Exhibit 4.1





Exhibit 4.1




COLONIAL PROPERTIES TRUST

401(k) PROFIT SHARING PLAN




(Amended & Restated)




COLONIAL PROPERTIES TRUST, an Alabama Real Estate Investment Trust organized and existing
under the laws of the State of Alabama, with its principal place of business in Birmingham, Alabama
(hereinafter called the “Employer”), hereby adopts and publishes on this the 27th day of
October, 2009 this Amended and Restated 401(k) Profit Sharing Plan for the exclusive benefit of
such of its Employees who may become Participants and their Beneficiaries as set forth in this
document, pursuant to Section 401(a) of the Internal Revenue Code, as follows:



W I T N E S S E T H:




WHEREAS, said Plan provides that the Employer reserves the right at any time and from time to
time, by action of its Executive Committee, to amend in whole or in part any and all provisions of
said Plan; and



WHEREAS, the Executive Committee of the Employer specifically approved and adopted, by
resolution, the Colonial Properties Trust 401(k) Profit Sharing Plan, as hereinafter restated,
which amends and restates the Colonial Properties Trust 401(k) Profit Sharing Plan and Trust
Agreement in its entirety; and



NOW, THEREFORE, in consideration of the above premises and the mutual covenants herein
contained, Employer amends said Plan as of the dates hereof and causes the terms and provisions of
the original Plan and amendments thereto to be modified and amended as set forth herein:



ARTICLE I




PURPOSE




The purpose of the Plan is to provide a regular method whereby Employer will make contributions to
a Trust Fund, to be received, held and disbursed pursuant to the terms of a Trust Agreement dated
the 18th day of December, 2001 (hereinafter for brevity referred to as the “Trust
Agreement”) and to provide financial security for its employees upon their retirement or disability
and for their beneficiaries in the event of death. It is intended that this Plan qualify as a
profit sharing plan for purposes of Section 401(a) of the Code. It is also intended that the Plan
provide a method for employees to have an effective opportunity to contribute a portion of their
compensation pursuant to a salary reduction agreement and that the Plan qualify as a cash or
deferred Plan pursuant to Section 401(k) of the Code. The Trust Fund will be devoted to the
exclusive benefit of the participating employees and their beneficiaries, and in no event will any
part of the corpus or trust income revert to Employer or be used for or devoted to any other
purpose.


 


 









 





ARTICLE II




NAME AND EFFECTIVE DATES




2.1 Name of Plan. The name of this Plan shall be the Colonial Properties Trust 401(k) Profit Sharing Plan.



2.2 Contributing Date. The contributing date shall be as of the Anniversary Date of the Plan.



2.3 Effective Date. The original Effective Date of this Plan is January 1, 1995.



2.4 Restatement Effective Dates. Unless otherwise specified herein, the Plan is amended and restated effective January 1,
2009, except the following effective dates shall apply to the provisions specified below:



Plan Years beginning after December 31, 2005: Provisions to implement the Final Treasury
Regulations under Code Sections 401(k) and 401(m), including:



	 	 	 
	Section 3.3

	 	Numerator of ADP ratio excludes catch-up contributions
	 
	 	 
	Section 3.21

	 	Updated definition of “Elective Deferrals”
	 
	 	 
	Section 5.2

	 	Re-Hired Employees — Elective Deferrals are taken into account in applying the Rule of Parity
	 
	 	 
	Section 6.1(c)

	 	Catch-up contributions included in deferrals to which Safe Harbor Matching Contribution applies;
	 
	 	 
	Section 6.3(c)

	 	“Excess Deferrals” modified by Catch-up Contributions
	 
	 	 
	Sections 6.3, 6.5
and 6.6

	 	Determination of Income and Loss of Excess Deferrals, Excess Contributions
and Excess Aggregate Contributions
	 
	 	 
	Section 8.14(a)

	 	Addition of two new safe-harbor financial circumstances.
	 
	 	 
	Sections 9.3

	 	Elective Deferrals are taken into account in the “deemed zero cashout” provisions.
	 
	 	 
	Section 15.3(b)

	 	Distribution Limitation for Elective Deferrals (definition of “successor” plan)
	 
	 	 
	Distributions made on and after March 28, 2005:
	 
	 	 
	Sections 8.8, 8.9

	 	General Consent Rules and Involuntary Cashout/Automatic Rollover
	 
	 	 
	Section 17.8(b)(vii)

	 	Dollar threshold for alternate payee consent






 


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	Plan Years beginning after December 31, 2001 (EGTRRA):
	 
	 	 
	Section 3.15(f)

	 	Increase in annual compensation taken into account under the Plan to $200,000
	 
	 	 
	Section 3.39

	 	Key Employee definition
	 
	 	 
	Section 6.3

	 	Increase in deferral limitation and addition of catch-up contributions
	 
	 	 
	Section 7.4

	 	Limitations on Annual Additions
	 
	 	 
	Section 8.1(a)

	 	Events upon which Elective Deferrals, Qualified Discretionary Employer Contributions, Qualified
Employer Matching Contributions and Safe-Harbor contributions may be distributed
	 
	 	 
	Section 8.14(b)

	 	Suspension period following hardship distribution reduced from 12 to six months; post-hardship
contribution limit deleted
	 
	 	 
	Section 10.1(b)

	 	Use of Employer Matching Contributions to satisfy top heavy minimum
	 
	 	 
	Section 10.2

	 	Top-Heavy — Determination of present values and amounts
	 
	 	 
	Section 11.2

	 	Definitions of Eligible Rollover Distribution and Eligible Retirement Plan
	 
	 	 
	Section 11.3

	 	Expansion of types of rollovers a plan may accept






[End of Page]




 


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ARTICLE III




DEFINITIONS




When used herein, the following words and phrases shall have the following meanings, unless the
context clearly indicates otherwise.



3.1 “Accrued Benefit” shall mean the sum, as of the last Valuation Date, of the balances of
all accounts maintained for a Participant.



3.2 “Actual Contribution Percentage” shall mean the average of ratios (expressed as a
percentage to the nearest one-hundredth of one percent) for a specified group of Participants for a
Plan Year, calculated separately for each Participant in such group as follows:



(a) The numerator of such ratio is the sum of any Employer Matching Contributions and
Qualified Employer Matching Contributions (to the extent not taken into account for purposes of the
Actual Deferral test).



(b) The denominator of such ratio is the W-2 compensation of each Participant in the group for
the portion of such Plan Year that the Employee was a Participant in the Plan.



(c) At the Employer’s election, the numerator may include Qualified Discretionary Employer
Contributions and Elective Deferrals, provided the Actual Deferral Percentage test is met before
the Elective Deferrals are used in the Actual Contribution Percentage test and continues to be met
following the exclusion of such Elective Deferrals that are used in the Actual Contribution
Percentage test.



(d) The numerator shall not include Employer Matching Contributions that are forfeited either
to correct Excess Aggregate Contributions or because the contributions to which they relate are
Excess Deferrals, Excess Contributions, or Excess Aggregate Contributions.



(e) The ratio shall be zero for a Participant for whom no Employer Matching Contributions,
Qualified Discretionary Employer Contributions or Elective Deferrals are made.



3.3 “Actual Deferral Percentage” shall mean the average of ratios (expressed as a percentage
to the nearest one-hundredth of one percent) for a specified group of Participants for a Plan Year,
calculated separately for each Participant in the group as follows:



(a) The numerator of such ratio is the sum of the following Employer contributions actually
paid over to the Trust on behalf of each Participant in the group for the Plan year:



(i) Elective Deferrals (other than Catch-up Contributions) made pursuant to the Participant’s
deferral election (including Excess Deferrals of Highly Compensated Employees, excluding Excess
Deferrals of Non-highly Compensated Employees that arise solely from Elective Deferrals made under
the Plan or plans of the Employer, and excluding Elective Deferrals that are taken into account in
the Actual Contribution Percentage), and



(ii) At the election of the Employer, Qualified Discretionary Employer Contributions and
Qualified Employer Matching Contributions of each Participant in the group.


 


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(b) The denominator of such ratio is the W-2 compensation of each Participant in the group for
the portion of such Plan Year that the Employee was a Participant in the Plan.



(c) The ratio shall be zero for an Employee who would be a Participant but for the failure to
make Elective Deferrals.




3.4 “Affiliated Service Group” shall mean:



(a) a group of service Organizations consisting of the Employer and one or more of the
following:



(i) Any service Organization which — (A) is a shareholder or partner of the Employer, and (B)
regularly performs services for the Employer or is regularly associated with the Employer in
performing services for third persons, and



(ii) Any other Organization if — (A) a significant portion of the business of such
Organization is the performance of services for the Employer, for Organizations described in
subparagraph (a)(i) hereinabove, or for both, which is of a type historically performed in such
service field by employees, and (B) ten percent (10%) or more of the interests in such Organization
is held by persons who are Highly Compensated Employees of the Employer or an Organization
described in subparagraph (a)(i) hereinabove; or




(b) a group of Organizations consisting of:



(i) an Organization the principal business of which is performing, on a regular and continuing
basis, management functions for the Employer or any Organization which is a “Related Organization”
to the Employer; and



(ii) the Employer and the Related Organization for which said services are performed.



(iii) for purposes of this Section, “Related Organization” shall mean:



(A) any Organization which would be a member of the Controlled Group pursuant to Section
1563(a) of the Code, except that for purposes of Section 415 of the Code, the phrase “more than
50%” shall be substituted for the phrase “at least 80%” each place it appears in Section 1563(a) of
the Code; or



(B) the relationship of the Employer and the Organization would result in a disallowance of
losses under Sections 267 or 707(b) of the Code.



(c) For purposes of this Section, after December 31, 1984, the term “Organization” shall mean
a corporation, partnership, or other Organization and, in determining ownership pursuant to
subsection (a) hereinabove, the principles of Section 318(a) of the Code shall apply.



3.5 “After-Tax Account” shall mean the account maintained to hold after-tax contributions and
any attributable earnings made by a participant to the Transferor Plan.



3.6 “Age” shall mean attained age.


 


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3.7 “Anniversary Date” shall mean the last day of the Plan Year.



3.8 “Annuity Starting Date” shall mean the first day of the first period for which an amount
is paid as an annuity or, in the case of a benefit not payable in the form of an annuity, the first
day on which all events have occurred which entitle the Participant to such benefit.




3.9 “Beneficiary” shall mean:



(a) Subject to the distribution provisions of Article VIII, the person or persons selected in
writing by the Participant to receive the benefits under the Plan in the event of the Participant’s
death. Wherever the rights of a Participant are stated or limited herein, his Beneficiary shall be
deemed bound thereby. If any Participant shall fail to designate a Beneficiary, or if there is no
designated Beneficiary surviving at the Participant’s death, the Administrator shall be empowered
to designate a Beneficiary or Beneficiaries on his behalf, but only from among the following, in
the order named: (1) spouse, (2) children, in equal shares, (3) parents, in equal shares or
survivor, (4) brothers and sisters, per stirpes, and (5) estate of the Participant. In the event
any of the above shall be under the age of majority, then the proceeds shall be paid in accordance
with the provisions of Section 8.23.



(b) For purposes of determining a Participant’s Beneficiary, the latest designation filed with
the Employer shall control, and intervening changes in circumstances shall be ignored; provided, if
a Participant’s spouse is designated as Beneficiary but thereafter is divorced from the
Participant, such designation shall become invalid as of the date of divorce unless the Participant
files a Beneficiary designation form with the Employer after the date of divorce confirming
designation of such former spouse as Beneficiary.



3.10 “Board” shall mean the Board of Trustees of the Employer or, if applicable a
participating employer, Board of Directors of such participating employer.



3.11 “Break In Service” shall mean a Plan Year during which a Participant has not completed
more than five hundred (500) Hours of Service with the Employer.



3.12 “Catch-up Contributions” shall mean those Elective Deferrals described in Section 6.3(b)
hereinbelow.




3.13 “Code” shall mean the Internal Revenue Code of 1986, as amended.



3.14 “Company Stock” shall mean the share of common stock and/or common shares of beneficial
interest of the Employer.




3.15 “Compensation” shall mean:



(a) a Participant’s compensation which would be included on his Federal W-2 Form for the Plan
Year for which the contribution is made, excluding contributions to any Qualified Plan or any
non-qualified deferred compensation plan.



(b) Compensation shall exclude (i) Employer-paid contributions under this Plan and any
deferred compensation plan to the extent not currently taxable to the Participant, (ii) cash and
non-cash fringe benefits, (iii) reimbursements and expense allowances, (iv) moving expenses, and
(v) welfare benefits.


 


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(c) Compensation shall include Elective Deferrals made pursuant to a salary reduction
agreement which are not includible in the gross income of the Employer under Sections 125,
132(f)(4), 402(e)(3), 402(h)(1)(B) or 403(b) of the Code.



(d) Compensation shall not include deemed Section 125 compensation for purposes of the
definition of Compensation.




(e) HEART Act Provision:



(i) For years beginning after December 31, 2008, and in accordance with the HEART Act, (A) an
individual receiving a differential wage payment, as defined by Code §3401(h)(2), is treated as an
Employee of the Employer making the payment, (B) the differential wage payment is treated as
compensation, and (C) the Plan is not treated as failing to meet the requirements of any provision
described in Code §414(u)(1)(C) by reason of any contribution or benefit which is based on the
differential wage payment.



(ii) Subparagraph (e)(i)(C) above applies only if all employees of the Employer performing
service in the uniformed services described in Code §3401(h)(2)(A) are entitled to receive
differential wage payments (as defined in Code §3401(h)(2)) on reasonably equivalent terms and, if
eligible to participate in a retirement plan maintained by the Employer, to make contributions
based on the payments on reasonably equivalent terms (taking into account Code §§410(b)(3), (4),
and (5)).



(f) In addition to other applicable limitations set forth in the Plan, and notwithstanding any
other provision of the Plan to the contrary, the annual Compensation of each Participant taken into
account in determining allocations for any Plan Year shall not exceed $200,000, as adjusted for
cost-of-living increases in accordance with Section 401(a)(17)(B) of the Code. Annual Compensation
means Compensation during the Plan Year or such other consecutive 12-month period over which
Compensation is otherwise determined under the Plan (the determination period). The cost-of-living
adjustment in effect for a calendar year applies to annual Compensation for the determination
period that begins with or within such calendar year. If a determination period consists of fewer
than 12 months, the annual compensation limit will be multiplied by a fraction, the numerator of
which is the number of months in the determination period, and the denominator of which is 12.



(g) If compensation for any prior determination period is taken into account in determining an
Employee’s allocations for the current Plan Year, the compensation for the prior determination
period is subject to the annual compensation limit in effect under Section 401(a)(17) for that
prior determination period.



(h) In the case of an Employee who becomes eligible to participate in the Plan on a date other
than the first day of the Plan Year, Compensation with respect to such Year shall be determined
from the date of participation.



3.16 “Controlled Group” shall mean a controlled group of corporations (under Code Section
414(b)), or a group of trades or businesses under common control (under Code Section 414(c)) of
which the Employer is a member, and any other entity required to be aggregated with the Employer
pursuant to Code Section 414(o).



3.17 “Disability” shall mean, for all purposes under this Plan, a condition under which a
Participant is determined to be totally and permanently disabled by the Social Security
Administration. The payment of supplemental security income (SSI) is not deemed to be a
determination by Social Security that a Participant has met its definition of disability.


 


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3.18 “Discretionary Employer Contribution” shall mean a contribution made by the Employer
pursuant to Section 6.1(a).



3.19 “Discretionary Employer Contribution Account” shall mean the account maintained for a
Participant to record his share of Discretionary Employer Contributions and forfeitures, and
adjustments relating thereto.




3.20 “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended.



3.21 “Elective Deferrals” shall mean any Employer contributions made to the Plan at the
election of the Participant, in lieu of cash compensation. With respect to any taxable year, a
Participant’s Elective Deferral is the sum of all Employer contributions made on behalf of such
Participant pursuant to an election to defer under any qualified CODA described in Code Section
401(k), any salary reduction simplified employee pension described in Code Section 408(k)(6), any
SIMPLE IRA plan described in Code Section 408(p) and any plan described under Code Section
501(c)(18), and any Employer contributions made on behalf of a Participant for the purchase of an
annuity contract under Code Section 403(b) pursuant to a salary reduction agreement. Elective
Deferrals shall not include any deferrals properly distributed as excess annual additions.



3.22 “Elective Deferral Account” shall mean the account maintained for a Participant to record
his Elective Deferrals with adjustments relating thereto.



3.23 “Eligibility Computation Period” shall mean the period of twelve (12) consecutive months
beginning with an Employee’s Employment Commencement Date, and thereafter, shall mean the next
succeeding Plan Year which includes the first anniversary of the Participant’s Employment
Commencement Date. An Employee who is credited with 1000 Hours of Service in both the initial
Eligibility Computation Period and the first Plan year which commences prior to the first
anniversary of the Employee’s initial Eligibility Computation Period will be credited with two
Years of Service.




3.24 “Eligibility (Plan Entry) Date” shall mean the first day of each month.



3.25 “Employee” shall mean any person employed by Employer maintaining the Plan or any other
employer required to be aggregated with such Employer under Sections 414(b), (c), (m) or (o) of the
Code. For purposes of determining whether or not the Plan meets the requirements of Section 10.2
hereof, the term Employee shall also include the Beneficiary of an Employee. The term Employee
shall also include leased employees within the meaning of Section 414(n) or 414(o) of the Code.



3.26 “Employer” shall mean Colonial Properties Trust, a real estate investment trust, having
its principal office at Birmingham, Alabama, or any successor thereto by merger, purchase, or
otherwise, and any participating employer which adopts the Plan.



3.27 “Employer Matching Contribution” shall mean a contribution made by the Employer on behalf
of a Participant on account of an Elective Deferral made pursuant to Section 6.2(a).



3.28 “Employer Matching Contribution Account” shall mean the account maintained for a
Participant to record Employer Matching Contributions (and adjustments thereto) made on his behalf.


 


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3.29 “Employment Commencement Date” shall mean the date on which an Employee first performed
an Hour of Service for the Employer. In the case of a re-hired Employee, “Employment Commencement
Date” shall mean the date on which the Employee first performed an Hour of Service after being
re-hired.



3.30 “Excess Aggregate Contributions” shall mean, with respect to any Plan Year, the excess of
(a) the aggregate amount of contributions taken into account in computing the contribution
percentage of Highly Compensated Employees for such Plan Year, over (b) the maximum amount of such
contributions permitted by the Actual Contribution Percentage test pursuant to Section 6.6.



3.31 “Excess Contributions” shall mean, with respect to any Plan Year, the excess of (a) the
aggregate amount of contributions actually taken into account in computing the deferral percentage
of Highly Compensated Employees for such Plan Year, over (b) the maximum amount of such
contributions permitted by the Actual Deferral Percentage test pursuant to Section 6.5. To the
extent a Highly Compensated Employee has not reached his Catch-up Contribution limit under the
Plan, Excess Contributions allocated to such Highly Compensated Employee are Catch-up Contributions
and shall not be treated as Excess Contributions.



3.32 “Executive Committee” shall mean the committee approved by the Board of Trustees of the
Employer.



3.33 “Five-Percent Owner” shall mean any person who is defined as a Five-Percent Owner in
Section 416(i)(1)(B) of the Code and the Regulations promulgated thereunder, which are hereby
incorporated by reference as if fully set out herein.



3.34 “Gap Period” shall mean the period between the end of a taxable year or Plan Year during
which Excess Deferrals, Excess Contributions or Excess Aggregate Contributions occur and the date
of distribution to a Participant of such excess amounts.




3.35 “HEART Act” shall mean the Heroes Earnings Assistance and Relief Tax Act of 2008.




3.36 “Highly Compensated Employee” shall mean an Employee who:




(a) was a Five-Percent Owner at any time during the Plan Year or the preceding Plan Year, or



(b) for the preceding Plan Year had compensation from the Employer greater than $80,000
(adjusted at the same time and in the same manner as under Section 415(d) of the Code, except that
the base period shall be the calendar quarter ending September 30, 1996). The term “compensation”
means Section 415 Compensation.




3.37 “Hour of Service” shall mean:



(a) Each hour for which an Employee is paid, or entitled to payment, for the performance of
duties for the Employer. These hours shall be credited to the Employee for the computation period
or periods in which the duties are performed; and



(b) Each hour for which an Employee is paid, or entitled to payment, by the Employer on
account of a period of time during which no duties are performed (irrespective of whether the
employment relationship has terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty, military duty or leave of absence. No more than 501 Hours of
Service shall be credited under this paragraph for any single continuous period (whether or not
such period occurs in a single computation period); and


 


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



(d) The provisions of Sections 2530.200(b)-2(b) and 2530.200(b)-2(c) of the regulations of the
Labor Department (relating to determining Hours of Service for reasons other than the performance
of duties and crediting of Hours of Service to computation periods) are hereby incorporated by
reference as if fully set out herein.



(e) An Employee who is not paid on an hourly basis and whose hours are not counted and
recorded shall be credited with ten (10) Hours of Service for each day during the Plan Year for
which he actually performs services for any portion of that day. An Employee shall also be
credited with ten (10) Hours of Service for any day during the Plan Year for which no services are
performed if the Employee would be entitled to be credited with at least one (1) Hour of Service
for that day under Paragraph (b) or (c) hereinabove.



