Exhibit 10.10


 


 


WELLPOINT
401(k) RETIREMENT SAVINGS PLAN


 


 


Generally Effective
January 1, 2002

(As Amended through March 1, 2002)


 

















 


WellPoint
401(k) Retirement Savings Plan


 


TABLE OF
CONTENTS


 


	
   

  	
  PAGE

  
	
  ARTICLE I
  HISTORY

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II
  DEFINITIONS

  	
  1

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.01

  	
  “Account”

  	
  1

  
	
   

  	
  2.02

  	
  “Active Participant”

  	
  1

  
	
   

  	
  2.03

  	
  “Affiliated Company”

  	
  1

  
	
   

  	
  2.04

  	
  “Annuity Starting Date”

  	
  2

  
	
   

  	
  2.05

  	
  “Beneficiary”

  	
  2

  
	
   

  	
  2.06

  	
  “Code”

  	
  2

  
	
   

  	
  2.07

  	
  “Committee”

  	
  2

  
	
   

  	
  2.08

  	
  “Company”

  	
  2

  
	
   

  	
  2.09

  	
  “Compensation”

  	
  2

  
	
   

  	
  2.10

  	
  “Deferral Rate”

  	
  3

  
	
   

  	
  2.11

  	
  “Directors”

  	
  3

  
	
   

  	
  2.12

  	
  “Eligible Employee”

  	
  3

  
	
   

  	
  2.13

  	
  “Employee”

  	
  3

  
	
   

  	
  2.14

  	
  “ERISA”

  	
  3

  
	
   

  	
  2.15

  	
  “401(a)(17) Limit”

  	
  3

  
	
   

  	
  2.16

  	
  “Highly Compensated
  Employee”

  	
  3

  
	
   

  	
  2.17

  	
  “Hour of Service”

  	
  4

  
	
   

  	
  2.18

  	
  “Leased Employee”

  	
  4

  
	
   

  	
  2.19

  	
  “Non-Highly Compensated
  Employee”

  	
  4

  
	
   

  	
  2.20

  	
  “Participant”

  	
  4

  
	
   

  	
  2.21

  	
  “Participating Company”

  	
  4

  
	
   

  	
  2.22

  	
  “Plan”

  	
  4

  
	
   

  	
  2.23

  	
  “Plan
  Year”

  	
  4

  
	
   

  	
  2.24

  	
  “Regulation”

  	
  5

  
	
   

  	
  2.25

  	
  “Remuneration”

  	
  5

  
	
   

  	
  2.26

  	
  “Temporary Employee”

  	
  5

  
	
   

  	
  2.27

  	
  “Trust Agreement”

  	
  5

  
	
   

  	
  2.28

  	
  “Trustee”

  	
  5

  
	
   

  	
  2.29

  	
  “Valuation Date”

  	
  5

  
	
   

  	
  2.30

  	
  “WellPoint Common Stock”

  	
  5

  
	
   

  	
  2.31

  	
  “WellPoint Common Stock
  Fund”

  	
  5

  
	
   

  	
  2.32

  	
  “Year of Service”

  	
  5

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III SERVICE

  	
  5

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.01

  	
  Hour of Service

  	
  5

  
	
   

  	
  3.02

  	
  Year of Service

  	
  5

  
	
   

  	
  3.03

  	
  One Year Period of
  Severance

  	
  6

  



 


i

















 


	
   

  	
  3.04

  	
  Severance from Service Date

  	
  6

  
	
   

  	
  3.05

  	
  Reemployment Date

  	
  6

  
	
   

  	
  3.06

  	
  Military Service

  	
  6

  
	
   

  	
  3.07

  	
  One Month of Service

  	
  6

  
	
   

  	
  3.08

  	
  AHI Healthcare Corporation

  	
  6

  
	
   

  	
  3.09

  	
  Sharp Hospitals

  	
  6

  
	
   

  	
  3.10

  	
  Massachusetts Mutual
  Life & Health Benefits Management

  	
  7

  
	
   

  	
  3.11

  	
  Cost Care, Inc. and
  John Hancock Mutual Life Insurance Company

  	
  7

  
	
   

  	
  3.12

  	
  1997
  Transition Rule for Service Crediting for Former Cost Care and Hancock
  Employees

  	
  7

  
	
   

  	
  3.13

  	
  NCPPO

  	
  7

  
	
   

  	
  3.14

  	
  Rush Prudential

  	
  7

  
	
   

  	
  3.15

  	
  Rx
  America, LLC

  	
  7

  
	
   

  	
  3.16

  	
  BCBSGA

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV
  PARTICIPATION

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.01

  	
  General Rule

  	
  8

  
	
   

  	
  4.02

  	
  Status

  	
  8

  
	
   

  	
  4.03

  	
  Rehire and Reinstatement

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V
  CONTRIBUTIONS

  	
  8

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  5.01

  	
  Salary Deferral
  Contributions

  	
  8

  
	
   

  	
  5.02

  	
  Matching Contributions

  	
  9

  
	
   

  	
  5.03

  	
  Special Contributions

  	
  11

  
	
   

  	
  5.04

  	
  Rollover Contributions

  	
  11

  
	
   

  	
  5.05

  	
  Trust-to-Trust Transfers

  	
  11

  
	
   

  	
  5.06

  	
  Restoration

  	
  11

  
	
   

  	
  5.07

  	
  Deductibility

  	
  11

  
	
   

  	
  5.08

  	
  Mistake of Fact

  	
  11

  
	
   

  	
  5.09

  	
  Limits

  	
  12

  
	
   

  	
  5.10

  	
  Bonus Contribution

  	
  12

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI
  INVESTMENT FUNDS AND WELLPOINT COMMON STOCK

  	
  13

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  6.01

  	
  Individual
  Direction of Investments

  	
  13

  
	
   

  	
  6.02

  	
  WellPoint Common Stock Fund

  	
  13

  
	
   

  	
  6.03

  	
  Purchase Price

  	
  13

  
	
   

  	
  6.04

  	
  Voting and Tender Offers

  	
  13

  
	
   

  	
  6.05

  	
  Restriction on
  Liquidation of Units in a WellPoint Common Stock Fund

  	
  14

  
	
   

  	
  6.06

  	
  Responsibility

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII VALUATION

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII VESTING

  	
  15

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX
  IN-SERVICE WITHDRAWALS

  	
  15

  



 


ii

















 


	
   

  	
  9.01

  	
  Age
  59-1/2

  	
  16

  
	
   

  	
  9.02

  	
  Rollover Account
  Withdrawals

  	
  16

  
	
   

  	
  9.03

  	
  Post-Tax Contributions

  	
  16

  
	
   

  	
  9.04

  	
  Hardship Withdrawals

  	
  16

  
	
   

  	
  9.05

  	
  Form

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X
  LOANS

  	
  17

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  10.01

  	
  Authorization

  	
  17

  
	
   

  	
  10.02

  	
  Amount

  	
  18

  
	
   

  	
  10.03

  	
  Maximum Number

  	
  18

  
	
   

  	
  10.04

  	
  Application and Note

  	
  18

  
	
   

  	
  10.05

  	
  Individual Account

  	
  18

  
	
   

  	
  10.06

  	
  Interest

  	
  18

  
	
   

  	
  10.07

  	
  Repayment

  	
  18

  
	
   

  	
  10.08

  	
  Default

  	
  18

  
	
   

  	
  10.09

  	
  Guidelines

  	
  18

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI
  DISTRIBUTION OF BENEFITS

  	
  19

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  11.01

  	
  Date Benefits Become
  Distributable

  	
  19

  
	
   

  	
  11.02

  	
  Date Benefits Will Be
  Distributed

  	
  19

  
	
   

  	
  11.03

  	
  No Election

  	
  19

  
	
   

  	
  11.04

  	
  Retroactive Payment

  	
  19

  
	
   

  	
  11.05

  	
  Inability to Locate
  Recipient

  	
  19

  
	
   

  	
  11.06

  	
  Distribution to
  Minor or Incompetent

  	
  19

  
	
   

  	
  11.07

  	
  Small Account

  	
  20

  
	
   

  	
  11.08

  	
  Form of Distribution

  	
  20

  
	
   

  	
  11.09

  	
  Distributions
  from the WellPoint Common Stock Fund

  	
  20

  
	
   

  	
  11.10

  	
  Direct Rollover

  	
  20

  
	
   

  	
  11.11

  	
  General Waiver of 30-Day
  Requirement

  	
  21

  
	
   

  	
  11.12

  	
  Special Waiver of
  30-Day Requirement

  	
  21

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XII BENEFICIARY
  DESIGNATIONS

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  12.01

  	
  All Participants

  	
  22

  
	
   

  	
  12.02

  	
  Married Participants

  	
  22

  
	
   

  	
  12.03

  	
  Ineffective Designation

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIII CLAIMS PROCEDURE

  	
  22

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XIV ALIENATION AND
  QUALIFIED DOMESTIC RELATIONS ORDERS

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  14.01

  	
  Prohibition

  	
  23

  
	
   

  	
  14.02

  	
  Qualified Domestic
  Relations Order

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XV
  ADMINISTRATION

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  15.01

  	
  Committee

  	
  23

  
	
   

  	
  15.02

  	
  Power

  	
  23

  



 


iii

















 


	
   

  	
  15.03

  	
  Indemnification

  	
  23

  
	
   

  	
  15.04

  	
  Expenses

  	
  23

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XVI AMENDMENTS

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  16.01

  	
  Directors

  	
  24

  
	
   

  	
  16.02

  	
  Officers

  	
  24

  
	
   

  	
  16.03

  	
  Effect

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XVII TERMINATION, MERGER
  AND TRANSFER

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  17.01

  	
  Participating Companies

  	
  24

  
	
   

  	
  17.02

  	
  Company

  	
  24

  
	
   

  	
  17.03

  	
  Determination of
  Partial Termination

  	
  24

  
	
   

  	
  17.04

  	
  Mergers and Transfers

  	
  24

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XVIII MISCELLANEOUS

  	
  25

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  18.01

  	
  Limitation of Rights

  	
  25

  
	
   

  	
  18.02

  	
  Satisfaction of Claims

  	
  25

  
	
   

  	
  18.03

  	
  Construction

  	
  25

  
	
   

  	
  18.04

  	
  Severability

  	
  25

  
	
   

  	
  18.05

  	
  Source of Benefits

  	
  25

  



 


iv

















 


	
  APPENDIX
  I

  	
  TESTING
  SALARY DEFERRAL AND MATCHING CONTRIBUTIONS

  
	
   

  	
   

  	
   

  
	
  APPENDIX II:

  	
  LIMITATIONS ON ALLOCATIONS

  
	
   

  	
   

  	
   

  
	
  APPENDIX III:

  	
  TOP HEAVY PROVISIONS

  
	
   

  	
   

  	
   

  
	
  APPENDIX IV:

  	
  PARTICIPATION OF UNICARE FINANCIAL CORP.
  EMPLOYEES

  
	
   

  	
   

  	
   

  
	
  APPENDIX
  V:

  	
  PARTICIPATION
  OF COST CARE INC. EMPLOYEES

  
	
   

  	
   

  	
   

  
	
  APPENDIX VI:

  	
  PARTICIPATION OF JOHN HANCOCK MUTUAL LIFE
  INSURANCE EMPLOYEES

  
	
   

  	
   

  	
   

  
	
  APPENDIX VII:

  	
  PARTICIPATING COMPANIES

  
	
   

  	
   

  	
   

  
	
  APPENDIX VIII:

  	
  DISTRIBUTION PROVISIONS

  
	
   

  	
   

  	
   

  
	
  APPENDIX IX:

  	
  MERGER OF NATIONAL CAPITAL PREFERRED
  PROVIDER ORGANIZATION, INC. 401(k) PLAN

  
	
   

  	
   

  	
   

  
	
  APPENDIX
  X:

  	
  MERGER
  OF RUSH PRUDENTIAL HEALTH PLANS RETIREMENT PLAN

  
	
   

  	
   

  	
   

  
	
  APPENDIX XI:

  	
  MERGER OF BLUE CROSS AND BLUE SHIELD OF
  GEORGIA, INC. TAX-FAVORED SAVINGS PROGRAM

  



 


v

















 


WELLPOINT
401(k) RETIREMENT SAVINGS PLAN


 


ARTICLE I


 


HISTORY


 


Effective July 1, 1992, Blue Cross of California
adopted the Salary Deferral Savings Program of Blue Cross of California.  This plan received a favorable IRS
determination letter in November of 1995, and was subsequently
amended.  In 1996, the name of the plan
was changed to Salary Deferral Savings Program of WellPoint Health Networks
Inc.  Effective
November 1, 1998, the name of the plan was changed to WellPoint
401(k) Retirement Savings Plan (“Plan”).


 


Effective January 1, 1997, the Plan was restated
to incorporate changes made during the 1995 determination process (“First 1997
Restatement”).  The Plan was
subsequently restated effective January 1, 1997 (“Second 1997
Restatement”) to incorporate six prior amendments to the First 1997
Restatement, including the mergers into the Plan of the National Capital
Preferred Provider Organization, Inc. 401(k) Plan and the Rush Prudential
Health Plans Retirement Plan.  Effective
January 1, 2002, the Plan is again restated to reflect four amendments to
the Second 1997 Restatement, including the merger of the Blue Cross and Blue Shield
of Georgia, Inc. Tax-Favored Savings Program and final GUST compliance
amendments.


 


The rights and benefits of a Participant in this Plan
who ceased to be an Employee before January 1, 2002 will be determined in
accordance with the provisions of the Plan in effect on the date on which that
Participant ceased to be an Employee, and any provisions of this Plan that are
specifically made effective to such date.


 


ARTICLE II


 


DEFINITIONS


 


This Plan is subject to technical restrictions that
are outlined in Appendices which, by this reference, are incorporated into the
Plan.  Terms that are used in a single
Article or Appendix are generally defined in that Article or
Appendix.  The following terms are used
throughout the Plan.


 


2.01                           “Account” means the value of all Accounts maintained on
behalf of a Participant or Beneficiary. 
An Account may include a Special Contributions Account, a Salary
Deferral Contributions Account, Matching Contributions Accounts, a Loan
Account, Rollover Accounts, a Profit Sharing Contributions Account, and a
Post-Tax Contributions Account.


 


2.02                           “Active Participant” means a Participant with
a Salary Deferral Contribution election currently in effect.


 


2.03                           “Affiliated Company” means a Participating
Company and, with respect to a Participating Company, (i) any corporation that,
pursuant to Section 414(b) of the Code, is a


 


1

















 


member of a controlled
group of corporations of which the Participating Company is a member;
(ii) any employer that, pursuant to Section 414(c) of the Code, is
under common control with the Participating Company; (iii) any employer that,
pursuant to Section 414(m) of the Code, is a member of an affiliated
service group of which the Participating Company is a member and (iv) any
employer that, pursuant to Section 414(o) of the Code, is required to be
aggregated with the Participating Company.


 


2.04                           “Annuity Starting Date” means the first
date for which an amount is payable as an annuity or, in the case of a benefit
not payable as an annuity, the first day on which all events have occurred that
entitle a Participant, or Beneficiary, as the case may be, to a benefit under
this Plan.


 


2.05                           “Beneficiary” means the person(s) or entity entitled
to receive a Participant’s Account if the Participant dies before distribution
of his or her entire Account.


 


2.06                           “Code” means the Internal Revenue Code of 1986, as amended.


 


2.07                           “Committee” means the entity that, pursuant to
Article XV, administers the Plan.


 


2.08                           “Company” means, effective May 20, 1996, WellPoint
Health Networks Inc. or a successor to all or a major portion of the assets or
business of WellPoint Health Networks Inc. that, by appropriate action, adopts
the Plan.


 


2.09                           “Compensation” means all regular base earnings paid
by a Participating Company.


 


(a)                                  Amounts
Included.  A reference to
Compensation also includes, but is not limited to, the following items, subject
to subsection (c):


 


(1)                                  vacation
pay;


 


(2)                                  salary
continuance (other than severance);


 


(3)                                  sick
leave paid by a Participating Company;


 


(4)                                  salary
deferrals under the WellPoint Health Networks Inc. Comprehensive Executive
Non-Qualified Retirement Plan;


 


(5)                                  sales
commissions;


 


(6)                                  overtime;


 


(7)                                  elective
contributions that are not includible in income under Code Sections 125,
402(e)(3), 402(h) or 403(b);


 


(8)                                  all
bonuses (other than starting bonuses) and incentive payments (other than
Instabucks); and


 


(9)                                  pay
in-lieu-of vacation days or floating holidays that are unused at a
Participant’s termination of employment prior to 1998 or occurring in the
period starting January 1, 2000 and ending
February 27, 2001.


 


2

















 


(b)                                 Exclusions.  Base earnings does not include:


 


(1)                                  severance
pay;


 


(2)                                  imputed
income;


 


(3)                                  moving
expenses;


 


(4)                                  awards
(including, but not limited to, Honor, Impact, Recognition, car pool, and
general awards); or


 


(5)                                  payments
made under any group insurance plan.


 


(c)                                  Exceptions.  Compensation shall not include pay in lieu
of vacation days or pay in lieu of any category of paid time off that is unused
at a Participant’s termination of employment.


 


2.10                           “Deferral Rate” means the percentage of
Compensation that a Participant elects to defer as described in
Section 5.01.


 


2.11                           “Directors” means the Board of Directors of the
Company.


 


2.12                           “Eligible Employee” means an Employee of a
Participating Company, other than (i) an Employee who has not attained the age
of eighteen (18), (ii) a Leased Employee, (iii)  a Temporary Employee, (iv) a non-resident alien who receives no
earned income from sources within the United States, and (iv) an Employee whose
employment is governed by the terms of a collective bargaining agreement,
unless a Participating Company is a party to the agreement and the agreement
provides for coverage of the Employee under this Plan.


 


An Eligible Employee does
not include (and has not at any time included) any individual during any period
that individual is not classified or treated by an Affiliated Company as a
common-law employee of an Affiliated Company, without regard to whether such
individual is subsequently determined to have been a common-law employee of an
Affiliated Company.


 


Notwithstanding anything
to the contrary in any Plan document, the collective bargaining agreement
between Blue Cross of California and the Office and Professional Employees
International Union Local 29, AFL-CIO that became effective
November 16, 1994 governs the determination as to whether individuals
covered by that agreement for the period beginning November 16, 1994
and ending on the date that the terms of that agreement expire are Eligible
Employees for purposes of the participation provisions of the Plan.


 


2.13                           “Employee” means a person who is employed by an
Affiliated Company and any Leased Employee.


 


2.14                           “ERISA” means the Employee Retirement Income Security Act
of 1974, as amended.


 


2.15                           “401(a)(17) Limit” means the indexed limit on
compensation that may be taken into account under the Plan as provided under
Section 401(a)(17) of the Code.


 


2.16                           “Highly Compensated Employee” means
(i) any 5% owner during the current Plan Year or the preceding Plan Year (the
“lookback year”) and (ii) any Employee


 


3

















 


receiving Remuneration
from a Participating Company in the lookback year in excess of $80,000 (indexed
consistent with Code Section 414(q)) without regard to whether the
Employee is in the top 20% of Employees ranked by Remuneration.


