Document:

Filed by Bowne Pure Compliance

Exhibit 10.35

DYNEGY MIDWEST GENERATION, INC. 401(k) SAVINGS PLAN FOR

EMPLOYEES COVERED UNDER A COLLECTIVE BARGAINING

AGREEMENT

As Amended and Restated

Effective January 1, 2009

 

 

 

DYNEGY MIDWEST GENERATION, INC. 401(k) SAVINGS PLAN FOR EMPLOYEES

COVERED UNDER A COLLECTIVE BARGAINING AGREEMENT

WITNESSETH:

WHEREAS, Dynegy Inc., a Delaware corporation, (“Dynegy”) has heretofore adopted the Dynegy
Midwest Generation, Inc. 401(k) Savings Plan for Employees Covered Under a Collective Bargaining
Agreement, hereinafter referred to as the “Plan” for the benefit of its eligible employees;

WHEREAS, Dynegy desires to amend the Plan in several respects and to restate the Plan,
intending thereby to provide an uninterrupted and continuing program of benefits; and

WHEREAS, the Plan is hereby restated in its entirety as follows with no interruption in time,
effective as of January 1, 2009, except as otherwise indicated herein.

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	I. DEFINITIONS AND CONSTRUCTION
	 	 	1	 
	1.1 Definitions
	 	 	1	 
	1.2 Number and Gender
	 	 	11	 
	1.3 Headings
	 	 	11	 
	1.4 Construction
	 	 	11	 
	 
	 	 	 	 
	II. PARTICIPATION
	 	 	11	 
	2.1 Eligibility
	 	 	11	 
	2.2 Transferred Employees
	 	 	12	 
	 
	 	 	 	 
	III. CONTRIBUTIONS
	 	 	12	 
	3.1 Before-Tax Contributions
	 	 	12	 
	3.2 After-Tax Contributions
	 	 	15	 
	3.3 Employer Matching Contributions
	 	 	16	 
	3.4 Employer Discretionary Contributions
	 	 	17	 
	3.5 Employer Discretionary Qualified Matching Contributions
	 	 	17	 
	3.6 Restrictions on Employer Matching Contributions and After-Tax Contributions
	 	 	18	 
	3.7 Return of Contributions
	 	 	18	 
	3.8 Disposition of Excess Deferrals and Excess Contributions
	 	 	19	 
	3.9 Rollover Contributions
	 	 	21	 
	 
	 	 	 	 
	IV. ALLOCATIONS AND LIMITATIONS
	 	 	22	 
	4.1 Allocation of Contributions to Accounts
	 	 	22	 
	4.2 Application of Forfeitures
	 	 	24	 
	4.3 Valuation of Accounts
	 	 	24	 
	4.4 Limit on Annual Additions Under Section 415
	 	 	24	 
	4.5 Recharacterizations
	 	 	25	 
	 
	 	 	 	 
	V. INVESTMENT OF ACCOUNTS
	 	 	25	 
	5.1 Investment of ESOP Subaccounts
	 	 	25	 
	5.2 Investment of Certain Employer Contributions
	 	 	25	 
	5.3 Investment of Accounts
	 	 	26	 
	5.4 VBO Investments
	 	 	26	 
	5.5 Pass-Through Voting and Other Rights with Respect to Company Stock
	 	 	27	 
	5.6 Stock Splits and Stock Dividends
	 	 	27	 
	 
	 	 	 	 
	VI. ESOP AND ESOP ALLOCATIONS
	 	 	27	 
	6.1 Article Controls
	 	 	27	 
	6.2 Purpose of ESOP
	 	 	27	 
	6.3 Nature of the ESOP
	 	 	27	 
	6.4 Requirements as to Exempt Loan
	 	 	28	 
	6.5 Use of Exempt Loan Proceeds
	 	 	29	 

 

i

 

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	6.6 Loan Repayment Contributions
	 	 	29	 
	6.7 Release and Allocation of Financed Stock
	 	 	29	 
	6.8 Investment of Accounts
	 	 	30	 
	6.9 Dividends
	 	 	31	 
	6.10 “Put” Option
	 	 	31	 
	6.11 Right of First Refusal
	 	 	32	 
	6.12 Investment of Trust Fund in Company Stock
	 	 	33	 
	6.13 Company Stock Valuation
	 	 	33	 
	 
	 	 	 	 
	VII. GENERAL BENEFITS
	 	 	34	 
	7.1 No Benefits Unless Herein Set Forth
	 	 	34	 
	7.2 Severance from Employment Benefit
	 	 	34	 
	7.3 Disability Benefit
	 	 	34	 
	7.4 Vesting of Accounts
	 	 	34	 
	 
	 	 	 	 
	VIII. DEATH BENEFITS
	 	 	34	 
	8.1 Death Benefits
	 	 	34	 
	8.2 Designation of Beneficiaries
	 	 	34	 
	 
	 	 	 	 
	IX. PAYMENT OF BENEFITS
	 	 	35	 
	9.1 Determination of Benefit Commencement Date
	 	 	35	 
	9.2 Minimum Distribution Requirements
	 	 	36	 
	9.3 Form of Payment and Payee
	 	 	40	 
	9.4 Direct Rollover Election
	 	 	41	 
	9.5 Transfers to Salaried Plan
	 	 	41	 
	9.6 Notice of Direct Rollover Distribution
	 	 	42	 
	9.7 Unclaimed Benefits
	 	 	42	 
	9.8 Claims Review
	 	 	42	 
	 
	 	 	 	 
	X. IN-SERVICE WITHDRAWALS
	 	 	46	 
	10.1 In-Service Withdrawals
	 	 	46	 
	10.2 Restriction on In-Service Withdrawals
	 	 	48	 
	 
	 	 	 	 
	XI. LOANS
	 	 	49	 
	 
	 	 	 	 
	XII. ADMINISTRATION OF THE PLAN
	 	 	49	 
	12.1 General Administration of the Plan
	 	 	49	 
	12.2 Records and Procedures
	 	 	49	 
	12.3 Meetings
	 	 	50	 
	12.4 Self-Interest of Members
	 	 	50	 
	12.5 Compensation and Bonding
	 	 	50	 
	12.6 Committee Powers and Duties
	 	 	50	 
	12.7 Employer to Supply Information
	 	 	51	 
	12.8 Temporary Restrictions
	 	 	52	 
	12.9 Indemnification
	 	 	52	 

 

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	 	 	PAGE	 
	 
	 	 	 	 
	XIII. TRUSTEE AND ADMINISTRATION OF TRUST FUND
	 	 	52	 
	13.1 Trust Agreement
	 	 	52	 
	13.2 Payment of Expenses
	 	 	52	 
	13.3 Trust Fund Property
	 	 	53	 
	13.4 Distributions from Participants’ Accounts
	 	 	53	 
	13.5 Payments Solely front Trust Fund
	 	 	53	 
	13.6 No Benefits to Company/Employer
	 	 	53	 
	 
	 	 	 	 
	XIV. FIDUCIARY PROVISIONS
	 	 	53	 
	14.1 Article Controls
	 	 	53	 
	14.2 General Allocation of Fiduciary Duties
	 	 	53	 
	14.3 Delegation of Fiduciary Duties
	 	 	54	 
	14.4 Investment Manager
	 	 	54	 
	14.5 Independent Fiduciary
	 	 	54	 
	 
	 	 	 	 
	XV. AMENDMENTS
	 	 	55	 
	15.1 Right to Amend
	 	 	55	 
	15.2 Limitation on Amendments
	 	 	56	 
	 
	 	 	 	 
	XVI. DISCONTINUANCE OF CONTRIBUTIONS, TERMINATION, PARTIAL TERMINATION, AND MERGER OR CONSOLIDATION
	 	 	56	 
	16.1 Right to Discontinue Contributions, Terminate, or Partially Terminate
	 	 	56	 
	16.2 Procedure in the Event of Discontinuance of Contributions, Termination,
or Partial Termination
	 	 	56	 
	16.3 Merger, Consolidation, or Transfer
	 	 	57	 
	 
	 	 	 	 
	XVII. PARTICIPATING EMPLOYERS
	 	 	57	 
	17.1 Designation of Other Employers
	 	 	57	 
	17.2 Single Plan
	 	 	58	 
	 
	 	 	 	 
	XVIII. MISCELLANEOUS PROVISIONS
	 	 	58	 
	18.1 Not Contract of Employment
	 	 	58	 
	18.2 Spendthrift Clause
	 	 	59	 
	18.3 Uniformed Services Employment and Reemployment Rights Act Requirements
	 	 	60	 
	18.4 Payments to Minors and Incompetents
	 	 	60	 
	18.5 Acquisition and Holding of Company Stock
	 	 	61	 
	18.6 Power of Attorney Designations
	 	 	61	 
	18.7 Participant’s and Beneficiary’s Addresses
	 	 	61	 
	18.8 Incorrect Information, Fraud, Concealment, or Error
	 	 	61	 
	18.9 Severability
	 	 	61	 
	18.10 Jurisdiction
	 	 	61	 
	 
	 	 	 	 
	Appendix A: Participating Employers
	 	 	 	 
	 
	 	 	 	 
	Appendix B: Loan Policy
	 	 	 	 

 

iii

 

I.

DEFINITIONS AND CONSTRUCTION

1.1 Definitions. Where the following words and phrases appear in the Plan, they shall
have the respective meanings set forth below, unless their context clearly indicates to the
contrary.

(a) Account(s): A Participant’s After-Tax Account, Before-Tax Account, Employer
Contribution Account, Rollover Contribution Account, Catch-Up Contribution Account, TRASOP Transfer
Account, Class Settlement Account, and/or Roth Account, including the amounts credited thereto.

(b) Act: The Employee Retirement Income Security Act of 1974, as amended.

(c) After-Tax Account: An individual account for each Participant, which is credited
with (i) all After-Tax Contributions held in such account on the Effective Date, and (ii) all
amounts of After-Tax Contributions that are deferred and/or accrued after the Effective Date. Such
Account shall also be adjusted to reflect changes in value as provided in Section 4.3.

(d) After-Tax Contributions: Contributions made to the Plan by a Participant in
accordance with Section 3.2.

(e) Before-Tax Account: An individual account for each Participant, which is credited
with (i) all Before-Tax Contributions made by the Employer on such Participant’s behalf in such
account on the Effective Date, (ii) all amounts of Before-Tax Contributions deferred and/or accrued
after the Effective Date, and (iii) the Employer Discretionary Qualified Matching Contributions, if
any, made on such Participant’s behalf pursuant to Section 3.5 to satisfy the restrictions set
forth in Section 3.1(e) in such account. Such Account shall also be adjusted to reflect changes in
value as provided in Section 4.3.

(f) Before-Tax Contributions: Contributions made to the Plan by the Employer on a
Participant’s behalf in accordance with the Participant’s elections to defer Compensation under the
Plan’s qualified cash or deferred arrangement as described in Section 3.1.

(g) Benefit Commencement Date: With respect to each Participant or beneficiary, the
date such Participant’s or beneficiary’s benefit is paid to him from the Trust Fund as determined
in accordance with Section 9.1.

(h) Catch-Up Contribution Account: An individual account for each Participant which
is credited with Catch-Up Contributions made in accordance with Section 3.1(h) of the Plan. Such
Account shall also be adjusted to reflect changes in value as provided in Section 4.3.

(i) Catch-Up Contributions: Contributions made to the Plan by the Employer on a
Participant’s behalf in accordance with the Participant’s elections to defer Compensation under the
Plan’s qualified cash or deferred arrangement as described in Section 3.1(h).

 

1

 

(j) Class Settlement Account: A separate account established for each person who is
an Allocation Participant (as defined below) that is credited by the Trustee with the respective
restorative payment awarded to such Allocation Participant pursuant to the Stipulation and
Agreement of Settlement approved by the United States District Court for the Southern District of
Texas, Houston Division, in the matter of In re Dynegy Inc. Securities Litigation, Civil Action No.
H-02-1571. For purposes of this Section 1.1(j), the term “Allocation Participant” shall mean each
Participant and former Participant and each beneficiary (or alternate payee) of a Participant or
former Participant who is within the Settlement Class as defined in the Stipulation and Agreement
of Settlement and who shall be deemed to be a Participant or beneficiary (or alternate payee) under
the Plan to the extent necessary or appropriate, including, but not limited to, with respect to the
unclaimed benefit provisions under Article IX of the Plan. The amounts credited to a Class
Settlement Account shall be fully vested. If the Trustee receives settlement proceeds in the form
of Company Stock to be allocated to the Class Settlement Account of each Allocation Participant,
such Company Stock shall be invested in the Company Stock Fund until the Allocation Participant
directs to change such investment pursuant to Section 5.3(c). If the Trustee receives cash
settlement proceeds to be allocated to the Class Settlement Account of each Allocation Participant,
during the period prior to such allocation, such settlement proceeds shall be invested in the
Vanguard Prime Money Market Fund. Notwithstanding the provisions of Section 5.3(a) of the Plan,
cash settlement proceeds in the Class Settlement Account of each Allocation Participant shall be
invested in accordance with Paragraph (1) or (2) below, as applicable, until the Allocation
Participant directs to change such investment pursuant to Section 5.3(c):

(1) If an Allocation Participant is an Eligible Employee with an existing Account
balance in the Plan and is either currently contributing to the Plan or previously
contributed to the Plan, such Allocation Participant’s cash settlement proceeds in the Class
Settlement Account shall be invested in accordance with such Allocation Participant’s most
recent investment direction for contributions to the Plan; or

(2) If an Allocation Participant is not described in Paragraph (1) above, the cash
proceeds in the Class Settlement Account of such Allocation Participant shall be invested in
the appropriate Investment Fund set forth below as determined on the basis of the age of the
Allocation Participant, unless such Allocation Participant is the beneficiary (or alternate
payee) of a Participant or former Participant, in which case the attained age of such
Participant or former Participant, whether or not deceased, shall be used instead of the age
of the Allocation Participant:

	 	 	 
	 	 	Age of Participant or Former
	Fund Name	 	Participant
	Vanguard Target Retirement
Income Fund
	 	Ages 65 or older
	Vanguard Target Retirement
2005 Fund
	 	Ages 60 to 64
	Vanguard Target Retirement
2015 Fund
	 	Ages 50 to 59
	Vanguard Target Retirement
2025 Fund
	 	Ages 40 to 49
	Vanguard Target Retirement
2035 Fund
	 	Ages 30 to 39
	Vanguard Target Retirement
2045 Fund
	 	Up to Age 29

 

2

 

(k) Code: The Internal Revenue Code of 1986, as amended.

(l) Committee: The Dynegy Inc. Benefit Plans Committee.

(m) Company: Dynegy Inc., a Delaware corporation, and any successor thereto.

(n) Company Stock: The Class A common stock, $0.01 par value, of the Company.

(o) Company Stock Fund: An Investment Fund established to invest in Company Stock and
such reserves of cash or cash equivalents as are necessary to meet the liquidity needs of the fund.

(p) Compensation: The regular or base salary or wages (but (i) including regular or
base salary or wages paid during a military leave of absence, and (ii) excluding overtime payments
and bonuses (other than that described below)) paid by the Employer to or for the benefit of a
Participant for services rendered or labor performed for the Employer while a Participant and an
Eligible Employee, provided that the following items shall be included as “Compensation:”

(1) Any amounts subject to a deferral election pursuant to Section 3.1 of the Plan;

(2) Elective contributions made on a Participant’s behalf by the Employer that are not
includible in income under Sections 125, 402(e)(3), 402(h), or 403(b) of the Code and any
amounts that are not includible in the gross income of a Participant under a salary
reduction agreement by reason of the application of Section 132(f) of the Code;

(3) Compensation deferred under an eligible deferred compensation plan within the
meaning of Section 457(b) of the Code;

(4) Employee contributions described in Section 414(h) of the Code that are picked up
by the employing unit and are treated as employer contributions; and

(5) If a Participant is scheduled to work a 12 hour shift, the regularly scheduled
overtime will be included as Compensation, and is calculated by multiplying his straight
time hourly rate of pay by the number of 12 hour shift regularly scheduled
overtime hours for which he is paid, but excluding any other contributions or benefits
under this Plan or any other pension, profit sharing, insurance, hospitalization or other
plan or policy maintained by an Employer for the benefit of such Participant, bonuses,
overtime, commissions, and all other extraordinary and unusual payments.

 

3

 

Notwithstanding the foregoing, the Compensation of any Participant taken into account for
purposes of the Plan shall be limited to $245,000 for any Plan Year with such limitation to
be (i) adjusted automatically to reflect any amendments to Section 401(a)(17) of the Code
and any cost-of-living increases authorized by Section 401(a)(17) of the Code, and (ii)
prorated for a Plan Year of less than twelve months and to the extent otherwise required by
applicable law.

(q) Compensation Committee: The Compensation and Human Resources Committee of the
Board of Directors of the Company.

(r) Controlled Entity: Each corporation that is a member of a controlled group of
corporations, within the meaning of Section 414(b) of the Code, of which the Company or the
Employer is a member, each trade or business (whether or not incorporated) with which the Company
or the Employer is under common control, within the meaning of Section 414(c) of the Code, and each
member of an affiliated service group, within the meaning of Section 414(m) of the Code, of which
the Company or the Employer is a member.

(s) Directors: The Board of Directors of the Company.

(t) Direct Rollover: A payment by the Plan to an Eligible Retirement Plan designated
by a Distributee.

(u) Distributee: Each (i) Participant entitled to an Eligible Rollover Distribution,
(ii) Participant’s surviving spouse with respect to the interest of such surviving spouse in an
Eligible Rollover Distribution, and (iii) former spouse of a Participant who is an alternate payee
under a qualified domestic relations order, as defined in Section 414(p) of the Code, with regard
to the interest of such former spouse in an Eligible Rollover Distribution. Notwithstanding the
previous sentence, effective January 1, 2008, Distributee shall also include a non-spouse
beneficiary, but only with regard to the Participant’s interest under the Plan.

(v) Effective Date: January 1, 2009, as to this restatement of the Plan, except (i)
as otherwise indicated in specific provisions of the Plan, and (ii) that provisions of the Plan
required to have an earlier effective date by applicable statute and/or regulation shall be
effective as of the required effective date in such statute and/or regulation and shall apply, as
of such required effective date, to any plan merged into this Plan. The original effective date of
the Plan was January 1, 1987.

 

4

 

(w) Eligible Employee: Each Employee employed as a member of a group to whom the Plan
has been and continues to be extended through a currently effective collective bargaining agreement
between his Employer and the collective bargaining representative of the group of employees of
which he is a member; provided, however, that the term “Eligible Employee” shall not include:

(1) A nonresident alien who receives no earned income from the Employer that
constitutes income from sources within the United States,

(2) A Leased Employee,

(3) An individual who is deemed to be an Employee pursuant to Treasury Regulations
issued under Section 414(o) of the Code,

(4) An Employee who has waived participation in the Plan through any means including,
but not limited to, an Employee whose employment is governed by a written agreement with the
Employer (including an offer letter setting forth the terms and conditions of employment)
that provides that the Employee is not eligible to participate in the Plan (a general
statement in the agreement, offer letter, or other communication stating that the Employee
is not eligible for benefits shall be construed to mean that the Employee is not an Eligible
Employee), or

(5) An Employee of an entity that has been designated to participate in the Plan
pursuant to the provisions of Article XVI to the extent that such entity’s designation
specifically excepts such Employee’s participation.

Notwithstanding any provision of the Plan to the contrary, no individual who is designated,
compensated, or otherwise classified or treated by the Employer as an independent contractor
or other non-common law employee shall be eligible to become a Participant in the Plan. It
is expressly intended that individuals not treated as common law employees by the Employer
are to be excluded from Plan participation even if a court or administrative agency
determines that such individuals are common law employees.

(x) Eligible Retirement Plan: Any of (i) an individual retirement account described
in Section 408(a) of the Code, (ii) an individual retirement annuity described in Section 408(b) of
the Code, (iii) an annuity plan described in Section 403(a) of the Code, (iv) a qualified plan
described in Section 401(a) of the Code, which under its provisions does, and under applicable law
may, accept a Distributee’s Eligible Rollover Distribution, (v) an annuity contract described in
Section 403(b) of the Code, (vi) an eligible plan under Section 457(b) of the Code which is
maintained by a state, political subdivision of a state, or agency or instrumentality of a state or
political subdivision of a state and which agrees to separately account for the amounts transferred
into such plan from the Plan, and (vii) effective January 1, 2008, a Roth IRA described in Section
408A(b) of the Code. 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 an alternate payee under
a qualified domestic relations order, as defined in Section 414(p) of the Code.

Notwithstanding the foregoing, effective January 1, 2008, in the case of an Eligible Rollover
Distribution to a beneficiary who is a designated beneficiary as defined in Section 401(a)(9)(E) of
the Code and is not a surviving spouse, an Eligible Retirement Plan is limited to an individual
retirement account or individual retirement annuity established for purposes of receiving the
distribution that is treated as an inherited account under Section 402(c)(11) of the Code. If the
designated beneficiary is a trust, an Eligible Retirement Plan is limited to an individual
retirement account created on behalf of the trust that satisfies the requirements to be a
designated beneficiary within the meaning of Section 401(a)(9)(E) of the Code.

 

5

 

(y) Eligible Rollover Distribution: With respect to a Distributee, any distribution of
all or any portion of the Accounts of a Participant other than (i) a 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 (10)
years or more, (ii) a distribution to the extent such distribution is required under Section
401(a)(9) of the Code, (iii) the portion of a distribution that is not includible in gross income
(determined without regard to the exclusion for net unrealized appreciation with respect to
employer securities), (iv) a loan treated as a distribution under Section 72(p) of the Code and not
excepted by Section 72(p)(2), (v) a loan in default that is a deemed distribution, (vi) any
corrective distribution provided in Sections 3.8 and 4.4(c), (vii) a distribution pursuant to
Section 10.1(g), and (viii) any other distribution so designated by the Internal Revenue Service in
revenue rulings, notices, and other guidance of general applicability.

Notwithstanding the foregoing or any other provision of the Plan, a portion of a distribution shall
not fail to be an Eligible Rollover Distribution merely because the portion consists of after-tax
employee contributions which are not includible in gross income; provided, however, that such
portion may be transferred only to an individual retirement account or annuity described in
Section 408(a) or (b) of the Code or to a qualified defined contribution plan described in Section
401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred,
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.

Notwithstanding the foregoing or any other provision of the Plan, an Eligible Rollover Distribution
to a nonspouse beneficiary is not subject to the direct rollover requirements of Section 401(a)(31)
of the Code, the notice requirements of Section 402(f) of the Code or the mandatory withholding
requirements of Section 3405(c) of the Code. If a nonspouse beneficiary receives an Eligible
Rollover Distribution from the Plan, the distribution is not eligible for a “60-day” rollover.

(z) Employee: Each (i) individual employed by the Employer (as reported on the
Employer’s payroll records and for whom the Employer has FICA taxes withheld), and (ii) Leased
Employee.

(aa) Employer: Dynegy Midwest Generation, Inc. and each entity listed on Appendix A
that has been designated to participate in the Plan pursuant to the provisions of Article XVII.
The Company is not an Employer.

(bb) Employer Contribution Account: An individual account for each Participant, which
is comprised of the following subaccounts: 

(1) ESOP Subaccount: The portion of a Participant’s Employer Contribution
Account that, except to the extent provided otherwise in accordance with an election by a
Participant pursuant to Section 6.8(b), is credited with (i) all of the Participant’s ESOP
Employer Contributions on the Effective Date, and (ii) all additional
ESOP Employer Contributions contributed and/or accrued after the Effective Date. The
ESOP Subaccount shall be adjusted to the extent provided in Section 6.8(c). The ESOP
Subaccount shall also be adjusted to reflect such subaccount’s change in value as provided
in Section 4.3. The ESOP Subaccount shall be invested in Company Stock in accordance with
Article VI; and

 

6

 

(2) Non-ESOP Subaccount: The portion of a Participant’s Employer Contribution
Account that is credited with the sum of (i) all of the Participant’s non-ESOP Employer
Contributions on the Effective Date, (ii) all additional non-ESOP Employer Contributions
contributed and/or accrued after the Effective Date, and (iii) all Employer Discretionary
Qualified Matching Contributions, if any, made on such Participant’s behalf pursuant to
Section 3.5 to satisfy restrictions set forth in Section 3.6. The Non-ESOP Subaccount shall
be adjusted to the extent provided in Section 6.8(b) and (c). The Non-ESOP Subaccount shall
also be adjusted to reflect such subaccount’s change in value as provided in Section 4.3.

(cc) Employer Contributions: The total of Employer Matching Contributions, Employer
Discretionary Contributions and Employer Discretionary Qualified Matching Contributions.

(dd) Employer Discretionary Contributions: Contributions made to the Plan by the
Employer pursuant to Section 3.4.

(ee) Employer Discretionary Qualified Matching Contributions: Contributions made to
the Plan by the Employer pursuant to Section 3.5.

(ff) Employer Matching Contributions: Contributions made to the Plan by the Employer
pursuant to Section 3.3.

(gg) ESOP: The employee stock ownership plan maintained as a part of the Plan
pursuant to Article VI.

(hh) ESOP Subaccount: The subaccount of a Participant’s Employer Contribution Account
defined in Section 1.1(bb). In addition to other provisions of the Plan, a Participant’s ESOP
Subaccount shall be subject to Article VI and, in the event of any conflict, Article VI shall
control.

(ii) Exempt Loan: A loan that satisfies the provisions of Treasury Regulations Section
54.4975-7(b) made to the Trustee pursuant to the provisions of Article VI.

(jj) Financed Stock: The Company Stock acquired with the proceeds of an Exempt Loan.

(kk) 415 Compensation: Compensation as defined under Section 415(c)(3) of the Code
and Treasury Regulations issued pursuant thereto.

 

7

 

(ll) Highly Compensated Employee: Each Employee who performs services during the Plan
Year for which the determination of who is highly compensated is being made (the “Determination
Year”) and who:

(1) Is a five-percent owner of the Employer (within the meaning of Section
416(i)(1)(A)(iii) of the Code) at any time during the Determination Year or the twelve-month
period immediately preceding the Determination Year (the “Look-Back Year”); or

(2) For the Look-Back Year:

(A) Receives compensation (within the meaning of Section 414(q)(4) of
the Code; “compensation” for purposes of this Paragraph) in excess of
$90,000 (with such amount to be adjusted automatically to reflect any
cost-of-living adjustments authorized by Section 414(q)(1) of the Code)
during the Look-Back Year; and

(B) If the Committee elects the application of this clause in such
Look-Back Year, is a member of the top 20% of Employees for the Look-Back
Year (other than Employees described in Section 414(q)(5) of the Code)
ranked on the basis of compensation received during the year.

For purposes of the preceding sentence, (i) all employers aggregated with the Employer under
Sections 414(b), (c), (m), or (o) of the Code shall be treated as a single employer and (ii)
a former Employee who had a separation year (generally, the Determination Year such Employee
separates from service) prior to the Determination Year and who was an active Highly
Compensated Employee for either such separation year or any Determination Year ending on or
after such Employee’s fifty-fifth birthday shall be deemed to be a Highly Compensated
Employee. To the extent that the provisions of this Paragraph are inconsistent or conflict
with the definition of a “highly compensated employee” set forth in Section 414(q) of the
Code and the Treasury Regulations thereunder, the relevant terms and provisions of Section
414(q) of the Code and the Treasury Regulations thereunder shall govern and control.

(mm) Incentive Contribution Subaccount: The subaccount of a Participant’s Employer
Contribution Account that is comprised of the balance referred to in Clause (1) of Section 1.1(bb).

(nn) Investment Fund: Investment funds made available from time to time for the
investment of Plan assets as described in Article V.

(oo) Independent Fiduciary: The person or entity acting with respect to the Company
Stock Fund, as provided in Section 14.5.

 

8

 

(pp) Leased Employee: Each person who is not an employee of the Employer or a
Controlled Entity but who performs services for the Employer or a Controlled Entity pursuant to an
agreement (oral or written) between the Employer or a Controlled Entity and any
leasing organization, provided that (i) such person has performed such services for the
Employer or a Controlled Entity or for related persons (within the meaning of Section 144(a)(3) of
the Code) on a substantially full-time basis for a period of at least one year, and (ii) such
services are performed under primary direction or control by the Employer or a Controlled Entity.

(qq) Non-ESOP Subaccount: The subaccount of a Participant’s Employer Contribution
Account defined in
Section 1.1(bb).

(rr) Normal Retirement Date: The date a Participant attains the age of sixty-five.

(ss) Participant: Each individual who (i) has met the eligibility requirements for
participation in the Plan pursuant to Article II, or (ii) has made a Rollover Contribution in
accordance with Section 3.9, but only to the extent provided in Section 3.9. For purposes of
Articles V and VI and Section 18.6 only, the beneficiary of a deceased Participant and any
alternate payee under a qualified domestic relations order (as defined in Section 18.2) shall have
the rights of a Participant.

(tt) Plan: The Dynegy Midwest Generation, Inc. 401(k) Savings Plan for Employees
Covered Under a Collective Bargaining Agreement, as amended from time to time.

(uu) Plan Year: The twelve-consecutive month period commencing January 1 of each year.

(vv) Rollover Contribution Account: An individual account for a Participant, which is
comprised of the following subaccounts:

(1) Employee After-Tax Rollover Subaccount: A subaccount for such
Participant that is credited with (i) the balance of his Rollover Contributions
consisting of after-tax employee contributions on the Effective Date, if any, and
(ii) any additional Rollover Contributions consisting of after-tax employee
contributions. A Participant’s Employee After-Tax Rollover Subaccount shall be
adjusted to reflect changes in value as provided in Section 4.3.

(2) Employee Rollover Subaccount: A subaccount for such Participant
that is credited with (i) the balance of his Employee Rollover Subaccount on the
Effective Date, and (ii) any additional Rollover Contributions consisting of amounts
other than after-tax employee contributions and Roth Contributions. A Participant’s
Employee Rollover Subaccount shall be adjusted to reflect changes in value as
provided in Section 4.3.

(3) Employee Roth Rollover Subaccount: A subaccount for such
Participant that is credited with (i) the balance of his Employee Roth Rollover
Subaccount on the Effective Date, and (ii) any additional Rollover Contributions
consisting of Roth Contributions. A Participant’s Employee Roth Rollover Subaccount
shall be adjusted to reflect changes in value as provided in Section 4.3.

 

9

 

(ww) Rollover Contributions: Contributions made by a Participant pursuant to Section
3.9.

(xx) Roth Account: An individual account for each Participant that is credited with
Roth Contributions, if any, made in accordance with Section 3.1(i) of the Plan. Such Account shall
also be adjusted to reflect changes in value as provided in Section 4.3.

(yy) Roth Contributions: Contributions made by a Participant pursuant to
Section 3.1(i).

(zz) Salaried Plan: The Dynegy Midwest Generation, Inc. 401(k) Savings Plan, as
amended from time to time.

(aaa) Severance from Employment: The term “Severance from Employment” shall have the
same meaning as set forth in Treasury Regulation Section 1.401(k)-1(d). A Severance from
Employment occurs when the Participant ceases to be an Employee of an Employer maintaining the
Plan. An Employee does not have a Severance from Employment if, in connection with a change of
employment, the Employee’s new employer maintains such Plan with respect to the Employee. For
example, if a new employer maintains the Plan with respect to an Employee by continuing or assuming
sponsorship of the Plan or by accepting a transfer of Plan assets and liabilities (within the
meaning of Section 414(l) of the Code) with respect to the Employee, such Employee does not have a
Severance from Employment.

(bbb) Suspense Account: The account under which Financed Stock is held until released
and allocated to Participants’ ESOP Subaccounts.

(ccc) Total and Permanent Disability: A Participant shall be considered totally and
permanently disabled if (i) the Participant has been determined to be disabled by the Social
Security Administration, and (ii) the Participant is receiving payment of social security
disability benefits.

(ddd) TRASOP: The Illinois Power Company Tax Reduction Act Stock Ownership Plan, which
was terminated effective October 31, 1988.

(eee) TRASOP Transfer Account: An individual account for each Participant who was a
participant in the TRASOP and who had his account balances under the TRASOP transferred to the
Plan, which is comprised of the following subaccounts:

(1) TRASOP Employee Subaccount: A subaccount for each such Participant that is
attributable to employee contributions to the TRASOP. The TRASOP Employee Subaccount shall
be adjusted to reflect such subaccount’s change in value as provided in Section 4.3.

(2) TRASOP Employer Subaccount: A subaccount for each such Participant that is
attributable to employer contributions to the TRASOP. The TRASOP Employer Subaccount shall
be adjusted to reflect such subaccount’s change in value as provided in Section 4.3.

 

10

 

(fff) Trust: The trust(s) established under the Trust Agreement(s) to hold and invest
contributions made under the Plan and income thereon, and from which Plan benefits are distributed.

(ggg) Trust Agreement: The agreement(s) entered into between the Company and the
Trustee establishing the Trust, as such agreement(s) may be amended from time to time.

(hhh) Trust Fund: The funds and properties held pursuant to the provisions of the
Trust Agreement for the use and benefit of the Participants, together with all income, profits, and
increments thereto.

(iii) Trustee: The trustee or trustees qualified and acting under the Trust Agreement
at any time.

(jjj) VBO: The “Vanguard Brokerage Option” that is an Investment Fund under the Plan,
as described in Section 5.4 of the Plan.

1.2 Number and Gender. Wherever appropriate herein, words used in the singular shall
be considered to include the plural, and words used in the plural shall be considered to include
the singular. The masculine gender, where appearing in the Plan, shall be deemed to include the
feminine gender.

1.3 Headings. The headings of Articles and Sections herein are included solely for
convenience, and if there is any conflict between such headings and the text of the Plan, the text
shall control.

1.4 Construction. It is intended that the Plan be qualified within the meaning of
Section 401(a) of the Code and that the Trust be tax exempt under Section 501(a) of the Code, and
all provisions herein shall be construed in accordance with such intent.

II.

PARTICIPATION

2.1
Eligibility. On or after the Effective Date, each Eligible Employee shall become
a Participant immediately upon his employment as an Eligible Employee. Notwithstanding the
foregoing:

(a) An Eligible Employee who was a Participant in the Plan on the day prior to the Effective
Date shall remain a Participant in this restatement thereof as of the Effective Date;

(b) An Employee who has not become a Participant because he was not an Eligible Employee shall
become a Participant immediately upon becoming an Eligible Employee as a result of a change in his
employment status; and

(c) A Participant who ceases to be an Eligible Employee but remains an Employee shall continue
to be a Participant but, on and after the date he ceases to be an Eligible Employee, he shall no
longer be entitled to defer Compensation hereunder, make contributions to
the Plan, or share in allocations of Employer Contributions unless and until he shall again
become an Eligible Employee.

 

11

 

2.2 Transferred Employees. Notwithstanding any foregoing provision of this Section to
the contrary, if an employee of the Employer or a Controlled Entity (i) is a participant in the
Salaried Plan, (ii) ceases to satisfy the eligibility requirements of the Salaried Plan because he
transfers into an employment classification as a member of a group of employees to which the Plan
has been extended and continues to be extended through a currently effective collective bargaining
agreement between his employer and the collective bargaining representative of the group of
employees of which he is a member, (iii) continues to be employed by the Employer or a Controlled
Entity, and (iv) coincident with his cessation of eligibility for the Salaried Plan, satisfies the
eligibility requirements of Section 2.1, then the sum of the amounts in his accounts under the
Salaried Plan (including any outstanding loans) as of the date of the transfer hereinafter
described shall be transferred as soon as practicable after such cessation to corresponding
Accounts under the Plan in accordance with the requirements of Section 414(1) of the Code and the
regulations thereunder, and, for periods after the date of such cessation, he shall cease to be a
participant in the Salaried Plan and shall be a Participant in the Plan, subject to the terms and
conditions of the Plan. Amounts transferred to the Plan pursuant to this Section shall not be
considered annual additions for purposes of Section 415 of the Code and Section 4.4 of the Plan.

III.

CONTRIBUTIONS

3.1 Before-Tax Contributions.

(a) A Participant may elect to defer an integral percentage of not less than 1% of his
Compensation for a Plan Year by having the Employer contribute the amount so deferred to the Plan.
A Participant’s election to defer an amount of his Compensation pursuant to this Section shall be
made by authorizing his Employer, in the manner prescribed by the Committee, to reduce his
Compensation in the elected amount and the Employer, in consideration thereof agrees to contribute
an equal amount to the Plan. The Compensation elected to be deferred by a Participant pursuant to
this Section shall become a part of the Employer’s Before-Tax Contributions and shall be allocated
in accordance with Section 4.1(a). Compensation for a Plan Year not so deferred by a Participant
shall be received by such Participant in cash. Such elections cannot relate to Compensation that is
currently available prior to the adoption or effective date of the Plan. In addition, except for
occasional, bona fide administrative considerations, contributions made pursuant to such an
election cannot precede the earlier of (i) the date of the performance of services relating to the
contribution, and (ii) the date the Compensation that is subject to the election would be currently
available to the Participant in the absence of an election to defer. Such elections can only be
made with respect to amounts that are compensation as defined under Section 415(c)(3) of the Code
and Treasury Regulation Section 1.415(c)-2. A Participant who is not in Qualified Military Service
(as defined in Section 414(u) of the Code) cannot make an election with respect to an amount paid
after the Participant’s Severance from Employment, unless the amount is paid within 21/2 months
following the Participant’s Severance from Employment and is described in Treasury Regulation
Section 1.415(c)-2(e)(3)(ii). For clarification purposes, the preceding sentence shall permit
elections to apply to: (i) amounts earned prior to a Severance from Employment, and (ii) payments
of sick
leave and/or vacation pay paid to a Participant as soon as administratively feasible following
Severance from Employment.

 

12

 

(b) A Participant’s deferral election shall remain in force and effect for all periods
following the effective date of such election (which shall be as soon as administratively feasible
after the election is made) until modified or terminated or until such Participant terminates his
employment or ceases to be an Eligible Employee. A Participant who has elected to defer a portion
of his Compensation may change his deferral election percentage, effective as of the next available
pay date, by communicating such new deferral election percentage to his Employer in the manner and
within the time period prescribed by the Committee.

(c) A Participant may cancel his deferral election, effective as of the next available pay
date by communicating such cancellation to his Employer in the manner and within the time period
prescribed by the Committee. A Participant who so cancels his deferral election may resume
deferrals, effective as of the next available pay date, by communicating his new deferral election
to his Employer in the manner and within the time period prescribed by the Committee.

(d) In restriction of the Participants’ elections provided in Paragraphs (a), (b), and (c)
above, the Before-Tax Contributions and the elective deferrals (within the meaning of
Section 402(g)(3) of the Code) under all other plans, contracts, and arrangements of the Employer
on behalf of any Participant for any calendar year shall not exceed $16,500 for calendar year 2009,
(with such amount to be adjusted automatically to reflect any cost-of-living adjustments authorized
by Section 402(g)(4) of the Code).

(e) In further restriction of the Participants’ elections provided in Paragraphs (a), (b), and
(c) above, it is specifically provided that one of the actual deferral percentage tests set forth
in Section 401(k)(2) of the Code and Treasury Regulations thereunder (“ADP Test”) must be met in
each Plan Year. Such testing shall utilize the current year testing method as such term is defined
under Treasury Regulation Section 1.401(k)-2(a)(2)(ii). The actual deferral ratio (as such term is
defined under Treasury Regulation Section 1.401(k)-6 (“ADR”) of any Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to have Before-Tax Contributions (and
Employer Discretionary Qualified Matching Contributions, if treated as elective contributions for
purposes of the ADP Test) allocated to such Participant’s accounts under two (2) or more cash or
deferred arrangements described in Section 401(k) of the Code, that are maintained by an Employer
(or a Controlled Entity), shall be determined as if such elective contributions (and, if
applicable, such Qualified Matching Contributions) were made under a single arrangement. If a
Highly Compensated Employee participates in two (2) or more cash or deferred arrangements of an
Employer (or a Controlled Entity) that have different Plan Years, then all elective contributions
made during the Plan Year being tested under all such cash or deferred arrangements shall be
aggregated, without regard to the plan years of the other plans. Notwithstanding the foregoing,
certain plans shall be treated as separate if mandatorily disaggregated under the Regulations of
Section 401(k) of the Code.

(f) If the Committee determines that a reduction of Compensation deferral elections made
pursuant to Paragraphs (a), (b), and (c) above is necessary to insure that the restrictions set
forth in Paragraph (d) or (e) above are met for any Plan Year, the Committee may
reduce the elections of affected Participants on a temporary and prospective basis in such
manner as the Committee shall determine.

 

13

 

(g) As soon as administratively feasible following the end of each payroll period, but no
later than the time required by applicable law, the Employer shall contribute to the Trust, as
Before-Tax Contributions with respect to each Participant, an amount equal to the amount of
Compensation elected to be deferred, pursuant to Paragraphs (a) and (b) above (as adjusted pursuant
to Paragraph (f) above), by such Participant during such payroll period. Such contributions, as
well as the contributions made pursuant to Sections 3.3, 3.4, and 3.5 shall be made without regard
to current or accumulated profits of the Employer. Notwithstanding the foregoing, except as
provided in Article VI, the Plan is intended to qualify as a profit sharing plan for purposes of
Sections 401(a), 402, 412, and 417 of the Code.