(f) For Plan Years beginning after December 31, 1984, solely for purposes of determining
whether a Break In Service has occurred in a computation period, for participation and vesting
purposes, a Participant who is absent from work for maternity or paternity reasons shall receive
credit for the Hours of Service which would otherwise have been credited to such Participant but
for such absence, or in any case in which such hours cannot be determined, eight (8) Hours of
Service per day of absence. For purposes of this paragraph, an absence from work for maternity or
paternity reasons means an absence: (1) by reason of the pregnancy of the Participant, (2) by
reason of a birth of a child of the Participant, (3) by reason of the placement of a child with the
Participant in connection with the adoption of such child by such Participant or (4) for purposes
of caring for such child for a period beginning immediately following such birth or placement. The
Hours of Service credited under this Section shall be credited: (1) in the computation period in
which the absence begins if the crediting is necessary to prevent a Break In Service in that
period, or (2) in all other cases, in the following computation period. No credit will be given
under this Section, however, unless the Participant furnishes to the Plan Administrator such timely
information as the Administrator may reasonably require to establish that the absence from work is
for reasons qualifying for the maternity/paternity provisions set forth above, and the number of
days for which there was such an absence.



(g) Hours of service will be credited for employment with other members of an affiliated
service group (under Section 414(m)), a controlled group of corporations (under Section 414(b)), or
a group of trades or businesses under common control (under Section 414(c)) of which the adopting
employer is a member, and any other entity required to be aggregated with the employer pursuant to
Section 414(o) and the regulations thereunder.



(h) Hours of service will also be credited for any individual considered an employee for
purposes of this Plan under Section 414(n) or Section 414(o) and the regulations thereunder.



3.38 “Inactive Participant” shall mean a Participant who has separated from service with the
Employer.


 


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3.39 “Key Employee” shall mean any Employee or former Employee (including any deceased
employee) who at any time during the Plan Year that includes the determination date was an officer
of the Employer having annual compensation greater than $130,000 (as adjusted under section
416(i)(1) of the Code), a 5-percent owner of the Employer, or a 1-percent owner of the Employer
having annual compensation of more than $150,000. For this purpose, annual compensation means
Section 415 Compensation. The determination of who is a Key Employee will be made in accordance
with section 416(i)(1) of the Code and the applicable regulations and other guidance of general
applicability issued thereunder. The term “non-key employee” means an Employee who is not a Key
Employee and shall also include Employees who are former Key-Employees.




3.40 “Leased Employee” shall mean:



(a) Any person (other than an employee of the recipient) who pursuant to an agreement between
the recipient and any other person (“leasing organization”) has performed services for the
recipient (or for the recipient and related persons determined in accordance with Section 414(n)(6)
of the Code) on a substantially full time basis for a period of at least one year, and such
services are performed under the primary direction or control by the recipient. Contributions or
benefits provided a leased employee by the leasing organization which are attributable to services
performed for the recipient employer shall be treated as provided by the recipient employer.



(b) A leased employee shall not be considered an employee of the recipient if: (i) such
employee is covered by a money purchase pension plan providing: (1) a nonintegrated employer
contribution rate of at least 10 percent of Section 415 Compensation, including amounts contributed
pursuant to a salary reduction agreement which are excludable from the employee’s gross income
under Sections 125, 132(f)(4), 402(e)(3), 402(h)(1)(B) or 403(b) of the Code, (2) immediate
participation, and (3) full and immediate vesting; and (ii) leased employees do not constitute more
than 20 percent of the recipient’s nonhighly compensated workforce.




3.41 “Limitation Year” shall mean the Plan Year.



3.42 “Named Fiduciary” shall be the Employer or such other party, individual or otherwise,
appointed by the Board.



3.43 “Nonhighly Compensated Participant” shall mean a participant who is not a Highly
Compensated Employee.



3.44 “Normal Retirement Age” shall mean the attainment of age sixty-five (65) by a
Participant.



3.45 “Participant” shall mean any Employee who meets (or has met in prior plan years) the
participation and eligibility requirements set out in the Plan, provided that such Employee’s
nonforfeitable benefits have not been fully distributed.



3.46 “Participating Employer” shall mean any corporation, partnership, professional
corporation or professional association which has adopted the Plan pursuant to ARTICLE XVI of the
Plan. A Participating Employer must be a legal entity recognized under federal income tax law.



3.47 “Permissive Aggregation Group” shall mean the Required Aggregation Group of plans plus
any other plan or plans of the Employer which, when considered as a group with the Required
Aggregation Group, would continue to satisfy the requirements of sections 401(a)(4) and 410 of the
Code.


 


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3.48 “Plan” shall mean Colonial Properties Trust 401(k) Profit Sharing Plan, as set forth by
this document and all amendments thereto.



3.49 “Plan Administrator” (hereinafter sometimes for brevity referred to as “Administrator”)
shall be Colonial Properties Services, Inc., which shall delegate its responsibilities to the
Retirement Committee or such other party, individual or otherwise, appointed by Colonial Properties
Services, Inc.



3.50 “Plan Year” shall mean the period of twelve (12) consecutive months beginning on the
first day of January and ending on the last day of December.



3.51 “Pre-1987 Vested Account from Transferor Plan” shall mean the account to hold the
Participant’s allocations of Employer Contributions made for all Plan Years before 1987, and
earnings on those allocations. All such accounts shall be fully vested at all times.




3.52 “Prior Plan” shall mean The Colonial 401(k) and Profit Sharing Plan. Certain
Participants maintained account balances in the Prior Plan and, due to a corporate reorganization,
account balances were transferred to this Colonial Properties Trust 401(k)/Profit Sharing Plan as
of January 1, 1995, the Effective Date of this Plan. And funds transferred from the Prior Plan
have been separately accounted for since the transfer.



3.53 “Qualified Discretionary Employer Contribution” shall mean a Discretionary Employer
Contribution which is subject to the distribution and nonforfeitability requirements under Code
Section 401(k) when made.



3.54 “Qualified Employer Matching Contribution” shall mean an Employer Matching Contribution
that is subject to the distribution and nonforfeitability requirements under Code Section 401(k)
when made.




3.55 “Qualified Plan” shall mean any plan which is qualified under Section 401(a) of the Code.



3.56 “Required Aggregation Group” shall mean (1) Each Qualified Plan of the Employer in which
at least one Key Employee participates or participated at any time during the determination period
(regardless of whether the plan has terminated), and (2) any other Qualified Plan of the Employer
which enables a plan described in (l) to meet the requirements of sections 401(a)(4) or 410 of the
Code. The determination period is the Plan Year containing the determination date or any of the
preceding four Plan Years.



3.57 “Retirement Committee” shall consist of the Chairman appointed by the Plan Administrator
and such other members appointed by the Chairman (hereinafter sometimes referred to as the
“Administrator”).



3.58 “Rollover Account” shall mean the account maintained by the Employer to record transfers
to the Trust Fund pursuant to ARTICLE XI of the Plan.



3.59 “Safe Harbor Contribution” shall mean the contribution made by the Employer pursuant to
Section 6.1(c).



3.60 “Safe Harbor Contribution Account” shall mean the account maintained for a Participant to
record his share of Safe Harbor Contributions, and adjustments relating thereto.


 


III-9









 





3.61 “Section 415 Compensation” shall mean Section 415 Compensation as defined in ARTICLE VII
hereinbelow.



3.62 “Taxable Year” shall mean the 12 months during which the tax liability of the Employer or
a Participant is calculated. The Taxable Year of the Employer may or may not be the same as the
Taxable Year of a Participant.



3.63 “Top-Heavy Plan” shall mean the Plan for any Plan Year in which it is determined to be
top-heavy under Section 10.2 hereof.



3.64 “Trust Agreement” shall mean the Principal Trust Company Directed Trust Agreement, as
amended from time to time.



3.65 “Trustee” shall mean the individuals or duly authorized corporate trustee selected by the
Board to perform the duties of Trustee as set out in the Trust Agreement.



3.66 “Trust Fund” shall mean all funds and property received by the Trustee, together with all
income, profits or other increments thereon.



3.67 “Valuation Date” shall mean the date as of which the Trust Fund is valued, account
balances are determined, and adjustments and allocations are made to each account by the
Administrator. Valuation Date shall be at least annually on the Anniversary Date and such
additional dates as the Plan Administrator shall deem appropriate. The selection by the
Administrator of any additional Valuation Dates shall be made on a non-discriminatory basis.



3.68 “Vested” shall mean the portion of the Participant’s Accrued Benefit which is
nonforfeitable; fully Vested shall mean totally nonforfeitable.




3.69 “Vesting Computation Period” shall mean the Plan Year.



3.70 “Year of Service” shall mean each Eligibility Computation Period during which an Employee
has completed not less than one thousand (1,000) Hours of Service with the Employer or with any
member of the Controlled Group or Affiliated Service Group. If the Employer acquires substantially
all of the assets of another company and if former employees of such other company subsequently
become Employees of the Employer due to the acquisition, such former employees shall receive credit
for Years of Service for purposes of eligibility for the period of his employment with the acquired
company.



3.71 “Year of Vesting Service” shall mean each Vesting Computation Period during which an
Employee has completed not less than one thousand (1,000) Hours of Service with the Employer or
with any member of the Controlled Group or Affiliated Service Group. If the Employer acquires
substantially all of the assets of another company and if former employees of such other company
subsequently become Employees of the Employer due to the acquisition, such former employees shall
receive credit for Years of Vesting Service for purposes of eligibility for the period of his
employment with the acquired company.



[End of Page]





 


III-10









 







ARTICLE IV




ADMINISTRATION OF THE PLAN




4.1 Powers of the Administrator. The Administrator is empowered to administer the Plan in accordance with its terms and
shall have all powers and authority necessary to carry out the provisions of the Plan. The
Administrator shall perform the following functions:



(a) Construe and interpret the provisions of the Plan, and all parts thereof, including the
interpretation of any ambiguity, the supplying of any language which is omitted and the reconciling
of any inconsistency so that the Plan is given a reasonable interpretation and construction in
light of what was intended in establishing the Plan;



(b) To determine all questions with respect to the individual rights of the Participants and
their Beneficiaries under the Plan, including, but not limited to, all issues with respect to a
Participant’s eligibility for participation and eligibility for benefits, a Participant’s
Compensation, a Participant’s eligibility for disability benefits and retirement benefits;



(c) To decide and resolve any disputes which may arise relative to the rights of Employees,
current and former, and their Beneficiaries, under the terms of the Plan, except to the extent that
the claims procedure set forth herein shall authorize any other person or party to determine or
review claims of Participants or Beneficiaries.



(d) To provide the Trustee with such directions and instructions as may be necessary to carry
out the terms of the Plan.



(e) To maintain all Plan records and relevant data, including Employee data relating to Hours
of Service, other than those required to be maintained by the Trustee.



(f) If all or any part of a Participant’s Compensation received from the Employer is
determined to be unreasonable in amount by the Internal Revenue Service, the Administrator shall be
empowered and authorized to adjust the Employer’s contribution, which is based on the unreasonable
Compensation, in any manner permitted by Revenue Ruling 67-341, and subsequent rulings, regulations
and laws pertaining thereto; or, in the alternative, the Administrator shall be empowered and
authorized to reallocate the contribution among other Participants in any manner permitted by
Revenue Ruling 67-341, and subsequent rulings, regulations and laws pertaining thereto.



(g) To make allocations of contributions, earnings, losses and forfeitures among Participants,
from year to year.



(h) To provide appropriate parties, including government agencies, with such returns, reports,
schedules, descriptions and individual statements as are required by law within the times
prescribed by law; and to furnish to the Employer, upon request, copies of any or all such
materials, and further, to make copies of such instruments, reports and descriptions as are
required by law available for examination by Participants and such of their Beneficiaries who are
or may be entitled to benefits under the Plan in such places and in such manner as required by law.



(i) To ascertain from the Employer the eligible Employees who shall become Participants in the
Plan and the Participants who have terminated employment.


 


IV-1









 





(j) To communicate with each eligible Employee and inform him of the existence of the Plan and
its pertinent provisions and to make certain that such additional disclosure requirements which may
be imposed by the Department of Labor or the Department of Treasury are carried out.



(k) To give necessary instructions and directions to the Trustee to assure the payment of
benefits to any Participant or his Beneficiary, at such time as the Participant or Beneficiary may
become entitled thereto.



(l) To give appropriate instructions and directions to the Trustee where any Participant
terminates his participation under the Plan or ceases to be entitled to benefits.



(m) To make certain that all benefits are paid to a Participant or his Beneficiary in
accordance with the terms and provisions of this Plan.




(n) To hire persons to provide necessary services to the Plan.



(o) To issue directions to the Trustee to pay any fees, taxes, charges or other costs
incidental to the operation and management of the Plan.




(p) To comply with all disclosure requirements imposed by state or federal law.



4.2 Employer as Administrator. If the Administrator is the Employer, then the Administrator shall only act by and through
the Board in accordance with the authority of the Board as provided under the Articles and by-laws
of the Employer. In such event, the action of the Administrator shall be deemed to be the action
of the entire Board, and not the action of any individual member thereof. Any documents, reports,
forms or returns, which are to be executed by the Administrator, shall be executed by a member of
the Board who is so authorized, and the execution thereof shall be deemed to be made on behalf of
the entire Board and not by that individual Board member.



4.3 Administrative Records. The records of the Administrator and of all its proceedings and acts shall be made a part
of the records and minutes of the Board.



4.4 Bonding of the Administrator. Bonding shall be made in accordance with Act Section 412 of ERISA.



 


IV-2









 




4.5 Non-Discriminatory Administration. Wherever under the provisions of this Plan discretion is granted to the Administrator,
which shall affect the benefits, rights and privileges of Participants or their Beneficiaries under
this Plan, such discretion shall be exercised uniformly so that all Participants or Beneficiaries
similarly situated shall be similarly treated.



4.6 Terminated Participant Statement. The Administrator shall furnish to each Participant who during a Plan Year has separated
from the service of the Employer, or who is entitled to a deferred vested benefit under the Plan as
of the end of such Plan Year, and with respect to whom retirement benefits were not paid under the
Plan during such Plan Year, an individual statement setting forth the following: (a) the name of
the Plan; (b) the name and address of the Plan Administrator; (c) the nature, amount and form of
the deferred vested benefit to which such Participant is entitled; and (d) such additional
information as the Secretary of the Treasury or his delegate may require. Such statement shall be
furnished by the Administrator within such period after the end of a Plan Year as prescribed by the
Secretary of the Treasury in Regulations.



4.7 Delegation by Administrator. The Administrator may delegate to the Trustee or any other agent, advisor or consultant any
of its functions, particularly those set forth in ARTICLE VII hereinbelow.



[End of Page]




 


IV-3









 







ARTICLE V




PARTICIPATION OF EMPLOYEES





5.1 Requirements.



(a) Except as provided in (c) below, each Employee who was a Participant on December 31, 2008,
shall continue to participate under the terms of this amended and restated Plan.



(b) Except as provided in (c) below, each Employee who was not a Participant on December 31,
2008, shall participate under the terms of this Plan commencing with the Eligibility Date next
following the date on which he completes one (1) Year of Service; provided, however, that for
purposes of the Elective Deferral portion of the Plan, an Employee shall participate commencing
with his Employment Commencement Date.




(c) The following Employees shall not be eligible to participate in the Plan:




(i) Members of a Collective Bargaining Unit




(ii) Leased Employees



(iii) Independent Contractors. For purposes of this Section, “Independent Contractor” shall
mean an individual who performs services for the Employer pursuant to an agreement, contract or
arrangement under which said individual is designated or classified as an independent contractor,
consultant or any category or classification other than an Employee. Individuals treated by the
Employer as Independent Contractors shall be excluded even if a court or administrative agency
determines that such designation or classification was in error.




5.2 Re-Hired Employees.



(a) A former Participant who is later rehired shall participate immediately upon reemployment,
provided, however, that if such former Participant was not Vested in his Accrued Benefit derived
from Employer Contributions (and who had made no Elective Deferrals) and if the number of his
consecutive 1-year Breaks In Service equals or exceeds the greater of five (5) or the aggregate
number of Years of Service before such Breaks, he must satisfy the eligibility requirements set
forth in Section 5.1.



(b) If an Employee terminates employment after meeting the eligibility requirements of Section
5.1 but prior to his first Eligibility Date, and if such Employee is later rehired by the Employer
without having incurred a Break in Service, such Employee shall participate immediately upon his
return. If such Employee has incurred a Break in Service, he shall participate immediately upon
his return, provided, however, that if the number of the Employee’s consecutive 1-year Breaks In
Service equals or exceeds the greater of five (5) or the aggregate number of Years of Service
before such Breaks, he must satisfy the eligibility requirements set forth in Section 5.1.



(c) If an Employee terminates employment prior to meeting the eligibility requirements of
Section 5.1 and is later rehired by the Employer, such Employee’s prior service shall count toward
satisfying the requirements of Section 5.1, provided, however, that if the number of the Employee’s
consecutive 1-year Breaks In Service equals or exceeds the greater of five (5) or the aggregate
number of Years of Service before such Breaks, he must satisfy the eligibility requirements set
forth in Section 5.1.


 


V-1









 






5.3 Participation Upon Return to Eligible Class.



(a) In the event a Participant is no longer a member of an eligible class of Employees and
becomes ineligible to participate but has not incurred a Break in Service, such Employee will
participate immediately upon returning to an eligible class of Employees. If such Participant
incurs a Break in Service, eligibility will be determined under the Break in Service rules of the
Plan.



(b) In the event an Employee who is not a member of an eligible class of Employees becomes a
member of an eligible class, such Employee will participate immediately if such Employee would have
otherwise previously become a Participant.



5.4 Participation Agreement. Within ninety (90) days after becoming eligible to
participate in the Plan, each Participant may be required to execute a written statement, on a form
or forms to be furnished by the Administrator, wherein he shall evidence (a) his designation of a
Beneficiary or Beneficiaries to receive any benefits payable under the Plan; and (b) his consent to
be bound by all the terms and conditions of this Plan and the Trust Agreement and all amendments
thereto. This procedure shall be applied in a nondiscriminatory manner.



5.5 Leave of Absence. A Participant’s employment is not considered terminated for
purposes of the Plan while he is on leave of absence with the consent of the Employer, provided
that he returns to the employ of the Employer at the expiration of such leave. Leaves of absence
shall mean leaves granted by the Employer, in accordance with established rules uniformly applied
to all Employees, for reasons of health or public service, for reasons set forth under the Family
and Medical Leave Act of 1993, or for reasons determined by the Employer to be in its best
interests. The taking of leave under this Section 5.5 shall not result in the loss of any benefit
accrued under the Plan prior to the date on which the leave commenced. A Participant’s employment
shall also not be deemed to have terminated while he is a member of the Armed Forces of the United
States, provided that he returns to the employment of the Employer within ninety (90) days (or such
longer period as may be prescribed by law) from the date he first became entitled to his discharge.
Participants who do not return to the employ of the Employer within sixty (60) days following the
end of the leave of absence, or within the required time in case of service with the Armed Forces,
shall be deemed to have terminated their employment as of the date when their leaves of absence
began, unless such failure to return was the result of Normal Retirement, deferred retirement,
Disability or death.



[End of Page]





 


V-2









 







ARTICLE VI




CONTRIBUTIONS





6.1 Employer Contributions: Types and Amounts.



(a) Discretionary Employer Contributions. From time to time during the continuance of
this Plan, the Employer may make Discretionary Employer Contributions in cash or in-kind to the
Trust Fund in an amount determined by the Board, on or before the date prescribed in the Code for
the filing of the Employer’s Federal Income Tax Return, including extensions thereof, for the
Taxable Year of the Employer for which the contribution is made. In-kind contributions shall be
discretionary and unencumbered.



(b) Employer Matching Contributions. Effective July 1, 2009, and subject to the
Actual Contribution Percentage limitations hereinbelow, the Employer may make Employer Matching
Contributions in an amount equal to a discretionary amount determined by the Board. Such amount
shall be a percentage of the amount a Participant elects to defer, and the Employer may limit the
match to a portion of the amount deferred. Any deferrals over such a limit shall be unmatched
deferrals.



Such contribution shall be paid in cash to the Trust Fund on or before the date prescribed in the
Code for the filing of the Employer’s Federal Income Tax Return, including extensions thereof, for
the Taxable Year of the Employer for which the contribution is made.



(c) Enhanced Match Safe Harbor Contribution. The Plan was timely amended to suspend
the Safe Harbor Matching Contribution effective June 30, 2009. For the period beginning January 1,
2009 and ending June 30, 2009, the Employer shall make an Employer Matching Contribution to the
account of each eligible Participant in an amount equal to 100% of the first four percent (4%) of
Compensation a Participant elects to defer, plus fifty percent (50%) of the Employee’s Elective
Deferrals thereafter, but no Employer Matching Contributions will be made on Elective Deferrals
that exceed six percent (6%) of Compensation. Catch-up Contributions (described in Section 6.3(b)
below) shall be included in the deferrals to which the Safe Harbor Employer Matching Contribution
applies. Safe-Harbor Contributions shall:




(i) Be fully vested at all times;



(ii) Be made on behalf of all eligible Participants, without regard to any requirement that a
Participant complete one thousand (1,000) Hours of Service or be employed on the Anniversary Date
of the Plan Year for which the contribution is made;




(iii) Be subject to the withdrawal restrictions described in Section 8.1 hereinbelow;



(iv) Not be required for Participants who have not completed a Year of Service (i.e., eligible
for the Employer Matching Contribution portion of the Plan). Such Participants shall be treated
separately for coverage purposes pursuant to Section 410(b)(4), and Elective Deferrals made on
behalf of such Participants shall satisfy the Actual Deferral Percentage limitations described in
Section 6.5 hereinbelow; and




(v) Be subject to the Actual Contribution Percentage limitations hereinbelow.


