Exhibit 10.16

 

COHERENT, INC.

 

2005 DEFERRED COMPENSATION PLAN

 

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PREAMBLE

 

This Coherent, Inc. 2005 Deferred Compensation Plan is adopted by Coherent, Inc.
for the benefit of certain of its Employees and members of its Board of
Directors, effective as of January 1, 2005 (the “Effective Date”).  The purpose
of the Plan is to provide supplemental retirement income and to permit eligible
Participants the option to defer receipt of Compensation, pursuant to the terms
of the Plan.  The Plan is intended to be an unfunded deferred compensation plan
maintained for the benefit of a select group of management or highly compensated
employees under sections 201(2), 301(a)(3) and 401(a)(1) of ERISA and is
intended to comply with Section 409A of the Internal Revenue Code.  Participants
shall have the status of unsecured creditors of Coherent, Inc. with respect to
the payment of Plan benefits.

 

From and after the Effective Date, this Plan replaces the Coherent, Inc. 1995
Deferred Compensation Plan, the Coherent, Inc. Supplementary Retirement Plan and
the Director Deferred Compensation Plan, which have been frozen to new deferrals
as of December 31, 2004 so as to qualify these prior plans for “grandfather”
treatment under Internal Revenue Code Section 409A.

 

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TABLE OF CONTENTS

 

 

Page

 

 

ARTICLE I Definitions

1

 

 

1.1

Definitions

1

 

 

ARTICLE II Participation

4

 

 

 

2.1

Date of Participation

4

2.2

Resumption of Participation Following Return to Service

4

2.3

Change in Employment Status

5

 

 

ARTICLE III

5

 

 

Contributions

5

 

 

3.1

Deferral Contributions

5

3.2

Accounts

6

3.3

Company Contributions

7

3.4

Cancellation of Elections Due to 401(k) Hardship Withdrawal or Unforeseeable
Emergency Distribution

7

 

 

ARTICLE IV Participants’ Accounts

8

 

 

4.1

Individual Accounts

8

4.2

Accounting for Distributions

8

4.3

Separate Accounts

8

 

 

ARTICLE V Investment of Contributions

8

 

 

5.1

Manner of Investment

8

5.2

Investment Decisions

9

 

 

ARTICLE VI Distributions

9

 

 

6.1

Certain Distributions to Participants and Beneficiaries

9

6.2

Subsequent Election to Delay or Change Form of Payment

10

6.3

Lump-Sum Distribution Timing

11

6.4

Installment Amounts

11

6.5

Unforeseeable Emergency Distributions

11

6.6

Scheduled In-Service Distribution

12

6.7

Death

12

6.8

Notice to Trustee

13

6.9

Time of Distribution

13

6.10

Limitation on Distributions to Covered Employees Prior to a Change of Control

13

6.11

Domestic Relations Order Distributions

13

6.12

Conflicts of Interest and Ethics Rules Distributions

13

 

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TABLE OF CONTENTS

 

 

Page

 

 

6.13

FICA and Related Income Tax Distribution

14

6.14

State, Local and Foreign Tax Distribution

14

6.15

Code Section 409A Distribution

14

6.16

Tax Withholding

14

6.17

Special 2008 Election

14

 

 

ARTICLE VII Change of Control

14

 

 

7.1

No New Participants Following Change of Control

14

7.2

Discretionary Termination and Accelerated Plan Distributions 30 Days Prior to or
Within 12 Months Following a Change in Control

14

 

 

ARTICLE VIII Termination Due to Corporate Dissolution or Pursuant to Bankruptcy
Court Approval

15

 

 

8.1

Corporate Dissolution

15

8.2

Bankruptcy Court Approval

15

 

 

ARTICLE IX Amendment and Termination

15

 

 

9.1

Amendment by Employer

15

9.2

Retroactive Amendments

15

9.3

Plan Deferral Termination

15

9.4

Distribution upon Certain Plan Terminations

15

 

 

ARTICLE X The Trust

16

 

 

10.1

Establishment of Trust

16

 

 

ARTICLE XI Miscellaneous

16

 

 

11.1

Limitation of Rights

16

11.2

Nontransferability; Domestic Relations Orders

16

11.3

Facility of Payment

16

11.4

Information between Employer and Trustee

16

11.5

Notices

16

11.6

Governing Law

17

11.7

No Guarantees Regarding Tax Treatment; Disclaimer

17

 

 

ARTICLE XII Plan Administration

17

 

 

12.1

Powers and responsibilities of the Administrator

17

12.2

Nondiscriminatory Exercise of Authority

18

12.3

Claims and Review Procedures

18

12.4

Exhaustion of Claims Procedure and Right to Bring Legal Claim

21

12.5

Plan’s Administrative Costs

21

 

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ARTICLE I

DEFINITIONS

 

1.1                                 DEFINITIONS.  WHEREVER USED HEREIN, THE
FOLLOWING TERMS HAVE THE MEANINGS SET FORTH BELOW, UNLESS A DIFFERENT MEANING IS
CLEARLY REQUIRED BY THE CONTEXT:

 

(A)                                  “ACCOUNT” MEANS AN ACCOUNT ESTABLISHED ON
THE BOOKS OF THE EMPLOYER FOR THE PURPOSE OF RECORDING AMOUNTS CREDITED ON
BEHALF OF A PARTICIPANT AND ANY EXPENSES, GAINS OR LOSSES INCLUDED THEREON.

 

(B)                                 “ADMINISTRATOR” MEANS THE EMPLOYER, OR THE
COMMITTEE, IF ONE HAS BEEN DESIGNATED BY SUCH EMPLOYER.

 

(C)                                  “BANKRUPTCY COURT APPROVAL” MEANS THE
APPROVAL OF A BANKRUPTCY COURT PURSUANT TO 11 U.S.C. § 503(B)(1)(A).

 

(D)                                 “BENEFICIARY” MEANS THE PERSON OR PERSONS
ENTITLED UNDER SECTION 6.7 TO RECEIVE BENEFITS UNDER THE PLAN UPON THE DEATH OF
A PARTICIPANT.

 

(E)                                  “CHANGE OF CONTROL EVENT” MEANS A CHANGE IN
OWNERSHIP OR EFFECTIVE CONTROL OF THE COMPANY OR IN THE OWNERSHIP OF A
SUBSTANTIAL PORTION OF THE COMPANY’S ASSETS, AS DEFINED UNDER CODE SECTION 409A.

 

(F)                                    “CODE” MEANS THE INTERNAL REVENUE CODE OF
1986, AS AMENDED FROM TIME TO TIME.

 

(G)                                 “CODE SECTION 409A” MEANS CODE SECTION 409A
AND THE PROPOSED OR FINAL (AS APPLICABLE) TREASURY REGULATIONS AND OTHER
OFFICIAL GUIDANCE PROMULGATED THEREUNDER.

 

(H)                                 “CODE SECTION 409A DISTRIBUTION” MEANS A
DISTRIBUTION PURSUANT TO SECTION 6.15 HEREOF.

 

(I)                                     “COMMITTEE” MEANS THE DEFERRED
COMPENSATION COMMITTEE COMPOSED OF THREE OR MORE INDIVIDUALS APPOINTED BY THE
COMPENSATION COMMITTEE OF THE BOARD OF DIRECTORS OF THE EMPLOYER, OR FOLLOWING A
CHANGE OF CONTROL, APPOINTED BY THE COMMITTEE, TO FUNCTION AS THE
ADMINISTRATOR.  ONCE APPOINTED, THE DEFERRED COMPENSATION COMMITTEE SHALL
INTERPRET AND ADMINISTER THIS PLAN AND TAKE SUCH OTHER ACTIONS AS MAY BE
SPECIFIED HEREIN.

 

(J)                                     “COMPANY” MEANS THE EMPLOYER AND ANY OF
ITS SUBSIDIARIES.

 

(K)                                  “COMPENSATION” MEANS (I) WITH RESPECT TO
ELIGIBLE EMPLOYEES, BASE SALARY, COMMISSIONS, VARIABLE COMPENSATION PLAN
BONUSES, AND, TO THE EXTENT THAT THEY QUALIFY AS SALES COMMISSIONS UNDER CODE
SECTION 409A, SALES COMMISSION PLAN BONUSES AND SALES INCENTIVE BONUSES,
INCLUDING AMOUNTS THAT ARE OTHERWISE EXCLUDABLE FROM THE GROSS INCOME OF THE
PARTICIPANT

 

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UNDER A SALARY REDUCTION AGREEMENT BY REASON OF THE APPLICATION OF SECTIONS 125
OR 402(A)(8) OF THE CODE, AND (II) WITH RESPECT TO OUTSIDE DIRECTORS, ALL CASH
RETAINERS AND CASH MEETING FEES, EXCLUDING EXPENSE REIMBURSEMENTS.  COMPENSATION
DOES NOT INCLUDE ANY SEVERANCE PAYMENTS OR BENEFITS.

 

(L)                                     “CORPORATE DISSOLUTION” MEANS A
DISSOLUTION OF THE COMPANY THAT IS TAXED UNDER CODE SECTION 331.

 

(M)                               “DEFERRAL CONTRIBUTIONS” MEANS, FOR EACH
PARTICIPANT, THE AMOUNT DEFERRED PURSUANT TO SECTION 3.1 HEREOF.

 

(N)                                 “DISABILITY” MEANS THE PARTICIPANT (I) IS
UNABLE TO ENGAGE IN ANY SUBSTANTIAL GAINFUL ACTIVITY BY REASON OF ANY MEDICALLY
DETERMINABLE PHYSICAL OR MENTAL IMPAIRMENT WHICH CAN BE EXPECTED TO RESULT IN
DEATH OR CAN BE EXPECTED TO LAST FOR A CONTINUOUS PERIOD OF NOT LESS THAN TWELVE
(12) MONTHS, OR (II) IS, BY REASON OF ANY MEDICALLY DETERMINABLE PHYSICAL OR
MENTAL IMPAIRMENT WHICH CAN BE EXPECTED TO LAST FOR A CONTINUOUS PERIOD OF NOT
LESS THAN TWELVE (12) MONTHS, RECEIVING INCOME REPLACEMENT BENEFITS FOR A PERIOD
OF NOT LESS THAN THREE (3) MONTHS UNDER AN ACCIDENT AND HEALTH PLAN COVERING
COMPANY EMPLOYEES.

 

(O)                                 “DOMESTIC RELATIONS ORDER” MEANS A COURT
ORDER THAT QUALIFIES AS A DOMESTIC RELATIONS ORDER UNDER CODE
SECTION 414(P)(1)(B).

 

(P)                                 “ELIGIBLE PARTICIPANT” MEANS (I) ANY
EMPLOYEE WITH AN ANNUAL BASE SALARY IN EXCESS OF THE AMOUNT SPECIFIED BY THE
COMMITTEE, (II) ANY OUTSIDE DIRECTOR, AND (III) ANY OTHER EMPLOYEES DESIGNATED
AS ELIGIBLE BY THE COMMITTEE.

 

(Q)                                 “EMPLOYEE” MEANS ANY EMPLOYEE OF THE
EMPLOYER.

 

(R)                                    “EMPLOYER” MEANS COHERENT, INC. AND ANY
SUCCESSORS AND ASSIGNS UNLESS OTHERWISE PROVIDED HEREIN.

 

(S)                                  “ENTRY DATE” MEANS (I) JANUARY 1 (WHICH IS
ALSO THE ENTRY DATE FOR EMPLOYEES WHO ARE PROMOTED OR GIVEN A BASE SALARY
INCREASE SO AS TO BECOME AN ELIGIBLE PARTICIPANT FOR THE FIRST TIME AND FOR
RE-HIRES WHO WERE PREVIOUSLY ELIGIBLE PARTICIPANTS), (II) FOR NEW EMPLOYEES WHO
ARE ELIGIBLE PARTICIPANTS (INCLUDING RE-HIRES WHO WERE NOT PREVIOUSLY ELIGIBLE
PARTICIPANTS), THE FIRST DAY OF THE NEXT PAYROLL PERIOD COMMENCING AFTER THE
NEXT PAYDATE FOLLOWING RECEIPT OF THEIR DEFERRAL ELECTION BY THE COMPANY;
PROVIDED, HOWEVER, THAT SUCH NEW EMPLOYEE’S DEFERRAL ELECTION MUST BE SUBMITTED
NO LATER THAN 30 DAYS FOLLOWING THEIR BECOMING NEWLY ELIGIBLE, OR (III) FOR
NON-EMPLOYEE DIRECTORS WHO ARE ELIGIBLE PARTICIPANTS FOR THE FIRST TIME, THE
FIRST DAY OF THE NEXT COMPANY FISCAL QUARTER FOLLOWING THEIR BECOMING A
NON-EMPLOYEE DIRECTOR; PROVIDED, HOWEVER, THAT SUCH NEW NON-EMPLOYEE DIRECTOR’S
DEFERRAL ELECTION MUST BE SUBMITTED NO LATER THAN 30 DAYS FOLLOWING THEIR
BECOMING A NEWLY ELIGIBLE NON-EMPLOYEE DIRECTOR.