(h) Notwithstanding the foregoing, all Participants who are eligible to make elective
deferrals under this Plan and who have attained age 50 before the close of the Plan 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
implementing the required limitations of Section 402(g) and 415 of the Code. Catch-Up
Contributions shall not be matched by Employer Contributions in accordance with Section 402(g) and
415 of the Code. Catch-Up Contributions shall not be matched by Employer Contributions in
accordance with Section 3.3 of the Plan. Any Catch-Up Contribution made as a Roth Contribution
under Section 3.1(i) shall be treated as a Roth Contribution for purposes of allocation,
distribution and investment. 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. Notwithstanding
any other provision of the Plan, Catch-up Contributions shall not be matched by Employer
Contributions. Any Catch-Up Contribution made as a Roth Contribution under Section 3.1(i) shall be
treated as a Roth Contribution for purposes of allocation, distribution and investment.

(i) Effective January 1, 2008, a Participant may elect to have some or all of his or her
Before-Tax Contribution, as a whole percentage of Compensation, and some or all of any Catch-Up
Contribution, contributed to the Plan as a Roth Contribution. A Roth Contribution means any
Before-Tax Contribution that is (i) designated irrevocably by the Participant at the time of
execution of the applicable payroll deduction authorization form supplied by the Employer as a Roth
Contribution; (ii) treated by the Employer as included in the Participant’s income at the time the
Participant would have received the amount in cash if the Participant had not made the election
with respect to such Roth Contribution so that the Roth Contribution shall be included as wages
subject to applicable withholding requirements; and (iii) maintained by the Plan in a separate,
designated Roth Account. Roth Contributions shall be subject to the same dollar limits and
nondiscrimination testing requirements as Before-Tax Contributions, and shall be subject to the
same Plan provisions as Before-Tax Contributions for purposes of investment and distribution.

 

14

 

(j) Notwithstanding the foregoing or anything to the contrary, each Eligible Employee whose
employment with the Employer begins on or after the Effective Date shall be deemed to have elected
to defer 6% of his Compensation as a Before-Tax Contribution (and for
the sake of clarity, not as a Roth Contribution) effective as of the first administratively
feasible pay period following an opt-out period prescribed by the Committee (which shall not be
less than sixty (60) days) unless such Eligible Employee opts out of such deemed election during
such opt-out period in the manner prescribed by the Committee. Except as provided in this
Paragraph (j), all provisions applicable to the elective deferrals made pursuant to Paragraph (a)
above shall also be applicable to deemed elective deferrals made pursuant to this Paragraph,
including, but not limited to, a Participant’s ability to cancel or change such election in
accordance with Paragraphs (b) and (c) above.

3.2 After-Tax Contributions.

(a) If the Before-Tax Contributions to be made with respect to a Participant are restricted by
the limitations set forth in Section 3.1(d) for a calendar year, then, automatically and without
any further action by such Participant, such Participant’s Compensation shall continue to be
reduced by the percentage elected by the Participant and then in effect pursuant to Section 3.1(a),
(b), or (c) for the remainder of such year but on an after-tax basis with such reductions to be
contributed to the Plan as his After-Tax Contributions. Effective as of the first day of the
following Plan Year, automatically and without any further action by the Participant, such
Participant’s Compensation reduction election as then in effect under this Paragraph (a), as
adjusted pursuant to Paragraphs (e), (d), and (f) below, shall revert to an election to defer
Compensation pursuant to Section 3.1(a).

(b) Without limiting the applicability of Paragraph (a) above, a Participant may contribute to
the Plan, as his After-Tax Contributions, an integral percentage of not less than 1% of his
Compensation. After-Tax Contributions shall be made by authorizing the Employer to withhold such
contributions from the Participant’s Compensation as of each payroll period. Each Participant may
elect the amount of his After-Tax Contributions in the manner and within the time period prescribed
by the Committee.

(c) A Participant may change the amount of his After-Tax Contributions pursuant to Paragraph
(a) and/or (b) above effective as of the next available pay data by electing a new After-Tax
Contribution percentage in the manner and within the time period prescribed by the Committee.

(d) A Participant may suspend his After-Tax Contributions pursuant to Paragraph (a) and/or (b)
above effective as of the next available pay date in accordance with the procedures and within the
time period prescribed by the Committee. Resumption of suspended After-Tax Contributions shall be
made effective as of the next available pay date by making a new election in the manner and within
the time period prescribed by the Committee; provided, however, that a Participant may not resume
his After-Tax Contributions pursuant to Paragraph (a) above once such After-Tax Contributions have
been suspended pursuant to this Paragraph.

(e) A Participant may at any time elect to make a lump sum After-Tax Contribution to the Plan.
Such After-Tax Contribution shall be paid to the Employer by such Participant in cash (including
personal check or other method approved by the Committee), in an amount determined by such
Participant; provided, however, that such contribution may not exceed the otherwise applicable
limits set forth in the Plan.

 

15

 

(f) If the restrictions set forth in Section 3.6 would not otherwise be met for any Plan Year,
(i) the After-Tax Contribution elections made pursuant to Paragraphs (a), (b), (c), and (d) above
of affected Participants may be reduced by the Committee on a temporary and prospective basis in
such manner as the Committee shall determine, and (ii) any After-Tax Contributions pursuant to
Paragraph (e) above of affected Participants may be limited or disallowed.

(g) As soon as administratively feasible following (i) the end of each payroll period, or (ii)
the receipt by the Employer of a Participant’s payment pursuant to Paragraph (e) above, but in
either event no later than the time required by applicable law, the Employer shall contribute to
the Trust the After-Tax Contributions withheld from the Participant’s Compensation during such
payroll period or paid to the Employer in accordance with Paragraph (e) above, as applicable.

3.3 Employer Matching Contributions.

(a) For each payroll period, the Employer shall contribute to the Trust, as Employer Matching
Contributions, an amount that equals 50% of the Before-Tax Contributions that were made pursuant to
Section 3.1 on behalf of each of the Participants during such payroll period and that were not in
excess of 6% of each such Participant’s Compensation for such payroll period.

(b) In addition to the Employer Matching Contributions made pursuant to Paragraph (a) above,
for each Plan Year the Employer shall contribute to the Trust, as Employer Matching Contributions,
an amount equal to the difference, if any, between (i) 50% of the Before-Tax Contributions that
were made pursuant to Section 3.1 on behalf of each of the Eligible Participants during such Plan
Year and that were not in excess of 6% of each such Eligible Participant’s Compensation for such
Plan Year, and (ii) the Employer Matching Contributions made pursuant to Paragraph (a) above for
each such Eligible Participant for such Plan Year. For purposes of this Paragraph, the term
“Eligible Participant” shall mean each Participant who was an Eligible Employee on the last day of
the applicable Plan Year.

(c) Employer Matching Contributions pursuant to Paragraph (a) above shall be contributed to
the Trust at the same time the related Before-Tax Contributions are contributed to the Trust, and
Employer Matching Contributions pursuant to Paragraph (b) above shall be contributed to the Trust
at the time determined by the Committee. At the sole discretion of the Directors or the
Compensation Committee of the Company’s Board of Directors, Employer Matching Contributions on
behalf of Participants shall be made in cash, in whole shares of Company Stock, or in any
combination of cash and whole shares of Company Stock.

(d) Notwithstanding any foregoing provision of this Section to the contrary, if at any time an
Exempt Loan is outstanding, then, to the extent permissible, Employer Matching Contributions shall
be contributed to the ESOP in accordance with Section 6.6 and subsequently allocated pursuant to
Section 4.1(c).

(e) Notwithstanding the preceding provisions of this Section 3.3, Roth Contributions (except
Catch-Up Contributions made as Roth Contributions) shall be eligible for Employer Matching
Contributions in the same manner and amount as Before-Tax Contributions.

 

16

 

3.4 Employer Discretionary Contributions.

(a) For each Plan Year, the Employer may contribute to the Trust, as an Employer Discretionary
Contribution, an additional amount as determined in its discretion.

(b) If it has been so determined that an Employer Discretionary Contribution shall be made for
any Plan Year, then such contribution shall be made in cash, in whole shares of Company Stock, or
in any combination of cash and whole shares of Company Stock (as determined in the sole discretion
of the Directors or the Compensation Committee of the Company’s Board of Directors).

(c) Notwithstanding any foregoing provision of this Section to the contrary, if at any time an
Exempt Loan is outstanding, then, to the extent permissible, Employer Discretionary Contributions
shall be contributed to the ESOP in accordance with Section 6.6 and subsequently allocated pursuant
to Section 4.1(d).

3.5 Employer Discretionary Qualified Matching Contributions. In addition to the
Employer Matching Contributions made pursuant to Section 3.3 and the Employer Discretionary
Contributions made pursuant to Section 3.4, for each Plan Year, the Employer, in its discretion,
may contribute to the Trust as an Employer Discretionary Qualified Matching Contribution for such
Plan Year the amounts necessary to cause the Plan to satisfy the restrictions set forth in
Section 3.1(e) (with respect to certain restrictions on Before-Tax Contributions) and the amounts
necessary to cause the Plan to satisfy the restrictions set forth in Section 3.6 (with respect to
certain restrictions on Employer Matching Contributions and After-Tax Contributions). Amounts
contributed in order to satisfy the restrictions set forth in Section 3.1(e) shall be considered
“Qualified Matching Contributions” (within the meaning of Treasury Regulation Section 1.401(k)-6),
and amounts contributed in order to satisfy the restrictions set forth in Section 3.6 shall be
considered Employer Matching Contributions.

Employer Discretionary Qualified Matching Contributions may be contributed to the Plan
pursuant to the foregoing for purposes of satisfying the restrictions set forth in Section 3.1(e)
only if the conditions described in Treasury Regulation Section 1.401(k)-2(a)(6) are satisfied. A
contribution made pursuant to this Section 3.5 is not taken into account under the actual
contribution percentage test (as defined under Treasury Regulation Section 1.401(k)-6 (“ACP Test”)
or in determining the ADR for a Participant who is not a Highly Compensated Employee (a “NHCE”) to
the extent that it exceeds the greatest of:

(a) Five percent (5%) of the NHCE’s Section 414(s) of the Code compensation for the Plan Year;

(b) The NHCE’s Before-Tax Contributions for the Plan Year; and

(c) The product of two (2) times the Plan’s “Representative Matching Rate” (as defined below)
and the NHCE’s Before-Tax Contributions for the Plan Year.

 

17

 

Any amounts contributed pursuant to this Paragraph shall be allocated in accordance with the
provisions of Sections 4.1(e), (f) and (g). For purposes of this Paragraph, the “Matching Rate”
for a Participant generally is the Employer Matching Contributions made for such Participant
divided by the Participant’s Before-Tax Contributions for the Plan Year. For purposes of this
Paragraph, the “Representative Matching Rate” is the lowest Matching Rate for any eligible NHCE
among a group of NHCEs that consists of half of all eligible NHCEs in the Plan for the Plan Year
(or, if greater, the lowest Matching Rate for all eligible NHCEs in the Plan who are employed by
the Employer on the last day of the Plan Year and who make Before-Tax Contributions for the Plan
Year). If the Matching Rate is not the same for all levels of Before-Tax Contributions for a
Participant, then the Participant’s Representative Matching Rate is determined assuming that a
Participant’s Before-Tax Contributions are equal to 6% of his compensation under Section 414(s) of
the Code.

3.6 Restrictions on Employer Matching Contributions and After-Tax Contributions. In
restriction of the Employer Matching Contributions and After-Tax Contributions hereunder, it is
specifically provided that one of the actual contribution percentage tests set forth in Section
401(m) of the Code and Treasury Regulations thereunder (“ACP Test”) must be met in each Plan Year.
Such testing shall utilize the current year testing method as such term is defined in Treasury
Regulation Section 1.401(m)-2(a)(2)(ii). The Committee may elect, in accordance with applicable
Treasury Regulations, to treat Before-Tax Contributions to the Plan as Employer Matching
Contributions for purposes of meeting this requirement. The actual contribution ratio (as such
term is defined under Treasury Regulations Section 1.401(k)-6) (the “ACR”) for any Participant who
is a Highly Compensated Employee and who is eligible to have Employer Matching Contributions or
After-Tax Contributions allocated to his or her account under two (2) or more plans described in
Section 401(a) of the Code, or arrangements described in Section 401(k) of the Code that are
maintained by the same Employer (or Controlled Entity), shall be determined as if the total of such
contributions was made under each plan and arrangement. If a Highly Compensated Employee
participates in two (2) or more such plans or arrangements that have different plan years, then all
Employer Matching Contributions and After-Tax Contributions made during the Plan Year being tested
under all such plans and arrangements shall be aggregated, without regard to the plan years of the
other plans. Notwithstanding the foregoing, certain plans shall be treated as separate if
mandatorily disaggregated under the regulations of Section 401(m) of the Code. If Employer
Matching Contributions for any portion of a Plan Year are allocated in whole or in part to the ESOP
Subaccounts of Participants pursuant to Section 3.3(d), then (i) a separate test under this Section
for such Plan Year shall be performed with respect to such Employer Matching Contributions and (ii)
a separate test under this Section for such Plan Year shall be performed with respect to After-Tax
Contributions and all other Employer Matching Contributions, if any.

3.7 Return of Contributions. Anything to the contrary herein notwithstanding, the
Employer’s contributions to the Plan are contingent upon the deductibility of such contributions
under Section 404 of the Code. To the extent that a deduction for contributions is disallowed,
such contributions shall, upon the written demand of the Employer, be returned to the Employer by
the Trustee within one year after the date of disallowance, reduced by any net losses of the
Trust Fund attributable thereto but not increased by any net earnings of the Trust Fund
attributable thereto, which net earnings shall be treated as a forfeiture in accordance with
Section 4.2. Moreover, if Employer contributions are made under a mistake of fact, such
contributions shall, upon the written demand of the Employer, be returned to the Employer by the
Trustee within one year after the payment thereof, reduced by any net losses of the Trust Fund
attributable thereto but not increased by any net earnings of the Trust Fund attributable thereto,
which net earnings shall be treated as a forfeiture in accordance with Section 4.2.

 

18

 

3.8 Disposition of Excess Deferrals and Excess Contributions.

(a) Anything to the contrary herein notwithstanding, any Before-Tax Contributions and/or Roth
Contributions to the Plan for a calendar year on behalf of a Participant in excess of the
limitations set forth in Section 3.1(d) and any “excess deferrals” from other plans allocated to
the Plan by such Participant no later than March 1 of the next following calendar year within the
meaning of, and pursuant to the provisions of, Section 402(g)(2) of the Code, shall be distributed
to such Participant not later than April 15 of the next following calendar year.

(b) Anything to the contrary herein notwithstanding, if, for any Plan Year, the aggregate
Before-Tax Contributions and/or Roth Contributions made by the Employer on behalf of Highly
Compensated Employees exceeds the maximum amount of Before-Tax Contributions and/or Roth
Contributions permitted on behalf of such Highly Compensated Employees pursuant to Section 3.1(e)
or 3.1(i) respectively, an excess amount shall be determined by reducing Before-Tax Contributions
and/or Roth Contributions on behalf of Highly Compensated Employees in order of the highest ADRs to
equal the highest permitted ADR in accordance with Section 401(k)(8)(B)(ii) of the Code and the
Treasury Regulations thereunder. Once determined, the Committee may adjust the contributions of
each affected Highly Compensated Employee by causing such excess amounts to be (i) recharacterized
as Catch-Up Contributions pursuant to the provisions of Section 4.5 of the Plan to the maximum
extent possible, and (ii) distributed to Highly Compensated Employees in order of the highest
dollar amounts contributed on behalf of such Highly Compensated Employees in accordance with
Section 401(k)(8)(C) of the Code and the Treasury Regulations thereunder before the end of the next
following Plan Year. Income allocable to such excess amounts with respect to a Plan Year shall be
distributed therewith and shall include income for such Plan Year including the gap period between
the end of such Plan Year and the date of distribution of such excess amounts computed under the
safe harbor method of allocating gap period income set forth in Treasury Regulation Section
1.401(k)-2(b)(2)(iv)(D).

(c) Anything to the contrary herein notwithstanding, if, for any Plan Year, the aggregate
Employer Matching Contributions and After-Tax Contributions allocated to the Accounts of Highly
Compensated Employees exceeds the maximum amount of such Employer Matching Contributions and
After-Tax Contributions permitted on behalf of such Highly Compensated Employees pursuant to
Section 3.6, an excess amount shall be determined by reducing, first, After-Tax Contributions made
by, and second, Employer Matching Contributions made on behalf of, Highly Compensated Employees in
order of the highest ACR to equal the highest permitted ACR in accordance with Section
401(m)(6)(B)(ii) of the Code and Treasury Regulations thereunder. Once determined, such excess
shall be distributed to Highly Compensated Employees in order of the highest dollar amounts
contributed by or on behalf of such Highly Compensated Employees in accordance with Section
401(m)(6)(C) of the Code and
the Treasury Regulations thereunder (or, if such excess contributions are forfeitable, they
shall be forfeited) before the end of the next following Plan Year. Income allocable to such
excess amounts with respect to a Plan Year shall be distributed therewith and shall include income
for such Plan Year including the gap period between the end of such Plan Year and the date of
distribution of such excess amounts computed under the safe harbor method of allocating gap period
income set forth in Treasury Regulation Section 1.401(m)-2(b)(2)(iv)(D). If separate testing is
performed pursuant to the last sentence of Section 3.6, then the corrective actions described in
this Paragraph shall be applied separately in a manner consistent with such separate testing.

 

19

 

(d) Effective January 1, 2008, in coordinating the disposition of excess deferrals and excess
contributions pursuant to this Section, such excess deferrals and excess contributions shall be
disposed of in the following order:

(1) First, excess Roth Contributions that constitute excess deferrals described in
Paragraph (a) above that are not considered in determining the amount of Employer Matching
Contributions pursuant to Section 3.3 shall be distributed;

(2) Next, excess Roth Contributions that constitute excess deferrals described in
Paragraph (a) above that are considered in determining the amount of Employer Matching
Contributions pursuant to Section 3.3 shall be distributed, and the Employer Matching
Contributions with respect to such Before-Tax Contributions shall be forfeited;

(3) Next, excess Before-Tax Contributions that constitute excess deferrals described in
Paragraph (a) above that are not considered in determining the amount of Employer Matching
Contributions pursuant to Section 3.3 shall be distributed;

(4) Next, excess Before-Tax Contributions that constitute excess deferrals described in
Paragraph (a) above that are considered in determining the amount of Employer Matching
Contributions pursuant to Section 3.3 shall be distributed, and the Employer Matching
Contributions with respect to such Before-Tax Contributions shall be forfeited;

(5) Next, excess Before-Tax Contributions described in Paragraph (b) above that are not
considered in determining the amount of Employer Matching Contributions pursuant to Section
3.3 shall be distributed;

(6) Next, excess Before-Tax Contributions described in Paragraph (b) above that are
considered in determining the amount of Employer Matching Contributions pursuant to Section
3.3 shall be distributed, and the Employer Matching Contributions with respect to such
Before-Tax Contributions shall be forfeited;

(7) Next, excess After-Tax Contributions described in Paragraph (c) above shall be
distributed; and

 

20

 

(8) Finally, excess Employer Matching Contributions described in Paragraph (c) above
shall be distributed (or, if forfeitable, forfeited).

(e) Any distribution or forfeiture of excess deferrals or excess contributions pursuant to the
provisions of this Section shall be adjusted for income or loss allocated thereto in the manner
determined by the Committee in accordance with any method permissible under applicable Treasury
Regulations.

3.9 Rollover Contributions.

(a) Rollover Contributions may be made to the Plan by any Participant of amounts received by
such Participant from a qualified plan described in Section 401(a) or 403(a) of the Code or an
annuity contract described in Section 403(b) of the Code (excluding, in each case, after-tax
employee contributions). In addition, the Plan will accept a Rollover Contribution of the portion
of a distribution received by a Participant from an individual retirement account or annuity
described in Section 408(a) or 408(b) of the Code that is eligible to be rolled over and would
otherwise be includible in gross income. Rollover Contributions pursuant to this Paragraph may
only be made to the Plan pursuant to and in accordance with applicable provisions of the Code and
Treasury Regulations promulgated thereunder.

Notwithstanding the foregoing, effective January 1, 2008, the Plan will accept a Rollover
Contribution of after-tax employee contributions and/or Roth contributions as Rollover
Contributions. The Plan will account separately for amounts so transferred, including accounts
separately for the portion of such distribution which is includible in gross income and the portion
of such distribution which is not includible in gross income.

(b) Rollover Contributions may be made to the Plan by any Participant of amounts received by
such Participant from any of a qualified plan described in Section 401(a) or 403(a) of the Code
(including after-tax employee contributions) or an annuity described in Section 403(b) of the Code
(excluding after-tax employee contributions). Rollover Contributions may be made to the Plan only
pursuant to and in accordance with applicable provisions of the Code and Treasury Regulations
promulgated thereunder. A Rollover Contribution of amounts that are “eligible rollover
distributions” within the meaning of Section 402(f)(2)(A) of the Code may be made to the Plan
irrespective of whether such eligible rollover distribution was paid to the Participant or paid to
the Plan as a “direct” Rollover Contribution.

(c) Any Participant desiring to effect a Rollover Contribution to the Plan must follow the
procedures prescribed by the Committee for such purpose. The Committee may require as a condition
to accepting any Rollover Contribution that such Participant furnish any evidence that the
Committee in its discretion deems satisfactory to establish that the proposed Rollover Contribution
is in fact eligible for rollover to the Plan and is made pursuant to and in accordance with
applicable provisions of the Code and Treasury Regulations. All Rollover Contributions to the Plan
must be made in cash. A Rollover Contribution shall be credited to the Rollover Contribution
Account of the Participant for whose benefit such Rollover Contribution is being made as of the day
such Rollover Contribution is received by the Trustee.

 

21

 

Notwithstanding the foregoing, if a Participant’s interest under a qualified plan described in
Section 401(a) of the Code is distributed in connection with an acquisition of stock or assets by
an Employer or a Controlled Entity, the Participant’s entire outstanding loan under such plan may
be contributed as a Rollover Contribution to this Plan, in accordance with this Section 3.9,
provided that the transferor plan provides the Committee with a current favorable IRS determination
letter issued to such transferor plan and trust or such other evidence that the Committee in its
discretion deems satisfactory to establish that the proposed Rollover Contribution is in fact
eligible for rollover to the Plan and is made pursuant to and in accordance with applicable
provisions of the Code and Treasury Regulations. The Committee shall determine, in its discretion,
whether or not a distribution is made in connection with an acquisition of stock or assets by an
Employer or a Controlled Entity.

(d) A Participant who has made a Rollover Contribution in accordance with this Section, but
who has not otherwise become a Participant of the Plan in accordance with Section 2.2, shall become
a Participant coincident with such Rollover Contribution; provided, however, that such Participant
shall not have a right to defer Compensation, make contributions to the Plan, or have Employer
Contributions made on his behalf until he has otherwise satisfied the requirements imposed by
Section 2.2.

IV.

ALLOCATIONS AND LIMITATIONS

4.1 Allocation of Contributions to Accounts.

(a) Before-Tax Contributions made by the Employer on a Participant’s behalf shall be allocated
to such Participant’s Before-Tax Account. Further, Catch-Up Contributions pursuant to Section
3.1(h) made by the Employer on a Participant’s behalf shall be allocated to such Participant’s
Catch-Up Contribution Account.

(b) After-Tax Contributions made by a Participant pursuant to Section 3.2 shall be allocated
to such Participant’s After-Tax Account.

(c) Employer Matching Contributions made by the Employer on a Participant’s behalf shall be
allocated to such Participant’s Non-ESOP Subaccount (or, to the extent that such Employer Matching
Contributions are initially invested in Company Stock or Section 3.3(d) applies, to such
Participant’s ESOP Subaccount).

(d) The Employer Discretionary Contribution, if any, made pursuant to Section 3.4 for a Plan
Year shall be allocated to the Non-ESOP Subaccounts (or, to the extent that such Employer
Discretionary Contribution is initially invested in Company Stock or Section 3.4(c) applies, to the
ESOP Subaccounts) of Participants who (i) were Eligible Employees on the last day of such Plan
Year, or (ii) incurred a Severance from Employment during such Plan Year on or after Normal
Retirement Date or by reason of Total and Permanent Disability or death. The allocation to each
such eligible Participant’s Non-ESOP Subaccount (or ESOP Subaccount, if applicable) shall be that
portion of such Employer Discretionary Contribution which is in the same proportion that such
Participant’s Compensation for such Plan Year bears to the total of all such Participants’
Compensation for such Plan Year.

 

22

 

(e) The Employer Discretionary Qualified Matching Contributions, if any, made pursuant to
Section 3.5 for a Plan Year in order to satisfy the restrictions set forth in Section 3.1(e) shall
be allocated to the Before-Tax Accounts of Participants who (i) received an allocation of
Before-Tax Contributions for such Plan Year, and (ii) were not Highly Compensated Employees for
such Plan Year (each such Participant individually referred to as an “Eligible Participant” for
purposes of this Paragraph). Such allocation shall be made, first, to the Before-Tax Account of
the Eligible Participant who received the least amount of Compensation for such Plan Year until the
lesser of the limitation set forth in Treasury Regulation Section 1.401(k)-2(a)(6)(v) or the
limitation set forth in Section 4.4 (the “401(k) Additional Contribution Limitation”) has been
reached as to such Eligible Participant, then to the Before-Tax Account of the Eligible Participant
who received the next smallest amount of Compensation for such Plan Year until the 401(k)
Additional Contribution Limitation has been reached as to such Eligible Participant, and continuing
in such manner until the Employer Discretionary Qualified Matching Contribution for such Plan Year
has been completely allocated or the 401(k) Additional Contribution Limitation has been reached as
to all Eligible Participants.

(f) The Employer Discretionary Qualified Matching Contribution, if any, made pursuant to
Section 3.5 for a Plan Year in order to satisfy the restrictions set forth in Section 3.6 shall be
allocated to the Employer Contribution Accounts of Participants who (i) received an allocation of
Employer Matching Contributions for such Plan Year, and (ii) were not Highly Compensated Employees
for such Plan Year (each such Participant individually referred to as an “Eligible Participant” for
purposes of this Paragraph). Such allocation shall be made, first, to the Employer Contribution
Account of the Eligible Participant who received the least amount of Compensation for such Plan
Year until the lesser of the limitation set forth in Treasury Regulation Section 1.401(m)-2(a)(5)
or the limitation set forth in Section 4.4 (the “401(m) Additional Contribution Limitation”) has
been reached as to such Eligible Participant; then to the Employer Contribution Account of the
Eligible Participant who received the next smallest amount of Compensation for such Plan Year until
the 401(m) Additional Contribution Limitation has been reached as to such Eligible Participant, and
continuing in such manner until the Employer Discretionary Qualified Matching Contribution for such
Plan Year has been completely allocated or the 401(m) Additional Contribution Limitation has been
reached as to all Eligible Participants.

(g) If an Employer Discretionary Qualified Matching Contribution is made in order to satisfy
the restrictions set forth in both Section 3.1(e) and Section 3.6 for the same Plan Year, the
Employer Discretionary Qualified Matching Contributions made in order to satisfy the restrictions
set forth in Section 3.1(e) shall be allocated (pursuant to Paragraph (e) above) prior to
allocating the Employer Discretionary Qualified Matching Contribution made in order to satisfy the
restrictions set forth in Section 3.6 (pursuant to Paragraph (f) above). In determining the
application of the limitations set forth in Section 4.4 to the allocations of Employer
Discretionary Qualified Matching Contributions, all Annual Additions (as such term is defined in
Section 4.4) to a Participant’s Accounts other than Employer Discretionary Qualified Matching
Contributions shall be considered allocated prior to Employer Discretionary Qualified Matching
Contributions.

(h) Roth Contributions pursuant to Sections 3.1 and 3.2, as applicable, made by the Employer
on a Participant’s behalf shall be allocated to such Participant’s Roth Account.

(i) All contributions to the Plan shall be considered allocated to Participants’ Accounts no
later than the last day of the Plan Year for which they were made, as determined pursuant to
Article III, except that, for purposes of Section 4.3, contributions shall be considered allocated
to Participants’ Accounts when received by the Trustee.

 

23

 

4.2 Application of Forfeitures. Any amounts that are forfeited under any provision
hereof during a Plan Year shall be applied in the manner determined by the Committee to reduce
Employer Contributions and/or to pay expenses incident to the administration of the Plan and Trust.
Prior to such application, forfeited amounts shall be held in suspense and invested in the
Investment Fund or Funds designated from time to time by the Committee.

4.3 Valuation of Accounts. All amounts contributed to the Trust Fund shall be
invested as soon as administratively feasible following their receipt by the Trustee, and the
balance of each Account shall reflect the result of daily pricing of the assets in which such
Account is invested from the time of receipt by the Trustee until the time of distribution.

4.4 Limit on Annual Additions Under Section 415. Effective January 1, 2008,
contributions hereunder shall be subject to the limitations of Code Section 415 and Treasury
Regulations published pursuant to such Code Section on April 5, 2007, the provisions of which are
specifically incorporated by reference; to the extent any portion of this Section conflicts with
such Regulations, the provisions of the Regulations shall govern.

(a) The Annual Additions to a Participant’s Accounts hereunder (together with the Annual
Additions to the Participant’s account(s) under any other defined contribution plans required to be
aggregated with the Plan) for any Limitation Year may not exceed the lesser of:

(1) Forty-nine Thousand Dollars ($49,000.00), subject to cost-of-living increases as
allowed under Code Section 415(d); or

(2) One hundred percent (100%) of the Participant’s 415 Compensation for the Limitation
Year.

In the event the preceding limitations apply to an individual who is a Participant in this
Plan and was a Participant in any other defined contribution plan maintained by the Employer, the
limitations shall apply first to this Plan.

(b) For purposes of this Section the following definitions shall apply:

(1) “Annual Addition” shall mean the sum of the following additions to a Participant’s
Accounts for the Limitation Year (i) employer contributions (including salary reduction
contributions), (ii) employee contributions, and (iii) forfeitures, if any. For purposes of
this definition, “Annual Additions” to other Employer defined contribution plans (also taken
into account when applying the limitations in Paragraph (a) above) include any voluntary
employee contributions to an account in a qualified defined benefit plan and any employer
contribution to an individual retirement account or annuity under Code Section 408 or to a
medical account for a key employee under Code Section
401(h) or 419A(d), except that the 25%-of-pay limit below shall not apply to employer
contributions to a key employee’s medical account after his separation from service.

(2) “Limitation Year” shall be the Plan Year.

(c) In the event the limitations in this Section are not satisfied, correction shall be made
under the rules provided in Revenue Procedure 2008-50 (and any successor to that Revenue
Procedure).

 

24

 

4.5 Recharacterizations. In the event a Participant’s Before-Tax Contributions for a
Plan Year do not equal a limitation described in Section 3.1(h) for any reason whether or not
related to an election by a Participant, his Catch-Up Contributions, if any, for such Plan Year
shall be recharacterized as Before-Tax Contributions for all purposes to the extent necessary to
either (i) increase Before-Tax Contributions to equal such limitation, or (ii) exhaust the Catch-Up
Contributions made for such Plan Year; provided, however, in no event shall such recharacterized
Catch-Up Contributions be eligible to be matched by Employer Matching Contributions.

In the event a Participant who is eligible to elect Catch-Up Contributions pursuant to the
provisions of Section 3.1(h) is determined by the Committee, applying the provisions of Section
3.8, to have excess deferrals for a Plan Year, then before causing a distribution of such
Participant’s excess deferrals, the Committee may cause such Participant’s Before-Tax Contributions
to be recharacterized as Catch-Up Contributions to the extent necessary to either (i) exhaust his
excess deferrals, or (ii) increase his Catch-Up Contributions to the applicable limit under Section
414(v) of the Code for the Plan Year.

V.

INVESTMENT OF ACCOUNTS

5.1 Investment of ESOP Subaccounts. Participants’ ESOP Subaccounts shall be subject
to, and invested in accordance with, Article VI. Except as provided in Article VI, the remaining
provisions of this Article, other than Section 5.5, shall not apply to such ESOP Subaccounts.

5.2 Investment of Certain Employer Contributions. Subject to the Independent
Fiduciary’s authority, pursuant to Section 14.5, to terminate the availability of the Company Stock
Fund as an investment option under the Plan, Employer Matching Contributions and Employer
Discretionary Contributions, and any earnings thereon, shall be initially invested in the Company
Stock Fund. In the event the Independent Fiduciary terminates the availability of the Company
Stock Fund as an investment option under the Plan, the Independent Fiduciary shall designate an
alternative investment fund to receive Employer Matching Contributions and Employer Discretionary
Contributions pending further investment directions from the Participants and beneficiaries.

 

25

 

5.3 Investment of Accounts.

(a) Except as provided in Section 5.2, each Participant shall designate, in accordance with
the procedures established from time to time by the Committee, the manner in which the amounts
allocated to each of his Accounts shall be invested from among the Investment Funds made available
from time to time by the Committee, except that, subject to Section 14.5, there shall be a Company
Stock Fund and the Committee may not eliminate such fund. With respect to the portion of a
Participant’s Accounts that is subject to investment discretion, such Participant may designate one
of such Investment Funds for all the amounts allocated to such portion of his Accounts (except to
the extent otherwise provided by the Committee pursuant to Section 5.4 with respect to the VBO) or
he may split the investment of the amounts allocated to such portion of his Accounts between such
Investment Funds in such increments as the Committee may prescribe. Except as otherwise provided
in Section 14.5, if a Participant fails to make a designation (including, for example, with
respects to amounts deferred under Section 3.1(j)), then such portions of his Accounts shall be
invested in the Investment Fund or Funds designated by the Committee from time to time in a uniform
and nondiscriminatory manner.

(b) Except as provided in Section 5.2, a Participant may change his investment designation for
future contributions to be allocated to his Accounts. Any such change shall be made in accordance
with the procedures established by the Committee, and the frequency of such changes may be limited
by the Committee.

(c) A Participant may elect to convert his investment designation with respect to the amounts
already allocated to his Accounts (including, without limitation, the conversion of the investment
designation with respect to amounts invested in Company Stock pursuant to Section 5.2). Any such
conversion shall be made in accordance with the procedures established by the Committee, and the
frequency of such conversions may be limited by the Committee.

5.4 VBO Investments. One of the Investment Funds available for the investment of the
amounts in a Participant’s Accounts under the Plan shall be the VBO. A Participant may designate
that a portion of the amounts in his Accounts shall be invested in the VBO in accordance with the
procedures, and subject to any limitations, established by the Committee. Upon such a designation,
the amounts so invested in the VBO shall be available, in accordance with such Participant’s
directions, for the purchase and subsequent sale of such stocks, bonds, mutual fund units, and
other securities as the Committee shall make available from time to time. A Participant’s
directions with respect to any such purchases and sales shall be effected in accordance with the
procedures established by the Committee. Investment in the VBO by a Participant shall subject the
amounts in his Accounts to such annual, transactional, or other fees and expenses as the Committee
may determine. Further, investment in the VBO shall be subject to such other terms, conditions,
and limitations as the Committee may from time to time determine. Voting and other rights
associated with Participants’ investments in the VBO shall be exercisable by Participants to the
extent and in the manner determined by the Committee in its sole discretion.

 

26

 

5.5 Pass-Through Voting and Other Rights with Respect to Company Stock.

(a) Each Participant shall have the right to direct the Trustee as to the manner of voting and
the exercise of all other rights which a shareholder of record has with respect to shares (and
fractional shares) of Company Stock which have been allocated to the Participant’s Accounts
including, but not limited to, the right to sell or retain shares in a public or private tender
offer.

(b) All shares (and fractional shares) of Company Stock for which the Trustee has not received
timely Participant directions shall be voted or exercised by the Trustee in the same proportion as
the shares (and fractional shares) of Company Stock for which the Trustee received timely
Participant directions, except in the case where to do so would be inconsistent with the provisions
of Title I of the Act.

(c) Notwithstanding anything herein to the contrary, in the event of a tender offer for
Company Stock, the Trustee shall interpret a Participant’s silence as a direction not to tender the
shares of Company Stock allocated to the Participant’s Accounts and, therefore, the Trustee shall
not tender any shares (or fractional shares) of Company Stock for which it does not receive timely
directions to tender such shares (or fractional shares) from Participants, except in the case where
to do so would be inconsistent with the provisions of Title I of the Act.

5.6 Stock Splits and Stock Dividends. Stock or other securities received by the
Trustee by reason of a stock split, stock dividend, or recapitalization shall be appropriately
allocated to the Accounts of each affected Participant.

VI.

ESOP AND ESOP ALLOCATIONS

6.1 Article Controls. Any Plan provisions to the contrary notwithstanding, the
provisions of this Article shall control.

6.2 Purpose of ESOP. The purpose of the ESOP is to enable Participants to acquire an
ownership interest in the Company. As a means of accomplishing such purpose, the ESOP will be
invested primarily in Company Stock. The ESOP is also designed to provide a technique of corporate
finance to the Company or the Employer. Therefore, it may be used to accomplish the following
objectives: to provide Participants with beneficial ownership of Company Stock; to meet general
financing requirements of the Company or the Employer, including capital growth and transfer in the
ownership of Company Stock; and to receive loans (or other extensions of credit) to finance the
acquisition of Company Stock, with such loans (or credits) secured primarily by a commitment by the
Employer to pay contributions to the Trust in amounts sufficient to enable principal and interest
on such loans to be repaid.

6.3 Nature of the ESOP. The ESOP is designed to meet the requirements for an employee
stock ownership plan within the meaning of Section 4975(e)(7) of the Code and Section 407(d)(6) of
the Act, which may enter into one or more Exempt Loans. No loan shall be made to the ESOP which is
(i) a loan made by a disqualified person (as such term is defined in Section 4975(e) of the Code)
or (ii) a loan guaranteed by a disqualified person (as such term is
defined in Section 4975(e) of the Code) unless all of the requirements of this Article VI have
been satisfied. The ESOP Subaccounts shall be the portion of the Plan that constitutes an employee
stock ownership plan, and the ESOP is intended to be a stock bonus plan qualified under Section
401(a) of the Code.

 

27

 

6.4 Requirements as to Exempt Loan.

(a) The terms of any Exempt Loan shall comply with all the requirements necessary to
constitute an exempt loan within the meaning of Treasury Regulation Section 54.4975-7(b), including
each of the following requirements:

(1) The terms shall be as favorable to the ESOP as the terms of a comparable loan from
arm’s-length negotiations between independent parties;

(2) The interest rate shall be no more than a reasonable interest rate considering all
relevant factors including the amount and duration of the loan, the security and guarantee
involved, the credit standing of the ESOP and the guarantor of the loan and the interest
rate prevailing for comparable loans;

(3) The loan shall be without recourse against the ESOP;

(4) The loan must be for a specific term under which the number of years to maturity is
definitely ascertainable at all times;

(5) The loan may not be payable at the demand of any person except in the case of
default;

(6) The only assets of the ESOP that may be given as collateral for the loan are
Company Stock acquired with the proceeds of the same or Company Stock used as collateral on
a prior Exempt Loan and repaid with the proceeds of the same;

(7) No person entitled to payment under the loan shall have any right to assets of the
ESOP other than collateral given for the loan, contributions made to the ESOP to enable it
to meet its obligations under the loan and earnings attributable to such collateral and such
contributions;

(8) The value of ESOP assets transferred in satisfaction of the loan upon an event of
default shall not exceed the amount of the default;

(9) If the lender is a disqualified person (as such term is defined in Section 4975(e)
of the Code), ESOP assets may only be transferred upon default only upon and to the extent
of the failure of the ESOP to meet the payment schedule of the loan;

(10) Upon payment of any portion of the balance due on the loan, the assets pledged as
collateral for such portion shall be released from encumbrance; and

(11) The loan shall be repaid only from amounts contributed to the ESOP by the Employer
to enable the ESOP to repay such loan, earnings on such contributions and earnings on
Financed Stock acquired with the proceeds of such loan (including dividends and proceeds of
sale of such Financed Stock, so long as such use of proceeds complies with applicable
requirements of the Code and regulations thereunder).

 

28

 

(b) Any Exempt Loan must be primarily for the benefit of Participants and their beneficiaries.

(c) Except as provided in Section 6.10 or as otherwise permitted by Section 4975(e)(7) of the
Code and Treasury Regulations promulgated thereunder, Company Stock acquired with the proceeds of
an Exempt Loan shall not be subject to a put, call, or other option or buy-sell or similar
arrangement while held by or distributed from the Plan. The restrictive protections of this
Paragraph (c) shall be nonterminable with respect to Company Stock acquired with the proceeds of an
Exempt Loan and shall continue to exist regardless of whether such loan is repaid or the Plan
ceases to be an employee stock ownership plan within the meaning of Section 4975(e)(7) of the Code
and Treasury Regulations promulgated thereunder.

6.5 Use of Exempt Loan Proceeds.

(a) The proceeds of any Exempt Loan shall be used within a reasonable time after receipt
thereof to acquire Company Stock, to repay such loan or to repay a prior Exempt Loan.

