Exhibit 10.16


 


AES CORPORATION


 


INTERNATIONAL RETIREMENT PLAN


 


 


AS AMENDED AND RESTATED ON DECEMBER 29, 2008


 

















 


TABLE OF CONTENTS


 


	
  ARTICLE 1 -  DEFINITIONS

  	
  1

  
	
   

  	
   

  
	
  ARTICLE 2 -  ELIGIBILITY AND PARTICIPATION

  	
  4

  
	
   

  	
   

  
	
  ARTICLE 3 -  ACCOUNTS

  	
  5

  
	
   

  	
   

  
	
  ARTICLE 4 -  DISTRIBUTION

  	
  6

  
	
   

  	
   

  
	
  ARTICLE 5 -  BENEFICIARY DESIGNATION

  	
  7

  
	
   

  	
   

  
	
  ARTICLE 6 -  ADMINISTRATION

  	
  8

  
	
   

  	
   

  
	
  ARTICLE 7 -  MISCELLANEOUS

  	
  9

  
	
   

  	
   

  
	
  APPENDIX A

  	
   

  



 


i

















 


AES CORPORATION

INTERNATIONAL RETIREMENT PLAN


 


As Amended and Restated
on December 29, 2008


 


The AES Corporation (the “Sponsor”)
established the AES Corporation International Retirement Plan (the “Plan”),
effective January 1, 2007.  The
purpose of this Plan is to provide certain employees of the Sponsor and
Affiliates with retirement benefits. The Plan is amended and restated as set
forth herein to comply with Section 409A.


 


This Plan is an unfunded plan
intended to be a nonqualified deferred compensation plan.  This plan will be subject to section 409A of
the Internal Revenue Code of 1986, as amended (the “Code”) for United States
taxpayers.  The amounts that may be
payable under this Plan shall constitute general, unsecured obligations of the
Sponsor, payable solely out of the general assets of the Sponsor, and no Participant
shall have any rights to any specific assets of the Sponsor.  Balances under this Plan represent mere
promises to pay amounts in the future. 
In the event the Sponsor becomes subject to an insolvency or bankruptcy
proceeding, a Participant in the Plan shall only have the rights of a general,
unsecured creditor of the Sponsor for any Balances due under the Plan.


 


ARTICLE 1 - DEFINITIONS


 


1.1                                 “Account Earnings Rate”
means the Moody’s Aa corporate bond yield rate as of the last business day of
the immediately preceding calendar month plus one (1) percent.


 


1.2                                 “Affiliate” means (i) any
subsidiary of the Sponsor, (ii) any entity or person or group of persons
that, directly or through one or more intermediaries, is controlled by the
Sponsor and (iii) any entity or person or group of persons in which the
Sponsor has a significant equity interest, as determined by the Committee.


 


1.3                                 “Annual Bonus” means
the bonus compensation payable to a Participant under an Employer’s annual
bonus plan (determined without regard to any pre-tax salary reduction amounts,
including but not limited to amounts voluntarily deferred under the terms of
this Plan).


 


1.4                                 “Balance” of a
Deferral Account means the total amount which has been credited to such
Deferral Account after the adjustments are made for all intervening debits and
credits.  The initial Balance of a
Deferral Account is zero.


 


1.5                                 “Base Salary” shall
mean the Employee’s total annual regular earnings,  retroactive regular earnings that relate to
the period for which a Deferral Agreement has been timely made, and/or such
other earnings, in each case as timely determined by the Committee, in its sole
discretion, prior the applicable Plan Year (as identified and reported on the
records of Employer).  Base Salary shall
be determined without regard to any pre-tax salary reduction amounts, including
but not limited to amounts voluntarily deferred under the terms of this Plan.
Incentive and supplemental compensation, including but not limited to, bonus
compensation, assignment related allowances and compensation payable under The
AES Corporation 2003 Long Term Compensation Plan, or any 


 


1

















 


successor thereto, are not eligible for benefit purposes under this
Plan and shall not be included in the definition of Base Salary.


 


1.6                                 “Beneficiary” means
the person or persons designated by the Participant on the Participant’s
Beneficiary Designation Form to receive distributions of a Participant’s
Deferral Account Balance under this Plan at the Participant’s death in
accordance with Article 5.


 


1.7                                 “Beneficiary
Designation Form” means a form available to Participants on which a Participant
may designate the Participant’s Beneficiary in accordance with Section 5.1.