 


2.17                           “Hour of Service” is defined in Article III.


 


2.18                           “Leased Employee” means an individual who is not
otherwise an Employee and who, pursuant to Code Section 414(n), performs
services under primary direction or control of a Participating Company on a
substantially full-time basis.  Notwithstanding
the foregoing, an individual will not be treated as a Leased Employee for a
Plan Year for nondiscrimination testing or for any other purpose if either (a)
or (b) below is applicable for that Plan Year:


 


(a)                                  Safeharbor
Plan.  The individual is covered by
a money purchase pension plan maintained by the leasing organization meeting
the requirements of Code Section 414(n)(5)(B), and leased employees
(determined without regard to this exception) do not constitute more than 20%
of all Non-Highly Compensated Employees of all Affiliated Companies.


 


(b)                                 Recordkeeping
Exception.  The Committee has not
been notified by the individual that the individual is a leased employee, the
qualified plans (within the meaning of Code Section 401(a)) that are
maintained by each Affiliated Company exclude leased employees from
participation, none of these plans is top heavy (within the meaning of Code
Section 416), and the number of leased persons who, during that Plan Year,
perform at least 1500 Hours of Service of work described in Code Sections
414(n)(2)(A) and (C) for any Affiliated Company is less than 5% of the number
of Employees (excluding leased persons and Highly Compensated Employees)
covered by the qualified plans (within the meaning of Code Section 401(a))
of all Affiliated Companies at any time during the Plan Year.


 


2.19                           “Non-Highly Compensated Employee”
is an Employee who is not a Highly Compensated Employee.


 


2.20                           “Participant” means (i) an Eligible Employee who
becomes a Participant under Article IV or Article V, (ii) an
individual not described in clause (i) who had an Account balance in another
tax-qualified retirement plan as of the date such plan is merged with the Plan,
and (iii) an Employee of an Affiliated Company that is not a Participating
Company who receives an allocation of a Bonus Contribution as described in
Section 5.10.  An individual
described in clauses (i) through (iii) will be a Participant only for the
period an Account is maintained under the Plan for such individual.


 


2.21                           “Participating Company” means the Company
and any other company that is authorized in writing by the Directors or by an
officer of the Company at the level of Senior Vice President or above to
participate in the Plan, and that elects to participate in the Plan on behalf
of its Eligible Employees.  Entities
that are Participating Companies as of January 1, 2001 are listed in
the Participating Companies Appendix to this Plan.


 


2.22                           “Plan” means, effective November 1, 1998, the
WellPoint 401(k) Retirement Savings Plan as amended from time to time.  Prior to November 1, 1998, the
name of the Plan was the Salary Deferral Savings Program of WellPoint Health
Networks Inc.


 


2.23                           “Plan Year” means the calendar year.


 


4

















 


2.24                           “Regulation” means Treasury Regulations issued under
provisions of the Internal Revenue Code.


 


2.25                           “Remuneration” means compensation as defined in
Code Section 415(c)(3) and in accordance with Treasury Regulation sections
1.415-2(d)(2) and 1.415-2(d)(3).  This
alternate definition of compensation is used for purposes of the Highly
Compensated Employee definition in Section 2.16 and the Testing Salary
Deferral and Matching Contributions Appendix, the Limitations on Allocations
Appendix and the Top Heavy Appendix to this Plan.  Remuneration also includes an Employee’s elective deferrals under
a qualified cash or deferred arrangement described in Code Sections 401(k) and
402(e)(3), a simplified employee pension plan described in Code
Section 408(k)(6) and a cafeteria plan described in Code Section 125
and elective salary reductions not includible in gross income as a qualified
transportation fringe under Code Section 132(f)(4).


 


2.26                           “Temporary Employee” means an Employee who is
categorized as a temporary employee by a Participating Company and who performs
fewer than 1000 Hours of Service during any consecutive 12-month period.


 


2.27                           “Trust Agreement” means an agreement entered into
between the Company (on behalf of all Participating Companies) and a Trustee to
provide for the investment, management and control of Plan assets.


 


2.28                           “Trustee” means any person or entity appointed by the
Company to hold the Plan’s assets.


 


2.29                           “Valuation Date” means the last business day of
each Plan Year, and such other date or dates as may be designated by the
Committee for the valuation of Accounts.


 


2.30                           “WellPoint Common Stock” means the common
stock of the Company.


 


2.31                           “WellPoint Common Stock Fund” means the
investment fund established by the Committee to permit investment of
Participants’ Accounts in WellPoint Common Stock.


 


2.32                           “Year of Service” is defined in Article III
of the Plan.


 


ARTICLE III


 


SERVICE


 


3.01                           Hour of Service.  An Hour of Service is each hour for which an
Employee is paid or entitled to payment for the performance of services for an
Affiliated Company.


 


3.02                           Year of Service.  A Year of Service is a consecutive or
non-consecutive 12-month period beginning on the first date that an Employee
performs an Hour of Service, on a Reemployment Date (as defined below) or on an
anniversary of either of these dates.  Any period of less than 12 consecutive months during which an
Employee does not perform an Hour of Service will be counted when computing
Years of Service.  A One Year (or longer)
Period of Severance (as defined below) will not be counted when computing Years
of Service.


 


5

















 


3.03                           One Year Period of Severance.  A One Year Period of Severance is a 12
consecutive month period that begins on an individual’s Severance from Service
Date (as defined below), or on an anniversary of that date, during which the
individual does not perform an Hour of Service.


 


3.04                           Severance from Service Date.  An Employee’s Severance from Service Date is
the earliest of the date on which the Employee quits, retires, is discharged or
dies, or the first anniversary of the first date of an Employee’s absence for
any other reason.


 


(a)                                  Crediting.  Solely for the purpose of determining
whether a Participant has incurred a One Year Period of Severance, a
Participant will not incur the first One Year Period of Severance that would
otherwise be counted if severance is due to an Authorized Leave of Absence (as
defined below) or a Maternity or Paternity Leave (as defined below).


 


(b)                                 Authorized
Leave of Absence.  Authorized Leave
of Absence means a paid or unpaid, temporary cessation from active employment
with an Affiliated Company for up to 12 months pursuant to an established
policy, due to illness, disability, vacation, a temporary layoff, public
service, or any other reason.


 


(c)                                  Maternity
or Paternity Leave.  Maternity or
Paternity Leave means an unpaid absence from work for any period by reason of
the Employee’s pregnancy, birth of the Employee’s child, placement of a child
with the Employee in connection with the adoption of such child, or any absence
for the purpose of caring for such child for a period immediately following
such birth or placement.


 


(d)                                 Failure
to Return.  If a Participant fails
to return to work immediately on expiration of an Authorized Leave of Absence
or Maternity or Paternity Leave, no credit shall be given for the Authorized
Leave of Absence or Maternity or Paternity Leave pursuant to this Section.


 


3.05                           Reemployment Date.  An Employee’s Reemployment Date is the first date on which the
Employee performs an Hour of Service after a One Year Period of Severance.


 


3.06                           Military Service.  Notwithstanding any provision of this Plan to the contrary,
contributions and benefits with respect to qualified military service will be
provided to the extent required by Code Section 414(u) effective
December 12, 1994.


 


3.07                           One Month of Service.  An Employee will be credited with One Month
of Service on the date that the Employee has been on the payroll of an
Affiliated Company, as an Employee, for one full calendar month.


 


3.08                           AHI Healthcare Corporation.  Effective for Employees hired on or after
April 1, 1995 and before October 1, 1997, those Employees will have
all of their service with AHI Healthcare Corporation (or any wholly owned
subsidiary thereof) prior to April 1, 1995 treated as service with the
Company for all purposes under this Plan; provided, however, that such
Employees will not be eligible to receive Matching Contributions under this
Plan.


 


3.09                           Sharp Hospitals.  Individuals who were employed by Sharp Hospitals on February 4,
1996, and who became Employees due to a corporate transaction on
February 5, 1996, will receive credit under this Plan for all of their
service with Sharp Hospitals; provided,


 


6

















 


however, that no such service
will be credited for purposes of determining whether an individual is eligible
for the Grandfathered Match that was implemented in 1997.


 


3.10                           Massachusetts Mutual Life & Health
Benefits Management.  Effective for
Employees hired on or after April 1, 1996 and before October 1, 1997,
those Employees will have all of their service with Massachusetts Mutual Life
Insurance Company prior to April 1, 1996 treated as service with the
Company for all purposes under this Plan except for purposes of the Grandfathered
Match that was implemented in 1997.


 


3.11                           Cost
Care, Inc. and John Hancock Mutual Life
Insurance Company.  Individuals
who were employed by Cost Care, Inc. (“Cost Care”) or by John Hancock Mutual
Life Insurance Company (“Hancock”) on February 28, 1997, and who became
Employees due to a corporate transaction on March 1, 1997 (each a
“Transferred 1997 Employee”) will receive credit under this Plan for all of
their service with Cost Care and/or with Hancock through December 31,
1996; provided, however, that no such service will be credited for purposes of
determining whether an individual is eligible for the Grandfathered Match that
was implemented in 1997.  Effective
January 1, 1997, the elapsed time service crediting rules of this Plan
will apply for crediting service to Transferred 1997 Employees.  For these purposes, a Participant’s service
under the Cost Care, Inc. Savings Plan and/or the Investment-Incentive Plan for
John Hancock Employees, as the case may be, from January 1, 1997 through
the date (“Hire Date”) in 1997 that the individual became an Employee of the
Company will be added to the Participant’s service under this Plan from the
Participant’s Hire Date forward.


 


3.12                           1997
Transition Rule for Service
Crediting for Former Cost Care and Hancock Employees.  For the Plan Year ending December 31,
1997, a Transferred 1997 Employee who would not otherwise be credited with one
Year of Service under the service crediting rules of this Plan (other than this
rule) will be credited with one Year of Service under this Plan if the
Transferred 1997 Employee was credited with 1000 Hours of Service under the
Cost Care, Inc. Savings Plan or under the Investment-Incentive Plan for Hancock
Employees for the period beginning January 1, 1997 and ending on his or her
Hire Date.  Notwithstanding the
foregoing, no such service will be used to determine whether an individual is
eligible for the Grandfathered Match that was implemented in 1997.


 


3.13                           NCPPO. 
Individuals who were employed by National Capital Preferred Provider
Organization, Inc. (“NCPPO”) immediately prior to June 1, 1999, and
who became Employees due to a corporate transaction on June 1, 1999,
will receive credit under the Plan for all of their service with NCPPO,
provided, however, that no such service will be credited for purposes of
determining whether an individual is eligible for the Grandfathered Match that
was implemented in 1997. 


 


3.14                           Rush Prudential.  Individuals who were employed by Rush Prudential Health Plans
(“Rush Prudential”) immediately prior to March 1, 2000, and who
became Employees due to a corporate transaction on March 1, 2000,
will receive credit under the Plan for all of their service with Rush
Prudential, provided, however, that no such service will be credited for
purposes of determining whether an individual is eligible for the Grandfathered
Match that was implemented in 1997.  


 


3.15                           Rx America, LLC.  Individuals who were employed by Rx America, LLC (“Rx America”)
immediately prior to December 5, 2000, and who became Employees due
to a corporation transaction on December 5, 2000, will receive credit
under the Plan for all of their


 


7

















 


service with Rx America,
provided, however, that no such service will be credited for purposes of
determining whether an individual is eligible for the Grandfathered Match that
was implemented in 1997.


 


3.16                           BCBSGA.  Each
individual employed by Blue Cross and Blue Shield of Georgia, Inc. (“BCBSGA”)
on May 31, 2001 who becomes an Eligible Employee in connection with
the merger of the Blue Cross and Blue Shield of Georgia, Inc. Tax-Favored
Savings Program (the “Georgia Savings Program”) into the Plan on
June 1, 2001 (the “Plan Merger Date”) will receive credit under the
Plan for all service with BCBSGA completed prior to the Plan Merger Date,
provided, however, that no such Eligible Employee will be eligible for the
Grandfathered Match implemented in 1997 regardless of his or her aggregated
service.


 


ARTICLE IV

PARTICIPATION


 


4.01                           General Rule. 
An Eligible Employee can elect to become a Participant on the first day
of the first calendar month coincident with or next following the earlier
of the following dates by entering into a Salary Deferral Contribution
election:


 


(a)                                  One
Month of Service.  The date on which
the Eligible Employee has been credited with One Month of Service; or


 


(b)                                 One
Year of Service.  The date that the
Eligible Employee has been credited with a Year of Service.


 


4.02                           Status.  If an
Employee is not an Eligible Employee on the date that he or she has satisfied
the applicable participation requirements outlined above, the Employee can
elect to become a Participant on the first day of the calendar month coincident
with or next following the calendar month in which the Employee performs an
Hour of Service as an Eligible Employee.


 


4.03                           Rehire and Reinstatement.  A rehired individual or a reinstated
individual who is an Eligible Employee and who previously satisfied the
eligibility requirements in this Section will become an Active Participant
on the first day of the calendar month following the month in which the
individual enters into a Salary Deferral Contribution election.


 


ARTICLE V


 


CONTRIBUTIONS


 


5.01                           Salary Deferral Contributions.  A Participant may elect to have a
Participating Company reduce the amount of his or her Compensation for each
payroll period by from 2% to 15% and to have that amount contributed to the
Plan as a Salary Deferral Contribution on his or her behalf.  In no event will a Participant’s total
Salary Deferral Contribution for a Plan Year exceed the indexed limit
determined under Code Section 402(g). 
A Participant may initiate or change the percentage of Salary Deferral
Contribution (in 1%


 


8

















 


increments) by submitting
a notice to the Committee that satisfies such requirements as the Committee
shall determine.  In no event will a
Participant’s Salary Deferral Contribution for a Plan Year exceed an amount
equal to the Participant’s Deferral Rate times the 401(a)(17) Limit in effect
for the Plan Year.  The Committee will
implement the Participant’s Salary Deferral Contribution election as soon as
administratively practicable.


 


(a)                                  Allocation.  A Participant’s Salary Deferral
Contributions will be credited to that Participant’s Salary Deferral
Contributions Account.


 


(b)                                 Highly
Compensated Limit.  The Committee or
its delegate may limit the amount of Compensation that Highly Compensated
Employees (determined as of the end of the immediately preceding Plan Year) are
authorized to defer under this Plan as Salary Deferral Contributions.


 


5.02                           Matching Contributions.  A Participant’s Matching Contributions will
be credited to that Participant’s Matching Contributions Account.  Unless provided otherwise in a writing
signed by an officer of the Company at the level of Senior Vice President or
above, and subject to the provisos in (b), (c), (d), (e), (f) and (g) below,
for payroll periods ending on or after January 1, 1997, the
schedule outlined in (a) below will be used to determine the amount of
Matching Contributions and the match will be made in units of a WellPoint
Common Stock Fund to the extent provided in (c) below.


 


(a)                                  General
Rule.  Except as provided in (b)
below, effective November 1, 1998, Matching Contributions will equal
75% (or a greater or lesser percentage determined by each Participating Company
before the payroll period) of the Salary Deferral Contribution that the
Participant directed during the Plan Year, while eligible for Matching
Contributions as provided in Section 5.02(g) of the Plan.  Notwithstanding the foregoing, Salary
Deferral Contributions in excess of 6% of a Participant’s Compensation (or such
greater or lesser percentage determined by each Participating Company before
the payroll period) will not be matched. 
In no event will a Participant’s Matching Contributions for a Plan Year
exceed 6% (or such greater or lesser percentage determined by each
Participating Company before the payroll period) of the 401(a)(17) Limit in
effect for the Plan Year.  To the extent
administratively feasible, Matching Contributions will be credited to a
Participant’s Account on a payroll period by payroll period basis.


 


(b)                                 Grandfathered
Match.  Effective
November 1, 1998, the provisions on this subsection (b) will
govern the calculation of the Matching Contribution of a Participant with 10 or
more years of Service at the beginning of the first payroll period ending after
January 1, 1997 other than a Participant covered by a collective
bargaining agreement as described in Section 5.02(d) below.  For Participants with 10 or more but less
than 20 Years of Service at the beginning of the first payroll period ending on
or after January 1, 1997, Matching Contributions will equal 85% of the
Salary Deferral Contribution that the Participant directed during the Plan
Year, while eligible for Matching Contributions as provided in
Section 5.02(g) of the Plan.  For
Participants with 20 or more Years of Service at the beginning of the first
payroll period ending on or after January 1, 1997, Matching Contributions
will equal 100% of the Salary Deferral Contribution that the Participant
directed during the Plan Year, while eligible for Matching Contributions as
provided in Section 5.02(g) of the Plan. 
Notwithstanding the foregoing, Salary Deferral Contributions in excess
of 6% of a Participant’s Compensation will not be matched.  To the extent administratively feasible,
Matching Contributions will be credited to a Participant’s Account on a payroll
period by payroll period basis.  In no
event will any other


 


9

















 


provision of the Plan
granting service credit with a prior employer while such employer is not an
Affiliated Company be taken into account in determining eligibility for the
Grandfathered Match described in this subsection (b).


 


(c)                                  Match
in Units of WellPoint Common Stock Fund. 
Effective as of the first payroll period ending on or after
January 1, 1998, all Participants eligible to receive an allocation of
Matching Contributions as described in subsections (a) and (b) above will
receive 33.33% of their Matching Contribution in the form of units of a
WellPoint Common Stock Fund.


 


(d)                                 Collective
Bargaining Agreement.  If the
employment of an Eligible Employee is governed by the terms of a collective
bargaining agreement (“Bargaining Unit Employee”) between Blue Cross of
California and the Office and Professional Employees International Union Local
29, AFL-CIO that became effective November 16, 1997 (“Local 29
Agreement”), the Company will cover that Bargaining Unit Employee in the Plan
as in effect on the effective date of the Local 29 Agreement, and as the Plan
may be changed to comply with applicable law. 
The Matching Contributions rate for such Bargaining Unit Employees who
are employed by Blue Cross of California on November 16, 1997
(“Eligible Local 29 Employees”) and who have one Year of Service, but less than
10 Years of Service will be 75% of the Participant’s Salary Deferral
Contribution for the Plan Year; for Eligible Local 29 Employees with 10 or more
Years of Service but less than 20, the rate will be 85% of the Participant’s
Salary Deferral Contribution for the Plan Year; for Eligible Local 29 Employees
with 20 Years of Service, the rate will be 100% of the Participant’s Salary Deferral
Contribution for the Plan Year.  The
rate of Matching Contributions for all Eligible Local 29 Employees will be
frozen at November 15, 2000 levels, based on each such Employee’s
Years of Service at that date.  With
respect to any other Bargaining Unit Employee, the level and the form (e.g.,
stock or cash) of Matching Contributions provided to such Employees will be
governed by the terms of the applicable bargaining agreement.