(b) Company Stock acquired with the proceeds of any Exempt Loan shall at all times meet the
requirements of Section 409(l) of the Code.

(c) All shares of Company Stock acquired by the Plan with the proceeds of an Exempt Loan shall
be allocated to the Suspense Account and held therein until released pursuant to the provisions of
Section 6.7.

(d) In no event shall the proceeds of any Exempt Loan be used to enter into any transaction
pursuant to which a taxpayer may elect nonrecognition treatment under Section 1042 of the Code.

6.6 Loan Repayment Contributions. With respect to a Plan Year during which there are
shares of Financed Stock in the Suspense Account, the Employer shall make contributions to the ESOP
in the form of, first, Employer Matching Contributions and, then, Employer Discretionary
Contributions in an amount which, when added to dividends then available to amortize a then
outstanding Exempt Loan, is sufficient to enable the Trustee to pay any currently maturing
obligation under such Exempt Loan.

6.7 Release and Allocation of Financed Stock.

(a) The number of shares of Financed Stock to be released from the Suspense Account as soon as
practicable following any amortization of an Exempt Loan shall equal the number of shares of
Financed Stock in the Suspense Account immediately before release multiplied by a fraction. The
numerator of the fraction shall be the amount of the payment of
principal and interest on the Exempt Loan. The denominator of the fraction shall be the sum
of the numerator plus the principal and interest to be paid for all future periods over the
duration of the Exempt Loan repayment period. If the Financed Stock includes more than one class
of security, the number of shares to be released must be determined by applying the same fraction
to each class.

 

29

 

(b) Following any such amortization of an Exempt Loan, the aggregate amount described in
Paragraph (a) above for a Plan Year shall be allocated to Participants’ ESOP Subaccounts, first, as
provided in Section 4.1(c) for such Plan Year and, then, the excess of the released amount over the
Employer Matching Contributions for such Plan Year, if any, shall be allocated to Participants’
ESOP Subaccounts as provided in Section 4.1(d) for such Plan Year.

(c) In the event that the amount described in Paragraph (a) above includes assets other than
Company Stock, each allocation to a Participant’s ESOP Subaccount pursuant to this Section 6.7
shall contain a pro rata part of Company Stock and such other assets.

6.8 Investment of Accounts.

(a) Participants’ ESOP Subaccounts shall be invested primarily in shares of Company Stock
through the Company Stock Fund. For purposes of operational compliance with the requirement that
Participants’ ESOP Subaccounts shall be invested “primarily” in shares of Company Stock, such ESOP
Subaccounts, in the aggregate, will be deemed to be invested “primarily” in Company Stock if 80% or
more of the aggregate assets of such ESOP Subaccounts are invested in Company Stock.
Notwithstanding the foregoing, the portions of Participants’ ESOP Subaccounts consisting of shares
of Company Stock that were purchased with the proceeds of any “employer reversion” as such term is
defined in Section 4980(c)(2) of the Code (or a predecessor thereto) transferred to the Plan
(“Employer Reversion”) shall at all times prior to distribution in accordance with the provisions
of the Plan be invested 100% in shares of Company Stock.

(b) Notwithstanding the provisions of Paragraph (a) above, a Participant may elect, in
accordance with the procedures established by the Committee, to liquidate any or all of the Company
Stock held in his ESOP Subaccount (other than any portion of such Participant’s ESOP Subaccount
consisting of shares of Company Stock which were purchased with the proceeds of any Employer
Reversion) and transfer the amount resulting from such liquidation out of such ESOP Subaccount and
into his Non-ESOP Subaccount. Upon any such transfer, such amounts shall be subject to all of the
provisions of Article V and shall no longer be subject to the provisions of this Article VI.

(c) A Participant may elect, in accordance with the procedures established by the Committee,
to direct that any amounts held in his Non-ESOP Subaccount shall be reallocated to his ESOP
Subaccount. Amounts transferred pursuant to this Paragraph (c) shall be invested primarily in
Company Stock, shall be subject to the provisions of this Article VI, and shall no longer be
subject to the provisions of Article V except as expressly provided therein.

 

30

 

6.9 Dividends.

(a) Any dividends received by the Trustee which are attributable to Company Stock credited to
a Participant’s ESOP Subaccount shall be allocated upon receipt by the Trustee to the ESOP
Subaccount of such Participant to the same extent and in the same proportion as such dividends
would have been received by such Participant had he been the direct owner of the Company Stock
credited to his ESOP Subaccount. With respect to each Participant whose employment is terminated
for any reason, so long as there are any shares of Company Stock in such Participant’s ESOP
Subaccount, his ESOP Subaccount shall continue to receive dividend allocations pursuant to this
Paragraph.

(b) Any dividends received by the Trustee which are attributable to Company Stock credited to
the Suspense Account shall be used by the Trustee to make Exempt Loan payments until such Exempt
Loan has been repaid in full.

6.10 “Put” Option.

(a) A former Participant or designated beneficiary shall be granted, at the time that shares
of Company Stock are distributed to him from his ESOP Subaccount, a put option to sell the shares
of Company Stock to the Company (or its delegate). The put option shall extend for a period of
sixty (60) days following the date that the shares of Company Stock are distributed to the former
Participant or designated beneficiary, at which time the put option will temporarily lapse. After
the end of the Plan Year in which such put option lapses, and following notification to each former
Participant or beneficiary who continues to hold the distributed Company Stock of the value of such
Company Stock as of the end of such Plan Year, each such former Participant or beneficiary shall
have an additional put option for the sixty-day period immediately following the date such
notification is given to such former Participant or beneficiary. To exercise the put option
provided under this Section 6.10, a former Participant or designated beneficiary shall submit
written notice to the Committee of his desire to have the Company (or its delegate) purchase all or
a designated portion of the shares of Company Stock which were distributed to him from his ESOP
Subaccount. Upon receipt of such written notice, the Company (or its delegate) shall purchase the
tendered Company Stock or such portion thereof as was not purchased by the ESOP on the terms set
forth below. It is specifically provided that the trustee or custodian of a rollover individual
retirement account of a former Participant shall have the same put option as described herein with
respect to such former Participant.

(b) Any Company Stock purchased by the Company (or its delegate) pursuant to the put option
provided in Paragraph (a) above shall be purchased as soon as practicable after the exercise of
such put option, at a price equal to the fair market value of Company Stock as determined for the
date of such purchase. Payment by the Company (or its delegate) for shares of Company Stock
purchased pursuant to this put option shall be, as determined by the Company (or its delegate), by
(i) a single lump sum cash payment made within thirty (30) days of the date of exercise of the put
option by the former Participant or designated beneficiary, or (ii) in the case of Company Stock
which was received by the former Participant or designated beneficiary in a distribution
constituting the distribution within a single taxable year of the balance of the Participant’s ESOP
Subaccount under the Plan, in substantially equal annual installments over a
period beginning not later than thirty (30) days after the exercise of the put option by the
former Participant or designated beneficiary and not exceeding five (5) years after the put option
is exercised provided that provisions are made for adequate security for the purchaser’s debt
obligation and reasonable interest is paid with respect to the unpaid portion of the purchase
price.

(c) This Section 6.10 shall be inoperative in the event that the Company Stock which is
distributed from an ESOP Subaccount to a Participant or designated beneficiary is, at the time of
such distribution, listed on a national securities exchange registered under Section 6 of the
Securities Exchange Act of 1934 or quoted on a system sponsored by a national securities
association registered under Section 15A(b) of the Securities Exchange Act of 1934.

 

31

 

6.11 Right of First Refusal.

(a) Any Company Stock distributed from the Plan to a Participant or designated beneficiary
shall be subject to a “right of first refusal” in favor of the Plan. No such Participant or
designated beneficiary may sell, assign or, in any other manner, transfer (except by gift, devise
or intestate succession in which case such Company Stock shall continue to be subject to the right
of first refusal provided herein) such Company Stock prior to first giving written notice to the
Trustee which shall state the complete terms upon which the Participant or designated beneficiary
seeks to transfer the Company Stock. Upon receipt of such written notice, the Trustee, on behalf
of the Plan, shall have the right to purchase (a preferential right to which is hereby granted in
favor of the Trustee) the Company Stock upon the terms set forth below. The purchase price to the
Trustee shall be the fair market value of the Company Stock and, in determining the fair market
value of the Company Stock, the Trustee shall give due consideration to the purchase price offered
to the selling Participant or beneficiary by a third-party buyer. This “right of first refusal” in
favor of the Plan shall lapse upon the earlier of (i) the fourteenth day after the seller gives
written notice to the Trustee that an offer by a third-party buyer to purchase the Company Stock
has been received, including the complete terms of the proposed transfer, or (ii) the date the
Trustee delivers written notice to the seller that the Plan does not desire to exercise its right
to purchase the Company Stock thereby consenting to the proposed transfer on the terms set forth in
the selling Participant’s notice. If the Trustee, on behalf of the Plan, desires to exercise
affirmatively the preferential purchase right set forth above, the Trustee shall do so by giving
the required written notice within the fourteen day period described herein. The consummation of
any such purchase shall be on a mutually acceptable date as soon as practicable after giving such
written notice and the purchaser shall tender payment for any Company Stock purchased pursuant to
this Section 6.11(a) in the form of a single cash payment.

(b) Each stock certificate representing shares of Company Stock distributed from the Plan
subject to the “right of first refusal” provided by this Section shall bear the following legend
written conspicuously across the face, or written across the back and conspicuously referred to on
the face:

“The shares evidenced by this certificate are subject to the provisions of
Section 6.11 of the Dynegy Midwest Generation, Inc. 401(k) Savings Plan for
Employees Covered Under a Collective Bargaining Agreement. No sale, assignment or
transfer (other than by gift, devise or intestate succession in which
case such stock shall continue to be subject to the right of first refusal
provided herein) of any or all of the shares evidenced by this certificate, or any
interest in such shares, shall be valid or effective unless the terms and provisions
of such Section 6.11 have been fulfilled. Dynegy Inc. will furnish without charge a
copy of such Section containing a full statement of the applicable restrictions on
transfer or other disposition of the shares evidenced by this certificate, or any
interest in such shares, to the record holder of this certificate upon written
request to Dynegy Inc. at its principal place of business or registered office.”

 

32

 

(c) This Section 6.11 shall become inoperative as to all shareholders during any period in
which Company Stock is listed on a national securities exchange registered under Section 6 of the
Securities Exchange Act of 1934 or quoted on a system sponsored by a national securities
association registered under Section 15A(b) of the Securities Exchange Act of 1934. The
protections and rights of this Section are nonterminable with respect to Company Stock acquired
with the proceeds of an Exempt Loan and shall continue to exist regardless of whether such loan is
repaid or the Plan ceases to be an employee stock ownership plan within the meaning of Section
4975(e)(7) of the Code and Treasury Regulations promulgated thereunder.

6.12 Investment of Trust Fund in Company Stock. The Trustee shall purchase and
maintain in the Trust Fund sufficient shares of Company Stock to make distributions of such Company
Stock to Participants and their beneficiaries in accordance with the provisions of the Plan, and is
authorized to invest up to 100% of the Trust Fund in Company Stock. The Independent Fiduciary
shall determine the extent to which the Trust Fund shall be invested in Company Stock and shall
determine the price at which Company Stock will be purchased or sold. The Trustee shall act on the
Independent Fiduciary’s or Participant’s directions, as applicable, with respect to the purchase
and sale of Company Stock and shall have no liability for acting or refraining from acting with
respect to the shares of the Company Stock held hereunder from time to time. Amounts that would
otherwise be invested in Company Stock shall be invested in an interest-bearing account, or the
Trustee may hold such amounts uninvested for a reasonable period pending appropriate investment.

6.13 Company Stock Valuation. For purposes of determining the fair market value of
Company Stock, the Committee may direct that appraisals of the value of Company Stock be made by an
independent appraiser annually or at such more frequent periodic intervals as the Committee deems
appropriate and the Committee shall be entitled to base its determination as to the fair market
value of Company Stock upon the most recent of such independent appraisals. During any period when
Company Stock is not readily tradeable on an established securities market, all plan activities
involving Company Stock shall be based on valuations of Company Stock rendered by an independent
appraiser in accordance with the requirements of Section 401(a)(28) of the Code and Treasury
Regulations promulgated thereunder. This Section shall be inoperative in the event that the
Company Stock is listed on a national securities exchange registered under Section 6 of the
Securities Exchange Act of 1934 or quoted on a system sponsored by a national securities
association registered under Section 15A(b) of the Securities Exchange Act of 1934.

 

33

 

VII.

GENERAL BENEFITS

7.1 No Benefits Unless Herein Set Forth. Except as set forth in this Article, a
Participant who incurs a Severance from Employment prior to his Normal Retirement Date for any
reason other than death or who incurs a Total and Permanent Disability shall acquire no right to
any benefit from the Plan or the Trust Fund.

7.2 Severance from Employment Benefit. Each Participant who incurs a Severance from
Employment for any reason other than death shall be entitled to a Severance from Employment
benefit, payable at the time and in the form provided in Article IX, equal in value to the sum of
the amounts in his Accounts on his Benefit Commencement Date.

7.3 Disability Benefit. Each Participant who incurs a Total and Permanent Disability
shall be entitled to a disability benefit, payable at the time and in the form provided in Article
IX, equal in value to the sum of the amounts in his Accounts on his Benefit Commencement Date.

7.4 Vesting of Accounts. A Participant shall have a 100% vested and nonforfeitable
interest in each of his Accounts at all times.

VIII.

DEATH BENEFITS

8.1 Death Benefits. Upon the death of a Participant while an Employee, the
Participant’s designated beneficiary shall be entitled to a death benefit payable at the time and
in the form provided in Article IX, equal in value to the sum of the amount in the Participant’s
Accounts on his Benefit Commencement Date.

8.2 Designation of Beneficiaries.

(a) Each Participant shall have the right to designate the beneficiary or beneficiaries to
receive payment of his benefit in the event of his death. Each such designation shall be made by
executing the beneficiary designation form prescribed by the Committee and filing such form with
the Committee. Any such designation may be changed at any time by such Participant by execution
and filing of a new designation in accordance with this Section 8.2. Notwithstanding the
foregoing, if a Participant who is married on the date of his death has designated an individual or
entity other than his surviving spouse as his beneficiary, such designation shall not be effective
unless (i) such surviving spouse has consented thereto in writing and such consent (A) acknowledges
the effect of such specific designation, (B) either consents to the specific designated beneficiary
(which designation may not subsequently be changed by the Participant without spousal consent) or
expressly permits such designation by the Participant without the requirement of further consent by
such spouse, and (C) is witnessed by a Plan representative (other than the Participant) or a notary
public, or (ii) the consent of such spouse cannot be obtained because such spouse cannot be located
or because of other circumstances described by applicable Treasury Regulations. Any such consent
by such surviving spouse shall be irrevocable.

 

34

 

(b) If no beneficiary designation is on file with the Committee at the time of the death of
the Participant or if such designation is not effective for any reason as determined by the
Committee, the designated beneficiary or beneficiaries to receive such death benefit shall be as
follows:

(1) If a Participant leaves a surviving spouse, his designated beneficiary shall be
such surviving spouse; and

(2) If a Participant leaves no surviving spouse, his designated beneficiary shall be
(i) such Participant’s executor or administrator, or (ii) his heirs at law if there is no
administration of such Participant’s estate.

(c) Notwithstanding the preceding provisions of this Section and to the extent not prohibited
by state or federal law, if a Participant is divorced from his spouse and at the time of his death
is not remarried to the person from whom he was divorced, any designation of such divorced spouse
as his beneficiary under the Plan filed prior to the divorce shall be null and void unless the
contrary is expressly stated in writing filed with the Committee by the Participant. The interest
of such divorced spouse failing hereunder shall vest in the persons specified in Paragraph (b)
above as if such divorced spouse did not survive the Participant.

IX.

PAYMENT OF BENEFITS

9.1 Determination of Benefit Commencement Date.

(a) A Participant’s Benefit Commencement Date shall be the date that is as soon as
administratively feasible after the Participant or his beneficiary becomes entitled to a benefit
pursuant to Article VII or VIII unless the Participant has been reemployed by the Employer or a
Controlled Entity before such potential Benefit Commencement Date.

(b) Unless (i) the Participant has attained age sixty-five (65) or died, (ii) the Participant
consents to a distribution pursuant to Paragraph (a) within the one-hundred-eighty (180) day period
ending on the date payment of his benefit hereunder is to commence pursuant to Paragraph (a), or
(iii) the balance of the Participant’s Accounts is not in excess of $1,000, the Participant’s
Benefit Commencement Date shall be deferred to the date which is as soon as administratively
feasible after the earlier of the date the Participant attains age sixty-five (65) or the
Participant’s date of death, or such earlier date as the Participant may elect by written notice to
the Committee prior to such date. No less than thirty (30) days (unless such thirty-day period is
waived by an affirmative election in accordance with applicable Treasury Regulations) and no more
than one-hundred-eighty (180) days before his Benefit Commencement Date, the Committee shall inform
the Participant of his right to defer his Benefit Commencement Date and shall describe the
Participant’s Direct Rollover election rights pursuant to Section 9.3 below.

(c) A Participant’s Benefit Commencement Date shall in no event be later than the sixtieth
(60th) day following the close of the Plan Year during which such Participant attains,
or would have attained, his Normal Retirement Date or, if later, terminates his employment with the
Employer and all Controlled Entities.

 

35

 

(d) Subject to the provisions of Section 9.2 below, a Participant’s Benefit Commencement Date
shall not occur unless the Article VII or VIII event entitling the Participant (or his beneficiary)
to a benefit constitutes a distributable event described in Section 401(k)(2)(B) of the Code and
shall not occur while the Participant is employed by the Employer or any Controlled Entity
(irrespective of whether the Participant has become entitled to a distribution of his benefit
pursuant to Article VII or VIII).

(e) Paragraphs (a), (b), and (c) above notwithstanding, but subject to the provisions of
Section 9.2 below, a Participant and the beneficiary of a Participant who dies prior to his Benefit
Commencement Date, other than a Participant whose balance in his Accounts is not in excess of
$1,000, must file a claim for benefits in the manner prescribed by the Committee before payment of
his benefit will be made.

(f) For purposes of this Section, in determining whether a Participant’s balance in his
Accounts is not in excess of $1,000, the value of the Participant’s Account shall be determined
without regard to that portion of his Accounts which is attributable to Rollover Contributions (and
earnings allocable thereto) within the meaning of Sections 402(c), 403(a)(4), 403(b)(8),
408(d)(3)(A)(ii) and 457(e)(16) of the Code. If the value of a Participant’s Account is determined
to be $1,000 or less, then the Participant’s entire account balance (including amounts attributable
to such Rollover Contributions) shall be immediately distributed in a single lump sum payment.

9.2 Minimum Distribution Requirements. All distributions required under this Section
9.2 will be determined and made in accordance with the Treasury Regulations under Section 401(a)(9)
of the Code. The following provisions reflect such model amendments, but are not intended to
provide any right to any optional form of distribution not otherwise provided in the Plan.

(a) General Rules.

(1) Requirements of Treasury Regulations Incorporated. All distributions
required under this Section 9.2 will be determined and made in accordance with the Treasury
Regulations under Section 401(a)(9) of the Code.

(2) TEFRA Section 242(b)(2) Elections. Notwithstanding the other provisions of
this Section 9.2, 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.

(b) Time and Manner of Distribution.

(1) Required Beginning Date. A Participant’s entire interest will be
distributed, or begin to be distributed, to the Participant no later than the Participant’s
required beginning date.

 

36

 

(2) Death of Participant Before Distributions Begin. If the Participant dies
before distributions begin, the Participant’s entire interest will be distributed, or begin
to be distributed, no later than as follows:

(A) If the Participant’s surviving spouse is the Participant’s sole designated
beneficiary, distributions to the surviving spouse will begin by December 31 of the
calendar year immediately following the calendar year in which the Participant died,
or by December 31 of the calendar year in which the Participant would have attained
age 701/2, if later.

(B) If the Participant’s surviving spouse is not the Participant’s sole
designated beneficiary, distributions to the designated beneficiary will begin by
December 31 of the calendar year immediately following the calendar year in which
the Participant died.

(C) 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.

(D) 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)(2), other than
Subparagraph (b)(2)(A), will apply as if the surviving spouse were the Participant.

For purpose of this Subparagraph (b)(2) and Subsection (d), unless Subparagraph (b)(2)(D)
applies, distributions are considered to begin on the Participant’s required beginning date.
If Subparagraph (b)(2)(D) applies, distributions are considered to begin on the date
distributions are required to begin to the surviving spouse under Subparagraph (b)(2)(A).
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 Subparagraph (b)(2)(A)), 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 Subsections (c) and (d) of this Section 9.2. 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 promulgated thereunder.

 

37

 

(d) Required Minimum Distributions During Participant’s Lifetime.

(1) 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:

(A) The quotient obtained by dividing the Participant’s account balance by the
distribution period in the Uniform Lifetime Table set forth Treasury Regulations
Section 1.401(a)(9)-9, using the Participant’s age as of the Participant’s birthday
in the distribution calendar year; or

(B) 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 Treasury Regulations Section 1.401(a)(9)-9, using the Participant’s and
spouse’s attained ages as of the Participant’s and spouse’s birthdays in the
distribution calendar year.

(2) Lifetime Required Minimum Distributions Continue Through Year of Participant’s
Death. Required minimum distributions will be determined under this Subsection (c)
beginning with the first distribution calendar year and up to and including the distribution
calendar year that includes the Participant’s date of death.

(e) Required Minimum Distributions After Participant’s Death.

(1) Death On or After Date Distributions Begin.

(A) 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:

(i) 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.

(ii) 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.

 

38

 

(iii) 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.

(B) No Designated Beneficiary. If the Participant dies on or after the
date distributions begin and there is no designated beneficiary as of September
30th 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.

(2) Death Before Date Distributions Begin.

(A) Participant Survived by Designated Beneficiary. If the Participant
dies before 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 remaining life expectancy of the Participant’s
designated beneficiary, determined as provided in
Subparagraph (e)(1).

(B) 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.

(C) 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 Subparagraph (b)(2)(A), this Subparagraph (e)(2) will apply
as if the surviving spouse were the Participant.

(3) Definitions.

(A) Designated beneficiary. The individual who is designated as the
beneficiary under the applicable section of the Plan and is the designated
beneficiary under Section 401(a)(9) of the Code and Treasury Regulation Section
1.401(a)(9)-1, Q&A-4.

 

39

 

(B) Distribution calendar year. 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 Subparagraph (b)(2). 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. Life expectancy as computed by use of the Single
Life Table in Treasury Regulation Section 1.401(a)(9)-9.

(D) Participant’s account balance. 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.

(4) Required beginning date. The date specified in Section 401(a)(9)(C) of the
Code.

(f) A Designated Beneficiary that is not a surviving spouse may not elect a Direct Rollover of
an amount which is a required minimum distribution according to this Section 9.2 of the Plan. If
the Participant dies before his required beginning date and the nonspouse beneficiary elects a
Direct Rollover to an Eligible Retirement Plan the maximum amount eligible for a Direct Rollover,
the beneficiary may elect to use either the five (5) year rule or the Life expectancy rule, in
determining the required minimum distributions from the Eligible Retirement Plan that receives the
nonspouse beneficiary’s distribution.

9.3 Form of Payment and Payee.

(a) Subject to the provisions of Paragraph (b) below, a Participant’s benefit shall be
provided from the balance of such Participant’s Accounts under the Plan and shall be paid in cash
in one lump sum on the Participant’s Benefit Commencement Date. Except as provided in Section
18.4, the Participant’s benefit shall be paid to the Participant unless the Participant has died
prior to his Benefit Commencement Date, in which case the Participant’s benefit shall be paid to
his beneficiary designated in accordance with the provisions of Section 8.2.

 

40

 

(b) Benefits shall be paid (or transferred pursuant to Section 9.4) in cash except that a
Participant (or his designated beneficiary or legal representative in the case of a deceased
Participant) may elect to have the portion of his Accounts invested in Company Stock paid (or
transferred pursuant to Section 9.4) in full shares of such stock with any balance (including
fractional shares of Company Stock) to be paid or transferred in cash. Conversions of Company
Stock to cash and cash to Company Stock shall be based upon the value of Company Stock on the
Participant’s Benefit Commencement Date.

9.4 Direct Rollover Election. Notwithstanding any provision 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 Committee, to have all or any portion of an
Eligible Rollover Distribution (other than any portion attributable to the offset of an outstanding
loan balance of such Participant pursuant to the Plan’s loan procedure) paid directly to an
Eligible Retirement Plan specified by the Distributee in a Direct Rollover. The preceding sentence
notwithstanding, a Distributee may elect a Direct Rollover pursuant to this Section only if such
Distributee’s Eligible Rollover Distributions during the Plan Year are reasonably expected to total
$200 or more. Furthermore, if less than 100% of the Participant’s Eligible Rollover Distribution is
to be a Direct Rollover, the amount of the Direct Rollover must be $500 or more. Prior to any
Direct Rollover pursuant to this Section, the Committee may require the Distributee to furnish the
Committee with a statement from the plan, account, or annuity to which the benefit is to be
transferred verifying that such plan, account, or annuity is, or is intended to be, an Eligible
Retirement Plan.

Notwithstanding the preceding paragraph, effective January 1, 2008, a Direct Rollover from a
Participant’s Roth Account and/or After-Tax Account shall only be made to: (i) a qualified plan,
(ii) a 403(b) plan, or (iii) for Roth Accounts, a Roth individual retirement account described in
Section 408A of the Code and only to the extent the rollover is permitted under Section 402A(c) of
the Code, including accounting separately for the portion of such distribution which is includible
in gross income and the portion of such distribution which is not includible in gross income.

9.5 Transfers to Salaried Plan. If an Employee of the Employer or a Controlled Entity
(i) ceases to be an Eligible Employee, (ii) continues to be employed by the Employer or a
Controlled Entity, and (iii) coincident with his cessation as an Eligible Employee, becomes
eligible to participate in the Salaried Plan, then the sum of the amounts in his Accounts
(including any outstanding loans) as of the date of the transfer of assets hereinafter provided,
shall be transferred as soon as practicable after the cessation described in clause (i) above to
corresponding accounts under the Salaried Plan in accordance with the requirements of
Section 414(l) of the Code and the regulations thereunder, and, for periods after the date of such
cessation, he shall cease to be a Participant in the Plan and shall be a participant in the
Salaried Plan, subject to the terms and conditions of the Salaried Plan.

 

41

 

9.6 Notice of Direct Rollover Distribution. Effective for Plan Years beginning after
January 1, 2006, the Plan Administrator shall, within one-hundred-eighty (180) days before making
an eligible rollover distribution, provide a written explanation to the recipient:

(a) of the provisions under which the recipient may have the distribution directly transferred
to an Eligible Retirement Plan and that the automatic distribution by direct transfer applies to
certain distributions in accordance with
Section 401(a)(31)(B) of the Code;

(b) of the provision which requires the withholding of tax on the distribution if it is not
directly transferred to an Eligible Retirement Plan;

(c) of the provisions under which the distribution will not be subject to tax if transferred
to an Eligible Retirement Plan within sixty (60) days after the date on which the recipient
received the distribution;

(d) and of the provisions under which distributions from the Eligible Retirement Plan
receiving the distribution may be subject to restrictions and tax consequences which are different
from those applicable to distributions from the plan making such distribution.

9.7 Unclaimed Benefits. In the case of a benefit payable on behalf of a Participant,
if the Committee is unable to locate the Participant or beneficiary to whom such benefit is
payable, upon the Committee’s determination thereof, such benefit shall be forfeited. The timing
of such forfeiture shall comply with the time of payment rules described in Section 9.1.
Notwithstanding the foregoing, if subsequent to any such forfeiture the Participant or beneficiary
to whom such benefit is payable makes a valid claim for such benefit, such forfeited benefit shall
be restored to the Plan by having the forfeited amount restored to such Participant, unadjusted by
any subsequent gains or losses of the Trust Fund. Any such restoration shall be made as soon as
administratively feasible following the date of the submission of such valid claim.
Notwithstanding anything to the contrary in the Plan, forfeited amounts to be restored by the
Employer pursuant to this Section shall be charged against and deducted from forfeitures for the
Plan Year in which such amounts are restored that would otherwise be available to be applied
pursuant to Section 4.2. If such forfeitures otherwise available are not sufficient to provide
such restoration, the portion of such restoration not provided by forfeitures shall be charged
against and deducted from Employer Discretionary Contributions otherwise available for allocation
to other Participants in accordance with Section 4.1(d), and any additional amount needed to
restore such forfeited amounts shall be a minimum required Employer Discretionary Contribution
(which shall be made without regard to current or accumulated earnings and profits).

9.8 Claims Review.

(a) Definitions. For purposes of this Section, the following terms, when capitalized,
will be defined as follows:

(1) Adverse Benefit Determination: Any denial, reduction or termination of or
failure to provide or make payment (in whole or in part) for a Plan benefit, including any
denial, reduction, termination or failure to provide or make payment that is based on a
determination of a Claimant’s eligibility to participate in the Plan. Further, any
invalidation of a claim for failure to comply with the claim submission procedure will be
treated as an Adverse Benefit Determination.

 

42

 

(2) Benefits Administrator: The person or office to whom the Committee has
delegated day-to-day Plan administration responsibilities and who, pursuant to such
delegation, processes Plan benefit claims in the ordinary course.

(3) Claimant: A Participant or beneficiary or an authorized representative of
such Participant or beneficiary who has filed or desires to file a claim for a Plan benefit.

(b) Filing of Benefit Claim. To file a benefit claim under the Plan, a Claimant must
obtain from the Benefits Administrator the information and benefit election forms, if any, provided
for in the Plan and otherwise follow the procedures established from time to time by the Committee
or the Benefits Administrator for claiming Plan benefits. If, after reviewing the information so
provided, the Claimant needs additional information regarding his Plan benefits, he may obtain such
information by submitting a written request to the Benefits Administrator describing the additional
information needed. A Claimant may only request a Plan benefit by fully completing and submitting
to the Benefits Administrator the benefit election forms, if any, provided for in the Plan and
otherwise following the procedures established from time to time by the Committee or the Benefits
Administrator for claiming Plan benefits.

(c) Processing of Benefit Claim. Upon receipt of a fully completed benefit claim from
a Claimant, the Benefits Administrator shall determine if the Claimant’s right to the requested
benefit, payable at the time or times and in the form requested, is clear and, if so, shall process
such benefit claim without resort to the Committee. If the Benefits Administrator determines that
the Claimant’s right to the requested benefit, payable at the time or times and in the form
requested, is not clear, it shall refer the benefit claim to the Committee for review and
determination, which referral shall include:

(1) All materials submitted to the Benefits Administrator by the Claimant in connection
with the claim;

(2) A written description of why the Benefits Administrator was of the view that the
Claimant’s right to the benefit, payable at the time or times and in the form requested, was
not clear;

(3) A description of all Plan provisions pertaining to the benefit claim;

(4) Where appropriate, a summary as to whether such Plan provisions have in the past
been consistently applied with respect to other similarly situated Claimants; and

(5) Such other information as may be helpful or relevant to the Committee in its
consideration of the claim.

 

43

 

If the Claimant’s claim is referred to the Committee, the Claimant may examine any relevant
document relating to his claim and may submit written comments or other information to the
Committee to supplement his benefit claim. Within thirty (30) days of receipt from the Benefits
Administrator of a benefit claim referral (or such longer period as may be necessary due to
unusual circumstances or to enable the Claimant to submit comments), but in any event not later
than will permit the Committee sufficient time to fully and fairly consider the claim and make a
determination within the time frame provided in Paragraph (d) below, the Committee shall consider
the referral regarding the claim of the Claimant and make a decision as to whether it is to be
approved, modified or denied. If the claim is approved, the Committee shall direct the Benefits
Administrator to process the approved claim as soon as administratively practicable.

(d) Notification of Adverse Benefit Determination. In any case of an Adverse Benefit
Determination of a claim for a Plan benefit, the Committee shall furnish written notice to the
affected Claimant within a reasonable period of time but not later than ninety days after receipt
of such claim for Plan benefits (or within one-hundred eighty (180) days if special circumstances
necessitate an extension of the ninety (90)-day period and the Claimant is informed of such
extension in writing within the ninety (90)-day period and is provided with an extension notice
consisting of an explanation of the special circumstances requiring the extension of time and the
date by which the benefit determination will be rendered). Any notice that denies a benefit claim
of a Claimant in whole or in part shall, in a manner calculated to be understood by the Claimant:

(1) State the specific reason or reasons for the Adverse Benefit Determination;

(2) Provide specific reference to pertinent Plan provisions on which the Adverse
Benefit Determination is based;

(3) Describe any additional material or information necessary for the Claimant to
perfect the claim and explain why such material or information is necessary; and

(4) Describe the Plan’s review procedures 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 the Act following an Adverse Benefit Determination on review.

(e) Review of Adverse Benefit Determination. A Claimant has the right to have an
Adverse Benefit Determination reviewed in accordance with the following claims review procedure:

(1) The Claimant must submit a written request for such review to the Committee not
later than sixty (60) days following receipt by the Claimant of the Adverse Benefit
Determination notification;

(2) The Claimant shall have the opportunity to submit written comments, documents,
records, and other information relating to the claim for benefits to the Committee;

(3) The Claimant shall have the right to have all comments, documents, records, and
other information relating to the claim for benefits that have
been submitted by the Claimant considered on review without regard to whether such
comments, documents, records or information were considered in the initial benefit
determination; and

 

44

 

(4) The Claimant shall have reasonable access to, and copies of, all documents,
records, and other information relevant to the claim for benefits free of charge upon
request, including (i) documents, records or other information relied upon for the benefit
determination, (ii) documents, records or other information submitted, considered or
generated without regard to whether such documents, records or other information were relied
upon in making the benefit determination, and (iii) documents, records or other information
that demonstrates compliance with the standard claims procedure.

The decision on review by the Committee will be binding and conclusive upon all persons, and the
Claimant shall neither be required nor be permitted to pursue further appeals to the Committee.

(f) Notification of Benefit Determination on Review. Notice of the Committee’s final
benefit determination regarding an Adverse Benefit Determination will be furnished in writing or
electronically to the Claimant after a full and fair review. Notice of an Adverse Benefit
Determination upon review will:

(1) State the specific reason or reasons for the Adverse Benefit Determination;

(2) Provide specific reference to pertinent Plan provisions on which the Adverse
Benefit Determination is based;

(3) State that the Claimant is entitled to receive, upon request and free of charge,
reasonable access to, and copies of, all documents, records, and other information relevant
to the Claimant’s claim for benefits including (i) documents, records or other information
relied upon for the benefit determination, (ii) documents, records or other information
submitted, considered or generated without regard to whether such documents, records or
other information were relied upon in making the benefit determination, and (iii) documents,
records or other information that demonstrates compliance with the standard claims
procedure; and

(4) Describe the Claimant’s right to bring an action under Section 502(a) of the Act.

The Committee shall notify a Claimant of its determination on review with respect to the Adverse
Benefit Determination of the Claimant within a reasonable period of time but not later than sixty
days after the receipt of the Claimant’s request for review unless the Committee determines that
special circumstances require an extension of time for processing the review of the Adverse Benefit
Determination. If the Committee determines that such extension of time is required, written notice
of the extension (which shall indicate the special circumstances requiring the extension and the
date by which the Committee expects to render the determination on
review) shall be furnished to the Claimant prior to the termination of the initial sixty (60)-day
review period. In no event shall such extension exceed a period of sixty days from the end of the
initial sixty (60)-day review period. In the event such extension is due to the Claimant’s failure
to submit necessary information, the period for making the determination on a review will be tolled
from the date on which the notification of the extension is sent to the Claimant until the date on
which the Claimant responds to the request for additional information.

 

45

 

(g) Exhaustion of Administrative Remedies. Completion of the claims procedures
described in this Section will be a condition precedent to the commencement of any legal or
equitable action in connection with a claim for benefits under the Plan by a Claimant or by any
other person or entity claiming rights individually or through a Claimant; provided, however, that
the Committee may, in its sole discretion, waive compliance with such claims procedures as a
condition precedent to any such action.

(h) Payment of Benefits. If the Benefits Administrator or Committee determines that a
Claimant is entitled to a benefit hereunder, payment of such benefit will be made to such Claimant
(or commence, as applicable) as soon as administratively practicable after the date the Benefits
Administrator or Committee determines that such Claimant is entitled to such benefit or on any
other later date designated by and in the discretion of the Committee.

(i) Authorized Representatives. An authorized representative may act on behalf of a
Claimant in pursuing a benefit claim or an appeal of an Adverse Benefit Determination. An
individual or entity will only be determined to be a Claimant’s authorized representative for such
purposes if the Claimant has provided the Committee with a written statement identifying such
individual or entity as his authorized representative and describing the scope of the authority of
such authorized representative. In the event a Claimant identifies an individual or entity as his
authorized representative in writing to the Committee but fails to describe the scope of the
authority of such authorized representative, the Committee shall assume that such authorized
representative has full powers to act with respect to all matters pertaining to the Claimant’s
benefit claim under the Plan or appeal of an Adverse Benefit Determination with respect to such
benefit claim.

X.

IN-SERVICE WITHDRAWALS

10.1 In-Service Withdrawals.

(a) A Participant may withdraw from his After-Tax Account any or all amounts held in such
Account.

(b) A Participant may withdraw from his Rollover Contribution Account and/or his Class
Settlement Account any or all amounts held in either such Account.

(c) A Participant may withdraw from his TRASOP Transfer Account any or all amounts held in
such Account. Such withdrawal shall come from the Participant’s TRASOP Employee Subaccount and his
TRASOP Employer Subaccount on a pro rata basis.

 

46

 

(d) A Participant may withdraw from his Employer Contribution Account any or all amounts held
in such Account that have been so held for twenty-four (24) months or more (other than amounts held
in his Incentive Contribution Subaccount).

(e) A Participant who has completed at least sixty (60) cumulative months of participation in
the Plan may withdraw from his Employer Contribution Account any or all amounts held in such
Account (other than amounts held in his Incentive Contribution Subaccount).

(f) A Participant who has attained age fifty-nine and one-half (59-1/2) may withdraw from his
Before-Tax Account, Catch-Up Contribution Account and Incentive Contribution Subaccount, on a pro
rata basis, an amount not exceeding the then aggregate value of such Accounts and Subaccount.

(g) A Participant who has a financial hardship, as determined by the Committee, and who has
made all available withdrawals pursuant to (i) the Paragraphs above, and (ii) pursuant to the
provisions of any other plans of the Employer and any Controlled Entities of which he is a member
and who has obtained all available loans pursuant to Article XI and pursuant to the provisions of
any other plans of the Employer and any Controlled Entities of which he is a member may withdraw
from his Before-Tax Account and Catch-Up Contribution Account an amount not to exceed the lesser of
(i) the balance of such Accounts, or (ii) the amount required to meet the immediate financial need
created by the hardship. The amount required to meet the immediate financial need may include any
amounts necessary to pay any federal, state, or local income taxes or penalties reasonably
anticipated to result from the distribution. For purposes of this Paragraph, financial hardship
shall mean one of the following immediate and heavy financial needs of the Participant:

(1) Expenses for (or necessary to obtain) medical care that would be deductible under
Section 213(d) of the Code (determined without regard to whether the expenses 7.5% of
adjusted gross income);

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

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

(4) Payments necessary to prevent the eviction of the Participant from his principal
residence or foreclosure on the mortgage of the Participant’s principal residence;

(5) Payments for burial or funeral expenses for the Participant’s deceased parent,
spouse, children or dependents (as defined in Section 152 of the Code and without regard to
Sections 152(b)(1), (b)(2) and (d)(1)(B)); or

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

 

47

 

The above notwithstanding, (i) withdrawals under this Paragraph from a Participant’s Before-Tax
Account shall be limited to the sum of the Participant’s Before-Tax Contributions to the Plan, plus
income allocable to the Participant’s Before-Tax Contributions and credited to the Participant’s
Before-Tax Account as of December 31, 1988, less any previous withdrawals of such amounts, (ii)
withdrawals from a Participant’s Catch-Up Contribution Account shall be limited to the
Participant’s Catch-Up Contributions pursuant to Section 3.1(h), less any previous withdrawals of
such amounts, and (iii) Employer Discretionary Qualified Matching Contributions utilized to satisfy
the restrictions set forth in Section 3.1(e), and income allocable thereto, shall not be subject to
withdrawal. A Participant who receives a distribution pursuant to this Paragraph on account of
hardship shall be prohibited from making elective deferrals and employee contributions under this
and all other plans maintained by the Employer or any Controlled Entity for six (6) months after
receipt of the distribution.

10.2 Restriction on In-Service Withdrawals.

(a) All withdrawals pursuant to this Article shall be made in accordance with procedures
established by the Committee.

(b) Notwithstanding the provisions of this Article, (i) not more than one withdrawal pursuant
to each of Paragraphs (c), (d), (e), and (f) of Section 10.1 may be made in any one Plan Year, (ii)
no withdrawal shall be made from an Account to the extent such Account has been pledged to secure a
loan from the Plan, and (iii) any portion of an Account that is invested in the VBO shall not be
subject to withdrawal pursuant to Section 10.1.