 


VI-1









 





(d) Safe-Harbor Notice Requirements and Election Periods. At least 30 days, but not
more than 90 days, before the beginning of the Plan Year, the Employer will provide each eligible
Employee a comprehensive notice of the Employee’s rights and obligations under the Plan, written in
a manner calculated to be understood by the average eligible Employee. If an Employee becomes
eligible after the 90th day before the beginning of the Plan Year and does not receive the notice
for that reason, the notice must be provided no more than 90 days before the Employee becomes
eligible but not later than the date the Employee becomes eligible. In addition to any other
election periods provided under the plan, each eligible Employee may make or modify a deferral
election during the 30-day period immediately following receipt of the notice described in this
subparagraph.




(e) Flexibility for Plans Using Safe Harbor Matching Contribution Method.
The Employer may amend the Plan to suspend future Safe-Harbor Matching Contributions for the Plan
Year and utilize current year ADP/ACP testing for the entire Plan Year. The Employer will provide
a supplemental notice to all eligible Employees informing them of the consequences and effective
date of any reduction or elimination of Safe Harbor Matching Contributions and that they will have
a reasonable opportunity and time period prior to the reduction or elimination to change their cash
or deferred elections. The reduction or elimination of Safe Harbor Matching Contributions shall be
effective no earlier than the later of: (1) thirty (30) days after the notice is issued, and (2)
the date the amendment is adopted.



(f) Elective Deferrals as Employer Contributions. Contributions made pursuant to
Section 6.2 hereinbelow, unless otherwise specifically provided in the Code or Treasury
regulations, are treated as a contribution of the Employer for Sections 401(a), 401(k), 404, 411,
415, 416 and 417 of the Code.



6.2 Elective Deferrals: Amounts and Procedures. Elective Deferrals shall be
accumulated through payroll deductions and shall be paid to the Trustee with reasonable promptness
but not later than the 15th business day of the month following the month in which such amounts
would otherwise have been made payable to the Participant in cash. Elective Deferrals shall be
made as follows:



(a) Subject to the limitations in Section 6.3, 6.5, 6.6 and 7.4 hereinbelow, each Participant
may elect to defer a portion of his Compensation by directing the Employer in a salary reduction
agreement to withhold such contribution through payroll deduction.



(b) The Employer and Administrator shall adopt procedures necessary to implement all
arrangements for the election and payment of Elective Deferrals. Participants must be given an
effective opportunity to commence, modify or terminate such Elective Deferrals as often as the
Administrator determines, but not less frequently than annually. Participant elections described
in this subparagraph must be made before the Compensation to be deferred becomes currently
available to the Employee and may not be applied retroactively.




6.3 Elective Deferral Dollar Limitations.



(a) No Participant shall be permitted to have Elective Deferrals made under this Plan, or any
other qualified plan maintained by the Employer during any taxable year, in excess of the dollar
limitation contained in Section 402(g) of the Code in effect for such taxable year, except to the
extent permitted under subparagraph (b) below and section 414(v) of the Code, if applicable.


 


VI-2









 





(b) An Employee who is eligible to make Elective Deferrals under this Plan and who has
attained age 50 before the close of his taxable year shall be eligible to make catch-up
contributions in accordance with, and subject to the limitations of, Section 414(v) of the Code.
Such catch-up contributions shall not be taken into account for purposes of the provisions of the
Plan implementing the required limitations of Sections 402(g) and 415 of the Code. The Plan shall
not be treated as failing to satisfy the provisions of the Plan implementing the requirements of
Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by reason of
the making of such catch-up contributions.



(c) “Excess Deferrals” shall mean those Elective Deferrals that are includible in a
Participant’s gross income under Code Section 402(g) to the extent such Participant’s Elective
Deferrals for a taxable year exceed the dollar limitation under such Code Section, including, if
applicable, the dollar limitation on Catch-up Contributions defined in Section 414(v) of the Code.



(d) In the event the limitation set forth in this paragraph is exceeded, one of the following
actions shall be taken:



(i) Distribution After Taxable Year. By March 1 of the year following the close of
his taxable year, the Participant must notify the Plan Administrator in writing of the excess and
the amount of the excess to be allocated to the Plan. The Participant is deemed to have notified
the Plan of excess deferrals to the extent such Participant has excess deferrals for the taxable
year calculated by taking into account only elective deferrals under the Plan and other plans of
the Employer. Under such circumstances, the Employer may notify the Plan on behalf of the
Participant. Notwithstanding any other provision of the Plan, and provided notification has been
given in accordance with this subparagraph, the excess amount (adjusted for gains/losses) shall be
distributed to the Participant no later than April 15 following the close of the Participant’s
taxable year in which the excess deferral occurred.



(ii) Distribution During Taxable Year. A Participant may receive a corrective
distribution of excess deferrals during the same taxable year in which the excess deferral
occurred, provided the Participant and the Plan designate the distribution as an excess deferral,
and the correcting distribution is made after the date on which the Plan received the excess
deferral.



(iii) Retention in Plan. Excess Deferrals which are not distributed on or before
April 15 following the close of the Participant’s taxable year shall remain in the Plan until such
time that distributions are otherwise allowed in accordance with the terms and provisions of
ARTICLE VIII hereinbelow.



(e) Determination of income or loss: Excess Deferrals shall be adjusted for any income or
loss for the taxable year of the Participant. The Plan Administrator shall not calculate nor
distribute allocable income for the Gap Period.



6.4 Non-deductible Employee Contributions. A Participant shall not be required nor
permitted to make nondeductible contributions to the Trust Fund.


 


VI-3









 






6.5 Actual Deferral Percentage Limitations.



(a) The Actual Deferral Percentage (“ADP”) for a Plan Year for Participants who are Highly
Compensated Employees for each Plan Year and the current year’s ADP for Participants who were
Non-highly Compensated Employees for the current Plan Year must satisfy one of the following tests:



(i) The ADP for a Plan Year for participants who are Highly Compensated Employees for the Plan
Year shall not exceed the current year’s ADP for Participants who were Non-highly Compensated
Employees for the current Plan Year multiplied by 1.25; or



(ii) The ADP for a Plan Year for Participants who are Highly Compensated Employees for the
Plan Year shall not exceed the current year’s ADP for Participants who were Non-highly Compensated
Employees for the current Plan Year multiplied by 2.0, provided that the ADP for Participants who
are Highly Compensated Employees does not exceed the ADP for Participants who were Non-highly
Compensated Employees in the current Plan Year by more than 2 percentage points.



(b) Safe Harbor. If Section 6.1 is amended to reinstate the Safe Harbor
Contributions, the Plan shall automatically meet the Actual Deferral Percentage test described in
6.5(a) above.



(c) Corrective Measures (non-Safe Harbor years). In the event the Actual Deferral
Percentage for Highly Compensated Employees does not satisfy the test set forth in subparagraph (a)
hereinabove, the Administrator shall utilize one or more of the following corrective measures with
respect to Excess Contributions:



(i) Distributions. Excess Contributions (adjusted for any income or loss) that are
specifically designated as such by the Employer may be distributed to the appropriate Highly
Compensated Employees within two and one-half (2-1/2) months after the close of the Plan Year for
which such Excess Contributions were made. The amount of Excess Contributions for a Highly
Compensated Employee is determined in the following manner: (1) the actual deferral ratio (ADR) of
the Highly-Compensated Employee with the highest ADR is reduced to the extent necessary to satisfy
the actual deferral percentage (ADP) test or cause such ratio to equal the ADR of the
Highly-Compensated Employee with the next highest ratio; (2) the process is repeated until the ADP
test is satisfied. The total dollar amount of Excess Contributions is equal to the sum of the
above reductions multiplied, in each case, by the Highly-Compensated Employee’s Compensation. The
amount of Excess Contributions to be distributed shall be determined on the basis of the amount of
contributions made by each Highly-Compensated Employee, taking into account those Excess
Contributions attributable first to the Highly-Compensated Employees who have the greatest dollar
amount of elective deferrals. The following additional provisions apply to distributions under
this subparagraph (c)(i):



(A) Distributions may be postponed but not later than the close of the Plan Year following the
Plan Year for which such Excess Contributions were made. Distributions that are postponed pursuant
to the preceding sentence shall cause the Employer to be subject to the excise tax imposed by Code
Section 4979.



(B) Excess Contributions shall be distributed from a Participant’s Elective Deferral Account
and Qualified Employer Matching Contribution Account (if applicable) in proportion to his Elective
Deferrals and Qualified Employer Matching Contribution Account (to the extent used in the Actual
Deferral Percentage test) for the Plan Year. Excess Contributions shall be distributed from the
Participants Qualified Discretionary Employer Contribution Account only to the extent that such
Excess Contributions exceed the balance in the Participant’s Elective Deferral Account and
Qualified Employer Matching Contribution Account.



(C) Determination of income or loss: Excess Contributions shall be adjusted for any income or
loss for the Plan Year. The Plan Administrator shall not calculate nor distribute allocable income
for the Gap Period.


 


VI-4









 





(D) If, pursuant to Section 6.3 above, Excess Deferrals have been distributed for the
Employee’s taxable year ending with or within the Plan Year, the Plan shall offset such
distribution from the amount of such Employee’s Excess Contributions to be distributed for such
Plan Year. The amount of Excess Deferrals that may be distributed by the Plan for a taxable year
of the Employee must be reduced by the amount of Excess Contributions previously distributed for
the Plan Year beginning with or within that taxable year.



(ii) Additional Contributions. Within twelve (12) months after the end of the Plan
Year, the Employer may make a Qualified Employer Matching Contribution or a Qualified Discretionary
Employer Contribution on behalf of Non-Highly Compensated Employees in an amount sufficient to
satisfy the test set forth in subparagraph (b) hereinabove. Such contribution shall be allocated
to the Qualified Discretionary Employer Contribution Account or Qualified Matching Employer
Contribution Account of each Non-Highly Compensated Employee on the same basis on which such
Employer contributions are made. Additional contributions under this subparagraph shall meet the
additional requirements of Section 1.401(k)-2(a)(6) of the regulations, which are incorporated
herein by reference.



(d) If a Highly Compensated Employee participates in two or more cash or deferred arrangements
of the same Employer but with different plan years, each plan must be tested with all Elective
Deferrals (and any other contributions taken into account in calculating the deferral ratio for
such Employee) made to each plan in each plan year. If the cash or deferred arrangements have the
same plan year, all such contributions are treated as being made under the plan being tested.
Notwithstanding the foregoing, certain plans shall be treated as separate if mandatorily
disaggregated under regulations promulgated under Section 401(k) of the Code.



(e) Plans may be aggregated in order to satisfy Section 401(k) of the Code only if such plans
have the same Plan Year and use the same Actual Deferral Percentage testing method (prior year or
current year). To determine whether the Plan satisfies the Actual Deferral Percentage Test, all
Elective Deferrals made under two or more plans aggregated under Section 401(a)(4) or 410(b) of the
Code (other than Section 410(b)(2)(A)(ii)) will be treated as made under a single plan.
Furthermore, if two or more plans are permissively aggregated for purposes of Section 401(k), the
aggregated plans must also satisfy Sections 401(a)(4) and 410(b) as though they were a single plan.



(f) The Employer shall maintain records sufficient to demonstrate satisfaction of the Actual
Deferral Percentage test.




6.6 Actual Contribution Percentage Limitations.



(a) The Actual Contribution Percentage (“ACP”) for a Plan Year for Participants who are Highly
Compensated Employees for each Plan Year and the current year’s ACP for Participants who were
Non-highly Compensated Employees for the current Plan Year must satisfy one of the following tests:



(i) The ACP for a Plan Year for participants who are Highly Compensated Employees for the Plan
Year shall not exceed the current year’s ACP for Participants who were Non-highly Compensated
Employees for the current Plan Year multiplied by 1.25; or



(ii) The ACP for a Plan Year for Participants who are Highly Compensated Employees for the
Plan Year shall not exceed the current year’s ACP for Participants who were Non-highly Compensated
Employees for the current Plan Year multiplied by 2.0, provided that the ACP for Participants who
are Highly Compensated Employees does not exceed the ACP for Participants who were Non-highly
Compensated Employees in the current Plan Year by more than 2 percentage points.


 


VI-5









 





(b) Safe Harbor. If Section 6.1 is amended to reinstate the Safe Harbor
Contributions, the Plan shall automatically meet the Actual Contribution Percentage test described
in 6.6(a) above.



(c) Corrective Measures (non-Safe Harbor years). In the event the Actual Contribution
Percentage for Highly Compensated Employees does not satisfy the test set forth in subparagraph (a)
hereinabove, the Administrator shall utilize one or more of the following corrective measures with
respect to Excess Aggregate Contributions:



(i) Additional Contributions. Within twelve (12) months after the end of the Plan
Year, the Employer may make a Qualified Discretionary Employer Contribution on behalf of Non-Highly
Compensated Employees in an amount sufficient to satisfy the test set forth in subparagraph (a)
hereinabove. Such contribution shall be allocated to the Qualified Discretionary Employer
Contribution Account of each Non-Highly Compensated Employee on the same basis on which such
Employer contributions are made. All contributions under this subparagraph shall meet the
additional requirements of Section 1.401(m)-2(a)(6) of the regulations, which are incorporated
herein by reference.



(ii) Distributions and Forfeitures. Excess Aggregate Contributions (adjusted for any
income or loss) that are specifically designated as such by the Employer may be forfeited, if
forfeitable, or may be distributed to the appropriate Highly Compensated Employees within two and
one-half (2-1/2) months after the close of the Plan Year for which such Excess Aggregate
Contributions were made. The amount of Excess Aggregate Contributions is determined in the
following manner: (1) the actual contribution ratio (ACR) of the Highly-Compensated Employee with
the highest ACR is reduced to the extent necessary to satisfy the actual contribution percentage
(ACP) test or cause such ratio to equal the ACR of the Highly-Compensated Employee with the next
highest ratio; (2) the process is repeated until the ACP test is satisfied. The total dollar
amount of Excess Aggregate Contributions is equal to the sum of the above reductions multiplied, in
each case, by the Highly-Compensated Employee’s Compensation. The amount of Excess Aggregate
Contributions to be distributed shall be determined on the basis of the amount of contributions
made on behalf of each Highly-Compensated Employee, taking into account those Excess Aggregate
Contributions attributable first to the Highly-Compensated Employees who have the greatest dollar
amount of Employer Matching Contributions.



(iii) Amounts shall be forfeited or distributed, as applicable, on a pro rata basis from the
Participant’s Employer Matching Contribution Account and Qualified Employer Matching Contribution
Account (and if applicable, the Participant’s Qualified Discretionary Employer Contribution Account
or Elective Deferral account, or both), but only to the extent not used in the Actual Deferral
Percentage test. Amounts forfeited by Highly Compensated Employees under this Section shall be
allocated or applied in accordance with Section 9.3, provided that no forfeitures arising under
this Section shall be allocated to the Account of any Highly Compensated Employee.



(iv) Distributions and forfeitures under this Section may be postponed but not later than the
close of the Plan Year following the Plan Year for which such Excess Contributions were made.
Distributions and/or forfeitures that are postponed pursuant to the preceding sentence shall cause
the Employer to be subject to the excise tax imposed by Code Section 4979.



(v) Determination of income or loss: Excess Aggregate Contributions shall be adjusted for any
income or loss for the Plan Year. The Plan Administrator shall not calculate nor distribute
allocable income for the Gap Period.


 


VI-6









 





(d) If a Highly Compensated Employee participates in two or more cash or deferred arrangements
of the same Employer but with different plan years, each plan must be tested with all Employer
Matching Contributions (and any other contributions taken into account in calculating the
contribution ratio for such Employee) made to each plan in each plan year. If the cash or deferred
arrangements have the same plan year, all such contributions are treated as being made under the
plan being tested. Notwithstanding the foregoing, certain plans shall be treated as separate if
mandatorily disaggregated under regulations promulgated under Section 401(m) of the Code.



(e) Plans may be aggregated in order to satisfy Section 401(m) of the Code only if such plans
have the same Plan Year and use the same Actual Contribution Percentage testing method (prior year
or current year). To determine whether the Plan satisfies the Actual Contribution Percentage Test,
all Employer Matching Contributions and non-deductible Employee Contributions (if any) made under
two or more plans aggregated under Section 401(a)(4) or 410(b) of the Code (other than Section
410(b)(2)(A)(ii)) will be treated as made under a single plan. Furthermore, if two or more plans
are permissively aggregated for purposes of Section 401(m), the aggregated plans must also satisfy
Sections 401(a)(4) and 410(b) as though they were a single plan.



(f) The Employer shall maintain records sufficient to demonstrate satisfaction of the Average
Contribution Percentage test.



(g) If the testing method (prior year or current year) used for the Actual Contribution
Percentage test differs from the testing method used for the Actual Deferral Percentage test,
Elective Deferrals may not be used in meeting the requirements of the Actual Contribution
Percentage test and Qualified Matching Contributions may not be used in meeting the requirements
the Actual Deferral Percentage test.



6.7 Additional Contribution to Restore Cashed-Out Benefits. In the event a
Participant who has received a distribution of his Vested Accrued Benefit under Section 9.2
hereinbelow, and who is subsequently reemployed by the Employer, repays the amount of such
distribution as required by Section 9.2, the Employer shall, upon such repayment, make a
contribution to such Participant’s Account(s) in an amount equal to the part of such Account(s)
which was forfeited.



[End of Page]





 


VI-7









 







ARTICLE VII




ALLOCATIONS AND ADJUSTMENTS TO ACCOUNTS




7.1 Procedure. The balance in each Participant’s Accounts, less in-service
withdrawals for that Plan Year, shall be determined as of the first day of each Plan Year. After
such balance has been determined, adjustments and allocations shall be made to each account by the
Administrator, as of each Anniversary Date or other Valuation Date (collectively referred to in
this Section 7.1 as “Valuation Date”), according to the following procedure:



(a) The earnings, losses and increases or decreases in the investments elected by each
Participant pursuant to ARTICLE XII shall be determined on a daily basis and allocated to each
active and Inactive Participant’s account(s).



(b) As of each Valuation Date, Employer Matching Contributions shall be allocated to each
Participant’s Employer Matching Contribution Account in an amount contributed on his behalf
pursuant to Section 6.1 hereinabove.



(c) As of each Valuation Date, Elective Deferrals made pursuant to Sections 6.1 and 6.2
hereinabove shall be allocated to each Participant’s Elective Deferral Account(s) in an amount
equal to such Elective Deferrals.



(d) If a Participant has forfeited all or part of his Accrued Benefit, pursuant to ARTICLE IX,
his account(s) which included the part forfeited shall be reduced by the amount of such forfeiture.



(e) Discretionary Employer contributions plus forfeitures for the Plan Year shall be allocated
to the Discretionary Employer Contribution Account of each Participant who is to share in such
allocation, as provided in Section 7.2 in the proportion that the Compensation of each such
Participant bears to the Compensation of all Participants.




7.2 Accrual of Contributions.



(a) Except as provided in Section 7.2(b) and 7.2(c) hereof, a Participant shall share in
Discretionary Employer Contributions, Employer Matching Contributions and forfeitures only if he is
employed by the Employer on the Anniversary Date of the Plan Year for which the contribution is
made and, effective January 1, 2010, has completed one thousand (1,000) Hours of Service with the
Employer during such Plan Year. This subparagraph shall not apply to Safe Harbor Contributions.



(b) A contribution shall be allocated to a retired, deceased or disabled Participant, or a
Participant on leave of absence, for the year in which he attains his Normal Retirement Age (or, if
he continues to be employed by the Employer, the year in which he separates from service after
attainment of Normal Retirement Age), dies or becomes disabled, or is on leave of absence, without
regard to the requirements that he complete one thousand (1,000) Hours of Service and be employed
on the Anniversary Date of the Plan Year for which the contribution is made.



(c) In the event the Plan is determined to be a Top-Heavy Plan as defined in Section 10.2 for
any Plan Year, a contribution (as determined in Section 10.1) of up to three percent (3%) of a
Participant’s Compensation (for the full Plan Year for which the contribution is made) shall be
allocated to each non-key employee who is a Participant for such Plan Year even though such
Participant fails to complete one thousand (1,000) Hours of Service during such Plan Year, provided
such Participant is employed on the Anniversary Date of such Plan Year.


 


VII-1









 





7.3 Accounts. The Administrator shall maintain for each Participant the appropriate
accounts to receive and hold contributions made on the Participant’s behalf. In the case of a
Participant to whom Section 9.4(c) is applicable, the Administrator shall divide the Participant’s
accounts subject to Section 9.4(c) into separate sub-accounts for pre-break Accrued Benefits and
post-break Accrued Benefits. Each account shall consist of contributions and forfeitures allocable
to such Participant and the earnings, losses, expenses, and increases or decreases in the fair
market value of the Trust Fund attributable to the account.



7.4 Limitations on Annual Additions. Except to the extent permitted under Section
6.3(b) (Catch up Contributions) of this Plan and Section 414(v) of the Code, the annual addition
that may be contributed or allocated to a Participant’s account under the Plan for any Limitation
Year shall not exceed the maximum permissible amount. If the Employer contributions that would
otherwise be contributed or allocated to the Participant’s account would cause the annual additions
for the Limitation Year to exceed the maximum permissible amount, the amount contributed or
allocated will be reduced so that the annual additions for the Limitation Year will equal the
maximum permissible amount, which is the lesser of:



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



(b) 100 percent of the Participant’s Section 415 Compensation for the Limitation Year. The
compensation limit referred to in (ii) shall not apply to any contribution for medical benefits
after separation from service (within the meaning of section 401(h) or section 419A(f)(2) of the
Code) which is otherwise treated as an annual addition.