 


1.8                                 “Board” means the Board
of Directors of the Sponsor.


 


1.9                                 “Claimant” means a
Participant or Beneficiary who makes a claim for a benefit under the Plan.


 


1.10                           “Code” means the Internal
Revenue Code of 1986, as amended.  A
reference to a section of the Code shall include a reference to any regulations
or other guidance issued under such section.


 


1.11                           “Committee” means the
Compensation Committee of the Board, or such other committee designated by the
Board to discharge the duties of the Committee hereunder.


 


1.12                           “Compensation” means the sum
of the Participant’s Base Salary and Annual Bonus for the Plan Year.


 


1.13                           “Company Matching
Contribution” means the annual notional matching contribution which is credited
to the Participant’s Deferral Account for the Plan Year.


 


1.14                           “Deferral Account” means a
bookkeeping account created for each Participant that may be credited with
Deferral Amounts under Section 3.1, Company Matching Contributions under Section 3.2,
Profit-Sharing Contributions under Section 3.3, and earnings credits under
Section 3.4, and debited for any distributions under Article 4.  The Committee may maintain separate
sub-accounts with respect to each Participant with regard to the Participant’s
Deferral Amounts, Company Matching Contributions, and Profit-Sharing Contributions
in order to properly track such amounts. 
If this is the case, references to a Participant’s “Deferral Account”
shall be deemed to refer to the total of all such sub-accounts as necessary to
properly implement the Plan.


 


1.15                           “Deferral Agreement” means
the agreement between an Employer or the Committee and a Participant, including
any amendments thereto, which specifies the Deferral Amount to be withheld on
behalf of a Participant, subject to any procedures established by the
Committee.  Each Deferral Agreement or
amendment thereto shall be made or confirmed in writing under procedures
established by the Committee.


 


1.16                           “Deferral Amount” means the
whole percentage, up to 50%, by which a Participant’s Base Salary plus the
whole percentage, up to 80%, by which the Annual Bonus is reduced on account of
a Participant’s Deferral Agreement.


 


2

















 


1.17                           “Disability” means (a) the
Participant is unable to engage in any substantial gainful activity by reason
of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period
of not less than 12 months, or (b) the Participant, by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, is receiving income replacement benefits for a period of not
less than three months under an accident and health plan covering employees of
an Employer, or (c) is determined to be totally disabled by the Social
Security Administration.


 


1.18                           “Effective Date” means January 1,
2007.


 


1.19                           “Eligible Employee” means an
Employee who is designated for participation in the Plan by the Committee and
listed in Appendix A hereto (which Appendix A shall be updated from time to
time by the Committee).  An Employee
shall be eligible if the employee is eligible for the career expatriate benefit
policy.  The Committee may, at its sole
discretion, add or delete an Eligible Employee from Appendix A at any
time.  Such amendment of Appendix A shall
not affect an Eligible Employee’s Deferral Agreement for the current Plan Year.


 


1.20                           “Employee” means an
individual who is employed by the Sponsor or an Affiliate.


 


1.21                           “Employer” means the Sponsor
and any Affiliate.


 


1.22                           “Former Participant” means
any Eligible Employee or former Eligible Employee who has ceased to be a
Participant and on whose behalf a Deferral Account continues to be maintained
by the Plan.


 


1.23                           “Key Employee” means a key
employee (as defined in Section 416(i) of the Code without regard to
paragraph (5) thereof) of the Sponsor as determined in accordance with Section 409A
and the procedures established by the Sponsor.


 


1.24                           “Participant” means an
Eligible Employee who becomes a Participant in accordance with Section 2.1.


 


1.25                           “Plan” means the AES
Corporation International Retirement Plan.


 


1.26                           “Plan Year” means the
12-month period ending on the last day of the fiscal year of the Sponsor, which
shall be December 31 of each calendar year.  The first Plan Year begins on January 1,
2007.


 


1.27                           “Profit-Sharing Contribution”
means the annual discretionary notional Profit-Sharing Contribution which may
be added to the Participant’s Deferral Account for a Plan Year.


 


1.28                           “Section 409A” shall
mean Section 409A of the Code, the regulations and other binding guidance
promulgated thereunder.


 


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1.29                           “Sponsor” means The AES
Corporation, a Delaware Corporation, or any successor thereto.


