Exhibit 10.3


 


CALIFORNIA COASTAL
COMMUNITIES, INC. RETIREMENT PLAN


AMENDMENT
NO. 1


The California Coastal Communities, Inc. Retirement
Plan (“Plan”), which was executed December 21, 2001, and which has been amended
for EGTRRA in a separate amendment, is hereby further amended by this Amendment
No. 1, in order to incorporate changes required as part of the IRS
determination letter process.  This
Amendment No. 1 does not amend the EGTRRA Amendment, which was executed on
December 19, 2001.


1.     Effective
January 1, 1997, a new Section 1.30A is added to the Plan to read as follows:


Highly Compensated
Employee.  “Highly
Compensated Employee” means (a) any 5% owner during the current Plan Year or
the preceding Plan Year (“look back year”), and (b) any Employee receiving
Compensation within the meaning of Section 6.1 of the Plan in the look back
year in excess of $80,000, as indexed pursuant to Code Section 414(q).


 


2.     Effective
January 1, 1995, a new  Section 6.3.3 is
added to the Plan, to read as follows:


GATT.


Effective December 31, 1993, benefit accruals under this Plan were
frozen.  Consequently, this Section 6.3.3
is to apply prospectively, only, to benefits (if any) accrued under the Plan
after the date (if ever) that benefit accruals under the Plan cease to be
frozen and after December 31, 1994 (the “GATT effective date”).


For purposes of applying Code Section 415(b) to a benefit that is not
payable in the form of an annual straight life annuity within the meaning of
Code Section 415(b)(2)(A) and that is not subject to Code Section 417(e)(3),
the equivalent annual benefit determined in Step 1, below will be no greater
than the lesser of the age-adjusted dollar limit determined in Step 2 below and
the Code Section 415(b) compensation limitation determined in Step 3, below.









 



 


STEP1:  Under Code Section
415(b)(2)(B), determine the annual benefit in the form of a straight life
annuity commencing at the same age that is actuarially equivalent to the plan
benefit.  This equivalent annual benefit
will be the greater of the equivalent annual benefit computed using the
interest rate and mortality table outlined in the Plan’s definition of
Actuarial Equivalent, and the equivalent annual benefit computed using a 5%
interest rate assumption and the Applicable Mortality Table under Section
417(e) of the Code.  This step will not
apply to a benefit that is not required to be converted to a straight life
annuity pursuant to Code Section 415(b)(2)(B) (for example a qualified joint
and survivor annuity).


STEP 2:  Under Code Section
415(b)(2)(C) or (D), determine the Code Section 415(b) dollar limitation that
applies at the age the benefit is payable (age-adjusted dollar limit).  The age-adjusted dollar limit will be the
annual benefit that is actuarially equivalent to an annual benefit equal to the
Code Section 415(b) dollar limitation payable at the participant’s Social
Security Retirement Age.


If the age at which the benefit is payable is 62 or greater, and less
than the participant’s Social Security Retirement Age, the age-adjusted dollar
limit will be as determined for this age pursuant to Section 6.3.2 of the Plan.


If the age at which the benefit is payable is less than 62, the reduced
age-adjusted dollar limit will be the lesser of the equivalent amount computed
under Section 6.3.2 of the Plan for this age and the amount computed using 5%
interest and the Applicable Mortality Table under Section 417(e) of the
Code.  To the extent a forfeiture does
not occur upon death, the mortality decrement may be ignored prior to age 62
and must be ignored after Social Security Retirement Age.


If the age at which the benefit is payable is greater than the
participant’s Social Security Retirement Age, the increased age-adjusted dollar
limit will be the lesser of the equivalent amount computed under Section 6.3.2
of the Plan for this age and the equivalent amount computed using 5% interest
and the Applicable Mortality Table under Code Section 417(e).



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STEP 3:  Determine the
participant’s Code Section 415(b) compensation limitation.  This limitation is equal to the participant’s
compensation (within the meaning of Section 6.1 of the Plan) averaged over the
consecutive 3-year period producing the highest average, as provided in Code
Section 415(b)(3).


 


IN WITNESS WHEREOF, this
Amendment No. 1 is executed this 26 day of June, 2002.


 


	
  

  	
  California
  Coastal Communities, Inc.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  //s// R J Pacini

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Raymond J.
  Pacini

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  President and

  	
   

  
	
   

  	
  Chief Executive
  Officer

  	
   

  
					



 



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