficiary shall have the right to direct the Responsible
Fiduciary to tender or not to tender some or all of the shares of the Employer
Securities reflecting his proportional interest in the Employer Securities held
in the Trust (both vested and unvested).  Directions from a Participant or
Beneficiary to the Responsible Fiduciary concerning the tender of the Employer
Securities shall be communicated in a then acceptable written format.  These
directions shall be held in confidence by the Responsible Fiduciary and shall
not be divulged to the Plan Sponsor, or any officer or employee thereof, or any
other person except to the extent that the consequences of such directions are
reflected in reports regularly communicated to any such persons in the ordinary
course of the performance of the Responsible Fiduciary’s services hereunder. 
The Responsible Fiduciary shall tender shares of Employer Securities as directed
by the Participant or Beneficiary.  To the extent that Participants and
Beneficiaries fail to affirmatively direct the Responsible Fiduciary or fail to
issue valid directions to the Responsible Fiduciary to tender shares of the
Employer Securities credited to their Accounts, they will be deemed to have
instructed the Responsible Fiduciary not to tender those shares.  Accordingly,
the Responsible Fiduciary shall not tender shares of Employer Securities
credited to a Participant’s or Beneficiary’s Accounts for which it has received
no directions or invalid directions from him.

 

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The Responsible Fiduciary shall tender that number of shares of the Employer
Securities not credited to the Participants’ and Beneficiaries’ Accounts which
is determined by multiplying the total number of shares of the Employer
Securities not credited to Participants’ and Beneficiaries’ Accounts by a
fraction of which the numerator is the number of shares of the Employer
Securities credited to Participants’ and Beneficiaries’ Accounts for which the
Responsible Fiduciary has received valid directions from Participants and
Beneficiaries to tender (which directions have not been withdrawn as of the date
of this determination) and of which the denominator is the total number of
shares of the Employer Securities credited to the Participants’ and
Beneficiaries’ Accounts.

 

A Participant who has directed the Responsible Fiduciary to tender any or all of
the shares of Employer Securities credited to such Participant’s Accounts may,
at any time prior to the tender offer withdrawal deadline, instruct the
Responsible Fiduciary to withdraw, and the Responsible Fiduciary shall withdraw,
such shares from the tender offer prior to the tender offer withdrawal deadline
if such instructions are received reasonably prior to such deadline to allow the
Responsible Fiduciary to withdraw such shares.  A Participant shall not be
limited by the Responsible Fiduciary as to the number of instructions to tender
or withdraw that the Participant may give to the Responsible Fiduciary, except
to the extent a tender offer contains any such limitation. Prior to the
withdrawal deadline, if any shares of the Employer Securities not credited to
Participants’ or Beneficiaries’ Accounts have been tendered, the Responsible
Fiduciary shall redetermine the number of shares of the Employer Securities that
would be tendered under this Section if the date of the foregoing withdrawal
were the date of determination, and withdraw from the tender offer the number of
shares of the Employer Securities not credited to Participants’ or
Beneficiaries’ Accounts necessary to reduce the amount of tendered Employer
Securities not credited to Participants’ or Beneficiaries’ Accounts to the
amount so redetermined.  A Participant or Beneficiary shall not be limited as to
the number of directions to tender or withdraw that he may give to the
Responsible Fiduciary.

 

An instruction by a Participant to the Responsible Fiduciary to tender the
shares of Employer Securities credited to such Participant’s Accounts shall not
be considered a written election by the participant to withdraw, or have
distributed, any or all of his Accounts which are subject to withdrawal.  The
Responsible Fiduciary shall advise the Advisory Committee to credit, to the
Participant’s Accounts from which the tendered shares were taken, the proceeds
received by the Responsible Fiduciary or Trustee, whichever is applicable, in
exchange for the shares of Employer Securities, if any, so tendered from each
such Account.

 

The Responsible Fiduciary will comply with the provisions of this Section
11.04(d) unless he or she determines that it is imprudent to do so, in which
case he or she will carry out the provisions of this Section in a manner which
complies with his or her fiduciary responsibilities under applicable law.

 

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Any instruction or other communication by a Participant to the Responsible
Fiduciary concerning any tender offer matter shall be held in confidence by the
Responsible Fiduciary and shall not be divulged to the Employer or to any
officer or employee thereof nor to any other person, except as required by law.

 

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ARTICLE XII. PARTICIPANT LOANS.

 

12.01.     Availability of Loans.  The Plan may permit a Participant to obtain a
loan from the Plan.  The Plan’s written loan policy shall set forth all loan
rules and restrictions.

 

12.02.     Loan Policy.  The Loan Policy shall be a written document setting
forth the specific provisions for Participant loans, and is herein incorporated
as part of the Plan by reference. A signed copy of the Loan Policy shall be kept
on file by the Plan Administrator, and also shall be set forth in the Summary
Plan Description for the Plan. The Loan Policy shall include (1) the identity of
the person or position authorized to administer the Participant Loan program;
(2) a procedure for applying for loans; (3) the basis on which loans shall be
approved or denied; (4) limitations (if any) on the types and amounts of loans
offered; (5) the procedure under the program for determining a reasonable rate
of interest; (6) the types of collateral which may secure a Participant loan;
(7) the events constituting default and the steps that shall be taken to
preserve Plan assets in the event of such default; and (8) all other information
sufficient to apprise all possible borrowers of the scope and procedures of the
loan program.  Loans shall be available to Plan Participants on a
nondiscriminatory basis without regard to any individual’s race, color,
religion, sex, age or national origin.