 


1.30                           “Termination of Employment”
means a separation from service (as defined in section 409A(a)(2)(A)(i) of
the Code) from the Sponsor and all of its controlled group members within the
meaning of Section 409A.  For
purposes hereof, the determination of controlled group members shall be made
pursuant to the provisions of Section 414(b) and 414(c) of the
Code; provided that the language “at least 50 percent” shall be used instead of
“at least 80 percent” in each place it appears in Section 1563(a)(1),(2) and
(3) of the Code and Treas. Reg. § 1.414(c)-2; provided, further, where
legitimate business reasons exist (within the meaning of Treas. Reg. §
1.409A-1(h)(3)), the language “at least 20 percent” shall be used instead of “at
least 80 percent” in each place it appears. 
Whether a Participant has a separation from service will be determined
based on all of the facts and circumstances and in accordance with the guidance
issued under Section 409A. For this purpose, a Participant will be
presumed to have experienced a separation from service when the level of bona fide services performed permanently
decreases to a level less than twenty percent (20%) of the average level of bona fide services performed during the
immediately preceding thirty-six (36) month period or such other applicable
period as provided by Section 409A..


 


1.31                           “Unforeseeable Emergency”
means a severe financial hardship to the Participant resulting from an illness
or accident of the Participant, the Participant’s spouse, a beneficiary, or a
dependent (as determined under Section 152(a) of the Code, without
regard to Section 152(b)(1), (b)(2) and (d)(1)(B)) of the
Participant; the need to pay for the funeral expenses of a spouse, beneficiary
or dependent (as defined above); loss of the Participant’s property due to
casualty; or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of the Participant..


 


ARTICLE 2 - ELIGIBILITY AND PARTICIPATION


 


2.1                                 Commencement of
Participation


 


An Eligible Employee shall become a
Participant as of the date he is designated as an Eligible Employee by the
Committee.  An Eligible Employee’s
participation in the Plan shall be effective upon notification to the Eligible
Employee by the Committee of eligibility to participate in the Plan. A
Participant may contribute a Deferral Amount by completing a Deferral Agreement
in accordance with the procedures set forth by the Committee.  The Deferral Agreement shall set forth the
whole percentage of a Participant’s Base Salary or Annual Bonus that shall be
deferred for the applicable Plan Year or portion thereof, subject to such
limits as the Committee may establish.  A
Participant’s Deferral Agreement for a Plan Year shall continue in effect from
Plan Year to Plan Year unless the Participant completes a new Deferral
Agreement (or cancels his Deferral Agreement) in a timely manner in accordance
with the procedures set forth by the Committee.


 


4

















 


2.2                                 Time Limitation for
Deferral Agreement 


 


A Deferral Agreement shall be effective to
defer a Participant’s Base Salary and Annual Bonus only if it is received by
the Committee by December 31 of the calendar year before the calendar year
in which the Participant’s services relating to the Base Salary and Annual
Bonus are to be performed (or at such other earlier times as may be established
by the Committee) or continues in effect from the prior Plan Year as described
in Section 2.1.  Notwithstanding the
provisions of the preceding sentence, if permitted by the Committee, a Deferral
Agreement with respect to a Participant’s Annual Bonus shall be given effect if
made by June 30 of the Plan Year for which the Annual Bonus is to be paid,
provided that the Committee determines that the Annual Bonus satisfies the
requirements for “performance-based compensation” within the meaning of section
409A(a)(4)(B)(iii) of the Code.  In
addition, if a Participant is newly eligible to participate in the Plan in
accordance with section 409A(a)(4)(B)(ii) of the Code, the Participant may
enter into a Deferral Agreement within 30 days of eligibility, provided that
such Deferral Agreement may apply only to Base Salary and Annual Bonus paid for
services performed by the Participant after the date of such Deferral
Agreement.  Accordingly, if a Deferral
Agreement is made in the first-year of eligibility but after the beginning of
the specified performance period (e.g., annual bonus compensation), the
Deferral Agreement shall only apply to the total amount of such Compensation
multiplied by the ratio of (i) the number of days remaining in the
performance period after the election to (ii) the total number of days in
the performance period.


 


2.3                                 Termination of
Participation


 


Once an Eligible Employee becomes a
Participant as set forth in Section 2.1, he shall remain a Participant
until the earliest of: (i) the date of his Termination of Employment or
the date he ceases to be an Eligible Employee, or (ii) the date the
Committee determines that he shall no longer participate in the Plan.  A Former Participant shall nevertheless be
entitled to receive the Balance of his Deferral Account, if any, in accordance
with the Plan.