7.5 Definition of Annual Additions. 



(a) Annual Addition Defined. For purposes of this Section and unless as otherwise
provided, the term “annual addition” shall mean the sum for any Limitation Year of (1) Employer
contributions, (2) Elective Deferrals, (3) forfeitures, (4) amounts attributable to post-retirement
medical benefits allocated to an account of a key employee established pursuant to Section 419A(d)
of the Code, under a welfare benefit fund, as defined in Section 419(e) of the Code, and (5)
amounts allocated to an individual medical account, as defined in Section 415(l)(2), which is part
of a pension or annuity plan maintained by the Employer.



(b) Treatment of Excess Deferrals and Excess Contributions. Contributions do not fail
to be annual additions merely because they are excess deferrals, excess contributions or excess
aggregate contributions or merely because excess contributions or excess aggregate contributions
are corrected through distribution. Excess deferrals that are distributed in accordance with
Section 6.3 hereinabove are not annual additions.


 


VII-2









 





(c) Restorative Payments. Annual additions for purposes of Code §415 shall not
include restorative payments. A restorative payment is a payment made to restore losses to a Plan
resulting from actions by a fiduciary for which there is reasonable risk of liability for breach of
a fiduciary duty under ERISA or under other applicable federal or state law, where participants who
are similarly situated are treated similarly with respect to the payments. Generally, payments are
restorative payments only if the payments are made in order to restore some or all of the plan’s
losses due to an action (or a failure to act) that creates a reasonable risk of liability for such
a breach of fiduciary duty (other than a breach of fiduciary duty arising from failure to remit
contributions to the Plan). This includes payments to a plan made pursuant to a Department of Labor
order, the Department of Labor’s Voluntary Fiduciary Correction Program, or a court-approved
settlement, to restore losses to a qualified defined contribution plan on account of the breach of
fiduciary duty (other than a breach of fiduciary duty arising from failure to remit contributions
to the Plan). Payments made to the Plan to make up for losses due merely to market fluctuations and
other payments that are not made on account of a reasonable risk of liability for breach of a
fiduciary duty under ERISA are not restorative payments and generally constitute contributions that
are considered annual additions.



(d) Other Amounts. Annual additions for purposes of Code § 415 shall not include: (1)
The direct transfer of a benefit or employee contributions from a qualified plan to this Plan; (2)
Rollover contributions (as described in Code §§401(a)(31), 402(c)(l), 403(a)(4), 403(b)(8),
408(d)(3), and 457(e)(16)); (3) Repayments of loans made to a participant from the Plan; and (4)
Repayments of amounts described in Code §41l(a)(7)(B) (in accordance with Code §41l(a)(7)(C)) and
Code §41l(a)(3)(D) or repayment of contributions to a governmental plan (as defined in Code
§414(d)) as described in Code §4l5(k)(3), as well as Employer restorations of benefits that are
required pursuant to such repayments.



7.6 Change of Limitation Year. The limitation year may only be changed by a Plan
amendment. Furthermore, if the Plan is terminated effective as of a date other than the last day of
the Plan’s limitation year, then the Plan is treated as if the Plan had been amended to change its
limitation year.



7.7 Excess Annual Additions. Notwithstanding any provision of the Plan to the
contrary, if the annual additions (within the meaning of Code §415) are exceeded for any
participant, then the Plan may only correct such excess in accordance with the Employee Plans
Compliance Resolution System (EPCRS) as set forth in Revenue Procedure 2006-27 or any superseding
guidance, including, but not limited to, the preamble of the final §415 regulations.




7.8 Aggregation and Disaggregation of Plans.



(a) General Application. For purposes of applying the limitations of Code §415, all
defined contribution plans (without regard to whether a plan has been terminated) ever maintained
by the Employer (or a “predecessor employer”) under which the participant receives annual additions
are treated as one defined contribution plan. The “Employer” means the Employer that adopts this
Plan and all members of a controlled group or an affiliated service group that includes the
Employer (within the meaning of Code §§414(b), (c), (m) or (o)), except that for purposes of this
Section, the determination shall be made by applying Code §415(h), and shall take into account
tax-exempt organizations under Regulation Section 1.414(c)-5, as modified by Regulation Section
1.415(a)-1(f)(1). For purposes of this Section:



(i) A former Employer is a “predecessor employer” with respect to a participant in a plan
maintained by an Employer if the Employer maintains a plan under which the participant had accrued
a benefit while performing services for the former Employer, but only if that benefit is provided
under the plan maintained by the Employer. For this purpose, the formerly affiliated plan rules in
Regulation Section 1.415(f)-1(b)(2) apply as if the Employer and predecessor Employer constituted a
single employer under the rules described in Regulation Section 1.415(a)-1(f)(1) and (2)
immediately prior to the cessation of affiliation (and as if they constituted two, unrelated
employers under the rules described in Regulation Section 1.415(a)-1(f)(1) and (2) immediately
after the cessation of affiliation) and cessation of affiliation was the event that gives rise to
the predecessor employer relationship, such as a transfer of benefits or plan sponsorship.


 


VII-3









 





(ii) With respect to an Employer of a participant, a former entity that antedates the Employer
is a “predecessor employer” with respect to the participant if, under the facts and circumstances,
the employer constitutes a continuation of all or a portion of the trade or business of the former
entity.



(b) Break-up of an Affiliate Employer or an Affiliated Service Group. For purposes of
aggregating plans for Code §415, a “formerly affiliated plan” of an employer is taken into account
for purposes of applying the Code §415 limitations to the employer, but the formerly affiliated
plan is treated as if it had terminated immediately prior to the “cessation of affiliation.” For
purposes of this paragraph, a “formerly affiliated plan” of an employer is a plan that, immediately
prior to the cessation of affiliation, was actually maintained by one or more of the entities that
constitute the employer (as determined under the employer affiliation rules described in Regulation
Section 1.415(a)-1(f)(1) and (2)), and immediately after the cessation of affiliation, is not
actually maintained by any of the entities that constitute the employer (as determined under the
employer affiliation rules described in Regulation Section 1.415(a)-1(f)(1) and (2)). For purposes
of this paragraph, a “cessation of affiliation” means the event that causes an entity to no longer
be aggregated with one or more other entities as a single employer under the employer affiliation
rules described in Regulation Section 1.415(a)-1(f)(l) and (2) (such as the sale of a subsidiary
outside a controlled group), or that causes a plan to not actually be maintained by any of the
entities that constitute the employer under the employer affiliation rules of Regulation Section
1.415(a)-1(f)(1) and (2) (such as a transfer of plan sponsorship outside of a controlled group).



(c) Midyear Aggregation. Two or more defined contribution plans that are not required
to be aggregated pursuant to Code §415(f) and the Regulations thereunder as of the first day of a
limitation year do not fail to satisfy the requirements of Code §415 with respect to a participant
for the limitation year merely because they are aggregated later in that limitation year, provided
that no annual additions are credited to the participant’s account after the date on which the
plans are required to be aggregated.



7.9 Section 415 Compensation for Testing and Other Compliance Purposes. The
provisions of the Plan setting forth the definition of compensation for purposes of Code §415
(hereinafter referred to as “Section 415 Compensation”), as well as compensation for purposes of
determining highly compensated employees pursuant to Code §414(q) and for top-heavy purposes under
Code §416 (including the determination of key employees), shall be amended to read as follows:



(a) Notwithstanding anything herein to the contrary, the term “Section 415 Compensation” means
the generally applicable definition of compensation within the meaning of Section 415(c)(3) of the
Code, as defined in Treasury Regulation Section 1.415(c)-2(b) and -2(c), and any subsequent
guidance interpreting the generally applicable definition of compensation under Section 415(c)(3)
of the Code, as such definition shall be amended from time to time thereunder. “Section 415
Compensation” shall include (unless the Treasury Regulations, as amended from time to time, require
otherwise) remuneration for services of the following types:



(i) The Employee’s wages, salaries, fees for professional services, and other amounts received
(without regard to whether or not an amount is paid in cash) for personal services actually
rendered in the course of employment with the Employer, to the extent that the amounts are
includible in gross income (or to the extent amounts would have been received and includible in
gross income but for an election under section 125(a), 132(f)(4), 402(e)(3), 402(h)(1)(B), 402(k),
or 457(b)). These amounts include, but are not limited to, commissions paid to salespersons,
compensation for services on the basis of a percentage of profits, commissions on insurance
premiums, tips, bonuses, fringe benefits, and reimbursements or other expense allowances under a
non-accountable plan as described in §1.62-2(c).


 


VII-4









 





(ii) In the case of an Employee who is an employee within the meaning of section 401(c)(1) and
regulations promulgated under section 401(c)(1), the Employee’s earned income (as described in
section 401(c)(2) and regulations promulgated under section 401(c)(2)), plus amounts deferred at
the election of the Employee that would be includible in gross income but for the rules of section
402(e)(3), 402(h)(1)(B), 402(k), or 457(b).



(iii) Amounts described in section 104(a)(3), 105(a), or 105(h), but only to the extent that
these amounts are includible in the gross income of the Employee.



(iv) Amounts paid or reimbursed by the Employer for moving expenses incurred by an Employee,
but only to the extent that at the time of the payment it is reasonable to believe that these
amounts are not deductible by the Employee under section 217.



(v) The value of a nonstatutory option (which is an option other than a statutory option as
defined in §1.421-1(b)) granted to an Employee by the Employer, but only to the extent that the
value of the option is includible in the gross income of the Employee for the taxable year in which
granted.



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



(vii) Amounts that are includible in the gross income of an Employee under the rules of
section 409A or section 457(f)(1)(A) or because the amounts are constructively received by the
employee.



(b) “Section 415 Compensation” shall not include (unless the Treasury Regulations, as amended
from time to time, require otherwise) the following:



(i) Contributions (other than elective contributions described in section 402(e)(3), section
408(k)(6), section 408(p)(2)(A)(i), or section 457(b)) made by the Employer to a plan of deferred
compensation (including a simplified employee pension described in section 408(k) or a simple
retirement account described in section 408(p), and whether or not qualified) to the extent that
the contributions are not includible in the gross income of the Employee for the taxable year in
which contributed. In addition, any distributions from a plan of deferred compensation (whether or
not qualified) are not considered as compensation for section 415 purposes, regardless of whether
such amounts are includible in the gross income of the Employee when distributed.



(ii) Amounts realized from the exercise of a nonstatutory option (which is an option other
than a statutory option as defined in §1.421-1(b)), or when restricted stock or other property held
by an Employee either becomes freely transferable or is no longer subject to a substantial risk of
forfeiture (see section 83 and regulations promulgated under section 83).



(iii) Amounts realized from the sale, exchange, or other disposition of stock acquired under a
statutory stock option (as defined in §1.421-1(b)).



(iv) Other amounts that receive special tax benefits, such as premiums for group-term life
insurance (but only to the extent that the premiums are not includible in the gross income of the
Employee and are not salary reduction amounts that are described in section 125).



(v) Other items of remuneration that are similar to any of the items listed in paragraphs
(ii)(A) through (ii)(D) of this section.


 


VII-5









 





(c) “First Few Weeks” Rule. Section 415 Compensation for a limitation year shall
not include amounts earned but not paid during the limitation year solely because of the
timing of pay periods and pay dates.



7.10 Definition of Compensation for Contributions and Benefits. The provisions of the
Plan setting forth the definition of compensation for allocation purposes (hereinafter referred to
as “Plan Compensation”) shall not be affected by the provisions or adjustments that are
made to Section 415 Compensation in Section 7.9 above.



7.11 Section 415 Compensation Paid After Severance from Employment. Section 415
Compensation shall be adjusted, as set forth herein, for the following types of compensation paid
after a Participant’s severance from employment with the Employer maintaining the Plan (or any
other entity that is treated as the Employer pursuant to Code §414(b), (c), (m) or (o)). However,
amounts described below in this Section 7.11 may only be included in Section 415 Compensation to
the extent such amounts are paid by the later of 2-1/2 months after severance from employment or by
the end of the limitation year that includes the date of such severance from employment. Any other
payment of compensation paid after severance of employment that is not described in the following
types of compensation is not considered Section 415 Compensation within the meaning of Code
§415(c)(3), even if payment is made within the time period specified above.



(a) Regular pay. Section 415 Compensation shall include regular pay after severance
of employment if:



(i) The payment is regular compensation for services during the participant’s regular working
hours, or compensation for services outside the participant’s regular working hours (such as
overtime or shift differential), commissions, bonuses, or other similar payments; and



(ii) The payment would have been paid to the participant prior to a severance from employment
if the participant had continued in employment with the Employer.



(b) Leave cashouts. Leave cashouts shall be included in Section 415 Compensation if
those amounts would have been included in the definition of Section 415 Compensation if they were
paid prior to the participant’s severance from employment, and the amounts are payment for unused
accrued bona fide sick, vacation, or other leave, but only if the participant would have been able
to use the leave if employment had continued.



(c) No other types of post-severance compensation shall be included under this Section.
Examples of types of post-severance compensation that are not included are:




(i) Payments from nonqualified unfunded deferred compensation plans;




(ii) Salary continuation payments for participants on military service; and



(iii) Salary continuation payments to a participant who is permanently and totally disabled
(as defined in Code §22(e)(3).



7.12 Compensation Limit Application to 401(k) Plans. Participants may not make
elective deferrals with respect to amounts that are not Section 415 Compensation. However, for
this purpose, Section 415 Compensation is not limited to the annual compensation limit of Code
§401(a)(l7); that is, the Plan is not required to determine a Participant’s Compensation on the
basis of the earliest payments of Compensation during a year.



[End of Page]






 


VII-6









 







ARTICLE VIII




BENEFITS





8.1 Participant’s Rights and General Rules.



(a) Notwithstanding anything in this Plan to the contrary, a Participant shall not have a
right to receive his Accrued Benefit or any of the assets held in the Trust Fund except in
accordance with the terms and provisions of ARTICLE VIII. The Accrued Benefit and assets of a
Participant attributable to Elective Deferrals (and Qualified Discretionary Employer Contributions,
Qualified Employer Matching Contributions and Safe-Harbor Contributions, if any), shall not be
distributed to a Participant or Beneficiary before one of the following events:




(i) The Employee’s retirement, death, Disability or severance from employment.



(ii) A deemed severance from employment during any period the Employee is performing service
in the uniformed services described in Code §3401(h)(2)(A), provided the Participant is prohibited
from making Elective Deferrals to the Plan for at least six (6) months after receipt of the
distribution. This subparagraph (ii) applies only to amounts attributable to Elective Deferrals.



(iii) The termination of the Plan without the establishment of a successor plan as described
in Section 15.3 of the Plan and as limited by such Section. Distributions due to the occurrence of
this event shall be made in a lump sum.



(iv) The Participant’s attainment of age 59-1/2, provided that in-service withdrawals are
permitted under this ARTICLE.



(v) The Participant’s hardship, provided hardship distributions are permitted under this
ARTICLE. Distributions on account of hardship may only be made from an Elective Deferral Account.



(vi) The distribution is a Qualified Reservist Distribution, provided that Qualified Reservist
Distributions are permitted under this ARTICLE. A “Qualified Reservist Distribution” is any
distribution to an individual who is ordered or called to active duty after September 11, 2001, if:
(i) the distribution is from amounts attributable to elective deferrals in a 401(k) plan; (ii) the
individual was (by reason of being a member of a reserve component, as defined in section 101 of
title 37, United States Code) ordered or called to active duty for a period in excess of 179 days
or for an indefinite period; and (iii) the Plan makes the distribution during the period beginning
on the date of such order or call, and ending at the close of the active duty period.



(b) The Plan shall not transfer Elective Deferrals (and Qualified Discretionary Employer
Contributions, Qualified Employer Matching Contributions and Safe-Harbor Contributions, if any) to
a plan that does not provide that the transferred amounts may not be distributed before the times
specified in (a) above. The Plan does not fail to comply with the preceding sentence if it
reasonably concludes that the transferee plan provides that the transferred amounts may not be
distributed before the times specified in (a) above.


 


VIII-1









 





8.2 Normal Retirement Benefit. A Participant who attains his Normal Retirement Age
shall have a normal retirement benefit equal to his Accrued Benefit as of the last Valuation Date.
Subject to the provisions of Section 8.3 hereinbelow, the Participant may elect to receive his
Accrued Benefit as of any Valuation Date coinciding with or next following the date he retires.



8.3 Deferred Retirement Benefits. If a Participant continues to be employed by the
Employer after he has attained his Normal Retirement Age, such participant shall continue to share
in the allocation of contributions and forfeitures in accordance with ARTICLE VII, and payment of
such Participant’s normal retirement benefit shall be deferred until actual termination of
employment. Payment shall commence as soon as administratively possible following such
termination. In no event shall benefit payments be delayed beyond a Participant’s required
beginning date set forth in this ARTICLE, nor is this Section intended to provide any Participant
with a right to continue in the employ of Employer.



8.4 Disability Benefit. A Participant who, while an Employee, incurs a total and
permanent Disability prior to his Normal Retirement Age shall have a benefit equal to his Accrued
Benefit as of the last Valuation Date. Upon termination of employment due to such Disability, the
Participant may elect to receive his Accrued Benefit as of any Valuation Date coinciding with or
next following such event.



8.5 Death Benefit. A Participant who dies shall have a benefit equal to his Accrued
Benefit as of the last Valuation Date. Payment of his benefit shall commence as soon as
administratively possible following such event.



(a) Unless otherwise elected as provided below, the Beneficiary of a Participant’s death
benefit shall be the Participant’s spouse. The Participant may designate a Beneficiary other than
his spouse if:



(i) the Participant and his spouse validly waive the spouse’s right to be the Participant’s
Beneficiary and the spouse consents to the designated alternative beneficiary. Such waiver and
consent must be in writing and signed by both the Participant and the Participant’s spouse and
witnessed by a Plan representative or notary public; or



(ii) the Participant has no spouse and can establish such fact to the satisfaction of a Plan
representative; or



(iii) the spouse cannot be located and the Participant can establish such fact to the
satisfaction of a Plan representative.



(b) Any consent by a spouse (or the establishment that the consent of the spouse may not be
obtained) under subparagraph (a) above shall be effective only with respect to such spouse.
Additionally, a Participant may revoke a prior waiver without the consent of the spouse at any time
prior to the commencement of benefits. The number of revocations shall not be limited.



(c) In the case of a death occurring on or after January 1, 2007, if a Participant dies while
performing qualified military service (as defined in Code § 414(u)), the survivors of the
Participant are entitled to any additional benefits (other than benefit accruals relating to the
period of qualified military service) provided under the Plan as if the Participant had resumed and
then terminated employment on account of death.



8.6 Benefit Upon Other Termination of Employment. A Participant who terminates
employment, whether voluntarily or involuntarily, for any reason other than attainment of Normal
Retirement Age, disability or death, shall be entitled to his Vested Accrued Benefit in accordance
with Article IX hereof. Payment of such Vested Accrued Benefit shall be in accordance with this
Article and shall commence as of the Valuation Date coinciding with or next following his
termination of employment.


 


VIII-2









 





8.7 Methods of Distribution. Upon termination of employment with the Employer or upon
the termination of the Plan, the Participant may elect to receive his Vested Accrued Benefit in one
lump sum.



8.8 Medium of Payment. The Participant or beneficiary may elect to receive the
Account balances either entirely in cash, or cash for any Account balances invested in the funds
other than Company Stock, and shares of Company Stock for any Account balances invested in Company
Stock, provided that any fractional shares will be paid in cash.



8.9 Withdrawal Fee. The recordkeeper will deduct from the amount of each lump sum
payment a processing fee in an amount determined from time to time by the recordkeeper and the Plan
Administrator and timely communicated to Participants. The recordkeeper will reflect the deduction
on the statement that it issues with the payment.




8.10 General Consent Rules.



(a) If the present value of a Participant’s Vested Accrued Benefit exceeds $1,000 on the date
the distribution commences and such benefit is immediately distributable, such benefit may not be
distributed without the written consent of the Participant. A Participant’s Vested Accrued Benefit
is considered immediately distributable if any part of the benefit could be distributed to the
Participant (or surviving spouse) before the Participant attains (or would have attained if not
deceased) the later of his Normal Retirement Age or age 62. At least 30 but not more than 180 days
prior to the Participant’s Annuity Starting Date, the Administrator shall provide the Participant
with a written notice of his distribution options.



(b) A distribution may commence less than 30 days (but not less than seven (7) days) after the
notice of distribution options is given, provided that:



(i) The Plan Administrator clearly informs the Participant that he has a right to a period of
at least 30 days after receiving the notice to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular distribution option), and




(ii) The Participant, after receiving the notice, affirmatively elects a distribution.




8.11 Involuntary Cash-Out of Small Benefit.



(a) If the present value of a Participant’s Vested Accrued Benefit does not exceed $1,000 on
the date the distribution commences and, after receiving the notice described in Section 8.8 above,
the Participant does not affirmatively elect whether to take a cash distribution or a direct
rollover, the Plan Administrator shall distribute the Participant’s benefit in a cash lump sum,
less applicable withholding. However, the Participant may not be cashed-out without consent if:
(1) the Participant has begun to receive distributions under an optional form of benefit; (2) at
least one scheduled periodic distribution is still payable; and (3) the present value of the
Participant’s Vested Accrued Benefit exceeded the $1,000 cash-out limit at the time of the first
distribution under the optional form of benefit.