 

(T)                                    “ERISA” MEANS THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS FROM TIME TO TIME AMENDED.

 

2

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(U)                                 “FICA AMOUNT” MEANS THE AGGREGATE FEDERAL
INSURANCE CONTRIBUTIONS ACT (FICA) TAX IMPOSED ON ANY ACCOUNT UNDER CODE
SECTIONS 3101, 3121(A) AND 3121(V)(2), AS APPLICABLE AND ANY CORRESPONDING TAX
WITHHOLDING PROVISIONS OF APPLICABLE STATE, LOCAL OR FOREIGN TAX LAWS AS A
RESULT OF THE PAYMENT OF THE FICA AMOUNT.

 

(V)                                 “401(K) PLAN” MEANS THE COHERENT, INC.
EMPLOYEE RETIREMENT AND INVESTMENT PLAN.

 

(W)                               “OUTSIDE DIRECTOR” MEANS A MEMBER OF THE BOARD
WHOM IS NOT AN EMPLOYEE.

 

(X)                                   “PARTICIPANT” MEANS ANY EMPLOYEE OR
OUTSIDE DIRECTOR WHO PARTICIPATES IN THE PLAN IN ACCORDANCE WITH ARTICLE 2
HEREOF.

 

(Y)                                 “PLAN” MEANS THIS COHERENT, INC. 2005
DEFERRED COMPENSATION PLAN.

 

(Z)                                   “PLAN YEAR” MEANS THE 12-CONSECUTIVE MONTH
PERIOD BEGINNING JANUARY 1 AND ENDING DECEMBER 31.

 

(AA)                            “PRIOR PLANS” MEANS THE COHERENT, INC. 1995
DEFERRED COMPENSATION PLAN, THE COHERENT, INC. SUPPLEMENTARY RETIREMENT PLAN AND
THE DIRECTOR DEFERRED COMPENSATION PLAN.

 

(BB)                          “RETIREMENT” MEANS A PARTICIPANT’S SEPARATION FROM
SERVICE AFTER ATTAINING 50 YEARS OF AGE.

 

(CC)                            “SALES COMMISSION”  MEANS “SALES COMMISSION
COMPENSATION” AS SUCH TERM IS DEFINED IN TREASURY REGULATION
§1.409A-2(A)(12)(I).

 

(DD)                          “SEPARATION FROM SERVICE” MEANS A SEPARATION FROM
SERVICE AS DEFINED UNDER CODE SECTION 409A.  FOR THIS PURPOSE, THE EMPLOYMENT
RELATIONSHIP WILL BE TREATED AS CONTINUING INTACT WHILE THE PARTICIPANT IS ON
MILITARY LEAVE, SICK LEAVE OR OTHER BONA FIDE LEAVE OF ABSENCE, EXCEPT THAT IF
THE PERIOD OF SUCH LEAVE EXCEEDS SIX (6) MONTHS AND THE PARTICIPANT DOES NOT
RETAIN A RIGHT TO RE-EMPLOYMENT UNDER AN APPLICABLE STATUTE OR BY CONTRACT, THEN
THE EMPLOYMENT RELATIONSHIP WILL BE DEEMED TO HAVE TERMINATED ON THE FIRST DAY
IMMEDIATELY FOLLOWING SUCH SIX-MONTH PERIOD.  A LEAVE OF ABSENCE CONSTITUTES A
BONA FIDE LEAVE OF ABSENCE ONLY IF THERE IS A REASONABLE EXPECTATION THAT THE
PARTICIPANT WILL RETURN TO PERFORM SERVICES FOR THE COMPANY.

 

(EE)                            “SPECIFIED EMPLOYEE” MEANS A PARTICIPANT WHO, AS
OF THE DATE OF HIS OR HER SEPARATION FROM SERVICE, IS A KEY EMPLOYEE OF THE
COMPANY.  FOR THIS PURPOSE, A PARTICIPANT IS A KEY EMPLOYEE IF HE OR SHE MEETS
THE REQUIREMENTS OF CODE SECTION 416(I)(1)(A)(I), (II) OR (III) (DISREGARDING
CODE SECTION 416(I)(5)).  AS OF 2008, THIS GENERALLY INCLUDES (I) THE TOP FIFTY
(50) COMPANY OFFICERS WITH COMPENSATION GREATER THAN $150,000 PER YEAR, (II) A
5% OWNER OF THE COMPANY, OR (III) A 1% OWNER OF THE COMPANY WITH COMPENSATION
GREATER THAN $150,000 PER YEAR.  FOR PURPOSES OF THE PRECEDING SENTENCE,
“COMPENSATION” MEANS COMPENSATION AS SUCH TERM IS DEFINED IN THE 401(K) PLAN FOR
CODE SECTION 415 PURPOSES.  THE DETERMINATION OF WHO IS A SPECIFIED EMPLOYEE
SHALL BE MADE ON DECEMBER 31 OF EACH YEAR AND SHALL INCLUDE ANY EMPLOYEE WHO
QUALIFIED

 

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AS A SPECIFIED EMPLOYEE AT ANY TIME DURING THE PRECEDING TWELVE-MONTH PERIOD. 
ONCE SO DETERMINED, THE LIST OF SPECIFIED EMPLOYEES SHALL BE INITIALLY EFFECTIVE
ON THE FOLLOWING APRIL 1 AND SHALL REMAIN EFFECTIVE FOR TWELVE MONTHS (I.E.,
THROUGH MARCH 31 OF THE FOLLOWING YEAR).

 

(FF)                                “SUBSIDIARY” MEANS A SUBSIDIARY OF THE
EMPLOYER, AS SUCH TERM IS DEFINED IN CODE SECTION 424(F).

 

(GG)                          “TRADING DAY” MEANS A DAY UPON WHICH THE MAJOR
U.S. NATIONAL STOCK EXCHANGES ARE OPEN FOR TRADING.

 

(HH)                          “TRUST” MEANS THE TRUST FUND ESTABLISHED PURSUANT
TO THE TERMS OF THE PLAN.

 

(II)                                  “TRUSTEE” MEANS THE CORPORATION OR
INDIVIDUALS NAMED IN THE AGREEMENT ESTABLISHING THE TRUST AND SUCH SUCCESSOR
AND/OR ADDITIONAL TRUSTEES AS MAY BE NAMED IN ACCORDANCE WITH THE TRUST
AGREEMENT.

 

(JJ)                                  “UNFORESEEABLE EMERGENCY” MEANS (A) A
SEVERE FINANCIAL HARDSHIP TO A PARTICIPANT RESULTING FROM AN ILLNESS OR ACCIDENT
OF THE PARTICIPANT OR HIS OR HER SPOUSE, BENEFICIARY OR DEPENDENT (AS DEFINED IN
SECTION 152 OF THE CODE, BUT WITHOUT REGARD TO SUBSECTIONS (B)(1), (B)(2) AND
(D)(1)(B) THEREOF), (B) LOSS OF THE PARTICIPANT’S PROPERTY DUE TO CASUALTY
(INCLUDING THE NEED TO REBUILD A HOME FOLLOWING DAMAGE TO A HOME NOT OTHERWISE
COVERED BY INSURANCE, FOR EXAMPLE, NOT AS A RESULT OF A NATURAL DISASTER), OR
(C) OTHER SIMILAR EXTRAORDINARY AND UNFORESEEABLE CIRCUMSTANCES ARISING AS A
RESULT OF EVENTS BEYOND THE CONTROL OF THE PARTICIPANT.

 

(KK)                            “YEAR OF SERVICE” MEANS A PERIOD OF 12
CONSECUTIVE MONTHS DURING WHICH THE PARTICIPANT IS EMPLOYED BY THE EMPLOYER OR
SERVES AS A BOARD MEMBER.  SERVICE COMMENCES ON THE DATE THE PARTICIPANT FIRST
COMMENCES SERVICE FOR THE EMPLOYER AND ENDS ON THE DATE THAT THE PARTICIPANT
QUITS, RETIRES, IS DISCHARGED, IS DETERMINED TO BE TOTALLY DISABLED OR DIES.

 

(LL)                                  “VALUATION DATE” MEANS (I) FOR
RE-ALLOCATIONS OF AMOUNTS PREVIOUSLY DEFERRED, THE DATE OF RE-ALLOCATION, OR, IF
THAT DATE IS NOT A TRADING DAY, THEN THE NEXT TRADING DAY, (II) FOR
DISTRIBUTIONS HEREUNDER, THE LAST DAY OF THE PRECEDING MONTH, OR, IF THAT DAY IS
NOT A TRADING DAY, THEN THE MOST RECENTLY CONCLUDED TRADING DAY,  AND (III) FOR
ALLOCATIONS OF DEFERRALS, THE NEXT TRADING DAY FOLLOWING THE PAYDAY TO WHICH THE
DEFERRAL RELATES.

 

ARTICLE II

PARTICIPATION

 

2.1                                 DATE OF PARTICIPATION.  EACH ELIGIBLE
PARTICIPANT SHALL BE BECOME A PARTICIPANT AS OF THE ENTRY DATE NEXT FOLLOWING
THEIR TIMELY FILING OF AN ELECTION TO DEFER COMPENSATION IN ACCORDANCE WITH
SECTION 3.1.

 

2.2                                 RESUMPTION OF PARTICIPATION FOLLOWING RETURN
TO SERVICE.  IF A PARTICIPANT CEASES TO BE AN EMPLOYEE OR OUTSIDE DIRECTOR AND
THEREAFTER RETURNS TO THE SERVICE OF THE EMPLOYER HE OR SHE

 

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WILL AGAIN BECOME A PARTICIPANT AS OF THE ENTRY DATE FOLLOWING THE DATE ON WHICH
HE OR SHE RE-COMMENCES SERVICE WITH THE EMPLOYER, PROVIDED HE OR SHE IS AN
ELIGIBLE PARTICIPANT AND HAS TIMELY FILED AN ELECTION TO DEFER COMPENSATION
PURSUANT TO SECTION 3.1.  ANY SCHEDULED PLAN PAYMENTS THE PARTICIPANT HAS BEEN
RECEIVING SHALL CONTINUE TO BE PAID AS PREVIOUSLY SCHEDULED.

 

2.3                                 CHANGE IN EMPLOYMENT STATUS.  IF ANY
EMPLOYEE PARTICIPANT CONTINUES IN THE EMPLOY OF THE EMPLOYER BUT CEASES TO BE AN
ELIGIBLE PARTICIPANT, THE INDIVIDUAL SHALL CONTINUE TO BE A PARTICIPANT UNTIL
THE ENTIRE AMOUNT OF HIS BENEFIT IS DISTRIBUTED; PROVIDED, HOWEVER, THE
INDIVIDUAL SHALL NOT BE ENTITLED TO MAKE DEFERRAL CONTRIBUTIONS DURING
SUBSEQUENT PLAN YEARS IN WHICH HE OR SHE IS NOT AN ELIGIBLE PARTICIPANT.  IN THE
EVENT AN EMPLOYEE PARTICIPANT CEASES TO BE AN ELIGIBLE PARTICIPANT, IF SUCH
INDIVIDUAL HAS NOT UNDERGONE A SEPARATION FROM SERVICE, HE OR SHE SHALL CONTINUE
TO MAKE DEFERRAL CONTRIBUTIONS UNDER THE PLAN THROUGH THE END OF THE PLAN YEAR
IN WHICH HE OR SHE CEASES TO BE AN ELIGIBLE PARTICIPANT.  THEREAFTER, SUCH
INDIVIDUAL SHALL NOT MAKE ANY FURTHER COMPENSATION DEFERRAL CONTRIBUTIONS TO THE
PLAN UNLESS OR UNTIL HE OR SHE AGAIN BECOMES AN ELIGIBLE PARTICIPANT.  IN THE
EVENT THAT THE INDIVIDUAL SUBSEQUENTLY AGAIN BECOMES AN ELIGIBLE PARTICIPANT,
THE INDIVIDUAL MAY RESUME FULL PARTICIPATION ON THE NEXT ENTRY DATE IN
ACCORDANCE WITH SECTION 3.1.