 


ARTICLE 3 - ACCOUNTS


 


3.1                                 Effect of Deferral
Agreement


 


Commencing with the effective date of a
Participant’s Deferral Agreement, the Participant’s Base Salary shall be
reduced by the Deferral Amount specified in the Deferral Agreement on a ratable
basis over the Plan Year or remainder thereof, and a corresponding amount shall
be credited to the Participant’s Deferral Account as soon as practicable after
the date of each such reduction. 
Similarly, the Participant’s Annual Bonus shall be reduced by the
applicable Deferral Amount specified in the Deferral Agreement for the Plan
Year, and a corresponding amount shall be credited to the Participant’s
Deferral Account as soon as practicable after the date of such reduction.  Notwithstanding the foregoing, a Deferral
Agreement shall automatically terminate if a Participant suffers a disability,
receives a distribution on account of Unforeseeable Emergency or dies. For
purposes of this Section, a disability refers to any medically determinable
physical or mental impairment resulting in the Participant’s inability to
perform the duties of his or her position or any substantially similar
position, where such impairment can be expected to result in death or can be
expected to last for a continuous period of not less than six months.


 


5

















 


3.2                                 Company Matching
Contributions


 


An Employer shall make a Company Matching
Contribution for each Participant who has a Deferral Amount for each Plan
Year.  The amount of the Company Matching
Contribution shall be equal to 100% of the Participant’s Deferral Amount for
the Plan Year up to a maximum of 5.0% of such Participant’s Compensation for
the Plan Year.  The Company Matching
Contribution shall be credited to the Participant’s Deferral Account not later
than the last day of the applicable Plan Year.


 


3.3                                 Profit-Sharing
Contributions


 


An Employer may make a Profit-Sharing
Contribution for each Participant for each Plan Year beginning on or after the
Effective Date during which such Employee was a Participant.  The Participating Employer shall determine
the amount of the Profit-Sharing Contribution in its discretion, and the
Profit-Sharing Contribution shall be credited to the Participant’s Deferral
Account not later than the last day of the applicable Plan Year.  The Profit-Sharing Contribution shall be a
specified percentage of the Base Salary of the Participant.  The Participant’s Annual Bonus shall not be
considered in the calculation of the Profit-Sharing Contribution.


 


3.4                                 Earnings Credits


 


For Plan Years prior to January 1, 2009,
a Participant’s Deferral Account shall be credited at the end of each business
day following its establishment and prior to full distribution with the product
of:  (i) the applicable Account
Earnings Rate, and (ii) the Balance of the Deferral Account as of the
immediately preceding business day (adjusted for any contributions or
distributions, if applicable).  For Plan
Years beginning on or after January 1, 2009, a Participant’s Deferral
Account shall be adjusted by an amount equal to the amount that would have been
earned (or lost) if the amounts deferred under this Plan had been invested in
hypothetical investments designated by the Participant from time to time, based
on a list of hypothetical investments provided by the Committee from time to
time (such hypothetical earnings or losses shall be referred to as “Earnings”).  The Participant shall designate the
investments used to measure Earnings from the list of authorized investments
provided by the Committee by completing the appropriate form (or electronically
via the Plan’s website) or in such other manner as the Committee may designate
from time to time.  The Participant may
change such designations at such times as are permitted by the Committee,
provided that the Participant shall be entitled to change such designations at
least quarterly.  Earnings shall be
credited to the Participant’s Deferral Account at least annually (or more
frequently at the discretion of the Committee). 
Earnings shall be credited to Deferral Account until all payments with
respect to such account have been made under this Plan.  None of the Sponsor, its Affiliates nor the
Committee shall act as a guarantor, or be liable or otherwise responsible for
the investment performance of the designated investments (including any losses
sustained by a Participant) with respect to a Participant’s Deferral Account.


 


ARTICLE 4 - DISTRIBUTION


 


4.1                                 Available Forms of
Distribution


 


The only form of distribution available is a
single lump sum payment.