 

12.03.     Loan Documents.  The originals of all promissory notes and other
forms requested by the Trustee in respect of any loan shall be retained by the
Trustee (or an authorized representative of the Trustee), or the Plan
Administrator (or an authorized representative of the Plan Administrator) as
long as the loan is outstanding.

 

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ARTICLE XIII. ADOPTION, TERMINATION AND RELATED MATTERS.

 

13.01.     Adoption Agreement.  The Employer shall adopt this Plan by its
Adoption Agreement complete in every respect and agreeing to be bound as an
Employer by all the terms of the Plan with respect to its Eligible Employees.
The Adoption Agreement shall specify the Effective Date of such adoption of the
Plan and shall become, to such Employer and its Employees, a part of this Plan.
The Employer shall be solely responsible for establishing and maintaining the
tax-qualified status of this Plan.

 

13.02.     Right to Amend Reserved.

 

(a)           Right to Amend.  The Employer, by action of its corporate
officers, general manager (if applicable), managing partner (if applicable), or
any individual appointed pursuant to Section 10.01 (regarding the Plan
Administrator), shall have the right at any time and from time to time to amend
the Plan, subject to the limitations of this Section 13.02(a).  However, any
amendment which affects the rights, duties or responsibilities of the Trustee or
Plan Administrator, may only be made with the Trustee’s and Plan Administrator’s
written consent.

Notwithstanding the immediately preceding paragraph, an amendment shall require
the approval or ratification of the Plan Sponsor’s Board of Directors if the
effect of such amendment is to:

 

(1)  terminate the Plan;

(2)  cease benefit accruals or contributions;

(3)  significantly change the cost of funding or operating the Plan;

(4)  restate the Plan;

(5)  effect a permissible change which materially affects Participants’ rights;

(6)  otherwise significantly alter the Plan Sponsor’s rights, liabilities and
burdens with respect to the Plan.

 

(b)           No Protected Benefit may be eliminated.  No amendment to the Plan
shall eliminate a Protected Benefit, except to the extent permitted under
Regulation section 1.411(d)(6).

 

13.03.     Limitations on Employer’s Right to Amend. No such amendment shall,
without a Participant’s consent (except as otherwise specifically permitted
under this Plan), deprive, limit, lessen or restrict any vested right or
interest to which any Participant is already entitled under the Plan.
Furthermore, no such amendment may decrease the Vested Balance of a Participant,
nor may it eliminate or reduce an Early Retirement benefit, nor may it eliminate
a Protected Benefit.

 

13.04.     Right to Terminate.  The Employer reserves the right to terminate the
Plan in whole or in part with respect to its Employees at any time by giving
written notice to the Trustee. Any such notice shall designate the Effective
Date of such termination. Upon the termination or partial termination of the
Plan by an Employer with respect to its Employees by an Employer, the affected
Participants with respect to whom the Plan has wholly or partially terminated,
shall be 100% vested in their Accounts.  After payment of all expenses, and the
proportionate adjustment of Participants’ Accounts to reflect such expenses, net
income or loss of the Trust Fund and allocation to date of

 

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termination, and requirements of section 401(k)(2)(B) of the Code, benefits
shall be distributed to each Participant, as soon as administratively
practicable, as provided herein. The Employer may notify the Internal Revenue
Service in writing of such termination with respect to its Employees.

 

Upon such termination, the Employer may distribute all amounts held under the
Plan except, however, that amounts attributable to salary deferrals shall not be
distributed if the affected Participants shall be employed by a successor
employer maintaining a qualified plan with a salary deferral arrangement.

 

13.05.     Suspension of Contributions.  In the event of a complete
discontinuance of substantial Employer contributions to this Plan, the vested
percentage of each Participant in his Employer Account shall be 100%.

 

13.06.     Merger, Partial Merger, Consolidation, and Transfer of Assets.  This
Plan and Trust may be merged, partially merged, or consolidated with, or assets
and/or liabilities may be transferred to, or from, any other plan and trust only
if the benefits which would be received by a Participant of this Plan, in the
event of a termination of the Plan immediately after such transfer, merger or
consolidation, are at least equal to the benefits the Participant would have
received if the Plan had terminated immediately before such transfer, merger or
consolidation, and such transfer, merger or consolidation does not otherwise
result in the elimination or reduction of any Protected Benefit, nor cause any
Participant to vest less rapidly in any Employer Account than would have
otherwise been the case prior to said transfer, merger, or consolidation.

 

Unless specifically prohibited in the Adoption Agreement, the Plan shall accept
assets transferred from a Plan qualified under Code section 401(a).  Upon the
transfer of any assets or liabilities in connection with the merger, partial
merger, or consolidation of another plan qualified under Code section 401(a)
with this Plan, the Plan Administrator may direct that the total of Employee
transfers made in cash after a Valuation Date be segregated into a separate
account for each Participant in a federally insured savings account, certificate
of deposit in a bank or savings and loan association, money market fund, or
other short-term debt security acceptable to the Trustee until such time as the
allocations pursuant to this Plan have been made, at which time they may remain
segregated or be invested as part of the general Trust Fund, to be determined by
the Plan Administrator.

 

Any amounts transferred to this Plan from another plan, as described in the
preceding paragraph, that are attributable to contributions from the Employer
that maintained such plan, shall be fully vested upon such merger, unless
otherwise provided in the Adoption Agreement or in an amendment to the Plan
addressing such transfer, merger, or consolidation.

 

13.07.     Partial Termination.  Upon a determination by the Plan Administrator
in its sole and absolute discretion, that a partial termination of the Plan has
occurred with respect to a group of Participants, the Trustee shall, in
accordance with the directions of the Plan Administrator, allocate and segregate
for the benefit of the affected Employees then or theretofore employed by the
Employer with respect to which the Plan is being terminated the proportionate
interest of such Participants in the Trust Fund. The funds so allocated and
segregated shall be used by the Trustee to pay benefits to or on behalf of
Participants in accordance with Section 13.08.