(c) If a Participant’s Account from which a withdrawal is made is invested in more than one
Investment Fund, the withdrawal shall be made pro rata from each Investment Fund (other than the
VBO) in which such Account is invested.

(d) All withdrawals under this Article shall be paid in cash; provided, however, that a
Participant may elect to have withdrawals pursuant to Section 10.1 paid in full shares of Company
Stock (with any fractional shares to be paid in cash) to the extent that the Accounts from which
such withdrawals are made are invested in such stock.

(e) Any withdrawal hereunder that constitutes an Eligible Rollover Distribution shall be
subject to the Direct Rollover election described in Section 9.4.

(f) This Article shall not be applicable to a Participant following termination of employment
and the amounts in such Participant’s Accounts shall be distributable only in accordance with the
provisions of Article IX.

 

48

 

XI.

LOANS

The Plan authorizes the Trustee to make loans on a nondiscriminatory basis to a Participant or
beneficiary in accordance with the written loan policy established by the Committee attached to the
Plan as Appendix B, as amended from time to time; provided (i) the loan policy satisfies the
requirements of this Article XI; (ii) loans are available to all Participants and beneficiaries on
a reasonably equivalent basis and are not available in a greater amount for Highly Compensated
Employees than for other Employees; (iii) any loan is adequately secured and bears a reasonable
rate of interest; (iv) the loan provides for repayment within a specified time; (v) the default
provisions of the note prohibit offset of the Participant’s Account balance prior to the time the
Trustee otherwise would distribute the Participant’s Account balance; and (vii) the loan otherwise
conforms to the exemption provided by Section 4975(d)(1) of the Code.

The loan policy, attached to the Plan as Appendix B, must be a written document and must
include (i) the identity of the person or positions authorized to administer the participant loan
program; (ii) a procedure for applying for the loan; (iii) the criteria for approving or denying a
loan; (iv) the limitations, if any, on the types and amounts of loans available; (v) the procedure
for determining a reasonable rate of interest; (vi) the types of collateral which may secure the
loan; and (vii) the events constituting default and the steps the Plan will take to preserve Plan
assets in the event of default. This Section specifically incorporates the written loan policy
adopted by the Committee, as amended from time to time, attached to the Plan as Appendix B.

XII.

ADMINISTRATION OF THE PLAN

12.1 General Administration of the Plan. The general administration of the Plan shall
be vested in the Committee. For purposes of the Act, the Committee shall be the Plan
“administrator” and shall be the “named fiduciary” with respect to the general administration of
the Plan (except as to the investment of the assets of the Trust Fund). Each member of the
Committee shall serve until he resigns, dies or is removed by the Committee or the Compensation
Committee. The Committee may remove any of its members at any time, with or without cause, by
unanimous vote of the remaining members of the Committee and by written notice to such member;
further, the Compensation Committee may remove any of the Committee members, with or without cause,
and shall provide written notice to such member. Any member may resign by delivering a written
resignation to the Committee and the Compensation Committee, such resignation to become effective
as of a date specified in such notice that is on or after the date such notice is given as herein
provided. A member of the Committee who is an employee of the Company or any of its affiliates
shall cease to be a member of the Committee as of the date he ceases to be employed by the Company
or any of its affiliates. Vacancies in the Committee arising by death, resignation or removal
shall be filled by the Committee. The Committee may select officers (including a Chairman) and may
appoint a secretary who need not be a member of the Committee.

12.2 Records and Procedures. The Committee shall keep appropriate records of its
proceedings and the administration of the Plan and shall make available for examination during
business hours to any Participant or beneficiary such records as pertain to that individual’s
interest in the Plan. The Committee shall designate the person or persons who shall be
authorized to sign for the Committee and, upon such designation, the signature of such person or
persons shall bind the Committee.

 

49

 

12.3 Meetings. The Committee shall hold meetings upon such notice and at such time
and place as it may from time to time determine. Notice to a member shall not be required if
waived in writing by that member. A majority of the members of the Committee duly appointed shall
constitute a quorum for the transaction of business. All resolutions or other actions taken by the
Committee at any meeting where a quorum is present shall be by vote of a majority of those present
at such meeting and entitled to vote. Resolutions may be adopted or other action taken without a
meeting upon written consent signed by all of the members of the Committee. The Committee may hold
any meeting telephonically and any business conducted at a telephonic meeting shall have the same
force and effect as if the member had met in person.

12.4 Self-Interest of Members. No member of the Committee shall have any right to
vote or decide upon any matter relating solely to himself under the Plan or to vote in any case in
which his individual right to claim any benefit under the Plan is particularly involved. In any
case in which a Committee member is so disqualified to act and the remaining members cannot agree,
the Directors or the Compensation Committee shall appoint a temporary substitute member to exercise
all the powers of the disqualified member concerning the matter in which he is disqualified.

12.5 Compensation and Bonding. The members of the Committee shall not receive
compensation with respect to their services for the Committee. To the extent required by the Act
or other applicable law, or required by the Company, members of the Committee shall furnish bond or
security for the performance of their duties hereunder.

12.6 Committee Powers and Duties. The Committee shall supervise the administration
and enforcement of the Plan according to the terms and provisions hereof and shall have all powers
necessary to accomplish these purposes, including, but not by way of limitation, the right, power,
authority, and duty:

(a) To make rules, regulations, and bylaws for the administration of the Plan that are not
inconsistent with the terms and provisions hereof, provided such rules, regulations, and bylaws are
evidenced in writing and copies thereof are delivered to the Trustee and to the Company, and to
enforce the terms of the Plan and the rules and regulations promulgated thereunder by the
Committee;

(b) To construe in its discretion all terms, provisions, conditions, and limitations of the
Plan, and, in all cases, the construction necessary for the Plan to qualify under the applicable
provisions of the Code shall control;

(c) To correct any defect or to supply any omission or to reconcile any inconsistency that may
appear in the Plan in such manner and to such extent as it shall deem expedient in its discretion
to effectuate the purposes of the Plan;

 

50

 

(d) To employ and compensate such accountants, attorneys, investment advisors, and other
agents, employees, and independent contractors as the Committee may deem necessary or advisable for
the proper and efficient administration of the Plan;

(e) To determine in its discretion all questions relating to eligibility;

(f) To make a determination in its discretion as to the right of any person to a benefit under
the Plan and to prescribe procedures to be followed by distributees in obtaining benefits
hereunder;

(g) To prepare, file, and distribute, in such manner as the Committee determines to be
appropriate, such information and material as is required by the reporting and disclosure
requirements of the Act;

(h) To furnish the Company and the Employer any information necessary for the preparation of
the Company’s or such Employer’s tax return or other information that the Committee determines in
its discretion is necessary for a legitimate purpose;

(i) To require and obtain from the Employer and the Participants any information or data that
the Committee determines is necessary for the proper administration of the Plan;

(j) To instruct the Trustee as to the loans to Participants pursuant to the provisions of
Article XI;

(k) To appoint investment managers pursuant to Section 14.4;

(l) To receive and review reports from the Trustee and from investment managers as to the
financial condition of the Trust Fund, including its receipts and disbursements;

(m) To establish or designate Investment Funds as investment options as provided in Article V;
and

(n) To designate entities as participating Employers under the Plan pursuant to Article XVII.

Any provisions of the Plan to the contrary notwithstanding, benefits under the Plan will be paid
only if the Committee decides in its discretion that the applicant is entitled to them.

12.7 Employer to Supply Information. The Employer shall supply full and timely
information to the Committee, including, but not limited to, information relating to each
Participant’s Compensation, age, retirement, death, or other cause of termination of employment and
such other pertinent facts as the Committee may require. The Employer shall advise the Trustee of
such of the foregoing facts as are deemed necessary for the Trustee to carry out the Trustee’s
duties under the Plan. When making a determination in connection with the Plan, the Committee
shall be entitled to rely upon the aforesaid information furnished by the Employer.

 

51

 

12.8 Temporary Restrictions. In order to ensure an orderly transition in the transfer
of assets to the Trust Fund from another trust fund maintained under the Plan or from the trust
fund of a plan that is merging into the Plan or transferring assets to the Plan, the Committee may,
in its discretion, temporarily prohibit or restrict withdrawals, loans, changes to contribution
elections, changes of investment designation of future contributions, transfers of amounts from one
Investment Fund to another Investment Fund, or such other activity as the Committee deems
appropriate; provided that any such temporary cessation or restriction of such activity shall be in
compliance with all applicable law.

12.9 Indemnification. The Company shall indemnify and hold harmless each member of
the Committee and each Employee who is a delegate of the Committee against any and all expenses and
liabilities arising out of his administrative functions or fiduciary responsibilities, including
any expenses and liabilities that are caused by or result from an act or omission constituting the
negligence of such individual in the performance of such functions or responsibilities, but
excluding expenses and liabilities that are caused by or result from such individual’s own gross
negligence or willful misconduct. Expenses against which such individual shall be indemnified
hereunder shall include, without limitation, the amounts of any settlement or judgment, costs,
counsel fees, and related charges reasonably incurred in connection with a claim asserted or a
proceeding brought or settlement thereof.

XIII.

TRUSTEE AND ADMINISTRATION OF TRUST FUND

13.1 Trust Agreement. As a means of administering the assets of the Plan, the Company
has entered into a Trust Agreement. The administration of the assets of the Plan and the duties,
obligations, and responsibilities of the Trustee shall be governed by the Trust Agreement. The
Trust Agreement may be amended from time to time as the Company and the Trustee deem advisable in
order to effectuate the purposes of the Plan. The Trust Agreement is incorporated herein by
reference and thereby made a part of the Plan.

13.2 Payment of Expenses. All expenses incident to the administration of the Plan and
Trust (whether incurred before or after the Effective Date), including but not limited to, legal,
accounting, Trustee fees, direct expenses of the Company, the Employer and the Committee in the
administration of the Plan, and the cost of furnishing any bond or security required of the
Committee shall be paid by the Trustee from the Trust Fund, and, until paid, shall constitute a
claim against the Trust Fund which is paramount to the claims of Participants and beneficiaries;
provided, however, that (i) the obligation of the Trustee to pay such expenses from the Trust Fund
shall cease to exist to the extent such expenses are paid by the Company or the Employer, and (ii)
in the event the Trustee’s compensation is to be paid, pursuant to this Section, from the Trust
Fund, any individual serving as Trustee who already receives full-time pay from the Company, an
Employer or an association of Employers whose employees are Participants, or from an employee
organization whose members are Participants, shall not receive any additional compensation for
serving as Trustee. This Section shall be deemed to be a part of any contract to provide for
expenses of Plan and Trust administration, whether or not the signatory to such contract is, as a
matter of convenience, the Company or the Employer.

 

52

 

13.3
Trust Fund Property. All income, profits, recoveries, contributions,
forfeitures, and any and all moneys, securities, and properties of any kind at any time received or
held by the Trustee hereunder shall be held for investment purposes as a commingled Trust Fund.
The Committee shall maintain Accounts in the name of each Participant, but the maintenance of an
Account designated as the Account of a Participant shall not mean that such Participant shall have
a greater or lesser interest than that due him by operation of the Plan and shall not be considered
as segregating any funds or property from any other funds or property contained in the commingled
fund. No Participant shall have any title to any specific asset in the Trust Fund.

13.4
Distributions from Participants’ Accounts. Distributions from a Participant’s
Accounts shall be made by the Trustee only if, when, and in the amount and manner directed by the
Committee. Any distribution made to a Participant or for his benefit shall be debited to such
Participant’s Account or Accounts. All distributions hereunder shall be made in cash except as
otherwise specifically provided herein.

13.5
Payments Solely front Trust Fund. All benefits payable under the Plan shall be
paid or provided for solely from the Trust Fund, and neither the Company, the Employer nor the
Trustee assumes any liability or responsibility for the adequacy thereof. The Committee or the
Trustee may require execution and delivery of such instruments as are deemed necessary to assure
proper payment of any benefits.

13.6
No Benefits to Company/Employer. No part of the corpus or income of the Trust
Fund shall be used for any purpose other than the exclusive purpose of providing benefits for the
Participants and their beneficiaries and of defraying reasonable expenses of administering the Plan
and Trust. Anything to the contrary herein notwithstanding, the Plan shall not be construed to
vest any rights in the Company or the Employer other than those specifically given hereunder.

XIV.

FIDUCIARY PROVISIONS

14.1 Article Controls. This Article shall control over any contrary, inconsistent or
ambiguous provisions contained in the Plan.

14.2 General Allocation of Fiduciary Duties. Each fiduciary with respect to the Plan
shall have only those specific powers, duties, responsibilities and obligations as are specifically
given him under the Plan. The Directors shall have the sole authority to appoint and remove the
Trustee. Except as otherwise specifically provided herein, the Committee shall have the sole
responsibility for the administration of the Plan, which responsibility is specifically described
herein. Except as otherwise specifically provided herein and in the Trust Agreement, the Trustee
shall have the sole responsibility for the administration, investment, and management of the assets
held under the Plan. It is intended under the Plan that each fiduciary shall be responsible for
the proper exercise of his own powers, duties, responsibilities, and obligations hereunder and
shall not be responsible for any act or failure to act of another fiduciary except to the extent
provided by law or as specifically provided herein.

 

53

 

14.3 Delegation of Fiduciary Duties. The Committee may appoint subcommittees,
individuals, or any other agents as it deems advisable and may delegate to any of such appointees
any or all of the powers and duties of the Committee. Such appointment and delegation must specify
in writing the powers or duties being delegated, and must be accepted in writing by the delegatee.
Upon such appointment, delegation, and acceptance, the delegating Committee members shall have no
liability for the acts or omissions of any such delegatee, as long as the delegating Committee
members do not violate any fiduciary responsibility in making or continuing such delegation.

14.4 Investment Manager. The Committee may, in its sole discretion, appoint an
“investment manager,” with power to manage, acquire, or dispose of any asset of the Plan and to
direct the Trustee in this regard, so long as:

(a) The investment manager is (i) registered as an investment adviser under the Investment
Advisers Act of 1940, (ii) not registered as an investment adviser under such act by reason of
Paragraph (1) of Section 203A(a) of such act, is registered as an investment adviser under the laws
of the state (referred to in such Paragraph (1)) in which it maintains its principal office and
place of business, and, at the time it last filed the registration form most recently filed by it
with such state in order to maintain its registration under the laws of such state, also filed a
copy of such form with the Secretary of Labor, (iii) a bank, as defined in the Investment Advisers
Act of 1940, or (iv) an insurance company qualified to do business under the laws of more than one
state; and

(b) Such investment manager acknowledges in writing that he is a fiduciary with respect to the
Plan.

Upon such appointment, the Committee shall not be liable for the acts of the investment manager, as
long as the Committee members do not violate any fiduciary responsibility in making or continuing
such appointment. The Trustee shall follow the directions of such investment manager and shall not
be liable for the acts or omissions of such investment manager. The investment manager may be
removed by the Committee at any time and within the Committee’s sole discretion.

14.5
Independent Fiduciary. The Committee may, at its sole discretion, appoint an
Independent Fiduciary, who must be an investment manager as defined in Section 14.4(a), with the
sole and exclusive authority and responsibility on behalf of the Plan to exercise all authority to:

(a) Determine whether acquiring or holding Company Stock in the Plan is no longer consistent
with the Act, if so, to determine whether to:

(1) Prohibit or limit (for example, as a percentage of a Participant’s Account) further
purchases or holdings of Company Stock or increasing the Company Stock Fund’s holding of
cash or cash equivalent investments, and in the event of such prohibition or limitation, to
designate, as necessary, an alternative investment fund for the investment of the proceeds
or contributions pending further investment directions from the Participants and
beneficiaries;

 

54

 

(2) Liquidate some or all of the Plan’s holdings in the Company Stock Fund and
determine how such liquidation should be accomplished and in the event of such liquidation,
to designate, as necessary, an alternative investment fund for the investment of the
proceeds or contributions pending further investment directions from the Participants and
beneficiaries; or

(3) Terminate the availability of the Company Stock Fund as an investment option under
the Plan on such terms and conditions as the Independent Fiduciary shall deem prudent and in
the interests of the Plan, Participants and beneficiaries (and notwithstanding any
Participant or beneficiary investment directions to the contrary), including the
determination of the manner and timing of termination of the Company Stock Fund and orderly
liquidation of its assets and designation of an alternative investment fund for the
investment of the proceeds or contributions pending further investment directions from the
Participants and beneficiaries.

(b) Direct the Trustee to execute and deliver to the Independent Fiduciary such forms and
other documents as the Independent Fiduciary may determine are advisable to be filed with the
Securities and Exchange Commission or other governmental agency.

(c) Serve as the fiduciary responsible for ensuring the confidentiality of the proxy voting
process.

(d) Subject to the Committee’s right to reasonable notice and opportunity to review and
comment on any proposed communication to Participants, which comments shall be reflected in such
communication except to the extent the Independent Fiduciary reasonably determines such comments to
be inconsistent with their duties as detailed herein, direct the Plan’s record keeper to make such
communications to Participants and beneficiaries as the Independent Fiduciary reasonably determines
to be necessary in connection with the exercise of its responsibilities with respect to the Plan.

Upon such appointment, the Committee shall not be liable for the acts of the Independent Fiduciary.
An Independent Fiduciary may be removed by the Committee at any time and within its sole
discretion.

XV.

AMENDMENTS

15.1 Right to Amend. Subject to Section 15.2 and any other limitations contained in
the Act or the Code, the Directors or the Compensation Committee of the Company’s Board of
Directors may from time to time amend, in whole or in part, any or all of the provisions of the
Plan on behalf of the Company and all Employers; provided, however, that (i) any amendments to the
Plan that do not have a significant cost impact on the Employer may also be made by the Committee,
and (ii) any amendments to the Plan that do not have any cost impact on the Employer may also be
made by the Chairman of the Committee. Further, but not by way of limitation, the Directors, the
Compensation Committee of the Company’s Board of Directors, the Committee, or the Chairman of the
Committee may make any amendment necessary to acquire
and maintain a qualified status for the Plan under the Code or to maintain the Plan in
compliance with applicable law, whether or not retroactive.

 

55

 

15.2 Limitation on Amendments. No amendment of the Plan shall be made that would vest
in the Employer, directly or indirectly, any interest in or control of the Trust Fund. No
amendment shall be made that would vary the Plan’s exclusive purpose of providing benefits to
Participants and their beneficiaries and of defraying reasonable expenses of administering the Plan
or that would permit the diversion of any part of the Trust Fund from that exclusive purpose. No
amendment shall be made that would reduce any then nonforfeitable interest of a Participant. No
amendment shall increase the duties or responsibilities of the Trustee unless the Trustee consents
thereto in writing.

No amendment shall retroactively decrease a Participant’s accrued benefits or otherwise
retroactively place greater restrictions or conditions on a Participant’s rights to Code Section
411(d)(6) protected benefits, even if the amendment adds a restriction or condition that is
otherwise permitted under Code Section 411(a), unless otherwise permitted under Treasury
Regulations Sections 1.411(d)-3 or 1.411(d)-4. Effective January 1, 2007, an optional form of
benefit hereunder may be eliminated prospectively provided that the Plan will satisfy the
requirements of Treasury Regulations Sections 1.411(d)-3(c), (d) or (e) or 1.411(d)-4.

XVI.

DISCONTINUANCE OF CONTRIBUTIONS, TERMINATION, PARTIAL

TERMINATION, AND MERGER OR CONSOLIDATION

16.1 Right to Discontinue Contributions, Terminate, or Partially Terminate. The
Company and the Employer have established the Plan with the bona fide intention and expectation
that from year to year it will be able to, and will deem it advisable to, make its contributions as
herein provided. However, the Company and the Employer realize that circumstances not now
foreseen, or circumstances beyond its control, may make it either impossible or inadvisable for the
Employer to continue to make its contributions to the Plan. Therefore, the Directors shall have
the right and the power to discontinue contributions to the Plan, terminate the Plan, or partially
terminate the Plan at any time hereafter. Each member of the Committee and the Trustee shall be
notified of such discontinuance, termination, or partial termination.

16.2 Procedure in the Event of Discontinuance of Contributions, Termination, or Partial
Termination.

(a) If the Plan is amended so as to permanently discontinue Employer Contributions, or if
Employer Contributions are in fact permanently discontinued, the Committee shall remain in
existence and all other provisions of the Plan that are necessary, in the opinion of the Committee,
for equitable operation of the Plan shall remain in force.

(b) Unless the Plan is otherwise amended prior to dissolution of the Company, the Plan shall
terminate as of the date of dissolution of the Company.

 

56

 

(c) Upon discontinuance of contributions, termination, or partial termination, any previously
unallocated contributions and forfeitures shall be allocated among the Accounts of the Participants
on such date of discontinuance, termination, or partial termination according to the provisions of
Article IV. The net income (or net loss) of the Trust Fund shall continue to be allocated to the
Accounts of the Participants until the balances of the Accounts are distributed.

(d) In the case of a termination of the Plan, the Accounts of a Participant shall, subject to
the consent provisions of Article IX, be distributed to such Participant in a “lump sum
distribution” as such term is defined below; provided, however, a distribution may not be made if
the Employer establishes or maintains another “Alternative Defined Contribution Plan.” For
purposes of this Section 16.2(d), an “Alternative Defined Contribution Plan” is a defined
contribution plan that exists at any time during the period beginning on the date of Plan
termination and ending twelve (12) months after distribution of all assets from the terminated
Plan. However, if at all times during the twenty-four (24)-month period beginning twelve (12)
months before the date of Plan termination, fewer than 2% of the employees who were eligible under
the defined contribution plan that includes the cash or deferred arrangement as of the date of Plan
termination are eligible under the other defined contribution plan, the other Plan is not an
Alternative Defined Contribution Plan. In addition, a defined contribution plan is not treated as
an Alternative Defined Contribution Plan if it is an employee stock ownership plan, as defined in
Section 4975(e)(7) or Section 409(a) of the Code, a simplified employee pension plan as defined in
Section 408(k) of the Code, a SIMPLE IRA plan as defined in Section 408(p) of the Code, a plan
or contract that satisfies the requirements of Section 403(b) of the Code, or a plan that is
described in Section 457(b) or (f) of the Code. The term “lump sum distribution” shall have the
meaning provided in Section 402(e)(4)(D) of the Code (without regard to Section 402(e)(4)(D)(i)(I),
(II), (III) and (IV) of the Code). In the case of a Participant who is affected by a partial
termination of the Plan, the Accounts of such Participant shall, subject to the consent provisions
of Article IX, be distributed in accordance with the applicable provisions of Article IX after he
has incurred a Severance from Employment.

16.3 Merger, Consolidation, or Transfer. This Plan and Trust Fund may not merge or
consolidate with, or transfer its assets or liabilities to, any other plan, unless immediately
thereafter each Participant would, in the event such other plan terminated, be entitled to a
benefit which is equal to or greater than the benefit to which he would have been entitled if the
Plan were terminated immediately before the merger, consolidation, or transfer.

XVII.

PARTICIPATING EMPLOYERS

17.1 Designation of Other Employers.

(a) The Committee may designate any entity or organization eligible by law to participate in
the Plan and the Trust as an Employer by written instrument delivered to the Secretary of the
Company and the designated Employer. Such written instrument shall specify the effective date of
such designated participation, may incorporate specific provisions relating to the operation of the
Plan that apply to the designated Employer only and shall become, as to such designated Employer
and its Employees, a part of the Plan.

 

57

 

(b) Each designated Employer shall be conclusively presumed to have consented to its
designation and to have agreed to be bound by the terms of the Plan and Trust Agreement and any and
all amendments thereto upon its submission of information to the Committee required by the terms of
or with respect to the Plan or upon making a contribution to the Trust Fund pursuant to the terms
of the Plan; provided, however, that the terms of the Plan may be modified so as to increase the
obligations of an Employer only with the consent of such Employer, which consent shall be
conclusively presumed to have been given by such Employer upon its submission of any information to
the Committee required by the terms of or with respect to the Plan or upon making a contribution to
the Trust Fund pursuant to the terms of the Plan following notice of such modification.

(c) The provisions of the Plan and the Trust Agreement shall apply separately and equally to
each Employer and its Employees; provided, however, that that the power to appoint or otherwise
affect the Committee or the Trustee and the power to amend or terminate the Plan and Trust
Agreement shall be exercised by the Company or the Directors, as applicable, alone (except as
provided in Section 15.1), and, in the case of Employers which are Controlled Entities, Employer
Discretionary Contributions to be allocated pursuant to Section 4.1(d) shall be allocated on an
aggregate basis among the Participants employed by all Employers; provided, however, that each
Employer shall contribute to the Trust Fund its share of the total Employer Discretionary
Contribution for a Plan Year based on the Participants in its employ during such Plan Year.

(d) Transfer of employment among Employers shall not be considered a Severance from Employment
hereunder.

(e) Any Employer may, by appropriate action of its Board of Directors or noncorporate
counterpart communicated in writing to the Secretary of the Company and to the Committee, terminate
its participation in the Plan and the Trust. Moreover, the Committee may, in its discretion,
terminate an Employer’s Plan and Trust participation at any time by written instrument delivered to
the Secretary of the Company and the designated Employer.

(f) All participating Employers shall be listed on Appendix A of the Plan.

17.2 Single Plan. For purposes of the Code and the Act, the Plan as adopted by the
Employers shall constitute a single plan rather than a separate plan of each Employer. All assets
in the Trust Fund shall be available to pay benefits to all Participants and their beneficiaries,

XVIII.

MISCELLANEOUS PROVISIONS

18.1 Not Contract of Employment. The adoption and maintenance of the Plan shall not
be deemed to be either a contract between the Employer and any person or consideration for the
employment of any person. Nothing herein contained shall be deemed to give any person the right to
be retained in the employ of the Employer or to restrict the right of the Employer to discharge any
person at any time nor shall the Plan be deemed to give the Employer the right to require any
person to remain in the employ of the Employer or to restrict any person’s right to sever his
employment at any time.

 

58

 

18.2 Spendthrift Clause. Except as provided below, no Participant, former Participant
or beneficiary shall have the right to anticipate, assign or alienate any benefit provided under
the Plan, and the Trustee will not recognize any anticipation, assignment or alienation.
Furthermore, a benefit under the Plan is not subject to attachment, garnishment, levy, execution or
other legal or equitable process. All provisions of this Section 18.2 shall be for the exclusive
benefit of those designated herein. These restrictions shall not apply in the following case(s):

(a) Distributions Pursuant to Qualified Domestic Relations Orders. The Committee may
direct the Trustee under the nondiscriminatory policy adopted by the Committee to pay an Alternate
Payee designated under a “qualified domestic relations order” as defined in Section 414(p) of the
Code (or any domestic relations order entered before January 1, 1985 if payment of benefits
pursuant to the order has commenced as of that date). To the extent provided under a qualified
domestic relations order, a former spouse of a Participant shall be treated as the spouse or
surviving spouse for all purposes of the Plan.

Upon receipt of a qualified domestic relations order, the Committee shall direct the Trustee
to pay the Alternate Payee designated under such qualified domestic relations order the benefits
awarded thereunder at the time and in the form elected by the Alternate Payee, subject to the
limitations of Article IX and the applicable Treasury Regulations. Unless otherwise provided in the
qualified domestic relations order, an Alternate Payee shall be eligible to receive payment as soon
as administratively feasible following the Committee’s receipt of the Alternate Payee’s written
election for payment of benefits. The Committee shall adopt such procedures as necessary, in
accordance with a nondiscriminatory policy, to effect the orderly administration of this Section
18.2(a). The amount payable, unless otherwise specified in the qualified domestic relations order,
shall be determined as of the day immediately preceding the date of distribution to the Alternate
Payee.

A qualified domestic relations order that otherwise satisfies the requirements under Section
414(p) of the Code will not fail to be a qualified domestic relations order (i) solely because the
order is issued after, or revises, another domestic relations order or a qualified domestic
relations order, 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.

(b) Distributions Pursuant to Certain Judgments or Orders. The Committee may direct
the Trustee to comply with a judgment or settlement which requires the Trustee to reduce a
Participant’s benefits under the Plan by an amount that the Participant is ordered or required to
pay to the Plan if each of the following criteria are satisfied:

(1) The order or requirement must arise:

(A) Under a judgment of conviction for a crime involving the Plan;

(B) Under a civil judgment (including a consent order or decree) entered by a
court in an action brought in connection with an actual or alleged violation of Part
4 of Title I of the Act; or

 

59

 

(C) Under a settlement agreement with either the Secretary of Labor or the
Pension Benefit Guaranty Corporation and the Participant in connection with an
actual or alleged violation of Part 4 of Title I of the Act by a fiduciary or any
other person.

(2) The decree, judgment, order or settlement must expressly provide for the offset of
all or part of the amount ordered or required to be paid to the Plan against the
Participant’s benefits under the Plan.

(3) In addition, if the joint and survivor annuity requirements of Section 401(a)(11)
of the Code apply with respect to distributions from the Plan to the Participant and the
Participant has a spouse at the time at which the offset is to be made, then one of the
following three conditions must be satisfied:

(A) Such spouse has consented in writing to such offset and such consent is
witnessed by a notary public or representative of the Plan (or it is established to
the satisfaction of a Plan representative that such consent may not be obtained by
reason of circumstances described in Section 417(a)(2)(B) of the Code), or an
election to waive the right of the spouse to either a qualified joint and survivor
annuity or a qualified preretirement survivor annuity is in effect in accordance
with the requirements of Section 417(a) of the Code;

(B) Such spouse is ordered or required in such judgment, order, decree, or
settlement to pay an amount to the Plan in connection with a violation of part 4 of
subtitle B of Title I of the Act; or

(C) In such judgment, order, decree, or settlement, such spouse retains the
right to receive the survivor annuity under a qualified joint and survivor annuity
provided pursuant to Section 401(a)(11)(A)(i) of the Code and under a qualified
preretirement survivor annuity provided pursuant to Section 401(a)(11)(A)(ii) of the
Code, determined in accordance with Section 401(a)(13)(D) of the Code.

18.3 Uniformed Services Employment and Reemployment Rights Act Requirements.
Notwithstanding any provision of the 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.

18.4 Payments to Minors and Incompetents. If a Participant or beneficiary entitled to
receive a benefit under the Plan is a minor or is determined by the Committee in its discretion to
be incompetent or is adjudged by a court of competent jurisdiction to be legally incapable of
giving valid receipt and discharge for a benefit provided under the Plan, the Committee may pay
such benefit to the duly appointed guardian or conservator of such Participant or beneficiary for
the account of such Participant or beneficiary. If no guardian or conservator has been appointed
for such Participant or beneficiary, the Committee may pay such benefit to any third party who is
determined by the Committee, in its sole discretion, to be authorized to receive such benefit for
the account of such Participant or beneficiary. Such payment shall operate as a full discharge
of all liabilities and obligations of the Committee, the Trustee, the Company, the Employer,
and any fiduciary of the Plan with respect to such benefit.

 

60

 

18.5 Acquisition and Holding of Company Stock. The Plan is specifically authorized to
acquire and hold up to 100% of its assets in Company Stock so long as Company Stock is a
“qualifying employer security,” as such term is defined in Section 407(d)(5) of the Act.

18.6 Power of Attorney Designations. In accordance with the procedures established by
the Committee, a Participant may grant any individual a “Power of Attorney” to exercise, on behalf
of such Participant, any investment designation or conversion rights available to such Participant
under the Plan with respect to such Participant’s Accounts.

18.7 Participant’s and Beneficiary’s Addresses. It shall be the affirmative duty of
each Participant to inform the Committee of, and to keep on file with the Committee, his current
mailing address and the current mailing address of his designated beneficiary. If a Participant
fails to keep the Committee informed of his current mailing address and the current mailing address
of his designated beneficiary, neither the Committee, the Trustee, the Company, the Employer, nor
any fiduciary under the Plan shall be responsible for any late or lost payment of a benefit or for
failure of any notice to be provided timely under the terms of the Plan.

18.8 Incorrect Information, Fraud, Concealment, or Error. Any contrary provisions of
the Plan notwithstanding, if, because of a human or systems error, or because of incorrect
information provided by or correct information failed to be provided by, fraud, misrepresentation,
or concealment of any relevant fact (as determined by the Committee) by any person the Plan enrolls
any individual, pays benefits under the Plan, incurs a liability or makes any overpayment or
erroneous payment, the Plan shall be entitled to recover from such person the benefit paid or the
liability incurred, together with all expenses incidental to or necessary for such recovery.

18.9 Severability. If any provision of this Plan shall be held illegal or invalid for
any reason, said illegality or invalidity shall not affect the remaining provisions hereof. In
such case, each provision shall be fully severable and the Plan shall be construed and enforced as
if said illegal or invalid provision had never been included herein.

18.10 Jurisdiction. The situs of the Plan hereby created is Texas. All provisions of
the Plan shall be construed in accordance with the laws of Texas except to the extent preempted by
federal law.

EXECUTED this 18th day of December, 2008, effective January 1, 2009, or as
otherwise provided herein.

	 	 	 	 	 
	 	 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

 

61

 

Appendix A:

PARTICIPATING EMPLOYERS

1. Dynegy Midwest Generation, Inc.

 

1

 

Appendix B:

LOAN POLICY

B-1 Eligibility for Loan. Upon application by (i) any Participant who is an Employee, or
(ii) any Participant (A) who is a party-in-interest, as that term is defined in Section 3(14) of
the Act, as to the Plan, (B) who is no longer employed by the Employer, who is a beneficiary of a
deceased Participant, or who is an alternate payee under a qualified domestic relations order, as
that term is defined in Section 414(p)(8) of the Code, and (C) who retains an Account balance under
the Plan (an individual who is eligible to apply for a loan under this Article being hereinafter
referred to as a “Participant” for purposes of this Appendix B) and subject to such uniform and
nondiscriminatory rules and regulations as the Committee may establish, the Committee may in its
discretion direct the Trustee to make a loan or loans to such Participant. No individual may have
more than three (3) loans outstanding under the Plan at any time, and no individual may have more
than one loan outstanding under the Plan at any time that is being used to acquire any dwelling
unit which within a reasonable time is to be used (determined at the time the loan is made) as a
principal residence.

B-2 Maximum Loan.

(a) A loan to a Participant may not exceed fifty-percent (50%) of the sum of the then value of
such Participant’s Accounts as reduced by the sum of then value of the portion of each of such
Accounts invested in the VBO.

(b) Paragraph (a) above to the contrary notwithstanding, no loan shall be made from the Plan
to the extent that such loan would cause the total of all loans made to a Participant from all
qualified plans of an Employer or a Controlled Entity, including loans deemed distributed in
accordance with regulations promulgated under Section 72(p) of the Code, and the interest accruing
thereafter, that has not been repaid (‘Outstanding Loans’) to exceed the lesser of:

(1) $50,000 (reduced by the excess, if any, of (i) the highest outstanding balance of
Outstanding Loans during the one-year period ending on the day before the date on which the
loan is to be made, over (ii) the outstanding balance of Outstanding Loans on the date on
which the loan is to be made); or

(2) One-half the present value of the Participant’s nonforfeitable accrued benefit
under all qualified plans of the Employer or a Controlled Entity.

B-3 Minimum Loan. A loan to a Participant may not be for an amount less than $500.00.

B-4 Interest and Security.

(a) Any loan made pursuant to this Appendix B shall bear interest at a rate established by the
Committee from time to time and communicated to the Participants, which rate shall provide the Plan
with a return commensurate with the interest rates charged by persons in the business of lending
money for loans which would be made under similar circumstances.

 

1

 

(b) Any loan shall be made as an investment of a segregated loan fund to be established in the
Trust Fund for the Participant to whom the loan is made. Any loan shall be considered to come,
first, from the Participant’s After-Tax Account, second, from the Employee After-Tax Rollover
Subaccount of his Rollover Contribution Account, third, from the Employee Rollover Subaccount of
his Rollover Contribution Account, fourth, from his Class Settlement Account, fifth, from the
remainder of his Accounts on a pro rata basis. The Trustee shall fund a Participant’s segregated
loan fund by liquidating such portion of the assets of the Accounts from which the Participant’s
loan is to be made as is necessary to fund the loan and transferring the proceeds to such
segregated loan fund. If such Accounts are invested in more than one Investment Fund, the transfer
shall be made pro rata from each such Investment Fund (other than the VBO).

Notwithstanding the foregoing, in the event that a loan from the Plan is deemed distributed to a
Participant and has not been repaid by the Participant, and the Participant applies for another
loan from the Plan, then the new loan shall satisfy such additional conditions as may be required
in accordance with Section 72(p) of the Code and the Treasury Regulations promulgated thereunder.
The loan shall be secured by a pledge of the Participant’s segregated loan fund. Notwithstanding
any foregoing provision of this Paragraph to the contrary, no loan shall be considered to come
from, and no liquidation shall be made with respect to, the portion of a Participant’s Accounts
that are invested in the VBO.

(c) The actual and reasonable expenses incurred by the Plan (including attorneys’ fees) in
connection with the documentation of a loan, the recording of security interests, the enforcement
of the terms of the loan, and collection activities associated with any default may be charged to
the borrowing Participant’s Accounts pursuant to uniform and nondiscriminatory policies established
by the Committee from time to time.

B-5 Repayment Terms of Loan.

(a) A Participant who is an Employee receiving compensation at the time of receipt of a loan
shall be required, as a condition to receiving a loan, to enter into an irrevocable agreement
authorizing the Employer to make payroll deductions from his compensation so long as the
Participant is such an Employee and to transfer such payroll deduction amounts to the Trustee in
payment of such loan plus interest. In the case of a Participant who (i) is not at the time of
commencement of his loan an Employee, or (ii) is not at the commencement of his loan receiving
compensation, or (iii) was an Employee receiving compensation at the time of commencement of his
loan but ceases to receive compensation or ceases to be an Employee, such Participant shall make
his loan repayments in the manner prescribed by the Committee.

(b) The terms of the loan shall (i) require level amortization with payments not less
frequently than quarterly, (ii) require that the loan be repaid within five (5) years unless the
Participant certifies in writing to the Committee that the loan is to be used to acquire any
dwelling unit which within a reasonable time is to be used (determined at the time the loan is
made) as a principal residence of the Participant, in which case such loan shall be repaid within
ten years, (iii) allow prepayment without penalty, provided that any prepayment must be for the
full outstanding loan balance (including interest), (iv) require that the balance of the loan
(including interest) shall become due and payable (to the extent not otherwise due and payable)
on the date the Participant or, if applicable, the Participant’s beneficiary, becomes entitled to
receive a distribution pursuant to Article VII or VIII, irrespective of whether such Participant or
beneficiary elects or consents to such distribution, and (v) provide that such Participant’s
outstanding loan balance (including interest), if not paid in accordance with the repayment
provisions of the loan, shall be repaid by offsetting such balance against the amount in the
Participant’s segregated loan fund pledged as security for the loan. Notwithstanding the
foregoing, in the event that a Participant becomes entitled to, but has not yet received, a
distribution pursuant to Article VII of the Plan, such Participant may elect to continue to make
payments of principal and interest on his loan in accordance with the terms thereof and subject to
the provisions of this Appendix B. By agreeing to the pledge of the segregated loan fund as
security for the loan, a Participant shall be deemed to have consented to the distribution of such
segregated loan fund prior to the time specified in Section 411(a)(11) of the Code and the
applicable Treasury Regulations thereunder.

 

2

 

Notwithstanding any other provision of the Plan to the contrary, if the distribution of the
balance of the Participant’s Accounts is made in connection with the sale of the stock or the
assets of an Employer, the Participant’s entire loan may be distributed solely as a Direct
Rollover, in accordance with the Article IX of the Plan, to a trust for a plan qualified under
Section 401(a) of the Code, maintained by the purchaser, provided such trust will accept the
Participant’s loan as an investment. The Committee shall determine, in its discretion, whether or
not a Direct Rollover is in connection with a sale of the stock or assets of an Employer.

(c) If the Participant fails in any way to comply with the repayment terms of a loan, such
loan shall be repaid by offsetting the Participant’s outstanding loan balance (including interest)
against the amount in the Participant’s segregated loan fund pledged as security for the loan. Any
such outstanding loan (including interest) shall be so offset and repaid on the earlier of (i) the
last day of the “Grace Period” (as hereinafter defined) applicable with respect to such failure to
comply, or (ii) the date of any withdrawal or distribution of benefits from the pledged portion of
the Participant’s Accounts pursuant to the provisions of the Plan. Notwithstanding the foregoing,
amounts in a Participant’s Accounts may not be offset and used to satisfy the payment of such loan
(including interest) prior to the earliest time such amounts would otherwise be permitted to be
distributed under applicable law. For purposes of this Paragraph, the “Grace Period” with respect
to any failure to comply with the repayment terms of a loan shall be the period beginning on the
date of such failure and ending on the last day of the calendar quarter following the calendar
quarter in which such failure occurred.

(d) Amounts tendered to the Trustee by a Participant in repayment of a loan made pursuant to
this Appendix B, (i) shall initially be credited to the Participant’s segregated loan fund,
(ii) then shall be transferred as soon as practicable following receipt thereof to the Account or
Accounts from which the Participant’s loan was made, and (iii) shall be invested in accordance with
the Participant’s current designation as to the investment of amounts allocated to his Accounts
pursuant to Article V of the Plan, except that any portion of such amounts that is credited to such
Participant’s ESOP Subaccount shall be invested in accordance with Article VI of the Plan.