 


(e)                                  Leave.  Prior to October 1, 1997, this
subsection (e) read as follows:  Notwithstanding anything to the contrary in this Plan, a
Participant’s eligibility to receive Matching Contributions will cease as of
the first day of the first full payroll period immediately following 8
consecutive work days (excluding week-ends and holidays) during which the
Participant was absent from work due to a paid sick leave.  Such a Participant will again become
eligible to receive Matching Contributions, as otherwise provided under this
Section, as of the first day of the first full payroll period immediately
following the Participant’s return to work after such a leave.  Subsection (e) is eliminated from the
Plan effective October 1, 1997.


 


(f)                                    No
Match.  Notwithstanding anything to
the contrary in this Plan, if WellPoint Practice Management Company, Inc.
(formerly known as WellPoint Dental Services, Inc.), The Professional Medical
Associates of Santa Barbara, Health Management Associates of San Luis Obispo,
Health Management Associates of Santa Barbara, and/or any successor to any of
them become a Participating Company, their Employees will not be eligible to
receive Matching Contributions under this Plan.


 


(g)                                 Match
Eligibility.  Effective for the
first payroll period ending on or after October 1, 1997, an Employee
is not eligible to receive a Matching Contribution under this Plan for
Compensation earned prior to the payroll period during which the Participant is
credited with a Year of Service measured from his or her date of hire (if a new
Employee) or


 


10

















 


date of rehire (following
the Employee’s separation from service with all Affiliated Companies for any
reason).  For this purpose, a
reinstatement is not treated as a rehire.


 


5.03                           Special Contributions.  Other than a Bonus Contribution described in
Section 5.10 below, a Participating Company may authorize qualified
nonelective employer contributions to the extent needed to satisfy the tests
described in the Testing Salary Deferral and Matching Contributions Appendix to
this Plan.  These qualified nonelective
employer contributions will be allocated to the Accounts of Eligible Employees
who are Non-Highly Compensated Employees from the lowest paid to the highest
paid in an amount up to or equal to their Code Section 415 allocation
limit.


 


5.04                           Rollover Contributions.  The Committee or its delegate may authorize
a Trustee to accept a contribution, that represents all or part of an Eligible
Rollover Distribution as defined in Section 11.10(a), made in cash and
attributable to a distribution received by an Eligible Employee from another
tax-qualified plan.  Rollover
Contributions will be held in the Participant’s Rollover Account.  Rollover Contributions from an IRA established
to hold only distributions from a tax-qualified plan within the meaning of
Section 401(a) of the Code (e.g., a “Conduit IRA”) will be accepted after
1997.


 


5.05                           Trust-to-Trust Transfers.


 


(a)                                  Permissible
Transfers.  The Committee or its
delegate may authorize a Trustee to accept a trust-to-trust transfer of assets
from another tax-qualified plan within the meaning of Section 401(a) of
the Code.  Except as specifically
provided to the contrary in this Plan document, securities of other companies
and assets that are subject to the survivor annuity requirements of Code
Section 401(a)(11) will not be accepted as part of a trust-to-trust
transfer.


 


(b)                                 Operational
Provisions.  Amounts received in a
trust-to-trust transfer will be allocated to corresponding Accounts under this
Plan.  Amounts that are subject to the
survivor annuity requirements of Code Section 401(a)(11) will be accounted
for separately.  Trust-to-trust
transfers will not be subject to the Limitations on Allocations Appendix to
this Plan.


 


5.06                           Restoration. 
If a Participant was improperly excluded at any time from an allocation,
an amount computed on the same basis as the allocation will be added to that
Participant’s Account, after that amount has been adjusted to reflect
reasonable gain or loss as determined by the Committee.


 


5.07                           Deductibility. 
To the extent that a Participating Company is not allowed a current
deduction under the Code for any contribution made to the Plan, the
Participating Company may, within one year following a final determination of
the disallowance, whether by agreement with the Internal Revenue Service or by
final decision of a court of competent jurisdiction, demand repayment of the
disallowed contribution, and the Trustee shall return the contribution within
one year following the disallowance. 
Earnings of the Plan attributable to such a contribution may not be
returned to the Participating Company, but losses attributable to such a
contribution will reduce the amount returned.


 


5.08                           Mistake of Fact. 
If, within one year of the making of a contribution to the Plan, the
Committee certifies to the Trustee that the contribution was made by a
Participating


 


11

















 


Company under a mistake
of fact, the Trustee will, before the expiration of that year, return the
contribution to the Participating Company.


 


5.09                           Limits.  As more
fully discussed in Appendices to this Plan, Salary Deferral, Matching and
Special Contributions are subject to additional limits.


 


5.10                           Bonus Contribution.  Effective for Plan Years beginning on and after
January 1, 2000, a discretionary Bonus Contribution (as defined in
subsection (b) below) may be made to the Account of a Bonus Eligible
Employee (as defined in subsection (b) below) in an amount to be
determined in the sole discretion of the Company.  The contribution may be made in a specified number of shares of
the common stock of the Company, a specified number of shares of common stock
of the Company per Bonus Eligible Employee or a flat dollar amount. The Bonus
Contribution will be allocated on a per capita basis to the Profit Sharing
Account established for each Bonus Eligible Employee.


 


(a)                                  Liquidation
Restriction.  The provisions of this
subsection (a) are repealed effective March 1, 2002.  As of that date, a Participant may liquidate
any units of the WellPoint Common Stock Fund in his or her Account that are
attributable to a Bonus Contribution at any time, consistent with the Plan’s
standard investment procedures, and reinvest the funds in another investment
fund under the Plan.


 


Prior to
March 1, 2002, the following provisions apply:  To the extent that the Bonus Contribution is
made in the form of shares of the common stock of the Company, any units of the
WellPoint Common Stock Fund in a Participant’s Account that are attributable to
such contribution may not be liquidated and invested in another investment fund
under the Plan before the earliest to occur of (1), (2), or (3) below:


 


(1)                                  The
date that the Participant attains age 55.


 


(2)                                  The
date that the Participant ceases to be a common law Employee of all Affiliated
Companies.


 


(3)                                  Any
date after the last day of the Plan Year in which the Bonus Contribution is
made.


 


Any units acquired due to
a stock dividend or a stock split will be subject to the liquidation
restrictions outlined in this subsection (a).  Any units acquired due to a stock dividend or a stock split will
be considered to have been credited to a Participant’s Account as of the date
that units representing the original shares were credited to that Participant’s
Account.  Cash dividends on WellPoint
Common Stock will not be subject to the liquidation restrictions outlined in
this subsection (a).


 


(b)                                 Definitions.


 


(1)                                  A
“Bonus Contribution” refers to a qualified nonelective employer profit sharing
contribution made at the sole discretion of the Company that is 100% vested
when made and subject to the distribution restrictions applicable to Salary
Deferral Contributions.  Bonus
Contributions may be taken into account to the extent necessary to satisfy the
tests described in the Testing Salary Deferral and Matching Contributions
Appendix to this Plan.


 


12

















 


(2)                                  A
“Bonus Eligible Employee” refers to each Employee of a Participating Company
employed on the effective date of the Bonus Contribution (including any such
Employee on an authorized leave of absence as of such effective date who
returns to employment at the end of the leave), other than a Temporary
Employee, a non-resident alien who receives no earned income from sources
within the United States, an Employee who has not attained age 18 or an
Employee whose terms of employment are governed by a collective bargaining
agreement except to the extent such agreement expressly provides for an
allocation of any Bonus Contribution. 
Notwithstanding the prior sentence, an individual employed by
RightCHOICE Managed Care, Inc. or any of its subsidiaries (collectively,
“RightCHOICE”) on February 28, 2002 will be eligible to receive an
allocation of the Bonus Contribution made as of such date provided the
individual (i) is not categorized as a temporary employee by RightCHOICE and
has not performed 1,000 Hours of Service during any consecutive 12-month
period, (ii) is not a non-resident alien who receives no earned income from
sources within the United States, and (iii) is not less than 18 years of
age.  An individual employed by
RightCHOICE who would otherwise be eligible for an allocation of the Bonus
Contribution, but is on a leave of absence on February 28, 2002, will be
eligible for such an allocation if, and at such time as, he or she returns to
employment with RightCHOICE at the end of the leave.


 


ARTICLE VI


 


INVESTMENT
FUNDS AND WELLPOINT COMMON STOCK


 


6.01                           Individual Direction of Investments.  At the written direction of an officer of
the Company at the level of Senior Vice President or above, the Trustee will
establish separate funds to which Participants may direct the investment of
their Accounts.  Investment in these
funds will be subject to such restrictions and administrative procedures as are
imposed by the Committee, pursuant to its discretionary authority to administer
and interpret the Plan, including, but not limited to, procedures for
investment of amounts for which no investment direction is given by a
Participant.


 


6.02                           WellPoint Common Stock Fund.  At the discretion of the Committee, the Plan
may acquire and hold WellPoint Common Stock. 
Participants may elect to invest amounts held in their Account in units
of a WellPoint Common Stock Fund established by the Trustee pursuant to
Section 6.01 of the Plan subject to such restrictions and administrative
procedures as are imposed by the Committee, pursuant to its discretionary
authority to administer and interpret the Plan.


 


6.03                           Purchase Price. 
All purchases and sales of WellPoint Common Stock by a WellPoint Common
Stock Fund will be effected at the prevailing market price.


 


6.04                           Voting and Tender Offers.


 


(a)                                  Proxy
Votes.  A Participant may direct
voting of the shares of WellPoint Common Stock underlying the Participant’s
interest in a WellPoint Common Stock Fund. 
The Trustee will vote such shares in accordance with the directions of
Participants, as communicated in writing to the Trustee.


 


(i)                                     Notification.  A Participant whose Account is invested in a
WellPoint Common Stock Fund will be notified by the Trustee (or by WellPoint
Health


 


13

















 


Networks Inc.,
pursuant to its normal communications with shareholders) of each occasion for
the exercise of voting rights, within a reasonable time before those voting
rights are to be exercised.  This
notification will include all proxy statements and other information
distributed by WellPoint Health Networks Inc. to shareholders generally,
regarding the exercise of voting rights.


 


(ii)                                  No
Direction.  To the extent that a
Participant fails to direct the Trustee, in whole or in part, as to the
exercise of voting rights with respect to any WellPoint Common Stock underlying
the Participant’s interest in a WellPoint Common Stock Fund, those shares will
be voted by the Trustee proportionately in the same manner as shares as to
which the Trustee has received voting instructions.


 


(b)                                 Right
to Tender.  Subject to (b)(iii)
below, if the Trustee receives a tender offer to buy WellPoint Common Stock
held by the Trustee, a Participant may direct tender of the shares of WellPoint
Common Stock underlying the Participant’s interest in a WellPoint Common Stock
Fund.  The Trustee will tender such
shares in accordance with the directions of Participants, as communicated in
writing to the Trustee.


 


(i)                                     Notification.  All Participants entitled to tender
WellPoint Common Stock held by a WellPoint Common Stock Fund will be so
notified by the Trustee (or by WellPoint Health Networks Inc.) within a
reasonable time before the right to tender is to be exercised.  This notification will include information
received by the Trustee as shareholder, or distributed by WellPoint Health
Networks Inc. to shareholders generally, regarding their right to tender.


 


(ii)                                  No
Direction.  To the extent that a
Participant fails to direct the Trustee, in whole or in part, to tender
WellPoint Common Stock underlying the Participant’s interest in a WellPoint
Common Stock Fund, those shares will not be tendered.


 


(iii)                               Non-Cash Tender.  The Trustee will not permit Participants to direct
the tender of WellPoint Common Stock, to the extent that the receipt or holding
of the property offered in exchange for the shares would violate any applicable
law, including ERISA.  The Committee
will make investment decisions regarding any non-cash property received by a
WellPoint Common Stock Fund as a result of a tender.


 


(c)                                  Deemed
Participant.  For purposes of this
Article VI, the Beneficiary of a deceased Participant will be treated as
though he or she were a Participant.


 


6.05                           Restriction on Liquidation of Units in
a WellPoint Common Stock Fund.  The
provisions of this Section 6.05 are repealed effective March 1,
2002.  As of that date, a Participant
may liquidate any units of the WellPoint Common Stock Fund in his or her
Account that are attributable to a Matching Contribution at any time,
consistent with the Plan’s standard investment procedures, and reinvest the
funds in another investment fund under the Plan.


 


Prior to
March 1, 2002, the following provisions apply:  Once each Plan Year, a Participant may
liquidate any units in a WellPoint Common Stock Fund that were required to be
credited to his or her Account as a Matching Contribution (“Required Units”)
during any prior Plan Year.  In
addition, a Participant may liquidate any or all Required Units upon attaining
age 55 or ceasing to be a common law employee with any Affiliated Company.  Prior to 1999, a Participant may not direct
that Required Units be liquidated and invested in another investment fund under
the Plan until the earliest to occur of (a), (b), or (c) below:


 


14

















 


(a)                                  Two
Years.  The date that is 730 days
after the date that the units to be liquidated were credited to the
Participant’s Account.


 


(b)                                 Age
55.  The date that the Participant
attains age 55.


 


(c)                                  No
Longer an Employee.  The date that
the Participant ceases to be a common law Employee of all Affiliated Companies.


 


Cash dividends on
WellPoint Common Stock will not be subject to the liquidation restrictions
outlined in this Section.  Units
acquired due to a stock dividend or a stock split will be subject to the
liquidation restrictions outlined in this Section to the extent that the
original shares were subject to these restrictions.  For these purposes, units acquired due to a stock dividend or a
stock split will be considered to have been credited to a Participant’s Account
as of the date that units representing the original shares were credited to
that Participant’s Account.


 


6.06                           Responsibility. 
Each Participant is solely responsible for the investment of his or her
Account.  No Plan fiduciary and no
Employee is authorized to advise a Participant regarding such investment.


 


ARTICLE VII


 


VALUATION


 


The value of the Account
of a Participant on any date will be deemed to be the net balance of the
Account on the Valuation Date immediately preceding or coincident with the date
as of which such value is to be determined, adjusted by the Committee, pursuant
to its discretionary authority to administer and interpret the Plan and to
determine eligibility for benefits under the Plan.  Adjustments will include increases due to contributions to the
Account since the relevant Valuation Date; decreases due to Plan expenses,
distributions, loans, or withdrawals paid from the Account since the relevant
Valuation Date; and adjustments for income or loss.


 


ARTICLE VIII


 


VESTING


 


All Plan Accounts are
vested and nonforfeitable.


 


ARTICLE IX


 


IN-SERVICE
WITHDRAWALS


 


Subject to administrative
procedures established by the Committee, and to the provisions governing merged
assets contained in Appendices to this Plan, the following types of in-service
withdrawals are available under the Plan.


 


15

















 


9.01                           Age 59-1/2.  A
Participant may withdraw up to his or her entire Plan Account upon attaining
age 59-1/2.  Only one such withdrawal
will be permitted in any six-month period.


 


9.02                           Rollover Account Withdrawals.  A Participant may withdraw up to the entire
balance from his or her Rollover Account.


 


(a)                                  Permitted
Frequency.  Only one such withdrawal
will be permitted in any six-month period.


 


(b)                                 Two
Year/Five Year Requirement.  The
Participant may only withdraw funds that have been held in the Plan for at
least two full years, provided, however, if the Participant has been credited
with five Years of Service for an Affiliated Company, the two year rule is
inapplicable.  This two year/five year
requirement will be removed from the Plan and Participants will be permitted to
make withdrawals from their Rollover Accounts without regard to their service
or their participation under the Plan, as soon as administratively feasible
after the Internal Revenue Service issues a favorable determination letter with
respect to this Plan document, which favorable determination letter is dated
after June 1, 1997


 


9.03                           Post-Tax Contributions.  The Plan does not provide for post-tax
contributions.  Certain Participants
whose benefits were transferred to this Plan may, however, have a Post-Tax
Contributions Account under this Plan. 
Such a Participant may withdraw up to the entire balance from his or her
Post-Tax Contributions Account at any time. 
Unless otherwise requested by the Participant, pre-1987 contributions
(without earnings) will be distributed from this account before post-1986
contributions (with earnings).


 


9.04                           Hardship Withdrawals.  If a Participant has an immediate and heavy
financial need (as defined below), and has no other resources reasonably
available to meet this need (as defined below), the Participant may request a
hardship withdrawal from his or her Salary Deferral Contributions Account and
Rollover Account.  The amount available
from the Participant’s Salary Deferral Contributions Account does not include
earnings after December 31, 1988. 
For hardship withdrawals made on and after July 1, 2002, the amount
of a hardship withdrawal may not be less than the lesser of (i) $1,000 and (ii)
the sum of the balances in the Participant’s Salary Deferral Contributions
Account (excluding earnings after December 31, 1988) and Rollover Account.


 


(a)                                  Immediate
and Heavy Financial Need.  A
Participant’s request for a hardship withdrawal may not exceed the amount
immediately required (including the amount necessary to pay any federal, state
or local income taxes or penalties reasonably anticipated to result from the
withdrawal) by the Participant to (i) purchase the Participant’s primary
residence (excluding mortgage payments), (ii) pay expenses incurred within 12
months of the hardship withdrawal request by the Participant, the Participant’s
dependents or the Participant’s spouse, or necessary for those persons to
obtain medical care within the meaning of Code Section 213(d), (iii)
prevent eviction from, or foreclosure of a mortgage on, the Participant’s
primary residence, or (iv) pay for post-high school tuition and related
educational fees for the next 12 months for the Participant, the Participant’s
spouse, or the Participant’s dependents.


 


(b)                                 No
Other Resources Reasonably Available. 
A Participant who makes a hardship withdrawal request must represent
that his or her immediate and heavy financial need cannot be relieved (i)
through reimbursement or compensation by insurance or otherwise, (ii) by
reasonable liquidation of the Participant’s assets, to the extent the liquidation


 


16

















 


would not itself cause an
immediate and heavy financial need, (iii) by cessation of Salary Deferral
Contributions to this Plan and any other elective or after-tax contributions to
any other plan maintained by an Affiliated Company, (iv) by other distributions
or nontaxable (at the time of the loan) loans from plans maintained by any
employer, (v) by requesting a withdrawal from his or her Rollover Account or
Post-Tax Contributions in this Plan, or (vi) by borrowing from commercial
sources on reasonable commercial terms. 
For purpose of this Section, the Participant’s assets are deemed to
include those assets of the Participant’s spouse and minor children that are
reasonably available to the Participant.


 


(c)                                  Suspension.  Effective July 1, 2001, any withdrawal
from a Participant’s Salary Deferral Contributions Account will result in a
suspension of the Participant’s right to direct Salary Deferral Contributions
under the Plan and to make pre-tax and post-tax elective contributions under
all other qualified and nonqualified plans maintained by an Affiliated Company
(“Other Elective Contributions”).  The
suspension will continue for a period of 12 months (6 months effective
January 1, 2002) following the effective date of the withdrawal and expire
on the first day of the first payroll period beginning 365 days (183 days
effective January 1, 2002) after the effective date of the
withdrawal.  If, as of January 1,
2002, a Participant’s ability to make pre-tax and post-tax contributions is
suspended as described in this subsection (c), his or her period of
suspension will end on the last day of the six-month period beginning on the
effective date of the withdrawal or January 1, 2002, whichever is later.  The aggregate amount of a Participant’s
Salary Deferral Contributions to this Plan and the Participant’s Other Elective
Contributions in the Plan Year immediately following the Plan Year in which the
hardship withdrawal is made will not exceed the Code Section 402(g) limit
described in Section 5.01 reduced by the amount of his or her Salary
Deferral Contributions made to this Plan and Other Elective Contributions made
in the Plan Year in which the hardship withdrawal is made.