 

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13.08.     Liquidation of the Trust Fund.  Upon termination or partial
termination of the Plan, the Accounts of all Participants affected thereby shall
become fully vested, and the Plan Administrator shall direct the Trustee to
implement either subsection (a) or (b) below.

 

(a)           Continuing the Trust.  Under this option, the Trustee shall
continue to administer the Trust Fund and pay Account balances in accordance
with Section 7.07, to Participants affected by the termination upon their
termination of employment or to their Beneficiaries upon such a Participant’s
death, until the Trust Fund has been liquidated.

 

(b)           Liquidating the Trust.  Under this option, the Trustee shall, as
soon as administratively practicable, distribute the assets remaining in the
Trust Fund, after payment of any expenses properly chargeable thereto, to
Participants, Former Participants and Beneficiaries in proportion to their
respective Account balances. In case the Plan Administrator directs liquidation
of the Trust Fund pursuant to paragraph (a) of this Section, the expenses of
administering the Plan and Trust, if not paid by the Employer, shall be paid
from the Trust Fund.  A liquidation of the Trust Fund may be delayed in the
event the Employer has made an application with the Internal Revenue Service for
a determination of the Plan’s qualified status upon termination and such
liquidation is pending a favorable determination.

 

13.09.     Manner of Distribution.  To the extent that no discrimination in
value results, any distribution after termination of the Plan may be made, in
whole or in part, in cash, in securities or other assets in kind, or in
non-transferable annuity contracts, as the Plan Administrator shall determine.
All non-cash distributions shall be valued at fair market value as of the date
of distribution. Distributions due to the termination or partial termination of
the Plan shall be made in accordance with the modes of distribution provided for
in the Plan. Except, however, that in the event of the termination of the Plan
and liquidation of the Trust, distributions shall only be made in a lump sum
unless the Adoption Agreement provides for the purchase of annuities.

 

13.10.     No Reversion to Employers.  Except as provided herein, no portion of
the principal or the income of the Trust Fund shall revert to or be recoverable
by the Employer (or any Participating Employer) or ever be used for or diverted
to any purpose other than for the exclusive benefit of the Participants,
Beneficiaries or alternate payees, provided, however, that:

 

(a)           Deductibility.  All Employer contributions are conditioned upon
the deductibility of the contributions under section 404 of the Code, then, to
the extent the deduction is disallowed, the Plan shall, upon written request of
the Employer (or Participating Employer), return such amounts as may be
permitted by law to such Employer (or Participating Employer) as appropriate,
within one year after the date the deduction is disallowed; and

 

(b)           Mistake of Fact.  If a contribution or any portion thereof is made
by the Employer (or Participating Employer) by a mistake of fact, the Plan
shall, upon written request of the Employer, return such amounts as may be
permitted by law to the Employer (or Participating Employer), within one year
after the date of payment to the Trust; and

 

(c)           Initial Qualification.  All Employer contributions are conditioned
upon the initial qualification of the Plan and Trust under Code sections 401 and
501.  The contributions of

 

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the Employer (or of a Participating Employer) to the Trust for all Plans Years,
with the gains and losses thereon, shall be returned by the Plan to the Employer
(or such Participating Employer), within one year in the event that the
Commissioner of the Internal Revenue Service either issues an adverse
determination on the initial qualification of the Plan and Trust or fails to
rule that the Plan and Trust were as of such date qualified and tax-exempt
(within the meaning of Code sections 401 and 501); and

 

(d)           Other Allowable Provisions.  Assets may be returned to the
Employer (or Participating Employer) to the extent such return is permitted by
ERISA, the Code, the Income Tax Regulations, Department of Labor Regulations, or
any other authorities or guidance issued by the United States Department of
Treasury, the Internal Revenue Service, or the Department of Labor.

 

13.11.     Determination of Returned Amount.  Provided, however, that the return
of any contributions to the Employer (or Participating Employer) pursuant to
Section 13.10 (a), (b) or (d), shall satisfy the following requirements:

 

(a)           the amount returned shall not exceed the amount which would have
been contributed had there been no error in determining the deduction or mistake
of fact, as the case may be;

 

(b)           the amount returned shall not include the earnings attributable to
such contributions;

 

(c)           the amount returned shall be reduced by any losses attributable to
such contributions;

 

(d)           the individual Account of any Participant (or Beneficiary or
alternate payee) shall not be reduced, by the return of such contributions, to
less than such Account would have been had the returned contributions never been
made.

 

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ARTICLE XIV. PARTICIPATING EMPLOYERS.

 

14.01.     Adoption By Other Employers.  Notwithstanding anything herein to the
contrary, with the consent of the Employer and Trustee, any other corporation or
entity, whether an Affiliate or subsidiary or not, may adopt this Plan and all
of the provisions hereof, and participate herein and be known as a Participating
Employer, by delivering to the Employer and Trustee a properly executed document
evidencing said intent and will of such Participating Employer.

 

14.02.     Requirements of Participating Employers.

 

(a)           Trustee.  Unless otherwise specifically provided in the Adoption
Agreement, each such Participating Employer shall be required to use the same
Trustee as provided in this Plan, or as provided in such separate Trust
Agreement as shall be specified in the Adoption Agreement.

 

(b)           Trust Funds.  The Trustee may, but shall not be required to,
commingle, hold and invest as one Trust Fund all contributions made by
Participating Employers, as well as all increments thereof.  However, the assets
of the Plan shall, on an ongoing basis, be available to pay benefits to all
Participants and Beneficiaries under the Plan without regard to the Employer or
Participating Employer who contributed such assets.