 


6














 


4.2                                 Distribution
of Deferral Account Balance


 


Subject to Section 4.3
and Section 4.4, a Participant’s Deferral Account Balance shall be
distributed upon the date of the Participant’s Termination of Employment.  Notwithstanding the foregoing or any Plan provision
to the contrary, distributions to Key Employees upon Termination of Employment
for any reason (other than death) may not be made before the date that is
6-months after the date of Termination of Employment.  Any payment otherwise due prior to the 6-month
anniversary of the Participant’s date of Termination of Employment will be
accumulated and paid on the first business day of the seventh month following
the date of Termination of Employment (or, if earlier, the date of death of the
Participant).


 


4.3                                 Unforeseeable
Emergency Distribution


 


Notwithstanding
Section 4.2, in the event a Participant incurs an Unforeseeable Emergency,
the Plan shall distribute the portion of the Participant’s Deferral Account
Balance necessary to satisfy the Unforeseeable Emergency, including any taxes
that are required to be paid as a result of the distribution, after taking into
account the extent to which any emergency may be relieved by insurance or
otherwise, as determined in accordance with section 409A(a)(2)(B)(ii) of
the Code.


 


4.4                                 Death or Disability


 


Notwithstanding
Section 4.2, in the event of a Participant’s Disability or death, the
Participant’s entire Deferral Account Balance shall be distributed to the
Participant or the Participant’s Beneficiary in the form of a lump sum upon the
date of such event.


 


4.5                                 Payment Date


 


For purposes
of Section 409A and the Plan a payment shall be treated as made on the
scheduled payment date if such payment is made at such date or a later date in
the same calendar year or, if later, by the 15th day of the third calendar
month following the scheduled payment date. A Participant shall have no right
to designate the date of any payment under the Plan.


 


ARTICLE 5 - BENEFICIARY DESIGNATION


 


5.1                                 Designation
of Beneficiary and Change of Designation


 


A Participant
shall have the right, at any time, to designate any person or persons as the
Participant’s Beneficiary or Beneficiaries (both primary as well as secondary)
to whom any vested but unpaid benefits under this Plan shall be paid in the
event of the Participant’s death.  Each
Beneficiary designation shall be made on the Beneficiary Designation Form approved
by the Committee, and will be effective only when filed with the Committee
during the Participant’s lifetime.  Any
Beneficiary designation may be changed by the Participant without the consent
of any designated Beneficiary by the filing of a new Beneficiary Designation Form with
the Committee.  The filing of a new
Beneficiary Designation Form will cancel all Beneficiary designations previously
filed.


 


 


7

















 


5.2                                 Absence
of Designation


 


In the absence
of an effective Beneficiary Designation, or if all designated Beneficiaries
predecease a Participant or die prior to complete distribution of the
Participant’s benefits, then the Participant’s designated Beneficiary shall be
deemed to be the Participant’s estate.


 


5.3                                 Payment
to Beneficiary


 


The payment to
a Beneficiary or a deemed Beneficiary shall completely discharge the Sponsor’s
obligations under this Plan.


 


ARTICLE 6 - ADMINISTRATION


 


6.1                                 Duties
and Powers of the Committee


 


The Plan shall
be administered by the Committee.  The
Committee shall establish such rules and procedures as it deems
appropriate for the administration of the Plan.  The Committee shall have the full power,
discretion and authority to interpret, construe and administer the terms of the
Plan, and determine benefits payable hereunder and all decisions made by the
Committee shall be final and binding, including decisions resolving questions
of fact.  The Committee may employ legal
counsel, consultants, actuaries, and others as it deems desirable in the
administration of the Plan.  Actions of
the Committee shall be authorized by majority vote of the participating members
and shall only be valid if recorded in writing in the minutes or resolutions of
Committee meetings (which need not be held in person).


 


6.2                                 Claims
for Benefits


 


A Claimant may bring a claim
for benefits under this Plan by filing a written application for benefits with
the Committee.  The Committee shall
review such claim and shall decide such claim within a reasonable time. The
Committee shall, no later than 90 days after the receipt of a claim (plus an
additional period of 90 days if required for processing, provided that notice
of the extension of time is given to the claimant within the first 90-day
period), either allow or deny the claim in writing.  If a claimant does not receive written notice
of the Committee’s decision on his claim within the above-mentioned period, the
claim shall be deemed to have been denied in full.


 


A denial of a claim by the
Committee, wholly or partially, shall be written in a manner calculated to be
understood by the claimant and shall include: the specific reasons for the denial;
specific reference to pertinent Plan provisions on which the denial is based; a
description of any additional material or information necessary for the
claimant to perfect the claim and an explanation of why such material or
information is necessary; and an explanation of the claim review procedure and
the time limits applicable to such procedures, including a statement of the
claimant’s right to bring a civil action under Section 502(a) of ERISA.