 


9.05                           Form.  Except as
provided in one or more Appendices to this Plan, withdrawals from the Plan will
be made in the form of a single sum cash payment.


 


ARTICLE X


 


LOANS


 


10.01                     Authorization. 
The Committee may direct the Trustee to make a loan to a Participant who
is employed by a Participating Company and, to the extent required under ERISA
or the Code (but only to that extent), to other Participants and to
Beneficiaries (collectively referred to as “Borrowers”) of the Plan.  Loans will be made from a Participant’s
Account and will be limited to the amount specified below.  No loan will be approved unless the
Participant’s spouse (if any) consents to the loan, in writing, no more than 90
days from the loan date except as described in subsections (a) and (b) below.


 


(a)                                  New
General Rule.  Notwithstanding the
foregoing, no spousal consent will be required for loans made on or after
January 1, 1998 unless the Participant has assets in his or her Account
that were transferred from the Cost Care Inc. Savings Plan or from the UniCARE
Financial Corp. Profit Sharing Plan.


 


(b)                                 UniCARE
and Cost Care.  As soon as
administratively feasible after the Internal Revenue Service issues a favorable
determination letter with respect to this Plan


 


17

















 


document, which favorable
determination letter is dated after October 1, 1997, no spousal consent
will be required for loans taken out by Participants with assets in their
Account that were transferred from the Cost Care Inc. Savings Plan or from the
UniCARE Financial Corp. Profit Sharing Plan.


 


10.02                     Amount.  The
amount of any loan will not be less than $1,000.  Immediately after the origination of the loan, the loan may not
exceed 50% of the Borrower’s vested benefits under this Plan.  Furthermore, the amount of any loan, when
added to the outstanding balance of all other loans to the Borrower from this
Plan and the plans of Affiliated Companies, may not exceed the lesser of (a)
one half of the Borrower’s vested benefits under this Plan and the plans of
Affiliated Companies, valued as of each plan’s most recent valuation date; and
(b) $50,000 reduced by the excess, if any, of (i) the Borrower’s highest
outstanding loan balance under this Plan and the plans of Affiliated Companies
during the 12-month period ending on the day before the loan is made; over (ii)
the Borrower’s outstanding loan balance under this Plan and the plans of
Affiliated Companies on the date the loan is made.


 


10.03                     Maximum Number. 
No more than three loans may be outstanding with respect to a Participant’s
Account at any one time.


 


10.04                     Application and Note.  Each loan will be evidenced by the
Borrower’s note, payable to the Trustee, for the loan plus interest.


 


10.05                     Individual Account.  All loans will be investments of the Borrower’s Account.  Costs charged by the Trustee to establish,
process or collect the loan will be charged to the Borrower’s Account.


 


10.06                     Interest. 
Interest will be charged on Plan loans at a formula rate based on
factors considered by commercial entities that make similar loans.  At the discretion of the Committee, the
interest rate will be redetermined as new loans are made.


 


10.07                     Repayment. 
The term of any loan will not exceed 5 years; provided, however, that
the term of a loan to purchase a principal residence for the Borrower may not
exceed 30 years.  Substantially level
amortization of the loan, with payments not less frequently than quarterly,
will be required over the term of the loan. 
The Trustee and the Committee may require that the loan be repaid by
payroll deduction.  Periodic cash
payments may be made when payroll deduction is not possible.


 


10.08                     Default.  If a
Borrower fails to repay a loan within the time prescribed by the Committee, the
Trustee will levy on the Borrower’s Loan Account at such time as the Borrower
is eligible for a distribution or a withdrawal under the Plan.  In addition, in the event of a failure to
repay, the Trustee may exercise every creditor’s right at law or equity
available to the Trustee.


 


10.09                     Guidelines. 
The Committee or its delegate will approve written guidelines for
administration of the Plan’s loan program. 
Loans transferred to this Plan from another plan will remain subject to
the terms and conditions of the other plan’s loan provisions and will count
against the Plan’s three-loan limit.


 


18

















 


ARTICLE XI


 


DISTRIBUTION
OF BENEFITS


 


Subject to administrative
procedures established by the Committee and to the provisions governing merged
assets contained in Appendices to this Plan, the following provisions govern
distributions available under the Plan.


 


11.01                     Date Benefits Become Distributable.  Plan benefits will become distributable when
(a) the Participant separates from service, including but not limited to a
separation due to death, disability or retirement, (b) subject to Code
Section 401(k)(10), if substantially all the assets of a trade or business
are sold to an unrelated corporation, the Participant continues employment with
the unrelated corporation and the Participating Company continues to maintain
this Plan, or (c) subject to Code Section 401(k)(10), if a Participating
Company’s interest in a subsidiary is sold to an unrelated entity and the
Participant continues employment with the subsidiary and the Participating
Company continues to maintain this Plan.


 


11.02                     Date Benefits Will Be Distributed.  Once Plan benefits become distributable,
they will be distributed as soon as administratively practicable after the
Participant has elected to receive a distribution, and in the case of a
Beneficiary, as soon as administratively practicable after the Participant’s
death.  The requirement for consent is
subject to the “Small Account” provisions in Section 11.07 below.  Illiquid assets (if any) will be distributed
as soon as administratively practicable after they become liquid.


 


11.03                     No Election. 
If a Participant, or a Beneficiary, as the case may be, does not
properly elect a distribution, benefits will be distributed pursuant to the
Distribution Provisions Appendix of this Plan. 
In general, those provisions provide that a Participant must receive his
or her benefits under this Plan by the applicable required beginning date
consistent with Code Section 401(a)(9) and related proposed regulations.


 


11.04                     Retroactive Payment.  If the amount of a distribution cannot be
determined by the date payment is required, or it is not possible to make
payment because the Committee cannot locate the Participant or Beneficiary
after making reasonable efforts to do so, a payment retroactive to the date
payment is required may be made no later than 60 days after the earliest date
on which the amount of the payment can be determined under the Plan, or the
date on which the recipient is located.


 


11.05                     Inability to Locate Recipient.  If a Plan benefit remains unpaid for 2 years
from the date it becomes payable because the Committee, exercising due
diligence, cannot locate the recipient, the benefit will be forfeited and used
for other Plan purposes, including reduction of Participating Companies’ Matching
Contributions.  On presentation of an
authenticated claim by the recipient or the recipient’s representative, amounts
forfeited will be restored, without earnings, from forfeitures for the Plan
Year in question or from a contribution made by the appropriate Participating
Company(s), as determined by the Committee.


 


11.06                     Distribution to Minor or Incompetent.  The Committee may direct that distributions
to be paid to a minor or an incompetent person be paid to the legal guardian,
or if none, to a parent of such person, or to a responsible adult with whom the
person maintains residence, or to the custodian for the person under a Uniform
Transfers to Minors Act or Gift to Minors Act, if permitted by the laws of the
state in which the person resides.


 


19

















 


11.07                     Small Account. 
Notwithstanding any provision of this Plan, if the vested portion of a
Participant’s Account on the date the Participant ceases to be an Employee is
$5,000 ($3,500 prior to January 1, 1998) or less, the Participant’s
Account will be distributed to the Participant, or Beneficiary, as the case may
be, as soon as practicable, without the consent of the Participant or the
Participant’s Beneficiary.  For
distributions made prior to January 1, 2001, if the vested portion of the
Participant’s Account on the date the Participant ceased to be an Employee, or
at the time of any earlier distribution or withdrawal, exceeded $5,000 ($3,500
prior to January 1, 1998), no distribution will be made without the
consent of the Participant or the Participant’s Beneficiary, as applicable.


 


11.08                     Form of Distribution.  Except as provided in one or more Appendices
to this Plan, amounts held in a Participant’s Account will be paid in cash as a
total distribution, unless the Participant (or Beneficiary) elects otherwise
pursuant to Section 11.09.  Except
as provided in one or more Appendices to this Plan, distributions will be made
in a single sum payment, in accordance with the above provisions, which satisfy
the Regulations under Code Section 401(a)(9).  In any event, distributions will be made in accordance with the
Regulations, including the minimum distribution and minimum distribution
incidental benefit requirements of Code Section 401(a)(9)(G).


 


11.09                     Distributions from the WellPoint
Common Stock Fund.  When
requesting a distribution under this Article, a Participant (or Beneficiary)
may elect to receive the portion of his or her Account that is invested in a
WellPoint Common Stock Fund in whole shares of WellPoint Common Stock.  Any balance representing fractional shares
will be distributed in cash.


 


11.10                     Direct Rollover.  Notwithstanding any provision of this Plan to the contrary that
would otherwise limit a Distributee’s election under this Plan, a Distributee
may elect, at the time and in the manner prescribed by the Committee, to have
any portion of an Eligible Rollover Distribution paid directly to an Eligible
Retirement Plan specified by the Distributee in a Direct Rollover.  For these purposes, the following
definitions apply:


 


(a)                                  Eligible
Rollover Distribution.  An Eligible
Rollover Distribution is any distribution of all or any portion of the balance
to the credit of the Distributee, except that an Eligible Rollover Distribution
does not include:  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 the
Distributee or the joint lives (or joint life expectancies) of the Distributee
and the Distributee’s designated Beneficiary, or for a specified period of 10
years or more; any distribution to the extent that distribution is required
under Section 401(a)(9) of the Code; effective January 1, 1999,
any hardship distribution described in Code Section 401(k)(2)(B)(i)(IV);
and 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).


 


(b)                                 Eligible
Retirement Plan.  An Eligible Retirement
Plan is 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(a), or a qualified trust
described in Code Section 401(a), that accepts the Distributee’s Eligible
Rollover Distribution.  However, in the
case of an Eligible Rollover Distribution to the surviving spouse, an Eligible
Retirement Plan is an individual retirement account or individual retirement
annuity.


 


20

















 


(c)                                  Distributee.  A Distributee includes an Employee or former
Employee.  In addition, the Employee’s
or former Employee’s surviving spouse and the Employee’s or former Employee’s
spouse or former spouse who is the alternate payee under a Qualified Domestic
Relations Order, as defined in Code Section 414(p), are Distributees with
regard to the interest of the spouse or former spouse.


 


(d)                                 Direct
Rollover.  A Direct Rollover is a
payment by the Plan to the Eligible Retirement Plan specified by the
Distributee.  The Committee or its
delegate may authorize a direct rollover of a Participant note for a Plan loan
to a qualified trust described in Code Section 401(a) or an annuity plan
described in Code Section 403(a).


 


11.11                     General Waiver of 30-Day Requirement.  Notwithstanding anything to the contrary in
this Plan, if a distribution is one to which Sections 401(a)(11) and 417 of the
Code do not apply, that distribution may begin less than 30 days after the
notices required under Regulation 1.411(a)-11(c) and Code Section 402(f)
are given, provided that (1) the Committee clearly informs the recipient that
the recipient has a right to a period of at least 30 days after receiving the
notices to consider the decision of whether or not to elect a distribution
(and, if applicable, a particular distribution option), and (2) the recipient,
after receiving the notices, affirmatively elects a distribution.


 


11.12                     Special Waiver of 30-Day Requirement.  Notwithstanding anything to the contrary in
this Plan, if a distribution is one to which Sections 401(a)(11) and 417 of the
Code apply (including a distribution of assets subject to special provisions
outlined in Appendices to this Plan), that distribution may begin less than 30
days after the notices required under Regulation 1.411(a)-11(c) and Code
Section 402(f) (collectively referred to as “Notices”) are given provided
that:


 


(1)                                  Affirmative
Election.  After having received the
Notices, the recipient affirmatively elects a form of distribution and the
Participant’s spouse consents to that form of distribution (if necessary).


 


(2)                                  Election.  The recipient was informed that he or she
had a right to at least 30 days to consider whether to waive the normal form of
benefit and to consent to an optional form of benefit.


 


(3)                                  Revocation.  The recipient was informed that he or she
could revoke an affirmative distribution election at any time before the
annuity starting date, or, if later, the end of the 7-day period that begins
the day after the Notices were provided to the recipient.


 


(4)                                  Timing.  The Annuity Starting Date (as defined in the
applicable Appendices) is after the date that the Notices were provided to the
recipient.  The Annuity Starting Date
may, however, be before the expiration of the 7-day period referred to in the
next paragraph and before the date of the recipient’s affirmative distribution
election.


 


(5)                                  7-Day
Period.  Distribution in accordance
with a recipient’s affirmative election may not begin before the end of the
7-day period that begins the day after the Notices are provided to the
recipient.


 


21

















 


ARTICLE XII


 


BENEFICIARY
DESIGNATIONS


 


12.01                     All Participants.  Subject to the special distribution provisions contained in Appendices
to this Plan, a Participant may designate one or more primary Beneficiaries and
one or more secondary Beneficiaries to receive any benefit payable from the
Participant’s Account on the Participant’s death.  A Participant’s Beneficiary designation will be made on a form
prepared by, and delivered to, the Committee before the Participant’s
death.  The Participant may revoke or
change this designation at any time before his or her death by delivering a
subsequent form to the Committee.


 


12.02                     Married Participants.  If the Participant is married, and if the
Participant names a Beneficiary other than his or her surviving spouse as a
primary Beneficiary, the Participant’s surviving spouse must waive his or her
right to the Participant’s Account in a document, delivered to the Committee,
that acknowledges the effect of the waiver, that is witnessed by a notary
public, and that satisfies such other requirements as the Committee may
impose.  In the waiver, the Participant’s
surviving spouse must consent to the specific non-spouse Beneficiary(s) named
by the Participant.  The waiver will be
effective only with respect to that spouse. 
If the Participant is legally separated or abandoned and the Participant
has a court order to that effect (and there is no qualified domestic relations
order that provides otherwise), or the surviving spouse cannot be located, then
a waiver need not be filed with the Committee when a married Participant names
a Beneficiary other than his or her spouse. 
Spousal consent will be irrevocable unless the Participant changes his
or her Beneficiary or form of distribution designation;  upon such event, spousal consent will be
deemed to be revoked.


 


12.03                     Ineffective Designation.  If a Participant does not have an effective
Beneficiary designation on file when he or she dies, the Participant’s Account
will be distributed to the Participant’s spouse if then living or, if the
spouse is not then living, to the Participant’s children (in equal shares), or
if no such children are then living, according to the laws of intestate
succession in effect in the State of California on the date of the
Participant’s death.


 


ARTICLE XIII


 


CLAIMS
PROCEDURE


 


If a
Participant or Beneficiary (“Claimant”) believes that he or she is entitled to
a greater benefit under the Plan, the Claimant may submit a signed, written
application to the Committee within 90 days of having been denied such a
greater benefit.  The Claimant will
generally be notified of the approval or denial of this application within 90
days of the date that the Committee receives the application.  If the claim is denied, the notification
will state specific reasons for the denial and the Claimant will have 60 days
to file a signed, written request for a review of the denial with the
Committee.  This request will include
the reasons for requesting a review, facts supporting the request and any other
relevant comments.  The Committee,
operating pursuant to its discretionary authority to administer and interpret the
Plan and to determine eligibility for benefits under the terms of the Plan,
will generally make a final, written determination of the Claimant’s
eligibility for benefits within 60 days of receipt of the request for review.


 


22

















 


ARTICLE XIV


 


ALIENATION
AND QUALIFIED DOMESTIC RELATIONS ORDERS


 


14.01                     Prohibition. 
Plan benefits may not be assigned or alienated and will not be subject
to the claims of creditors.  The Plan
will, however, honor properly executed federal tax levies, executions on federal
tax judgments, Qualified Domestic Relations Orders within the meaning of Code
Section 414(p), a direction to pay third parties pursuant to Regulation
1.401(a)-13(e), certain judgments and settlements within the meaning of Code
Section 401(a)(13)(C) and (D), which are issued after
August 5, 1997; and the provisions of this Plan regarding loans and
distributions to minors and incompetent persons.


 


14.02                     Qualified Domestic Relations Order.  A distribution to an alternate payee
authorized by a Qualified Domestic Relations Order may be made even if the
affected Participant would not be eligible to receive a similar distribution
from the Plan at that time.


 


ARTICLE XV


 


ADMINISTRATION


 


15.01                     Committee.  The Directors of the Company may appoint a Committee to administer
the Plan.  The Committee will hold
office at the pleasure of the Directors and will be a named fiduciary of the
Plan.  To the extent that the Company
does not appoint a Committee, the Company will administer the Plan and will be
a named fiduciary of the Plan.  To the
extent that the Company has not appointed a Committee, the term Committee, as
used in this Article, shall be deemed to refer to the Company.


 


15.02                     Power.  The
Committee has full discretionary authority to administer and interpret the Plan,
including discretionary authority to determine eligibility for participation
and benefits under the Plan, to appoint one or more investment managers, to
construe ambiguous terms under the Plan, to correct errors, and to exercise the
powers listed in this document.  The
Committee may delegate its discretionary authority and such duties and
responsibilities as it deems appropriate to facilitate the day-to-day
administration of the Plan. 
Determinations by the Committee or the Committee’s delegate will be
final and conclusive upon all persons.


 


15.03                     Indemnification.  The Participating Companies will indemnify and hold harmless the
Directors, the members of the Committee, and any Employees who may be deemed
fiduciaries of the Plan within the meaning of ERISA, from and against any and
all liabilities, claims, costs and expenses, including attorneys’ fees, arising
out of an alleged breach in the performance of their fiduciary duties under the
Plan and under ERISA, other than such liabilities, claims, costs and expenses
as may result from the gross negligence or willful misconduct of such
persons.  The Participating Companies
shall have the right, but not the obligation, to conduct the defense of such
persons in any proceeding to which this Section applies.


 


15.04                     Expenses.  All
proper expenses incurred in administering the Plan will be paid by the
Participating Companies if not paid from the trust created to fund the
Plan.  If expenses are initially paid by
a Participating Company, the Participating Company may be reimbursed from the
trust created to fund the Plan. 
Committee members will receive no compensation for their services in
administering the Plan.


 


23

















 


ARTICLE XVI


 


AMENDMENTS


 


16.01                     Directors.  The Directors or a committee appointed by the Directors, by
written action, may amend the Plan (prospectively or retroactively).


 


16.02                     Officers.  Any
officer of the Company at the level of Senior Vice President or above may amend
this Plan to comply with regulatory requirements, to address administrative
concerns, and in any other manner that does not alter the primary character of
the Plan or its eligibility, provided in each case that the amendment does not
have a substantial adverse financial impact on any Participating Company.