 

ARTICLE III

CONTRIBUTIONS

 

3.1                                 DEFERRAL CONTRIBUTIONS.

 

(A)                                  ANNUAL OPEN ENROLLMENT.  PRIOR TO THE
BEGINNING OF EACH PLAN YEAR, EACH ELIGIBLE PARTICIPANT (INCLUDING NEWLY ELIGIBLE
ELIGIBLE PARTICIPANTS WHO WERE FORMERLY ELIGIBLE PARTICIPANTS) MAY ELECT TO
EXECUTE A COMPENSATION REDUCTION AGREEMENT WITH THE EMPLOYER TO REDUCE HIS
COMPENSATION BY A SPECIFIED PERCENTAGE NOT EXCEEDING, (I) FOR ELIGIBLE
EMPLOYEES, 75% OF THEIR BASE SALARY AND 100% OF THEIR OTHER COMPENSATION, AND
(II) FOR OUTSIDE DIRECTORS, 100% OF THEIR COMPENSATION, EQUAL IN EITHER CASE TO
WHOLE NUMBER MULTIPLES OF ONE (1) PERCENT, AND IN A SCHEDULED AMOUNT OF NOT LESS
THAN $10,000.  SUCH AGREEMENT SHALL BECOME IRREVOCABLE AS OF THE LAST DAY OF THE
CALENDAR YEAR IN WHICH IT IS MADE AND SHALL BE EFFECTIVE, WITH RESPECT TO
ELIGIBLE EMPLOYEES, WITH THE FIRST PAYDAY IN THE FOLLOWING PLAN YEAR AND WITH
RESPECT TO OUTSIDE DIRECTORS, WITH THE FIRST DAY OF SERVICE IN THE FOLLOWING
PLAN YEAR.  EXCEPT WITH RESPECT TO PAYROLL PERIODS THAT CROSS-OVER FROM ONE
CALENDAR YEAR TO THE NEXT, THE ELECTION SHALL NOT BE EFFECTIVE WITH RESPECT TO
COMPENSATION RELATING TO SERVICES ALREADY PERFORMED.  WITH RESPECT TO
COMPENSATION THAT QUALIFIES AS A SALES COMMISSION, THE SERVICES RELATING TO SUCH
COMPENSATION SHALL BE DEEMED PERFORMED IN THE YEAR IN WHICH THE CUSTOMER PAYS
THE COMPANY.  AN ELECTION ONCE MADE WILL REMAIN IN EFFECT FOR PAYDAYS FALLING IN
THE DURATION OF THE PLAN YEAR.  AFTER THE BEGINNING OF A PLAN YEAR, A
PARTICIPANT WILL NOT BE PERMITTED TO CHANGE, TERMINATE OR REVOKE HIS OR HER
COMPENSATION DEFERRAL ELECTION FOR SUCH PLAN YEAR, EXCEPT TO THE LIMITED EXTENT
PROVIDED IN SECTION 3.4. AMOUNTS CREDITED TO A PARTICIPANT’S ACCOUNT PRIOR TO
THE EFFECTIVE DATE OF ANY NEW ELECTION WILL NOT BE AFFECTED AND WILL BE PAID IN
ACCORDANCE WITH THAT PRIOR ELECTION.

 

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(B)                                 NEWLY ELIGIBLE PARTICIPANTS.  THE SAME
RULES AS IN SECTION 3.1(A) ABOVE SHALL ALSO APPLY TO INDIVIDUALS WHO BECOME
ELIGIBLE PARTICIPANTS FOR THE FIRST TIME, EXCEPT (I) SUCH NEW ELIGIBLE
PARTICIPANTS SHALL HAVE NO MORE THAN THIRTY (30) DAYS FOLLOWING THEIR BECOMING
ELIGIBLE FOR THE FIRST TIME UNDER THE PLAN OR ANY OTHER NON-QUALIFIED DEFERRED
COMPENSATION PLANS OF THE EMPLOYER REQUIRED TO BE AGGREGATED WITH THE PLAN IN
WHICH TO ELECT TO HAVE THEIR COMPENSATION REDUCED, AND (II) THE AGREEMENT SHALL
BECOME EFFECTIVE, WITH RESPECT TO ELIGIBLE EMPLOYEES, WITH THE FIRST FULL
PAYROLL PERIOD COMMENCING FOLLOWING THE RECEIPT OF THEIR ELECTION BY THE COMPANY
AND WITH RESPECT TO OUTSIDE DIRECTORS, WITH THE FIRST DAY OF SERVICE FOLLOWING
THE RECEIPT OF THEIR ELECTION BY THE COMPANY.  NEWLY ELIGIBLE OUTSIDE DIRECTORS
MAY NOT, HOWEVER, DEFER QUARTERLY FEES PAYABLE ON ACCOUNT OF THE COMPANY’S
FISCAL QUARTER IN WHICH THE ELECTION IS MADE.

 

(C)                                  VARIABLE COMPENSATION PLAN, SALES
COMMISSION PLAN AND SALES INCENTIVE BONUSES PAYABLE IN A SUBSEQUENT YEAR.  IF A
VARIABLE COMPENSATION PLAN, SALES COMMISSION PLAN OR SALES INCENTIVE BONUS (SO
LONG AS SUCH SALES COMMISSION PLAN AND SALES INCENTIVE BONUS QUALIFIES AS SALES
COMMISSIONS UNDER SECTION 409A) IS EARNED IN ONE CALENDAR YEAR AND WOULD
NORMALLY BE PAID IN THE FIRST QUARTER OF THE ENSUING CALENDAR YEAR, IT SHALL BE
DEFERRED AND DISTRIBUTED BASED UPON THE ELECTION MADE BY THE ELIGIBLE
PARTICIPANT IN THE OPEN ENROLLMENT PERIOD IN THE YEAR PRIOR TO THE YEAR IN WHICH
IT WAS EARNED.  FOR NEWLY ELIGIBLE PARTICIPANTS, ANY SUCH VARIABLE COMPENSATION
PLAN, SALES COMMISSION PLAN OR SALES INCENTIVE BONUS SHALL BE DEFERRED AND
DISTRIBUTED BASED UPON THEIR INITIAL ELECTION MADE WITH RESPECT TO THE YEAR IN
WHICH IT WAS EARNED (OR THE YEAR IN WHICH IT WAS PAID TO THE COMPANY, WITH
RESPECT TO SALES COMMISSIONS); PROVIDED, HOWEVER, THAT SUCH ELECTION MAY APPLY
TO NO MORE THAN THE TOTAL AMOUNT OF SUCH COMPENSATION MULTIPLIED BY THE RATIO OF
THE NUMBER OF DAYS REMAINING IN THE APPLICABLE PERFORMANCE PERIOD AFTER SUCH
ELECTION BECOMES IRREVOCABLE OVER THE TOTAL NUMBER OF DAYS IN THE APPLICABLE
PERFORMANCE PERIOD.

 

EXAMPLE:  In the December, 2005 open enrollment period, an Eligible Participant
elects to defer 75% of her Sales Incentive Bonus for 2006.  The 2006 Sales
Incentive Bonus is normally paid in March, 2007.  The deferral and distribution
of her 2006 Sales Incentive Bonus otherwise payable in March 2007 are controlled
by her election made in the 2005 open enrollment period.

 

(D)                                 YEAR-END CROSS-OVER PAYROLL PERIODS. 
PAYDAYS RELATING TO PERIODS OF SERVICE THAT CROSS-OVER THE CALENDAR YEAR END
SHALL BE COVERED BY THE PARTICIPANT’S DEFERRAL ELECTION IN EFFECT FOR THE LATER
YEAR, CONSISTENTLY WITH THE DEFAULT RULES UNDER TREASURY REGULATION
§1.409A-2(A)(13).

 

(E)                                  LIMITATION ON DEFERRAL CHANGES.  THE DOLLAR
AMOUNT OF ANY PLAN DEFERRALS SHALL NOT BE REDUCED OR INCREASED DURING ANY PLAN
YEAR BY VIRTUE OF ANY PARTICIPANT ELECTION TO INCREASE, DECREASE OR TERMINATE
HIS OR HER RATE OF DEFERRAL IN ANY OTHER EMPLOYEE BENEFIT PLAN, INCLUDING THE
COMPANY’S EMPLOYEE STOCK PURCHASE PLAN; EXCEPT AS PERMITTED BY CODE SECTION 409A
WITH RESPECT TO CHANGES IN DEFERRAL ELECTIONS UNDER THE COMPANY’S
401(K) EMPLOYEE SAVINGS PLAN AND CODE SECTION 125 FLEXIBLE BENEFITS PLAN (OR AS
OTHERWISE PERMITTED UNDER CODE SECTION 409A).

 

3.2                                 ACCOUNTS.  THE EMPLOYER SHALL CREDIT AN
AMOUNT TO THE ACCOUNT MAINTAINED ON BEHALF OF THE PARTICIPANT CORRESPONDING TO
THE AMOUNT OF SAID REDUCTION.  UNDER NO CIRCUMSTANCES MAY AN ELECTION TO DEFER
COMPENSATION BE ADOPTED RETROACTIVELY.

 

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3.3                                 COMPANY CONTRIBUTIONS.

 

(A)                                  DISCRETIONARY CONTRIBUTIONS.  THE COMPANY
MAY, IN ITS SOLE DISCRETION, MAKE A CONTRIBUTION TO A PARTICIPANT’S ACCOUNT,
SUBJECT TO SUCH VESTING AND DISTRIBUTION CONDITIONS AND LIMITATIONS AS THE
COMPANY, IN ITS SOLE DISCRETION, SHALL IMPOSE.  TO THE EXTENT SUCH COMPANY
CONTRIBUTIONS DO NOT VEST, CORRESPONDING DEBITS WILL BE MADE TO A PARTICIPANT’S
ACCOUNT, INCLUDING ANY EARNINGS ON SUCH FORFEITED AMOUNTS.

 

(B)                                 ANNUAL CONTRIBUTION.  UNTIL SUCH TIME AS THE
COMPANY DETERMINES OTHERWISE, THE COMPANY SHALL MAKE AN ANNUAL CONTRIBUTION ON
BEHALF OF ANY EMPLOYEE WITH A PLAN ACCOUNT WHO ALSO MAKES A DEFERRAL FOR A GIVEN
YEAR INTO THE EMPLOYER’S 401(K) PLAN.  THE AMOUNT OF THE ANNUAL CONTRIBUTION
SHALL BE EQUAL TO 6% OF THE PARTICIPANT’S COMPENSATION, AS SUCH TERM IS DEFINED
IN SECTION 2.12 OF THE EMPLOYER’S 401(K) PLAN, WITHOUT REGARD TO
SECTION 2.12(B) THEREOF (“401(K) COMPENSATION”) FOR AN APPLICABLE YEAR, MINUS
THE MAXIMUM AMOUNT PERMITTED TO BE CONTRIBUTED TO A PARTICIPANT’S ACCOUNT IN THE
EMPLOYER’S 401(K) PLAN AS AN EMPLOYER MATCHING CONTRIBUTION, AS LIMITED BY
VIRTUE OF CODE SECTION 401(A)(17), FOR SUCH YEAR.  THE ANNUAL CONTRIBUTION SHALL
BE CREDITED TO THE PARTICIPANT’S ACCOUNT IN THE CALENDAR YEAR FOLLOWING THE YEAR
IN WHICH THE 401(K) PLAN DEFERRALS WERE MADE.

 

EXAMPLE:  In 2006, Employee Favre (who also participates in the Plan) defers
part of his compensation into the Employer’s 401(k) Plan.  Employee Favre’s 2006
401(k) Compensation is $300,000.  Because of the Code section 401(a)(17) limit,
the Employer can only make a maximum matching contribution of $13,200 into
Employee Favre’s 401(k) Plan account in 2006 (the 2006 Code section 401(a)(17)
limit of $220,000 x 6%).  Accordingly, Employee Favre receives a
non-discretionary credit in the Plan equal to $4,800 [(6% x $300,000) - $13,200]
in 2007.  Employee Favre will receive this credit even if the amount of the
employer match into his 401(k) Plan account for 2006 is less than $13,200 by
virtue of his deferring less than $13,200 into the 401(k) Plan in 2006.

 

3.4                                 CANCELLATION OF ELECTIONS DUE TO
401(K) HARDSHIP WITHDRAWAL OR UNFORESEEABLE EMERGENCY DISTRIBUTION.

 

(A)                                  401(K) HARDSHIP WITHDRAWAL.  A
PARTICIPANT’S DEFERRAL ELECTION SHALL BE AUTOMATICALLY CANCELLED IN THE EVENT
THE PARTICIPANT OBTAINS A HARDSHIP DISTRIBUTION FROM THE EMPLOYER’S 401(K) PLAN
PURSUANT TO TREASURY REGULATION §1.401(K)-1(D)(3).  THE PARTICIPANT, IF STILL AN
ELIGIBLE PARTICIPANT, MAY RE-ENROLL IN THE PLAN IN THE NEXT OPEN ENROLLMENT
PERIOD.

 

(B)                                 UNFORESEEABLE EMERGENCY DISTRIBUTION.  A
PARTICIPANT’S DEFERRAL ELECTION SHALL BE AUTOMATICALLY CANCELLED IN THE EVENT
THE PARTICIPANT OBTAINS AN UNFORESEEABLE EMERGENCY DISTRIBUTION FROM THE PLAN
PURSUANT TO SECTION 6.5 HEREOF.  THE PARTICIPANT, IF STILL AN ELIGIBLE
PARTICIPANT, MAY RE-ENROLL IN THE PLAN IN THE NEXT OPEN ENROLLMENT PERIOD.