 


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(b) For purposes of subparagraph (a) above, the value of a Participant’s nonforfeitable
account balance shall be determined by including that portion of the account balance that is
attributable to rollover contributions (and earnings allocable thereto) accepted under Article XI
(rollover article).



8.12 Conditions for Annuity Contracts. The terms of any annuity contract purchased
and distributed by the Plan to a Participant or spouse shall comply with the requirements of this
Article. If the Participant’s benefit is distributed in the form of an annuity purchased from an
insurance company, distributions thereunder shall be made in accordance with the requirements of
Section 401(a)(9) of the Code and the final regulations thereunder. Furthermore, any annuity
contract distributed herefrom must be nontransferable.




8.13 In-Service Withdrawals.




(a) A Participant may request a Qualified Reservist Distribution, as defined in Section 8.1.



(b) The Trustee will deduct from the amount of each withdrawal under subparagraphs (c), (d)
and (e) a processing fee in an amount determined from time to time by the recordkeeper and the Plan
Administrator and timely communicated to Participants. The recordkeeper will reflect the deduction
on the statement that it issues with the payment.



(c) Each Participant may withdraw all or part of his After-Tax Account balance and Pre-1987
Vested Account balance during his Employment. The Participant must submit a written request to the
Plan Administrator, specifying the amount to be withdrawn. The Trustee will pay the amount
withdrawn in a single payment in cash as promptly as practicable after the Plan Administrator
approves the request. The Participant may not withdraw shares of Company Stock. The Trustee will
pay each withdrawal first from the Participant’s After-Tax Account to the extent possible, then
from his Pre-1987 Vested Account, and will withdraw on a pro rata basis for the investment funds in
which each Account is invested.



(d) At any time after the Participant reaches age 59-1/2, he may submit to the Plan
Administrator a written request to withdraw from his account balances; provided, however, Safe
Harbor Matching Contributions shall not be available for withdrawal under this paragraph. The
Trustee shall pay the withdrawal from such Participant’s accounts in the following order: (a)
After-Tax Account, (b) Pre-1987 Vested Account from Transferor Plan, (c) Rollover Contribution
Account, (d) Vested Employer Matching Contribution Account, (e) Vested Discretionary Employer
Contribution Account, (f) unmatched Elective Deferrals and (g) matched Elective Deferrals, to the
extent the Participant has such Accounts. The investment funds in each of the above accounts shall
be liquidated on a pro rata basis. The Participant may request his withdrawal in the form of
either cash of Company Stock.



(e) At any time, a Participant may submit to the Plan Administrator a written request to
withdraw all or any portion of his Rollover Account.



(f) If the minimum distribution requirements of Code Section 401(a)(9) apply to a Participant,
the Trustee will pay the withdrawal pro rata from all the investment funds in which the
Participant’s Accounts are invested, and from his Accounts in the following order: (A) After-Tax
Account, (2) Pre-1987 Vested Account from Transferor Plan, (3) Rollover Contribution Account, (4)
Vested Employer Matching Contribution Account, (5) Vested Discretionary Employer Contribution
Account, (6) unmatched Elective Deferrals and (7) matched Elective Deferrals, to the extent the
Participant has such Accounts. The Participant may request his withdrawal in the form of either
cash of Company Stock.


 


VIII-4









 





(g) Notwithstanding anything herein to the contrary, if a Participant’s Accrued Benefit
includes funds transferred from a Qualified Plan (“Transferor Plan”), in addition to the in-service
withdrawals described above, the optional forms of benefit (as described in Section 411(d)(6) of
the Code and the regulations thereunder) available under the Transferor Plan shall continue to be
available except as otherwise permitted under the regulations. This provision shall apply only to
the separate accounts of such Participant to which such funds have been transferred. The
Transferor Plans and protected benefits related to funds transferred from such Plans are as
follows:



(i) Cornerstone Realty Income Trust, Inc. Employee Retirement Plan and CRT Properties, Inc.
401(k) Plan.



(ii) The Transferor Plans merged into the Colonial Properties Trust 401(k) Profit Sharing Plan
effective September 1, 2006. Both of the above Transferor Plans permitted in-service withdrawals
from all vested accounts at age 59-1/2. There was no restriction as to amount or frequency. With
respect to the transferred funds only, this withdrawal option will continue to be available to
participants whose accounts were transferred.



8.14 Hardship Withdrawals. Subject to the limitations and requirements of this
Section, the Administrator may, upon the request of a Participant, make a lump sum distribution to
the Participant from his Elective Deferral Accounts (excluding earnings after December 31, 1988) as
of the Valuation Date coinciding with or immediately preceding the date a request is made
hereunder, for the purposes set forth below, subject to the following:



(a) Immediate and Heavy Financial Need. Any distribution under this Section must be
on account of an immediate and heavy financial need. A distribution will be deemed to be made on
account of an immediate and heavy financial need of the employee if the distribution is for:



(i) Expenses for (or necessary to obtain) medical care that would be deductible under IRC
Section 213(d) incurred by the Participant, the Participant’s spouse, or any dependents of the
Participant (as defined in Section 152), determined without regard to whether the expenses exceed
7.5% of adjusted gross income;



(ii) Costs directly related to the purchase of a principal residence for the Participant
(excluding mortgage payments);



(iii) Payment of tuition, related educational fees and room and board expenses for up to the
next 12 months of post-secondary education for the Participant, his spouse, children, or dependents
(as defined in IRC Section 152, and without regard to IRC Section 152(b)(1), (b)(2) and (d)(1)(B));



(iv) Payments necessary to prevent the eviction of the Participant from his principal
residence or foreclosure on the mortgage on that residence;



(v) Payments for burial or funeral expenses (incurred in taxable years after January 1, 2005)
for the Participant’s deceased parent, spouse, children or dependents (as defined in IRC Section
152, and without regard to IRC Section 152(d)(1)(B)); or


 


VIII-5









 





(vi) Expenses for the repair of damage to the Participant’s principal residence that would
qualify for the casualty deduction under IRC Section 165 (determined without regard to whether the
loss exceeds 10% of adjusted gross income).



(b) Distribution Necessary to Satisfy Need. Once the distribution is determined to be
for an immediate and heavy financial need, it must be determined that the distribution is necessary
to satisfy the need. A distribution is deemed to be necessary to satisfy an immediate and heavy
financial need of a Participant if all of the following requirements are satisfied:



(i) The distribution is not in excess of the amount of the immediate and heavy financial need
of the Participant. The amount may include any amounts necessary to pay any federal, state, or
local income taxes or penalties reasonably anticipated to result from the distribution.



(ii) The Participant has obtained all distributions (including distribution of ESOP dividends
under Code Section 404(k), but not hardship distributions) and nontaxable (at the time of the loan)
loans under all plans maintained by the Employer;



(iii) The Participant is prohibited, under the terms of the Plan or an otherwise legally
enforceable agreement, from making elective contributions and employee contributions to the Plan
and all other plans maintained by the Employer for at least six (6) months after receipt of the
hardship distribution. For this purpose, the phrase “all other plans maintained by the Employer”
means all qualified and nonqualified plans of deferred compensation maintained by the Employer.
The phrase includes a stock option, stock purchase, or similar plan, or a cash or deferred
arrangement that is part of a cafeteria plan within the meaning of Section 125. However, it does
not include the mandatory employee contribution portion of a defined benefit plan. It also does
not include a health or welfare benefit plan, including one that is part of a cafeteria plan within
the meaning of Section 125.



(c) Beneficiary Based Hardship Distribution. A Participant’s hardship event, for
purposes of the Plan’s safe harbor hardship distribution provisions pursuant to Treas. Reg.
§1.401(k)-1(d)(3)(iii)(B), includes an immediate and heavy financial need of the Participant’s
primary beneficiary under the Plan, that would constitute a hardship event if it occurred with
respect to the Participant’s spouse or dependent as defined under Code §152 (such hardship events
being limited to educational expenses, funeral expenses and certain medical expenses). For purposes
of this Article, a Participant’s “primary beneficiary under the Plan” is an individual who is named
as a beneficiary under the Plan and has an unconditional right to all or a portion of the
Participant’s account balance under the Plan upon the Participant’s death.



(d) Application. Each request for a distribution must be made by written application
to the Administrator supported by such evidence as the Administrator may require.



(e) Administrator Must Approve or Deny. A request for a distribution pursuant to this
Section shall be approved or denied by written instrument given by the Administrator to the
Participant within sixty (60) days after the date the written request is given to the Administrator
by the Participant. In the event that such request is approved, the distribution shall be made
within thirty (30) days after notice of approval is given by the Administrator to the Participant.



(f) Maximum Distributable Amount. A distribution on account of hardship must be
limited to the maximum distributable amount. The maximum distributable amount is equal to the
Employee’s total Elective Deferrals as of the date of the distribution, reduced by the amount of
previous distributions Elective Deferrals on account of hardship.


 


VIII-6









 





8.15 Statutory Commencement of Benefits. Payment of a Participant’s Accrued Benefit
must commence not later than the sixtieth (60th) day after the close of a Plan Year in which the
latest of the following events occurs:




(a) The attainment by the Participant of his Normal Retirement Age;



(b) The tenth (10th) anniversary of the date on which the Participant commenced participation
in the Plan; or




(c) Termination of employment by the Participant.




8.16 Required Beginning Date.



(a) Non-Five Percent (5%) Owners. The required beginning date of a Participant who is
not a five percent (5%) owner is the April 1 of the calendar year following the calendar year in
which occurs the later of retirement or attainment of age 70-1/2.



(b) Five Percent (5%) Owners. The required beginning date of a Participant who is a
Five Percent Owner is the April 1 following the calendar year in which the Participant attains age
70-1/2. Once distributions have begun to a Five Percent Owner under this Section, they must
continue to be made even if the Participant ceases to be a Five Percent Owner.




8.17 Minimum Distribution Requirements — General Rules.



(a) Precedence. The requirements of Sections 8.17 through 8.21 will take precedence
over any inconsistent provisions of the Plan.



(b) Requirements of Treasury Regulations Incorporated. All distributions required
under Sections 8.17 through 8.21 will be determined and made in accordance with the Treasury
regulations under Code Section 401(a)(9) and the minimum distribution incidental benefit
requirement of Code Section 401(a)(9)(G).



(c) Limits on Distribution Periods. As of the first distribution calendar year,
distributions, if not made in a single sum, may only be made over one of the following periods (or
a combination thereof):




(i) the life of the Participant;




(ii) the life of the Participant and a Designated Beneficiary;




(iii) a period certain not extending beyond the life expectancy of the Participant; or



(iv) a period certain not extending beyond the joint and last survivor expectancy of the
Participant and a Designated Beneficiary.



(d) TEFRA Section 242(b)(2) Elections. Notwithstanding the other provisions of
Sections 8.17 through 8.21, distributions may be made under a designation made before January 1,
1984, in accordance with Section 242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA)
and the provisions of the Plan that relate to Section 242(b)(2) of TEFRA.


 


VIII-7









 






8.18 Time and Manner of Distribution.



(a) Required Beginning Date. The Participant’s entire interest will be distributed,
or begin to be distributed, to the Participant no later than the Participant’s Required Beginning
Date.



(b) Death of Participant Before Distributions Begin. If the Participant dies before
distributions begin, the Participant’s entire interest will be distributed as follows:



(i) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary,
the Participant’s entire interest will be distributed to the Designated Beneficiary by December 31
of the calendar year containing the fifth anniversary of the Participant’s death.



(ii) If the Participant’s surviving spouse is not the Participant’s sole Designated
Beneficiary, the Participant’s entire interest will be distributed to the Designated Beneficiary by
December 31 of the calendar year containing the fifth anniversary of the Participant’s death.



(iii) If there is no Designated Beneficiary as of September 30 of the year following the year
of the Participant’s death, the Participant’s entire interest will be distributed by December 31 of
the calendar year containing the fifth anniversary of the Participant’s death.



(iv) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary
and the surviving spouse dies after the Participant but before distributions to the surviving
spouse begin, this subparagraph (b), other than section (b)(i), will apply as if the surviving
spouse were the Participant.



For purposes of this Section 8.18(b) and Section 8.20, unless section (iv) above applies,
distributions are considered to begin on the Participant’s Required Beginning Date. If section
(iv) applies, distributions are considered to begin on the date distributions are required to begin
to the surviving spouse under section (i). If distributions under an annuity purchased from an
insurance company irrevocably commence to the Participant before the Participant’s Required
Beginning Date (or to the Participant’s surviving spouse before the date distributions are required
to begin to the surviving spouse under section (i) above), the date distributions are considered to
begin is the date distributions actually commence.



(c) Forms of Distribution. Unless the Participant’s interest is distributed in the
form of an annuity purchased from an insurance company or in a single sum on or before the required
beginning date, as of the first Distribution Calendar Year distributions will be made in accordance
with Sections 8.19 and 8.20. If the Participant’s interest is distributed in the form of an
annuity purchased from an insurance company, distributions thereunder will be made in accordance
with the requirements of Section 401(a)(9) of the Code and the Treasury regulations.




8.19 Required Minimum Distributions During Participant’s Lifetime.



(a) Amount of Required Minimum Distribution For Each Distribution Calendar Year.
During the Participant’s lifetime, the minimum amount that will be distributed for each
Distribution Calendar Year is the lesser of:



(i) the quotient obtained by dividing the Participant’s Account Balance by the distribution
period in the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9, Q&A-2, of the Treasury
regulations, using the Participant’s age as of the Participant’s birthday in the Distribution
Calendar Year; or


 


VIII-8









 





(ii) if the Participant’s sole Designated Beneficiary for the Distribution Calendar Year is
the Participant’s spouse, the quotient obtained by dividing the Participant’s Account Balance by
the number in the Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9, Q&A-3, of the
Treasury regulations, using the Participant’s and spouse’s attained ages as of the Participant’s
and spouse’s birthdays in the Distribution Calendar Year.



(b) Lifetime Required Minimum Distributions Continue Through Year of Participant’s
Death. Required minimum distributions will be determined under this Section 8.19 beginning
with the first Distribution Calendar Year and up to and including the Distribution Calendar Year
that includes the Participant’s date of death.




8.20 Required Minimum Distributions After Participant’s Death.




(a) Death On or After Date Distributions Begin.



(i) Participant Survived by Designated Beneficiary. If the Participant dies on or
after the date distributions begin and there is a Designated Beneficiary, the minimum amount that
will be distributed for each Distribution Calendar Year after the year of the Participant’s death
is the quotient obtained by dividing the Participant’s Account Balance by the longer of the
remaining Life Expectancy of the Participant or the remaining Life Expectancy of the Participant’s
Designated Beneficiary, determined as follows:



(A) The Participant’s remaining Life Expectancy is calculated using the age of the Participant
in the year of death, reduced by one for each subsequent year.



(B) If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary,
the remaining Life Expectancy of the surviving spouse is calculated for each Distribution Calendar
Year after the year of the Participant’s death using the surviving spouse’s age as of the spouse’s
birthday in that year. For Distribution Calendar Years after the year of the surviving spouse’s
death, the remaining Life Expectancy of the surviving spouse is calculated using the age of the
surviving spouse as of the spouse’s birthday in the calendar year of the spouse’s death, reduced by
one for each subsequent calendar year.



(C) If the Participant’s surviving spouse is not the Participant’s sole Designated
Beneficiary, the Designated Beneficiary’s remaining Life Expectancy is calculated using the age of
the beneficiary in the year following the year of the Participant’s death, reduced by one for each
subsequent year.



(ii) No Designated Beneficiary. If the Participant dies on or after the date
distributions begin and there is no Designated Beneficiary as of September 30 of the year after the
year of the Participant’s death, the minimum amount that will be distributed for each Distribution
Calendar Year after the year of the Participant’s death is the quotient obtained by dividing the
Participant’s Account Balance by the Participant’s remaining Life Expectancy calculated using the
age of the Participant in the year of death, reduced by one for each subsequent year.


 


VIII-9









 






(b) Death Before Date Distributions Begin.



(i) Participant Survived by Designated Beneficiary. If the Participant dies before
the date distributions begin and there is a Designated Beneficiary, the Participant’s entire
interest will be distributed to the Designated Beneficiary by December 31 of the calendar year
containing the fifth anniversary of the Participant’s death.



(ii) No Designated Beneficiary. If the Participant dies before the date distributions
begin and there is no Designated Beneficiary as of September 30 of the year following the year of
the Participant’s death, distribution of the Participant’s entire interest will be completed by
December 31 of the calendar year containing the fifth anniversary of the Participant’s death.



(iii) Death of Surviving Spouse Before Distributions to Surviving Spouse Are Required to
Begin. If the Participant dies before the date distributions begin, the Participant’s
surviving spouse is the Participant’s sole Designated Beneficiary, and the surviving spouse dies
before distributions are required to begin to the surviving spouse under Section 8.18(b)(i), this
Section 8.20(b) will apply as if the surviving spouse were the Participant.




8.21 Definitions.



(a) “Designated Beneficiary” shall mean the individual who is designated as the beneficiary
under Section 3.9 of the Plan and is the designated beneficiary under Section 401(a)(9) of the
Internal Revenue Code and section 1.401(a)(9)-4 of the Treasury regulations.



(b) “Distribution Calendar Year” shall mean a calendar year for which a minimum distribution
is required. For distributions beginning before the Participant’s death, the first Distribution
Calendar Year is the calendar year immediately preceding the calendar year which contains the
Participant’s Required Beginning Date. For distributions beginning after the Participant’s death,
the first Distribution Calendar Year is the calendar year in which distributions are required to
begin under Section 8.18. The required minimum distribution for the Participant’s first
Distribution Calendar Year will be made on or before the Participant’s Required Beginning Date.
The required minimum distribution for other Distribution Calendar Years, including the required
minimum distribution for the Distribution Calendar Year in which the Participant’s Required
Beginning Date occurs, will be made on or before December 31 of that Distribution Calendar Year.



(c) “Life Expectancy” shall mean life expectancy as computed by use of the Single Life Table
in Section 1.401(a)(9)-9, Q&A-1, of the Treasury regulations.



(d) “Participant’s Account Balance” shall mean the account balance as of the last Valuation
Date in the calendar year immediately preceding the Distribution Calendar Year (valuation calendar
year) increased by the amount of any contributions made and allocated or forfeitures allocated to
the account balance as of dates in the valuation calendar year after the Valuation Date and
decreased by distributions made in the valuation calendar year after the Valuation Date. The
account balance for the valuation calendar year includes any amounts rolled over or transferred to
the Plan either in the valuation calendar year or in the Distribution Calendar Year if distributed
or transferred in the valuation calendar year.




(e) “Required Beginning Date” shall mean date specified in section 8.16 of the Plan.


 


VIII-10









 






8.22 Location of Participants and Beneficiaries.



(a) It is the duty of Participants who have terminated employment, or Beneficiaries of
Participants, to keep the Administrator informed as to their correct address. If a Participant or
Beneficiary fails to inform the Administrator in writing of a change of address and if the
Administrator is unable to locate such Participant or Beneficiary by reasonable means, the
Administrator shall notify the Participant or Beneficiary of available benefits by registered mail
at the last address noted on the records of the Administrator. If the delivery of the notice by
registered mail is refused or returned with address unknown, any benefits due such Participant or
Beneficiary shall be segregated into a federally insured savings account for the benefit of the
Participant or Beneficiary. The segregated account shall not share in the earnings and losses in
the fair market value of the assets held in the Trust Fund. The Administrator shall determine
earnings and losses in the fair market value of the assets held in the segregated account and shall
allocate such earnings and losses to the segregated account. Such benefit shall remain in the
segregated account until distributed in accordance with the Lost or Unclaimed Property Laws of the
state in which the Plan Sponsor is domiciled.



(b) If the Plan has terminated and the Administrator is unable to locate a Participant or
Beneficiary using the means described in (a) above, the Administrator shall establish a savings
account for the benefit of the Participant or Beneficiary at a federally insured banking
institution within the geographic vicinity in which the Employer is located. Any benefits due such
Participant or Beneficiary shall be deposited in said savings account at the same time
distributions are otherwise allowed under the Plan termination procedures. Such benefit shall
remain in the savings account until distributed in accordance with the Lost or Unclaimed Property
Laws of the state where the account is maintained.



8.23 Payments for the Benefit of Minors or Incompetents. If the Administrator
receives evidence that a Participant or Beneficiary entitled to receive any payment under the Plan
(“Recipient”) is a minor or under any legal disability, including without limitation incompetence
or incapacity, and may be unable to receive such payment, apply the proceeds to his or her best
interest, and give valid release therefor, then the Administrator, in its sole discretion, is
authorized to pay over such sums in any one or more of the following ways:



(a) to the legal guardian or conservator of the Recipient, or to the Representative Payee who
has been appointed to receive any government benefits paid on behalf of such Recipient, or to an
agent designated under a valid durable power of attorney for the use and benefit of the Recipient;
or



(b) to any custodial account established for the Recipient prior to the date of such payment,
or if none exists, to a custodian eligible to serve as such custodian of the Recipient under the
Uniform Transfers (or Gifts) to Minors Act in effect in the state of the Recipient’s residence for
the use and benefit of the Recipient; or



(c) to the trustee (either court appointed or with a valid power of attorney) of any trust, or
share of a trust, established prior to the date of such payment for the sole benefit of the
Recipient, including without limitation, if appropriate, payment to the trustee of a discretionary,
supplemental special needs trust.