B-6 Operation of Article. The provisions of this Appendix B shall be applicable to loans
granted or renewed on or after the Effective Date. Loans granted or renewed prior to the
Effective Date shall be governed by the provisions of the Plan as in effect prior to the Effective
Date.

 

3Filed by Bowne Pure Compliance

Exhibit 10.40

SITHE STABLE PENSION ACCOUNT PLAN

(AMENDED AND RESTATED AS OF JANUARY 1, 2007)

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	PREAMBLE
	 	 	1	 
	 
	 	 	 	 
	ARTICLE 1 DEFINITIONS
	 	 	3	 
	 
	 	 	 	 
	1.1 Accrued Benefit
	 	 	3	 
	1.2 Actuarial Equivalent or Actuarial Equivalence
	 	 	3	 
	1.3 Affiliated Company or Affiliate
	 	 	4	 
	1.4 Applicable Interest Rate
	 	 	4	 
	1.5 Authorized Leave of Absence
	 	 	4	 
	1.6 Beneficiary
	 	 	4	 
	1.7 Board or Board of Directors
	 	 	4	 
	1.8 Cash Balance Account
	 	 	4	 
	1.9 Code
	 	 	5	 
	1.10 Company
	 	 	5	 
	1.11 Compensation
	 	 	5	 
	1.12 Disability
	 	 	6	 
	1.13 Effective Date
	 	 	6	 
	1.14 Eligible Employee
	 	 	6	 
	1.15 Employee
	 	 	6	 
	1.16 Employment Date
	 	 	6	 
	1.17 Enrolled Actuary
	 	 	6	 
	1.18 ERISA
	 	 	6	 
	1.19 Fiduciary
	 	 	6	 
	1.20 Fund
	 	 	6	 
	1.21 Hour of Service
	 	 	7	 
	1.21A Insurance Company
	 	 	7	 
	1.22 Interest Credit(s)
	 	 	8	 
	1.23 Member
	 	 	8	 
	1.24 Non-Appendix B Member
	 	 	8	 
	1.25 Normal Retirement Date
	 	 	8	 
	1.26 Opening Balance
	 	 	8	 
	1.27 Parental Absence
	 	 	8	 
	1.28 Participating Company
	 	 	8	 
	1.29 Pay Credit
	 	 	8	 
	1.30 Payment Date
	 	 	8	 
	1.31 Plan
	 	 	9	 
	1.32 Plan A
	 	 	9	 
	1.33 Plan B
	 	 	9	 
	1.34 Plan Administrator
	 	 	9	 
	1.35 Plan Year
	 	 	9	 
	1.36 Reemployment or Reemployment Date
	 	 	9	 
	1.37 Retirement Benefit
	 	 	9	 

 

i

 

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	1.38 Spouse
	 	 	9	 
	1.39 Termination Date
	 	 	9	 
	1.40 Trust
	 	 	9	 
	1.41 Trust Agreement
	 	 	10	 
	1.42 Trustee
	 	 	10	 
	1.43 Union Member
	 	 	10	 
	 
	 	 	 	 
	ARTICLE 2 PARTICIPATION AND SERVICE
	 	 	10	 
	 
	 	 	 	 
	2.1 Eligibility Requirements
	 	 	10	 
	2.2 Special One-Time Election
	 	 	10	 
	2.3 Service
	 	 	11	 
	 
	 	 	 	 
	ARTICLE 3 CASH BALANCE ACCOUNT
	 	 	12	 
	 
	 	 	 	 
	3.1 In General
	 	 	12	 
	3.2 Opening Balance
	 	 	12	 
	3.3 Pay Credits
	 	 	12	 
	3.4 Interest Credits
	 	 	13	 
	3.5 Cash Balance Account
	 	 	13	 
	3.6 Reemployment of Members
	 	 	13	 
	 
	 	 	 	 
	ARTICLE 4 PAYMENTS
	 	 	14	 
	 
	 	 	 	 
	4.1 Payment Dates
	 	 	14	 
	4.2 Forms of Payment
	 	 	15	 
	4.3 Election Procedures
	 	 	17	 
	4.4 Effect of Death on Forms of Payment
	 	 	22	 
	4.5 Payment on Member’s Behalf
	 	 	22	 
	4.6 Unclaimed Benefits
	 	 	23	 
	4.7 Maximum Benefit Limitation
	 	 	23	 
	4.8 Minimum Distribution Requirements
	 	 	24	 
	 
	 	 	 	 
	ARTICLE 5 PRE-DISTRIBUTION DEATH BENEFITS
	 	 	29	 
	 
	 	 	 	 
	5.1 General Provisions
	 	 	29	 
	5.2 Payment
	 	 	29	 
	 
	 	 	 	 
	ARTICLE 6 DISABILITY
	 	 	30	 
	 
	 	 	 	 
	6.1 Disability
	 	 	30	 
	6.2 Disability Election
	 	 	30	 
	6.3 Cessation 
	 	 	30	 

 

ii

 

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	ARTICLE 7 VESTING
	 	 	30	 
	 
	 	 	 	 
	ARTICLE 8 BENEFICIARIES
	 	 	31	 
	 
	 	 	 	 
	8.1 Beneficiary Designation
	 	 	31	 
	8.2 Death of Beneficiary
	 	 	31	 
	 
	 	 	 	 
	ARTICLE 9 FUNDING AND CONTRIBUTIONS
	 	 	31	 
	 
	 	 	 	 
	9.1 Establishment of the Funds
	 	 	31	 
	9.2 Company Contributions
	 	 	31	 
	9.3 Return of Company Contributions
	 	 	32	 
	9.4 Forfeitures and Other Gains
	 	 	32	 
	9.5 Expenses
	 	 	32	 
	9.6 Actuarial Valuations
	 	 	32	 
	 
	 	 	 	 
	ARTICLE 10 ADMINISTRATION
	 	 	33	 
	 
	 	 	 	 
	10.1 Delineation of Fiduciary Responsibilities
	 	 	33	 
	10.2 Appointment of the Members of the Administrative Committee
	 	 	34	 
	10.3 Organization and Operation of the Administrative Committee
	 	 	34	 
	10.4 Powers and Duties of the Plan Administrator
	 	 	35	 
	10.5 Accounts and Records
	 	 	35	 
	10.6 Employment of Specialists
	 	 	36	 
	10.7 Claims and Review Procedures
	 	 	36	 
	10.8 Standard of Conduct
	 	 	37	 
	10.9 Indemnification
	 	 	37	 
	10.10 Compensation of Administrative Committee Members
	 	 	37	 
	10.11 Actions to be Uniform
	 	 	37	 
	10.12 Effect of Interpretation or Determination
	 	 	37	 
	10.13 Withholding of Tax
	 	 	37	 
	 
	 	 	 	 
	ARTICLE 11 AMENDMENT AND TERMINATION
	 	 	38	 
	 
	 	 	 	 
	11.1 Right to Amend
	 	 	38	 
	11.2 Right to Terminate
	 	 	38	 
	11.3 Amendments or Termination Affecting Union Members
	 	 	38	 
	11.4 Nonforfeitable Benefits
	 	 	38	 
	11.5 Satisfaction of Liabilities
	 	 	39	 
	 
	 	 	 	 
	ARTICLE 12 GENERAL PROVISIONS
	 	 	39	 
	 
	 	 	 	 
	12.1 Rights to Benefits
	 	 	39	 
	12.2 Company Rights
	 	 	39	 
	12.3 Construction
	 	 	39	 
	12.4 Titles
	 	 	40	 

 

iii

 

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	12.5 Impossibility of Action
	 	 	40	 
	12.6 Separability
	 	 	40	 
	12.7 Merger or Consolidation of Plan
	 	 	40	 
	12.8 Latest Commencement of Benefits
	 	 	40	 
	12.9 Veterans’ Reemployment Rights
	 	 	41	 
	12.10 Separate Plans and Assets
	 	 	41	 
	 
	 	 	 	 
	ARTICLE 13 TOP HEAVY
	 	 	41	 
	 
	 	 	 	 
	13.1 Purpose and Applicability
	 	 	41	 
	13.2 Special Vesting
	 	 	42	 
	13.3 Minimum Benefits
	 	 	42	 
	13.4 Definitions
	 	 	43	 
	13.5 Adjustment to Benefit Limitations
	 	 	45	 
	 
	 	 	 	 
	APPENDIX A SPECIAL PROVISIONS FOR FORMER GPU REPRESENTED
EMPLOYEES
	 	 	46	 
	 
	 	 	 	 
	ARTICLE A1 PURPOSE AND APPLICABILITY
	 	 	46	 
	 
	 	 	 	 
	A1.1 Purpose and Applicability
	 	 	46	 
	A1.2 Participating Company
	 	 	47	 
	A1.3 Plan Assets
	 	 	47	 
	 
	 	 	 	 
	ARTICLE A2 JERSEY PLAN COVERED GROUP PROVISIONS
	 	 	47	 
	 
	 	 	 	 
	A2.1 Jersey Plan Eligible Employee
	 	 	47	 
	A2.2 Creditable Service
	 	 	47	 
	A2.3 Vesting Service
	 	 	48	 
	A2.4 Creditable Service for Determination of Basic Annuity
	 	 	48	 
	A2.5 Service for All Other Purposes
	 	 	48	 
	A2.6 Basic Earnings
	 	 	48	 
	A2.7 Inapplicable Jersey Plan Provisions
	 	 	48	 
	 
	 	 	 	 
	ARTICLE A3 METROPOLITAN PLAN COVERED GROUP PROVISIONS
	 	 	49	 
	 
	 	 	 	 
	A3.1 Metropolitan Plan Eligible Employee
	 	 	49	 
	A3.2 Creditable Service
	 	 	49	 
	A3.3 Vesting Service
	 	 	49	 
	A3.4 Creditable Service for Determination of Basic Annuity
	 	 	50	 
	A3.5 Service for All Other Purposes
	 	 	50	 
	A3.6 Basic Earnings 
	 	 	50	 
	A3.7 Inapplicable Metropolitan Plan Provisions
	 	 	50	 

 

iv

 

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	ARTICLE A4 PENELEC PLAN COVERED GROUP PROVISIONS
	 	 	51	 
	 
	 	 	 	 
	A4.1 Penelec Plan Eligible Employee
	 	 	51	 
	A4.2 Creditable Service
	 	 	51	 
	A4.3 Vesting Service
	 	 	51	 
	A4.4 Creditable Service for Determination of Basic Annuity
	 	 	52	 
	A4.5 Service for All Other Purposes
	 	 	52	 
	A4.6 Basic Earnings
	 	 	52	 
	A4.7 Inapplicable Penelec Plan Provisions
	 	 	52	 
	 
	 	 	 	 
	APPENDIX B MODIFIED TRADITIONAL PENSION PLAN FOR CERTAIN UNION
MEMBERS
	 	 	53	 
	 
	 	 	 	 
	ARTICLE B1 INTRODUCTION
	 	 	53	 
	 
	 	 	 	 
	ARTICLE B2 DEFINITIONS OTHER THAN SERVICE DEFINITIONS
	 	 	54	 
	 
	 	 	 	 
	B2.1 Accumulated Member Contributions
	 	 	54	 
	B2.2 Accrued Benefit
	 	 	54	 
	B2.3 Actuarial Equivalent
	 	 	55	 
	B2.4 Annuity Starting Date
	 	 	55	 
	B2.5 Base Pay
	 	 	55	 
	B2.6 BECO Retirement Plan
	 	 	56	 
	B2.7 Beneficiary
	 	 	56	 
	B2.8 Contingent Annuitant
	 	 	56	 
	B2.9 Effective Date
	 	 	56	 
	B2.10 Eligible Employee
	 	 	56	 
	B2.11 Employee
	 	 	56	 
	B2.12 Final Average Pay
	 	 	57	 
	B2.13 Lump-sum Equivalent
	 	 	57	 
	B2.14 Member
	 	 	57	 
	B2.15 Plan
	 	 	57	 
	B2.16 Plan Year
	 	 	57	 
	B2.17 Retirement Date
	 	 	57	 
	B2.18 Surviving Spouse
	 	 	57	 
	 
	 	 	 	 
	ARTICLE B3 SERVICE DEFINITIONS
	 	 	58	 
	 
	 	 	 	 
	B3.1 Employment Commencement Date
	 	 	58	 
	B3.2 Break in Service
	 	 	58	 
	B3.3 Substantial Break
	 	 	58	 
	B3.4 Year of Eligibility Service
	 	 	59	 
	B3.5 Year of Vesting Service
	 	 	59	 
	B3.6 Years of Benefit Service
	 	 	60	 
	B3.7 Fully Vested
	 	 	60	 
	B3.8 Service Bridging
	 	 	60	 

 

v

 

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	ARTICLE B4 ELIGIBILITY FOR MEMBERSHIP
	 	 	60	 
	 
	 	 	 	 
	B4.1 Eligibility
	 	 	60	 
	B4.2 Membership Following a Break in Service
	 	 	60	 
	 
	 	 	 	 
	ARTICLE B5 CONTRIBUTIONS TO THE FUND
	 	 	61	 
	 
	 	 	 	 
	B5.1 Continuation of Member Contributions
	 	 	61	 
	B5.2 Withdrawal of Accumulated Member Contributions
	 	 	61	 
	B5.3 Forfeitures and Other Gains
	 	 	62	 
	 
	 	 	 	 
	ARTICLE B6 RETIREMENT DATES
	 	 	62	 
	 
	 	 	 	 
	B6.1 Normal Retirement Date
	 	 	62	 
	B6.2 Early Retirement Date
	 	 	62	 
	B6.3 Disability Retirement Date
	 	 	63	 
	B6.4 Late Retirement Date
	 	 	63	 
	 
	 	 	 	 
	ARTICLE B7 NORMAL FORM AND AMOUNT OF RETIREMENT BENEFITS
	 	 	64	 
	 
	 	 	 	 
	B7.1 Formula Retirement Benefit
	 	 	64	 
	B7.2 Normal Form of Retirement Benefit for Single Members
	 	 	66	 
	B7.3 Normal Form of Retirement Benefit for Married Members
	 	 	66	 
	B7.4 Normal or Late Retirement Benefit
	 	 	66	 
	B7.5 Deferred Early Retirement Benefit
	 	 	66	 
	B7.6 Reduced Early Retirement Benefit
	 	 	66	 
	B7.7 Temporary Supplemental Benefit for Certain Early Retirees
	 	 	68	 
	B7.8 Disability Retirement Benefit
	 	 	68	 
	B7.9 Retirement Benefit After Reemployment Following a Break in Service
	 	 	68	 
	 
	 	 	 	 
	ARTICLE B8 OPTIONAL FORMS OF RETIREMENT BENEFIT
	 	 	69	 
	 
	 	 	 	 
	B8.1 Options and Elections
	 	 	69	 
	B8.2 Amount of Retirement Benefit
	 	 	71	 
	 
	 	 	 	 
	ARTICLE B9 DEATH PRIOR TO ANNUITY STARTING DATE
	 	 	72	 
	 
	 	 	 	 
	B9.1 Preretirement Surviving Spouse Benefit
	 	 	72	 
	B9.2 Return of Accumulated Member Contributions
	 	 	73	 
	B9.3 Termination of Membership
	 	 	74	 

 

vi

 

	 	 	 	 	 
	 	 	PAGE	 
	 
	 	 	 	 
	ARTICLE B10 DEATH ON OR AFTER ANNUITY STARTING DATE
	 	 	74	 
	 
	 	 	 	 
	B10.1 No Optional Form of Retirement Benefit in Effect
	 	 	74	 
	B10.2 Optional or Normal Form of Retirement Benefit For Married Member in Effect
	 	 	74	 
	B10.3 Termination of Membership
	 	 	74	 
	 
	 	 	 	 
	ARTICLE B11 VESTING
	 	 	75	 
	 
	 	 	 	 
	B11.1 Deferred Vested Retirement Benefit
	 	 	75	 
	B11.2 Reduced Earlier Vested Retirement Benefit
	 	 	75	 
	B11.3 No Reduction of Vesting
	 	 	76	 
	B11.4 Withdrawal of Accumulated Member Contributions by Vested Member
	 	 	76	 

 

vii

 

PREAMBLE

This Sithe Stable Pension Account Plan document is hereby amended and restated effective January
1, 2007, to incorporate the provisions of the Plan, as last amended and restated effective January
1, 2000, and as thereafter amended by the First, Second, Third, Fourth, Fifth and Sixth Amendments to the Plan.

The Plan, as last amended and restated effective January 1, 2000, consisted of two separate
tax-qualified defined benefit pension plans for the eligible employees of Sithe Energies, Inc.,
Sithe New England Power Services, Inc. and any Affiliated Company that has adopted one or both of
these plans.

The first plan described in this document is the Sithe Stable Pension Account Plan, which has been
established by Sithe Energies, Inc. to provide a cash balance pension benefit for the benefit of
its eligible employees who are not represented by a collective bargaining agreement, effective
January 1, 2000. All of the assets attributable to providing this cash balance pension benefit for
the non-union eligible employees are called Plan A.

Plan A was amended by the Second Amendment to reflect certain provisions of EGTRRA. The Second
Amendment was intended as good faith compliance with the requirements of EGTRRA and was to be
construed in accordance with EGTRRA and guidance issued thereunder. Except as otherwise provided,
the Second Amendment was effective as of the first day of the Plan Year beginning after December
31, 2001. The Second Amendment superseded the provisions of Plan A to the extent those provisions
were inconsistent with the provisions of EGTRRA. The provisions of the Second Amendment are
incorporated in this amended and restated Plan document.

The second plan described in this document is the Sithe Union Employees Pension Plan, which has
been established and maintained by Sithe New England Power Services, Inc. for the benefit of its
eligible employees whose employment is governed by a collective bargaining agreement with Local 369
of the Utility Workers Union of America, AFL-CIO (the “Union Members”). It consists of two parts.
One part provides for a modified traditional defined benefit pension plan (the provisions of which
are described at Appendix B of this document) and, effective January 1, 2001, the second part
provides for a cash balance pension benefit that is identical to that described under the Sithe
Stable Pension Account Plan for non-union employees. Both parts together are a continuation of the
Sithe Energies Group Pension Plan, previously known as the Sithe New England Power Services, Inc.
Union Pension Plan, originally effective May 16, 1998. All of the assets attributable to providing
the Union Members both the modified traditional pension benefit and the cash balance pension
benefit are collectively called Plan B.

 

1

 

Effective October 31, 2002, Exelon acquired all of the stock of Sithe New England Power Services,
Inc., the sponsor of Plan B, as well as all corresponding assets and liabilities of Plan B. As a
result of such stock acquisition, Exelon has adopted a new document for Plan B, separate and apart
from the Plan. Therefore, effective November 1, 2002, Plan B provisions were deleted from this
Plan document, and neither Sithe Energies, Inc. nor any member of its control group shall be
liable for any benefits relating to former employees or beneficiaries covered under Plan B. The
provisions of Plan B and of Appendix B to the Plan document are included in this amended and
restated Plan document solely for purposes of historical reference.

The terms and conditions of Plan A and Plan B (collectively, the “Plans”) are set forth in the
body of this document. Although the provisions of each of the Plans are described in this single
document, they were separate and distinct qualified retirement plans. The assets of each of the
Plans could be used solely to provide benefits for the covered employees and beneficiaries of that
single Plan. Additionally, all of the assets of each Plan shall be at all times accounted for
separately from all of the assets of the other Plan in a manner that satisfies Treas. Reg. Sec.
1.414(l)-1(b)(8). Plan A is intended to be qualified under section 401(a) of the Internal Revenue
Code of 1986, as amended (the “Code”). Plan B was intended to be qualified under section 401(a)
of the Code.

Appendix A to this document is included in this amended and restated Plan document solely for
historical purposes. Amendment A describes benefits that were provided between November 24, 1999
and May 12, 2000 to certain former union employees. In connection with the sale of certain
operating companies to an unrelated employer, these benefits and related assets were transferred
to a separate defined benefit pension plan maintained by that unrelated employer in accordance
with section 414(I) of the Code.

The provisions of this Plan document shall apply only to a Member who terminated employment with
Sithe Energies, Inc., Sithe New England Power Services, Inc. and all Affiliated Companies on or
after January 1, 2000. Except as otherwise specifically and expressly provided herein, a former
Employee’s eligibility for and the amount of benefits, if any, payable to or on behalf of such
former Employee, shall be determined in accordance with the provisions of the Plan in effect on
his termination of employment date. The benefit payable to or on behalf of a Member included under
the Plan in accordance with the following provisions shall not be affected by the terms of any
amendment to the Plan adopted after such Participant’s employment terminates, unless the amendment
expressly provides otherwise.

 

2

 

ARTICLE 1

DEFINITIONS

The following words and phrases when used in the Plan shall have the meanings indicated in this
Article 1 unless a different meaning is plainly required by the context or by Appendix A or
Appendix B:

	1.1	 	“Accrued Benefit” means the value of a Member’s Cash Balance Account as of any
determination date with actual Interest Credits thereon until Normal Retirement
Date and payable as a single lump sum on such Member’s Normal Retirement Date. If a Member
continues as an Eligible Employee after Normal Retirement Date, the Accrued Benefit is equal
to the value of the Cash Balance Account immediately payable in a single lump sum. A
Member’s Accrued Benefit shall never be less valuable than it was on December 31, 2000 under
the terms of Plan B in effect on such date. Notwithstanding anything to the contrary in
this Section 1.1, for purposes of determining a Member’s Accrued Benefit, such Member’s
Accrued Benefit shall be determined immediately prior to the closing (the “Closing”) of the
transactions contemplated by that certain Stock Purchase Agreement dated as of November 1,
2004, by and among Exelon SHC, Inc., Exelon New England Power Marketing, L.P., ExRes SHC,
Inc., and Dynegy New York Holdings, Inc. A Member shall not be credited with any additional
Pay Credits under Section 3.3 (or Section 6.1) on or after the Closing and shall only be
credited with Interest Credits under Section 3.4 until the Payment Date of such Member’s
Accrued Benefit.

	1.2	 	“Actuarial Equivalent” or “Actuarial Equivalence” means a benefit of
equivalent value to another benefit, determined on the following bases:

	 	(a)	 	for conversion of a single life annuity to an optional annuity form of payment
under Section 4.2, the following:

	 	(i)	 	Interest: 7.0% per year

	 	(ii)	 	Mortality: 1983 Unisex Group Annuity Mortality Table

	 	(b)	 	for conversion of a Member’s Cash Balance Account to a single life annuity
under Section 4.2: the mortality table specified from time to time under Code
Section 417(e)(3), or regulations thereunder, and the Applicable Interest
Rate described in Section 1.4.

	 	(c)	 	For purposes of determining a Union Member’s Opening Balance under Section 3.2,
the interest rate specified under Code Section 417(e)(3) as in effect for March, 2000
and the mortality table specified under Code Section 417(e)(3).

	 	(d)	 	for all other purposes, mortality and interest as shown in (b) above.

This paragraph shall apply to distributions with Payment Dates on or after December 31,
2002. Notwithstanding any other provisions to the contrary, the applicable mortality table
used for adjusting any benefit or limitation under Code Section 415(b)(2)(B), (C), or (D)
as referenced in Section 4.7 of the Plan and the applicable mortality table used for the
purposes of satisfying the requirements of
Code Section 417(e) as set forth in this Section 1.2 is the table prescribed in Internal
Revenue Service Revenue Ruling 2001-62.

 

3

 

	1.3	 	“Affiliated
Company” or “Affiliate” means (a) any corporation (other than the
Company) that is a member of a controlled group of corporations (as defined in section 414(b)
of the Code) with the Company, (b) any trade or business (other than the Company), whether or
not incorporated, that is under common control (as defined in section 414(c) of the Code) with
the Company, and (c) any organization (other than the Company) that is a member of an
affiliated service group (as defined in section 414(m) of the Code) of which the Company is
also a member or that is otherwise required to be aggregated with the Company under the
regulations under section 414(o) of the Code. Notwithstanding the foregoing, the term
“Affiliated Company” shall not include any such corporation, trade or business, or
organization prior to the date on which such corporation, trade or business, or organization
satisfies the affiliation tests of (a), (b), or (c) above. Solely for purposes of Section 4.7
of the Plan, section 414(b) and section 414(c) of the Code will be considered modified by
section 415(h) of the Code.

	1.4	 	“Applicable Interest Rate” means the interest rate specified under Code Section
417(e)(3) as in effect for the November preceding the start of the Plan Year in which the
payment is made. In the case of payments that commence in calendar year 2000, such rate will
be the rate in effect for November 1999.

	1.5	 	“Authorized Leave of Absence” means any absence authorized by the
Participating Company under its standard personnel practices, provided that all persons under
similar circumstances are treated alike in the granting of such Authorized Leave of Absence,
and provided further that the Member returns or retires within the period specified in the
Authorized Leave of Absence. An absence due to service in the Armed Forces of the United
States shall be considered an Authorized Leave of Absence provided that the Employee
complies with all of the requirements of Federal law in order to be entitled to reemployment
and provided further that the Employee returns to employment with the Company or an Affiliated
Company within the period provided by such law.

	1.6	 	“Beneficiary” means the person or persons entitled under Article 9 to receive any benefit
payable hereunder on or after the Member’s death, other than any benefit payable to a Spouse
pursuant to Section 4.2(a) or to a surviving Spouse pursuant to Section 5.1.

	1.7	 	“Board” or “Board of Directors” means the Board of Directors of the Company.

	1.8	 	“Cash Balance Account” means the notional account described in Section 3.1 and
maintained for each Member pursuant to Section 3.5.

 

4

 

	1.9	 	“Code” means the Internal Revenue Code of 1986, as amended from time to time. Reference to
any section or subsection of the Code includes reference to any comparable or succeeding
provisions of any legislation which amends, supplements or replaces such section or
subsection.

	1.10	 	“Company”

	 	(a)	 	For purposes of applying this document (including Appendix B) to Union Members
who participate in Plan B, “Company” means Sithe New England Power Services,
Inc.; and

	 	(b)	 	For purposes of applying this document to all Members not covered by subsection
(a) above and who participate in Plan A, “Company” means Sithe Energies, Inc.

	1.11	 	“Compensation” means the base wages received by a Member by a Participating Company
in a calendar quarter and all base wage pre-tax contributions for such calendar quarter made
at the Member’s voluntary election to a qualified cash or deferred arrangement as defined in
Code Section 401(k), a cafeteria plan meeting the requirements of Code Section 125, or any
other salary reduction program authorized under the Code and sponsored by a Participating
Company.

Notwithstanding the foregoing, Compensation shall not include any of the following:

	 	(a)	 	any amount in excess of $200,000, as adjusted for cost-of-living increases in
accordance with Code Section 401(a)(17)(B). The cost-of-living adjustment
in effect for a calendar year applies to annual Compensation for the Plan Year that
begins with such calendar year.

	 	(b)	 	overtime pay, bonuses, and commission;

	 	(c)	 	the value of any stock options;

	 
	 	(d)	 	severance pay of any kind;

	 	(e)	 	any form of special pay other than what is specifically described above; and

	 	(f)	 	any long term disability (LTD) payments made directly by a Participating
Company or under a plan sponsored by such employer.

	 	 	For purposes of determining a Member’s Compensation for the calendar quarter beginning on
January 1, 2005, only such Member’s Compensation received for the period beginning on and
after January 1, 2005 and ending immediately prior to the Closing shall be taken into
account. A Member’s Compensation for any period beginning on or after the Closing shall be disregarded for purposes of this Section
1.11.

 

5

 

	1.12	 	“Disability” means a physical or mental incapacity that actually entitles a Member to
benefits under the group long-term disability (LTD) plan sponsored by a Participating Company.

	1.13	 	“Effective Date” means January 1, 2007, except as otherwise specified herein or as required by law.

	1.14	 	“Eligible Employee” means an Employee who meets the eligibility requirements of
Article 2.

	1.15	 	“Employee” means an employee of the Company or an Affiliated Company. However, the term does
not include any person whose services are performed pursuant to a contract with such person
that purports to treat the individual as an independent contractor even if such individual is
later determined (by judicial action or otherwise) to have been a common law employee of the
Company or an Affiliated Company rather than an independent contractor.

	1.16	 	“Employment Date” means shall mean the first day on which an Employee is credited
with an Hour of Service.

	1.17	 	“Enrolled Actuary” means an individual or firm of actuaries, who shall be
independent of the Company, selected from time to time by the Plan
Administrator, who meets the standards and qualifications established by the Joint Board for
the Enrollment of Actuaries, or a firm of actuaries which has on staff such individual
actuary, to perform all necessary actuarial services in connection with the operation of the
Plan.

	1.18	 	“ERISA” means the Employee Retirement Income Security Act of 1974, as the same may be amended
from time to time, and as interpreted by the regulations, rulings and cases promulgated or
decided thereunder.

	1.19	 	“Fiduciary” means any person who exercises any discretionary authority or discretionary
control respecting the management of the Plan, assets held under the Plan, or disposition of
Plan assets; who renders investment advice for a fee or other compensation, direct or
indirect, with respect to assets held under the Plan or has any authority or responsibility to
do so; or who has any discretionary authority or discretionary responsibility in the
administration of the Plan. Any person who exercises authority or has responsibility of a
fiduciary nature as described above shall be considered a Fiduciary under the Plan.

	1.20	 	“Fund” means the cash and other investments of the Plan, and income attributable
thereto, held and administered by the Trustee(s) in accordance with the Trust Agreement(s) and/or by the Insurance Company in accordance with any group annuity
contracts.

 

6

 

	1.21	 	“Hour of Service” means:

	 	(a)	 	each hour for which an individual is directly or indirectly paid, or entitled
to payment, by the Company or an Affiliate for the performance of duties during a
computation period, such hours to be credited to him for the computation period or
period in which the duties are performed;

	 	(b)	 	each hour for which back pay, irrespective of mitigation of damages, has been either
awarded or agreed to by the Company or an Affiliate, with such hours to be credited to the
individual 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. The
same Hours of Service shall not be credited both under paragraphs (a) or (c) of this
Section, as the case may be, and under this paragraph (b); and

	 	(c)	 	each hour for which the individual is directly or indirectly paid, or entitled
to payment, by the Company or an Affiliate 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. For purposes of this paragraph
(c), an Employee shall not be credited with Hours of Service on account of payments
made or due (i) under a plan maintained solely for the purpose of complying with
applicable workmen’s compensation or unemployment compensation or disability insurance
laws or (ii) which solely reimburse an Employee for medical or medically related
expenses incurred by the Employee. For purposes of this paragraph (c), the number of
Hours of Service to be credited to an Employee shall be determined in
accordance with Department of Labor Regulations Sections 2530.200b-2(b)
and 2530.200b-2(c).

To the extent not credited above, Hours of Service will also be credited, based on the
customary work week of the Employee, for periods of military duty as required by
applicable law provided, however, that military duty shall count as Hours of Service only
if the individual returns to work for the Company or an Affiliate within the period and
under the conditions prescribed by such applicable law.

	1.21A	 	 “Insurance Company” means any legal reserve life insurance company which has issued one or
more group annuity contracts to the Company or the Trustee for the purpose of funding all or
a part of the benefits due under the Plan.

 

7

 

	1.22	 	“Interest Credit(s)” means the interest amounts credited to a Member’s Cash
Balance Account pursuant to Section 3.4.

	1.23	 	“Member” means any Eligible Employee who is currently participating in the Plan in accordance
with Article 2 or any former Eligible Employee who continues to be entitled to a benefit under
the Plan.

	1.24	 	“Non-Appendix B Member” means any Union Member who does not accrue any benefit under
Appendix B and

	 	(a)	 	who is hired by a Participating Company on or after January 1, 2001; or

	 	(b)	 	who is or becomes employed at the Mystic 8/9 facility or the Fore River
facility on or after January 1, 2001; or

	 	(c)	 	who elected to participate under the cash balance provisions of the Plan
pursuant to Section 2.2(a).

	1.25	 	“Normal Retirement Date” means the Member’s 65th birthday.

	1.26	 	“Opening Balance” means those amounts credited to the Cash Balance Accounts
of certain Eligible Employees as provided in Section 3.2.

	1.27	 	“Parental Absence” means an Employee’s absence from work which has commenced for
any of the following reasons:

	 	(a)	 	the pregnancy of the Employee;

	 
	 	(b)	 	the birth of the Employee’s child;

	 
	 	(c)	 	the adoption of a child by the Employee; or

	 	(d)	 	the need to care for the Employee’s child immediately following its birth or adoption.

	1.28	 	“Participating Company” means the Company and any Affiliated Company that adopts this
Plan with the Company’s permission.

	1.29	 	“Pay Credit” means the notional amounts credited to a Member’s Cash Balance Account pursuant
to Section 3.3.

	1.30	 	“Payment Date” means:

	 	(a)	 	the first day of the first period for which a benefit is payable to the
Member under the Plan as an annuity, (or to the Spouse or Beneficiary in the case of
death before retirement benefits commence), or

 

8

 

	 	(b)	 	in the case of a benefit payable in the form of a lump sum, the first day on
which all events have occurred (including completion of required application forms)
which entitle the Member, Spouse, or Beneficiary to such benefit.

	1.31	 	“Plan” means this entire Sithe Stable Pension Account Plan document unless the context
clearly indicates reference to Plan A or Plan B.

	1.32	 	“Plan A” means the provisions of this Sithe Stable Pension Account Plan document as
applicable to Eligible Employees other than Union Members, as from time to time amended,
subject to the requirements of Sections 9.1 and 12.10 of the Plan.

	1.33	 	“Plan B”, also known as the Sithe Union Employees Pension Plan, means the provisions of this
document which provide benefits to certain Union Employees as described in Appendix B and to
other Union Employees as described in the provisions of the Sithe Stable Pension Account,
subject to the requirements of Sections 9.1 and 12.10 of the
Plan. Prior to January 1, 2001,
Plan B was named the Sithe Energies Group Pension Plan.

	1.34	 	“Plan
Administrator” means the Dynegy Inc. Benefit Plans Committee.

	 
	1.35	 	 “Plan Year” means the calendar year.

	 
	1.36	 	“Reemployment or Reemployment Date” means the first day on which an Employee completes an Hour of Service after a Termination Date.

	 
	1.37	 	“Retirement Benefit” means either:

	 	(a)	 	a lump sum payment made pursuant to Section 4.2(b)(iii), or

	 
	 	(b)	 	monthly annuity payments.

	1.38	 	“Spouse” means the person to whom a Member is legally married on his Payment Date, or if
benefit payments have not commenced prior to date of death, the person to whom the Member was
legally married on the date of his death.

	1.39	 	“Termination Date” means the later of the date an Employee is discharged, dies,
retires, or voluntarily quits employment, or is otherwise deemed to be terminated from
employment with the Company and all Affiliated Companies according to the applicable
Participating Company’s standard personnel practice.

	1.40	 	“Trust” means the trust established pursuant to the Trust Agreement.

 

9

 

	1.41	 	“Trust Agreement” means the written agreements, one or more, between the
Company and the Trustee(s) in connection with the Plan, as such agreements may be in
existence or amended from time to time.

	1.42	 	“Trustee” means such individual(s), corporate entity, or financial institution as shall have
entered into the Trust Agreement with the Company and any successor thereto.

	1.43	 	“Union Member” means an Employee whose employment is governed by the terms of a
collective bargaining agreement between the Company and the Utility Workers Union of America,
AFL-CIO and Local 369, Utility Workers Union of America, AFL-CIO.

ARTICLE 2

PARTICIPATION AND SERVICE

	2.1	 	Eligibility Requirements. An Eligible Employee is each Employee who:

	 	(a)	 	is employed by a Participating Company;

	 
	 	(b)	 	is not a “leased employee” as defined in Code Section 414(n)(2); and

	 
	 	(c)	 	is not a Union Member accruing benefits under Appendix B.

	 	(d)	 	Notwithstanding anything to the contrary in this Section 2.1, no Employee or
Eligible Employee shall become a Member in the Plan on or after the Closing.

	2.2	 	Special One-Time Election.

	 	(a)	 	Union Members who on December 31, 2000 are both (1) employed by a
Participating Company and (2) are age 45 or older shall have a one-time opportunity to
elect in writing the retirement provisions under which they choose to be covered. Such
Union Members shall have a choice between participating in the cash balance provisions
described in the main body of this document (the Sithe Stable Pension Account)
or the modified traditional pension plan provisions described in Appendix B.

	 	(b)	 	Notwithstanding the above, any Union Member who is or becomes employed at
the Mystic 8/9 facility or the Fore River facility on or after January 1, 2001 shall
automatically be covered by the cash balance provisions described in the body of this
document and cease to be covered under the provisions of Appendix B.

	 	(c)	 	Irrespective of whether a Union Member is covered by the cash balance
provisions or the modified traditional pension provisions, all benefits for
Union Members are provided exclusively under Plan B and the assets related
thereto.

 

10

 

	2.3	 	Service.

	 	(a)	 	“Break in Service” means, in the case of any Employee, a Plan Year in
which the Employee has 500 or fewer Hours of Service, but not including any such Plan
Year before the one in which he ceases to be an Employee. Solely for purposes of
determining whether a Break in Service has occurred, there shall be credited to the
Employee as Hours of Service each hour not otherwise creditable under Section 1.21
during a Parental Absence; provided, that:

	 	(i)	 	Any Hour of Service credited hereunder with respect to an
absence shall be credited (A) only in the Plan Year in which the absence
begins, if the Employee would be prevented from incurring a Break in Service
in such Year solely because of Hours of Service credited hereunder for such
absence, or (B) in any other case, in the immediately following Plan Year;

	 	(ii)	 	No Hours of Service shall be credited hereunder unless the
Employee furnishes the Plan Administrator with such information as the Plan
Administrator may reasonably require (in such form and at such time as the
Plan Administrator may reasonably require) establishing (A) that the absence
from work is an absence described hereunder and (B) the number of days for
which the absence lasted.

	 	(iii)	 	In no event shall more than 501 Hours of Service be credited
to an Employee hereunder for any one absence by reason of pregnancy or the
placement of any one child.

	 	(b)	 	“Substantial Break” means, in the case of any Employee or Member who
does not have a nonforfeitable right to any portion of his Accrued Benefit, a number of
consecutive Breaks in Service which equals or exceeds five.

	 	(c)	 	“Year of Vesting Service” means a Plan Year during which an Employee
has at least 1,000 Hours of Service, subject to the following special rules:

	 	(i)	 	In the case of a Member who incurs a Substantial Break, Years
of Vesting Service prior to such Break will be disregarded.

	 	(ii)	 	In the event a Member has a Break in Service and thereafter
again becomes an Employee and a Member without having incurred a Substantial
Break, his Years of Vesting Service prior to his Break in Service shall be
restored to him.

 

11

 

ARTICLE 3

CASH BALANCE ACCOUNT

	3.1	 	In General. A notional account (hereinafter referred to as the Cash Balance Account)
shall be established and maintained for each Member who has been credited with at least 1,000
Hours of Service during a Plan Year. A Member’s Cash Balance Account shall consist of the sum
of (a) an Opening Balance, if any, determined in accordance with Section 3.2, (b) Pay Credits
determined in accordance with Section 3.3 and (c) Interest Credits determined in accordance
with Section 3.4.

	3.2	 	Opening Balance. The Cash Balance Account of each Union Member who participated in
the Sithe Energies Group Pension Plan immediately prior to January 1, 2001 and who is covered
by the provisions of this Plan on January 1, 2001, excluding any Union Member who makes the
election described in Section 2.2 of the Plan to accrue a benefit under Appendix B, shall be
credited with an Opening Balance as of January 1, 2001. The Opening Balance shall be equal to
the single sum Actuarial Equivalent value of the Member’s December 31, 2000 accrued benefit
under the Sithe Energies Group Pension Plan, calculated on the basis of the Member’s attained
age in years and completed months as of December 31, 2000 including the value of any early
retirement subsidy for which the Member would have qualified under Plan B had he retired on
December 31, 2000.

	3.3	 	Pay Credits.

	 	(a)	 	Except as provided under (b) and (c) below, as of the last day of each
calendar quarter, a Pay Credit shall be credited to the Cash Balance Account of each
Member who received Compensation during such quarter calendar. The Pay Credit
shall be equal to 3% of the Member’s Compensation for such calendar
quarter.

	 	(b)	 	Except as provided in (c) below, the Pay Credit described in (a) above shall
be rescinded if the Member is not credited with at least 1,000 Hours of Service for
the Plan Year in which the calendar quarter Pay Credit is made.

	 	(c)	 	2005 Plan Year. Notwithstanding subsections (a) and (b) above, solely
for the Plan Year beginning on January 1, 2005 (the “2005 Plan Year”), the Pay Credit
described in (a) above shall be credited immediately prior to the Closing to the Cash
Balance Account of each Member who received Compensation during for the 2005 Plan
Year. Such Pay Credit shall be rescinded if the Member is not credited with at least
1/12 of 1,000 Hours of Service for each full month in the period beginning on January
1, 2005 and ending immediately prior to the Closing.