 

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(C)                                  SPECIAL 2005 ELECTIONS.

 

(I)             IN ACCORDANCE WITH INTERNAL REVENUE SERVICE NOTICE 2005-1,
Q&A-21, ELIGIBLE PARTICIPANTS MAY MAKE A DEFERRAL ELECTION WITH RESPECT TO 2005
COMPENSATION THAT HAS NOT BEEN PAID OR BECOME PAYABLE AT THE TIME OF ELECTION,
AND SUPERSEDING THEIR PRIOR ELECTION, IF ANY, WITH RESPECT TO SUCH COMPENSATION,
ON OR BEFORE MARCH 15, 2005, OR SUCH EARLIER TIME AS IS DETERMINED BY THE
ADMINISTRATOR (OR ITS DESIGNEE) IN ITS SOLE DISCRETION.

 

(II)          IN ACCORDANCE WITH INTERNAL REVENUE SERVICE NOTICE 2005-1 AND THE
PROPOSED TREASURY REGULATIONS PROMULGATED UNDER CODE SECTION 409A, AND
NOTWITHSTANDING ANY CONTRARY PROVISION OF THE PLAN, A PARTICIPANT MAY ELECT TO
RESCIND OR REDUCE HIS OR HER 2005 COMPENSATION DEFERRAL ELECTION MADE UNDER
SECTION 3.1 BY FILING A FORM SPECIFIED BY THE ADMINISTRATOR (OR ITS DESIGNEE)
WITH THE ADMINISTRATOR (OR ITS DESIGNEE) NO LATER THAN DECEMBER 31, 2005, OR
SUCH EARLIER TIME AS IS DETERMINED BY THE ADMINISTRATOR (OR ITS DESIGNEE), IN
ITS SOLE DISCRETION.  THE AMOUNT SUBJECT TO SUCH ELECTION SHALL BE DISTRIBUTED
TO THE PARTICIPANT IN A SINGLE LUMP SUM PAYMENT OF CASH (OR ITS EQUIVALENT) IN
CALENDAR YEAR 2005 OR, IF LATER, THE PARTICIPANT’S TAXABLE YEAR IN WHICH THE
AMOUNT BECOMES EARNED AND VESTED.

 

ARTICLE IV

PARTICIPANTS’ ACCOUNTS

 

4.1                                 INDIVIDUAL ACCOUNTS.  THE ADMINISTRATOR WILL
ESTABLISH AND MAINTAIN AN ACCOUNT FOR EACH PARTICIPANT WHICH WILL REFLECT
DEFERRAL CONTRIBUTIONS CREDITED TO THE ACCOUNT ON BEHALF OF THE PARTICIPANT WITH
EARNINGS, EXPENSES, GAINS AND LOSSES CREDITED THERETO, ATTRIBUTABLE TO THE
INVESTMENTS MADE WITH THE AMOUNTS IN THE PARTICIPANT’S ACCOUNT.  PARTICIPANTS
WILL BE FURNISHED STATEMENTS OF THEIR ACCOUNT VALUES AT LEAST ONCE EACH PLAN
YEAR.

 

4.2                                 ACCOUNTING FOR DISTRIBUTIONS.  AS OF ANY
DATE OF A DISTRIBUTION TO A PARTICIPANT OR A BENEFICIARY HEREUNDER, THE
DISTRIBUTION TO THE PARTICIPANT OR TO THE PARTICIPANT’S BENEFICIARY(IES) SHALL
BE CHARGED TO THE PARTICIPANT’S ACCOUNT.

 

4.3                                 SEPARATE ACCOUNTS.  A SEPARATE ACCOUNT UNDER
THE PLAN SHALL ESTABLISHED AND MAINTAINED TO REFLECT THE ACCOUNT FOR EACH
PARTICIPANT WITH SUBACCOUNTS TO SHOW SEPARATELY THE EARNINGS, EXPENSES, GAINS
AND LOSSES CREDITED OR DEBITED TO THAT ACCOUNT.

 

ARTICLE V

INVESTMENT OF CONTRIBUTIONS

 

5.1                                 MANNER OF INVESTMENT.  ALL AMOUNTS CREDITED
TO THE ACCOUNTS OF PARTICIPANTS SHALL BE TREATED AS THOUGH INVESTED ONLY IN
ELIGIBLE INVESTMENTS SELECTED BY THE EMPLOYER.

 

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5.2                                 INVESTMENT DECISIONS.

 

(A)                                  ACCOUNTS SHALL BE TREATED AS INVESTED AS
DIRECTED BY THE PARTICIPANT AMONG THE ELIGIBLE INVESTMENT ALTERNATIVES SELECTED
BY THE EMPLOYER.  PARTICIPANTS MAY CHANGE THEIR INVESTMENT ALLOCATIONS AS
SPECIFIED BY THE COMMITTEE.

 

(B)                                 ALL DIVIDENDS, INTEREST, GAINS AND
DISTRIBUTIONS OF ANY NATURE EARNED IN RESPECT OF AN INVESTMENT ALTERNATIVE IN
WHICH THE ACCOUNT IS TREATED AS INVESTING SHALL BE CREDITED TO THE ACCOUNT IN AN
AMOUNT EQUAL TO THE NET INCREASE OR DECREASE IN THE NET ASSET VALUE OF EACH
INVESTMENT OPTION SINCE THE PRECEDING VALUATION DATE.

 

ARTICLE VI

DISTRIBUTIONS

 

6.1                                 CERTAIN DISTRIBUTIONS TO PARTICIPANTS AND
BENEFICIARIES.

 

(A)                                  EARLIEST DISTRIBUTIONS

 

(i)             Regular Participants.  Except as permitted by the Plan and Code
Section 409A in connection with a Change of Control Event, a Corporate
Dissolution, pursuant to a Bankruptcy Court Approval, a conflicts of interest or
ethics rule distribution under Section 6.12, a FICA and related income tax
distribution under Section 6.13, a state, local or foreign tax distribution
under Section 6.4, or a Code Section 409A Distribution, in no event may the
account of a Participant who is not a Specified Employee be distributed earlier
than (i) the Participant’s Separation From Service, (ii) the Participant’s
Disability, (iii) the Participant’s death, (iv) a specified time under
Section 6.6 hereunder, (v) a Change in Control, (vi) the occurrence of an
Unforeseeable Emergency, or (vii) as required to satisfy a Domestic Relations
Order.

 

(ii)          Specified Employee Participants.  Except as permitted by the Plan
and Code Section 409A in connection with a Change of Control Event, a Corporate
Dissolution, pursuant to a Bankruptcy Court Approval, a conflicts of interest or
ethics rules distribution under Section 6.12, a FICA and related income tax
distribution under Section 6.13, a state, local or foreign tax distribution
under Section 6.4, or a Code Section 409A Distribution, in no event may a
Specified Employee’s account be distributed earlier than (i) six (6) months
following the Specified Employee’s Separation From Service (or if earlier, the
Specified Employee’s death), (ii) the Specified Employee’s Disability, (iii) the
Specified Employee’s death, (iv) a specified time under Section 6.6 hereunder,
(v) a Change in Control, (vi) the occurrence of an Unforeseeable Emergency, or
(vii) as required to satisfy a Domestic Relations Order.  In the event a
Specified Employee’s Plan distributions are delayed due to the six-month delay
requirement, the amounts otherwise payable to the Specified Employee during such
period of delay shall be paid on a date that is at least six months and one day
following Separation From Service, but no later than the end of the calendar
year in which such six month and one day period ends (or, if earlier, within 60
days following the death of the Specified Employee).  The Participant’s other
scheduled distributions, if any, shall not be affected by the period of delay.

 

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(B)                                 LUMP-SUM OR INSTALLMENT PAYMENT INITIAL
ELECTIONS UPON RETIREMENT OR DISABILITY.  AT THE SAME TIME THEIR INITIAL
ELECTIONS FOR ANY PLAN YEAR ARE MADE, PARTICIPANTS SHALL ELECT TO HAVE THEIR
COMPENSATION DEFERRALS FOR THAT PLAN YEAR PAID OUT, EITHER FOLLOWING THEIR
RETIREMENT OR THEIR DISABILITY, IN ONE OF THE FOLLOWING FORMS OF PAYMENT:

 

(I)                     LUMP SUM CASH PAYMENT; OR

 

(II)                  TWO TO FIFTEEN SUBSTANTIALLY EQUAL ANNUAL INSTALLMENTS.

 

In no event shall any Plan payments be made more than sixteen (16) years
following a Participant’s Separation From Service.  Any payment scheduled to be
made more than sixteen (16) years following a Participant’s Separation From
Service shall be paid with the last scheduled payment with the sixteen (16) year
period.

 

(C)                                  OTHER PLAN PAYMENTS.  ALL PLAN PAYMENTS NOT
SPECIFIED IN SECTION 6.1(B), EXCEPT FOR CERTAIN SCHEDULED IN-SERVICE WITHDRAWALS
AS SPECIFIED IN SECTION 6.6, SHALL BE MADE IN THE FORM OF A LUMP-SUM PAYMENT.

 

(D)                                 INSTALLMENT PAYMENTS TREATED AS SINGLE
PAYMENTS.  ALL INSTALLMENT PAYMENTS UNDER THE PLAN ARE CONSIDERED A SINGLE
PAYMENT FOR PURPOSES OF COMPLYING WITH CODE SECTION 409A.

 

6.2                                 SUBSEQUENT ELECTION TO DELAY OR CHANGE
FORM OF PAYMENT.

 

(I)             A PARTICIPANT’S INITIAL ELECTION TO RECEIVE A RETIREMENT,
DISABILITY OR IN-SERVICE DISTRIBUTION MAY BE DELAYED OR THE FORM OF PAYMENT
CHANGED BY FILING AN ELECTION, IN THE FORM REQUIRED BY THE ADMINISTRATOR, AT
LEAST ONE YEAR IN ADVANCE OF THE DATE UPON WHICH ANY DISTRIBUTION WOULD
OTHERWISE HAVE BEEN MADE PURSUANT TO THE PRIOR ELECTION.  SUCH ELECTION SHALL
NOT BE EFFECTIVE FOR A PERIOD OF ONE (1) YEAR, AND MUST DELAY THE INITIAL
PAYMENT BY A PERIOD OF AT LEAST FIVE (5) YEARS, BUT MAY NOT RESULT IN THE
INITIAL PAYMENT OCCURRING MORE THAN THEN TEN (10) YEARS FOLLOWING RETIREMENT OR
DISABILITY.  IN THE ABSENCE OF SUCH TIMELY FILED ELECTION, THE VALUE OF SUCH
PARTICIPANT’S ACCOUNT SHALL BE DISTRIBUTED IN ACCORDANCE WITH THEIR PREVIOUSLY
TIMELY FILED ACCOUNT ELECTION.

 

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(II)          BECAUSE PLAN INSTALLMENT PAYMENTS ARE CONSIDERED A SINGLE PAYMENT
FOR PURPOSES OF CODE SECTION 409A, A SUBSEQUENT ELECTION MAY ACCELERATE THE
METHOD OF DISTRIBUTION.  FOR EXAMPLE, IF A PARTICIPANT INITIALLY ELECTED TO
RECEIVE RETIREMENT OR DISABILITY PAYMENTS IN FIVE ANNUAL INSTALLMENTS FOLLOWING
HER SEPARATION FROM SERVICE, SHE COULD MAKE A TIMELY ELECTION TO INSTEAD TAKE A
LUMP-SUM DISTRIBUTION FIVE YEARS FOLLOWING HER SEPARATION FROM SERVICE. 
MOREOVER, A SUBSEQUENT ELECTION MAY CHANGE A LUMP-SUM DISTRIBUTION TO AN
INSTALLMENT ELECTION, SO LONG AS, IN EITHER CASE, THE INITIAL PAYMENT IS DELAYED
FOR A PERIOD OF AT LEAST FIVE (5) YEARS, THE ELECTION IS NOT EFFECTIVE FOR ONE
(1) YEAR AND IS MADE AT LEAST ONE (1) YEAR IN ADVANCE OF THE DATE UPON WHICH THE
FIRST DISTRIBUTION WOULD HAVE OTHERWISE BEEN MADE.

 

(III)       BECAUSE INSTALLMENT PAYMENTS ARE TREATED AS A SINGLE PAYMENT, ANY
SUBSEQUENT ELECTION MUST APPLY TO ALL OF THE INSTALLMENT PAYMENTS.  FOR EXAMPLE,
IF A PARTICIPANT INITIALLY ELECTED TO RECEIVE RETIREMENT OR DISABILITY PAYMENTS
IN FIVE ANNUAL INSTALLMENTS FOLLOWING HER SEPARATION FROM SERVICE, THE
PARTICIPANT MAY NOT ELECT TO DEFER THE 1ST, 2D, 3RD AND 5TH INSTALLMENTS ONLY,
BUT MUST ALSO DEFER THE 4TH INSTALLMENT.