The Administrator, in its discretion, may elect not to use any of (a), (b) or (c) above and may
seek direction from a court of competent jurisdiction.


 


VIII-11









 





ARTICLE IX




VESTING





9.1 Requirements.



(a) A Participant’s Accrued Benefit derived from Employer contributions shall be fully Vested
upon the earlier of: (1) attainment of his Normal Retirement Age, (2) the later of age 65 or the
5th anniversary of the time the Participant commenced participation in the Plan, (3) total and
permanent disability of the Participant, or (4) death of the Participant.



(b) Except as otherwise provided in this Section, a Participant shall have a Vested interest
in his Accrued Benefit derived from Discretionary Employer Contributions and
non-Safe-Harbor Employer Matching Contributions in accordance with the following schedule:



	 	 	 	 	 
	Years of Vesting Service	 	Vested Percentage	 
	 
	Less than 1
	 	 	0	%
	1
	 	 	20	%
	2
	 	 	40	%
	3
	 	 	60	%
	4
	 	 	80	%
	5
	 	 	100	%






(c) The Accrued Benefit derived from Elective Deferrals, Safe Harbor Contributions, Employer
Matching Contributions made for the 2009 Plan Year, After-Tax Employee Contributions, Qualified
Employer Matching and Qualified Discretionary Employer Contributions shall be fully Vested at all
times.



(d) Notwithstanding the provisions of this Section, Employer Matching Contributions and
Qualified Employer Matching Contributions (if accrued) shall be forfeited if the contributions to
which they relate are treated as Excess Deferrals, Excess Contributions or Excess Aggregate
Contributions.



(e) A Participant’s Vested percentage in his Accrued Benefit derived from Employer
contributions, as of the later of the adoption date or Effective Date of this Amendment, shall not
be reduced by this or any Amendment to the Plan.



(f) Benefits transferred from Cornerstone Realty Income Trust, Inc. Employee Retirement Plan
(the “Cornerstone Plan”) shall be vested as follows:



(i) With respect to the transferred account balances of participants in the Cornerstone Plan
who terminated employment with Cornerstone Realty Income Trust, Inc. prior to its acquisition by
Colonial Properties Trust, such transferred balances will remain vested according to the applicable
vesting schedules as of the date of such termination of employment.




(ii) All other benefits transferred from the Cornerstone Plan shall be fully-vested.


 


IX-1









 






9.2 Cash-Out; Buy-Back.



(a) If a Participant terminates employment with the Employer and thereafter is re-employed and
again becomes eligible to participate in the Plan, the following Years of Vesting Service shall be
disregarded for purposes of determining the Accrued Benefit of such Participant; but shall be taken
into account for purposes of such Participant’s eligibility and vesting upon re-employment:



(i) Years of Vesting Service with respect to which he has received an involuntary
distribution of the present value of his Vested Accrued Benefit (provided the distribution was made
not later than the close of the second Plan Year following the Plan Year in which the Participant
terminated employment); or



(ii) Years of Vesting Service with respect to which he has received a distribution of his
Vested Accrued Benefit attributable to such Years of Vesting Service, which he elected to receive
(provided the distribution was made not later than the close of the second Plan Year following the
Plan Year in which the Participant terminated employment).



(b) A Participant who has received a distribution of his Vested Accrued Benefit, as described
hereinabove in subparagraph (a) of this Section, may repay the amount of such distribution to the
Trust Fund, provided




(i) such Participant is subsequently re-employed by Employer; and



(ii) repayment is made before the earlier of 5 years after the first date on which the
Participant is subsequently re-employed, or the close of the period in which the Employee incurs
five (5) consecutive 1-year Breaks In Service following the date of distribution.



(c) Upon such repayment, the Employer shall make a contribution to his Employer Contribution
Account as required by Section 6.7. Immediately after such repayment, his Accrued Benefit shall,
in no event, be less than his Accrued Benefit immediately prior to termination of employment.



(d) A Participant who has been deemed to receive a zero cash-out distribution per Section 9.3
below and who is re-employed before incurring five (5) consecutive 1-year Breaks In Service
following the date of distribution is deemed to have repaid the zero distribution, and the
non-vested portion of his Accrued Benefit shall be restored immediately upon re-employment.
Immediately after such deemed repayment, his Accrued Benefit shall, in no event, be less than his
Accrued Benefit immediately prior to termination of employment.



9.3 Forfeitures. Notwithstanding the provisions of Section 9.2 hereinabove, upon
termination of employment, the portion of a Participant’s Accrued Benefit derived from Employer
Contributions which is not Vested shall be forfeited upon the earlier of a cash-out distribution to
the Participant, or the incurrence of five (5) consecutive Breaks-In-Service. For purposes of this
Section, a Participant who terminates employment with a zero Vested Accrued Benefit shall be deemed
to have received a cash-out distribution as of the date on which he separates from service. A
Participant with Elective Deferrals in his account has a Vested Accrued Benefit and may not be
deemed to receive a cash-out under this Section. Forfeitures shall be used to reduce the
contribution of the Employer for the same and/or future Plan Years.


 


IX-2









 





9.4 Computation of Years of Vesting Service. For purposes of computing Years of
Vesting Service under the Plan to determine the Vested percentage under Section 9.1, all of an
Employee’s Years of Vesting Service shall be taken into account, except that the following Years of
Vesting Service shall be excluded:



(a) In the case of a Participant who has 5 consecutive 1-year Breaks In Service, all Years of
Vesting Service after such Breaks In Service will be disregarded for the purpose of vesting the
employer-derived Accrued Benefit that accrued before such Breaks, but both pre-break and post-break
service will count for the purposes of vesting the employer-derived Accrued Benefit that accrues
after such Breaks. Separate accounts will be maintained for the Participant’s pre-break and
post-break employer-derived Accrued Benefit pursuant to Section 7.3 hereof. Both accounts will
share in the earnings and losses of the Trust Fund.



(b) In the case of a Participant who does not have 5 consecutive 1-year Breaks In Service,
both the pre-break and post-break service will count in vesting both the pre-break and post-break
employer-derived Accrued Benefit.



9.5 Hours of Service Requirement. A Participant who has less than one thousand
(1,000) Hours of Service in any Plan Year shall not advance on the vesting schedule for that year.



[End of Page]





 


IX-3









 







ARTICLE X




TOP-HEAVY PLAN




10.1 Top-Heavy Requirements. For any Plan Year in which the Plan is determined to be
a Top-Heavy Plan as determined in accordance with Section 10.2 hereof:



(a) The allocable share of the Employer contribution for each Participant who is a non-key
employee shall not be less than the lesser of: (i) three percent (3%) of such Participant’s
Compensation, or (ii) the largest percentage of the Employer contribution made (or required to be
made), including salary deferrals, for any Key Employee for such Plan Year. Salary deferrals of
non-key employees may not be treated as Employer contributions for purposes of this minimum
contribution requirement. For purposes of this ARTICLE, Compensation shall mean a Participant’s
Section 415 Compensation (for the full Plan Year for which the contribution is made), including
contributions made pursuant to a salary reduction arrangement. Section 415 Compensation under this
subparagraph shall be limited as specified in Section 3.15(f) hereinabove.



(b) Employer Matching Contributions shall be taken into account for purposes of satisfying the
minimum contribution requirements of Section 416(c)(2) of the Code and the Plan. The preceding
sentence shall apply with respect to matching contributions under the Plan or, if the Plan provides
that the minimum contribution requirement shall be met in another plan, such other plan. Employer
Matching Contributions that are used to satisfy the minimum contribution requirements shall be
treated as matching contributions for purposes of the actual contribution percentage test and other
requirements of Section 401(m) of the Code.




10.2 Top-Heavy Determination.



(a) The Plan shall be considered a Top-Heavy Plan and shall be subject to the additional
requirements of Section 10.1 hereinabove, with respect to any Plan Year, if, as of the Anniversary
Date of the preceding Plan Year or in the case of the first Plan Year, the Anniversary Date of such
Plan Year (hereinafter referred to as the “Determination Date”) either:



(i) the Sum of the Value of the Aggregate Accounts of Key-Employees exceeds sixty percent
(60%) of a similar sum determined for all Employees, excluding former Key-Employees, (the “60%
Test”); or



(ii) the Plan is part of a Required Aggregation Group, and the sum of the Present Value of
Accrued Benefits and the Value of the Aggregate Accounts of Key-Employees in all Plans in such
Group exceeds sixty percent (60%) of a similar sum determined for all Employees, excluding former
Key-Employees.



(b) For purposes of this Section 10.2, the Aggregate Account of an Employee as of the
Determination Date is the sum of:



(i) a Participant’s Accounts holding contributions made by the Employer pursuant to Section
6.1 hereinabove as of the Determination Date adjusted for any contributions due as of the
Determination Date, and further adjusted by including:



(A) any Plan distributions made within the one-year period ending on the Determination Date;


 


X-1









 





(B) any distributions under a terminated plan which, had it not been terminated, would have
been aggregated with the Plan under Section 416(g)(2)(A)(i) of the Code; and



(C) in the case of a distribution made for other than severance from employment, death or
disability, any distributions made within the five-year period ending on the Determination Date.




(ii) a Participant’s non-deductible Employee Contribution Account, if any; and



(iii) a Participant’s Rollover Account (except for a rollover account maintained to record a
post-December 31, 1983 transfer to the Trust Fund which was initiated by the Employee and made to
this Plan from a plan which was not maintained by the Employer or by an entity required to be
aggregated with the Employer).



(c) For purposes of this Section, Present Value of Accrued Benefits shall be determined, in
the case of a defined benefit pension plan, under the provisions of such a plan or plans.



(d) Notwithstanding the provisions of subsection (a) hereinabove, the Plan shall not be a
Top-Heavy Plan, if the Administrator elects to treat the Plan as part of a Permissive Aggregation
Group, and the Permissive Aggregation Group is not determined to be Top-Heavy using the criteria of
the “60% Test” hereinabove.



(e) Only those plans in which the Determination Dates fall within the same calendar year shall
be included in a Required or a Permissive Aggregation Group in order to determine whether the Plan
is a Top-Heavy Plan.



(f) If a Participant or former Participant (a Participant who no longer shares in
contributions or forfeitures and/or no longer accrues a benefit for a Plan Year) has not performed
any services for the Employer maintaining the Plan at any time during the one year period ending on
the Determination Date, the Aggregate Account and/or Present Value of Accrued Benefit for such
Participant shall not be taken into account for purposes of subsection (a) hereinabove.



(g) Solely for the purpose of determining if the Plan, or any other plan included in a
required or permissive aggregation group of which this Plan is a part, is top-heavy (within the
meaning of Section 416(g) of the Code) the Accrued Benefit of an Employee other than a key employee
(within the meaning of Section 416(i)(1) of the Code) shall be determined under (a) the method, if
any, that uniformly applies for accrual purposes under all plans maintained by the Affiliated
Employers, or (b) if there is no such method, as if such benefit accrued not more rapidly than the
slowest accrual rate permitted under the fractional accrual rate of Section 411(b)(1)(C) of the
Code.



[End of Page]




 


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ARTICLE XI




ROLLOVERS AND TRANSFERS




11.1 Direct Rollovers by Employees. Notwithstanding any provisions of the Plan to the
contrary that would otherwise limit a Distributee’s election under this Section, a Distributee may
elect, at the time and in the manner prescribed by the Plan Administrator, to have any portion of
an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan specified by the
Distributee in a direct rollover. However, if his Eligible Rollover Distribution is less than
$500, he may elect to have all, but not a portion, of such distribution paid directly to an
Eligible Retirement Plan specified by the Distributee.



11.2 Definitions. For purposes of this ARTICLE XI, the following definitions shall
apply:




(a) “Eligible Rollover Distribution” shall mean:



(i) Except as provided in (ii) below, 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: (1)
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 ten years or more; (2) any distribution to the extent such
distribution is required under Section 401(a)(9) of the Code; (3) any hardship distribution from
the Plan, (4) the portion of any distribution that is not includable in gross income (determined
without regard to the exclusion for net unrealized appreciation with respect to Employer
securities); and (5) any other distribution(s) that is reasonably expected to total less than $200
during a year.



(ii) Notwithstanding the provisions of (i) above, a portion of a distribution shall not fail
to be an eligible rollover distribution merely because the portion consists of after-tax employee
contributions or Roth elective deferral contributions which are not includible in gross income.
Such portion may be transferred only:



(A) to an individual retirement account or annuity described in Section 408(a) or (b) of the
Code, or



(B) to a qualified plan (defined contribution or defined benefit) described in Section 401(a)
of the Code or to an annuity contract described in Section 403(b) of the Code. The recipient plan
or contract must: (1) agree to separately account for amounts so transferred (and earnings
thereon, including separately accounting for the portion of such distribution which is includible
in gross income and the portion of such distribution which is not so includible, and (2) in the
case of the transfer of Roth elective deferrals, contain a Roth elective deferral feature.



(b) “Eligible Retirement Plan” shall mean an individual retirement account or annuity
described in Section 408(a) or 408(b) of the Code, an annuity plan described in Section 403(a) of
the Code, or a qualified trust described in Section 401(a) of the Code, that accepts the
Distributee’s Eligible Rollover Distribution. An Eligible Retirement Plan shall also mean an
annuity contract described in section 403(b) of the Code and an eligible plan under section 457(b)
of the Code which is maintained by a state, political subdivision of a state, or any agency or
instrumentality of a state or political subdivision of a state and which agrees to separately
account for amounts transferred into such plan from this plan. The definition of eligible
retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a
spouse or former spouse who is the alternate payee under a qualified domestic relation order, as
defined in section 414(p) of the Code.


 


XI-1









 





(c) “Distributee” shall mean an Employee or former Employee. In addition, 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 Section 414(p) of the Code, are Distributees with regard to the
interest of the spouse or former spouse.



(d) “Direct Rollover” shall mean a payment by the Plan to the Eligible Retirement Plan
specified by the Distributee.




11.3 Direct Rollover of Non-Spousal Distribution.



(a) A non-spouse beneficiary who is a “designated beneficiary” under Code §401(a)(9)(E) and
the regulations thereunder, by a direct trustee-to-trustee transfer (“direct rollover”), may roll
over all or any portion of his or her distribution to an individual retirement account the
beneficiary establishes for purposes of receiving the distribution. In order to be able to roll
over the distribution, the distribution otherwise must satisfy the definition of an eligible
rollover distribution.



(b) Although a non-spouse beneficiary may roll over directly a distribution as provided in
Section (a) above, any distribution made prior to January 1, 2010 is not subject to the direct
rollover requirements of Code §401(a)(31) (including Code §401(a)(31)(B), the notice requirements
of Code §402(f) or the mandatory withholding requirements of Code §3405(c)). If a non-spouse
beneficiary receives a distribution from the Plan, the distribution is not eligible for a “60-day”
rollover.



(c) If the Participant’s named beneficiary is a trust, the Plan may make a direct rollover to
an individual retirement account on behalf of the trust, provided the trust satisfies the
requirements to be a designated beneficiary within the meaning of Code §401(a)(9)(E).



(d) A non-spouse beneficiary may not roll over an amount which is a required minimum
distribution, as determined under applicable Treasury regulations and other Revenue Service
guidance. If the Participant dies before his or her required beginning date and the non-spouse
beneficiary rolls over to an IRA the maximum amount eligible for rollover, the beneficiary may
elect to use either the 5-year rule or the life expectancy rule, pursuant to Treas. Reg.
§1.401(a)(9)-3, A-4(c), in determining the required minimum distributions from the IRA that
receives the non-spouse beneficiary’s distribution.



11.4 Direct Rollover to Roth IRA. For distributions made after December 31, 2007, a
Participant or spousal beneficiary may elect to roll over directly or indirectly (and a non-spouse
beneficiary may roll over directly) an eligible rollover distribution to a Roth IRA described in
Code Section 408A(b). Amounts transferred under this Section will be taxable in the year in which
the transfer occurs.




11.5 Rollovers From Other Plans.



(a) Direct Rollovers. The Plan will accept a direct rollover of an eligible rollover
distribution from the following types of plans:



(i) A qualified plan described in Section 401(a) or 403(a) of the Code, excluding
after-tax employee contributions.


 


XI-2









 





(ii) An annuity contract described in Section 403(b) of the Code, excluding after-tax
employee contributions.



(iii) An eligible plan under Section 457(b) of the Code which is maintained by a state,
political subdivision of a state, or any agency or instrumentality of a state or political
subdivision of a state.



(b) Traditional 60-day Rollovers. If elected below, an Employee may transfer to the
Plan all or any portion of the proceeds received from another plan, in accordance with procedures
established by the Administrator, provided the transfer occurs on or before the sixtieth (60th) day
following receipt of the distribution by the Employee from the other plan, and, if the proceeds
received from the other plan were received by the Employee as a partial distribution, such
distribution must qualify under Section 402(a)(5)(D) of the Code, or, provided the transfer is
directly made from a “conduit” Individual Retirement Account (as defined in Section 408(a) of the
Code) which held only the proceeds from such other plan and which were transferred to the
Individual Retirement Account on or before the 60th day following receipt of the distribution by
the Employee from the other plan. The plan will accept a participant contribution of an eligible
rollover distribution from the following types of plans:



(i) A qualified plan described in Section 401(a) or 403(a) of the Code, excluding
after-tax employee contributions.



(ii) An annuity contract described in Section 403(b) of the Code, excluding after-tax
employee contributions.



(iii) An eligible plan under Section 457(b) of the Code which is maintained by a state,
political subdivision of a state, or any agency or instrumentality of a state or political
subdivision of a state.



(c) Rollovers from Traditional IRAs. The Plan will not accept rollovers from
traditional (non-“conduit”) individual retirement account or annuity described in section 408(a) or
408(b) of the Code.



11.6 Procedures and Information. The Administrator shall develop such procedures and
may require such other information from an Employee desiring to make (or to have made) such
rollover or transfer as described in this Article as it deems necessary or desirable to determine
that the proposed transfer will meet the requirements of this Article and of the Code.



11.7 Allocations to Rollover Account. Upon approval by the Administrator, the amount
transferred shall be deposited in the Trust Fund and shall be allocated to the Employee’s Rollover
Account.



 


XI-3









 




11.8 Vesting of Rollover Account. An Employee’s Rollover Account shall be fully
Vested at all times.



11.9 Distributions of Rollover Account. When a Participant terminates his employment
with the Employer upon retirement, death or disability, or when the Plan is terminated, the total
amount in his Rollover Account shall be distributed to him in accordance with ARTICLE VIII.



11.10 Eligible Employees. An Employee shall be eligible to make or direct the
transfers permitted in this ARTICLE even though he is not yet eligible to participate in the Plan
as required by ARTICLE V.



11.11 Acceptance of Transferred Loan Notes from Other Plans. If a Participant’s
Accrued Benefit includes funds transferred from a Qualified Plan (“Transferor Plan”), and if such
Accrued Benefit includes an outstanding loan note, the Plan (“Transferee Plan”) may accept the loan
note transferred from the Other Plan, provided:



(a) The change in obligee or the change in repayment schedule shall not be deemed to create a
new loan for any purpose under Section 72(p), 401(a)(13) and 4975(d)(1); and



(b) There shall be a written assignment of the promissory note and any security documentation
from the trustee of the Other Plan to the Trustee of the Transferee Plan, which shall be approved,
accepted and acknowledged by Employer and Participant.



[End of Page]





 


XI-4









 







ARTICLE XII




DIRECTED INVESTMENTS




12.1 Selection of Investment Provider. The Retirement Committee shall select the
Investment Provider or Providers for the Plan based on such criteria as established by the
Retirement Committee. The Retirement Committee shall have the authority to terminate an Investment
Provider, at any time, upon written notice as provided in the contractual agreement between the
Retirement Committee and the Investment Provider or Providers.



12.2 Investment Options. The Retirement Committee shall select a broad and
diversified menu of investment options offered by the Investment Provider, including, but not
limited to, the following asset classes:



	 	 	 	 	 
	Stable Value

	 	Intermediate-term Bond
	 	Target-Date 2015-2029
	Long-term Bond

	 	Target-Date 2000-2014
	 	Large Blend
	Large Value

	 	Large Growth
	 	Target-Date 2030+
	Foreign Large Blend

	 	Mid-Cap Blend
	 	Mid-Cap Growth
	Small Value

	 	Small Blend
	 	Small Growth
	Company Stock
	 	 	 	 






The Retirement Committee may select all or less than all of the above asset classes as investment
options offered by the Investment Provider.



12.3 Participant Direction. A Participant may direct the investment of his or her
account on a daily basis into one or more of the investment options offered by the Investment
Provider.



12.4 Failure to Elect. If any Participant fails to timely make his investment
selections, or if his elected investments total less than 100 percent of his Account balances, the
Retirement Committee will invest the balances for which no election is made in the stable value
fund of the Investment Provider.



12.5 Allocation of Earnings. All earnings attributable to the Account balances
invested in each asset class will be reinvested in that asset class.



12.6 Rule Applicable to Elective Deferrals and Employee Contributions. For Plan Years
beginning after December 31, 2006, if any portion of the account of a Participant (including, for
purposes of this Article, a beneficiary entitled to exercise the rights of a Participant)
attributable to elective deferrals or employee contributions is invested in publicly-traded
Employer securities, the Participant may elect to direct the Plan to divest any such securities,
and to reinvest an equivalent amount in other investment options which satisfy the requirements of
Section 12.8.