 


16.03                     Effect.  Upon
adoption, an amendment will become effective in accordance with its terms.  Except as provided elsewhere in this Plan,
no amendment will (a) cause Plan assets to revert to a Participating Company or
to be used for purposes other than the exclusive benefit of Participants and
Beneficiaries and payment of reasonable expenses, (b) deprive any Participant
of a benefit already accrued, or (c) change the duties or liabilities of a
Trustee without written consent of the Trustee.


 


ARTICLE XVII


 


TERMINATION,
MERGER AND TRANSFER


 


17.01                     Participating Companies.  A Participating Company may, in its sole
discretion, by written action of its board of directors or by a committee
appointed by its board of directors, discontinue contributions to or terminate
the Plan, in whole or in part, at any time with respect to its own Employees
without any liability whatsoever.


 


17.02                     Company.  The Directors reserve the right to terminate the Plan, at any
time, in their sole and absolute discretion by written action or by a written
action of a committee appointed by the Directors.  If the Plan is terminated with respect to all Participating
Companies, the Trustees will pay to each Participant affected by the termination,
or that Participant’s Beneficiary, within a reasonable time, the net value of
the Participant’s Account in accordance with the written directions of the
Committee; provided that, if termination of the Plan does not constitute a
distribution event within the meaning of Code Section 401(k), the
Participants’ Salary Deferral Contributions Accounts shall continue to be held
in trust for subsequent distribution in accordance with the requirements of
Code Section 401(k).


 


17.03                     Determination of Partial Termination.  A partial termination of the Plan will not
be deemed to occur solely by reason of the sale or transfer of all or
substantially all of the assets of a Participating Company, but will be deemed
to occur only if there is a determination, either made or agreed to by the
Committee, or made by the Internal Revenue Service and upheld by a decision of
a court of last resort, that a particular event or transaction constitutes a
partial termination within the meaning of Code Section 411(d)(3)(A).


 


17.04                     Mergers and Transfers.  This Plan (including any outstanding loans)
may be merged or consolidated with another tax-qualified retirement Plan and
assets and liabilities (including any outstanding loans) may be transferred
from this Plan to any other retirement plan


 


24

















 


qualified under
Section 401 of the Code if each Participant is entitled to receive from
this Plan, or from the surviving or transferee plan, immediately after the
merger, consolidation or transfer, a benefit equal to or greater than the
benefit the Participant would have been entitled to receive under this Plan if
this Plan had been terminated immediately before the merger, consolidation or
transfer.


 


ARTICLE XVIII


 


MISCELLANEOUS


 


18.01                     Limitation of Rights.  Participation in this Plan will not give to
any Employee the right to be retained in the employ of an Affiliated Company,
nor any right or interest in this Plan other than as provided in this Plan
document.


 


18.02                     Satisfaction of Claims.  Any payment to a Participant, the Participant’s
legal representative or Beneficiary, in accordance with the terms of this Plan
and the appropriate Trust Agreement, will, to the extent thereof, be in full
satisfaction of all claims such person may have against each Trustee, the
Committee and all Participating Companies, any of whom may require the
recipient, as a condition precedent to such payment, to execute a receipt and
release therefor in such form as shall be determined by the Trustee, the
Committee or a Participating Company, as the case may be.


 


18.03                     Construction. 
Although contributions made by the Participating Companies are not
limited to profits, the Plan is intended to be a profit sharing plan.  The Plan is to be construed and administered
in accordance with ERISA and other pertinent federal laws and in accordance
with the laws of the State of California to the extent not preempted by ERISA;
provided, however, that if any provision is susceptible of more than one
interpretation, such interpretation shall be given thereto as is consistent
with the intent that this Plan and its related trusts be exempt from federal
income tax under Code Sections 401(a) and 501(a), respectively.  The headings and subheadings of this
instrument are inserted for convenience of reference only and are not to be
considered in the construction of this Plan.


 


18.04                     Severability. 
If a provision of this Plan is held by a court of competent jurisdiction
to be invalid or unenforceable, the remaining provisions of the Plan will
remain fully effective.


 


18.05                     Source of Benefits.  All benefits payable under the Plan shall be paid and provided
for solely from the Plan’s related trust, and the Participating Companies
assume no liability or responsibility therefor.


 


IN WITNESS WHEREOF, the
Company has caused this Plan to be executed this 10th day of October, 2003.


 


	
   

  	
  WELLPOINT HEALTH NETWORKS INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. THOMAS VAN
  BERKEM

  	
   

  



 


25

















 


APPENDIX I: TESTING SALARY DEFERRAL


AND
MATCHING CONTRIBUTIONS


 


1.01                           Individual
Limit on Elective Deferrals.


 


(a)                                  Elective
Deferrals.  “Elective Deferrals”
means contributions on behalf of a Participant under a qualified cash
or deferred arrangement described in Code Section 402(e)(3), under a
simplified employee pension plan described in Code Section 408(k)(6), and
under a salary reduction agreement to purchase an annuity contract described in
Code Section 403(b).


 


(b)                                 Distribution.  If the Committee determines that an
individual’s Elective Deferrals under this Plan exceed the amount permitted by
Code Sections 401(a)(30) or 402(g), the excess amount, together with income
earned on the excess amount during the calendar year will be distributed to the
Participant no later than April 15 following the end of the taxable year
in which the excess contribution was made. 
Income will be determined in accordance with any reasonable method used
for allocating income to Participants’ Accounts during the Plan Year.  Income for the period between the end of the
taxable year in which the excess amount was contributed and the date of
distribution will not be distributed.


 


1.02                           Limit
on Salary Deferral Contributions.


 


(a)                                  Definitions.


 


(1)                                  Deferral
Percentage means, for a group of Eligible Employees, the average of the
ratios (calculated separately for each individual) of (i) to (ii) where (i) is
the amount of the Salary Deferral Contributions allocated for the Plan Year to
the individual’s Account, and (ii) is the Remuneration of the individual for
the Plan Year computed only for the portion of the Plan Year during which the
individual was eligible to make Elective Deferrals under this Plan and, at the
option of the Committee or its delegate, elective deferrals under any other
plan that was merged into this Plan. 
The Deferral Percentage for an Eligible Employee who does not elect to
make Salary Deferral Contributions is zero.


 


(2)                                  401(a)(17)
Limit.  With respect to this
Appendix, the Remuneration of any Participant taken into account in any Plan
Year will not exceed the 401(a)(17) Limit in effect for the Plan Year.


 


(b)                                 Deferral
Percentage Test.  Salary Deferral
Contributions must satisfy one of the following tests:


 


(1)                                  125%.  The Deferral Percentage for Highly
Compensated Employees must not be more than 125% of the Deferral Percentage for
Non-Highly Compensated Employees for the prior Plan Year.


 


(2)                                  200%.  The Deferral Percentage for Highly
Compensated Employees must not be more than 2 percentage points greater than
the Deferral Percentage for Non-Highly Compensated Employees for the prior Plan
Year, and the Deferral Percentage for Highly Compensated Employees must not be
more than 200% of the Deferral Percentage for Non-Highly Compensated Employees
for the prior Plan Year.


 


26

















 


(3)                                  Safe
Harbor.  Effective for Plan Years
beginning after December 31, 1998, this test can be satisfied by
satisfying a design-based safe harbor.


 


(c)                                  Deferral
Percentage Test Operational Rules.


 


(1)                                  Aggregated
Plans.  If two or more plans that
include cash or deferred arrangements are considered a single plan for purposes
of Code Section 401(a)(4) or Code Section 410(b) (other than for
purposes of the average benefits test of Code Section 410(b)), the cash or
deferred arrangements included in those plans will be treated as a single
arrangement.


 


(2)                                  Highly
Compensated.  If an eligible Highly
Compensated Employee is a participant under two or more cash or deferred
arrangements of an Affiliated Employer, for purposes of determining that
Employee’s Deferral Percentage, all such cash or deferred arrangements will be
treated as a single cash or deferred arrangement.


 


(3)                                  Disregarded
Employees.  Any Employee who is not,
at any time during the Plan Year, eligible to authorize a Salary Deferral
Contribution will be disregarded.


 


(4)                                  Election.  The Committee or its delegate is authorized
to elect to use the current Plan Year rather than the preceding Plan Year in
performing the Deferral Percentage test consistent with the requirements of IRS
Notice 98-1, as that may be amended by subsequent guidance.


 


(d)                                 Satisfaction
of Deferral Percentage Test.


 


(1)                                  Reduction
of Contributions.  If, at any time,
the Committee determines that the Deferral Percentage test is not likely to be
satisfied, the Committee may reduce the maximum percentage of Compensation that
a Highly Compensated Employee may elect as a Salary Deferral Contribution for
the Plan Year.


 


(2)                                  Recalculation.  If, after the end of the Plan Year, the Plan
does not satisfy the Deferral Percentage test, the Excess Deferral
Contributions, and any income or loss attributable to such amount, will be
distributed to the Highly Compensated Employees, starting with the Highly
Compensated Employee with the greatest dollar amount of Salary Deferral
Contributions and continuing in descending order.


 


(3)                                  Excess
Deferral Contributions.  The amount
of Excess Deferral Contributions to be distributed to Highly Compensated
Employees as described in paragraph (2) above is equal to the excess of (i)
over (ii) where (i) is the amount of Salary Deferral Contributions made on
behalf of all Highly Compensated Employees for the Plan Year in which the
excess arose and (ii) is the maximum amount of Salary Deferral Contributions
that could be made on behalf of Highly Compensated Employees for the Plan Year,
determined by hypothetically reducing each Highly Compensated Employee’s Salary
Deferral Contributions to the extent necessary to satisfy the Deferral
Percentage test, starting with the Highly Compensated Employee with the highest
individual deferral rate.  The
determination will be made after returning any excess Elective Deferrals as
described in Section 1.01.


 


(4)                                  Adjustments.  Distributions of Excess Deferral
Contributions and Excess Contribution Amounts described in Section 1.03
below will be


 


27

















 


adjusted for income and
loss using any reasonable method for allocating income to Participants’
Accounts during the Plan Year.  Income
for the period between the end of the Plan Year and the date of distribution
will not be included.  Federal, state or
local income tax withholding obligations attributable to a distribution may be
satisfied out of the distribution, if not satisfied out of other
compensation.  Unmatched Salary Deferral
Contributions will be distributed before matched Salary Deferral
Contributions.  If matched Salary
Deferral Contributions must also be distributed, they will be accompanied by
the forfeiture of a proportionate share of Matching Contributions.


 


(5)                                  Timing.
Excess Deferral Contributions for a Plan Year will be distributed no later than
the last day of the Plan Year immediately following the Plan Year for which the
contributions were made.


 


1.03                           Limit
on Matching Contributions.


 


(a)                                  Contribution
Percentage Test.  Matching
Contributions are tested and distributed similarly to Salary Deferral
Contributions under Section 1.02 above except (i) the contribution
percentage test described in Code Section 401(m)(2) is substituted for the
Deferral Percentage test and (ii) Excess Contribution Amounts are substituted
for Excess Deferral Contributions. 
Excess Contribution Amounts are equal to the excess of (i) over (ii)
where (i) is the amount of Matching Contributions made on behalf of all Highly
Compensated Employees for the Plan Year in which the excess arose and (ii) is
the maximum amount of such contributions that could be made on behalf of Highly
Compensated Employees for the Plan Year, determined by hypothetically reducing
each Highly Compensated Employee’s Matching Contributions to the extent
necessary to satisfy the contribution percentage test, starting with the Highly
Compensated Employee with the highest individual contribution rate.  The determination is made after returning
any excess Elective Deferrals as described in Section 1.01 and any Excess
Deferral Contributions as described in Section 1.02.


 


(b)                                 Multiple
Use Limitation.  If testing under
Sections 1.02 and 1.03 results in the multiple use of the alternative
limitation (e.g., the percentage for Highly Compensated Employees is not
greater than the Non-highly Compensated Employee percentage for the prior Plan
Year plus 2 points or 200% of the Non-highly Compensated Employee percentage
for the prior Plan Year for both tests), the amount over the aggregate limit
described in Treasury Regulation Section 1.401(m)-2(b)(3) will be treated
as an Excess Deferral Contribution described in Section 1.02 and returned
to Highly Compensated Employees as described therein.


 


1.04                           Records.
The Committee will maintain records sufficient to demonstrate the Plan’s
compliance with Code Sections 401(k)(3) and 401(m).


 


1.05                           Ordering.  If, pursuant to these limits, excess
contributions are required to be distributed, unmatched Salary Deferral
Contributions will be distributed before matched Salary Deferral Contributions.  If matched Salary Deferral Contributions
must also be distributed in order to satisfy these limits, the matched Salary
Deferral Contributions will be accompanied by the distribution of a
proportionate share of Matching Contributions.


 


1.06                           Affiliated
Companies.  All of this Appendix
except Section 1.01 will be administered separately with regard to
Affiliated Companies (if any) that are unrelated within the meaning of Code
Section 414.


 


28

















 


APPENDIX II: LIMITATIONS ON ALLOCATIONS


 


1.01                           Basic
Limitation.  The total Annual
Addition to Participants’ Accounts under this Plan and under any other defined
contribution plan maintained by an Affiliated Company may not, for any
Limitation Year beginning after 1994, exceed the lesser of (i) the dollar limit
which is $30,000 indexed for cost of living changes consistent with Code
Section 415(d) or (ii) 25% of the Participant’s Remuneration for that
Limitation Year.


 


(a)                                  Employer
Contributions.  An amount shall be
an Annual Addition under a defined contribution plan for a Limitation Year if,
with respect to employer contributions (including salary deferral
contributions), such contributions are made during the Limitation Year or no
later than 30 days following the end of the taxable year (including
extensions) with or within which the Limitation Year ends.


 


(b)                                 Participant
Contributions.  An amount shall be
an Annual Addition under a defined contribution plan for a Limitation Year if,
with respect to the Participant’s own contributions, the contributions are made
during the Limitation Year or no later than 30 days following the end of
such Limitation Year.


 


1.02                           Annual
Addition.  “Annual Addition” means,
for any Limitation Year, the aggregate amount (excluding Rollover Contributions
and Trust-to-Trust Transfers) credited to a Participant’s account under this
Plan and to a Participant’s accounts under each other defined contribution plan
of an Affiliated Company with respect to such Limitation Year from employer
contributions and forfeitures allocated to a Participant’s account (excluding
any amount reinstated to an account pursuant to Code Sections 411(a)(7)(C)
(cash-outs) or 411(a)(3)(D) (mandatory contributions), a Participant’s own
contributions made on behalf of the Participant, and contributions to an
individual medical account (as defined in Code Section 415(1)) for a
Participant as part of a defined benefit plan. 
For purposes of the application of the dollar limit of clause (i)
of Section 1.01 of this Appendix to a Participant who is a Key Employee,
as defined in Code Section 416(i), with respect to a Limitation Year, any
amount paid or accrued to that Participant’s account under a welfare benefit
fund pursuant to Code Section 419A(d) is an Annual Addition.


 


The provisions in
subsections (a) through (d) below apply only in Plan Years beginning before
January 1, 2000:


 


(a)                                  Combined
Limit.  If a Participant also
participates in a qualified defined benefit plan maintained by an Affiliated
Company, the sum of (i) the Defined Benefit Fraction and (ii) the
Defined Contribution Fraction (as defined below) shall not exceed 1.0 for any
Limitation Year.


 


(b)                                 Defined
Benefit Fraction means that fraction, the numerator of which is the
Participant’s projected annual benefit, determined as of the close of the
Limitation Year, under all defined benefit plans of all Affiliated Companies
and the denominator of which is the lesser of (i) the product of
1.25 and the dollar limits in effect under Code Section 415(b)(1)(A) for
the Limitation Year or (ii) the product of 1.4 and the Participant’s
average annual Remuneration for the 3 consecutive Limitation Years for which
such average is the highest.  A
Participant’s “projected annual benefit” is the annual benefit to which the
Participant would be entitled under all defined benefit plans of all Affiliated
Companies if the Participant were to remain an Employee until normal retirement
age under each such plan and all other relevant factors used to determine
benefits under such plans were to remain constant.


 


29

















 


(c)                                  Defined
Contribution Fraction means that fraction, the numerator of which is the
sum of the Annual Additions to the Participant’s accounts under each defined
contribution plan maintained by an Affiliated Company for the Limitation Year
and all prior Limitation Years (less the amount, if any, permitted to be
subtracted under (i) the transitional rule of Section 235(g)(3) of
the Tax Equity and Fiscal Responsibility Act of 1982 or (ii) the transitional
rule of Section 1106(h)(4) of the Tax Reform Act of 1986) and the
denominator of which is the lesser of the following amounts with respect
to the Limitation Year and each prior Limitation Year during which the
Participant was an employee of an Affiliated Company:  (1) the product of 1.25 and the dollar limit in effect under
Code Section 415(c)(1)(A) (but without regard to Code
Section 415(c)(6)) for such Limitation Year or (2) the product of 1.4
and 25% of the Participant’s Remuneration for such Limitation Year; provided
that the Committee may calculate the denominator of the Defined Contribution
Fraction for all defined contribution plans of Affiliated Companies using the
alternative method set forth in Code Section 415(e)(6).


 


(d)                                 Top
Heavy Adjustment.  For any Plan Year
that the Plan is Top Heavy (as determined under Appendix III), the definitions
of Defined Contribution Fraction and Defined Benefit Fraction are modified by
substituting 1.0 for 1.25;  provided,
however, in no event, will the accrued benefit or account balance of a
Participant be reduced below the amount of such accrued benefit or account
balance immediately before the Plan became Top Heavy.


 


1.03                           Compliance
with Basic Limitation.             If the
Annual Addition to a Participant’s accounts in this Plan and any other defined
contribution plan of any Affiliated Company would exceed the limits described
in 1.01 of this Appendix, the Annual Addition to this Plan and to each other
defined contribution plan of any Affiliated Company will be reduced but only to
the extent necessary to comply with Section 1.01 of this Appendix, as
follows:


 


(a)                                  Participant
Contributions.  First, the
Participant’s own contributions to each such plan, to the extent that they
constitute an Annual Addition, will be reduced pro rata, and the excess,
together with earnings thereon, returned to the Participant.


 


(b)                                 Employer
Contributions.  Then, employer
contributions for the Limitation Year that have not been allocated to such
participants will be reduced pro rata.


 


(c)                                  Suspense
Account.  Then, amounts that cannot
be allocated to participants’ accounts will be credited to a suspense account
that will be used to reduce future employer contributions.  The suspense account will not share in
investment earnings and no employer contributions may be made while amounts
remain unallocated in the suspense account.


 


1.04                           Compliance
with Combined Limitation.  If for a
Limitation Year beginning before January 1, 2000, the sum of the
Defined Benefit Fraction and the Defined Contribution Fraction would exceed
1.0, then the following actions will be taken in the following order, to the
extent necessary for compliance with Section 1.03 of this Appendix, taking
into account the transition provisions of Section 1106(h)(3) of the Tax
Reform Act of 1986:


 


(a)                                  Defined
Benefit Plan.  The Participant’s
accrued benefits under each defined benefit plan of an Affiliated Company will
be reduced in accordance with the terms of each such plan.