 

6.3                                 LUMP-SUM DISTRIBUTION TIMING.  EXCEPT AS
ELECTED OTHERWISE FOR PLAN YEARS PRIOR TO THE 2009 PLAN YEAR, FOR PARTICIPANTS
RECEIVING A LUMP-SUM DISTRIBUTION (OTHER THAN A SMALL ACCOUNT LUMP-SUM
DISTRIBUTION UNDER SECTION 6.2 HEREOF, WHICH SHALL BE PAID IN ACCORDANCE WITH
THAT SUBSECTION), THE VALUE OF THEIR ACCOUNT (OR PORTION THEREOF SPECIFIED IN
THE PARTICIPANT’S ELECTION) SHALL BE PAID IN A LUMP-SUM CASH PAYMENT IN THE
FIRST FEBRUARY FOLLOWING THEIR SEPARATION FROM SERVICE, OR, FOR SPECIFIED
EMPLOYEES (OR THEIR ESTATES OR BENEFICIARIES), IF LATER, AT LEAST SIX MONTHS AND
ONE DAY AFTER THE DATE UPON WHICH THEY INCUR A SEPARATION FROM SERVICE, BUT NO
LATER THAN THE END OF THE CALENDAR YEAR IN WHICH SUCH SIX MONTH AND ONE DAY
PERIOD ENDS OR, IF EARLIER, UPON THEIR DEATH.

 

6.4                                 INSTALLMENT AMOUNTS.  FOR PURPOSES OF THIS
SECTION 6, INSTALLMENT PAYMENTS SHALL BE DETERMINED BY DIVIDING THE VALUE OF THE
PARTICIPANT’S ACCOUNT AT THE TIME OF SUCH INSTALLMENT BY THE NUMBER OF PAYMENTS
REMAINING.  EXCEPT AS ELECTED OTHERWISE FOR PLAN YEARS PRIOR TO THE 2009 PLAN
YEAR, INSTALLMENT PAYMENTS OTHER THAN IN-SERVICE DISTRIBUTIONS SHALL COMMENCE IN
THE NEXT FEBRUARY FOLLOWING THE TRIGGERING DISTRIBUTION EVENT, OR, FOR SPECIFIED
EMPLOYEES UNDERGOING A SEPARATION FROM SERVICE TRIGGERING EVENT, AS SOON AS IS
PRACTICABLE AT LEAST SIX MONTHS AND ONE DAY AFTER THE DATE UPON WHICH THEY INCUR
A SEPARATION FROM SERVICE, BUT NO LATER THAN THE END OF THE CALENDAR YEAR IN
WHICH SUCH SIX MONTH AND ONE DAY PERIOD ENDS.  HOWEVER, IN NO EVENT MAY
INSTALLMENT PAYMENTS BE MADE OVER A PERIOD EXCEEDING FOURTEEN YEARS FOLLOWING
THE FIRST INSTALLMENT, EVEN IF THE PAYMENTS ARE POSTPONED PURSUANT TO AN
ELECTION MADE UNDER SECTION 6.2 HEREOF.  IN-SERVICE DISTRIBUTIONS WILL COMMENCE
IN THE FEBRUARY OF THE SPECIFIED YEAR.

 

6.5                                 UNFORESEEABLE EMERGENCY DISTRIBUTIONS.  WITH
THE CONSENT OF THE ADMINISTRATOR, A PARTICIPANT MAY WITHDRAW UP TO ONE HUNDRED
PERCENT (100%) OF HIS OR HER ACCOUNT AS MAY BE REQUIRED TO MEET A SUDDEN
UNFORESEEABLE EMERGENCY OF THE PARTICIPANT.  SUCH DISTRIBUTION MAY ONLY BE MADE
IF THE AMOUNTS DISTRIBUTED WITH RESPECT TO AN UNFORESEEABLE EMERGENCY MAY NOT
EXCEED THE AMOUNTS NECESSARY TO SATISFY SUCH EMERGENCY PLUS AMOUNTS NECESSARY TO
PAY TAXES REASONABLY ANTICIPATED AS A RESULT OF THE DISTRIBUTION, AFTER TAKING
INTO ACCOUNT THE EXTENT TO WHICH SUCH HARDSHIP

 

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IS OR MAY BE RELIEVED THROUGH REIMBURSEMENT OR COMPENSATION BY INSURANCE OR
OTHERWISE OR BY LIQUIDATION OF THE PARTICIPANT’S ASSETS (TO THE EXTENT THE
LIQUIDATION OF SUCH ASSETS WOULD NOT ITSELF CAUSE SEVERE FINANCIAL HARDSHIP).

 

6.6                                 SCHEDULED IN-SERVICE DISTRIBUTION.  A
PARTICIPANT MAY ELECT, AS PROVIDED IN HIS OR HER PARTICIPANT DEFERRAL ELECTION,
TO RECEIVE ONE OR MORE SCHEDULED IN-SERVICE (I.E., COMMENCING WHILE EMPLOYED BY
THE COMPANY, OR, FOR OUTSIDE DIRECTOR PARTICIPANTS, WHILE SERVING AS A BOARD
MEMBER) DISTRIBUTIONS RELATING TO THE PLAN YEAR TO WHICH THE DEFERRAL ELECTION
RELATES.  SUCH IN-SERVICE DISTRIBUTIONS MAY ONLY BE SCHEDULED FOR YEARS AT LEAST
TWO FULL CALENDAR YEARS FOLLOWING THE END OF THE CALENDAR YEAR TO WHICH THE
DEFERRALS RELATE. PARTICIPANTS MAY ELECT TO RECEIVE IN-SERVICE DISTRIBUTIONS OF
DEFERRALS IN ANNUAL INSTALLMENTS OF UP TO FIVE YEARS.

 

EXAMPLE:  In the December, 2005 open enrollment period, an Eligible Participant
elects to receive an in-service distribution of 50% of her 2006 plan deferrals,
plus earnings and losses thereon, in 2009.  This includes a variable
compensation plan bonus paid in 2007 but earned in 2006.  Because the scheduled
in-service distribution is at least two full calendar years following the end of
2006 (the end of the year to which the deferrals relate), the election is
permissible.

 

Each scheduled in-service distribution may only be postponed in accordance with
Section 6.2 hereof.  In the event a Participant incurs a Separation From Service
prior to receiving the first scheduled payment, then the scheduled in-service
distribution election shall be without further force and effect and the
applicable Separation From Service distribution provisions of the Plan and the
Participant’s deferral election shall control.  Similarly, in the event a
Participant incurs a Separation From Service after receiving the first scheduled
in-service distribution payment, and if the Separation From Service is not
pursuant to Retirement, Disability or death, then any scheduled future
installments of the in-service distribution election shall be without further
force and effect and the applicable Separation From Service distribution
provisions of the Plan and the Participant’s deferral election shall control. 
If, however, a Participant incurs a Separation From Service due to his or her
Retirement, Disability or death after receiving their first scheduled in-service
distribution payment, then the scheduled in-service distributions will be made
according to their schedule and will take precedence over the Participant’s
other deferral elections; provided, however, that the first scheduled payment
following the Separation From Service for a Specified Employee shall be paid on
a date that is at least six months and one day following Separation From
Service, but no later than the end of the calendar year in which such six month
and one day period ends (or, if earlier, upon the death of the Specified
Employee).

 

6.7                                 DEATH.  EXCEPT WITH RESPECT TO CERTAIN
IN-SERVICE DISTRIBUTIONS AS PROVIDED BELOW, IF A PARTICIPANT DIES, HIS OR HER
DESIGNATED BENEFICIARY OR BENEFICIARIES WILL RECEIVE THE BALANCE OF HIS OR HER
ACCOUNT IN A LUMP-SUM.  MOREOVER, IF SUCH DEATH OCCURS PRIOR TO A SEPARATION
FROM SERVICE, THE ACCOUNT SHALL VEST 100% AS TO ANY PREVIOUSLY UNVESTED ACCOUNT
BALANCE.  DISTRIBUTION TO THE BENEFICIARY OR BENEFICIARIES WILL BE MADE ON THE
DATE THAT IS 3 MONTHS AND ONE DAY FOLLOWING THE PARTICIPANT’S DEATH.

 

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A Participant may designate a Beneficiary or Beneficiaries, or change any prior
designation of Beneficiary or Beneficiaries by giving notice to the
Administrator on a form designated by the Administrator (spousal consent to such
change may be required on the form designated by the Administrator).  If more
than one person is designated as the Beneficiary, their respective interests
shall be as indicated on the designation form.

 

If upon the death of the Participant there is, in the opinion of the
Administrator, no designated Beneficiary for part or all of the Participant’s
Account, the amount as to which there is no designated Beneficiary will be paid
to his or her surviving spouse or, if none, to his or her estate (such spouse or
estate shall be deemed to be the Beneficiary for purposes of the Plan).

 

6.8                                 NOTICE TO TRUSTEE.  THE ADMINISTRATOR WILL
NOTIFY THE TRUSTEE IN WRITING WHENEVER ANY PARTICIPANT OR BENEFICIARY IS
ENTITLED TO RECEIVE BENEFITS UNDER THE PLAN.  THE ADMINISTRATOR’S NOTICE SHALL
INDICATE THE FORM, AMOUNT AND FREQUENCY OF BENEFITS THAT SUCH PARTICIPANT OR
BENEFICIARY SHALL RECEIVE.

 

6.9                                 TIME OF DISTRIBUTION.  IN NO EVENT WILL
DISTRIBUTION TO A PARTICIPANT BE MADE LATER THAN THE DATE SPECIFIED BY THE
PARTICIPANT IN HIS OR HER ELECTION TO DEFER COMPENSATION; PROVIDED, HOWEVER,
THAT IF A PARTICIPANT IS A SPECIFIED EMPLOYEE, HIS OR HER ELECTION SHALL BE
SUBJECT TO THE SIX (6) MONTH DISTRIBUTION DELAY REQUIREMENTS OF THE PLAN AND
CODE SECTION 409A.

 

6.10                           LIMITATION ON DISTRIBUTIONS TO COVERED EMPLOYEES
PRIOR TO A CHANGE OF CONTROL.  NOTWITHSTANDING ANY OTHER PROVISION OF THIS
ARTICLE VI, IN THE EVENT THAT, PRIOR TO A CHANGE OF CONTROL, THE PARTICIPANT IS
A “COVERED EMPLOYEE” AS THAT TERM IS DEFINED IN SECTION 162(M)(3) OF THE CODE,
OR WOULD BE A COVERED EMPLOYEE IF HIS OR HER ACCOUNT WERE DISTRIBUTED IN
ACCORDANCE WITH HIS OR HER ELECTION, AND THE ADMINISTRATOR REASONABLY
ANTICIPATES THAT PARTICIPANT’S SCHEDULED PLAN DISTRIBUTIONS WOULD CAUSE THE
EMPLOYER TO FOREGO AN INCOME TAX DEDUCTION WITH RESPECT TO SUCH DISTRIBUTION BY
VIRTUE OF CODE SECTION 162(M), THEN SUCH PARTICIPANT’S DISTRIBUTIONS SHALL BE
DELAYED UNTIL THE EARLIER OF (I) THE EARLIEST DATE AT WHICH THE ADMINISTRATOR
REASONABLY ANTICIPATES THAT THE EMPLOYER’S DEDUCTION RELATED TO THE DISTRIBUTION
WILL NOT BE LIMITED BY VIRTUE OF CODE SECTION 162(M), OR (II) THE CALENDAR YEAR
IN WHICH THE PARTICIPANT UNDERGOES A SEPARATION FROM SERVICE, SUBJECT TO
COMPLYING WITH ANY SIX (6) MONTH DISTRIBUTION DELAY REQUIREMENTS OF THIS PLAN
AND CODE SECTION 409A.

 

6.11                           DOMESTIC RELATIONS ORDER DISTRIBUTIONS.  THE
COMMITTEE, IN ITS SOLE DISCRETION, MAY ACCELERATE A PAYMENT (OR PAYMENTS) MAKE
SUCH PAYMENTS TO AN INDIVIDUAL OTHER THAN THE PARTICIPANT AS NECESSARY TO COMPLY
WITH THE TERMS OF A DOMESTIC RELATIONS ORDER.

 

6.12                           CONFLICTS OF INTEREST AND ETHICS
RULES DISTRIBUTIONS.  THE COMMITTEE, IN ITS SOLE DISCRETION, MAY ACCELERATE A
PAYMENT (OR PAYMENTS) AS NECESSARY (I) FOR ANY U.S. FEDERAL OFFICER OR EMPLOYEE
IN THE EXECUTIVE BRANCH OF THE U.S. FEDERAL GOVERNMENT TO COMPLY WITH AN ETHICS
AGREEMENT WITH THE U.S. FEDERAL GOVERNMENT, OR (II) TO AVOID VIOLATING A U.S.
FEDERAL, STATE, LOCAL OR FOREIGN ETHICS LAW OR CONFLICTS OF INTEREST LAW, AS
SPECIFIED UNDER CODE SECTION 409A.