12.7 Rule Applicable to Employer Contributions. If any portion of a Participant’s
account attributable to nonelective or matching contributions is invested in publicly-traded
Employer securities, then a Participant who has completed at least three (3) years of vesting
service, or a beneficiary of any deceased Participant entitled to exercise the right of a
Participant, may elect to direct the Plan to divest any such securities, and to reinvest an
equivalent amount in other investment options which satisfy the requirements of Section 12.8.


 


XII-1









 





(a) Three-year phase-in applicable to Employer contributions. For Employer securities
acquired with nonelective or matching contributions during a Plan Year beginning before January 1,
2007, the rule described in this Section 12.7 only applies to the percentage of the Employer
securities (applied separately for each class of securities) as follows:



	 	 	 	 	 
	Plan Year	 	Percentage	 
	2007
	 	 	33	 
	2008
	 	 	66	 
	2009
	 	 	100	 






(b) Exception to phase-in for certain age 55 Participants. The 3-year phase-in rule of
Section 12.7(a) does not apply to a Participant who has attained age 55 and who has completed at
least three (3) years of service before the first Plan Year beginning after December 31, 2005.



12.8 Investment Options. For purposes of this Article, other investment options must
include not less than three investment options, other than Employer securities, to which the
Participant may direct the proceeds of divestment of Employer securities required by this Article,
each of which options is diversified and has materially different risk and return characteristics.
The Plan must provide reasonable divestment and reinvestment opportunities at least quarterly.
Except as provided in regulations, the Plan may not impose restrictions or conditions on the
investment of Employer securities which the Plan does not impose on the investment of other Plan
assets, other than restrictions or conditions imposed by reason of the application of securities
laws or a condition permitted under IRS Notice 2006-107 or other applicable guidance.



12.9 Exceptions for Certain Plans. This Article does not apply to a one-participant
plan, as defined in Code §401(a)(35)(E)(iv), or to an employee stock ownership plan (“ESOP”) if:
(i) there are no contributions to the ESOP (or related earnings) attributable to elective deferrals
or matching contributions; and (ii) the ESOP is a separate plan, for purposes of Code §414(l), from
any other defined benefit plan or defined contribution plan maintained by the same employer or
employers.



12.10 Treatment as Publicly Traded Employer Securities. Except as provided in Treasury
regulations or in Code §401(a)(35)(F)(ii) (relating to certain controlled groups), a plan holding
Employer securities which are not publicly traded Employer securities is treated as holding
publicly traded Employer securities if any Employer corporation, or any member of a controlled
group of corporations which includes such Employer corporation (as defined in Code
§401(a)(35)(F)(iii)) has issued a class of stock which is a publicly traded Employer security.



[End of Page]




 


XII-2









 







ARTICLE XIII




ADOPTION OF PLAN BY PARTICIPATING EMPLOYERS





13.1 Right of Participating Employers to Participate.



(a) A corporation, limited liability company, partnership or proprietorship (hereinafter
referred to as a “Participating Employer”), may adopt and participate in the Plan if such
corporation, limited liability company, partnership or proprietorship is a member of the Controlled
Group or Affiliated Service Group, and the Plan Administrator approves such adoption and
participation. Control shall be determined under the provisions of Section 1563(a) of the Code,
except as limited by Section 415(h), and Affiliated Service Group shall be determined under the
provisions of Section 414(m).



(b) If approved by the Plan Sponsor in writing, an employer may adopt the Plan as a
Participating Employer even though such employer is not a member of the Controlled Group or
Affiliated Service Group. In such event, the Plan shall be a multiple-employer plan.



(c) Adoption of the Plan by a Participating Employer shall be evidenced by written action of
the Participating Employer either in the form of a written resolution of such Board or a separate
agreement executed by a duly authorized officer of such Participating Employer (or in the case of a
partnership or proprietorship written authorization of a general partner or the proprietor) wherein
it is agreed that the Participating Employer adopts the Plan and agrees to be bound by all the
terms and provisions of the Plan. In addition, such Participating Employer shall give written
notice of such adoption to the Administrator of the Plan.



(d) Approval of the adoption of the Plan by a Participating Employer shall be evidenced by
written action of the Administrator and Named Fiduciary wherein they approve adoption of the Plan
by the Participating Employer.



13.2 Participant Accounts. A Participant who is employed or has been employed by
Employer and/or Participating Employer shall have a separate Employer Contribution Account for
Employer and each Participating Employer to which shall be allocated contributions and forfeitures
from Employer and each Participating Employer together with earnings and losses thereon.


 


XIII-1









 





13.3 Administrative Powers of Plan Administrator. The administrative powers and
control of the Administrator shall not be diminished under the Plan by reason of the participation
of any Participating Employer in the Plan and such administrative powers and controls specifically
granted herein to the Administrator shall apply only to the Administrator. The right to amend the
Plan shall apply only to the Named Fiduciary.



13.4 Creation of Trust. A Participating Employer shall be required to appoint the
Trustee which has been appointed by the Named Fiduciary to serve as Trustee of any funds
contributed for its Employees and shall authorize the Named Fiduciary to appoint such successor or
co-Trustees as it deems necessary and advisable. A Participating Employer shall also be required
to make contributions on behalf of its Employees to such Trustee to hold, invest and maintain
pursuant to the terms and provisions of the Trust Agreement entered into between the Trustee and
Employer.




13.5 Transfer of Employment.



(a) For purposes of determining a Year of Vesting Service, a Break in Service and an Hour of
Service, the transfer of a Participant between Employer and any Participating Employer shall not be
deemed a termination of employment.



(b) For purposes of determining participation in the Plan, all service with Employer and with
each Participating Employer shall be taken into account.



(c) For purposes of determining an Employee’s Years of Vesting Service under the Plan, all
Years of Vesting Service with Employer and each Participating Employer shall be taken into account.




13.6 Withdrawal of Participating Employers.



(a) A Participating Employer may withdraw from the Plan by giving written notice of such
withdrawal to the Administrator. Such notice shall contain: (1) the effective date of withdrawal;
(2) a statement whether the withdrawal constitutes a termination of the Plan as to its Employees;
and (3) the disposition to be made of assets held by the Trustee for the Employees of such
Participating Employer.



(b) Employer may require a Participating Employer to withdraw from the Plan by giving sixty
(60) days written notice thereof to the Administrator and to the President of such Participating
Employer (or in the case of a partnership or proprietorship to a general partner or the
proprietor). Such notice shall contain: (1) the effective date of withdrawal, and (2) the date
the Trustee will release assets held by it for the Employees of such Participating Employer. Upon
receipt of such notice, the Participating Employer shall, within thirty (30) days thereafter,
notify the Administrator, in writing, (1) whether it intends to create its own plan, intends to
terminate the Plan for its Employees, or intends to adopt the plan of another company; and (2) the
name and address of the trustee or other party who is to receive the assets held by the Trustee for
the Employees of the Participating Employer.



 


XIII-2









 




(c) Upon withdrawal of a Participating Employer from the Plan, either under subsection (a) or
(b) hereinabove, the Administrator shall give written notification to the Trustee of such
withdrawal and shall direct the Trustee to transfer and pay over the assets held by the Trustee for
the Employees of the Participating Employer to a successor Trustee or another party or to the
Employees. For purposes of this Section, if the Employees of the withdrawing Participating
Employer cease participation in the Plan as a result of the withdrawal, the employment of such
Employees shall be considered terminated. Distribution of the vested account balance of each such
Employee shall be made in the same manner and at the same time as provided in Section 8.6. The
non-vested account balance of each such Employee shall be treated as a forfeiture in accordance
with the provisions of Section 9.3.



(d) If the Participating Employer, which is required to withdraw under subsection (b)
hereinabove, does not cooperate or fully comply with the terms of subsection (b), then the
Administrator may direct the Trustee to distribute to each Employee of the Participating Employer
his Accrued Benefit in the same manner and at the same time as provided in Section 8.6. Upon such
distribution, the duties, obligations and responsibilities of the Administrator and Trustee to the
Employees of the Participating Employer shall terminate.



(e) Upon withdrawal by such Participating Employer, all administration and control which the
Employer and the Administrator had heretofore exercised with respect to such Participating Employer
shall cease and all administration and controls shall be the responsibility of such withdrawing
Participating Employer or the Administrator appointed by it. The Named Fiduciary and the
Administrator shall be relieved of any further liability therefor.



13.7 Internal Revenue Service Approval of Plan for a Participating Employer. Promptly
upon becoming a Participating Employer, such Participating Employer or the Employer may make
initial application to the Internal Revenue Service for approval of the Plan as it pertains to such
Participating Employer. In the event the Internal Revenue Service issues an adverse letter with
respect to such application and determines that the Plan as it pertains to such Participating
Employer fails to qualify under Section 401 of the Code, then the adoption of the Plan by the
Participating Employer shall become null and void, ab initio. Upon a failure to
obtain initial qualification of the Plan, any contributions made by the Participating Employer to
the Trustee shall be returned to the Participating Employer to the extent allowed under Section
17.6 hereunder. If application is not made to the Internal Revenue Service, then, at a minimum the
Participating Employer shall notify the Internal Revenue Service that its Employees are
participating in the Plan.



13.8 Joint Venture Restriction. Neither the adoption of this Plan by a Participating
Employer nor the act performed by it in relation to this Plan shall ever create a joint venture or
partnership between Employer and any Participating Employer.



13.9 Commingled Assets. Notwithstanding anything to the contrary, it is the intention
of the Employer and the Participating Employer that the Trust Fund shall be available to pay
benefits to all of the employees who are participating in the Plan and their beneficiaries.



[End of Page]





 


XIII-3









 







ARTICLE XIV




FIDUCIARY RESPONSIBILITIES





14.1 Allocation of Responsibilities Among Fiduciaries.



(a) Trustee: The Trustee shall have exclusive responsibility for the control and management
of the Trust Fund except as otherwise provided in the Trust Agreement and specifically, but not in
limitation of its general authority, investment and reinvestment of the Trust Fund.



(b) Administrator: The Administrator shall have responsibility and authority to control the
operation and administration of the Plan as specifically set forth in ARTICLE IV of the Plan.




(c) The Employer:



(i) The Employer shall have the authority and responsibility for (i) the design of the Plan,
including the right to amend the Plan; (ii) the qualification under applicable law of the Plan, any
amendments to the Plan, and any document relating to the Plan; (iii) the funding of the Plan; (iv)
the designation of the Named Fiduciary; (v) review of disallowed claims of Participants; (vi)
appointment of an Investment Manager; and (vii) the exercise of all fiduciary functions provided in
the Plan or in the Trust Agreement or necessary to the operation of the Plan except such functions
as are assigned to other fiduciaries pursuant to the Plan or Trust Agreement, including the
authority to allocate or delegate fiduciary responsibilities which do not involve the management
and control of the Trust Fund.



(ii) Any authority assigned or reserved to the Employer under the Plan and Trust Agreement
shall be exercised by resolution of the Employer’s Board and shall become effective, with respect
to the Trustee, upon written notice to the Trustee signed by the President, Treasurer or Secretary
of the Employer advising the Trustee of such exercise.



(iii) The Employer as Named Fiduciary shall allocate and delegate fiduciary responsibilities
by giving written notice thereof to the Plan Administrator and the Trustee of the responsibilities
to be allocated and the person or persons to whom the responsibilities are to be allocated. In
implementing the procedure for the allocation and delegation of fiduciary responsibilities, the
Employer shall discharge its duties with respect to such allocation and delegation with the care,
prudence and diligence under the circumstances then prevailing that a prudent man acting in a like
capacity and familiar with such matters would use in the conduct of an enterprise of like character
with like aims; and it shall discharge its duties solely in the interest of the Participants and
their Beneficiaries. The Employer shall make a formal periodic review of the performance of any
fiduciary to whom it allocates or delegates fiduciary responsibilities and of any person which it
employs to render advice in regard to any fiduciary responsibility which it has under the Plan and
Trust Agreement.




 


XIV-1









 




14.2 No Joint Fiduciary Responsibilities.



(a) It is intended under the Plan and Trust Agreement, that the Plan Administrator, Named
Fiduciary, Employer and Trustee, shall be responsible for the proper exercise of their respective
powers, duties, responsibilities and obligations and they shall not be responsible for any act or
failure to act of each other.



(b) This ARTICLE is intended to allocate to each fiduciary individual responsibility for the
prudent execution of the functions assigned to him, and none of such responsibilities or any other
responsibility shall be shared by two or more of such fiduciaries unless such sharing shall be
provided by a specific provision of the Plan, Trust Agreement or Investment Policy Statement duly
approved by the Employer, its Board of Trustees or any committee to which it has delegated
authority with respect to the Investment Policy Statement. Whenever one fiduciary is required by
the Plan, Trust Agreement or Investment Policy Statement to follow the directions of another
fiduciary, the two fiduciaries shall not be deemed to have been assigned a shared responsibility,
but the responsibility of the fiduciary giving the directions shall be deemed his sole
responsibility, and the responsibility of the fiduciary receiving those directions shall be to
follow them insofar as such instructions are on their face proper under applicable law. Each
fiduciary, other than the Trustee, may rely upon any direction, information or action with respect
to the investment and reinvestment of the Trust Fund as being proper under the Plan and Trust
Agreement and they are not required by the terms of the Plan and Trust Agreement to inquire into
the propriety of any investment or reinvestment of the Trust Fund. Nothing in the Plan or Trust
Agreement shall be deemed to enlarge the responsibilities or liabilities of any fiduciary with
respect to the Plan and Trust Agreement beyond those imposed by ERISA.



14.3 Advisor to Named Fiduciary. The Named Fiduciary may employ one or more persons
to render advice concerning any responsibility of the Named Fiduciary under the Plan or Trust
Agreement, and all other fiduciaries may rely on such advice, any written opinions or certificates
without further investigation.



[End of Page]





 


XIV-2









 







ARTICLE XV




AMENDMENT AND TERMINATION




15.1 Amendments. The Employer, the Board or, to the extent delegated by the Board,
any committee appointed by the Board, shall have the right at any time and from time to time, to
amend, in whole or in part, any or all of the provisions of this Plan, so long as such amendment or
amendments in no way reduce the value of a Participant’s Accrued Benefit or eliminate an optional
form of distribution. In addition, no such amendment shall authorize or permit any part of the
Trust Fund to be used for or diverted to purposes other than for the exclusive benefit of the
Participants or their Beneficiaries. Any amendment shall become effective upon the execution of a
written instrument, provided that the amendment is approved or ratified by order of the Board (or
its Executive Committee if such delegation is permitted by the by-laws of the Employer) and
delivered to the Plan Administrator and Trustee. The provisions of this Section shall be deemed a
procedure for amending the Plan and for identifying the persons who have authority to amend the
Plan and is intended to satisfy the requirements of Section 402(b)(3) of ERISA.



15.2 Election of Pre-Amendment Vesting Schedule. In the event the Plan is amended to
change or modify Section 9.l, a Participant with at least three (3) Years of Vesting Service, as
defined for purposes of ARTICLE IX, as of the expiration of the election period described below,
may elect to be subject to the pre-amendment vesting schedule. If a Participant fails to make such
an election, then such Participant shall be subject to the new vesting schedule. The election of
the pre-amendment vesting schedule shall be made by giving written notice to the Plan Administrator
during the election period. The election period shall begin on the date such amendment is adopted
and shall end no earlier than the latest of the following dates:



(a) The date which is sixty (60) days after the date the amendment is adopted;



(b) The date which is sixty (60) days after the date the Plan amendment becomes effective; or



(c) The date which is sixty (60) days after the date the Participant is issued written notice
of the amendment by the Employer or Administrator.



Such election shall be made only by an individual who is a Participant at the time such election is
made and such election shall be irrevocable. Such amendment shall not reduce the Vested percentage
of a Participant’s Accrued Benefit as of the later of the date on which such amendment is adopted
or the effective date of such amendment.


 


XV-1









 






15.3 Termination.



(a) General. The Employer shall have the right at any time to terminate this Plan, by
delivering to the Trustee written notice of such termination. This Plan shall also terminate in
the event the Employer is legally adjudicated as bankrupt, or makes a general assignment for the
benefit of creditors, or is dissolved, except a dissolution in connection with the reorganization
of the Employer. Upon any such termination or upon a partial termination, or upon a complete
discontinuance of contributions to the Trust Fund, the rights of all affected Participants or their
Beneficiaries to benefits accrued to the date of such termination, partial termination or
discontinuance, shall be fully Vested in accordance with the terms and provisions of the Plan. At
such time that the Trust is liquidated and distributions are to be made, the Trustee may distribute
a Participant’s accrued benefit without the Participant’s consent, provided: (1) the Plan does not
offer an annuity option, purchased from a commercial provider, and (2) the Employer or any entity
within the same Controlled Group as the Employer does not maintain another defined contribution
plan, other than an employee stock ownership plan defined in Code Section 4975(e)(7). If another
such plan is maintained, the Participant’s accrued benefit may be transferred without consent to
the other plan if the Participant does not consent to an immediate distribution from the
terminating plan.



(b) Distribution Limitation for Elective Deferrals. A distribution of a Participant’s
Elective Deferrals may not be made under subparagraph (a) above if the Employer establishes or
maintains a “successor plan.” For purposes of this rule, a successor plan is any other defined
contribution plan maintained by the Employer. However, if fewer than two percent of the Employees
who are eligible under the Plan at the time of its termination are or were eligible under another
defined contribution plan at any time during the 24-month period beginning 12 months before the
time of the termination, the other plan is not a successor plan. The term “defined contribution
plan” means a plan that is a defined contribution plan as defined in Code Section 414(i), but does
not include an employee stock ownership plan as defined in Code Section 4975(e)(7) or 409(a), a
simplified employee pension plan as defined in Code Section 408(k), a SIMPLE IRA plan as defined in
Code Section 408(p), a plan or contract described in Code Section 403(b), or a plan described in
Code Section 457(b) or (f). A plan is a successor plan only if it exists at the time the Plan is
terminated or within the period ending 12 months after distribution of all assets from the Plan.



[End of Page]





 


XV-2









 







ARTICLE XVI




CLAIMS PROCEDURE




16.1 Notice of Claim. In the event a Participant has a claim for any benefits under
this Plan, then such Participant shall file a claim with the Administrator on a form or forms
provided for such purpose.



16.2 Determination of Claim. The Administrator shall make all determinations as to
the right of any person to a benefit provided hereunder. If the claim is denied, within ninety
(90) days after receipt of the claim by the Administrator, the Administrator shall furnish to
claimant written notice of this decision. If special circumstances require an extension of time of
no more than ninety (90) additional days, then written notice will be given to the claimant before
the end of the original ninety (90) day period and will (a) explain the reasons for the delay; and
(b) when a determination of the claim is expected to be made. If the claim is wholly or partially
denied, the written notice shall set forth in a manner reasonably calculated to be understood by
the claimant: (a) the specific reason or reasons for the denial; (b) specific reference to
pertinent Plan provisions on which the denial is based; (c) a description of additional material or
information that should have been included with the claim, if any, and explain its importance in
the determination of the claim; and (d) an explanation of the Plan’s review procedures and
applicable time limits.




16.3 Review of Claim Determination.



(a) Within sixty (60) days after receipt by the claimant of written notification of denial of
a claim, the claimant may appeal such denial by filing with the Administrator a written application
for a review of the denial of the claim. In connection with such appeal, the claimant: (i) will
have access to all written comments, documents, and records relating to the claim upon request of
the claimant and at no cost to the claimant; (ii) may submit all information, documents, and
records, regardless of whether such information was submitted or considered in the initial claim
determination; and (iii) may request a hearing with the Administrator.



(b) A decision on review shall be made by the Administrator within sixty (60) days after
receipt of a written request unless a hearing has been requested and will be issued to the claimant
in written or electronic form. If special circumstances require an extension of time for
processing of the appeal, in which case the Administrator’s decision on review shall be rendered no
later than one hundred twenty (120) days after receipt of the request for review. If special
circumstances require an extension, written notice will be given to the claimant before the end of
the original sixty (60) day period and will (i) explain the reasons for the delay; and (ii) when a
determination of the claim on review is expected to be made. In the event that the claim is denied
on appeal, the claimant will have access to and be permitted to obtain a copy of all documents and
records pertaining to his or her appeal. Furthermore, the notification of the claimant will
include (i) specific reasons for the decision, written in a manner reasonably calculated to be
understood by the claimant; (ii) contain specific references to the pertinent portions of the
documents governing the Plan on which the decision is based; (iii) a statement informing the
claimant that he or she may access or obtain copies of all relevant documents and records; and
(iv) his or her right to bring a civil action after an appeal.



[End of Page]





 


XVI-1









 







ARTICLE XVII




MISCELLANEOUS




17.1 Participant’s Rights; Acquittance. Neither the establishment of the Plan hereby
created, nor any modification thereof, nor the creation of any fund or account, nor the payment of
any benefits, shall be construed as giving to any Participant or other person any legal or
equitable right against the Employer, or any officer or employee thereof, or the Trustee, or any
insurance company, except as provided herein. Under no circumstances shall the terms of employment
of any Participant be modified or in any way affected hereby.



Nothing contained in this Plan shall be construed to add directly or indirectly to the rights
of the Employees against the Employer. The action of the Employer in creating this Plan or any
other action contemplated by either the Employer or its Employees, shall not be construed to
constitute or evidence any contractual relationship between the Employer and any Employee, or as a
right of any Employee to continue in the employment of the Employer, or as a limitation of the
right of the Employer to discharge any of its Employees, with or without cause. The Employer shall
have the absolute right to deal with any Employee who may be a Participant hereunder at any time as
if the Plan had never been created. Nothing herein contained shall be construed as placing any
obligation whatever upon the Employer to see that any distribution to a Participant is made at any
time from the Trust Fund herein created, and the Employer shall not be liable to any person
whatever in respect to payments from the Trust Fund.