 

(c)           Transfers.  The transfer of any Participant from or to the
Employer or a Participating Employer, whether an Employee of the Employer or a
Participating Employer, shall not affect such Participant’s rights under the
Plan, and all amounts credited to such Participant’s Account as well as his
accumulated service time with the transferor or predecessor, and his length of
participation in the Plan, shall continue to his credit.

 

(d)           Participant rules.  All rights and values forfeited by termination
of employment shall inure, in accordance with Section 4.06(f), only to the
benefit of the Participants of the Employer or Participating Employer by which
the forfeiting Participant was employed, except if the Forfeiture is for an
Employee whose Employer is an Affiliated Employer (as defined in Section 1.19),
then said Forfeiture shall inure to the benefit of the Participants of those
employers who are Affiliates, unless otherwise provided in the Adoption
Agreement.  Should an Employee of one (“First”) Employer be transferred to an
associated (“Second”) Employer which is an Affiliate, such transfer shall not
cause his Account balance (generated while an Employee of the “First” Employer)
in any manner, or by any amount to be forfeited.  Such Employee’s Participant
Account balance for all purposes of the Plan, including length of Service, shall
be considered as though he had always been employed by the “Second” Employer,
and as such had received contributions, Forfeitures, earnings or losses, and
appreciation or depreciation in value of assets totaling the amount so
transferred.

 

(e)           Expenses.  Any expenses of the Trust which are to be paid by the
Employer or borne by the Trust Fund shall be paid by each Participating Employer
in the same proportion that the total amount standing to the credit of all
Participants employed by such Employer bears to the total standing to the credit
of all Participants.

 

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14.03.     Designation of Agent.  Each Participating Employer shall be deemed to
be a part of this Plan; provided, however, that with respect to all of its
relations with the Trustee and the Plan Administrator for the purpose of this
Plan, each Participating Employer shall be deemed to have designated irrevocably
the Employer as its agent.  Unless the context of the Plan clearly indicates the
contrary, the word “Employer” shall be deemed to include each Participating
Employer as related to its adoption of the Plan.

 

14.04.     Employee Transfers.  It is anticipated that an Employee may be
transferred between Participating Employers, and in the event of any such
transfer, the Employee involved shall carry with him his accumulated Service and
eligibility.  No such transfer shall effect a termination of employment
hereunder, and the Participating Employer to which the Employee is transferred
shall thereupon become obligated hereunder with respect to such Employee in the
same manner as was the Participating Employer from whom the Employee was
transferred.

 

14.05.     Participating Employer’s Contribution.

 

(a)           In general.  A Participating Employer’s Contributions shall be
applied according to one of the following methods as specified in the Adoption
Agreement:

 

(1) All contributions made by a Participating Employer and the allocation of
related Forfeitures, as provided for in this Plan, shall be determined
separately by each Participating Employer, and shall be paid to and held by the
Trustee for the exclusive benefit of the Employees of such Participating
Employer and the Beneficiaries of such Employees, subject to all the terms and
conditions of this Plan.  On the basis of the information furnished by the Plan
Administrator, the Trustee shall keep separate books and records concerning the
affairs of each Participating Employer hereunder and as to the Accounts and
credits of the Employees of each Participating Employer.

 

(2) Any contribution or Forfeiture subject to allocation during each Plan Year
shall be allocated among all Participants of all Participating Employers in
accordance with the provisions of this Plan.  On the basis of the information
furnished by the Plan Administrator, the Trustee shall keep separate books and
records concerning the affairs of each Participating Employer hereunder and as
to the Accounts and credits of the Employees of each Participating Employer.

 

(b)           Contracts.  The Trustee may, but need not, register contracts so
as to evidence that a particular Participating Employer is the interested
Employer hereunder, but in the event of an Employee transfer from one
Participating Employer to another, the employing Employer shall immediately
notify the Trustee thereof.

 

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14.06.     Amendment.  Amendment of this Plan shall only be done by the
Employer, and with the consent of the Trustee, where such consent is necessary
in accordance with the terms of the Plan.  Written action by each and every
Participating Employer, and with the consent of the Trustee where such consent
is necessary in accordance with the terms of the Plan or the Adoption Agreement,
shall only be required if so provided in the Adoption Agreement.

 

14.07.     Discontinuance of Participation.  Any Participating Employer shall be
permitted to discontinue or revoke its participation in the Plan.  At the time
of any such discontinuance or revocation, satisfactory evidence thereof and of
any applicable conditions imposed shall be delivered to the Trustee.  The
Trustee shall thereafter transfer, deliver and assign Contracts and other Trust
Fund assets allocable to the Participants of such Participating Employer to such
new Trustee as shall have been designated by such Participating Employer, in the
event that it has established a separate plan qualified under Code section
401(a) for its Employees; provided, however, that no such transfer shall be made
if the result is the elimination or reduction of any Protected Benefit.  If no
successor is designated, the Trustee shall retain such assets for the Employees
of said Participating Employer pursuant to the provisions of Article XII hereof,
or the provisions of such separate Trust Agreement as shall be in effect (as
provided in the Adoption Agreement).  In no such event shall any part of the
corpus or income of the Trust as it relates to such Participating Employer be
used for or delivered for purposes other than the exclusive benefit of the
Employees (and their Beneficiaries) of such Participating Employer.

 

14.08.     Plan Administrator’s Authority.  The Plan Administrator shall have
authority to make any and all necessary rules or regulations, binding upon all
Participating Employers and all Participants, to effectuate the purpose of this
Article.