 

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6.13                           FICA AND RELATED INCOME TAX DISTRIBUTION.  THE
COMMITTEE, IN ITS SOLE DISCRETION, MAY PERMIT A DISTRIBUTION FROM A
PARTICIPANT’S ACCOUNT SUFFICIENT TO PAY ANY FICA AMOUNTS DUE UPON THE VESTING OF
ANY COMPANY CONTRIBUTION AS WELL AS TO SATISFY THE INCOME TAX WITHHOLDING
REQUIREMENTS WITH RESPECT TO THE FICA AMOUNT AND INCOME TAX PAYMENTS UNDER THIS
SECTION 6.13.  IN NO EVENT MAY THE TOTAL PAYMENT UNDER THIS SECTION 6.13 EXCEED
THE AGGREGATE OF THE FICA AMOUNT AND THE RELATED INCOME TAX WITHHOLDING.

 

6.14                           STATE, LOCAL AND FOREIGN TAX DISTRIBUTION.  THE
COMMITTEE, IN ITS SOLE DISCRETION, MAY PERMIT A DISTRIBUTION FROM A
PARTICIPANT’S ACCOUNT SUFFICIENT TO PAY ANY STATE, LOCAL OR FOREIGN TAX
OBLIGATIONS ARISING FROM PARTICIPATION IN THE PLAN THAT APPLY TO AN AMOUNT
DEFERRED UNDER THE PLAN PRIOR TO THE SCHEDULED DISTRIBUTION OF SUCH AMOUNT.  IN
THE EVENT THE COMMITTEE EXERCISES SUCH DISCRETION, THE COMMITTEE MAY ALSO PERMIT
A DISTRIBUTION SUFFICIENT TO PAY RELATED INCOME TAX WITHHOLDING IN ACCORDANCE
WITH CODE SECTION 409A.  IN NO EVENT MAY THE TOTAL PAYMENT UNDER THIS
SECTION 6.14 EXCEED THE AGGREGATE AMOUNT OF SUCH TAXES DUE.

 

6.15                           CODE SECTION 409A DISTRIBUTION.  IN THE EVENT
THAT THE PLAN FAILS TO SATISFY THE REQUIREMENTS OF CODE SECTION 409A, THEN THE
COMMITTEE, IN ITS SOLE DISCRETION, MAY PERMIT A DISTRIBUTION FROM A
PARTICIPANT’S ACCOUNT UP TO THE MAXIMUM AMOUNT REQUIRED TO BE INCLUDED IN INCOME
AS A RESULT OF THE FAILURE TO COMPLY WITH CODE SECTION 409A.

 

6.16                           TAX WITHHOLDING.  PAYMENTS UNDER THIS ARTICLE VI
SHALL BE SUBJECT TO ALL APPLICABLE WITHHOLDING REQUIREMENTS FOR STATE AND
FEDERAL INCOME TAXES AND TO ANY OTHER FEDERAL, STATE OR LOCAL TAXES THAT MAY BE
APPLICABLE TO SUCH PAYMENTS.

 

6.17                           SPECIAL 2008 ELECTION.  NOTWITHSTANDING OTHER
PLAN PROVISIONS, PURSUANT TO AND IN ACCORDANCE WITH IRS NOTICE 2007-86, IN THE
2008 PLAN YEAR, THE COMMITTEE HAD THE DISCRETION TO PERMIT PARTICIPANTS TO
CHANGE THE TIME AND FORM OR PAYMENT OF ACCOUNTS WITH RESPECT TO AMOUNTS CREDITED
ON AND AFTER JANUARY 1, 2005 SO LONG AS THE CHANGE DID NOT (I) ACCELERATE
PAYMENT OF AMOUNTS THAT WOULD OTHERWISE BE PAYABLE IN A FUTURE YEAR INTO THE
YEAR OF THE NEW ELECTION, AND (II) APPLY TO AMOUNTS THAT WOULD OTHERWISE BE PAID
IN THE YEAR OF THE ELECTION.

 

ARTICLE VII

CHANGE OF CONTROL

 

7.1                                 NO NEW PARTICIPANTS FOLLOWING CHANGE OF
CONTROL.  NO INDIVIDUAL MAY COMMENCE PARTICIPATION IN THE PLAN FOLLOWING A
CHANGE OF CONTROL EVENT.

 

7.2                                 DISCRETIONARY TERMINATION AND ACCELERATED
PLAN DISTRIBUTIONS 30 DAYS PRIOR TO OR WITHIN 12 MONTHS FOLLOWING A CHANGE IN
CONTROL.  THE ADMINISTRATOR, IN ITS SOLE DISCRETION, MAY TERMINATE THE PLAN AND
ACCELERATE ALL SCHEDULED PLAN DISTRIBUTIONS WITHIN 30 DAYS PRIOR TO OR 12 MONTHS
FOLLOWING A CHANGE IN CONTROL EVENT BY MEANS OF AN IRREVOCABLE ELECTION;
PROVIDED THAT SUCH TERMINATION AND DISTRIBUTION ACCELERATION COMPLIES WITH THE
REQUIREMENTS OF CODE SECTION 409A.

 

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ARTICLE VIII

TERMINATION DUE TO CORPORATE DISSOLUTION OR PURSUANT TO BANKRUPTCY COURT
APPROVAL

 

8.1                                 CORPORATE DISSOLUTION.  THE ADMINISTRATOR,
IN ITS SOLE DISCRETION, MAY TERMINATE THE PLAN AND ACCELERATE ALL SCHEDULED PLAN
DISTRIBUTIONS WITHIN 12 MONTHS FOLLOWING A CORPORATE DISSOLUTION; PROVIDED THAT
SUCH TERMINATION AND DISTRIBUTION ACCELERATION COMPLIES WITH THE REQUIREMENTS OF
CODE SECTION 409A.

 

8.2                                 BANKRUPTCY COURT APPROVAL.  THE
ADMINISTRATOR, IN ITS SOLE DISCRETION, MAY TERMINATE THE PLAN AND ACCELERATE ALL
SCHEDULED PLAN DISTRIBUTIONS PURSUANT TO BANKRUPTCY COURT APPROVAL; PROVIDED
THAT SUCH TERMINATION AND DISTRIBUTION ACCELERATION COMPLIES WITH THE
REQUIREMENTS OF CODE SECTION 409A.

 

ARTICLE IX

AMENDMENT AND TERMINATION

 

9.1                                 AMENDMENT BY EMPLOYER.  THE EMPLOYER
RESERVES THE AUTHORITY TO AMEND THE PLAN.  ANY SUCH CHANGE NOTWITHSTANDING, NO
PARTICIPANT’S ACCOUNT SHALL BE REDUCED BY SUCH CHANGE BELOW THE AMOUNT TO WHICH
THE PARTICIPANT WOULD HAVE BEEN ENTITLED IF HE HAD VOLUNTARILY LEFT THE EMPLOY
OF THE EMPLOYER IMMEDIATELY PRIOR TO THE DATE OF THE CHANGE.  THE EMPLOYER MAY
FROM TIME TO TIME MAKE ANY AMENDMENT TO THE PLAN THAT MAY BE NECESSARY TO
SATISFY CODE SECTION 409A OR ERISA.

 

9.2                                 RETROACTIVE AMENDMENTS.  AN AMENDMENT MADE
BY THE EMPLOYER IN ACCORDANCE WITH SECTION 9.1 MAY BE MADE EFFECTIVE ON A DATE
PRIOR TO THE FIRST DAY OF THE PLAN YEAR IN WHICH IT IS ADOPTED IF SUCH AMENDMENT
IS NECESSARY OR APPROPRIATE TO ENABLE THE PLAN AND TRUST TO SATISFY THE
APPLICABLE REQUIREMENTS OF CODE SECTION 409A OR ERISA OR TO CONFORM THE PLAN TO
ANY CHANGE IN FEDERAL LAW OR TO ANY REGULATIONS OR RULINGS THEREUNDER, SO LONG
AS SUCH RETROACTIVE AMENDMENT IS PERMITTED BY APPLICABLE LAW.

 

9.3                                 PLAN DEFERRAL TERMINATION.  THE EMPLOYER HAS
ADOPTED THE PLAN WITH THE INTENTION AND EXPECTATION THAT DEFERRALS WILL BE
PERMITTED INDEFINITELY.  HOWEVER, THE EMPLOYER HAS NO OBLIGATION TO MAINTAIN THE
PLAN FOR ANY LENGTH OF TIME AND MAY DISCONTINUE FUTURE COMPENSATION DEFERRALS
UNDER THE PLAN IN ADVANCE OF ANY PLAN YEAR BY WRITTEN NOTICE DELIVERED TO
ELIGIBLE PARTICIPANTS WITHOUT ANY LIABILITY FOR ANY SUCH DISCONTINUANCE.

 

9.4                                 DISTRIBUTION UPON CERTAIN PLAN
TERMINATIONS.  UPON TERMINATION OF THE PLAN OTHER THAN PURSUANT TO A CHANGE OF
CONTROL EVENT, CORPORATE DISSOLUTION OR PURSUANT TO A BANKRUPTCY COURT APPROVAL,
NO FURTHER DEFERRAL CONTRIBUTIONS OR EMPLOYER CONTRIBUTIONS SHALL BE MADE UNDER
THE PLAN, BUT ACCOUNTS OF PARTICIPANTS MAINTAINED UNDER THE PLAN AT THE TIME OF
TERMINATION SHALL CONTINUE TO BE GOVERNED BY THE TERMS OF THE PLAN UNTIL PAID
OUT IN ACCORDANCE WITH THE TERMS OF THE PLAN, PARTICIPANTS’ DEFERRAL ELECTIONS
AND THE REQUIREMENTS OF CODE SECTION 409A, WHICH LATTER SHALL TAKE PRECEDENCE
OVER THE TERMS OF THE PLAN AND PARTICIPANTS’ DEFERRAL ELECTIONS IN THE EVENT OF
ANY CONFLICT.

 

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ARTICLE X

THE TRUST

 

10.1                           ESTABLISHMENT OF TRUST.  THE EMPLOYER SHALL
ESTABLISH THE TRUST BETWEEN THE EMPLOYER AND THE TRUSTEE, IN ACCORDANCE WITH THE
TERMS AND CONDITIONS AS SET FORTH IN A SEPARATE AGREEMENT, UNDER WHICH ASSETS
ARE HELD, ADMINISTERED AND MANAGED, SUBJECT TO THE CLAIMS OF THE EMPLOYER’S
CREDITORS IN THE EVENT OF THE EMPLOYER’S INSOLVENCY, UNTIL PAID TO PARTICIPANTS
AND THEIR BENEFICIARIES AS SPECIFIED IN THE PLAN.  THE TRUST IS INTENDED TO BE
TREATED AS A GRANTOR TRUST UNDER THE CODE, AND THE ESTABLISHMENT OF THE TRUST IS
NOT INTENDED TO CAUSE PARTICIPANTS TO REALIZE CURRENT INCOME ON AMOUNTS
CONTRIBUTED THERETO.

 

ARTICLE XI

MISCELLANEOUS

 

11.1                           LIMITATION OF RIGHTS.  NEITHER THE ESTABLISHMENT
OF THE PLAN AND THE TRUST, NOR ANY AMENDMENT THEREOF, NOR THE CREATION OF ANY
FUND OR ACCOUNT, NOR THE PAYMENT OF ANY BENEFITS, WILL BE CONSTRUED AS GIVING TO
ANY PARTICIPANT OR OTHER PERSON ANY LEGAL OR EQUITABLE RIGHT AGAINST THE
EMPLOYER, ADMINISTRATOR OR TRUSTEE, EXCEPT AS PROVIDED HEREIN; AND IN NO EVENT
WILL THE TERMS OF EMPLOYMENT OR SERVICE OF ANY PARTICIPANT BE MODIFIED OR IN ANY
WAY AFFECTED HEREBY

 

11.2                           NONTRANSFERABILITY; DOMESTIC RELATIONS ORDERS. 
THE RIGHT OF ANY PARTICIPANT, ANY BENEFICIARY, OR ANY OTHER PERSON TO THE
PAYMENT OF ANY BENEFITS UNDER THIS PLAN SHALL NOT BE ASSIGNED, TRANSFERRED,
PLEDGED OR ENCUMBERED; PROVIDED, HOWEVER, THAT A DEFERRAL ACCOUNT HEREUNDER MAY
BE TRANSFERRED TO A PARTICIPANT’S FORMER SPOUSE PURSUANT TO A DOMESTIC RELATIONS
ORDER.