17.2 Board Authorization. Whenever the Employer, under the terms of this Plan, is
permitted or required to do or perform any act or matter or thing, it shall be done and performed
by any officer thereunto duly authorized by the Board.



17.3 ERISA Pre-Emption. This Plan shall be administered in the United States of
America, and its validity, construction and all rights hereunder shall be governed by the laws of
the United States under ERISA. To the extent the ERISA shall not be held to have pre-empted local
law, the Plan shall be administered and construed under and governed by the laws of the State of
Alabama.



17.4 Indemnification By Employer. The Employer does hereby indemnify and hold
harmless any person, corporation, professional corporation, professional association or
partnership, that is deemed to be a fiduciary under the terms and provisions of ERISA and the
regulations promulgated thereunder from and against any and all losses, claims, damages, expense
(including court costs and attorney’s fees) and liabilities arising from his duties and
responsibilities in connection with the Plan and Trust Agreement unless the same is determined to
be due to criminal acts or acts involving fraud or wanton conduct, provided that this
indemnification by Employer provided in this Section does not extend to corporate trustees or to
Investment Advisors appointed under the Trust Agreement, who are being compensated for services
rendered to the Employer or for their responsibilities under the Trust Agreement and Plan.


 


XVII-1









 






17.5 Exclusive Benefit Rule.



(a) The Trust Fund shall never inure to the benefit of any Employer and shall be held for the
exclusive purpose of providing benefits to Participants in the Plan and their Beneficiaries and for
any reasonable expenses of administering the Plan, except that:



(i) Contributions made by the Employer under a mistake of fact shall be returned to the
Employer within one (1) calendar year of the payment of such contribution. Earnings attributable
to the excess contribution may not be returned to the employer, but losses attributable thereto
must reduce the amount to be so returned. Furthermore, if the withdrawal of the amount attributable
to the mistaken or nondeductible contribution would cause the balance of the individual account of
any participant to be reduced to less than the balance which would have been in the account had the
mistaken or nondeductible amount not been contributed, then the amount to be returned to the
employer must be limited so as to avoid such reduction.



(ii) If a contribution is conditioned upon the deductibility of such contribution under
Section 404 of the Internal Revenue Code of 1986, as amended, then, to the extent the deduction is
disallowed, the contribution shall be returned to the Employer within one (1) calendar year after
the disallowance of the deduction.



(b) Sponsorship of the Plan may not be transferred from the Employer to an unrelated taxpayer
unless the transfer is in connection with a transfer of business assets or operations to the
unrelated taxpayer.



17.6 Employer Reversion Upon Initial Disqualification. Notwithstanding any contrary
provisions contained in any portion of this Plan, in the event the Commissioner of Internal Revenue
determines that the Plan is not initially qualified under the Code, any contribution made incident
to that initial qualification by the Employer must be returned to the Employer within one year
after the date the initial qualification is denied, but only if the application for the
qualification is made by the time prescribed by law for filing the Employer’s return for the
taxable year in which the Plan is adopted, or such later date as the Secretary of the Treasury may
prescribe.



17.7 Merger or Consolidation. In the case of any merger or consolidation with, or
transfer of assets or liabilities to, any other plan, each Participant shall, if the Plan is
terminated, receive a benefit immediately after the merger, consolidation, or transfer which is
equal to or greater than the benefit he would have been entitled to receive immediately before the
merger, consolidation, or transfer, if the Plan had been terminated.




17.8 Non-Alienation Provision.



(a) In General. Except as may be provided in this Section, neither the Trust nor any
of the assets, nor any interest herein shall be subject to any conveyance, transfer, assignment,
sequestration, garnishment, attachment, levy, encumbrance, or other judicial process or order of
any kind to satisfy the claims of creditors, and the Trustee shall not give any effect to such
conveyance, transfer, assignment, sequestration, garnishment, attachment, levy, encumbrance, or
other judicial process or order. The interests of Participants and their Beneficiaries under the
Plan and Trust shall not be subject to the claims of any creditors and shall not be liable for
their debts, contracts or torts. Participants and their Beneficiaries shall not in any way convey,
transfer, assign, sequester, garnish, attach, levy, or otherwise encumber their interests in the
Plan in law or in equity, and any such conveyance, transfer, assignment, sequestration,
garnishment, attachment, levy, or encumbrance shall be void.




 


XVII-2









 




(b) Domestic Relations Orders.



(i) The Plan Administrator shall comply with the terms of a Qualified Domestic Relations Order
(“QDRO”) as defined in Section 414(p) of the Code.



(ii) Any such domestic relations order shall not require the Plan to provide any type or form
of benefit, or any option not otherwise provided under the Plan, nor to provide increased benefits
(determined on the basis of actuarial value) or the payment of benefits to an alternate payee which
are required to be paid to another alternate payee under another order previously determined to be
a qualified domestic relations order.



(iii) The Plan Administrator shall promptly notify the Participant and each alternate payee of
the receipt of a domestic relations order by the Plan and the Plan’s procedures for determining the
qualified status of domestic relations orders. Within a reasonable period after receipt of a
domestic relations order, the Plan Administrator shall determine whether such order is a qualified
domestic relations order and shall notify the Participant and each alternate payee of such
determination. If the Participant or any affected alternate payee disagrees with the
determinations of the Plan Administrator, the disagreeing party shall be treated as a claimant and
the claims procedure of the Plan shall be followed. The Plan Administrator may bring an action for
a declaratory judgment in a court of competent jurisdiction to determine the proper recipient of
the benefits to be paid by the Plan.



(iv) During any period in which the issue of whether a domestic relations order is a qualified
domestic relations order is being determined (by the Plan Administrator, by a court of competent
jurisdiction or otherwise), the Plan Administrator shall separately account for the amounts which
would have been payable to the alternate payee during such period if the order had been determined
to be a qualified domestic relations order. If, within the eighteen (18) month period beginning on
the date on which the first payment would be required to be made under the domestic relations
order, the order (or modification thereof) is determined to be a qualified domestic relations
order, the Plan Administrator shall pay the segregated amounts, including any interest thereon, to
the person or persons entitled thereto. If within such eighteen (18) month period it is determined
that the order is not a qualified domestic relations order or the issue as to whether such order is
a qualified domestic relations order is not resolved, then the Plan Administrator shall pay the
segregated amounts, including any interest thereon, to the person or persons who would have been
entitled to such amounts if there had been no order. Any determination that an order is a
qualified domestic relations order which is made after the close of the eighteen (18) month period
shall be applied prospectively only.



(v) The Plan Administrator shall establish reasonable procedures to determine the status of
domestic relations orders and to administer distributions under qualified orders.



(vi) In the event the alternate payee dies prior to the commencement or completion of the
distribution of the segregated amounts to which he is entitled, and if the terms of the qualified
domestic relations order do not address the disposition of such amounts in the event of the
alternate payee’s death, and if there is no designated Beneficiary surviving at the alternate
payee’s death, the Administrator shall be empowered to designate a Beneficiary or Beneficiaries on
his behalf, but only from among the following, in the order named: (1) spouse, (2) children, in
equal shares, (3) parents, in equal shares or survivor, (4) brothers and sisters, per stirpes, and
(5) estate of the alternate payee. In the event any of the above shall be under the age of
majority, then the proceeds shall be paid in accordance with the provisions of Section 8.23.



(vii) Upon the issuance of a valid QRDO (as defined in Section 414(p) of the Code), payment of
the alternate payee’s portion of the Participant’s Accrued Benefit shall commence as soon as
administratively possible after such Order is approved, unless such Order specifies a later date.
The alternate payee’s portion of the Participant’s Accrued Benefit shall be valued as of the
Valuation Date immediately preceding the distribution. If the value of the alternate payee’s
benefit exceeds $1,000, payment may not be made without the prior written consent of the alternate
payee on forms approved by the Administrator. If the alternate payee is also a Participant in the
Plan, such alternate payee may elect to defer distribution until such time as he or she is
otherwise entitled to receive a distribution of his or her own Accrued Benefit.


 


XVII-3









 





(viii) Effective April 6, 2007, a domestic relations order that otherwise satisfies the
requirements for a QDRO will not fail to be a QDRO: (i) solely because the order is issued after,
or revises, another domestic relations order or QDRO; or (ii) solely because of the time at which
the order is issued, including issuance after the annuity starting date or after the Participant’s
death. However, a domestic relations order described in this subparagraph is subject to the same
requirements and protections that apply to QDROs.



(c) The provisions of subparagraph (a) above shall not apply to any offset of a Participant’s
benefit pursuant to certain judgments and settlements as defined in Section 401(a)(13)(C) of the
Code.



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



17.10 Delegation of Responsibilities by Named Fiduciary. The Named Fiduciary may
designate any other person or persons, including the Trustee, to perform and carry out the
responsibilities and duties herein imposed on the Administrator, and the Named Fiduciary may revoke
any such delegation of responsibility. Any action of such person or persons in the exercise of
such delegated responsibility shall have the same force and effect for all purposes as if such
action had been taken by the Administrator.



17.11 Voting of Company Stock. Voting rights with respect to Colonial Properties REIT
common stock held by the Trustee shall be passed through to the holders of units in such Company
Stock fund. Each Participant whose Account balances are invested in such fund shall direct the
Trustee with respect to the voting of his shares to the extent of whole shares of the common stock
represented by his units. The Trustee will vote the shares of any Participant who fails to submit
or timely submit his direction, in proportion to those votes timely submitted by all other
Participants in the aggregate. The Trustee will vote the shares of other Company Stock funds, if
any, as directed by the Plan Administrator.



17.12 Trust. The Employer and the Trustee have entered into a Trust Agreement which
provides for the holding of funds necessary to fund the benefits set forth in this Plan. The Trust
Fund shall be received, held and disbursed in accordance with the provisions of the Trust Agreement
and the Plan. No part of the Trust Fund shall be used for or diverted to purposes other than for
the exclusive benefit of the Participants, former Participants and their Beneficiaries.



17.13 Non-Contractual Obligation of Employer. Although it is the intention of the
Employer that this Plan continue from year to year and contributions be made regularly,
continuation of the Plan is entirely voluntary and the payments thereunder are not assumed as a
contractual obligation of the Employer.



17.14 Basis for Payments From the Plan. The basis for making payments from the Plan
is contained in ARTICLE VIII which are intended to satisfy the requirements of ERISA.



17.15 Funding Policy. ARTICLE VI shall be deemed the procedure for establishing and
carrying out the funding policy and method of this Plan. The Named Fiduciary shall be authorized
to adopt such additional procedures and methods as necessary, which shall be communicated in
writing to the Administrator and Trustee. Such funding policy and method shall be consistent with
the objectives of this Plan and with the requirements of Title I of ERISA. In addition, the
provisions of ARTICLE VI shall be deemed the basis on which payments are made to this Plan.


 


XVII-4









 





THE EMPLOYER has caused this Plan to be executed by its duly authorized officer and duly
attested, and its corporate seal to be hereunto affixed, on this, the 27th day of October, 2009.



	 	 	 	 	 	 	 
	 	 	COLONIAL PROPERTIES TRUST	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John P. Rigrish
 

John P. Rigrish
	 	 
	 

	 	 	 	Its Chief Administrative Officer & Secretary	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	(EMPLOYER)   	 	 





 


XVII-5









 





Table of Contents




	 	 	 	 	 
	 	 	Page	 
	 
	ARTICLE I PURPOSE
	 	 	 	 
	 
	ARTICLE II NAME AND EFFECTIVE DATES
	 	II-1	 
	 
	2.1 Name of Plan
	 	II-1	 
	2.2 Contributing Date
	 	II-1	 
	2.3 Effective Date
	 	II-1	 
	2.4 Restatement Effective Dates
	 	II-1	 
	 
	ARTICLE III DEFINITIONS
	 	III-1	 
	 
	ARTICLE IV ADMINISTRATION OF THE PLAN
	 	IV-1	 
	 
	4.1 Powers of the Administrator
	 	IV-1	 
	4.2 Employer as Administrator
	 	IV-2	 
	4.3 Administrative Records
	 	IV-2	 
	4.4 Bonding of the Administrator
	 	IV-2	 
	4.5 Non-Discriminatory Administration
	 	IV-3	 
	4.6 Terminated Participant Statement
	 	IV-3	 
	4.7 Delegation by Administrator
	 	IV-3	 
	 
	ARTICLE V PARTICIPATION OF EMPLOYEES
	 	 	V-1	 
	 
	5.1 Requirements
	 	 	V-1	 
	5.2 Re-Hired Employees
	 	 	V-1	 
	5.3 Participation Upon Return to Eligible Class
	 	 	V-2	 
	5.4 Participation Agreement
	 	 	V-2	 
	5.5 Leave of Absence
	 	 	V-2	 
	 
	ARTICLE VI CONTRIBUTIONS
	 	VI-1	 
	 
	6.1 Employer Contributions: Types and Amounts
	 	VI-1	 
	6.2 Elective Deferrals: Amounts and Procedures
	 	VI-2	 






 


i









 





	 	 	 	 	 
	 	 	Page	 
	 
	6.3 Elective Deferral Dollar Limitations
	 	VI-2	 
	6.4 Non-deductible Employee Contributions
	 	VI-3	 
	6.5 Actual Deferral Percentage Limitations
	 	VI-4	 
	6.6 Actual Contribution Percentage Limitations
	 	VI-5	 
	6.7 Additional Contribution to Restore Cashed-Out Benefits
	 	VI-7	 
	 
	ARTICLE VII ALLOCATIONS AND ADJUSTMENTS TO ACCOUNTS
	 	VII-1	 
	 
	7.1 Procedure
	 	VII-1	 
	7.2 Accrual of Contributions
	 	VII-1	 
	7.3 Accounts
	 	VII-2	 
	7.4 Limitations on Annual Additions
	 	VII-2	 
	7.5 Definition of Annual Additions
	 	VII-2	 
	7.6 Change of Limitation Year
	 	VII-3	 
	7.7 Excess Annual Additions
	 	VII-3	 
	7.8 Aggregation and Disaggregation of Plans
	 	VII-3	 
	7.9 Section 415 Compensation for Testing and Other Compliance Purposes
	 	VII-4	 
	7.10 Definition of Compensation for Contributions and Benefits
	 	VII-6	 
	7.11 Section 415 Compensation Paid After Severance from Employment
	 	VII-6	 
	7.12 Compensation Limit Application to 401(k) Plans
	 	VII-6	 
	 
	ARTICLE VIII BENEFITS
	 	VIII-1	 
	 
	8.1 Participant’s Rights and General Rules
	 	VIII-1	 
	8.2 Normal Retirement Benefit
	 	VIII-2	 
	8.3 Deferred Retirement Benefits
	 	VIII-2	 
	8.4 Disability Benefit
	 	VIII-2	 
	8.5 Death Benefit
	 	VIII-2	 
	8.6 Benefit Upon Other Termination of Employment
	 	VIII-2	 
	8.7 Methods of Distribution
	 	VIII-3	 






 


ii









 





	 	 	 	 	 
	 	 	Page	 
	 
	8.8 Medium of Payment
	 	VIII-3	 
	8.9 Withdrawal Fee
	 	VIII-3	 
	8.10 General Consent Rules
	 	VIII-3	 
	8.11 Involuntary Cash-Out of Small Benefit
	 	VIII-3	 
	8.12 Conditions for Annuity Contracts
	 	VIII-4	 
	8.13 In-Service Withdrawals
	 	VIII-4	 
	8.14 Hardship Withdrawals
	 	VIII-5	 
	8.15 Statutory Commencement of Benefits
	 	VIII-7	 
	8.16 Required Beginning Date
	 	VIII-7	 
	8.17 Minimum Distribution Requirements — General Rules
	 	VIII-7	 
	8.18 Time and Manner of Distribution
	 	VIII-8	 
	8.19 Required Minimum Distributions During Participant’s Lifetime
	 	VIII-8	 
	8.20 Required Minimum Distributions After Participant’s Death
	 	VIII-9	 
	8.21 Definitions
	 	VIII-10	 
	8.22 Location of Participants and Beneficiaries
	 	VIII-11	 
	8.23 Payments for the Benefit of Minors or Incompetents
	 	VIII-11	 
	 
	ARTICLE IX VESTING
	 	IX-1	 
	 
	9.1 Requirements
	 	IX-1	 
	9.2 Cash-Out; Buy-Back
	 	IX-2	 
	9.3 Forfeitures
	 	IX-2	 
	9.4 Computation of Years of Vesting Service
	 	IX-3	 
	9.5 Hours of Service Requirement
	 	IX-3	 
	 
	ARTICLE X TOP-HEAVY PLAN
	 	 	X-1	 
	 
	10.1 Top-Heavy Requirements
	 	 	X-1	 
	10.2 Top-Heavy Determination
	 	 	X-1	 






 


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	 	 	Page	 
	 
	ARTICLE XI ROLLOVERS AND TRANSFERS
	 	XI-1	 
	 
	11.1 Direct Rollovers by Employees
	 	XI-1	 
	11.2 Definitions
	 	XI-1	 
	11.3 Direct Rollover of Non-Spousal Distribution
	 	XI-2	 
	11.4 Direct Rollover to Roth IRA
	 	XI-2	 
	11.5 Rollovers From Other Plans
	 	XI-2	 
	11.6 Procedures and Information
	 	XI-3	 
	11.7 Allocations to Rollover Account
	 	XI-3	 
	11.8 Vesting of Rollover Account
	 	XI-4	 
	11.9 Distributions of Rollover Account
	 	XI-4	 
	11.10 Eligible Employees
	 	XI-4	 
	11.11 Acceptance of Transferred Loan Notes from Other Plans
	 	XI-4	 
	 
	ARTICLE XII DIRECTED INVESMENTS
	 	XII-1	 
	 
	12.1 Selection of Investment Provider
	 	XII-1	 
	12.2 Investment Options
	 	XII-1	 
	12.3 Participant Direction
	 	XII-1	 
	12.4 Failure to Elect
	 	XII-1	 
	12.5 Allocation of Earnings
	 	XII-1	 
	12.6 Rule Applicable to Elective Deferrals and Employee Contributions
	 	XII-1	 
	12.7 Rule Applicable to Employer Contributions
	 	XII-1	 
	12.8 Investment Options
	 	XII-2	 
	12.9 Exceptions for Certain Plans
	 	XII-2	 
	12.10 Treatment as Publicly Traded Employer Securities
	 	XII-2	 
	 
	ARTICLE XIII ADOPTION OF PLAN BY PARTICIPATING EMPLOYERS
	 	XIII-1	 
	 
	13.1 Right of Participating Employers to Participate
	 	XIII-1	 
	13.2 Participant Accounts
	 	XIII-1	 
	13.3 Administrative Powers of Plan Administrator
	 	XIII-2	 






 


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	 	 	Page	 
	 
	13.4 Creation of Trust
	 	XIII-2	 
	13.5 Transfer of Employment
	 	XIII-2	 
	13.6 Withdrawal of Participating Employers
	 	XIII-2	 
	13.7 Internal Revenue Service Approval of Plan for a Participating Employer
	 	XIII-3	 
	13.8 Joint Venture Restriction
	 	XIII-3	 
	13.9 Commingled Assets
	 	XIII-3	 
	 
	ARTICLE XIV FIDUCIARY RESPONSIBILITIES
	 	XIV-1	 
	 
	14.1 Allocation of Responsibilities Among Fiduciaries
	 	XIV-1	 
	14.2 No Joint Fiduciary Responsibilities
	 	XIV-2	 
	14.3 Advisor to Named Fiduciary
	 	XIV-2	 
	 
	ARTICLE XV AMENDMENT AND TERMINATION
	 	XV-1	 
	 
	15.1 Amendments
	 	XV-1	 
	15.2 Election of Pre-Amendment Vesting Schedule
	 	XV-1	 
	15.3 Termination
	 	XV-2	 
	 
	ARTICLE XVI CLAIMS PROCEDURE
	 	XVI-1	 
	 
	16.1 Notice of Claim
	 	XVI-1	 
	16.2 Determination of Claim
	 	XVI-1	 
	16.3 Review of Claim Determination
	 	XVI-1	 
	 
	ARTICLE XVII MISCELLANEOUS
	 	XVII-1	 
	 
	17.1 Participant’s Rights; Acquittance
	 	XVII-1	 
	17.2 Board Authorization
	 	XVII-1	 
	17.3 ERISA Pre-Emption
	 	XVII-1	 
	17.4 Indemnification By Employer
	 	XVII-1	 
	17.5 Exclusive Benefit Rule
	 	XVII-2	 
	17.6 Employer Reversion Upon Initial Disqualification
	 	XVII-2	 
	17.7 Merger or Consolidation
	 	XVII-2	 






 


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	 	 	Page	 
	 
	17.8 Non-Alienation Provision
	 	XVII-2	 
	17.9 USERRA Military Service Credit
	 	XVII-4	 
	17.10 Delegation of Responsibilities by Named Fiduciary
	 	XVII-4	 
	17.11 Voting of Company Stock
	 	XVII-4	 
	17.12 Trust
	 	XVII-4	 
	17.13 Non-Contractual Obligation of Employer
	 	XVII-4	 
	17.14 Basis for Payments From the Plan
	 	XVII-4	 
	17.15 Funding Policy
	 	XVII-4	 







 


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