 


A claimant whose claim is
denied (or his duly authorized representative) may within 60 days after receipt
of denial of a claim file with the Committee a written request for a review of
such claim.  If the claimant does not
file a request for review of his claim within such 60-day period, the claimant
shall be deemed to have acquiesced in the original decision of the Committee on
his claim, the decision shall become final and the claimant will not be
entitled to bring a civil action under Section 502(a) of ERISA.  If such an appeal is so filed within such
60-day period, the Sponsor (or its delegate) shall conduct a full and fair
review of such claim.  During such
review, 


 


8

















 


the claimant (or the claimant’s
authorized representative) shall be given the opportunity to review all
documents that are pertinent to his claim and to submit issues and comments in
writing.


 


The Sponsor shall mail or
deliver to the claimant a written decision on the matter based on the facts and
the pertinent provisions of the Plan within 60 days after the receipt of the
request for review (unless special circumstances require an extension of up to
60 additional days, in which case written notice of such extension shall be
given to the claimant prior to the commencement of such extension).  Such decision shall be written in a manner
calculated to be understood by the claimant, shall state the specific reasons
for the decision and the specific Plan provisions on which the decision was
based and shall, to the extent permitted by law, be final and binding on all
interested persons.  If the decision on
review is not furnished to the claimant within the above-mentioned time period,
the claim shall be deemed to have been denied on review.  If a claimant’s claim for benefits is denied
in whole or in part, the claimant may file suit in a state or federal court. Notwithstanding the aforementioned,
before the claimant may file suit in a state or federal court, the claimant must
exhaust the Plan’s administrative claims procedure set forth in this Article VI.  If any such state or federal judicial or
administrative proceeding is undertaken, the evidence presented will be
strictly limited to the evidence timely presented to the Sponsor.  In addition, any such state or federal
judicial or administrative proceeding must be filed within six (6) months
after the Sponsor’s final decision. In addition, any such state or federal
judicial or administrative proceeding relating to this Plan shall only be
brought in the Circuit Court for Arlington County, Virginia or in the United
States District Court for the Eastern District of Virginia, Alexandria
Division.  If any such action or proceeding is brought in any other
location, then the filing party expressly consents to the transfer of such
action to the Circuit Court for Arlington County, Virginia or the United States
District Court for the Eastern District of Virginia, Alexandria Division. 
Nothing in this clause shall be deemed to prevent any party from removing an
action or proceeding to enforce or interpret this Plan from the Circuit Court
for Arlington County, Virginia to the United States District Court for the
Eastern District of Virginia, Alexandria Division.


 


ARTICLE 7 - MISCELLANEOUS


 


7.1                                 No
Contract of Employment


 


This Plan is not intended to constitute a contract of employment, and
the Sponsor and any Affiliate retain the right to discharge or discipline any
Employee for any reason.


 


7.2                                 Funding


 


The amounts
that may be payable under this Plan shall constitute general, unsecured
obligations of the Sponsor, payable solely out of the general assets of the
Sponsor, and no Participant shall have any rights to any specific assets of the
Sponsor.  Balances under this Plan
represent mere promises to pay amounts in the future.  In the event the Sponsor becomes subject to an
insolvency or bankruptcy proceeding, a Participant in the Plan shall only have
the rights of a general, unsecured creditor of the Sponsor for any Balances due
under the Plan.


 


9

















 


7.3                                 Liability
of Sponsor


 


Subject to its
obligation to pay Balances of Participants’ Accounts pursuant to the terms of
this Plan, neither the Sponsor nor anyone acting on behalf of the Sponsor shall
be liable for any act performed or the failure to perform any act with regard
to this Plan, except as otherwise required by law.


 


7.4                                 Notices


 


Each
Participant or Beneficiary shall be responsible for furnishing the Committee
with the current and proper address for the mailing of notices.  Any notice required or permitted to be given
shall be deemed given if directed to the person to whom addressed.


 


7.5                                 Binding
Effect


 


The terms of
this Plan shall be binding on the Participants, their Beneficiaries, and their
legal representatives, and on the Sponsor and any Affiliate, and their
successors, assigns, and legal representatives.