 


(b)                                 Defined
Contribution Plan.  Annual Additions
to the Participant’s accounts in this Plan and each other defined contribution
plan of an Affiliated Company will be reduced.


 


30

















 


(c)                                  Years
after December 31, 1999. 
Notwithstanding the foregoing, the overall limit on annual contributions
made on behalf of an employee who participates in a defined benefit and a
defined contribution plan maintained by the same employer will cease to be in
effect for Limitation Years beginning after December 31, 1999.


 


1.05                           Limitation
Year.  The Limitation Year is the
Plan Year.


 


1.06                           Affiliated
Company.  For purposes of this
Appendix, the determination of an Affiliated Company will be made with the
adjustment required by Code Section 415(h).


 


31

















 


APPENDIX III: TOP HEAVY PROVISIONS


 


The following provisions
apply for purposes of determining whether the Plan is Top Heavy as defined in
Section 1.03 below and in Code Section 416(g).


 


1.01                           Definitions.  For purposes of this Appendix, the following
terms shall have the meaning indicated:


 


(a)                                  Determination
Date shall mean, for the Plan’s first Plan Year, the last day of such Plan
Year, and for any other Plan Year, the last day of the preceding Plan Year.


 


(b)                                 Key
Employee shall mean, with respect to any Plan Year, a Participant or former
Participant (and the Beneficiaries of a deceased Participant) who, at any time
during the Plan Year containing the Determination Date for the Plan Year in
question, or any of the four immediately preceding Plan Years, was:


 


(i)                                     Officer.  An officer, for purposes of this Appendix,
is an officer of an Affiliated Company having annual Remuneration from all
Affiliated Companies for a Plan Year greater than 50% of the maximum dollar
limitation in effect under Code Section 415(b)(1)(A) for the calendar year
in which such Plan Year ended.  The
individuals actually considered as Key Employees by virtue of being officers
(I) shall not in number exceed the lesser of 50 or that number not in
excess of the greater of three officers or 10% of the total number of Employees
of all the Affiliated Companies, and (II) shall be those individuals
belonging to the group of all Participants determined to be officers for the
Plan Year containing the Determination Date or any of the preceding four Plan
Years, who received the highest annual Remuneration for any Plan Year during
such five-year period.


 


(ii)                                  Owners
of Largest Interests.  The owners of
the largest interests are the 10 Employees of any Affiliated Company owning the
largest interests in any Affiliated Company, provided that such Employee owns
more than a 1/2% interest in such Affiliated Company, and that such Employee’s
aggregate annual Remuneration from all the Affiliated Companies exceeds the
maximum dollar limitation under Section 415(c)(1)(A) of the Code.  Should two Employees own the same percentage
interest in one or more Affiliated Companies, then the Employee having the
greater annual Remuneration shall be deemed to own the larger percentage
interest.


 


(iii)                               5%
Owner.  A 5% owner is an individual
who owns more than 5% of the outstanding stock or stock possessing more than 5%
of the total combined voting power of all stock of any Affiliated Company (or,
if the Affiliated Company is not a corporation, more than 5% of the capital or
profits interest of the Affiliated Company).


 


(iv)                              1%
Owner.  A 1% owner is an individual
who owns more than 1% of the outstanding stock or stock possessing more than 1%
of the total combined voting power of all stock of any Affiliated Company, (or,
if such Affiliated Company is not a corporation, more than 1% of the capital or
profits interest of the Affiliated Company), and whose annual Remuneration from
all the Affiliated Companies exceeds $150,000.


 


For purposes of
determining ownership in an Affiliated Company under this subsection, the
attribution principles of Code Section 318 shall apply by substituting
“5%” for “50%” in Section 318(a)(2)(C).


 


32

















 


(c)                                  Non-Key
Employee shall mean, with respect to any Plan Year, any Employee who is not
a Key Employee, including Employees who are former Key Employees.


 


(d)                                 Top
Heavy Ratio of a plan or group of plans shall be a fraction, the numerator
of which is the sum of (I) account balances of all Key Employees under
each defined contribution plan (including any simplified employee pension plan)
included in the determination and (II) the present value of cumulative
accrued benefits of all Key Employees under each defined benefit plan included
in the determination, and the denominator of which is the sum of the account
balances for all Participants under each defined contribution plan (including
any simplified employee pension plan) included in the determination and the
present value of cumulative accrued benefits for all Participants under each
defined benefit plan included in the determination.  In determining the Top-Heavy Ratio, the following rules apply:


 


(i)                                     Valuation.  The value of account balances shall be
determined as of the most recent Valuation Date that falls within or ends
within the 12-month period ending on the Determination Date.  Present value of accrued benefits under a
defined benefit plan shall be calculated under the method used for accrual
purposes in all defined benefit plans of the Affiliated Companies, or, if there
is no such method, as if such benefit accrued not more rapidly than the slowest
accrual rate permitted under Code Section 411(b)(1)(C).  Account balances and accrued benefits so
determined shall be adjusted for the amount of any contributions (I) made
after the date of such valuation but on or before the Determination Date or
(II) due but unpaid as of the Determination Date, and, except as otherwise
provided in (2) or (3) below, shall include any amount distributed during
the five-year period ending on the Determination Date.


 


(ii)                                  Transfers.  With respect to a transfer from one
qualified plan to another (by rollover or Trust-to-Trust transfer) which is
(A) incident to a merger or consolidation of two or more plans or a
division of a single plan into two or more plans, (B) made between two
plans maintained by the same employer or by employers required to be aggregated
under Section 414(b), (c), (m) or (o) of the Code, or (C) otherwise
not initiated by the Employee, a Participant’s accrued benefit or account
balance under a plan shall include any amount attributable to any such transfer
received or accepted by such plan on or before the Determination Date but shall
not include any amount transferred by such plan to any other plan in such a
transfer on or before the Determination Date. 
With respect to any rollover or Trust-to-Trust transfer not described in
the preceding sentence, a Participant’s accrued benefit or account balance
under a plan (I) shall include any amount distributed or transferred by
such plan, unless the distributed or transferred amount is excludable under
paragraph (1), and (II) shall not include any amount attributable to
assets received by such plan.


 


(iii)                               Exclusions.  No accrued benefit for any Participant or
Beneficiary shall be taken into account for purposes of calculating the
Top-Heavy Ratio with respect to (I) a Participant who is not a Key
Employee with respect to the Plan Year in question, but who was a Key Employee
with respect to a prior Plan Year, or (II) an Employee who has performed
no services for any Affiliated Company within the five-year period ending with
the Determination Date, unless such Employee becomes re-employed after such
5-year period.


 


(e)                                  Required
Aggregation Group means a group of two or more plans (including terminated
plans) consisting of (1) a qualified plan of an Affiliated Company
(including a simplified employee pension plan) in which at least one Key
Employee participates, and (2) any other qualified plan or plans of the
Affiliated Company which enable the plan


 


33

















 


described in (1) to meet
the requirements of Code Sections 401(a)(4) and 410 (except Average
Benefits).


 


(f)                                    Permissive
Aggregation Group means a group of plans consisting of a Required Aggregation
Group of plans plus one or more other plan or plans of an Affiliated Company
which, when considered as a group with the Required Aggregation Group, would
continue to satisfy the requirements of Code Sections 401(a)(4) and 410.


 


1.02                           Top-Heavy
Status.  This Plan shall be
considered “Top-Heavy” with respect to any Plan Year if, as of the
Determination Date for such Plan Year, either:


 


(a)                                  No
Required Aggregation.  The Top-Heavy
Ratio for this Plan exceeds 60% and this Plan is not part of any Required
Aggregation Group, or


 


(b)                                 Required
Aggregation.  This Plan is part of a
Required Aggregation Group of plans and the Top-Heavy Ratio for the group of
plans exceeds 60%; provided that, if this Plan is part of one or more
Permissive Aggregation Groups of plans for which the Top-Heavy Ratio does not
exceed 60%, this Plan shall not be Top-Heavy.


 


1.03                           Minimum
Contribution.


 


(a)                                  Recipients.  With respect to any Plan Year for which the
Plan is Top-Heavy, each Participant who is not a Key Employee, and who has not
ceased to be an Employee prior to the end of such Plan Year, shall be entitled
to a contribution under this section. 
No Participant otherwise entitled to an allocation under this
subsection shall be ineligible for such allocation solely because he or she
has not completed 1,000 Hours of Service for the Plan Year.


 


(b)                                 Amounts.  The benefit of each Participant who meets
the requirements of subsection (a), and who does not participate in any
defined benefit plan of any Affiliated Company, shall be such Participant’s
Company Contribution (including forfeitures) under the other provisions of the
Plan; provided that the total employer contribution (including forfeitures)
allocated to the Account of such Participant shall be not less than an amount
which, when added to such Participant’s allocable share of employer
contributions and forfeitures under any other defined contribution plan of any
of the Affiliated Companies, equals at least 3% of his or her
Remuneration.  The benefit described in
this subsection (b) is subject to the following:


 


(i)                                     Limit.  In the event that the percentage of employer
contributions and forfeitures under the plans in which such Participant
participates for the Plan Year on behalf of the Key Employee for whom such
percentage is greatest is less than 3% of such Key Employee’s Remuneration for
the Plan Year, then such Participant shall not be entitled to a contribution
under this subsection (b) for the Plan Year in excess of such percentage
of such Participant’s Remuneration, unless this Plan enables a defined benefit
plan included in a Required Aggregation Group with this Plan to satisfy the
requirements of Section 401(a) or 410 of the Code (except the average
benefits test).


 


(ii)                                  Salary
Reduction.  Notwithstanding the
preceding paragraph, if the highest rate allocated to a Key Employee is less
than 3%, amounts contributed as a result of a salary reduction agreement will
be included when determining contributions made on behalf of Key Employees.


 


34

















 


(iii)                               Adjustment.  If a Participant also participates in a
defined benefit plan of an Affiliated Company, and the Plan and the defined
benefit plan are Top Heavy in a Plan Year, then the minimum contribution
requirement of this Section for that Participant will be fulfilled in
accordance with this subsection, except that “5%” will be substituted for “3%.”


 


1.04                           Affiliated
Companies.  This Appendix will be
administered separately with regard to Affiliated Companies (if any) that are
unrelated within the meaning of Code Section 414.


 


35

















 


APPENDIX IV:  PARTICIPATION
OF UNICARE FINANCIAL CORP. EMPLOYEES


 


Effective for
Compensation paid to Employees of UniCARE Financial Corp. (“UniCARE”) on and
after March 25, 1994, and subject to the terms and conditions outlined
below, UniCARE will become a Participating Company under this Plan.


 


1.01                           Eligibility.  Effective March 25, 1994,
notwithstanding anything to the contrary in this Plan, Employees of UniCARE who
are actively at work with UniCARE on March 25, 1994 and who were
participants in the UniCARE Financial Corp. Profit Sharing Plan (“UniCARE
Plan”) for the payroll period ending February 28, 1994 will be eligible to
participate in this Plan.


 


1.02                           Service.  Effective March 25, 1994,
notwithstanding anything to the contrary in this Plan, hours of service with
UniCARE were treated as Hours of Service with the Company for all purposes
under the Plan including, but not limited to, determinations regarding eligibility
to participate in the Plan and determinations regarding a Participant’s level
of Matching Contributions (if any) under the Plan.


 


1.03                           Plan
Merger.  On June 1, 1994, the
UniCARE Plan, which contains certain annuity and installment options that are
generally unavailable under the terms of this Plan, was merged into this
Plan.  This Appendix is designed to
preserve withdrawal, distribution, and restoration of forfeiture provisions
contained in the UniCARE Plan to the extent required by the Retirement Equity
Act and by Code Section 411 for distributions that are made or begin prior
to the Change Date described in Section 1.08.  Consequently, this appendix is applicable only to assets
(adjusted for future gains losses, expenses and restorations of forfeitures)
transferred to this Plan from the UniCARE Plan (“UniCARE Amount”).  All references to a Participant’s UniCARE
Amount in this Appendix are to that Participant’s UniCARE Amount as of the most
recent Valuation Date.


 


1.04                           UniCARE
Distribution and Withdrawal Options. 
A Participant may elect to receive a withdrawal or a distribution (as
the case may be) of his or her UniCARE Amount as provided in (a), (b), or (c)
immediately below, subject to the restrictions that apply on and after the
Change Date described in Section 1.08.


 


(a)                                  General
Plan Provisions.  A Participant may
elect to receive his or her UniCARE Amount pursuant to the withdrawal or the
distribution provisions generally applicable to assets held under the
Plan.  The installment and annuity
options described in subsections (b) and (c) are not available for
distributions made on and after the Change Date described in Section 1.08.


 


(b)                                 Installment
Distribution.  A Participant may
elect to receive his or her UniCARE Amount in substantially equal annual, or
more frequent installments over a period certain which does not extend beyond
the life expectancy of the Participant or the joint life expectancies of the
Participant and the Participant’s Beneficiary. 
For these purposes, life expectancies will not be recalculated.


 


(c)                                  Annuity
Option.  A Participant may elect to
have his or her UniCARE Amount used to purchase a nontransferable annuity
contract that will be distributed to the Participant in full satisfaction of
all Plan obligations to the Participant and the Participant’s Beneficiaries
with regard to the Participant’s UniCARE Amount.  A Participant who makes such


 


36

















 


an election will be subject to the Notice and Waiver Provisions
contained in Section 5.05 of this Appendix and to the following additional
requirements.


 


(i)                                     Normal
Form.  If the Participant is not
married on his or her Annuity Starting Date, the Participant’s Normal Form will
be a single life annuity.  If the
Participant is married on his or her Annuity Starting Date, the Participant’s
Normal Form will be an immediate annuity for the life of the Participant with a
survivor annuity for the life of the Participant’s spouse (determined as of the
date of distribution of the contract) which is 50% of the amount of the annuity
which is payable during the joint lives of the Participant and the
Participant’s spouse.


 


(ii)                                  Alternate
Form.  Subject to the requirements
of Code Section 401(a)(9), a Participant may elect to receive an immediate
annuity for his or her life or a reduced immediate annuity for his or her life
with a survivor annuity for the life of a Beneficiary that is 50% or 100% of
the amount of the annuity that is payable during the joint lives of the
Participant and the Beneficiary.  An
alternate form of annuity may also provide for an annuity certain feature for a
period not exceeding the life expectancy of the Participant.


 


1.05                           Notice
and Waiver Provisions.  Subject to
the “Special Waiver of 30-Day Requirement” rules in Article XI of this
Plan, the following provisions are applicable to distributions and withdrawals
described in Section 1.04(c) and Section 1.06(a) of this Appendix.


 


(a)                                  Notice.  No less than 30 days and no more than 90
days before the Annuity Starting Date, the Committee will provide the
Participant, or the Participant’s surviving spouse, as the case may be, with a
written explanation of the terms and conditions of the Normal Form, the right
to make, and the effect of, an election to waive the Normal Form, the right of the
Participant’s spouse (if any) to approve a Participant’s waiver, the right to
revoke a waiver and the effect of revoking a waiver.


 


(b)                                 Procedure.  A waiver must be made on a form prepared by,
and delivered to, the Committee no earlier than 90 days before the Annuity
Starting Date.  The Participant, or the
Participant’s surviving spouse, as the case may be, may revoke or change a
waiver at any time before the Annuity Starting Date by delivering a subsequent
form to the Committee that satisfies the Plan’s waiver procedures.


 


(c)                                  Additional
Conditions Applicable to Married Participants.


 


(i)                                     A
Participant’s spouse must waive any rights to the Participant’s Normal Form in
a document prepared by and delivered to the Committee, that acknowledges the
effect of the waiver, and that is witnessed by a notary public.  In the waiver, the Participant’s spouse must
either consent to the specific non-spouse Beneficiary or Beneficiaries named by
the Participant, and the optional form of benefit selected by the Participant,
or acknowledge that the surviving spouse had the right to limit consent only to
a specific non-spouse Beneficiary or Beneficiaries, and to a specific optional
form of benefit, and that the surviving spouse voluntarily elected to
relinquish that right.


 


(ii)                                  Consent
Unnecessary.  If the Participant is
legally separated or abandoned (within the meaning of local law) and the
Participant has a court order to that effect (and there are no Qualified
Domestic Relations Orders as defined in Code Section 414(p) that provide
otherwise), or the spouse cannot be located, then the waiver described in the


 


37

















 


preceding paragraph need not be filed with the Committee when a married
Participant elects an optional form of benefit.


 


(iii)                               Effect
of Consent.  Any waiver by a spouse
obtained pursuant to these procedures (or establishment that the consent of a
spouse could not be obtained) is effective only with respect to that spouse.


 


1.06                           Death
Benefits.  Subject to the requirements
of Code Section 401(a)(9), the following death benefit provisions apply to
UniCARE Amounts, provided, however, the annuity option described in
subsection (a) will not be available for distributions beginning on or
after the Change Date.


 


(a)                                  Married
Participant Who Elected an Annuity. 
If a married Participant properly elects an annuity pursuant to the
terms of this Appendix and dies before his or her Annuity Starting Date, the
Participant’s UniCARE Amount will be used to purchase a single life annuity
(the Normal Form) for the Participant’s surviving spouse as soon as
administratively possible after the Participant’s spouse requests purchase of
such an annuity.  Pursuant to the Notice
provisions of Sections 5.05(a) and (b) of this Appendix, the Participant’s
surviving spouse may elect to receive the Participant’s UniCARE Amount pursuant
to the distribution provisions generally applicable to assets held under the
Plan instead of in the Normal Form of a single life annuity.


 


(b)                                 Unmarried
Participant.  If an unmarried
Participant dies before his or her Annuity Starting Date, the Participant’s
UniCARE Amount will be distributed pursuant to the distribution provisions
generally applicable to assets held under the Plan and neither the annuity nor
the installment provisions of this Appendix will not apply.


 


(c)                                  Married
Participant Who Did Not Elect an Annuity Before the Change Date.  If a married Participant who did not
properly elect an annuity pursuant to the terms of this Appendix dies before
his or her Annuity Starting Date, or the Participant dies on or after the
Change Date, the Participant’s UniCARE Amount will be distributed pursuant to
the distribution provisions generally applicable to assets held under the Plan
and neither the annuity nor the installment provisions of this Appendix will
apply.


 


1.07                           Restoration
of Forfeitures.  Under the UniCARE
Plan, an individual who separated from service with UniCARE and who received a
distribution (or a deemed distribution) of the vested portion of his or her account
under the UniCARE Plan forfeited (or was deemed to forfeit) his or her unvested
benefits under the UniCARE Plan.