 

12

 

	3.4	 	Interest Credits.

	 	(a)	 	Except as provided under (b) below, Interest Credits shall be equal to a
percentage of the Member’s Cash Balance Account as of the first day of a calendar
quarter and shall be added to each Member’s Cash Balance Account as of the last day of
such quarter. However, for any year in which payment of the Member’s Cash Balance
Account is made in any form, simple interest shall be credited on the amount of the
Member’s Cash Balance Account as of the first day of the quarter for the period from
the first day of such quarter to the expected Payment Date. In no event will Interest
Credits continue after benefits have commenced.

	 	(b)	 	If the Member’s Pay Credit is rescinded pursuant to Section 3.3(b), the
Interest Credit related thereto described in (a) above shall also be rescinded.

	 	(c)	 	Except as provided in (d) below, the annual rate of interest used to determine
the Interest Credit for a Plan Year shall be the annual average of the yield on
one-year constant maturity Treasury Bill rates in the preceding Plan Year (as published
in the Federal Reserve Statistical Release) plus 1%. This annual rate shall be
converted to a quarterly equivalent for purposes of the quarterly crediting of
interest.

	 	(d)	 	For purposes of determining a Member’s Accrued Benefit, Interest Credits will
be projected for future periods using the interest rate under this Section in effect at
the time the projection is made.

	3.5	 	Cash Balance Account. As of any date the value of a Member’s Cash Balance Account
shall be equal to the sum of the Opening Balance, if any, and Pay Credits and the Interest
Credits made to such Member’s Cash Balance Account.

Upon the conversion of a Member’s Cash Balance Account to an annuity, or payment of such
account as a lump sum, such Cash Balance Account shall cease to exist. However, a Member
may have a new Cash Balance Account established if he becomes a Member again following a
Payment Date.

	3.6	 	Reemployment of Members. In the event a Member to whom payment of his retirement
benefit under the Plan has commenced is reemployed by the Company or any Affiliated
Company, payment of his retirement benefit shall not be interrupted or otherwise adversely
affected. In the event a Member is reemployed by the Company or any Affiliated Company
before payment of his retirement benefit has commenced, his benefit shall not commence during
his period of reemployment, but shall be subject to the terms and conditions of Section 4.1.

 

13

 

ARTICLE 4

PAYMENTS

	4.1	 	Payment Dates. Subject to the limitations in Section 4.7, the Plan will pay vested
benefits under the Plan on the Payment Date and in the form of payment elected by the Member
under Section 4.2. However, if the lump sum cash-out amount under Section 4.2(b)(iii) is not
more than $1,000, the Plan Administrator will automatically distribute such amount as soon as
practicable after the Member’s Termination Date, and the Member may not elect an annuity form
of payment.

A Member who has not attained age 64 as of his Termination Date may elect a Payment Date
that is any day up to and including his Normal Retirement Date. A Member who has attained
age 64 or more as of his Termination Date may elect any Payment Date up to the month in
which he would attain 701/2.

	 	(a)	 	The Plan Administrator shall furnish any Member whose employment with the
Company or any Affiliated Company continues beyond his Normal Retirement Date (or
resumes his employment after his Normal Retirement Date, but prior to commencement of
the payment of his retirement benefit) with the notification described in 29 CFR
§ 2530.203-3. Upon such Member’s subsequent termination of employment, his
retirement benefit payable pursuant to Article IV shall be increased to the extent
required, if at all, under such regulations as provided in subsection (b) below to
avoid the effecting of a prohibited forfeiture of benefits by reason of the suspension
of benefits during such Member’s post Normal Retirement Date employment.

	 	(b)	 	A Member described in subsection (a) above shall be entitled to a retirement
benefit equal to the greater of:

	 	(i)	 	his Accrued Benefit determined pursuant to Section 1.1
through the date of his subsequent termination of employment; or

	 	(ii)	 	the Actuarial Equivalent of his Accrued Benefit payable at
his Normal Retirement Date.

	 	(c)	 	Further, such Member’s retirement benefit payable pursuant to this
Section 4.1 shall be increased to the extent required, if at all, under Section
401(a)(9)(C)(iii) of the Code in the event his employment or reemployment continues after April of the year immediately following the year he attains age seventy and one-half.

	 	(d)	 	In the event that Member elects a Payment Date after his Normal Retirement
Date, such Member’s benefit shall not be less than the Actuarial Equivalent of his
Accrued Benefit payable at his Normal Retirement Date.

 

14

 

	4.2	 	Forms of Payment.

	 	(a)	 	Normal Form. The normal form of benefit payable to an unmarried Member
will be the single life annuity described in subsection (b)(i) below. The normal form
of benefit payable to a Member who has a Spouse on his selected Payment Date will be
the qualified joint and survivor annuity which is the 50 percent joint and survivor
annuity with the Spouse as the Beneficiary as described in subsection (b)(ii) below.

	 	(b)	 	Optional Forms. Subject to the election procedures and other rules and
restrictions in this Article 4 and to the special, additional forms of payment for
certain Union Members under Section 4.3(c), a Member may elect one of the optional
forms of payment described in this subsection (b). The value of each of the annuity
forms of payment under subsection (ii) is the Actuarial Equivalent of the benefit that
would be payable to the Member as a single life annuity under subsection (i) below.

	 	(i)	 	Single Life Annuity. The single life annuity is a
monthly benefit beginning on the Member’s selected Payment Date and payable
throughout his lifetime, ending with the last payment due on the first day of
the month in which his death occurs. The single life annuity amount shall be
equal to the Actuarial Equivalent of the Member’s vested Cash Balance Account
based on the Member’s age at the Payment Date. Notwithstanding the foregoing,
the single life annuity for a Union Member as of any Payment Date shall never
be less than such Union Member’s accrued benefit under Plan B as of December
31, 2000 reduced for early payment by using the Member’s age at the Payment
Date and the provisions of Plan B in effect on December 31, 2000.

	 	(ii)	 	Joint and Survivor Annuity. The joint and survivor
annuity is a reduced monthly benefit beginning on the Member’s Payment Date and
payable throughout his lifetime, with either 50 percent or 100 percent, as
elected by the Member, of that monthly amount continuing for life to his
surviving Beneficiary, beginning on the first day of the month following the
month in which the Member’s death occurs. The joint and survivor annuity is the
Actuarial Equivalent of the single life annuity.

	 	(iii)	 	Lump Sum Cash-out.

	 	(A)	 	Form. The lump sum cash-out is a
single payment of a Member’s entire vested interest in the Plan.

 

15

 

	 	(B)	 	Amount. As of any Payment Date, the lump sum cash-out value of the Member’s
Plan benefit is the value of such Member’s vested Cash Balance Account as of
such Payment Date. However, if greater than the Member’s Cash Balance Account, the amount
of such lump sum shall be equal to the greater of the lump sum Actuarial Equivalent of a
Union Member’s: (1) immediate single life annuity based on the Member’s December 31, 2000
accrued benefit under Plan B reduced for early commencement on the Payment Date, or (2)
the Member’s single life annuity payable at age 65 based on the Member’s December 31, 2000
accrued benefit under Plan B. Both (1) and (2) shall be developed using the interest and
mortality assumptions in effect under Plan Section 1.2(b) for the Plan Year in which the
Payment Date occurs, the Union Member’s age as of the Payment Date and the terms of Plan B
in effect on December 31, 2000 (except for the aforementioned interest and mortality
assumptions). Notwithstanding the immediately preceding sentence, for Payment Dates
occurring in the 12-month period ending on December 31, 2001, the Applicable Interest Rate
in effect under Plan B on December 31, 2000 shall be used to determine the lump sum if
such rate produces a greater lump sum amount.

	 	(C)	 	Over $1,000. If the amount determined under (B) above is greater than $1,000, the
Member may elect to receive the lump sum cash-out only if his Spouse consents to that form of
distribution as required under Section 4.3. The Plan will simultaneously offer to the Member
all annuity forms of payment. A Member may not split his distribution between an annuity and a
lump sum cash-out.

	 	(D)	 	Not Over $1,000. If the amount determined under (B) above is not over $1,000, the
Plan Administrator will automatically make a lump sum cash-out payment to the Member as soon
as practicable after his Termination Date without the Member’s consent.

	 	(E)	 	Nonvested Member. Regardless of the amount determined under (B) above, the Plan
Administrator will treat each Member who is not fully vested in his Plan benefit as having
received a constructive cash-out of his entire non-vested Plan benefit as of his Termination
Date, and if he resumes Employment before he incurs a five consecutive Breaks in Service will
treat him has having repaid his constructive cash-out as of his Reemployment Date.

 

16

 

	 	(F)	 	Direct Rollover of Lump Sum Payments. A Member who is
eligible to receive a lump sum cash-out may instruct the Plan
Administrator to roll over all or part of his lump sum payment to an
eligible retirement plan. An eligible retirement plan is an
individual retirement account described in Code Section 408(a), an
individual retirement annuity described in Code Section 408(b), an
annuity plan described in Code Section 403(a), a qualified trust
described in Code Section 401(a), and, effective for distributions
made after December 31, 2001, an annuity contract described in Code
Section 403(b) and an eligible plan under Code Section 457(b) which
is maintained by 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 an alternate payee under a
qualified domestic relations order, as defined in Code Section
414(p).

The Member, Spouse, or former Spouse, as applicable, must timely
provide in writing all information required to effect the rollover.

	 	(c)	 	Special Optional Payment Forms for Certain Union
Members. In lieu of one of the payment forms described in Section 4.2(b),
Union Members who have an Opening Balance may select an optional form of
payment described in Appendix B, Section B8.1. Each optional form shall be the
Actuarial Equivalent of the single life annuity otherwise payable to such Union
Member, but in no event less valuable than the individual’s accrued benefit at
December 31, 2000 under the terms and conditions of the Sithe Energies Group
Pension Plan on such date.

	4.3	 	Election Procedures.

	 	(a)	(1)	Except as provided in subsections (a)(2) and (a)(3) below, within
the period of time commencing ninety (90) days, and ending thirty (30) days,
prior to his Payment Date, the Plan Administrator shall give each Member a
written notice that Plan benefits thereafter payable will be in the form of a
joint and survivor annuity under Section 4.2(a) in the case of a married
Member unless the Member makes a Qualified Election within the applicable
Election Period to receive Plan benefits payable under the Plan in another
form. In the case of a Member who is not married, the notice shall inform him that Plan benefits will be paid in the form of an applicable life annuity under Section
4.2(a) unless a Qualified Election is made for another form of benefit payable under the
Plan. Such notice shall also provide written explanation of (i) the terms and conditions
of the applicable standard form of annuity; (ii) the Member’s right to make, and the
effect of, an election to waive the applicable standard annuity form of benefit; (iii)
the relative values of the applicable optional forms of benefit available; (iv) the
rights of a Member’s Spouse; (v) the right to make, and the effect of, a revocation of a
previous election to waive the applicable standard form of annuity; (vi) if applicable,
his right to defer his Payment Date; and (vii) if applicable, his right to a direct
rollover pursuant to Section 4.2(b)(iii)(F).

 

17

 

	 	(2)	 	In the event the written notice described in subsection (a)(1) above is provided to a Member
before his Payment Date but less than thirty (30) days prior to such date, such Member (with
the consent of his Spouse, if he is married) may elect, on a properly completed election form
provided by the Plan Administrator, to waive the minimum thirty (30) day notice period
described in subsection (a)(1) above, provided the following conditions are met:

	 	(A)	 	The Plan Administrator provides descriptive information to
the Member clearly indicating that he has the right to at least thirty (30) days
to consider whether to waive the applicable standard form of annuity and elect
an alternative form of benefit available to him under the Plan;

	 	(B)	 	The Member is permitted to revoke an election made pursuant to (A)
above at least until the Payment Date, or, if later, at any time prior to the
expiration of the seven (7)-day period which begins on the day immediately following
the date the written notice described in subsection (a)(1) above is provided to the
Member and distribution in accordance with such election does not commence prior to
the expiration of such seven (7)-day period; and

	 	(C)	 	The Member’s Payment Date is after the date such written notice is provided
to the Member.

The Member’s Payment Date may be prior to the date the Member makes any affirmative
benefit distribution election pursuant to this subsection (a)(2) and prior to the date
distribution is permitted to commence pursuant to (B) above, provided that, except in a
case due solely to administrative delay, distribution pursuant to such election shall
commence not more than ninety (90) days after the
written notice described in subsection (a)(1) above is provided to
the Member.

 

18

 

	 	(3)	 	In accordance with the conditions and requirements of this subsection (a)(3) and of Code
Section 417(a)(7) and the Treasury Regulations promulgated thereunder, a Member who is
eligible to do so may elect a retroactive annuity starting date with respect to the
distribution of his retirement benefit. For purposes of the Plan, a retroactive annuity
starting date (‘RASD’) means a Payment Date affirmatively elected by a Member which is on or
before the date the written notice described in subsection (a)(1) above is provided to the
Member,

	 	(A)	 	A Member shall be eligible to elect a RASD only if the
following requirements and conditions are met:

	 	(i)	 	The Member has requested the written notice described in
subsection (a)(1) above prior to his Payment Date and, solely due to
administrative delay, such written notice is provided to the Member on or
after his Payment Date;

	 	(ii)	 	The Member’s retirement benefit payments have not
commenced;

	 	(iii)	 	The Member’s elected RASD is not prior to the date of
his termination of employment;

	 	(iv)	 	The Member’s spouse (including an alternate payee who is
treated as such spouse under an order the Committee has determined to be a
qualified domestic relations order), determined as if the date distributions
are to commence was the Member’s Payment Date, consents to the distribution
in a Qualified Election; provided, however, such spousal consent is not
applicable if the amount of the survivor annuity payments for such spouse
under the RASD election are not less than the amount of the survivor annuity
payments for such spouse under the applicable standard form of annuity with
a Payment Date after the date the written notice described in subsection
(a)(1) above is provided to the Member;

 

19

 

	 	(v)	 	Any distribution (including appropriate interest
adjustments) based on the RASD must satisfy the requirements of Section
415 of the Code if the date
the distribution is to commence is substituted for the Payment Date for all
purposes, including for purposes of determining the Applicable Interest Rate
and the applicable mortality table described in Section 1.2 of the Plan;
provided, however, satisfaction of such requirement is not required in the case
of a distribution in the form of an annuity described in Section 4.2 and the
date such distribution is to commence in any such form is twelve (12) months or
less from the RASD; and

	 	(vi)	 	In the case of a form of retirement benefit distribution which would have
been subject to the present value requirements of Section 417(e)(3) of the Code if
such distribution had actually commenced as of the RASD, such distribution must be
not less than the retirement benefit produced by application of the Applicable
Interest Rate and the applicable mortality table described in Section 1.2 of the
Plan determined as of the date distribution is to commence to the annuity form which
corresponds to the annuity form used to determine the retirement benefit amount as
of the RASD.

	 	(B)	 	The future payments of retirement benefits to the Member must be the same as the future
payments of retirement benefit which would have been paid to the Member if such payments had
actually commenced on the RASD and the Member must receive a make-up payment to reflect the
missed payment or payments for the period between the RASD and the date of the actual make-up
payment (with an appropriate adjustment for interest at the Applicable Interest Rate for such
period on such missed payment or payments);

	 	(C)	 	The written notice described in subsection (a)(1) above must generally be provided to the
Member not less than thirty (30) days nor more than ninety (90) days prior to the date of the
first payment pursuant to the Member’s election of an RASD and such election must be made
after such written notice is provided but on or prior to the date of such first payment;
provided, however, such written notice may be provided less than thirty (30) days prior to the
date of such first payment if the requirements of subsection (a)(2) above would be
satisfied when such date is substituted for the Payment Date in applying the requirements of
such subsection other than the requirements described in the final sentence of such subsection; and, provided, further, that, except in a case due solely to administrative delay, the date of such first payment shall be not more than ninety (90) days after such written notice is provided to the Member.

 

20

 

	 	(4)	 	For purposes of this Section 4.3(a), the following defined terms have the
meanings provided below where such terms are used in the initially capitalized form:

	 	(A)	 	The term ‘Election Period’ shall mean, subject to
the modifications under certain circumstances described in subsection
(a)(2) and (a)(3) above, the ninety (90) day period ending on the
Member’s Payment Date.

	 	(B)	 	The term ‘Qualified Election’ shall mean an election to waive
the applicable standard form of annuity. The Member’s election must be in
writing and, if he is married, must be consented to by his Spouse. The Spouse’s
consent to an election must acknowledge the applicable standard form of annuity
and the Spouse must acknowledge such consent before a notary public or Plan
representative. The waiver must state the specific beneficiary applicable
(including any class of beneficiaries). Such election may not be changed
without further Spousal consent. Notwithstanding this consent
requirement, if the Member establishes to the satisfaction of the Plan
Administrator that such written consent may not be obtained because there is
no Spouse or the Spouse cannot be located, an election will be deemed a
Qualified Election. Also, if the Member is legally separated or has been
abandoned (within the meaning of applicable law) and the Member has a court
order to such effect, Spousal consent is not required. Any consent necessary
under this subsection (4)(B) will be valid only with respect to the
Spouse who signs the consent, or in the event of a deemed Qualified Election,
the designated Spouse. Additionally, a revocation of a prior election may be
made by a Member without the consent of the Spouse at any time during the
applicable Election Period. The number of revocations shall not be limited. Any
new election of an optional form of benefit will require new Spousal consent.
The preceding sentence shall not apply if such election is back to the
applicable standard form of annuity.

 

21

 

	 	(b)	 	Any Member who would otherwise receive the standard form of benefit described in Section 4.2
may elect not to take his benefit in such form by properly executing and filing the benefit
election form prescribed by the
Plan Administrator during the Election Period described in Section 4.3(a)(4)(A) as
a Qualified Election as described in Section 4.3(a)(4)(B). The Member who has a
Spouse may elect to receive either the 50 percent or 100 percent joint and survivor
annuity with his Spouse as his Beneficiary, and he will not be required to have his
Spouse’s consent to make this election.

	4.4	 	Effect of Death on Forms of Payment.

	 	(a)	 	Death of Spouse or Beneficiary Before Benefits Begin. If the Member
elects a payment form with a survivor benefit and his designated Beneficiary
dies under such form of payment before his Payment Date, the survivor form of payment
will not become effective and he will instead receive his retirement benefit in the
normal form under Section 4.2(a) unless he properly elects another form before his
Payment Date and his Spouse consents, if required.

	 	(b)	 	Death of Member Before Benefits Begin. If the Member elects any form of
payment with a survivor benefit and he dies before his Payment Date, his Spouse or
other Beneficiary will not be entitled to any benefits under any such form. However,
the pre-distribution death benefit described under Article 5 shall be payable.

	 	(c)	 	Death of Spouse or Beneficiary After Benefits Begin. If the Member’s
benefit has begun in any form with a survivor benefit and his Spouse or other
Beneficiary dies before he does, he will continue to receive his benefit in the same
form.

	 	(d)	 	Death of Member After Benefits Begin. If the Member dies after his
benefits have begun, no death benefit will be payable except to the extent provided
under the form of annuity he was receiving.

4.5   Payment on Member’s Behalf.

	 	(a)	 	Payment to the Member’s Representative. If the Member is incompetent
to handle his affairs on his Payment Date or thereafter, or cannot be located after
reasonable effort, the Plan Administrator, in its discretion, may make payments to his
court-appointed personal representative, or if none is appointed the Plan
Administrator may in its discretion make payments to his next-of-kin.

	 	(b)	 	Payment to Minor or Incompetent Beneficiaries. In the event the
deceased Member’s Beneficiary is a minor, or is legally incompetent, or cannot be
located, the Plan Administrator may, in its discretion, make payment to the
court-appointed guardian or representative of such beneficiary, or to a trust
established for the benefit of such Beneficiary, as applicable.

 

22

 

	 	(c)	 	Judicial Determination. In the event the Plan Administrator considers
it necessary, it may have a court of applicable jurisdiction determine to whom
payments should be made.

	4.6	 	Unclaimed Benefits. In the event the Plan Administrator cannot locate any person
entitled to receive the Member’s vested Plan Benefit, with reasonable effort and after a
period of five years, his interest will be canceled. However, the Member’s interest will be
reinstated within 60 days after he is located, as required under Treasury Regulations Section
1.401(a)-14(d) or any other applicable law. The Plan Administrator will pay any required
retroactive payment in a single sum without adjustment for interest.

	4.7	 	Maximum Benefit Limitation.

	 	(a)	 	General Limitation. Notwithstanding any other provision of the Plan,
neither a Member’s Retirement Benefits under the Plan nor his own contributions
shall, in any limitation year, be in an amount which would cause the applicable
limitations under section 415 of the Code, which limitations are hereby incorporated by
reference, to be exceeded. With respect to limitation years beginning prior to January
1, 2000, if the Plan Administrator shall so elect, a Member’s defined contribution plan
fraction under section 415(e) of the Code shall be determined in accordance with the
special transition rule set forth in section 415(e) (6) of the Code. For purposes of
this Section and section 415 of the Code, “limitation year” means the calendar year.

	 	(b)	 	Reduction in contributions or benefits. In the event any reduction of
the Member’s benefits are required to satisfy the limitations of section 415(b) of the
Code, the amount of the necessary reduction shall be applied in equal proportions
against his annual benefit under this Plan and under each other defined benefit plan
(if any) maintained by the Company or an Affiliated Company. For limitation years
beginning prior to January 1, 2000, in the event the Member’s benefits would cause the
limitations of section 415(e) of the Code to be exceeded, the Member’s annual benefit
under this Plan and under each other defined benefit plan (if any) maintained by the
Company or Affiliated Company shall be reduced in equal proportions (insofar as
practicable) until such limitations have been satisfied and then, if such
reduction is insufficient to satisfy such limitations, the Member’s annual
addition under any defined contribution plan maintained by the Company or an Affiliated
Company shall be reduced until such limitations have been satisfied. In the event any
reduction in a Member’s annual additions are required in order to satisfy the
limitations of section 415(c) of the Code, such reduction shall be made first in any
other, defined contribution plan maintained by the Company, and thereafter to the extent necessary in Member contributions under this Plan.

 

23

 

	 	(c)	 	Actuarial Equivalencies — In the event that payment is made in any form other
than a life annuity or qualified 50% joint and survivor annuity, the determination as
to whether the limitations of this Section 4.7 have been satisfied shall be made, in
accordance with regulations prescribed by the Secretary of the Treasury, by adjusting
such benefit so that it is equivalent to the benefit payable in the form of a life
annuity or a qualified 50% joint and survivor annuity. Such adjustment shall be made
on the basis of the interest rate and mortality table (or other tabular factor)
specified in Section 1.2.

	4.8	 	Minimum Distribution Requirements.

	 	(a)	 	General Rules

	 	(i)	 	Effective Date. The provisions of this Section 4.8
will apply for purposes of determining required minimum distributions for
calendar years beginning with the 2003 calendar year.

	 	(ii)	 	Precedence. The requirements of this Section 4.8 will
take precedence over any inconsistent provisions of the Plan.

	 	(iii)	 	Requirements of Treasury Regulations Incorporated. All
distributions required under this Section 4.8 will be determined and made
in accordance with the Treasury regulations under Code Section 401(a)(9).

	 	(b)	 	Time and Manner of Distribution.

	 	(i)	 	Required Beginning Date. The Member’s entire interest
will be distributed, or begin to be distributed, to the Member no later than
the Member’s required beginning date.

	 	(ii)	 	Death of Member Before Distributions Begin. If the
Member dies before distributions begin, the Member’s entire interest will be
distributed, or begin to be distributed, no later than as follows:

	 	(A)	 	If the Member’s surviving Spouse is the
Member’s sole designated Beneficiary, distributions to the surviving
Spouse will begin by December 31 of the calendar year immediately
following the calendar year in which the Member died, or by December 31
of the calendar year in which the Member would have attained age 70
1/2, if later.

	 	(B)	 	If the Member’s surviving Spouse is not the Member’s sole designated
Beneficiary, then distributions to the designated Beneficiary will begin by
December 31 of the calendar year immediately following the calendar year
in which the Member died.

 

24

 

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

	 	(D)	 	If the Member’s surviving Spouse is the Member’s sole designated Beneficiary
and the surviving Spouse dies after the Member but before distributions to the
surviving Spouse begin, this Paragraph (b)(ii), other than Paragraph (b)(ii)(A) will
apply as if the surviving Spouse were the Member.

For purposes of this Paragraph (b)(ii) and Paragraph (e), distributions are
considered to begin on the Member’s required beginning date (or, if Paragraph
(b)(ii)(D) applies, the date distributions are required to begin to the surviving
Spouse under Paragraph (b)(ii)(A)). If annuity payments irrevocably commence to
the Member before the Member’s required beginning date (or to the Member’s
surviving Spouse before the date distributions are required to begin to the
surviving Spouse under Paragraph (b)(ii)(A)), the date distributions are
considered to begin is the date distributions actually commence.

	 	(iii)	 	Form of Distribution. Unless the Member’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 Paragraphs (c), (d) and (e) of this Section 4.8. If the Member’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 Code Section 401(4)(9) and the
Treasury regulations. Any part of the Member’s interest which is in the form of an individual
account described in Section 414(k) of the Code will be distributed in a manner satisfying the
requirements of Code Section 401(a)(9) and the Treasury regulations that apply to individual
accounts.

 

25

 

	 	(c)	 	Determination of Amounts to be Distributed Each Year.

	 	(i)	 	General Annuity Requirements. If the Member’s interest is paid in
the form of annuity distributions under the Plan, payments under the annuity will
satisfy the following requirements:

	 	(A)	 	the annuity distributions will be paid in periodic payments
made at intervals not longer than one year;

	 	(B)	 	the distribution period will be over a life (or lives) or
over a period certain not longer than the period described in Paragraphs
(d) or (e);

	 	(C)	 	once payments have begun over a period certain, the period
certain will not be changed even if the period certain is shorter than the
maximum permitted;

	 	(D)	 	payments will either be nonincreasing or increase only as follows:

	 	(1)	 	by an annual percentage increase that
does not exceed the annual percentage increase in a cost-of-living
index that is based on prices of all items and issued by the Bureau
of Labor Statistics;

	 	(2)	 	to the extent of the reduction in the
amount of the Member’s payments to provide for a survivor benefit
upon death, but only if the Beneficiary whose life was being used
to determine the distribution period described in Paragraph (d)
dies or is no longer the Member’s Beneficiary pursuant to a
qualified domestic relations order within the meaning of Code
Section 414(p);

	 	(3)	 	to pay increased benefits that result from
a plan amendment.

	 	(ii)	 	Amount Required to be Distributed by Required Beginning Date. The
amount that must be distributed on or before the Member’s required beginning date
(or, if the Member dies before distributions begin, the date distributions are
required to begin under Paragraph (b)(ii)(A) or (B)) is the payment that is required
for one payment interval. The second payment need not be made until the end of the
next payment interval even if that payment interval ends in the next calendar year.
Payment intervals are the periods for which payments are received, e.g., bi-monthly,
monthly, semi-annually, or annually. All of the Member’s benefit accruals as of the last day of
the first distribution calendar year will be included in the calculation of the
amount of the annuity payments for payment intervals ending on or after the
Member’s required beginning date.

 

26

 

	 	(iii)	 	Additional Accruals After First Distribution Calendar Year. Any
additional benefits accruing to the Member in a calendar year after the first
distribution calendar year will be distributed beginning with the first payment
interval ending in the calendar year immediately following the calendar year in
which such amount accrues.

	 	(d)	 	Requirements for Annuity Distributions That Commence During Member’s Lifetime.

	 	(i)	 	Joint Life Annuities Where the Beneficiary Is Not the Member’s
Spouse. If the Member’s interest is being distributed in the form of a joint and
survivor annuity for the joint lives of the Member and a nonspouse Beneficiary,
annuity payments to be made on or after the Member’s required beginning date to the
designated Beneficiary after the Member’s death must not at any time exceed the
applicable percentage of the annuity payment for such period that would have been
payable to the Member using the table set forth in Q&A-2 of Section 1.401(a)(9)-6T of
the Treasury regulations. If the form of distribution combines a joint and survivor
annuity for the joint lives of the Member and a nonspouse Beneficiary and a period
certain annuity, the requirement in the preceding sentence will apply to annuity
payments to be made to the designated Beneficiary after the expiration of the period
certain.

	 	(ii)	 	Period Certain Annuities. Unless the Member’s Spouse is the sole
designated Beneficiary and the form of distribution is a period certain and no life
annuity, the period certain for an annuity distribution commencing during the Member’s
lifetime may not exceed the applicable distribution period for the Member under the
Uniform Lifetime Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations
for the calendar year that contains the annuity starting date. If the annuity starting
date precedes the year in which the Member reaches age 70, the applicable distribution
period for the Member is the distribution period for age 70 under the Uniform Lifetime
Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations plus the excess
of 70 over the age of the Member as of the Member’s birthday in the year that contains
the annuity starting date. If the Member’s Spouse is the Member’s sole designated
Beneficiary and the form of distribution is a period certain and no life annuity, the
period certain may not exceed the longer of the Member’s applicable distribution
period, as determined under
Paragraph (d)(ii), or the joint life and last survivor expectancy of the Member
and the Member’s Spouse as determined under the Joint and Last Survivor Table set
forth in Section 1.401(a)(9)-9 of the Treasury regulations, using the Member’s
and Spouse’s attained ages as of the Member’s and Spouse’s birthdays in the
calendar year that contains the annuity starting date.

 

27

 

	 	(e)	 	Requirements For Minimum Distributions Where Member Dies Before Date Distributions
Begin.

	 	(i)	 	Member Survived by Designated Beneficiary. If the Member dies
before the date distribution of his interest begins and there is a designated
Beneficiary, the Member’s entire interest will be distributed, beginning no later
than the time described in Paragraph (b)(ii)(A) or (B), over the life of the
designated Beneficiary or over a period certain not exceeding:

	 	(A)	 	unless the annuity starting date is before the first
distribution calendar year, the life expectancy of the
designated Beneficiary determined using the Beneficiary’s age as of the
Beneficiary’s birthday in the calendar year immediately following the
calendar year of the Member’s death; or

	 	(B)	 	if the annuity starting date is before the first distribution
calendar year, the life expectancy of the designated Beneficiary
determined using the Beneficiary’s age as of the Beneficiary’s birthday in the
calendar year that contains the annuity starting date.

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

	 	(iii)	 	Death of Surviving Spouse Before Distributions to Surviving Spouse
Begin. If the Member dies before the date distribution of his interest begins,
the Member’s surviving Spouse is the Member’s sole designated Beneficiary, and the
surviving Spouse dies before distributions to the surviving Spouse begin, this
Paragraph (e) will apply as if the surviving Spouse were the Member, except that the
time by which distributions must begin will be determined without regard to Paragraph
(b)(ii)(A).

 

28

 

	 	(f)	 	Definitions.

	 	(i)	 	Designated Beneficiary. The individual who is
designated as the Beneficiary under Section 1.6 of the Plan and is the
designated Beneficiary under Code Section 401(a)(9) and Section 1.401(a)(9)-1,
Q&A-4, of the Treasury regulations.

	 	(ii)	 	Distribution Calendar Year. A calendar year for which a
minimum distribution is required. For distributions beginning before the
Member’s death, the first distribution calendar year is the calendar year
immediately preceding the calendar year which contains the Member’s required
beginning date. For distributions beginning after the Member’s death, the first
distribution calendar year is the calendar year in which distributions are
required to begin pursuant to Paragraph (b).

	 	(iii)	 	Life expectancy. Life expectancy as computed by use of
the Single Life Table in Section 1.401(a)(9)-9 of the Treasury regulations.

	 	(iv)	 	Required beginning date. The applicable date specified
in Section 12.8(b) of the Plan.

ARTICLE 5

PRE-DISTRIBUTION DEATH BENEFITS

	5.1	 	General Provisions. If a Member dies before his Payment Date occurs, 100% of his Cash
Balance Account will be payable to the Member’s Beneficiary. If a Member is married on the
date of his death before his Payment Date, his Spouse shall be his automatic sole Beneficiary
unless the Member elects otherwise and the Spouse consents in writing in the manner described
under Section 4.3. If a Member is not married on his date of death and has not elected a
Beneficiary, his estate shall automatically be his sole Beneficiary.

	5.2	 	Payment. If the Cash Balance Account is not greater than $1,000 or if the Beneficiary
is not the Spouse, the Plan Administrator will automatically pay the Member’s entire Cash
Balance Account in a lump sum payment as soon as practicable after the Member’s death. If the
Cash Balance Account is greater than $1,000, the Member’s surviving Spouse Beneficiary may
elect to receive a lump sum or a single life annuity. Single life annuity payments shall be
for the Spouse’s lifetime only and shall be determined by converting the Member’s Cash Balance
Account to a single life annuity payable to the Spouse in the manner described under Section 4.2(b)(i) using the Spouse’s age at the Payment Date for such Spouse.

 

29

 

The Spouse may elect for annuity payments to commence at any time after the Member’s death.
If the Spouse does not elect earlier payment, the Payment Date
for the Spouse’s survivor benefit payable as a life annuity will be the Member’s Normal
Retirement Date.

Lump sum payments to a non-Spouse Beneficiary will be paid as soon as practicable after the
Member’s death. A Spouse electing to receive a lump sum death benefit must receive such
lump sum within 12 months of the Member’s death.

Neither an annuity payable to a Spouse hereunder nor the Actuarial Equivalent of a lump sum
paid to such Spouse hereunder shall be less than the qualified preretirement survivor’s
annuity described in Code Section 417(c).

ARTICLE 6

DISABILITY

	6.1	 	Disability. If a Non-Appendix B Member incurs a Disability, Pay Credits under Section
3.3 will continue (at the rate last in effect before the Disability) until the earlier of (a)
the Member’s elected Payment Date or (b) the end of the calendar quarter in which payments
under the Participating Company’s long-term disability plan cease for any reason.

	6.2	 	Disability Election. A Non-Appendix B Member who has incurred a Disability may elect
to receive his vested Accrued Benefit at any time after he is no longer deemed to be an
Employee of the Company or any Affiliated Company under the standard personnel practices of
the applicable Participating Company.

	6.3	 	Cessation. Notwithstanding anything to the contrary in this Article
6, a Non-Appendix B Member who has incurred a Disability shall not receive
continued Pay Credits with respect to the periods beginning on or after the Closing.

ARTICLE 7

VESTING

	 	 	 	 	 	 	 	 
	7.1

	 	 	(a)
	 	 	 	For each Year of Vesting Service a Non-Appendix B Member shall vest 33-1/3% in his
Accrued Benefit. A Non-Appendix B Member shall have a nonforfeitable right to his entire
Accrued Benefit after completing three Years of Vesting Service.

	 	(b)	 	Notwithstanding the above, a Non-Appendix B Member shall have a fully
vested, nonforfeitable interest in his Accrued Benefit upon the earliest of:

	 	(i)	 	full vesting under (a) above;

	 	(ii)	 	his attainment of age 65 (Normal Retirement Age)
while an Employee; or

	 	(iii)	 	his death while an Employee.

 

30

 

	 	(c)	 	Notwithstanding subsections (a) and (b) above, effective immediately prior to the
Closing, a Non-Appendix B Member shall have a fully vested, nonforfeitable right to his
Accrued Benefit. Notwithstanding subsections (a) and (b) above, effective immediately prior
to the Closing (as defined in the Plan’s Fourth Amendment), a Member who is employed by a
Participating Company immediately prior to the Closing shall have a fully vested,
nonforfeitable right to his Accrued Benefit.

ARTICLE 8

BENEFICIARIES

	8.1	 	Beneficiary Designation. Each Member may designate the Beneficiary (including any
co-beneficiary or contingent beneficiary) to whom any benefits, which are payable to a
Beneficiary and which are provided hereunder upon or after the Member’s death, shall be paid.
The Member may change his Beneficiary from time to time, before or after his retirement. Any
designation or change of Beneficiary shall be subject to the provisions of Section 4.3 and
shall be made by filing written notice thereof with the Plan Administrator in such form as it
shall prescribe.

	8.2	 	Death of Beneficiary. In the event of the death of any Beneficiary prior to that of
the Member, the interest of such Beneficiary shall vest in the Member by whom he was
designated. If there is no designated Beneficiary living at the time when any death benefit
hereunder would be payable to the Beneficiary, such death benefit shall be payable to the
Member’s estate. Any such payment shall fully discharge the liability of the Plan,
the Fund, the Company, the Plan Administrator, the Trustee and the Insurance
Company.

ARTICLE 9

FUNDING AND CONTRIBUTIONS

	9.1	 	Establishment of the Funds. Separate Funds shall be established by the
Company for benefits under Plan A and Plan B. Each of the respective Funds shall hold all
contributions made by the Company and earnings and other income attributable thereto for the
related plan. All benefits payable under Plan A shall be exclusively disbursed from the
related Plan A Fund. All benefits payable to Union Members shall be disbursed from the Fund
related to Plan B.

	9.2	 	Company Contributions. The Plan Administrator shall establish and maintain a funding
policy based on periodic actuarial valuations and reports, which policy shall require
contributions at least sufficient to satisfy the minimum funding standards of ERISA and the
Code. The Company shall make contributions to the Plan at such times and in such amounts as
may be required by or appropriate
under the Plan’s funding policy. All contributions by the Company are conditioned upon
their deductibility under section 404 of the Code.

 

31

 

	9.3	 	Return of Company Contributions. Anything herein to the
contrary notwithstanding, a contribution or a portion of a contribution made to the Fund by
the Company may be returned to the Company under any of the following conditions:

	 	(a)	 	In the case of a contribution which is made by reason of a good faith mistake
of fact, the contribution or portion of the contribution so made may be returned to the
Company within one year after the payment thereof.

	 	(b)	 	In the event that a deduction for any contribution or portion thereof is
disallowed under section 404 of the Code, such contribution or such portion thereof, as
the case may be, may be returned to the Company within one year after the disallowance
of the deduction.

	 	(c)	 	In the case of a contribution made in good faith and conditioned upon the
initial qualification of the Plan under section 401(a) of the Code, but the
Plan is determined not to be so qualified, such contribution, or portion
thereof, may be returned to the Company within one year after the Plan is
deemed not to be so qualified.

	9.4	 	Forfeitures and Other Gains. Gains arising from any forfeiture of the interest in the
Fund of any Member because of death, severance of employment or any other reason shall be
applied to reduce the amount of Company contributions and not to increase the benefits
otherwise payable under the Plan.

	9.5	 	Expenses. The expenses of administering Plan A or Plan B, including but not limited
to, the fees and expenses of the Trustee as set forth in the applicable Trust Agreements, the
fees and expenses of any Insurance Company for group annuity contracts, the fees and expenses
of any actuary and of any counsel or other persons employed by the Company or its delegates in
the administration of such plan, and including the premiums for plan termination insurance
purchased by the Plan Administrator from the Pension Benefit Guaranty Corporation, shall to
the extent permitted by law and as directed by the Company, be paid by and from the respective
Fund. To the extent not paid from a Fund, such expenses shall be paid by the Company and may
be reimbursed to the Company from the appropriate Fund. Notwithstanding the above, the cost
to obtain a statement showing the value of a terminated Member’s vested Accrued Benefits,
other than the statement provided with respect to the Member’s Termination Date and the annual
statements thereafter, will be charged to such Member.

	9.6	 	Actuarial Valuations. All actuarial valuations of Plan A and Plan B shall be made by
or under the supervision of an actuary retained or employed by the Company (or its delegate)
who is enrolled by the Joint Board for the Enrollment of Actuaries
established under ERISA and shall be made upon such assumed rates of interest, mortality,
and other actuarial components and according to such methods of computation as the actuary,
after consultation with the Company (or its delegate), may determine to be proper and
reasonable.

 

32

 

ARTICLE 10

ADMINISTRATION

	10.1	 	Delineation of Fiduciary Responsibilities. The fiduciaries with respect to Plan A
and Plan B shall be the Company (and its delegate), the Plan Administrator and the respective
Trustees and, to the extent required by ERISA, any Insurance Company. The responsibilities of
the fiduciaries shall be allocated as provided herein, and each such fiduciary shall have
only those responsibilities and obligations that are specifically imposed upon it by the
Plan, Trust Agreement or any group annuity contract. Except as otherwise provided by law,
each of the fiduciaries shall be responsible for the proper exercise of its own powers,
duties, responsibilities and obligations under the Plan, and shall not be responsible for any
act or failure to act of any other fiduciary.

	 	(a)	 	Except as provided in Section 11.1, the Company shall have the sole power to
amend and terminate Plan A and Plan B, the sole responsibility to make contributions to
each Fund as provided in Article 9 and such other powers and duties as are herein
specifically provided.

	 	(b)	 	The Trustee shall have the sole responsibility for the administration of the
Trust and, to the extent not delegated to one or more investment managers (within the
meaning of section 3(38) of ERISA) or some other named fiduciary (including, but
not limited to, the Board or Plan Administrator, the management and control of
the assets of the Fund which it receives and invests in accordance with the terms of
the Trust Agreement.

	 	(c)	 	An Insurance Company shall have the sole responsibility for the
administration of any group annuity contract and the management and control of the
assets of the Fund which it receives and invests in accordance with the terms of
the group annuity contract.