 

11.3                           FACILITY OF PAYMENT.  IN THE EVENT THE
ADMINISTRATOR DETERMINES, ON THE BASIS OF MEDICAL REPORTS OR OTHER EVIDENCE
SATISFACTORY TO THE ADMINISTRATOR, THAT THE RECIPIENT OF ANY BENEFIT PAYMENTS
UNDER THE PLAN IS INCAPABLE OF HANDLING HIS AFFAIRS BY REASON OF MINORITY,
ILLNESS, INFIRMITY OR OTHER INCAPACITY, THE ADMINISTRATOR MAY DIRECT THE TRUSTEE
TO DISBURSE SUCH PAYMENTS TO A PERSON OR INSTITUTION DESIGNATED BY A COURT WHICH
HAS JURISDICTION OVER SUCH RECIPIENT OR A PERSON OR INSTITUTION OTHERWISE HAVING
THE LEGAL AUTHORITY UNDER STATE LAW FOR THE CARE AND CONTROL OF SUCH RECIPIENT. 
THE RECEIPT BY SUCH PERSON OR INSTITUTION OF ANY SUCH PAYMENTS THEREFORE, AND
ANY SUCH PAYMENT TO THE EXTENT THEREOF, SHALL DISCHARGE THE LIABILITY OF THE
TRUST FOR THE PAYMENT OF BENEFITS HEREUNDER TO SUCH RECIPIENT.

 

11.4                           INFORMATION BETWEEN EMPLOYER AND TRUSTEE.  THE
EMPLOYER AGREES TO FURNISH THE TRUSTEE, AND THE TRUSTEE AGREES TO FURNISH THE
EMPLOYER WITH SUCH INFORMATION RELATING TO THE PLAN AND TRUST AS MAY BE REQUIRED
BY THE OTHER IN ORDER TO CARRY OUT THEIR RESPECTIVE DUTIES HEREUNDER, INCLUDING
WITHOUT LIMITATION INFORMATION REQUIRED UNDER THE CODE OR ERISA AND ANY
REGULATIONS ISSUED OR FORMS ADOPTED THEREUNDER.

 

11.5                           NOTICES.  ANY NOTICE OR OTHER COMMUNICATION IN
CONNECTION WITH THIS PLAN SHALL BE DEEMED DELIVERED IN WRITING IF ADDRESSED AS
PROVIDED BELOW AND IF EITHER ACTUALLY DELIVERED AT SAID

 

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ADDRESS OR, IN THE CASE OF A LETTER, THREE BUSINESS DAYS SHALL HAVE ELAPSED
AFTER THE SAME SHALL HAVE BEEN DEPOSITED IN THE UNITED STATES MAILS, FIRST-CLASS
POSTAGE PREPAID AND REGISTERED OR CERTIFIED:

 

(A)                                  IF IT IS SENT TO THE EMPLOYER OR
ADMINISTRATOR, IT WILL BE AT THE ADDRESS SPECIFIED BY THE EMPLOYER;

 

(B)                                 IF IT IS SENT TO THE TRUSTEE, IT WILL BE
SENT TO THE ADDRESS SET FORTH IN THE TRUST AGREEMENT; OR, IN EACH CASE AT SUCH
OTHER ADDRESS AS THE ADDRESSEE SHALL HAVE SPECIFIED BY WRITTEN NOTICE DELIVERED
IN ACCORDANCE WITH THE FOREGOING TO THE ADDRESSOR’S THEN EFFECTIVE NOTICE
ADDRESS.

 

11.6                           GOVERNING LAW.  THE PLAN WILL BE CONSTRUED,
ADMINISTERED AND ENFORCED ACCORDING TO ERISA, AND TO THE EXTENT NOT PREEMPTED
THEREBY, THE LAWS OF THE STATE OF CALIFORNIA.

 

11.7                           NO GUARANTEES REGARDING TAX TREATMENT;
DISCLAIMER.  PARTICIPANTS (OR THEIR BENEFICIARIES) WILL BE COMPLETELY
RESPONSIBLE FOR ALL TAXES WITH RESPECT TO ANY BENEFITS UNDER THE PLAN.  THE
ADMINISTRATOR, THE BOARD OF DIRECTORS AND THE EMPLOYER MAKE NO GUARANTEES
REGARDING THE TAX TREATMENT TO ANY PERSON OF ANY DEFERRALS OR PAYMENTS MADE
UNDER THE PLAN.  THE PLAN IS INTENDED TO COMPLY WITH THE PROVISIONS OF CODE
SECTION 409A.  NEITHER THE EMPLOYER NOR ANY OF THEIR EMPLOYEES SHALL HAVE ANY
LIABILITY TO ANY PARTICIPANT SHOULD THE PLAN OR ITS ADMINISTRATION FAIL TO
COMPLY WITH CODE SECTION 409A.

 

ARTICLE XII

PLAN ADMINISTRATION

 

12.1                           POWERS AND RESPONSIBILITIES OF THE
ADMINISTRATOR.  THE ADMINISTRATOR HAS THE FULL POWER AND THE FULL RESPONSIBILITY
TO ADMINISTER THE PLAN IN ALL OF ITS DETAILS, SUBJECT, HOWEVER, TO THE
APPLICABLE REQUIREMENTS OF ERISA.  THE ADMINISTRATOR’S POWERS AND
RESPONSIBILITIES INCLUDE, BUT ARE NOT LIMITED TO, THE FOLLOWING:

 

(A)                                  TO MAKE AND ENFORCE SUCH RULES AND
REGULATIONS AS IT DEEMS NECESSARY OR PROPER FOR THE EFFICIENT ADMINISTRATION OF
THE PLAN;

 

(B)                                 THE DISCRETIONARY AUTHORITY TO CONSTRUE AND
INTERPRET THE PLAN, ITS INTERPRETATION THEREOF IN GOOD FAITH TO BE FINAL AND
CONCLUSIVE ON ALL PERSONS CLAIMING BENEFITS UNDER THE PLAN;

 

(C)                                  TO DECIDE ALL QUESTIONS CONCERNING THE PLAN
AND THE ELIGIBILITY OF ANY PERSON TO PARTICIPATE IN THE PLAN;

 

(D)                                 TO ADMINISTER THE CLAIMS AND REVIEW
PROCEDURES SPECIFIED IN SECTION 12.3;

 

(E)                                  TO COMPUTE THE AMOUNT OF BENEFITS WHICH
WILL BE PAYABLE TO ANY PARTICIPANT, FORMER PARTICIPANT OR BENEFICIARY IN
ACCORDANCE WITH THE PROVISIONS OF THE PLAN;

 

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(F)                                    TO DETERMINE THE PERSON OR PERSONS TO
WHOM SUCH BENEFITS WILL BE PAID;

 

(G)                                 TO AUTHORIZE THE PAYMENT OF BENEFITS;

 

(H)                                 TO APPOINT SUCH AGENTS, COUNSEL,
ACCOUNTANTS, AND CONSULTANTS AS MAY BE REQUIRED TO ASSIST IN ADMINISTERING THE
PLAN;

 

(I)                                     BY WRITTEN INSTRUMENT, TO ALLOCATE AND
DELEGATE ITS RESPONSIBILITIES.

 

12.2                           NONDISCRIMINATORY EXERCISE OF AUTHORITY. 
WHENEVER, IN THE ADMINISTRATION OF THE PLAN, ANY DISCRETIONARY ACTION BY THE
ADMINISTRATOR IS REQUIRED, THE ADMINISTRATOR SHALL EXERCISE ITS AUTHORITY IN A
NONDISCRIMINATORY MANNER SO THAT ALL PERSONS SIMILARLY SITUATED WILL RECEIVE
SUBSTANTIALLY THE SAME TREATMENT.

 

12.3                           CLAIMS AND REVIEW PROCEDURES.

 

(A)                                  PURPOSE.  EVERY PARTICIPANT OR BENEFICIARY
(OR HIS OR HER REPRESENTATIVE WHO IS AUTHORIZED IN WRITING BY THE CLAIMANT TO
ACT ON HIS OR HER BEHALF) (HEREINAFTER COLLECTIVELY, “CLAIMANT”) SHALL BE
ENTITLED TO FILE WITH THE ADMINISTRATOR (AND SUBSEQUENTLY WITH THE
INDIVIDUAL(S) DESIGNATED TO REVIEW CLAIMS APPEALED AFTER BEING INITIALLY DENIED
BY THE ADMINISTRATOR (THE “REVIEW PANEL”)) A WRITTEN CLAIM FOR BENEFITS UNDER
THE PLAN.  THE ADMINISTRATOR AND REVIEW PANEL SHALL EACH BE ABLE TO ESTABLISH
SUCH RULES, POLICIES AND PROCEDURES, CONSISTENT WITH ERISA AND THE PLAN, AS IT
MAY DEEM NECESSARY OR APPROPRIATE IN CARRYING OUT ITS DUTIES AND
RESPONSIBILITIES UNDER THIS SECTION 12.3.  IN THE CASE OF A DENIAL OF THE CLAIM,
THE ADMINISTRATOR OR REVIEW PANEL, AS APPLICABLE, SHALL PROVIDE THE CLAIMANT
WITH A WRITTEN OR ELECTRONIC NOTIFICATION THAT COMPLIES WITH DEPARTMENT OF LABOR
REGULATION SECTION 2520.104B-1(C)(1).

 

(B)                                 DENIAL OF CLAIM.  IF A CLAIM IS DENIED BY
THE ADMINISTRATOR (OR ITS AUTHORIZED REPRESENTATIVE), IN WHOLE OR IN PART, THEN
THE CLAIMANT SHALL BE FURNISHED WITH A DENIAL NOTICE THAT SHALL CONTAIN THE
FOLLOWING:

 

(I)             SPECIFIC REASON(S) FOR THE DENIAL;

 

(II)          REFERENCE TO THE SPECIFIC PLAN PROVISION(S) ON WHICH THE DENIAL IS
BASED;

 

(III)       A DESCRIPTION OF ANY ADDITIONAL MATERIAL OR INFORMATION NECESSARY
FOR THE CLAIMANT TO PERFECT THE CLAIM, AND AN EXPLANATION OF WHY THE MATERIAL OR
INFORMATION IS NECESSARY; AND

 

(IV)      AN EXPLANATION OF THE PLAN’S CLAIMS REVIEW PROCEDURE AND THE TIME
LIMITS APPLICABLE TO SUCH PROCEDURES, INCLUDING A STATEMENT OF THE CLAIMANT’S
RIGHT TO BRING A CIVIL ACTION UNDER ERISA SECTION 502(A) FOLLOWING A DENIAL ON
REVIEW (AS SET FORTH IN SECTION 12.4 BELOW).

 

The denial notice shall be furnished to the Claimant no later than ninety
(90)-days after receipt of the claim by the Administrator, unless the
Administrator determines that special circumstances require

 

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an extension of time for processing the claim.  If the Administrator determines
that an extension of time for processing is required, then notice of the
extension shall be furnished to the Claimant prior to the termination of the
initial ninety (90)-day period.  In no event shall such extension exceed a
period of ninety (90)-days from the end of such initial period.  The extension
notice shall indicate the special circumstances requiring an extension of time
and the date by which the Plan expects to render the benefits determination.

 

(C)                                  CLAIM REVIEW PROCEDURE.  THE CLAIMANT MAY
REQUEST REVIEW OF THE DENIAL AT ANY TIME WITHIN SIXTY (60) DAYS FOLLOWING THE
DATE THE CLAIMANT RECEIVED NOTICE OF THE DENIAL OF HIS OR HER CLAIM.  THE
ADMINISTRATOR SHALL AFFORD THE CLAIMANT A FULL AND FAIR REVIEW OF THE DECISION
DENYING THE CLAIM AND, IF SO REQUESTED, SHALL:

 

(I)             PROVIDE THE CLAIMANT WITH THE OPPORTUNITY TO SUBMIT WRITTEN
COMMENTS, DOCUMENTS, RECORDS AND OTHER INFORMATION RELATING TO THE CLAIM FOR
BENEFITS;

 

(II)          PROVIDE THAT THE CLAIMANT SHALL BE PROVIDED, UPON REQUEST AND FREE
OF CHARGE, REASONABLE ACCESS TO, AND COPIES OF, ALL DOCUMENTS, RECORDS AND OTHER
INFORMATION (OTHER THAN DOCUMENTS, RECORDS AND OTHER INFORMATION THAT IS
LEGALLY-PRIVILEGED) RELEVANT TO THE CLAIMANT’S CLAIM FOR BENEFITS; AND

 

(III)       PROVIDE FOR A REVIEW THAT TAKES INTO ACCOUNT ALL COMMENTS,
DOCUMENTS, RECORDS AND OTHER INFORMATION SUBMITTED BY THE CLAIMANT RELATING TO
THE CLAIM, WITHOUT REGARD TO WHETHER SUCH INFORMATION WAS SUBMITTED OR
CONSIDERED IN THE INITIAL BENEFIT DETERMINATION.