 

14.09.     Participating Employer’s Contribution for Affiliate.  If any
Participating Employer is prevented in whole or in part from making a
contribution to the Trust Fund which it would otherwise have made under the Plan
by reason of having no current or accumulated earnings or profits, or because
such earnings or profits are less than the contribution which it would otherwise
have made, then, pursuant to Code section 404(a)(3)(B), so much of the
contribution which such Participating Employer was so prevented from making may
be made, for the benefit of the participating Employees of such Participating
Employer, by the other Participating Employers who are members of the same
affiliated group within the meaning of Code section 1504, to the extent of their
current or accumulated earnings or profits.  However, any such contribution by
each such other Participating Employer shall be limited to the proportion of its
total current and accumulated earnings or profits remaining after adjustment for
its contribution to the Plan made without regard to this paragraph which the
total prevented contribution bears to the total current and accumulated earnings
or profits of all the Participating Employers remaining after adjustment for all
contributions made to the Plan without regard to this paragraph.  A
Participating Employer, on behalf of whose Employees a contribution is made
under this paragraph, shall not reimburse the contributing Participating
Employers.

 

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ARTICLE XV. MISCELLANEOUS PROVISIONS.

 

15.01.     Named Fiduciaries and Allocation of Responsibility.  The Named
Fiduciaries of this Plan are (1) the Employer and (2) the Plan Administrator. 
The Named Fiduciaries shall have only those powers, duties, responsibilities,
and obligations as are specifically given them under the Plan.  In general, the
Employer shall have sole and absolute discretion for making the contributions
provided for under Article III, and shall have sole and absolute discretion to
appoint and remove the Trustee and the Plan Administrator; to formulate the
Plan’s “funding policy and method;” and to amend or terminate, in whole or in
part, the Plan.  The Plan Administrator shall have sole and absolute discretion
for the administration of the Plan, which responsibility includes the sole and
absolute discretion to interpret the Plan and to determine eligibility for
benefits, including the amount of benefits.   The Trustee shall have sole and
absolute discretion of management of the assets held under the Trust, except
those assets, the management of which have been assigned to an Investment
Manager, who shall have sole and absolute discretion for the management of the
assets assigned to it, all as specifically provided herein.  Each Named
Fiduciary warrants that any directions given, information furnished, or action
taken by it shall be in accordance with the provisions herein, authorizing or
providing for such direction, information or action.  Furthermore, each Named
Fiduciary may rely upon any such direction, information or action of another
Named Fiduciary as being proper under the provisions of the Plan, and is not
required to inquire into the propriety of any such direction, information or
action.  It is intended under the provisions of the Plan that each Named
Fiduciary shall be responsible for the proper exercise of its own powers,
duties, responsibilities and obligations under the Plan.  No Named Fiduciary
shall guarantee the Trust Fund in any manner against investment loss or
depreciation in asset value.  Any person or group may serve in more than one
Fiduciary capacity.  In the furtherance of their responsibilities hereunder, the
Named Fiduciaries shall be empowered with the sole discretion to resolve
ambiguities, inconsistencies and omissions, which findings shall be binding,
final and conclusive.

 

15.02.     Nonalienability of Benefits. The rights of Participants and
Beneficiaries to receive any benefit payment under this Plan may not be
anticipated, assigned (either at law or in equity), alienated or subject to
attachment, garnishment, levy, execution or other legal or equitable process,
except to the extent otherwise provided for herein with respect to:

 

(a)           Qualified Domestic Relations Orders;

 

(b)           Loans to Participants;

 

(c)           An offset of a Participant’s benefits under this Plan that is the
result of a judgment of conviction for a crime involving the Plan, or under a
civil judgment (including a consent order or decree) for a violation of
fiduciary responsibilities under ERISA, or under a settlement agreement between
the Participant and the Secretary of Labor for a violation (or alleged
violation) of fiduciary responsibilities (including fiduciary duties) that
orders or requires the Participant to pay the Plan issued or entered into on or
after August 5, 1997. However, the judgment, order, decree, or settlement
agreement must specifically provide for the offset of all or part of the amount
ordered or required to be paid to the Plan against the Participant’s benefits
under this Plan. If Article VIII applies to the Plan, the Participant’s spouse,
if any, must consent in writing to the offset and the Spouse’s consent must be

 

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witnessed by a notary public or a Plan representative, unless the Plan has a
Qualified Election on file, or the judgment, order, decree, or settlement
requires the Participant’s spouse to pay the Plan, or under the judgment, order,
decree, or settlement the Participant’s spouse retains the right to their
benefits under Article VIII, determined pursuant to the requirements under Code
section 401(a)(13)(D).

 

This provision shall not preclude the enforcement of a federal tax levy made
pursuant to Code section 6331, or the collection by the United States on a
judgment resulting from an unpaid tax assessment.

 

15.03.     Rights to Trust Assets.  No Employee or Beneficiary shall have any
right to, or interest in, any assets of the Trust Fund except as provided under
this Plan, and then only to the extent of the benefits payable to such Employee
or Beneficiary out of the Trust Fund.

 

15.04.     No Diversion of Trust Fund.  No part of the Trust Fund shall be used
for, or diverted to, purposes other than for the exclusive benefit of the
Participants and their Beneficiaries.

 

15.05.     Name and Address Change.  Each Participant and each Beneficiary of a
deceased Participant shall at all times be responsible for notifying the Plan
Administrator of any change in his name or address. If any check payment of a
benefit hereunder (which was mailed to the last address of the payee as shown on
the records of the Plan Administrator) is returned unclaimed, further payments
shall be discontinued until the Plan Administrator directs otherwise.