	 	(d)	 	The Company (or its delegate) shall have the sole responsibility to appoint and
remove the Trustee and any successor trustee, and enter into and from time to time
amend the Trust Agreement; to appoint or remove the Plan Administrator and review the
operation and performance of such Plan Administrators; and to establish or alter the
funding and investment policy guidelines for the Plan;

 

33

 

	 	(e)	 	The Plan Administrator shall have the sole responsibility to monitor the
performance and operations of the Trustee, any Insurance Company and
any investment manager; to implement the funding and investment policy guidelines
established by the Company (or its delegate); to advise the Company (or its
delegate) with respect to the appointment or removal of the Trustee and the
continuation or alteration of the investment and funding policy guidelines of Plan A
and Plan B; to appoint, remove, or allocate the assets of the Fund among one or more
investment managers (within the meaning of section 3(38) of ERISA) or Insurance
Companies in accordance with the funding and investment policy guidelines
established by the Company (or its delegate) and the terms of the Trust Agreement;
and to exercise such other powers and duties with respect to the assets of each Fund
as are delegated to the Plan Administrator under the terms of the Trust Agreement or
as are otherwise necessary or appropriate to carry out its responsibilities
described above.

	 	(f)	 	Except as otherwise specifically provided herein or in the Trust Agreement or
in a group annuity contract, the general administration of Plan A and Plan B and the
responsibility for carrying out its provisions shall be vested solely in the Plan
Administrator. In addition, the Plan Administrator shall have such powers and
responsibilities as are hereinafter specifically provided.

	10.2	 	Appointment of the Members of the Administrative Committee. The Company may appoint
a committee (hereafter referred to as the “Administrative Committee”) to
administer the Plan which shall consist of one or more individuals as appointed from time
to time by the Company (or its delegate). The membership of the Administrative
Committee may include individuals who are not covered by Plan A or Plan B. The Company (or its
delegate) may remove any member of the Administrative Committee at any time in its sole
discretion, and any member may resign by delivering to the Company (or its delegate) his
written resignation, effective upon its delivery or at any later date specified therein. The
remaining member or members of the Administrative Committee shall continue to act until any
vacancy in the membership of such committee is filled by action of the Company (or its
delegate).

	10.3	 	Organization and Operation of the Administrative Committee. If established, the
Administrative Committee shall appoint from among its members a chairman. The chairman, when
present, shall preside at meetings of the Administrative Committee. In his absence, those
present will choose one of their members to act as chairman. The Administrative Committee
shall appoint a secretary, who shall keep the minutes of the meetings and perform such other
duties as may be assigned to him by the Administrative Committee. The secretary may, but need
not, be a member of the Administrative Committee or a Member of the Plan. The Administrative
Committee shall act either at any meetings or through a writing without such a meeting by an
agreement of the majority of the members of the Administrative Committee then in office, and
the action of such majority shall have the same effect for all purposes as if assented to by
all members of that
Administrative Committee. Any member of the Administrative Committee who is a Member of the
Plan shall not vote on any question relating exclusively to himself. The Administrative
Committee may authorize one or more of its members to execute documents on behalf of that
Administrative Committee.

Any act which the Plan, the Trust Agreement or a group annuity contract authorizes or
requires the Administrative Committee to do may be specifically delegated in writing to one
or more members of that Administrative Committee.

 

34

 

	10.4	 	Powers and Duties of the Plan Administrator. The Plan Administrator shall control the
management, operation and administration of the Plan. The powers and duties of the Plan
Administrator shall include but not be limited to the following:

	 	(a)	 	Construe and interpret Plan A and Plan B in accordance with uniform rules and
regulations consistently applied to all Members.

	 	(b)	 	Decide the eligibility of any persons to be covered under Plan A or Plan B, in
accordance with the provisions of each such plan.

	 	(c)	 	Determine the right of any person to a Retirement Benefit, in accordance with
the provisions of Plan A or Plan B.

	 	(d)	 	Prescribe procedures to be followed by Members in filing applications for
Retirement Benefits.

	 	(e)	 	Issue instructions to the Trustee or Insurance Company in connection with all
Retirement Benefits which are to be paid in accordance with the provisions of Plan A and
Plan B.

	 	(f)	 	Require from the Company and Employees such information as is necessary
to properly administer Plan A and Plan B.

	 	(g)	 	Furnish to the Company (or its delegate) appropriate periodic reports covering
the administration of Plan A and Plan B.

	 	(h)	 	Receive and review periodic accounting of benefit payments made by the
Trustee and/or Insurance Company.

	10.5	 	Accounts and Records. The Company (or its delegate) shall maintain records showing
the separate fiscal operations of Plan A and Plan B and shall keep in convenient form such
data as may be necessary for periodic actuarial valuations of the costs, liabilities, and
experience gains and losses of each such plan.

The Company (or its delegate) shall prepare annually a report showing in detail the
separate assets and liabilities of Plan A and Plan B and giving a brief account
of the operation of the Plan for the past year. Such report shall be submitted to the
Board and shall be filed in the office of the secretary of the Board.

 

35

 

	10.6	 	Employment of Specialists. The Company (or its delegate) shall have the authority to
employ advisors such as attorneys (who may but need not be attorneys to the Company) or such
other persons as it deems necessary or desirable to provide advice and services to it.

	10.7	 	Claims and Review Procedures.

	 	(a)	 	Claims procedure. If any person believes he is being denied any rights
or benefits under the Plan, such person may file a claim in writing with the Plan
Administrator. If any such claim is wholly or partially denied, the Plan Administrator
will notify such person of its decision in writing. Such notification will contain
(i) specific reasons for the denial, (ii) specific reference to pertinent plan
provisions, (iii) a description of any additional material or information necessary for
such person to perfect such claim and an explanation of why such material or
information is necessary and (iv) information as to the steps to be taken if the person
wishes to submit a request for review. Such notification will be given within 90 days
after the claim is received by the Plan Administrator (or within 180 days, if special
circumstances require an extension of time for processing the claim, and if written
notice of such extension and circumstances is given to person within the initial 90 day
period). If such notification is not given within such period, the claim will be
considered denied as of the last day of such period and such person may request a
review of his claim.

	 	(b)	 	Review procedure. Within 60 days after the date on which a person
receives written notice of a denied claim (or, if applicable, within 60 days after the
date on which such denial is considered to have occurred) such person (or his duly
authorized representative) may (i) file a written request with the Plan Administrator
for a review of his denied claim and of pertinent documents and (ii) submit written
issues and comments to the Plan Administrator. The Plan Administrator will notify such
person of its decision in writing. Such notification will be written in a manner
calculated to be understood by such person and will contain specific reasons for the
decision as well as specific references to pertinent Plan provisions. The decision on
review will be made within 60 days after the request for review is received by the
Plan Administrator (or within 120 days, if special circumstances require an extension
of time for processing the request, such as an election by the Plan Administrator to
hold a hearing, and if written notice of such extension and circumstances is given to
such person within the initial 60 day period). If the decision on review is not made
within such period, the claim will be considered denied.

	 	(c)	 	Notwithstanding the foregoing, the Plan shall comply with any subsequent claims
and appeals regulations to the extent required by law. Effective January 1, 2002,
the Plan’s procedure for denial of claims and for any appeal of such denial for
benefits under the plan shall be set forth in a separate document or in the Summary
Plan Description for this Plan. Such procedures shall comply with ERISA Section 503
and attendant regulations thereunder to the extent required by law.

 

36

 

	10.8	 	Standard of Conduct. Each fiduciary with respect to the Plan shall discharge his
duties to the Plan solely in the interest of Plan Members, surviving Spouses, and
Beneficiaries, with the care, skill, prudence and diligence under the circumstances that a
prudent man acting in a like capacity and familiar with such matters would use in the conduct
of an enterprise of a like character and with like aims and in accordance with provisions of
the Plan, to the extent such provisions are consistent with ERISA.

	10.9	 	Indemnification. The Company shall indemnify and hold harmless the Plan
Administrator including each member of the Administrative Committee, if established,
from any and all claims, losses, damages, expenses (including reasonable counsel fees approved
by the Company), and liability (including any reasonable amount paid in settlement with the
Company’s approval), arising from any act or omissions of such member, except when the same is
judicially determined to be due to the willful misconduct of such member.

	10.10	 	Compensation of Administrative Committee Members. The members of the Administrative
Committee shall serve without compensation with respect to their position on the
Administrative Committee. All reasonable expenses of the Administrative Committee shall be
paid for by the Company.

	10.11	 	Actions to be Uniform. Any discretionary actions to be taken under Plan A or Plan B
will be nondiscriminatory and uniform with respect to all persons similarly situated.

	10.12	 	Effect of Interpretation or Determination. Any interpretation of Plan A or Plan B or
other determination with respect to such plan by the Plan Administrator will be final and
conclusive for all persons in the absence of clear and convincing evidence that the Plan
Administrator acted arbitrarily and capriciously.

	10.13	 	Withholding of Tax. Unless the Plan Administrator otherwise directs the Trustee or
the Insurance Company pursuant to the second sentence of this Section, the Plan Administrator
will be responsible for withholding any and all amounts required by the Code and applicable
regulations to be withheld upon distributions from the Plan. The Plan Administrator may elect
to transfer this responsibility to the Trustee or an Insurance Company, whichever is the payor
with respect to the distribution in question, by directing said payor, in the manner
prescribed by applicable law and regulations, to withhold the aforesaid amounts.

 

37

 

ARTICLE 11

AMENDMENT AND TERMINATION

	11.1	 	Right to Amend. Except as provided in Section 11.3, the Company reserves the right at
any time and from time to time to amend Plan A and Plan B by written instrument authorized by
the Board, executed by the Company and delivered to the Administrative Committee; provided,
however, that no amendment shall be made, which would, without written consent of the Trustee,
increase the duties or liabilities of the Trustee; and provided, further, that no
amendment shall adversely affect the amount of any Member’s Retirement Benefit based on his
Years of Vesting Service and membership in such plan prior to the date of the amendment, or
decrease his accrued benefit (within the meaning of section 411(d)(6) of the Code) as of the
date of the amendment, unless the amendment is necessary or appropriate to enable such plan or
trust to qualify or retain its qualified status under section 401 of the Code and under any
corresponding section of the Code as hereinafter enacted. Notwithstanding the above, the
Administrative Committee may adopt amendments as necessary to bring Plan A and Plan B into
conformity with legal requirements, or to improve the administration hereof,
provided no such amendments cause a substantial adverse financial effect upon the Company
or the Plan. Notwithstanding the foregoing, the Company may delegate its authority to amend
the Plan to the Plan Administrator with respect to amendments that are administrative in
nature.

	11.2	 	Right to Terminate. Neither the making of contributions nor the continuance of the
Plan is assumed by the Company as a contractual obligation except as provided in Section 11.3.
The Company reserves the right at any time to suspend its contributions, for such period as
the Board may determine, and reserves the right at any time by action of the Board,
communicated in writing by the Company to the Plan Administrator, the Trustee and an Insurance
Company, to terminate its contributions or to terminate Plan A or Plan B.

	11.3	 	Amendments or Termination Affecting Union Members. Notwithstanding the
provisions of this Article 11, no termination, change or amendment to Plan B which affects the
rights and obligations of Union Members, shall be made on or before the expiration date of the
collective bargaining agreement except with the agreement of the Utility Workers Union of
America, AFL-CIO, Local 369.

	11.4	 	Nonforfeitable Benefits. In the event Plan A or Plan B shall be terminated, or upon
termination of employment of a group of Members constituting a partial termination of such
plan, each such Member’s rights shall become nonforfeitable to the extent funded or as
guaranteed by the Pension Benefit Guaranty Corporation.

 

38

 

	11.5	 	Satisfaction of Liabilities. In the event, at any time, Plan A or Plan B shall be
terminated, the assets of the related Fund, after providing for necessary
expenses, shall be allocated to each covered Member, surviving Spouse, or Beneficiary
entitled to a Retirement Benefit in accordance with and subject to the order of precedence
and rules set forth in section 4044 (a) and (b) of ERISA and the regulations thereunder
issued by the Pension Benefit Guaranty Corporation. If any assets remain in the respective
Fund after all such allocations, such assets shall be returned to the Company. Payment of
such allocations may be accomplished, as determined by the Plan Administrator, by:

	 	(a)	 	continuance of the Fund; or

	 	(b)	 	continuance of that portion of the Fund held by the Trustee under the Trust
Agreement or establishment of a new trust fund; or

	 	(c)	 	continuance of that portion of the Fund held by an Insurance Company under a group
annuity contract or establishment of a new fund (subject to the terms and conditions of the
group annuity contract) under a new group annuity contract; or

	 	(d)	 	purchase of annuity contracts from an Insurance Company;

provided, however that if with respect to any allocation groups, it is not, in the opinion
of the Plan Administrator, practicable or desirable to do any of the foregoing with respect
to such group or groups, the Plan Administrator may provide for the payment of the
allocation for such group or groups in a manner other than by any of the foregoing methods
of payment.

ARTICLE 12

GENERAL PROVISIONS

	12.1	 	Rights to Benefits. No person shall have any right or claim to a benefit under the
Plan beyond that expressly provided by the Plan and then only to the extent of the assets
available in the Fund which may be applied for his benefit in accordance with the Plan unless
guaranteed by the Pension Benefit Guaranty Corporation.

	12.2	 	Company Rights. The establishment and maintenance of the Plan shall not be construed
to give any Employee the right to be retained in the service of the Company. The contributions
of the Company to the Fund shall be for the exclusive benefit of Members and persons claiming
through them, and no part of the Fund shall revert to the Company other than such residual
amount as remains in the Fund after termination of the Plan and the satisfaction of all
obligations to all Members and Beneficiaries under the Plan.

	12.3	 	Construction. The provisions of this Plan shall be construed, administered and
enforced according to the provisions of ERISA and, to the extent not preempted thereby, the laws of
the State of Delaware.

 

39

 

	12.4	 	 Titles. The titles of the Sections herein are included for convenience of
reference only and shall not be construed as a part of this Plan, nor have any effect upon
the meaning of the provisions hereof. Unless the context requires otherwise, the singular
shall include the plural; the masculine gender shall include the feminine; the feminine
gender shall include the masculine; and such words as “herein”, “hereafter”, “hereof” and
“hereunder” shall refer to this instrument as a whole and not merely to the subdivision in
which such words appear.

	12.5	 	Impossibility of Action. In case it becomes impossible for any fiduciary to perform
any act under this Plan, that act shall be performed which in the judgment of such fiduciary
will most nearly carry out the intent and purposes of this Plan. All parties concerned shall
be bound by any such acts performed under such conditions.

	12.6	 	Separability. If any term or provision of this Plan as presently in effect or as
amended from time to time, or the application thereof to any payments or circumstances, shall
to any extent be invalid or unenforceable, the remainder of the Plan, and the application
of such term or provision to payments or circumstances other than those as to which it is
invalid or unenforceable, shall not be affected thereby, and each term or provision of the
Plan shall be valid and enforced to the fullest extent permitted by law.

	12.7	 	Merger or Consolidation of Plan. Plan A or Plan B shall not merge or consolidate
with, or transfer or segregate its assets or liabilities to, any other plan unless each Member
of such plan would, if the successor plan were then to be terminated, be entitled to a
Retirement Benefit immediately after the merger, consolidation, transfer, or segregation which
is equal to or greater than the Retirement Benefit he would have been entitled to immediately
before the merger, consolidation, transfer or segregation, if Plan A or Plan B had then been
terminated.

	12.8	 	Latest Commencement of Benefits. In no case will the payment of benefits to any
Member commence later than the earlier of:

	 	(a)	 	unless the Member otherwise elects, the sixtieth (60th) day after the
latest of the following:

	 	(i)	 	the close of the Plan Year in which occurs the date on
which the Member attains age sixty-five (65),

	 	(ii)	 	the close of the Plan Year in which occurs the tenth (10th) anniversary of the
year in which the Member commenced participation in the Plan or

 

40

 

	 	(iii)	 	the close of the Plan Year in which the Member terminates his
service with the Company, or

	 	(b)	 	the April 1 of the calendar year following the later of:

	 	(i)	 	the calendar year in which the Member attains age 701/2, or

	 
	 	(ii)	 	the calendar year in which the Member retires.

	12.9	 	Veterans’ Reemployment Rights. Notwithstanding any provision of the Plan to the
contrary, benefits and service credits with respect to qualified military service will be
provided in accordance with Code Section 414(u).

	12.10	 	Separate Plans and Assets. Plan B assets (those available to pay benefits that
accrue on behalf of Union Members) shall be available only for such purpose and shall not be
available under any circumstances to pay benefits with respect to any Member who is not a
Union Member. Furthermore, Plan A assets (those available to pay benefits that accrue on
behalf of Members who are not Union Members) shall be available only for such purpose and
shall not be available under any circumstances to pay benefits with respect to any Union
Member. For Trust accounting purposes, all of Plan A assets shall at all times be accounted
for separately from all of Plan B assets in a manner which satisfies Treas. Reg. Sec.
1.414(l)-1(b)(8). Plan A and Plan B shall constitute separate plans.

ARTICLE 13

TOP HEAVY

	13.1	 	Purpose and Applicability. The provisions of this Article are intended to comply
with, and all determinations under this Article will be computed in accordance with, section
416 of the Code and the regulations promulgated thereunder, which are specifically
incorporated herein by reference. The provisions of Sections 13.2, 13.3, and 13.4 below shall
not apply with respect to any Employee covered by a collective bargaining agreement as to
which retirement benefits were the subject of good-faith bargaining, unless such agreement
provides for the application of such provisions to such Employees. Accordingly, this Article
only applies to Plan A which does not cover Union Members.

 

41

 

	13.2	 	Special Vesting. Notwithstanding any other provision of the Plan, other than the
provisions of this Article, each individual who is a Member at any time during a Plan Year
which is a top heavy plan year shall have a fully vested and nonforfeitable interest in not
less than a percentage of his Accrued Benefit as set forth in the following schedule, based on
his completed Years of Vesting Service:

	 	 	 	 	 
	Years of	 	Nonforfeitable	 
	Vesting Service	 	Percentage	 
	 
	 	 	 	 
	Less than 3
	 	 	0	%
	3 or more
	 	 	100	%

In the event any Plan Year subsequent to a top heavy plan year is not itself a top heavy
plan year, the foregoing special vesting schedule shall apply to benefits accrued through
the close of the last Plan Year which was a top heavy plan year and, in the case of any
Member who had completed three or more Years of Vesting Service or as of the close of the
last such top heavy plan year, to benefits accrued in any Plan Year subsequent to the last
such top heavy plan year.

	13.3	 	Minimum Benefits. The benefit payable at any time to each Member who is not a key
employee and who completes at least 1,000 Hours of Service in a Plan Year which is a top
heavy plan year, determined as of the end of such Plan Year (and as of the end of any
subsequent Plan Year) and when expressed as an annual benefit payable as a single life
annuity commencing at the Member’s Normal Retirement Date, shall not be less than the lesser
of

	 	(a)	 	the product of (i) two percent of the Member’s high five year compensation and
(ii) the number of his years of service for minimum benefit purposes (excluding any
such year that was not a top heavy plan year), and

	 	(b)	 	twenty percent of his high five year compensation;

provided, that in the case of any Member who is also a member in a defined contribution
plan or plans maintained by the Company or an Affiliated Company, the additional benefit
accrual required under this Section shall not exceed an amount which, when considered
together with company contributions allocated to the Member’s accounts under such other
plan or plans, would satisfy such requirements as the Secretary of the Treasury may
prescribe, pursuant to section 416(f) of the Code, to prevent duplication of benefits. If
payment of the Member’s benefit under the Plan is suspended in circumstances in which, but
for section 411(a)(3)(B) of the Code and section 203 (a)(3)(B) of ERISA, such suspension
would constitute a forfeiture of benefits, the minimum benefit described above, to the
extent affected by such suspension, shall be actuarially increased (using the assumptions
used in determining an Actuarial Equivalent benefit) to reflect such period of suspension.

 

42

 

	13.4	 	Definitions. For purposes of this Article:

	 	(a)	 	“Compensation” means the Member’s wages, salaries, fees
for professional services and other amounts received for personal services
actually rendered in the course of employment with the Company, including amounts (if any)
by which the Member’s compensation is reduced pursuant to an election under a cash or
deferred arrangement described in section 401(k) of the Code, that is part of a plan
maintained by the Company, or a cafeteria plan maintained by the Company under section 125
of the Code, but does not include any other amounts which are excluded under the
definition of compensation provided in the Treasury Regulations promulgated under section
415 of the Code; provided that compensation for a Plan Year in excess of the amount in
effect for a Plan Year under section 401(a)(17) of the Code) will be disregarded under the
Plan in accordance with the rules under section 401(a)(17) of the Code.

	 	(b)	 	“High five year compensation” means the average of the Member’s annual compensation for those
five consecutive years of service for minimum benefit purposes (or, if the Member has less
than five such years, then for his number of consecutive years of service for minimum benefit
purposes) for which his aggregate compensation is greatest. Any Plan Year which is not a year
of service for minimum benefit purposes shall be ignored in determining whether the Member’s
years of service for minimum benefit purposes are consecutive.

	 	(c)	 	“Key employee” means 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
Company having annual compensation greater than $130,000 (as adjusted under Section 416(i)(1)
of the Code for Plan Years beginning after December 31, 2002), a five-percent owner of the
Company, or a one-percent owner of the Company having annual compensation of more than
$150,000. For this purpose, annual compensation means compensation within the
meaning of Section 415(c)(3) of the Code. 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.

 

43

 

	 	(d)	 	“Top heavy plan year” means a Plan Year in which the sum of the present values of the total
accrued benefits of all key employees under the Plan and under each other defined
benefit plan (as of the applicable determination date of each such plan) which is
aggregated with this Plan, plus the sum of the account balances of all key employees under
each defined contribution plan (as of the applicable determination date of each such plan)
which is aggregated with this Plan, exceeds sixty percent of the sum of such amounts for all
Employees or former Employees (other than former key employees but including beneficiaries of
deceased former Employees) under such plans. The following rules shall apply for purposes of
making the foregoing determination:

	 	(i)	 	The term “determination date” means, with respect to the initial plan year of a plan,
the last day of such plan year and, with respect to any other plan year of a plan, the
last day of the preceding plan year of such plan. The term “applicable determination
date” means, with respect to the Plan, the determination date for the Plan Year of
reference and, with respect to any other plan, the determination date for any plan year
of such plan which falls within the same calendar year as the applicable determination
date of the Plan.

	 	(ii)	 	The present values of accrued benefits or account balances under a plan as of the
determination date shall be increased by the distributions made with respect to the Employee
under the Plan and any plan aggregated with the Plan under Section 416(g)(2) of the Code
during the 1-year period ending on the determination date. The preceding sentence shall also
apply to 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. In the case of a
distribution made for a reason other than separation from service, death, or disability, this
provision shall be applied by substituting ‘5-year period’ for ‘1-year period’. The accrued
benefits and account balances of any individual who has not performed services for the
Company during the 1-year period ending on the determination date shall not be taken into
account. In the case of a defined benefit plan, such valuation date must be the same date as
is employed for computing plan costs for minimum funding purposes, and the determination of
the present value of accrued benefits shall be made on the basis of reasonable interest and
mortality assumptions, including without limitation those used for minimum funding purposes
or for purposes of determining the actuarial equivalence of optional benefits under the plan.
In the case of a defined contribution plan, the value of account balances will be adjusted
for contributions made after the valuation date to the extent required by applicable Treasury
regulations.

	 	(iii)	 	There shall be aggregated with this Plan: (A) any other plan of the Company or an
Affiliated Company under which at least one key employee participates and which is able to
satisfy the requirements of sections 401(a)(4) and 410 of the Code by reason, at least in
part, of the existence of this Plan, and (B) if at least one key employee is a Member
hereunder, any other plan of the Company or an Affiliated Company (i) in which a key employee
participates or (ii) which enables another such plan (including, but not limited to, the
Plan) to satisfy the requirements of sections 401(a)(4) and 410 of the Code. Any plan of the
Company or an Affiliated Company not required to be aggregated with the Plan may
nevertheless, in the
discretion of the Administrative Committee, be aggregated with the Plan if
the benefits and coverage of all aggregated plans would continue to satisfy
the requirements of sections 401(a)(4) and 410 of the Code.

 

44

 

	 	(e)	 	“Year of service for minimum benefit purposes” means, with respect to any
Member, each Plan Year in which the Member completes at least 1,000 Hours of Service
except any such year which begins after the last day of the most recent Plan Year
which was a top heavy plan year. For purposes of satisfying the minimum benefit
provisions of Section 416(c)(1) of the Code, in determining years of minimum benefit
service, any service with the Company shall be disregarded to the extent that such
service occurs during a Plan Year when the Plan benefits (within the meaning of
Section 410(b) of the Code) no Key Employee or former Key Employee.

	13.5	 	Adjustment to Benefit Limitations. In applying the limitations of Section 4.7 for
any Plan Year which begins prior to January 1, 2000 which is a top heavy plan year, Code
section 415(e)(2)(B) and (3)(B) will be applied by substituting “1.0” for “1.25” wherever
“1.25” appears therein unless (a) the Plan and each plan with which the Plan is required to
be aggregated pursuant to the first sentence of Section 13.4.(d)(iii) satisfies the
requirements of section 416(h)(2)(A) of the Code, and (b) such Plan Year would not be a top
heavy plan year if “ninety percent” were substituted for “sixty percent” in the first
paragraph of Section 13.4(d).

IN WITNESS WHEREOF, Sithe Energies, Inc. have caused this instrument to be duly executed in its
name and behalf on this 29th day of January, 2007.

	 	 	 	 	 
	 

	 	SITHE ENERGIES, INC.
	 
	 	 	 	 
	 

	 	By:
	 	/s/ [ILLEGIBLE]
 
 

 

45

 

APPENDIX A

SPECIAL PROVISIONS FOR FORMER GPU REPRESENTED EMPLOYEES

ARTICLE A1

PURPOSE AND APPLICABILITY

This Appendix A exists solely for a historical reference. Effective May 12, 2000, Sithe Energies,
Inc. sold certain of its operating facilities described below to Reliant Energy. As a result of
the transaction, Reliant Energy assumed the existing collective bargaining agreements with the
unions and agreed to continue to provide pension benefits pursuant to such collective bargaining
agreements. Furthermore, Reliant Enemy agreed to the transfer of the assets and liabilities
attributable to the employees covered at such operating facilities from this Plan to a plan
sponsored by Reliant Energy and the Plan was amended to delete the following provisions. Sithe
Energies, Inc. is no longer liable for any benefits relating to the former employees described
below.

	A1.1	 	Purpose and Applicability. Effective November 24, 1999 (the “Closing Date”), Sithe
Energies, Inc. acquired the fossil fuel and hydroelectric generating assets of GPU, Inc and
its operating subsidiaries (collectively “GPU”). As a result of such transaction, certain
operating companies of Sithe Energies, Inc. assumed existing collective bargaining agreements
with certain unions and have agreed to continue to provide pension benefits pursuant to such
collective bargaining agreements and other agreements between and among Sithe Energies, Inc.
and its operating companies, GPU, and the respective unions. Such pension benefits had
previously been provided under the applicable union pension plans sponsored by GPU (“GPU
Plans”).

Accordingly, notwithstanding any provision of the Plan to the contrary, the purpose of
this Appendix A is to describe the pension benefits that accrued for such covered union
groups and to incorporate by reference certain substantive provisions of the GPU Plans as
indicated below. To the extent GPU Plan provisions are not incorporated by reference, as
indicated below, the provisions of this Plan shall apply.

All assets available to pay pension benefits with respect to Members that accrue pursuant
to the terms and provisions of Articles A2, A3 or A4 of this Appendix A (the “Appendix A
Portion of the Plan”) shall be available only for such purpose and shall not be available
under any circumstances to pay pension benefits with respect to any Union Member covered by
Plan B.

In no event shall this Plan be liable for any benefits accrued under the GPU Plans. By
adopting the following incorporations by reference, Sithe Energies, Inc. and its operating
companies do not become sponsors of or parties to any GPU Plan.

As described below, benefits provided under this Appendix A shall be based solely on
service with the Participating Company from the Closing Date to May 12, 2000.

 

46

 

	A1.2	 	 Participating Company. Notwithstanding any other section of the Plan to the
contrary, “Eligible Employee” shall include any Employee of a Participating Company.
Participating Company means the Company and any other Affiliated Company which adopts this
Plan with the approval of the Company. Effective November 24, 1999, solely for purposes of
the Appendix A Portion of the Plan, the Participating Companies shall include Sithe
Pennsylvania Holdings, LLC; Sithe Maryland Holdings, LLC; Sithe New Jersey Holdings, LLC; and
Sithe Northeast Management Company.

	A1.3	 	 Plan Assets. Notwithstanding anything in the Plan to the contrary, for Trust
accounting purposes, all of the assets subject to the Appendix A Portion of the Plan shall be
part of Plan A and at all times be accounted for separately from all of the Plan B assets in
a manner which satisfies Treas. Reg. Sec. 1.414(l)-l(b)(8).

ARTICLE A2

JERSEY PLAN COVERED GROUP PROVISIONS

Except as hereinafter provided, the Plan hereby incorporates by reference the benefit provisions
of the Jersey Central Power & Light Company Plan for Retirement Annuities as in effect on the
Closing Date (the “Jersey Plan”) but by replacing any reference to GPU Companies with Affiliated
Company as defined herein. Accordingly, except as modified below, a Jersey Plan Eligible Employee
shall accrue benefits as if such individual participated in the Jersey Plan based on service
credited hereunder after the Closing Date through May 12, 2000.

	A2.1 	 	Jersey Plan Eligible Employee. Any Eligible Employee of a Participating Company who
is covered under a collective bargaining agreement between Sithe New Jersey Holdings LLC,
Sithe Mid-Atlantic Power Services, Inc. and Local Unions 327, 1289, and 1314 of the
International Brotherhood of Electrical Workers AFL-CIO, is a member of the Jersey Plan
Covered Group. Each Eligible Employee of the Jersey Plan Covered Group shall become an active
Member of the Plan under this Article A2 upon the Closing Date if such individual was an
active participant in the Jersey Plan immediately prior to the Closing Date. Otherwise, such
individual shall become a Member hereunder upon satisfying the eligibility conditions of the
Jersey Plan.

	A2.2	 	 Creditable Service. In general, Creditable Service under this Plan shall not include
service prior to the Closing Date nor after May 12, 2000. However, for a Jersey Plan Eligible
Employee who was an active participant in the Jersey Plan
immediately prior to the Closing Date, Creditable Service under this Plan will be measured
from the individual’s last anniversary date of his or her employment with GPU prior to
November 24, 1999 if such anniversary date is between May
24, 1999 and November 24, 1999 and the individual was not credited with a full year of
benefit service under the Jersey Plan for the last fractional year of employment.
Notwithstanding anything to the contrary, no individual will receive duplicate service
under both the Jersey Plan and this Plan.

 

47

 

	A2.3	 	 Vesting Service. Vesting Service shall be determined in the same manner as provided
in the Jersey Plan. Furthermore, vesting service credited under the Jersey Plan, if any,
shall be recognized as Vesting Service for purposes of this Plan. However, in no event will a
Member receive duplicate vesting service for service credited under both the Jersey Plan and
this Plan.

	A2.4	 	 Creditable Service for Determination of Basic Annuity. In determining a Member’s
Basic Annuity, a Member’s number of years of creditable service credited under the Jersey
Plan, if any, shall be taken into account hereunder solely for the purpose of determining the
appropriate accrual percentage to be multiplied by the Member’s Basic Earnings.

	A2.5	 	 Service for All Other Purposes. For purposes of determining eligibility to
participate under this Article, eligibility for an early or normal retirement benefit, or for
any purpose other than as described above, service for such purpose credited to a Member
under the Jersey Plan, if any, shall be taken into account for such purpose under this Plan.
However, in no event will a Member receive duplicate service for service credited under both
the Jersey Plan and this Plan.

	A2.6	 	 Basic Earnings. For purposes of determining a Member’s Basic Earnings under this
Plan, earning under the Jersey Plan prior to the Closing Date, if any shall be taken into
account.

	A2.7	 	 Inapplicable Jersey Plan Provisions. The provisions of the Jersey Plan which are
administrative in nature, do not otherwise relate to determining an individual’s benefit,
which relate to employee contributions, or for which there is a substantially similar
provision in this Plan shall not apply hereunder. Accordingly, notwithstanding any provision
herein to the contrary, the following Sections of the Jersey Plan shall not apply hereunder
and are excluded from incorporation in this Plan:

Foreword;

Section 4 (Transfers);

Section 7 (Determination of Additional Annuities);

Section 8 (Rights of Beneficiaries);

Section 11 (Payment of Annuities);

Section 12 (Financing the Plan);

Section 13 (Retirement Annuity Fund);

Section 14 (Administration of the Plan);

Section 15 (Rights of Retired Employees);

Section 16 (Consolidation, Merger, or Sale of Property);

Section 17 (Amendment or Termination of the Plan);

Section 18 (Limit of Benefit From Retirement Annuity Fund);

Section 19 (Other Limitations of Certain Benefits Payable);

Section 20 (Miscellaneous); and

Section 21 (1996 Voluntary Enhanced Retirement Program).

In addition any Plan provision which is required to maintain the Plan’s qualification
status under Section 401(a) of the Code shall supersede any contrary provision of the
Jersey Plan.

 

48

 

ARTICLE A3

METROPOLITAN PLAN COVERED GROUP PROVISIONS

Except as hereinafter provided, the Plan hereby incorporates by reference the benefit provisions
of the Metropolitan Edison Company Plan for Retirement Annuities as in effect on the Closing Date
(the “Metropolitan Plan”) but by replacing any reference to GPU Companies with Affiliated Company
as defined herein. Accordingly, except as modified below, a Metropolitan Plan Eligible Employee
shall accrue benefits as if such individual participated in the Metropolitan Plan based on service
credited hereunder after the Closing Date through May 12, 2000.

	A3.1 	 	Metropolitan Plan Eligible Employee. Any Eligible Employee of a Participating
Company who is covered under a collective bargaining agreement between Sithe Pennsylvania
Holdings LLC, Sithe Mid-Atlantic Power Services, Inc. and Local Union 777 of the
International Brotherhood of Electrical Workers AFL-CIO, is a member of the Metropolitan Plan
Covered Group. Each Eligible Employee of the Metropolitan Plan Covered Group shall become an
active Member of the Plan under this Article A3 upon the Closing Date if such individual was
an active participant in the Metropolitan Plan immediately prior to the Closing Date.
Otherwise, such individual shall become a Member hereunder upon satisfying the eligibility
conditions of the Metropolitan Plan.

	A3.2 	 	Creditable Service. In general, Creditable Service under this Plan shall not include
service prior to the Closing Date nor after May 12, 2000. However, for a Metropolitan Plan
Eligible Employee who was an active participant in the Metropolitan Plan immediately prior to
the Closing Date, Creditable Service under this Plan will be measured from the individual’s
last anniversary date of his or her employment with GPU prior to November 24, 1999 if such
anniversary date is between May 24, 1999 and November 24, 1999 and the individual was not
credited with a full year of benefit service under the Metropolitan Plan for the last
fractional year of employment. Notwithstanding anything to the contrary, no individual will
receive duplicate service under both the Metropolitan Plan and this Plan.

	A3.3	 	 Vesting Service. Vesting Service shall be determined in the same manner as provided
in the Metropolitan Plan. Furthermore, vesting service credited under
the Metropolitan Plan, if any, shall be recognized as Vesting Service for purposes of this
Plan. However, in no event will a Member receive duplicate vesting service for service
credited under both the Metropolitan Plan and this Plan.

 

49

 

	A3.4	 	Creditable Service for Determination of Basic Annuity. In determining a Member’s
Basic Annuity; a Member’s number of years of creditable service credited under the
Metropolitan Plan, if any, shall be taken into account hereunder solely for the purpose of
determining the appropriate accrual percentage to be multiplied by the Member’s Basic
Earnings.

	A3.5	 	 Service for All Other Purposes. For purposes of determining eligibility to
participate under this Article, eligibility for an early or normal retirement benefit, or for
any purpose other than as described above, service for such purpose credited to a Member
under the Metropolitan Plan, if any, shall, be taken into account for such purpose under this
Plan. However, in no event will a Member receive duplicate service for service credited under
both the Metropolitan Plan and this Plan.

	A3.6	 	 Basic Earnings. For purposes of determining a Member’s Basic Earnings under this
Plan, earning under the Metropolitan Plan prior to the Closing Date, if any,
shall be taken into account.

	A3.7	 	 Inapplicable Metropolitan Plan Provisions. The provisions of the Metropolitan Plan
which are administrative in nature, do not otherwise relate to determining an individual’s
benefit, which relate to employee contributions, or for which there is a substantially similar
provision in this Plan shall not apply hereunder. Accordingly, notwithstanding any provision
herein to the contrary, the following Sections of the Metropolitan Plan shall not apply
hereunder and are excluded from incorporation in this Plan:

Foreword;

Section 4 (Transfers);

Section 7 (Determination of Additional Annuities);

Section 8 (Rights of Beneficiaries);

Section 11 (Payment of Annuities);

Section 12 (Financing the Plan);

Section 13 (Retirement Annuity Fund);

Section 14 (Administration of the Plan);

Section 15 (Rights of Retired Employees);

Section 16 (Consolidation, Merger, or Sale of Property);

Section 17 (Amendment or Termination of the Plan);

Section 18 (Limit of Benefit From Retirement Annuity Fund);

Section 19 (Other Limitations of Certain Benefits Payable);

Section 20 (Miscellaneous); and

Section 21 (1996 Voluntary Enhanced Retirement Program).

In addition any Plan provision which is required to maintain the Plan’s qualification
status under Section 401(a) of the Code shall supersede any contrary provision of the
Metropolitan Plan.

 

50

 

ARTICLE A4

PENELEC PLAN COVERED GROUP PROVISIONS

Except as hereinafter provided, the Plan hereby incorporates by reference the benefit provisions
of the Pennsylvania Electric Company Plan for Retirement Annuities as in effect on the Closing
Date (the “Penelec Plan”) but by replacing any reference to GPU Companies with Affiliated Company
as defined herein. Accordingly, except as modified below, a Penelec Plan Eligible Employee shall
accrue benefits as if such individual participated in the Penelec Plan based on service credited
hereunder after the Closing Date and through May 12, 2000.

	A4.1	 	 Penelec Plan Eligible Employee. Any Eligible Employee of a Participating Company who
is covered under a collective bargaining agreement between Sithe Pennsylvania Holdings LLC,
Sithe Maryland Holdings LLC, Sithe Mid-Atlantic Power Services, Inc., Sithe Northeast
Management Company and Local Union 459 of the International Brotherhood of Electrical Workers
AFL-CIO (other than those employees who are employed by Sithe Northeast management Company at
Keystone and Conemaugh assets), is a member of the Penelec Plan Covered Group. Each Eligible
Employee of the Penelec Plan Covered Group shall become an active Member of the Plan under
this Article A4 upon the Closing Date if such individual was an active participant in the
Penelec Plan immediately prior to the Closing Date. Otherwise, such individual shall become a
Member hereunder upon satisfying the eligibility conditions of the Penelec Plan.

	A4.2	 	 Creditable Service. In general, Creditable Service under this Plan shall not include
service prior to the Closing Date nor after May 12, 2000. However, for a Penelec Plan
Eligible Employee who was an active participant in the Penelec Plan immediately prior to the
Closing Date, Creditable Service under this Plan will be measured from the individual’s last
anniversary date of his or her employment with GPU prior to November 24, 1999 if such
anniversary date is between May 24, 1999 and November 24, 1999 and the individual was not
credited with a full year of benefit service under the Penelec Plan for the last fractional
year of employment. Notwithstanding anything to the contrary, no individual will receive
duplicate service under both the Penelec Plan and this Plan.

	A4.3	 	 Vesting Service. Vesting Service shall be determined in the same manner as provided
in the Penelec Plan. Furthermore, vesting service credited under the Penelec Plan, if any,
shall be recognized as Vesting Service for purposes of this Plan. However, in no event will a
Member receive duplicate vesting service for service credited under both the Penelec Plan and
this Plan.

 

51

 

	A4.4	 	 Creditable Service for Determination of Basic Annuity. In determining a
Member’s Basic Annuity, a Member’s number of years of creditable service credited under the
Penelec Plan, if any, shall be taken into account hereunder solely for the purpose of
determining the appropriate accrual percentage to be multiplied by the Member’s Basic
Earnings.

	A4.5	 	 Service for All Other Purposes. For purposes of determining eligibility to
participate under this Article, eligibility for an early or normal retirement benefit, or for
any purpose other than as described above, service for such purpose credited to a Member
under the Penelec Plan, if any, shall be taken into account for such purpose under this Plan.
However, in no event will a Member receive duplicate service for service credited under both
the Penelec Plan and this Plan.

	A4.6	 	 Basic Earnings. For purposes of determining a Member’s Basic Earnings under this
Plan, earning under the Penelec Plan prior to the Closing Date, if any shall be taken into
account.