 

(D)                                 IF THE CLAIM IS SUBSEQUENTLY ALSO DENIED BY
THE REVIEW PANEL, IN WHOLE OR IN PART, THEN THE CLAIMANT SHALL BE FURNISHED WITH
A DENIAL NOTICE THAT SHALL CONTAIN THE FOLLOWING:

 

(I)             SPECIFIC REASON(S) FOR THE DENIAL;

 

(II)          REFERENCE TO THE SPECIFIC PLAN PROVISION(S) ON WHICH THE DENIAL IS
BASED; AND

 

(III)       AN EXPLANATION OF THE PLAN’S CLAIMS REVIEW PROCEDURE AND THE TIME
LIMITS APPLICABLE TO SUCH PROCEDURES, INCLUDING A STATEMENT OF THE CLAIMANT’S
RIGHT TO BRING A CIVIL ACTION UNDER ERISA SECTION 502(A) FOLLOWING THE DENIAL ON
REVIEW.

 

(E)                                  THE DECISION ON REVIEW SHALL BE ISSUED
WITHIN SIXTY (60) DAYS FOLLOWING RECEIPT OF THE REQUEST FOR REVIEW.  THE PERIOD
FOR DECISION MAY, HOWEVER, BE EXTENDED UP TO ONE HUNDRED TWENTY (120) DAYS AFTER
SUCH RECEIPT IF THE REVIEW PANEL DETERMINES THAT SPECIAL CIRCUMSTANCES REQUIRE
EXTENSION.  IN THE CASE OF AN EXTENSION, NOTICE OF THE EXTENSION SHALL BE
FURNISHED TO THE CLAIMANT PRIOR TO THE EXPIRATION OF THE INITIAL SIXTY (60)-DAY
PERIOD.  IN NO EVENT SHALL SUCH EXTENSION EXCEED A PERIOD OF SIXTY (60) DAYS
FROM THE END OF SUCH INITIAL PERIOD.  THE EXTENSION NOTICE SHALL INDICATE THE
SPECIAL CIRCUMSTANCES REQUIRING AN EXTENSION OF TIME AND THE DATE BY WHICH THE
PLAN EXPECTS TO RENDER THE BENEFITS DETERMINATION.

 

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(F)                                    SPECIAL PROCEDURE FOR CLAIMS DUE TO
DISABILITY.  TO THE EXTENT AN APPLICATION FOR DISTRIBUTION AS A RESULT OF A
DISABILITY REQUIRES THE ADMINISTRATOR OR THE REVIEW PANEL, AS APPLICABLE, TO
MAKE A DETERMINATION OF DISABILITY UNDER THE TERMS OF THE PLAN, THEN SUCH
DETERMINATION SHALL BE SUBJECT TO ALL OF THE GENERAL RULES DESCRIBED IN THIS
ARTICLE, EXCEPT AS THEY ARE EXPRESSLY MODIFIED BY THIS SECTION.

 

(I)             THE INITIAL DECISION ON THE CLAIM FOR A DISABILITY DISTRIBUTION
WILL BE MADE WITHIN FORTY-FIVE (45) DAYS AFTER THE PLAN RECEIVES THE CLAIMANT’S
CLAIM, UNLESS SPECIAL CIRCUMSTANCES REQUIRE ADDITIONAL TIME, IN WHICH CASE THE
ADMINISTRATOR WILL NOTIFY THE CLAIMANT BEFORE THE END OF THE INITIAL FORTY-FIVE
(45)-DAY PERIOD OF AN EXTENSION OF UP TO THIRTY (30) DAYS.  IF NECESSARY, THE
ADMINISTRATOR MAY NOTIFY THE CLAIMANT, PRIOR TO THE END OF THE INITIAL THIRTY
(30)-DAY EXTENSION PERIOD, OF A SECOND EXTENSION OF UP TO THIRTY (30) DAYS.  IF
AN EXTENSION IS DUE TO THE CLAIMANT’S FAILURE TO SUPPLY THE NECESSARY
INFORMATION, THEN THE NOTICE OF EXTENSION WILL DESCRIBE THE ADDITIONAL
INFORMATION AND THE CLAIMANT WILL HAVE FORTY-FIVE (45) DAYS TO PROVIDE THE
ADDITIONAL INFORMATION.  MOREOVER, THE PERIOD FOR MAKING THE DETERMINATION WILL
BE DELAYED FROM THE DATE THE NOTIFICATION OF EXTENSION WAS SENT OUT UNTIL THE
CLAIMANT RESPONDS TO THE REQUEST FOR ADDITIONAL INFORMATION.  NO ADDITIONAL
EXTENSIONS MAY BE MADE, EXCEPT WITH THE CLAIMANT’S VOLUNTARY CONSENT.  THE
CONTENTS OF THE NOTICE SHALL BE THE SAME AS DESCRIBED IN SECTION 13.3(B) ABOVE. 
IF A DISABILITY DISTRIBUTION CLAIM IS DENIED IN WHOLE OR IN PART, THEN THE
CLAIMANT WILL RECEIVE NOTIFICATION, AS DESCRIBED IN SECTION 13.3(B).

 

(G)                                 IF AN INTERNAL RULE, GUIDELINE, PROTOCOL OR
SIMILAR CRITERION IS RELIED UPON IN MAKING THE ADVERSE DETERMINATION, THEN THE
DENIAL NOTICE TO THE CLAIMANT WILL EITHER SET FORTH THE INTERNAL RULE,
GUIDELINE, PROTOCOL OR SIMILAR CRITERION, OR WILL STATE THAT SUCH WAS RELIED
UPON AND WILL BE PROVIDED FREE OF CHARGE TO THE CLAIMANT UPON REQUEST (TO THE
EXTENT NOT LEGALLY-PRIVILEGED) AND IF THE CLAIMANT’S CLAIM WAS DENIED BASED ON A
MEDICAL NECESSITY OR EXPERIMENTAL TREATMENT OR SIMILAR EXCLUSION OR LIMIT, THEN
THE CLAIMANT WILL BE PROVIDED A STATEMENT EITHER EXPLAINING THE DECISION OR
INDICATING THAT AN EXPLANATION WILL BE PROVIDED TO THE CLAIMANT FREE OF CHARGE
UPON REQUEST.

 

(H)                                 ANY CLAIMANT WHOSE APPLICATION FOR A
DISABILITY DISTRIBUTION IS DENIED IN WHOLE OR IN PART, MAY APPEAL THE DENIAL BY
SUBMITTING TO THE REVIEW PANEL A REQUEST FOR A REVIEW OF THE APPLICATION WITHIN
ONE HUNDRED AND EIGHTY (180) DAYS AFTER RECEIVING NOTICE OF THE DENIAL.  THE
REQUEST FOR REVIEW SHALL BE IN THE FORM AND MANNER PRESCRIBED BY THE REVIEW
PANEL.  IN THE EVENT OF SUCH AN APPEAL FOR REVIEW, THE PROVISIONS OF
SECTION 13.3(C) REGARDING THE CLAIMANT’S RIGHTS AND RESPONSIBILITIES SHALL
APPLY.  UPON REQUEST, THE REVIEW PANEL WILL IDENTIFY ANY MEDICAL OR VOCATIONAL
EXPERT WHOSE ADVICE WAS OBTAINED ON BEHALF OF THE REVIEW PANEL IN CONNECTION
WITH THE DENIAL, WITHOUT REGARD TO WHETHER THE ADVICE WAS RELIED UPON IN MAKING
THE DETERMINATION.  THE ENTITY OR INDIVIDUAL APPOINTED BY THE REVIEW PANEL TO
REVIEW THE CLAIM WILL CONSIDER THE APPEAL DE NOVO, WITHOUT ANY DEFERENCE TO THE
INITIAL DENIAL.  THE REVIEW WILL NOT INCLUDE ANY PERSON WHO PARTICIPATED IN THE
INITIAL DENIAL OR WHO IS THE SUBORDINATE OF A PERSON WHO PARTICIPATED IN THE
INITIAL DENIAL.

 

(I)                                     IF THE INITIAL DISABILITY DISTRIBUTION
DENIAL WAS BASED IN WHOLE OR IN PART ON A MEDICAL JUDGMENT, THEN THE REVIEW
PANEL WILL CONSULT WITH A HEALTH CARE PROFESSIONAL WHO HAS APPROPRIATE TRAINING
AND EXPERIENCE IN THE FIELD OF MEDICINE INVOLVED IN THE MEDICAL JUDGMENT, AND

 

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WHO WAS NEITHER CONSULTED IN CONNECTION WITH THE INITIAL DETERMINATION NOR IS
THE SUBORDINATE OF ANY PERSON WHO WAS CONSULTED IN CONNECTION WITH THAT
DETERMINATION; AND UPON NOTIFYING THE CLAIMANT OF AN ADVERSE DETERMINATION ON
REVIEW, INCLUDE IN THE NOTICE EITHER AN EXPLANATION OF THE CLINICAL BASIS FOR
THE DETERMINATION, APPLYING THE TERMS OF THE PLAN TO THE CLAIMANT’S MEDICAL
CIRCUMSTANCES, OR A STATEMENT THAT SUCH EXPLANATION WILL BE PROVIDED FREE OF
CHARGE UPON REQUEST.

 

(J)                                     A DECISION ON REVIEW SHALL BE MADE
PROMPTLY, BUT NOT LATER THAN FORTY-FIVE (45) DAYS AFTER RECEIPT OF A REQUEST FOR
REVIEW, UNLESS SPECIAL CIRCUMSTANCES REQUIRE AN EXTENSION OF TIME FOR
PROCESSING.  IF AN EXTENSION IS REQUIRED, THE CLAIMANT WILL BE NOTIFIED BEFORE
THE END OF THE INITIAL FORTY-FIVE (45)-DAY PERIOD THAT AN EXTENSION OF TIME IS
REQUIRED AND THE ANTICIPATED DATE THAT THE REVIEW WILL BE COMPLETED.  A DECISION
WILL BE GIVEN AS SOON AS POSSIBLE, BUT NOT LATER THAN NINETY (90) DAYS AFTER
RECEIPT OF A REQUEST FOR REVIEW.  THE REVIEW PANEL SHALL GIVE NOTICE OF ITS
DECISION TO THE CLAIMANT; SUCH NOTICE SHALL COMPLY WITH THE REQUIREMENTS SET
FORTH IN PARAGRAPH (H) ABOVE.  IN ADDITION, IF THE CLAIMANT’S CLAIM WAS DENIED
BASED ON A MEDICAL NECESSITY OR EXPERIMENTAL TREATMENT OR SIMILAR EXCLUSION,
THEN THE CLAIMANT WILL BE PROVIDED A STATEMENT EXPLAINING THE DECISION, OR A
STATEMENT PROVIDING THAT SUCH EXPLANATION WILL BE FURNISHED TO THE CLAIMANT FREE
OF CHARGE UPON REQUEST.  THE NOTICE SHALL ALSO CONTAIN THE FOLLOWING STATEMENT: 
“YOU AND YOUR PLAN MAY HAVE OTHER VOLUNTARY ALTERNATIVE DISPUTE RESOLUTION
OPTIONS, SUCH AS MEDIATION.  ONE WAY TO FIND OUT WHAT MAY BE AVAILABLE IS TO
CONTACT YOUR LOCAL U.S. DEPARTMENT OF LABOR OFFICE AND YOUR STATE INSURANCE
REGULATORY AGENCY.”

 

12.4                           EXHAUSTION OF CLAIMS PROCEDURE AND RIGHT TO BRING
LEGAL CLAIM.  NO ACTION IN LAW OR EQUITY SHALL BE BROUGHT MORE THAN ONE (1) YEAR
AFTER THE REVIEW PANEL’S AFFIRMATION OF A DENIAL OF THE CLAIM, OR, IF EARLIER,
MORE THAN FOUR (4) YEARS AFTER THE FACTS OR EVENTS GIVING RISE TO THE CLAIMANT’S
ALLEGATION(S) OR CLAIM(S) FIRST OCCURRED.

 

12.5                           PLAN’S ADMINISTRATIVE COSTS.  THE EMPLOYER SHALL
PAY ALL REASONABLE COSTS AND EXPENSES (INCLUDING LEGAL, ACCOUNTING, AND EMPLOYEE
COMMUNICATION FEES) INCURRED BY THE ADMINISTRATOR AND THE TRUSTEE IN
ADMINISTERING THE PLAN AND TRUST.

 

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IN WITNESS WHEREOF, the Employer by its duly authorized officer(s), has caused
this Plan to be adopted initially effective January 1, 2005, and amended and
restated as of November 14, 2006 and November 20, 2008.

 

 

COHERENT, INC.

 

 

 

 

 

By:

/s/ Ronald Victor

 

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