 


(a)                                  Return
to Service.  If such an individual
(i) was reemployed by UniCARE or (ii) became an Employee after January 20,
1994 (when UniCARE became a wholly owned subsidiary of WellPoint Health
Networks Inc.), the amount forfeited will be restored (without earnings) as
part of the individual’s UniCARE Amount if the individual pays to this Plan (or
in the case of a deemed forfeiture, the Participant is deemed to have repaid
the Plan) the full amount of the distribution before the earlier of (x) 5 years
after the applicable event described in (i) or (ii) above, or (y) the close of
the first period of 5 consecutive 1-year breaks in service (as defined in the
UniCARE Plan) following the date of the distribution.


 


(b)                                 Funds.  Funds for restoring forfeitures under this
Section will be drawn from a special contribution to the Plan to be made
by the appropriate Participating


 


38

















 


Company, as determined by the Committee.  This special contribution will not be subject to the limitations
under Internal Revenue Code Section 415.


 


1.08                           Change
Date.  For purposes of this Appendix
IV, Change Date means July 1, 2001, provided that each affected
Participant is furnished a summary of material modifications that reflects the
elimination of the annuity and installment distribution options as applied to
UniCARE Amounts not less than 90 days prior to such date.


 


39

















 


APPENDIX V:  PARTICIPATION
OF COST CARE INC. EMPLOYEES


 


1.01                           Eligibility.  Effective March 1, 1997, individuals
who were employed by Cost Care, Inc. (“Cost Care”) on February 28, 1997,
and who became Employees due to a corporate transaction on March 1, 1997
will be eligible to participate in this Plan to the extent they satisfy the
Plan’s eligibility requirements, taking into account the applicable service
crediting provisions in Article III of the Plan.


 


1.02                           Plan
Merger.  Effective March 31,
1997, the Cost Care Inc. Savings Plan (“Cost Care Plan”), under which certain
annuity options were the normal form of benefit, was merged into this
Plan.  The following provisions are
applicable only to assets (adjusted for future gains, losses, expenses and
restorations of forfeitures) merged into this Plan from the Cost Care Plan
(“Cost Care Amount”).  All references to
a Participant’s Cost Care Amount in this Appendix are to that Participant’s
Cost Care Amount as of the most recent Valuation Date.


 


1.03                           Cost
Care Distribution and Withdrawal Options.


 


(a)                                  General
Plan Provisions.  A Participant may
elect to receive his or her Cost Care Amount pursuant to the in-service
withdrawal provisions or the distribution provisions generally applicable to
assets held under this Plan.  For
distributions that begin prior to the Change Date described in
Section 1.07, a Participant may also elect among the annuity options
described below.


 


(b)                                 Annuity
Options.  When requesting an in-service
withdrawal or a distribution, a Participant may elect to have his or her Cost
Care Amount used to purchase a nontransferable annuity contract that will be
distributed to the Participant in full satisfaction of all Plan obligations to
the Participant and the Participant’s Beneficiaries with regard to the
Participant’s Cost Care Amount.  A
Participant who makes such an election will be subject to the Notice and Waiver
Provisions contained in Section 1.04 of this Appendix and to the following
additional provisions.


 


(i)                                     Normal
Form.  If the Participant is not
married on his or her Annuity Starting Date, the Participant’s Normal Form will
become a single life annuity.  If the
Participant is married on his or her Annuity Starting Date, the Participant’s
Normal Form will become an immediate annuity for the life of the Participant
with a survivor annuity for the life of the Participant’s spouse (determined as
of the date of distribution of the contract) which is 50% of the amount of the
annuity which is payable during the joint lives of the Participant and the
Participant’s spouse.


 


(ii)                                  Alternate
Forms.  Subject to the requirements
of Code Section 401(a)(9), a Participant may elect to receive an immediate
annuity for his or her life or a reduced immediate annuity for his or her life
with a survivor annuity for the life of a Beneficiary that is 50% or 100% of
the amount of the annuity that is payable during the joint lives of the
Participant and a Beneficiary.  An
alternate form of annuity may also provide for an annuity payable for the
Participant’s lifetime with a minimum guarantee of 10 years of payments.


 


1.04                           Notice
and Waiver Provisions.  Subject to
the “Special Waiver of 30-Day Requirement” rules in Article XI of this
Plan, the following provisions are applicable to distributions and withdrawals
described in Section 1.03(b) and Section 1.05(a) of this Appendix.


 


40

















 


(a)                                  Notice.  No less than 30 days and no more than 90
days before the Annuity Starting Date, the Committee will provide the
Participant, or the Participant’s surviving spouse, as the case may be, with an
explanation of the terms and conditions of the Normal Form, the right to make,
and the effect of, an election to waive the Normal Form, the right of the
Participant’s spouse (if any) to approve a Participant’s waiver, the right to
revoke a waiver and the effect of revoking a waiver.


 


(b)                                 Procedure.  A waiver must be made on a form prepared by,
and delivered to, the Committee no earlier than 90 days before the Annuity
Starting Date.  The Participant, or the
Participant’s surviving spouse, as the case may be, may revoke or change a
waiver at any time before the Annuity Starting Date by delivering a subsequent
form to the Committee that satisfies the Plan’s waiver procedures.


 


(c)                                  Additional
Conditions Applicable to Married Participants.


 


(i)                                     A
Participant’s spouse must waive any rights to the Participant’s Normal Form in
a document prepared by and delivered to the Committee, that acknowledges the
effect of the waiver, and that is witnessed by a notary public.  In the waiver, the Participant’s spouse must
either consent to the specific non-spouse Beneficiary or Beneficiaries named by
the Participant, and the optional form of benefit selected by the Participant,
or acknowledge that the surviving spouse had the right to limit consent only to
a specific non-spouse Beneficiary or Beneficiaries, and to a specific optional
form of benefit, and that the surviving spouse voluntarily elected to
relinquish that right.


 


(ii)                                  Consent
Unnecessary.  If the Participant is
legally separated or abandoned (within the meaning of local law) and the
Participant has a court order to that effect (and there are no Qualified
Domestic Relations Orders as defined in Code Section 414(p) that provide
otherwise), or the spouse cannot be located, then the waiver described in the
preceding paragraph need not be filed with the Committee when a married
Participant elects an optional form of benefit.


 


(iii)                               Effect
of Consent.  Any waiver by a spouse
obtained pursuant to these procedures (or establishment that the consent of a
spouse could not be obtained) is effective only with respect to that spouse.


 


1.05                           Death
Benefits.  Subject to the
requirements of Code Section 401(a)(9), the following death benefit
provisions apply to Cost Care Amounts, provided, however, the annuity option
described in subsection (a) will not be available for distributions
beginning on or after the Change Date described in Section 5.07.


 


(a)                                  Married
Participant Who Elected an Annuity. 
If a married Participant properly elects an annuity pursuant to the
terms of this Appendix and dies before his or her Annuity Starting Date, the
Participant’s Cost Care Amount will be used to purchase a single life annuity
(the Normal Form) for the Participant’s surviving spouse as soon as
administratively possible after the Participant’s spouse requests purchase of
such an annuity.  Pursuant to the Notice
provisions of Sections 1.04(a) and (b) of this Appendix, the Participant’s
surviving spouse may elect to receive the Participant’s Cost Care Amount
pursuant to the distribution provisions generally applicable to assets held
under the Plan instead of in the Normal Form of a single life annuity.


 


41

















 


(b)                                 Unmarried
Participant.  If an unmarried
Participant dies before his or her Annuity Starting Date, the Participant’s
Cost Care Amount will be distributed pursuant to the distribution provisions
generally applicable to assets held under the Plan and the annuity provisions
of this Appendix will not apply.


 


(c)                                  Married
Participant Who Did Not Elect an Annuity Before the Change Date.  If a married Participant who did not
properly elect an annuity pursuant to the terms of this Appendix dies before
his or her Annuity Starting Date, or if the Participant dies on or after the
Change Date described in Section 5.07 , the Participant’s Cost Care Amount
will be distributed pursuant to the distribution provisions generally
applicable to assets held under the Plan and the annuity provisions of this
Appendix will not apply.


 


1.06                           Restoration
of Forfeitures.  Under the Cost Care
Plan, an individual who separated from service with Cost Care and who received
a distribution (or a deemed distribution) of the vested portion of his or her
account under the Cost Care Plan forfeited (or was deemed to forfeit) his or
her unvested benefits under the Cost Care Plan.


 


(a)                                  Return
to Service.  If such an individual
(i) was reemployed by Cost Care or (ii) became an Employee after March 1,
1997, the amount forfeited will be restored (without earnings) as part of the
individual’s Cost Care Amount if the individual pays to this Plan (or in the
case of a deemed forfeiture, the Participant is deemed to have repaid the Plan)
the full amount of the distribution before the earlier of (x) 5 years after the
applicable event described in (i) or (ii) above, or (y) the close of the first
period of 5 consecutive 1-year breaks in service (as defined in the Cost Care
Plan) following the date of the distribution.


 


(b)                                 Funds.  Funds for restoring forfeitures under this
Section will be drawn from a special contribution to the Plan to be made
by the appropriate Participating Company, as determined by the Committee.  This special contribution will not be
subject to the limitations under Internal Revenue Code Section 415.


 


1.07                           Change
Date.  For purposes of this Appendix
V, Change Date means July 1, 2001, provided that each affected
Participant is furnished a summary of material modifications that reflects the
elimination of the annuity and installment distribution options as applied to
Cost Care Amounts not less than 90 days prior to such date.


 


42

















 


APPENDIX VI:  PARTICIPATION
OF JOHN HANCOCK

MUTUAL LIFE INSURANCE EMPLOYEES


 


1.01                           Eligibility.  Effective March 1, 1997, individuals
who were employed by John Hancock Mutual Life Insurance Company (“Hancock”) on
February 28, 1997, and who became Employees due to a corporate transaction
on March 1, 1997 will be eligible to participate in this Plan to the
extent they satisfy the Plan’s eligibility requirements, taking into account
the applicable service crediting provisions in Article III of the Plan.


 


1.02                           Plan
Merger.  On March 31, 1997, The
Investment-Incentive Plan for Hancock Employees (“Hancock Plan”), which
contains a partial distribution option that is not generally available under
the terms of this Plan, was merged into this Plan.  Consequently, the partial distribution option described below
applies only to assets (adjusted for future gains losses, and expenses)
transferred to this Plan from the Hancock Plan (“Hancock Amount”).  All references to a Participant’s Hancock
Amount are to that Participant’s Hancock Amount as of the most recent Valuation
Date.


 


1.03                           Hancock
Distribution and Withdrawal Options.


 


(a)                                  General
Plan Provisions.  A Participant or a
Beneficiary (as the case may be) may elect to receive his or her Hancock Amount
pursuant to the withdrawal or the distribution provisions generally applicable
to assets held under the Plan.


 


(b)                                 Partial
Distributions.  Subject to the
requirements of Code Section 401(a)(9), a Participant who has attained age
59-1/2 or who is otherwise eligible for a Plan distribution that is not an
in-service withdrawal, an Alternate Payee of such a Participant, or a
Beneficiary who is the surviving spouse of such a Participant, may elect to
receive all or a portion of such a Participant’s Hancock Amount at any time.


 


43

















 


APPENDIX VII:  PARTICIPATING
COMPANIES


 


The following entities
are Participating Companies in this Plan as of March 1, 2002:


 


Blue
Cross of California


 


Blue
Cross and Blue Shield of Georgia, Inc.


 


Comprehensive
Integrated Marketing Services


 


Cost
Care, Inc.


 


Greater
Georgia Life Insurance Company


 


Precision
Rx, Inc.


 


Professional
Claim Services, Inc.


 


UNICARE
Life & Health Insurance Company


 


UNICARE
Health Plans of the Midwest


 


WellPoint
Development Company, Inc.


 


44

















 


APPENDIX VIII:  DISTRIBUTION
PROVISIONS


 


The information contained
in this Appendix is consistent with the Plan’s distribution provisions, and is
generally required by law to be explicitly stated in the Plan.


 


1.01                           Incorporation
by Reference of 401(a)(9) Regulations. 
Effective January 1, 1985, distributions will be made in accordance
with the Regulations under Code Section 401(a)(9), including the minimum
distribution incidental benefit requirement of Code Section 401(a)(9)(G).


 


1.02                           Required
Beginning Date.  Notwithstanding
anything contrary in the Plan, a Participant may not defer payment of Plan
benefits past his or her required beginning date.  If a Participant attains age 70-1/2 before
January 1, 2000, or if the Participant is a 5% owner (within the meaning
of Code Section 416(i)), his or her required beginning date is
April 1 following the close of the calendar year in which the Participant
attains age 70-1/2.  If a Participant
who is not a 5% owner attains age 70-1/2 on or after January 1, 2000,
his or her required beginning date is April 1 of the later of (i) the
calendar year following the calendar year in which the Participant attains age
70-1/2, or (ii) the calendar year following the calendar year in which
Participant terminates employment.


 


1.03                           Form.  Except with respect to a UniCARE Amount,
Cost Care Amount or NCPPO Amount subject to an annuity or installment election,
a Participant’s Plan benefits will be distributed in a single sum at the
Participant’s required beginning date if the Participant has not made a prior
valid election to receive his or her benefits at an earlier distribution
date.  If the Participant’s required
beginning date occurs prior to his or her termination of employment, any
benefits accrued during the Plan Year in which his or her required beginning
date occurs, or any later year, will be distributed to the Participant no later
than last day of the following calendar year.


 


Any
UniCARE Amounts, Cost Care Amounts or NCPPO Amounts subject to an annuity or
installment election will be distributed to the Participant in the annuity
contract form described in the applicable Appendix unless the Participant makes
a valid election to receive an alternative form under the required procedures,
provided, however, that the annual payment under any form must be not less than
the 401(a)(9) amount described below.


 


1.04                           401(a)(9)
Amount for Participants.  The
minimum required distribution for each calendar year (“401(a)(9) amount”),
starting with the calendar year preceding the calendar year in which the
Participant’s required beginning date occurs, is determined by dividing the
Participant’s Account, valued at the last day of the year, by the remaining
life expectancy of the Participant.  The
life expectancy will not be recalculated. 
A new Annuity Starting Date will apply upon the occurrence of a standard
distribution event under the Plan (e.g., the Participant’s termination
of employment or the termination of the Plan), and the Participant’s subsequent
Plan benefits will be redetermined to reflect prior benefit payments.


 


1.05                           Beneficiary
Distributions.


 


(a)                                  Death
Before Required Beginning Date.  If
the Participant dies before his or her required beginning date, distribution of
the Participant’s entire Account, other than any UniCARE Amount, Cost Care
Amount and NCPPO Amount subject to an annuity or installment option will be
completed by December 31 of the calendar year containing the fifth
anniversary of the Participant’s death. 
With respect to any UniCARE Amount, Cost Care


 


45

















 


Amount and NCPPO Amount subject to an annuity or installment option,
distribution shall be made consistent with the preceding sentence except to the
extent that the Beneficiary makes an election in accordance with the following
paragraphs:


 


(i)                                     Designated
Beneficiary.  If any portion of the
Participant’s UniCARE Amount, Cost Care Amount and NCPPO Amount that is subject
to an annuity or installment option is payable to a designated Beneficiary,
distributions may be made for a period certain not greater than the life
expectancy of the designated Beneficiary commencing on or before
December 31 of the calendar year immediately following the calendar year
in which the Participant died.


 


(ii)                                  Surviving
Spouse.  If the designated
Beneficiary is the Participant’s surviving spouse, the date that distributions
payable for a period certain not greater than the life expectancy of the
Participant’s surviving spouse are required to begin to the Participant’s
surviving spouse shall not be earlier than the later of December 31 of the
calendar year immediately following the calendar year in which the Participant
died, and December 31 of the calendar year in which the Participant would
have attained age 70-1/2.


 


(iii)                               Death
of Spouse.  If the surviving spouse
dies after the Participant, but before payments to the spouse begin, the
provisions of this subsection, with the exception of paragraph (ii), shall be
applied as if the surviving spouse were the Participant.


 


(b)                                 Death
After Required Beginning Date.  If a
Participant dies after the Participant’s required beginning date, any remaining
Plan benefits attributable to the Participant’s UniCARE Amount, Cost Care
Amount and NCPPO Amount will continue to be distributed at least as rapidly as
under the method of distribution in effect before the Participant’s death.


 


1.06                           Timing.  Subject to Regulation 1.411(a)-11(c)(7) and
the provisions of this Plan, benefits of a former Participant shall become
payable no later than 60 days after the last to occur of (a) the last day of
the Plan Year in which the Participant attains age 65, (b) the last day of the
Plan Year in which the Participant separates from employment with the Company,
or (c) the 10th anniversary of the last day of the Plan Year in which the
Participant commenced participation in the Plan.


 


46

















 


APPENDIX IX:  MERGER OF


NATIONAL CAPITAL PREFERRED PROVIDER ORGANIZATION, INC.

401(k) PLAN


 


The National Capital
Preferred Provider Organization, Inc. 401(k) Plan (the “NCPPO Plan”) is merged
with and into the Plan effective as of June 1, 1999 (the “Merger
Date”).  The merger of the Plan and
NCPPO Plan is effected in accordance with the following provisions:


 


1.01                           Eligibility.  Effective June 1, 1999,
notwithstanding anything to the contrary in the Plan, each Employee who is a
participant in the NCPPO Plan on May 31, 1999 will be eligible to
participate in the Plan in accordance with the provisions in Article IV.


 


1.02                           Transfer
of Account Balances.  The account
balances of each participant (including former and active employees of NCPPO)
in the NCPPO Plan (each an “NCPPO Participant”) will be transferred to the Plan
through a direct transfer from the trust fund of the NCPPO Plan to the Trust
Fund for the Plan on the Merger Date and will be held on behalf of the NCPPO
Participants.  References in the Plan to
“Participant” shall include any NCPPO Participant who ceased to be an employee
of NCPPO before the Merger Date.  The
rights and benefits of such an individual will be determined in accordance with
the provisions of the NCPPO Plan in effect on the date on which such NCPPO
Participant ceased to be an NCPPO employee. 
Such rights and benefits also will be subject to any provisions of the
Plan that are specifically made effective to such date.


 


1.03                           Amount
of Account.  The account balance
maintained for each NCPPO Participant immediately prior to the Merger Date
shall be credited to the Account maintained for such individual under the Plan
immediately after the Merger Date.


 


1.04                           Protected
Benefits.  The terms and provisions
of the Plan will govern the rights, benefits and entitlements of all
Participants and any other individuals who have an interest in an Account under
the Plan.  The terms and provisions of
the NCPPO Plan are extinguished and will cease to have any force or effect as
of the Merger Date.  However, this
Appendix IX is designed to preserve under the Plan any benefits that were
accrued under the NCPPO Plan prior to the Merger Date to the extent such
benefits are protected under Code Section 411(d)(6) (‘Protected
Benefits’).  Consequently, this Appendix
IX is applicable only to assets (adjusted for future gains, losses, expenses
and restorations of forfeitures) transferred to the Plan from the NCPPO Plan
(“NCPPO Amount”) on behalf of an NCPPO Participant.  All references to a Participant’s NCPPO Amount in this Appendix
are to that Participant’s NCPPO Amount as of the most recent Valuation Date.  The following benefits, rights and features
are Protected Benefits with respect to NCPPO Amounts:


 


(a)                                  An
NCPPO Participant’s right to withdraw amounts attributable to his or her
after-tax contributions, subject to  distribution provisions in
Section 1.09 below.