 

15.06.     Plan Not an Employment Contract.  The adoption and continuance of
this Plan by the Employer (or Participating Employer) shall not be deemed to
constitute a contract of employment between the Employer (or Participating
Employer) and any Participant, Employee or other person; nor shall it be deemed
to be consideration for, inducement to, or a condition of employment of any
person.

 

15.07.     Controlling Law.  All legal questions pertaining to the Plan, all
constructions and all regulations shall be determined in accordance with the
laws of the State of the Employer unless otherwise preempted by ERISA or other
federal law.

 

15.08.     Severability.  If any provision of this Plan shall be held invalid or
illegal for any reason, such illegality or invalidity shall not affect the
remaining provisions, but each provision shall be fully severable, and the Plan
shall be construed and enforced as if such illegal or invalid provision had
never been inserted.

 

15.09.     Legal Action.  In the event any claim, suit, or proceeding is brought
regarding the Trust and/or Plan established hereunder to which the Trustee or
the Plan Administrator may be a party, and such claim, suit, or proceeding is
resolved in favor of the Trustee or Plan Administrator, they shall be entitled
to be reimbursed from the Trust Fund for any and all costs, attorney’s fees, and
other expenses pertaining thereto incurred by them for which they shall have
become liable.

 

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15.10.     Employer’s and Trustee’s Protective Clause.  Neither the Employer
(nor any Participating Employer) nor the Trustee, nor their successors, shall be
responsible for the validity of any Contract issued hereunder or for the failure
on the part of the insurer to make payments provided for by any such Contract,
or for the action or omission by any person which may delay payment or render a
Contract null and void or unenforceable in whole or in part.

 

15.11.     Insurer’s Protective Clause.  Any insurer who shall issue a Contract
hereunder shall not have any responsibility for the validity of this Plan or for
the tax or legal aspects of this Plan.  The insurer shall be protected and held
harmless in acting in accordance with any written direction of the Trustee, and
shall have no duty to see to the application of any funds paid to the Trustee,
nor be required to question any actions directed by the Trustee.  Regardless of
any provision of this Plan, the insurer shall not be required to take or permit
any action or allow any benefit or privilege contrary to the terms of any
Contract which it issues hereunder, or the rules of the insurer.

 

15.12.     Receipt and Release for Payments.  Any payment to any Participant,
his legal representative, Beneficiary, any alternate payee, or to the estate of
a Participant, Beneficiary or alternate payee,  or to any guardian or committee
appointed for such Participant, Beneficiary, alternate payee, or estate in
accordance with the provisions of the Plan, shall, to the extent thereof, be in
full satisfaction of all claims hereunder against the Trustee and the Employer
(or Participating Employer), either of whom may require such Participant, legal
representative, Beneficiary, alternate payee, guardian, or committee, or
administrator or executor or such estate, as a condition precedent to such
payment, to execute a receipt and release thereof in such form as shall be
determined by the Trustee or Employer.

 

15.13.     Action by the Employer.  Whenever the Employer under the terms of the
Plan is permitted or required to do or perform any act or matter or thing, it
shall be done and performed by a person duly authorized by its legally
constituted authority.

 

15.14.     Headings for Convenience.  Headings of Articles and Sections are
included solely for convenience or reference, and if there is any conflict
between such headings and the text of this Plan, the text shall control.

 

15.15.     Words Used.  Wherever appropriate, the masculine gender shall be
construed to include the feminine gender and neuter, and the feminine gender
shall be construed to include the masculine gender and neuter. Words used in the
singular shall be construed to include plurals, and the plural to include the
singular.

 

15.16.     Reference to Code or ERISA Sections.  Reference to the provision of
any particular section of the Code or ERISA shall be deemed reference to any
section of the Code or ERISA which may hereafter contain the same or similar
provision.

 

15.17.     Counterparts.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all
counterparts shall, together, constitute only one Plan document.

 

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APPENDIX A

TOP HEAVY PLAN

 

This Appendix shall apply for purposes of determining whether the Plan is a
Top-Heavy plan under section 416(g) of the Code for Plan Years commencing prior
to January 1, 2002, and whether the Plan satisfies the minimum benefits
requirements of section 416(c) of the Code for such years.

 

9.01.       Definitions.  If the Plan is or becomes Top-Heavy in any Plan Year
beginning prior to December 31, 2001, the provisions of this Appendix shall
supersede any conflicting provisions in the Plan or Adoption Agreement.

 

(a)           Determination Date means, with respect to any Plan Year, the last
day of the preceding Plan Year, or, in the case of the first Plan Year, the last
day of such Plan Year.

 

(b)           Permissive Aggregation Group means that group of plans in a
Required Aggregation Group, together with any plan or plans of the Employer not
required to be included in the Required Aggregation Group, provided the
resulting group, taken as a whole, would continue to satisfy the provisions of
Code sections 401(a)(4) and 410.

 

(c)           Present Value of Accrued Benefits means the present discounted
value of all Participants’ accrued benefits under all defined benefit plans
maintained by the Employer, discounted using the interest and mortality rates
specified in the Adoption Agreement, if applicable.

 

(d)           Required Aggregation Group means that group of plans composed of
each:

 

(1) plan of the Employer in which at least one Key Employee participates or
participated at any time during the Determination Period (regardless of whether
the plan is terminated), and

 

(2) any other qualified plan of the Employer which enables any plan in which a
Key Employee participates to meet the requirements of Code section 401(a)(4) or
410.

 

(e)           Top-Heavy Plan Year means a Plan Year commencing after December
31, 1983, in which the Plan is a Top-Heavy or a Super-Top-Heavy Plan.