 


7.6                                 Non-alienation


 


None of the
payments, benefits or rights of any Participant or Beneficiary shall be subject
to the claims of any creditor, and, in particular, to the fullest extent
permissible by law, all such payments, benefits and rights shall be free from
attachment, garnishment, trustee’s process or any other legal or equitable
process available to any creditor of such Participant or Beneficiary.


 


7.7                                 Incapacity


 


If the
Committee determines that a Participant or Beneficiary is incompetent by reason
of legal minority or physical or mental disability, the Committee shall have
the power to cause the payments becoming due to such person to be made to
another for the benefit of the minor or incompetent, without responsibility of
the Sponsor or the Committee to see to the application of such payment.  Payments made in accordance with the
application of such power shall operate as a complete discharge of all
obligations of the Sponsor and the Committee to the extent of such payment.


 


7.8                                 Amendment
or Termination


 


This Plan may
be amended or terminated, in whole or in part, at any time by action of the
Sponsor in writing.  No amendment or
termination of the Plan shall deprive any Participant of any portion of his
Deferral Account Balance as of the date of such amendment or termination.  Notwithstanding the foregoing or any
provision of the Plan to the contrary, the Sponsor may at any time (in its sole
discretion and without the consent of any Participant) modify, amend or terminate
any or all of the provisions of this Plan or take any other action  to the extent necessary to conform the
provisions of the Plan with Section 409A regardless of whether such
modification, amendment or termination of this Plan or other action shall
adversely affect the rights of a Participant under the Plan.  Termination of this Plan shall not be a
distribution event under the Plan unless otherwise permitted under Section 409A.


 


10

















 


7.9                                 Other
Plans


 


Nothing
contained in this Plan shall preclude a Participant, to the extent he is
otherwise eligible, from participation in any group insurance, pension,
savings, or other employee benefit plans or programs which the Sponsor or an
Affiliate in its discretion may make available to its employees, but the
Sponsor or the Affiliate shall not be required to establish, maintain or
continue any such plan or program by reason of this Plan.  Any amounts payable under this Plan shall not
be deemed to be salary, bonus or other compensation paid to a Participant for
purposes of computing contributions to or benefits under any other employee
benefit plan or program, unless specifically required pursuant to such other
plan or program.


 


7.10                           Integrated
Agreement


 


This Plan document
represents the entire agreement between the Employer and the Participants
concerning the subject matter hereof.


 


7.11                           Severability


 


If any
provision of this Plan shall be held invalid or unenforceable, such invalidity
or unenforceability shall not affect any other provision hereof, and this Plan
shall be construed and enforced as if such provision had not been included.


 


7.12                           Construction


 


The masculine
gender includes the feminine, and the singular the plural, and vice versa,
unless the context clearly requires otherwise. 
The headings and captions contained herein are provided for convenience
only, shall not be considered part of the Plan, and shall not be employed in
construction of the Plan.


 


7.13                           Code Section 409A
Compliance


 


This Plan is
intended to comply with the provisions of Section 409A and shall be
administered, interpreted and construed accordingly (or disregarded to the
extent such provision cannot be so administered, interpreted or
construed).  With respect to payments
subject to Section 409A: (i) it is intended that distribution events
authorized under the Plan qualify as permissible distribution events for
purposes of Section 409A; and (ii) the Sponsor reserve the right to
accelerate and/or defer any payment to the extent permitted and consistent with
Section 409A.  Notwithstanding any provision of this Plan to the
contrary, to the extent the timing of any benefit payment due under this Plan
was modified pursuant to the transition guidance provided by the Internal
Revenue Service concerning the time and form of payment, any such modification
shall only apply to amounts that would not otherwise be payable in 2008 and may
not cause an amount to be paid in 2008 that would not otherwise be paid in
2008.  To the extent any such payment
cannot be made in 2008 under the transition guidance, such payment will be made
in January 2009.  Notwithstanding
any provision of the Plan to the contrary, in no event shall the Committee, the
Sponsor or an Affiliate (or their employees, officers, directors, members or
affiliates) have any liability to any Participant (or any other person) due to
the failure of the Plan to satisfy the requirements of Section 409A.


 


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IN WITNESS WHEREOF, and
intending to be legally bound hereby, The AES Corporation has caused its
authorized officer to execute this amended and restated document this 29 day of
December 2008.


 


	
   

  	
  The AES CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jay L.
  Kloosterboer

  
	
   

  	
  Jay L. Kloosterboer, Executive Vice President, Business Excellence 

  



 


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