 


(b)                                 The
automatic and optional distribution forms of benefit specified below in
Section 1.09 below.


 


1.05                           Immediate
Vesting.  An NCPPO Participant’s
NCPPO Amount will be fully vested at the Merger Date to the extent not
previously vested.


 


47

















 


1.06                           Investment
of Account Balance.  The account
balances transferred from the NCPPO Plan to the Plan will be invested in such
Fund or Funds as the Committee deems appropriate.  Following reconciliation of the transferred account balances, the
NCPPO Amount will be invested in accordance with each Participant’s investment
directive.


 


1.07                           Service
Credit.  Service recognized under the
NCPPO Plan will not be taken into account for purposes of determining whether a
NCPPO Participant is eligible for the Grandfathered Match that was implemented
in 1997.


 


1.08                           Previous
Authorizations.  All distributions
in progress, outstanding loans, beneficiary designations and qualified domestic
relations orders under the NCPPO Plan, except as provided to the contrary in
this Appendix will be effective under the Plan as of the Merger Date until such
time as such distributions in progress, outstanding loans, beneficiary
designations and qualified domestic relations orders shall be made under the
Plan for NCPPO Participants.


 


1.09                           Distributions.


 


(a)                                  General
Plan Provisions.  A NCPPO
Participant may elect to receive his or her NCPPO Amount pursuant to the
withdrawal or the distribution provisions (e.g., a single sum) generally
applicable to assets held under the Plan.


 


(b)                                 Annuity
Options.  For distributions that
begin prior to the Change Date described in Section 1.13, a NCPPO
Participant may elect to have his or her NCPPO Amount used to purchase a
nontransferrable annuity contract that will be distributed to the Participant
in full satisfaction of all Plan obligations to the Participant and the
Participant’s Beneficiaries with regard to the Participant’s NCPPO Amount.  A Participant who makes such an election
will be subject to the Notice and Waiver Provisions contained in
Section 1.10 of this Appendix and to the following additional
requirements.


 


(i)                                     Normal
Form.  If the Participant is not
married on his or her Annuity Starting Date, the Participant’s Normal Form will
be a single life annuity with an installment refund.  If the Participant is married on his or her Annuity Starting
Date, the Participant’s Normal Form will be an immediate annuity for the life
of the Participant with a survivor annuity for the life the Participant’s
spouse (determined as of the date of distribution of the contract) which is 50%
of the amount of the annuity that is payable during the joint lives of the
Participant and the Participant’s spouse.


 


(ii)                                  Alternate
Form.  Subject to the requirements
of Code Section 401(a)(9) and the consent requirements in Section 1.10(c)
below, a Participant may elect to receive:


 


(A)                              a
single life annuity with a certain period of five, ten or fifteen years;


 


(B)                                a
straight life annuity;


 


(C)                                a
reduced immediate annuity for his or her life with a survivor annuity with
installment refund that is 50%, 66-2/3% or 100% of the amount of the annuity
that is payable during the joint lives of the Participant and the Beneficiary;


 


48

















 


(D)                               a
fixed period annuity for any period of whole months not less than sixty,
provided the payout term does not exceed the life expectancy of the Participant
and Beneficiary where the life expectancy is not recalculated; or


 


(E)                                 substantially
equal annual installments over a period certain that does not extend beyond the
life expectancy of the Participant or the joint life expectancies of the
Participant and the Participant’s Beneficiary. 
Life expectancies will not be recalculated.


 


1.10                           Notice
and Waiver Provisions.  Subject to
the “Special Waiver of 30-Day Requirement” rules in Article XI of this
Plan, the following provisions are applicable to distributions and withdrawals
described in Section 1.10(b) and Section 1.11(a) of this Appendix.


 


(a)                                  Notice.  No less than 30 days and no more than 90
days before the Annuity Starting Date, the Committee will provide the
Participant, or the Participant’s surviving spouse, as the case may be, with a
written explanation of the terms and conditions of the Normal Form, the right
to make, and the effect of, an election to waive the Normal Form, the right of
the Participant’s spouse (if any) to approve a Participant’s waiver, the right
to revoke a waiver and the effect of revoking a waiver.


 


(b)                                 Procedure.  A waiver must be made on a form prepared by,
and delivered to, the Committee no earlier than 90 days before the Annuity
Starting Date.  The Participant, or the
Participant’s surviving spouse, as the case may be, may revoke or change a
waiver at any time before the Annuity Starting Date by delivering a subsequent
form to the Committee that satisfies the Plan’s waiver procedures.


 


(c)                                  Additional
Conditions Applicable to Married Participants.


 


(i)                                     Waiver.  A Participant’s spouse must waive any rights
to the Participant’s Normal Form in a document prepared by and delivered to the
Committee, that acknowledges the effect of the waiver, and that is witnessed by
a notary public.  In the waiver, the
Participant’s spouse must either consent to the specific non-spouse Beneficiary
or Beneficiaries named by the Participant, and the optional form of benefit
selected by the Participant, or acknowledge that the surviving spouse had the
right to limit consent only to a specific non-spouse Beneficiary or
Beneficiaries, and to a specific optional form of benefit, and that the
surviving spouse voluntarily elected to relinquish that right.


 


(ii)                                  Consent
Unnecessary.  If the Participant is
legally separated or abandoned (within the meaning of local law) and the
Participant has a court order to that effect (and there are no Qualified
Domestic Relations Orders as defined in Code Section 414(p) that provide
otherwise), or the spouse cannot be located, then the waiver described in the
preceding paragraph need not be filed with the Committee when a married
Participant elects an optional form of benefit.


 


(iii)                               Effect
of Consent.  Any waiver by a spouse
obtained pursuant to these procedures (or establishment that the consent of a
spouse could not be obtained) is effective only with respect to that spouse.


 


1.11                           Death
Benefits.  Subject to the
requirements of Code Section 401(a)(9), the following death benefit
provisions apply to NCPPO Amounts.


 


49

















 


(a)                                  Married
Participant Who Elected an Annuity. 
For distributions made prior to the Change Date described in
Section 1.13, if a married Participant properly elects an annuity pursuant
to the terms of this Appendix and dies before his or her Annuity Starting Date,
the Participant’s NCPPO Amount will be used to purchase a single life annuity
(the Normal Form) for the Participant’s surviving spouse as soon as
administratively possible after the Participant’s spouse requests purchase of
such an annuity.  Pursuant to the Notice
provisions of Sections 1.10(a) and (b) of this Appendix, the Participant’s
surviving spouse may elect to receive the Participant’s NCPPO Amount pursuant
to the distribution provisions generally applicable to assets held under the
Plan instead of in the Normal Form of a single life annuity with an installment
refund.


 


(b)                                 Unmarried
Participant.  If an unmarried
Participant dies before his or her Annuity Starting Date, the Participant’s
NCPPO Amount will be distributed pursuant to the distribution provisions
generally applicable to assets held under the Plan and neither the annuity nor
the installment provisions of this Appendix will not apply.


 


(c)                                  Married
Participant Who Did Not Elect an Annuity Before the Change Date.  If a married Participant who did not
properly elect an annuity pursuant to the terms of this Appendix dies before
his or her Annuity Starting Date, the Participant’s NCPPO Amount will be
distributed pursuant to the distribution provisions generally applicable to
assets held under the Plan and neither the annuity nor the installment
provisions of this Appendix will apply.


 


1.12                           Loans.  A Participant must obtain the consent of his
or her spouse to a loan from the Plan to the extent the loan is secured by the
Participant’s NCPPO Amount and is made prior to the Change Date described in
Section 1.13.  The spouse’s consent
must be provided as described in Section 1.10(c) above.


 


1.13                           Change
Date.  For purposes of this Appendix
V, Change Date means July 1, 2001, provided that each affected
Participant is furnished a summary of material modifications that reflects the
elimination of the annuity and installment distribution options as applied to
NCPPO Amounts not less than 90 days prior to such date.


 


1.14                           Special
Effective Dates.  The following
special effective dates apply to the provisions of the NCPPO Plan:


 


(a)                                  Effective
December 12, 1994, contributions and benefits with respect to qualified
military service are provided to the extent required by Code
Section 414(u) consistent with the Uniformed Services Employment and
Reemployment Rights Act of 1994.


 


(b)                                 Effective
January 1, 1998, the definition of “Compensation” for Code
Section 415 testing is expanded to include elective contributions that are
not includible in gross income under Code Sections 125, 402(e)(3), 402(h) and
403(b) for all purposes, including Code Section 415 testing, consistent
with the Small Business Job Protection Act of 1996.


 


(c)                                  Effective
January 1, 1997, the return of excess contributions and excess aggregate
contributions to a Highly Compensated Employee is based on the amount of the
Employee’s contributions rather than his or her deferral or contribution
percentage consistent with the Small Business Job Protection Act of 1996.


 


50

















 


(d)                                 Effective
January 1, 1997, the definitions of “Highly Compensated Employee” and
leased employee are amended consistent with the Small Business Job Protection
Act of 1996.


 


51

















 


APPENDIX X:

MERGER OF RUSH PRUDENTIAL HEALTH PLANS RETIREMENT PLAN


 


1.01                           Eligibility.  Effective the first day of the first payroll
period beginning after March 3, 2000 (“Acquisition Date”),
notwithstanding anything to the contrary in the Plan, each individual employed
by Rush Prudential Health Plans (“Rush Prudential”) on the day immediately
preceding the Acquisition Date who becomes an Employee as of the Acquisition
Date will be eligible to participate in the Plan to the extent that he or she
satisfies the Plan’s eligibility requirements, taking into account the
applicable service crediting provisions in Article III of the Plan.


 


1.02                           Transfer
of Account Balances.  As soon as
administratively possible following the Acquisition Date, the Rush Prudential
Health Plans Retirement Plan (“Rush Pru Plan”) will be merged into this Plan,
thereby amending the terms of the Rush Pru Plan, which will cease to have any
force or effect.  In connection with the
merger, the account balance of (i) each individual participating in the Rush
Pru Plan who became an Employee as of the Acquisition Date, and (ii) each
former employee of Rush Prudential with a balance in the Rush Pru Plan as of
the merger date (each a “Rush Pru Employee”) will be transferred to the
Plan.  References in the Plan to
“Participant” include any Rush Pru Employee who ceased to be an employee of
Rush Prudential prior to the Acquisition Date, but had an account balance under
the Rush Pru Plan as of the merger date.


 


1.03                           Service
Credit.  Service recognized under the Rush
Pru Plan will not be taken into account for purposes of determining whether a
Rush Pru Employee is eligible for the Grandfathered Match that was implemented
in 1997.  Service recognized under the
Rush Pru Plan will be taken into account for purposes of determining whether a
Rush Pru Employee has incurred five One Year Periods of Severance.


 


1.04                           Previous
Authorizations.  All distributions
in progress, outstanding loans, beneficiary designations and qualified domestic
relations orders initiated under the Rush Pru Plan, except as provided to the
contrary in this Appendix, will be administered under the Plan as of the merger
date.


 


1.05                           Restoration
of Forfeitures.  Each Rush Pru
Employee who became an Employee as of the Acquisition Date was fully vested in
any benefits accrued under the Rush Pru Plan. 
Under the terms of the Rush Pru Plan, the nonvested portion of a participant’s
account balance (if any) was forfeited at the earlier of (i) the date the
participant received a distribution or (ii) the date the participant had a
one-year break in service.


 


(a)                                  Return
to Service.  If an individual
described in clause (i) above becomes an Employee after the Acquisition
Date but before incurring five consecutive one-year breaks in service (as
determined under the Rush Pru Plan), the amount forfeited will be restored
(without earnings) to the individual’s Account under the Plan if the individual
pays to this Plan the full amount of such distribution within five years after
the date of his employment as an Employee. 
If an individual described in clause (ii) above becomes an Employee
after the Acquisition Date and before incurring five consecutive one-year
breaks in service, the amount forfeited will be restored to the individual’s
Account under the Plan.


 


(b)                                 Funds.  Funds for restoring forfeitures under this
Section will be drawn from a special contribution the Plan to be made by
the appropriate Participating Company,


 


52

















 


as determined by the Committee. 
The special contribution will not be subject to the limitations under
the Internal Revenue Code Section 415.


 


53

















 


APPENDIX XI: 

MERGER OF BLUE CROSS AND BLUE SHIELD OF GEORGIA, INC.

TAX-FAVORED SAVINGS PROGRAM


 


The Blue Cross and Blue
Shield of Georgia, Inc. Tax-Favored Savings Program (the “Georgia Savings
Program”) is merged into the Plan effective as of 11:59 p.m. on
May 31, 2001.  Assets and
liabilities of the Georgia Savings Program, together with the assets and
liabilities of this Plan, constitute a single plan within the meaning of Code
Section 414(l) as of June 1, 2001 (the “Plan Merger Date”).  Unless otherwise expressly provided herein,
the rights and benefits of a participant in the Georgia Savings Program who
terminated employment with Blue Cross and Blue Shield of Georgia, Inc. (“BCBSGA”)
on or prior to May 31, 2001 are determined in accordance with the
provisions of the Georgia Savings Program as in effect prior to
June 1, 2001.  References in
the Plan to “Participant” as defined in Article II include each individual
with an interest in the Georgia Savings Program without regard to his or her
status as an Employee or former Employee (each a “Georgia Participant” for
purposes of this Appendix).  This
Appendix XI is designed to preserve under the Plan any benefits that were
accrued under the Georgia Savings Program prior to June 1, 2001 to
the extent such benefits are protected under Code Section 411(d)(6).  The provisions of the Plan apply to the
benefits of employees and former employees of BCBSGA described in this Appendix
subject to the restriction applicable to protected benefits described in the
prior sentence and except to the extent modified by the terms of this
Appendix.  In the event of a conflict,
the provisions of this Appendix will control.


 


1.01                           Eligibility.  Notwithstanding anything to the contrary in
the Plan, each individual employed by BCBSGA on May 31, 2001 who is
an Employee on the Plan Merger Date will be eligible to participate in the Plan
on June 1, 2001, provided that he or she otherwise satisfies the
Plan’s eligibility requirements.  In no
event will any such individual’s Salary Deferral Contribution election apply to
Compensation earned prior to June 1, 2001.


 


1.02                           Matching
Contributions.  For purposes of
determining the six percent (6%) limit on Matching Contributions, only
Compensation that a Georgia Participant earns on and after the Plan Merger Date
while eligible for Matching Contributions under the Plan will be taken into
account.


 


1.03                           Distribution
on Disability.  If a Georgia
Participant becomes disabled (as defined under the Georgia Savings Program as
in effect at May 31, 2001) while an Employee, he or she may withdraw
the portion of his or her Account attributable to benefits accrued under the
Georgia Savings Program prior to the Plan Merger Date in a lump sum.


 


1.04                           Full
Vesting.  Each Georgia Participant
who is an Employee as of the Plan Merger Date will be fully vested in his or
her Account, including in the benefits accrued under the Georgia Savings
Program.


 


1.05                           Restoration
of Forfeitures.  If the nonvested
part of a former Georgia Participant’s account was forfeited following a
distribution of the vested part upon termination of employment prior to the
Plan Merger Date, such nonvested part will be restored as follows.  If the former BCBSGA employee becomes an
Eligible Employee within the applicable time limit on or after the Plan Merger
Date, and repays the amount of the prior distribution within the applicable
time limit, the nonvested part that was previously forfeited will be restored
(without interest), and the entire account will be fully vested.  The former employee must become an Eligible
Employee before incurring five consecutive one-year breaks in service (as
determined


 


54

















 


under the Georgia Savings Program as in effect at
May 31, 2001) and make the repayment within five years of the date of
his or her employment as an Eligible Employee. 
If a former BCBSGA employee who terminated employment prior to the Plan
Merger Date becomes an Eligible Employee prior to incurring five consecutive
one-year breaks-in-service, and did not receive a distribution at his or her
prior termination of employment, any nonvested part of his or her Account that
was previously forfeited will automatically be restored, and the entire Account
will be fully vested.  Funds for
restoring forfeited amounts under this Section will be drawn from a
special contribution to the Plan to be made by the appropriate Participating
Company, as determined by the Committee. 
The special contribution will not be subject to the limitations under
the Internal Revenue Code Section 415.


 


1.06                           Use
of Forfeitures.  Any forfeitures
existing under the Georgia Savings Program at the Plan Merger Date will be
applied against Matching Contributions.


 


1.07                           Previous
Authorizations.  All distributions in
progress, outstanding loans and hardship distributions initiated under the
Georgia Savings Program, except as provided to the contrary in this Appendix,
will be administered under the Plan as of the Plan Merger Date.


 


1.08                           Special
Effective Dates.  The following
special effective dates apply to the provisions of the Georgia Savings Program
as in effect prior to the merger:


 


(a)                                  Effective
December 12, 1994, contributions and benefits with respect to qualified
military service are provided to the extent required by Code
Section 414(u) consistent with the Uniformed Services Employment and
Reemployment Rights Act of 1994.


 


(b)                                 Effective
January 1, 1998, the definition of “Section 415 Compensation” is
expanded to include elective contributions that are not includible in gross
income under Code Sections 125, 402(e)(3), 402(h) and 403(b) for all purposes,
including Code Section 415 testing, consistent with the Small Business Job
Protection Act of 1996.  Effective January 1,
2001, Section 415 Compensation is further expanded to include elective
salary reductions not included in gross income under Code
Section 132(f)(4) consistent with the Community Renewal Tax Relief Act of
2000.


 


(c)                                  Effective
for Limitation Years beginning on and after January 1, 2000, the combined
limit under Code Section 415(e) is eliminated consistent with the Small
Business Job Protection Act of 1996.


 


(d)                                 Effective
January 1, 1997, the return of excess contributions and excess aggregate
contributions to a Highly Compensated Employee is based on the amount of the
Employee’s contributions rather than his or her deferral or contribution
percentage consistent with the Small Business Job Protection Act of 1996.


 


(e)                                  Effective
January 1, 2000, an “eligible rollover distribution” does not include salary
deferral contributions distributed in a hardship distribution consistent with
the Restructuring and Reform Act of 1998.


 


(f)                                    Notwithstanding
anything contrary in the Plan, including Appendix VIII, a Georgia Participant
may not defer payment of Plan benefits past his or her required beginning date
as modified by this subsection (f). 
If a Georgia Participant attains age 70-1/2 before January 1, 2002,
or if the Participant is a 5% owner (within the meaning of Code
Section 416(i)), his or her required beginning date is April 1
following the close of the calendar year in


 


55

















 


which the Participant attains age 70-1/2.  If a Participant who is not a 5% owner attains age 70-1/2 on or
after January 1, 2002, his or her required beginning date is April 1
of the later of (i) the calendar year following the calendar year in which the
Participant attains age 70-1/2, or (ii) the calendar year following the
calendar year in which the Participant terminates employment.


 


56