 

(f)            Top-Heavy Ratio means the following:

 

(1) If the Employer maintains one or more defined contribution plans (including
any Simplified Employee Pension Plan) and the Employer has not maintained any
defined benefit plan which during the five-year (5) period ending on the
Determination Date has or has had accrued benefits, the Top-Heavy Ratio for this
Plan alone or for the Required Aggregation Group or the Permissive Aggregation
Group (whichever is applicable) is a fraction, the numerator of which is the sum
of the Total Balances of all Key Employees as of the Determination Date
(including any part of any Account balance distributed in the five-year (5)
period ending on the Determination Date, but excluding any Account balance due
to unrelated Rollovers and/or Plan-to-Plan Transfers), and the denominator of
which is the sum of all Total Balances (including any part of any Account

 

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balance distributed in the five-year (5) period ending on the Determination
Date, provided that with respect to death benefits, the amount used for
Top-Heavy testing is the amount determined as above immediately prior to a
Participant’s death, including the cash value of life insurance policies, if
any), both computed in accordance with Code section 416 and the regulations
promulgated thereunder. Both the numerator and denominator of the Top-Heavy
Ratio are adjusted to reflect any contribution which is due but unpaid as of the
Determination Date, but which is required to be taken into account on that date
under Code section 416 or the regulations promulgated thereunder.

 

(2) If the Employer maintains one or more defined contribution plans (including
any Simplified Employee Pension Plan) and the Employer maintains or has
maintained one or more defined benefit plans which during the five-year (5)
period ending on the Determination Date has or has had any accrued benefits, the
Top-Heavy Ratio for any Required Aggregation Group or Permissive Aggregation
Group (whichever is applicable) is a fraction, the numerator of which is the sum
of Total Account Balances under the aggregated defined contribution plan or
plans for all Key Employees determined in accordance with subsection (1) above
(including any part of any Account balance distributed in the five-year (5)
period ending on the Determination Date, but excluding any Account balance due
to unrelated Rollovers and/or Plan-to-Plan Transfers), and the Present Value of
Accrued Benefits under the aggregated defined benefit plan or plans for all Key
Employees as of the Determination Date, and the denominator of which is the sum
of the Total Balances under the aggregated defined contribution plans for all
Participants (including any part of any Account Balance distributed in the
five-year (5) period ending on the Determination Date, but excluding any Account
Balance due to unrelated Rollovers and/or Plan-to-Plan Transfers), and the
Present Value of Accrued Benefits under the defined benefit plan or plans for
all Participants as of the Determination Date, all determined in accordance with
Code section 416 and the regulations promulgated thereunder. The accrued
benefits under a defined benefit plan in both the numerator and denominator of
the Top-Heavy Ratio shall include any distribution of an accrued benefit made in
the five-year (5) period ending on the Determination Date.

 

(3) For purposes of subsections (1) and (2) above, the values used for
determining the Top-Heavy Ratio shall be determined as of the most recent
Valuation Date that falls within or ends with the 12-month period ending on the
Determination Date except as provided in Code section 416 and the regulations
promulgated thereunder for the first and second years of a defined benefit plan.
The Account balances and accrued benefits of a Participant (A) who is not a Key
Employee, but who was a Key Employee in a prior year, or (B) who has not been
credited with at least one (1) Hour of Service with any Employer maintaining
this Plan at any time during the five-year (5) period ending on the
Determination Date shall be disregarded. The calculation of the Top-Heavy Ratio,
and the extent to which distributions, rollovers, and transfers are taken into
account shall be made in accordance with Code section 416 and the regulations

 

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promulgated thereunder. Any amount attributable to accumulated deductible
Employee contributions (as defined in Code section 72(o)(5)(A)) shall be
disregarded for purposes of computing the Top-Heavy Ratio. When aggregating
plans, the value of Account balances and accrued benefits shall be calculated
with reference to the Determination Dates that fall within the same calendar
year.

 

The accrued benefit of a Participant other than a Key Employee shall be
determined under (A) the method, if any, that uniformly applies for accrual
purposes under all defined benefit plans maintained by the Employer, or (B) if
there is no such method, as if such benefit accrued not more rapidly than the
slowest accrual rate permitted under the fractional rule of Code section
411(b)(1)(C).

 

9.02.       Determination of Top-Heavy and Super Top-Heavy Status.

 

(a)           Top-Heavy Status.  This Plan shall be a Top-Heavy Plan for any
Plan Year commencing after December 31, 1983, if any of the following conditions
exists:

 

(1) this Plan is not part of any Required Aggregation Group or Permissive
Aggregation Group of plans and the Top-Heavy Ratio for this Plan exceeds 60%; or

 

(2) this Plan is a part of a Required Aggregation Group of Plans but not part of
a Permissive Aggregation Group, and the Top-Heavy Ratio for the Required
Aggregation Group of plans exceeds 60%; or

 

(3) this Plan is a part of a Required Aggregation Group and part of a Permissive
Aggregation Group of plans, and the Top-Heavy Ratio for the Permissive
Aggregation Group exceeds 60%.

 

(b)           Super Top-Heavy Status.  This Plan shall be a Super-Top-Heavy Plan
for any Plan Year commencing after December 31, 1983, if, after first
substituting the term 90% for the term 60% each time it appears in Section 9.02
(a), the Plan would meet the test for being a Top-Heavy Plan specified therein.

 

9.03.       Special Vesting Requirements.  For any Top-Heavy Plan Year, the
vesting schedule shall provide for 100% vesting after three (3) Years of Service
unless the vesting schedule in the Adoption Agreement provides for vesting on a
schedule which is at least as rapid as required for Top-Heavy plans under Code
section 416(b). The minimum vesting schedule applies to all benefits within the
meaning of Code section 411(a)(7) except those attributable to Participant
contributions (which shall be 100% vested at all times), including benefits
accrued before the effective date of Code section 416 and benefits accrued
before the Plan became a Top-Heavy Plan. Further, no reduction in vested
benefits may occur in the event the Plan’s status as a Top-Heavy Plan changes
for any Plan Year. However, this Section does not apply to the Employer Account
Balance of any Employee who does not have one Hour of Service after the Plan has
initially become a Top-Heavy Plan; such Employee’s vested percentage in his
Employer Account shall be determined without regard to this Section.

 

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9.04.       Special Minimum Allocation Requirements.

 

(a)           In general.  For any Top-Heavy Plan Year, except as otherwise
provided in subsection (b) below, for purposes of the minimum Top-Heavy
allocation, the Employer Contributions and Forfeitures allocated on behalf of
any Participant who is not a Key Employee shall not be less than the lesser of
three percent (3%) of such Participant’s 414(q) Compensation or (in the case
where the Employer has no defined benefit plan which designates this Plan to
satisfy Code section 401) the largest percentage of Employer Contributions and
Forfeitures, as a percentage of the lesser of a Key Employee’s 414(q)
Compensation, or Annual Limitation (adjusted pursuant to Code section
401(a)(17)), allocated on behalf of any Key Employee for such year.

 

The minimum allocation shall be determined without regard to any Social Security
contributions. The minimum allocation required (to the extent required to be
nonforfeitable under Section 9.03 and Code section 416(b)) shall not be
forfeited under Code section 411(a)(3)(B) or 411(a)(3)(D). This minimum
allocation shall be made even though, under other Plan provisions, a Participant
would not otherwise be entitled to receive an allocation, or would have received
a lesser allocation for the year because of:

 

(1) a Participant’s failure to complete a specified number of Hours of Service
(if any, as set forth in the Adoption Agreement); or

 

(2) a Participant’s failure to make or authorize any Salary Deferral
Contributions; or

 

(3) Compensation less than a stated amount.

 

A minimum Top-Heavy allocation, made on behalf of a Non-Key Employee shall be
allocated to a Non-Key Participant’s Salary Deferral Account for each Plan Year
in which the Plan is a Top-Heavy Plan. Salary Deferral Contributions, Matching
Contributions and Employer Contributions (and any other Employer Contributions)
to the Plan shall be combined to determine the largest contribution made or
required to be made for Key Employees.

 

The preceding provisions of this Section 9.04 shall not apply to this Plan if,
pursuant to the Adoption Agreement, this Plan enables a qualified defined
benefit plan in the Required Aggregation Group of the Employer to meet the
requirements of Code section 401(a)(4) or Code section 410.

 

(b)           Special Rules.

 

(5) In determining a Non-Key Employee’s required minimum allocation, such a
Non-Key Employee’s Salary Deferral Contributions for the Plan Year shall not be
taken into account.

 

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(2) The provisions in subsection (a) above shall not apply to any Participant
who was not employed by the Employer on the last day of the Plan Year (unless
otherwise specified in the Adoption Agreement).

 

(3) The provisions of subsection (a) shall not apply to any Participant to the
extent such Participant is covered under any other qualified plan or plans of
the Employer and the Employer has provided in the Adoption Agreement that the
minimum allocation or benefit requirement applicable to Top-Heavy Plans shall be
met in such other plan or plans.

 

9.05.       Special Multiple Plan Rules.

 

(a)           General rule.  For any Top-Heavy Plan Year, the term “1.0” shall
be substituted for the term “1.25” each time such term appears in the definition
of defined benefit plan fraction and the definition of the defined contribution
plan fraction as provided in Section 5.02.

 

(b)           Employees participating in only the defined benefit plan.
 Employees participating in only the defined benefit plan shall receive the
defined benefit minimum contribution required by Code section 416. Employees
participating in only this Plan shall receive the minimum allocation required
under Section 9.04.

 

(c)           Employees participating in both plans.  Employees participating in
both this Plan and a defined benefit plan maintained by the Employer are not
required to receive a minimum contribution under each plan. The Plan
Administrator shall set forth which of the applicable provisions below shall
override the other terms of the Plan, to the extent necessary to satisfy the
requirements of Code section 415 and/or avoid duplication of the required
aggregation of multiple plans.

 

(1) The Employer shall provide the minimum contribution solely under this Plan,
and the minimum contribution must equal five percent (5%) of each Non-Key
Employee’s 414(q) Compensation for each year with respect to which both plans
are treated as Top- Heavy; or

 

(2) The Employer shall provide the minimum benefit under the defined benefit
plan required by Code section 416 for each year with respect to which both plans
are treated as Top-Heavy; or

 

(3) The Employer shall provide the minimum benefit by a floor offset approach
(pursuant to Revenue Ruling 76-259, 1976-2 C. B. 111) under which the defined
benefit minimum is provided in the defined benefit plan and is offset by the
benefits provided under this Plan.

 

(4) The Plan Administrator shall prove, using a comparability analysis (pursuant
to Revenue Ruling 81-202, 1981-2 C. B. 93) that the plans are providing benefits
at least equal to the defined benefit minimum.

 

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9.06.       Change from Top-Heavy Plan to Non Top-Heavy Plan.  In the event that
the Plan becomes a Top-Heavy Plan, such change shall be treated as a Plan
amendment which affects the vesting schedule. In the event that the Plan,
thereafter, ceases to be a Top-Heavy Plan, the effect of again following the
regular vesting schedule(s) (as specified in the Adoption Agreement) shall be
treated as a Plan amendment which affects the vesting schedule, and shall be
governed by the provisions of Section 6.04.

 

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