	A4.7	 	 Inapplicable Penelec Plan Provisions. The provisions of the Penelec Plan which are
administrative in nature, do not otherwise relate to determining an individual’s benefit,
which relate to employee contributions, or for which there is a substantially similar
provision in this Plan shall not apply hereunder. Accordingly, notwithstanding any provision
herein to the contrary, the following Sections of the Penelec Plan shall not apply hereunder
and are excluded from incorporation in this Plan:

Foreword;

Section 4 (Transfers);

Section 7 (Determination of Additional Annuity);

Section 8 (Rights of Beneficiaries);

Section 11 (Payment of Annuities);

Section 12 (Financing the Plan);

Section 13 (Retirement Annuity Fund);

Section 14 (Administration of the Plan);

Section. 15 (Rights of Retired Employees);

Section 16 (Consolidation, Merger, or Sale of Property);

Section 17 (Amendment or Termination of the Plan);

Section 18 (Limit of Benefit From Retirement Annuity Fund);

Section 19 (Other Limitations of Certain Benefits Payable);

Section 20 (Miscellaneous); and

Section 21. (1996 Voluntary Enhanced Retirement Program).

In addition any Plan provision which is required to maintain the Plan’s qualification
status under Section 401(a) of the Code shall supersede any contrary provision of the
Penelec Plan.

 

52

 

APPENDIX B

MODIFIED TRADITIONAL PENSION PLAN FOR CERTAIN UNION MEMBERS

ARTICLE B1

INTRODUCTION

This Appendix B shall exist solely for historical reference. Effective October 31, 2002, Sithe
Energies, Inc. sold Sithe New England Power Services, Inc. to Exelon. As a result of the
transaction, Exelon assumed the assets and liabilities of the Sithe Union Employees Pension Plan.
On and after November 1, 2002, Sithe Energies, Inc. shall no longer be liable for any benefits
relating to former employees who were covered under the Sithe Union Employees Pension Plan as
described in the further provisions of this Appendix B, and the Plan is hereby amended
accordingly, to delete the following provisions.

This Appendix B contains the modified traditional pension plan provisions which prior to January
1, 2001 constituted the main body of the Sithe Energies Group Pension Plan, originally effective
May 16, 1998. All Union Members who accrue benefits under Appendix B (instead of under the cash
balance provisions of the Plan document) are referred to as “Appendix B Members”. Notwithstanding
any other provision to the contrary, there will be no new Appendix B Members after January 1,
2001. These provisions and all those found in the body of the Plan that apply to Union Employees
are collectively a continuation of the Sithe Energies Group Pension Plan, and effective January 1,
2001 are known as the Sithe Union Employees Pension Plan referred to herein as Plan B.

All provisions of the main Plan document apply to Appendix B Members except the following:

Plan Article Sections Inapplicable to Appendix B Members

Article 1: Section 1.1

Section 1.2

Section 1.4

Section 1.6

Section 1.8

Section 1.11

Section 1.13

Section 1.14

Section 1.15

Section 1.16

Section 1.22

Section 1.23

Section 1.24

Section 1.25

Section 1.26

Section 1.29

Section 1.30

Section 1.31

Section 1.35

Section 1.36

Section 1.37

 

53

 

Definitions in the body of the main Plan document that are superceded by definitions in this
Appendix B.

Article 2: Entire Article

Article 3: Entire Article

Article 4: Section 4.1

Section 4.2

Section 4.4

Article 5: Entire Article

Article 6: Entire Article

Article 7: Entire Article

Article 13: Entire Article

ARTICLE B2

DEFINITIONS OTHER THAN SERVICE DEFINITIONS

	B2.1	 	 “Accumulated Member Contributions”, as of any specified time, means the sum of all
contributions made by a Member under this Plan which have not been withdrawn, with interest
credited on such amounts, for each Plan Year or portion thereof at the rate of 120 percent of
the Federal mid-term rate as in effect under section 1274 of the Code for the first month of
such Plan Year. Interest shall be computed on each contribution from the January 1 next
following the date such contribution was due to the earlier of:

	 	(a)	 	the first day of the month in which the Member commences to receive
Retirement Benefit payments, attains his Normal Retirement Date, or
withdraws his Accumulated Member Contributions, whichever occurs first;
or

	 
	 	(b)	 	the first day of the month next following the date of the Member’s death.

	B2.2	 	 “Accrued Benefit” means, as of any date, the amount of Retirement Benefit to which
an Appendix B Member is or would be entitled hereunder if he were
eligible to and did retire or otherwise terminate employment hereunder on such date,
commencing on his Normal Retirement Date and payable for his life.

 

54

 

	B2.3	 	 “Actuarial Equivalent” means a benefit which is of equal value to a benefit
otherwise payable in a different form or at a different time under the Plan, when computed,
using the same factors for males and females, on the basis of:

	 	(a)	 	83% of the mortality rates for males determined in accordance with the
Group Annuity Tables for 1951 — Males, projected to 1970 by Projection
Scale C, plus

	 	(b)	 	17% of the mortality rates for females equal to those for males five years
younger, and

	 	(c)	 	with an effective rate of interest of 4% compounded annually.

A lump sum payment is determined under the actuarial equivalence factors described in
Section B2.13.

	B2.4	 	 “Annuity Starting Date” means, in the case of any Member’s Retirement Benefit, the
first day of the first month for which the Retirement Benefit is payable. A Member’s Annuity
Starting Date shall be determined in accordance with the provisions of Section B7.4 (Normal
or Late Retirement Benefit) Section B7.5 (Deferred Early Retirement Benefit), Section B7.6
(Reduced Early Retirement Benefit), Section B7.7 (Disability Retirement Benefit), Section
B8.1(e) (pertaining to lump-sum benefits), Section B11.1 (Deferred Vested Retirement Benefit)
or Section B11.2 (Reduced Earlier Vested Retirement Benefit), whichever is applicable.

	B2.5	 	 “Base Pay” means the compensation payable to an Employee by the Company for time
worked on regular normal scheduled work days, including paid holidays and vacations exclusive
of all compensation for overtime worked, premiums, commissions, bonuses, amounts deferred or
payable under a nonqualified plan or arrangement or deferred compensation and all other forms
of additional compensation, but including (a) lump sum merit increases (one-twelfth of such
increase to be included as Base Pay for each month in the twelve month period beginning with
the month of payment), (b) amounts (if any) elected by the Employee to be deferred under a
cash or deferred arrangement, qualified under section 401(k) of the Code, that is part of a
plan in which the Company participates, and (c) amounts (if any) by which an Employee’s salary
or other remuneration is reduced pursuant to an election or designation made under a cafeteria
plan under Section 125 in which the Company participates. Base Pay for a Member for any Plan
Year in excess of the amount in effect for the Plan Year under section 401(a)(17) of the Code
will be disregarded under the Plan in accordance with the rules under section 401(a)(17) of
the Code.

 

55

 

	 	(a)	 	Notwithstanding the foregoing, for periods prior to May 16, 1998, an
Employee’s Base Pay shall also include compensation as described
above for services rendered to a prior employer while a member of the
BECO Retirement Plan, and

	 	(b)	 	except as may otherwise be agreed upon under the terms of a collective
bargaining agreement between the Company and Local 369, UWUA, AFL-CIO, Base Pay shall not include any compensation for periods subsequent
to the pay period ending September 30, 2005.

	B2.6	 	 “BECO Retirement Plan” means the Boston Edison Retirement Plan as in effect
immediately prior to the Effective Date of this Plan.

	B2.7	 	 “Beneficiary” means the person or persons entitled under Article 8 or Appendix B to receive
any benefit payable hereunder on or after the Member’s death, other than any benefit payable
to a spouse pursuant to Section B7.3, to a Surviving Spouse pursuant to Section B9.1 or to a
Contingent Annuitant pursuant to Article B8.

	B2.8	 	 “Contingent Annuitant” means the person to whom Retirement Benefit payments are to
be made for life after the death of a Member who (a) elected a Contingent Annuitant form of
Retirement Benefit pursuant to Article B8 and (b) dies on or after the Annuity Starting Date.

	B2.9	 	 “Effective Date” means January 1, 2000, unless otherwise specified herein; however,
the original effective date was May 16, 1998, and the original plan name was the Sithe New
England Power Services, Inc. Union Pension Plan.

	B2.10	 	 “Eligible Employee” means an active union Employee who was a Member of the Sithe
Energies, Inc. Group Pension Plan on December 31, 2000 and who is not a Member of the Sithe
Stable Account Plan cash balance feature.

	B2.11	 	 “Employee” means an employee of the Company or an Affiliated Company as determined by the
Company.

 

56

 

	B2.12	 	 “Final Average Pay” means the annual average of a Member’s Base Pay for those 36
consecutive months of employment as an Employee (or, if the Member has been an Employee for
less than 36 consecutive months, such lesser period of employment) within his last ten
consecutive calendar years of employment as an Employee which produces the highest average;
provided, however, that Final Average Pay shall not include any Base Pay for periods
subsequent to the pay period containing September 30, 2005. For purposes of the preceding
sentence, the term “last ten consecutive calendar years of employment as an Employee” means
the ten consecutive calendar years of employment as an Employee ending with the calendar year
in which an Employee dies, retires or otherwise ceases to be an Employee or to accrue benefits
under the Plan, whichever calendar year is earliest. In the event a Member ceases to be an Employee and thereafter
again becomes an Employee and a Member (unless in the interim he shall have suffered a
substantial period of severance as defined in Section B3.6), the periods before and after
his severance from service as an Employee shall be considered consecutive for purposes of
determining his Final Average Pay.

In determining Final Average Pay, a Member’s Base Pay for periods while a member of the
BECO Retirement Plan shall be taken into account, and solely for purposes of this Section,
such Member shall be considered an “Employee” for such periods.

	B2.13 	 	“Lump-sum Equivalent” means, in the case of a lump sum benefit which is to be paid
to a Participant, the actuarial present value of a Member’s Retirement Benefit, determined as
of the Annuity Starting Date, applying the “Applicable Mortality Table” and “Applicable
Interest Rate” as defined under Code section 417(e)(3)(A) (as amended by Public Law 103-465,
section 767(a)(2)) and the regulations and applicable rulings prescribed thereunder in effect
for the November preceding the Plan Year in which the Member’s Annuity Starting Date occurs.
However, for Annuity Starting Dates that occur in the 12-month period ending on December 31,
2001, the Applicable Interest Rate used to determine the Lump Sum Equivalent shall be the
rate in effect under Plan B on December 31, 2000 or the Applicable Interest Rate under the
Plan for the Plan Year beginning January 1, 2001, whichever produces the greater lump sum.

	B2.14	 	 “Member” means any Eligible Employee who is currently participating in the Plan in
accordance with Article B4 or any former Eligible Employee who continues to be entitled to a
benefit under the Plan.

	B2.15	 	 “Plan” means for purposes of this Appendix B, the Sithe Union Employees Pension Plan, which
prior to January 1, 2001 was known as the Sithe Energies, Inc. Group Pension Plan.

	B2.16	 	 “Plan Year” means for this Plan B the period from May 16, 1999 through May 15,
2000; the short period beginning May 16, 2000 and ending December 31, 2000; and each
calendar year thereafter beginning with 2001.

	B2.17	 	 “Retirement Date” means a Member’s Normal, Early, Late, or Disability Retirement
Date determined in accordance with Article B6.

	B2.18	 	 “Surviving Spouse” means the individual who was legally married to a Member during
the entire twelve-month period preceding the Member’s death.

 

57

 

ARTICLE B3

SERVICE DEFINITIONS

	B3.1 	  	“Employment Commencement Date” means the date on which the Employee first performs
an Hour of Service or, in the case of an Employee who incurs a Break in Service, the date on
which he first performs an Hour of Service after such Break.

	B3.2	  	 “Break in Service” means, in the case of any Employee, a Plan Year in which the
Employee has 500 or fewer Hours of Service, but not including any such Plan Year before the
one in which he ceases to be an Employee. Solely for purposes of determining whether a Break
in Service has occurred, there shall be credited to the Employee as Hours of Service each
hour not otherwise creditable under Section 1.21 during a period of absence from the Company
by reason of the Employee’s pregnancy; by reason of the birth of the Employee’s child; by
reason of the placement of a child with the Employee in connection with the adoption of such
child by the Employee; or for purposes of caring for such child for a period beginning
immediately following such birth or placement; provided, that:

	 	(a)	 	Any Hour of Service credited hereunder with respect to an absence shall be
credited (i) only in the Plan Year in which the absence begins, if the Employee would
be prevented from incurring a Break in Service in such Year solely because of Hours of
Service credited hereunder for such absence, or (ii) in any other case, in the
immediately following Plan Year;

	 	(b)	 	No Hours of Service shall be credited hereunder unless the Employee furnishes
the Plan Administrator with such information as the Plan Administrator may
reasonably require (in such form and at such time as the Plan Administrator may
reasonably require) establishing (i) that the absence from work is an absence described hereunder and (ii) the number of days for which the absence lasted;

	 	(c)	 	In no event shall more than 501 Hours of Service be credited to an Employee
hereunder for any one absence by reason of pregnancy or the placement of any one child.

	B3.3	 	 “Substantial Break” means, in the case of any Employee or Member who does not have a
nonforfeitable right to any portion of his Accrued Benefit, a number of consecutive Breaks in
Service which equals or exceeds five.

 

58

 

	B3.4	 	 “Year of
Eligibility Service” means,

	 	(a)	 	the twelve consecutive month period starting on an Employee’s Employment
Commencement Date, provided he completes at least 1,000 Hours of Service during such
period, or

	 	(b)	 	if the Employee does not complete at least 1,000 Hours of Service in the twelve
consecutive month period starting on an Employee’s Employment Commencement Date, any
Plan Year following such date during which he completes at least 1,000 Hours of
Service.

	 	(c)	 	For purposes of this Section, Hours of Service and the Employment Commencement
Date of any Employee who was both an active employee of Boston Edison Company and a
member of the BECO Retirement Plan immediately prior to the Effective Date shall
reflect the individual’s employment with Boston Edison Company.

	B3.5	 	 “Year of Vesting Service” means a Plan Year during which an Employee has at least
1,000 Hours of Service, subject to the following special rules:

	 	(a)	 	Each Member whose Year of Eligibility Service overlaps two Plan Years in
neither of which the Member has 1,000 Hours of Service shall, except as otherwise
provided in (b) and (c), be credited with one Year of Vesting Service upon becoming a
Member.

	 	(b)	 	If a Member has 1,000 Hours of Service in the period May 16, 2000 to May 15,
2001 and also in the period January 1, 2001 to December 31, 2001, he shall be credited
with two years of service for such periods.

	 	(c)	 	Except as otherwise provided in Section B3.8, in the case of a Member who
incurs a Substantial Break, Years of Vesting Service prior to such Break will be
disregarded.

	 	(d)	 	A Member who becomes disabled and retires in accordance with Section B6.3, and
is thereafter reemployed by the Company as an Employee prior to his Normal Retirement
Date, shall also be credited with a Year of Vesting Service for each Plan Year
during his period of disability retirement in which he has less than 1,000 Hours
of Service, such Years to be in addition to any Years of Vesting Service credited to
the Member under the other provisions of this Section.

	 	(e)	 	In the event a Member has a Break in Service and thereafter again becomes
an Employee and a Member without having incurred a Substantial Break,
his Years of Vesting Service prior to his Break in Service shall be restored to him.

	 	(f)	 	For purposes of this Section, Hours of Service and the Employment
Commencement Date of any Employee who was both an active employee of Boston Edison
Company and a member of the BECO Retirement Plan immediately prior to the Effective
Date shall reflect the individual’s employment with Boston Edison Company.

 

59

 

	B3.6	 	 “Years of Benefit Service” means the period of time (in years and fractions of
years) commencing with the date on which an Eligible Employee first performs an Hour of
Service for the Company (or the date on which a reemployed Employee first performs an Hour of
Service for the Company following reemployment) and ending on the earlier of the date he
ceases to be an Eligible Employee or September 30, 2005. All periods of service shall be
cumulative; provided, however, that, except as otherwise provided in Section B3.8, periods
prior to a substantial period of severance shall be disregarded. For purposes of the
foregoing, a “substantial period of severance” means, in the case of an individual who ceases
to be an Employee and at such time does not have a nonforfeitable interest in any portion of
his Retirement Benefit, a period of at least five years (six years, if the individual ceases
to be an Employee for one of the reasons specified in the first paragraph of Section B3.2
above) during which the individual is credited with no service as an Employee.

For any Member who was both an active employee of Boston Edison Company and a member of the
BECO Retirement Plan immediately prior to the Effective Date, Years of Benefit Service
shall also include the years of benefit service (including fractions thereof) such member
had credited under the BECO Retirement Plan as of May 15, 1998.

	B3.7	 	 “Fully Vested” means, in the case of any Member, that the Member has completed at
least five Years of Vesting Service.

	B3.8	 	 “Service Bridging” means the following. In accordance with agreements entered into
from time to time between the Company and Local 369, UWUA, AFL-CIO, Years of Vesting Service
prior to a Substantial Break or Years of Benefit Service prior to a “substantial period of
severance” (as defined in Section B3.6) shall be counted for purposes of the Plan in the case
of those Members who have been selected by the Plan Administrator pursuant to such
agreements.

ARTICLE B4

ELIGIBILITY FOR MEMBERSHIP

	B4.1	 	 Eligibility. Effective January 1, 2001, this Appendix B shall have no new Members.
The Members of this Appendix B shall be those Union Members who were covered by the Sithe
Energies Group Pension Plan on December 31, 2000 and who are not covered on and after such
date by the provisions of the cash balance feature described in the body of this document.

	B4.2	 	 Membership Following a Break in Service. In the event a Member’s employment
terminates and thereafter the Member again becomes an Employee, he shall become an active
Member immediately upon again becoming an Employee; except that if he incurs a Substantial
Break, he shall be considered for all purposes of the Plan as a new Employee.

 

60

 

ARTICLE B5

CONTRIBUTIONS TO THE FUND

	B5.1	 	Continuation of Member Contributions. Each Member who was contributing to the BECO
Retirement Plan on May 15, 1998 may continue to contribute under this Plan on and after the
Effective Date in each calendar year while he is a Member in an amount equal to 3.75% of his
Base Pay in excess of $6,600 for such calendar year; provided, however, that no such
contribution shall be made after the earliest of: (a) December 31, 2000, (b) the date the
Member ceases to be an Employee, (c) the date the Member ceases to accrue benefits under this
Appendix B, (d) the date as of which he elects to discontinue his contributions, or (e) the
date he elects to withdraw his Accumulated Member Contributions. A contributing Member may
discontinue his contributions to the Plan upon written notification to the Plan
Administrator.

The contributions of a Member shall be made by deductions from his pay on written
authorization and in a manner determined by the Plan Administrator in its sole discretion,
and the amounts of contributions so deducted shall be paid to the Fund by the Company as of
the earliest date on which the contributions can reasonably be segregated from the
Company’s general assets, but in no event later than the 15th business day of the month
following the month in which amounts would otherwise have been payable to the Member in
cash.

	B5.2	 	 Withdrawal of Accumulated Member Contributions. 

	 	(a)	 	A contributing Member may, as of the first day of any month, but not after
the date his Retirement Benefit payments commence, upon written request filed
with the Plan Administrator, elect to withdraw his eligible Accumulated Member
Contributions from the Fund. For purposes of the preceding sentence, “eligible
Accumulated Member Contributions” means the Member’s total Accumulated Member
Contributions as provided under Section B2.1. In the event of a withdrawal as
described in the first sentence of this paragraph, the formula Contributory
Retirement Benefit specified in Section B7.1(b)(i) shall be reduced (but not below
zero) as specified in that Section by the Retirement Benefit derived from the
Member’s contributions. The Retirement Benefit derived from the
Member’s contributions shall be an annual benefit, payable for the life of the Member
only and commencing at Normal Retirement Age, equivalent to the Member’s eligible
Accumulated Member Contributions, such equivalency to be determined in
accordance with the provisions of section 411(c) of the Code.

 

61

 

	 	(b)	 	Upon receipt of a request for a withdrawal the Plan Administrator shall
provide the Member with a written notification in nontechnical terms describing
the effects of such withdrawal and the rights of the Member and, if applicable,
the Member’s spouse with respect thereto. Such notification shall be comparable to the notification specified in Section 4.3,
except that the Plan Administrator shall make such modifications as it may deem
advisable, consistent with applicable law and regulations. No election to withdraw
shall be effective unless made within the 90-day period immediately preceding the
date of withdrawal. If the Member is married, his election to withdraw shall not be
effective unless his spouse also consents in writing thereto and acknowledges the
effect of such election (or it is determined that spousal consent and
acknowledgment cannot be obtained) in accordance with the rules set forth in
Section 4.3. The provisions of this paragraph (b) shall not apply where the
Lump-sum Equivalent of the Member’s vested Accrued Benefit, determined as of the
date of the withdrawal (or, if required under the Code or regulations thereunder,
the date of any prior withdrawal), is $5,000 or less (or such greater amount as
permitted under Code Section 411(a)(11)).

	B5.3	 	 Forfeitures and Other Gains. Gains arising from any forfeiture of the interest in
the Fund of any Member, because of death, severance of employment or any other reason,
shall be applied to reduce the amount of Company contributions and not to increase the
benefits otherwise payable under the Plan.

ARTICLE B6

RETIREMENT DATES

	B6.1 	 	Normal Retirement Date. The Normal Retirement Date of a Member shall be the first
day of the month next following his 65th birthday. Upon attaining age 65 while still employed
by the Company, a Member shall have a fully vested and nonforfeitable interest in his Accrued
Benefit and shall be entitled to retire and receive such benefit commencing on his Normal Retirement Date.

	B6.2 	 	Early Retirement Date. A Member may elect to retire or may be retired by the
Company, except solely on the basis of age, on the first day of any month prior to his Normal
Retirement Date if he meets one of the following requirements:

	 	(a)	 	He has completed 20 Years of Benefit Service, has attained his 45th
birthday, and resigns for cause or is discharged for reasons not the fault of the
employee.

	 	(b)	 	He has both completed 10 Years of Benefit Service and attained his 62nd
birthday.

	 	(c)	 	He has completed 20 Years of Benefit Service and attained his 55th birthday.

	 	(d)	 	The sum of his age on his last birthday and whole Years of Benefit Service
is 85 or more.

 

62

 

For purposes of subsection (a) of this Section, “fault of the employee” means only gross or
habitual insubordination, continuous absence from duty without leave when not caused by
illness or other similar disability, failure or neglect to perform his duties with normal
efficiency, or other serious misconduct which makes unwise any other action than discharge;
and “resigns for cause” means the resignation of an Employee after changes (gradual or
otherwise) have been made in the nature of his duties or in the conditions under which he
works which adversely and materially affect his status, or after a material reduction
(gradual or otherwise) in his compensation which is not of general application within the
Company, or after he has been laid off without his consent for a continuous period of more
than six months.

	B6.3	 	 Disability Retirement Date. A Member who has completed 15 Years of Benefit Service,
is disabled from employment with the Company and is receiving disability payments under the
Social Security Act may elect to retire or may be retired by the Company. The Disability
Retirement Date of a Member who is retired by the Company shall be the date determined by the
Company. The Disability Retirement Date of a Member who elects to retire shall be the date
elected by the Member but not earlier than the first day of the first month on which he meets
the requirements set forth above in this section.

A Member who is determined to be totally and permanently disabled and who has completed 15
Years of Benefit Service shall also be eligible to elect a disability retirement under this
Section or may be retired under this Section by the Company, whether or not he is receiving
disability payments under the Social Security Act. For purposes of the foregoing, the
determination of a Member’s total and permanent disability may be made by a doctor of either
the Member’s or the Company’s choosing. The doctor’s determination shall be embodied in a
written report made available to both the Member and the Company. The report of a doctor
selected by the Member shall be prepared at the Member’s expense, and the report of a doctor
selected by the Company shall be made at the Company’s expense. If doctors selected by the
Member and the Company fail to agree, the Member and the Company shall by agreement select a
third doctor who shall be a specialist specified by his respective Board. The three doctors
shall meet as a committee and consider the case and the decision of a majority of such
doctors so acting shall be final and binding on the parties. Each party shall compensate the
doctor chosen by such party for the time spent and expenses incurred in the case, and the
parties shall share equally in paying the compensation and expenses of the third doctor.

	B6.4	 	 Late Retirement Date. A Member may continue as an Employee after his Normal
Retirement Date, subject to such restrictions and limitations, consistent with applicable law,
as the Company may prescribe. The Member shall not be eligible for Retirement Benefits prior
to his Late Retirement Date except as required under section 401(a)(9) of the Code or as
provided in Section B17.8. A Member’s Late Retirement Date shall be the first day of the month coinciding with or next following the date after his Normal Retirement Date on which he shall actually retire or be
retired.

 

63

 

ARTICLE B7

NORMAL FORM AND AMOUNT OF RETIREMENT BENEFITS

	B7.1	 	 Formula Retirement Benefit. The formula Retirement Benefit shall be a monthly
Retirement Benefit payable as a single life annuity commencing on the later of the Member’s
Normal or Late Retirement Date and ceasing with the last payment due before his death. The
amount of the monthly formula Retirement Benefit payable to a Member shall equal the Member’s
Noncontributory Retirement Benefit determined under (a) below plus the Member’s Contributory
Retirement Benefit, if any, as determined under (b) below, but not less than the Member’s
Minimum Retirement Benefit, as determined under (c) below.

	 	(a)	 	Noncontributory Retirement Benefit shall be equal to (i), (ii), or
(iii) as applicable:

	 	(i)	 	Except for those Members described in (ii) or (iii) below, a
Member’s Noncontributory Retirement Benefit shall be equal to 1/12 of: 1.40%
of the Member’s Final Average Pay multiplied by the Member’s Years of Benefit
Service not in excess of 15 years, plus 1.86% of the Member’s Final Average
Pay multiplied by the Member’s Years of Benefit Service in excess of 15 years
but not in excess of 30 years, plus 0.65% of the Member’s Final Average Pay
multiplied by the Member’s Years of Benefit Service in excess of 30 years.

	 	(ii)	 	Former BECO Retirement Plan Members. Except for
Members described in (iii) below, the Noncontributory Retirement Benefit for a
Member who was a member of the BECO Retirement Plan immediately prior to the
Effective Date and who became a Member hereunder as of the Effective Date
shall be equal to 1/12 of (A) minus (B) below where:

	 	(A)	 	equals the benefit determined under (i) above,
which shall reflect years of benefit service credited under the BECO
Retirement Plan as of May 15, 1998, as provided in Section B3.7, and

	 	(B)	 	equals the Member’s BECO Retirement Plan
Benefit (as defined below).

 

64

 

For purposes of this subsection a Member’s “BECO Retirement Plan Benefit”
shall equal the Member’s accrued benefit under the BECO Retirement Plan as
of May 15, 1998 determined using the formula provided in (i) above based on the Member’s years of benefit service under
the BECO Retirement Plan as of such date but based on the Member’s Final Average
Pay as of the earliest of September 30, 2005 or his retirement, death, or other
termination of employment with the Company.

	 	(iii)	 	Former Local 387 BECO Retirement Plan Members. The Noncontributory
Retirement Benefit for a Member who was a member of the BECO Retirement Plan
immediately prior to the Effective Date; who became a Member hereunder as of the
Effective Date; and who also was a member of Local 387, UWUA, AFL-CIO immediately
prior to its merger with Local 369, UWUA, AFL-CIO effective April 9, 1998 shall equal
the benefit determined under (i) above but based on Years of Benefit Service credited
to such Member subsequent to May 15, 1998 and up to September 30, 2005. However,
solely for purposes of determining the accrual percentage to apply under such formula
(1.40%, 1.86%, or 0.65%), years of benefit service credited to the Member under the
BECO Retirement Plan shall be considered.

	 	(iv)	 	In no event shall this Plan be liable for any benefits accrued by
Members under the BECO Retirement Plan.

	 	(b)	 	Contributory Retirement Benefit. A Member’s Contributory Retirement Benefit, if any,
shall equal the greater of (i) and (ii), where

	 	(i)	 	equals one-third of the sum of all contributions made by the Member under
the Plan, reduced (but not below zero) by the “Retirement Benefit derived from the
Member’s contributions” previously withdrawn as that term is used in Section B5.2(a);
and

	 	(ii)	 	the benefit derived from the Member’s remaining Accumulated Member
Contributions, if any, under the Plan as of the Member’s Annuity Starting Date,
determined in accordance with the provisions of section 411(c) of the Code.

	 	(c)	 	Minimum Retirement Benefit. Notwithstanding the foregoing, a Member’s formula
Retirement Benefit shall not be less than the amount of Retirement Benefit the
Member could have received under Sections B7.6 if he had retired hereunder on any possible
Early Retirement Date. Furthermore, for any Member who was not an active member of the BECO
Retirement plan on the day before the Effective Date, such Member’s formula Retirement
Benefit shall not be less than $100 per month payable as a single life annuity commencing on
the later of the Member’s Normal or Late Retirement Date.

 

65

 

	B7.2	 	 Normal Form of Retirement Benefit for Single Members. The normal form of
Retirement Benefit for a Member who is not married on his Annuity Starting Date shall be
the formula Retirement Benefit, payable as a single life annuity.

	B7.3	 	 Normal Form of Retirement Benefit for Married Members. The normal form of Retirement
Benefit for a Member who is married on his Annuity Starting Date shall be a joint and
survivor form of Retirement Benefit and shall be the Actuarial Equivalent of the formula
Retirement Benefit. Under this normal form of Retirement Benefit, the Member shall receive a
reduced amount of monthly Retirement Benefit payable during his lifetime, and, commencing on
the first day of the month next following his death, 50% of such reduced Retirement Benefit
shall be payable for life to the person who was the Member’s spouse on the Member’s Annuity
Starting Date. The death of the Member’s spouse after the Member’s Annuity Starting Date and
while the Member is still living shall not affect the reduced amount of Retirement Benefit
payments payable thereafter to the Member under this form of Retirement Benefit.

	B7.4	 	 Normal or Late Retirement Benefit. Each Member who retires on or after his Normal
Retirement Date shall be entitled to receive, commencing on his Retirement Date, a monthly
amount of formula Retirement Benefit payable under the normal form applicable to the Member
in accordance with Sections B7.2 or B7.3.

	B7.5	 	 Deferred Early Retirement Benefit. Each Member who retires in accordance with
Section B6.2 before his Normal Retirement Date shall be entitled to receive, commencing on
his Normal Retirement Date, the monthly amount of formula Retirement Benefit described in
Section B7.1, payable under the normal form applicable to the Member in accordance with
Section B7.2 or B7.3 and determined as of his Early Retirement Date.

	B7.6	 	 Reduced Early Retirement Benefit.

	 	(a)	 	In lieu of the Retirement Benefit specified in Section B7.5, a Member may
elect to receive a reduced monthly amount of Retirement Benefit, commencing
on the first day of any month on or after his Early Retirement Date and before his
Normal Retirement Date, and on or after the date his election is filed with the
Committee, and payable thereafter during his lifetime.

 

66

 

	 	(b)	 	The Retirement Benefit of an Appendix B Member who retires before October 1,
2005 and prior to his Normal Retirement Date shall be equal to the Retirement Benefit
otherwise payable under Section B7.5, multiplied by the appropriate early
retirement factor, determined as of the commencement date of his Retirement
Benefit, from the table set forth below, interpolated for full months prior to Normal
Retirement Date. A Member to whom this Section applies may also be eligible for
the Temporary Supplemental Benefit for Certain Early Retirees as described in Section B7.7
below.

	 	 	 	 	 
	Full Years	 	Early	 
	Prior to Normal	 	Retirement	 
	Retirement Date	 	Factor	 
	 
	 	 	 	 
	1
	 	 	1.000	 
	2
	 	 	1.000	 
	3
	 	 	1.000	 
	4
	 	 	1.000	 
	5
	 	 	1.000	 
	6
	 	 	.925	 
	7
	 	 	.850	 
	8
	 	 	.775	 
	9
	 	 	.700	 
	10
	 	 	.625	 
	11
	 	 	.457	 
	12
	 	 	.430	 
	13
	 	 	.404	 
	14
	 	 	.382	 
	15
	 	 	.360	 
	16
	 	 	.340	 
	17
	 	 	.321	 
	18
	 	 	.304	 
	19
	 	 	.288	 
	20
	 	 	.272	 

Notwithstanding the foregoing, in the case of any Member who has forty (40) or more Years
of Vesting Service, or who has both attained age 57 and completed 35 Years of Vesting
Service, the early retirement factor to be applied in determining the Member’s Retirement
Benefit shall be 1,000 if such Member retires on or before September 30, 2005.

	 	(c)	 	Notwithstanding the foregoing, the Retirement Benefit for an Appendix B
Member who retires after September 30, 2005 shall be payable pursuant to (b) above with
respect to benefit accruals prior to January 1, 2001. However, for benefit accruals after
December 31, 2000, such benefit shall be multiplied by the appropriate early retirement
factor, determined as of the commencement of the Retirement Benefit, from the table set
forth below, interpolated for full months prior to Normal Retirement Date.

	 	 	 	 	 
	Full Years 	 	Early	 
	Prior to Normal	 	Retirement	 
	Retirement Date	 	Factor	 
	 
	 	 	 	 
	1
	 	 	.922	 
	2
	 	 	.851	 
	3
	 	 	.786	 
	4
	 	 	.727	 
	5
	 	 	.674	 
	6
	 	 	.624	 
	7
	 	 	.579	 
	8
	 	 	.537	 
	9
	 	 	.499	 
	10
	 	 	.463	 
	11
	 	 	.457	 
	12
	 	 	.430	 
	13
	 	 	.404	 
	14
	 	 	.382	 
	15
	 	 	.360	 
	16
	 	 	.340	 
	17
	 	 	.321	 
	18
	 	 	.304	 
	19
	 	 	.288	 
	20
	 	 	.272	 

 

67

 

	B7.7	 	 Temporary Supplemental Benefit for Certain Early Retirees. A Member who retires
early under Section B7.6 and who retires at age 57, 58, 59, 60 or 61 with at least 35 Years
of Benefit Service shall, in addition to the formula Retirement Benefit, receive a monthly
supplement, payable from the Member’s Early Retirement Date until the earlier of (a) the
Member’s death or (b) the month in which the Member attains age 62, equal to $10.00 times the
Member’s Years of Benefit Service, if such Member retires on or before September 30, 2005.
This benefit will be reduced by any concurrent temporary supplement payable to the Member
from the BECO Retirement Plan in respect of service rendered before May 15, 1998.

	B7.8	 	 Disability Retirement Benefit. If an Appendix B Member is disabled and retires in
accordance with Section B6.3 before his Normal Retirement Date, he shall be entitled to
receive, commencing on his Normal Retirement Date or, if the Member so elects, on the first
day of any earlier month on or after his Disability Retirement Date, a monthly amount of
formula Retirement Benefit payable under the normal form applicable to the Member in
accordance with Section B7.2 or B7.3 and determined as of his Disability Retirement Date.

If a disabled Appendix B Member who retired in accordance with Section B6.3 and who begins
receiving a benefit is reemployed by the Company as an Employee, payment of his Retirement
Benefit shall be suspended during his subsequent period of reemployment (but only to the
extent permitted under section 203 of ERISA and the regulations thereunder); he shall
immediately become an active Member of the Plan; and his Years of Vesting Service and Years
of Benefit Service at the time of his disability retirement shall be restored to him, and
the Plan Years before and after his disability retirement shall be considered consecutive
in determining his Final Average Pay.

If a disabled Appendix B Member who retired in accordance with Section B6.3 and who begins
receiving a benefit recovers sufficiently from the disability such that he is no longer
receiving disability benefits under the Social Security Act and he is not reemployed by
the Company, his Retirement Benefit payments shall be reduced
thereafter to the amount of Retirement Benefit payments computed under Section B11.2 as of
the date of his disability retirement.

	B7.9	 	 Retirement Benefit After Reemployment Following a Break in Service. This Section
shall apply in the event an Appendix B Member has a Break in Service and thereafter again
becomes an Employee and an Appendix B Member and does not incur a Substantial Break. On or
after the date he again becomes an Employee, any such Member who is receiving Retirement
Benefit payments may
elect to discontinue receiving such payments (but only to the extent permitted under
section 203 of ERISA, the regulations thereunder, and the Code. Whether or not such Member
elects to discontinue receiving Retirement Benefit payments, his Accrued Benefit after his
reemployment shall be reduced by the Actuarial Equivalent of the total Retirement Benefit
payments received by the Member prior to the date as of which his Accrued Benefit is
determined; provided, however, that such Accrued Benefit shall not, when computed in the
same form as the Member was receiving when reemployed, be less than the Retirement Benefit
payments the member was receiving when reemployed.

 

68

 

ARTICLE B8

OPTIONAL FORMS OF RETIREMENT BENEFIT

	B8.1	 	 Options and Elections. Subject to the conditions enumerated in Section 4.3, a Member
may elect to receive one of the following optional forms of Retirement Benefit in lieu of the
form of Retirement Benefit otherwise payable under Article B7 or B11:

	 	(a)	 	A contingent annuitant form of Retirement Benefit under which the
Member shall receive a reduced monthly amount of Retirement Benefit payable during his
lifetime; and, if the Member dies after his Annuity Starting Date and the person
designated by him as Contingent Annuitant survives him, such Contingent Annuitant shall
receive for life, commencing on the first day of the month next following the month in
which the death of the Member occurs, either the same reduced monthly amount or such
fraction thereof as is approved by the Plan Administrator and is specified by the
Member in his election. Upon the death of both the Member and his Contingent Annuitant
after the effective date of the option, there shall be paid to the Member’s Beneficiary
an amount equal to the excess, if any, of the Accumulated Member Contributions of the
Member over the sum of the Retirement Benefit payments made to the Member and his
Contingent Annuitant which are attributable to the contributory Retirement Benefit
specified in Section B7.1(b).

	 	(b)	 	A spousal joint and survivor form of Retirement Benefit under which the
Member shall receive a reduced amount of Retirement Benefit payable during his
lifetime, and, commencing on the first day of the month next following his death, 50%
of such reduced Retirement Benefit shall be payable for life to the person who was his
spouse on the date that the Retirement Benefit payments commenced; provided, that if
such spouse dies after the Annuity Starting Date and while the Member is still living,
the Retirement Benefit thereafter payable to the Member, commencing on the first day or
the month next following his spouse’s death, shall be increased to equal the Retirement
Income that would have been payable to the Member had he effectively elected option (f)
below.

 

69

 

	 	(c)	 	A ten year certain and lifetime form of Retirement Benefit under which the
Member shall receive a reduced monthly amount of Retirement Benefit payable during his
lifetime; and, if the Member dies after the effective date of the option and the person
designated by him as Beneficiary survives him, such Beneficiary shall receive for life,
commencing on the first day of the month next following the month in which the death of the
Member occurs, the same reduced amount of Retirement Benefit until the Member and his
Beneficiary together have received 120 payments; provided, however, if the Member has
designated as his Beneficiary his estate, a corporation, association, partnership or
trustee, the commuted value of the payments due such Beneficiary may be paid in one
sum to such Beneficiary if the Plan Administrator shall so direct. The form of benefit
described in this subsection shall not be available unless the life expectancies of
the Member and his designated Beneficiary, as of the date benefits commence, equal or
exceed ten years.

	 	(d)	 	A fifteen-year certain and lifetime form of Retirement Benefit under which the Member
shall receive a reduced monthly amount of Retirement Benefit payable during his lifetime; and,
if the Member dies after the effective date of the option and the person designated by him as
Beneficiary survives him, such Beneficiary shall receive for life, commencing on the first day
of the month next following the month in which the death of the Member occurs, the same
reduced amount of Retirement Benefit until the Member and his Beneficiary together have
received 180 payments; provided, however, if the Member has designated as his Beneficiary his
estate, a corporation, association, partnership or trustee, the commuted value of the payments
due such Beneficiary may be paid in one sum to such Beneficiary if the Plan
Administrator shall so direct. The form of benefit described in this subsection shall
not be available unless the life expectancies of the Member and his designated
Beneficiary, as of the date benefits commence, equal or exceed fifteen years.

	 	(e)	 	A lump sum form under which the Member shall receive a single payment equal to the
Lump-sum Equivalent of 100%, 75%, 50% or 25%, as elected by the Member, of the formula
Retirement Benefit otherwise payable to the Member, determined as of the Member’s Annuity
Starting Date. If a Member elects to receive less than 100% of his formula Retirement Benefit
in a lump sum form, the balance of his formula Retirement Benefit shall be paid in such other
optional form elected by the Member under this Section. For purposes of this subsection the
following rules shall apply:

	 	(i)	 	A Member who wishes to select the option described in this subsection
must so notify the Company in writing, in such form as the Plan Administrator shall
prescribe, at least three (3) months (but not more than six (6) months) prior to the
Member’s Annuity Starting Date. The Notification required by this paragraph shall be
in addition to, and not in lieu of, the requirement that the Member formally waive
the normal form of benefit described in Section B7.2 or Section B7.3 (whichever is
applicable), in accordance with the provisions of Section 4.3, during the 30- to
90-day period immediately preceding the Annuity Starting Date. Nothing in this
paragraph shall be deemed to limit the right of a Member who has given notice of
his intent to receive the lump sum form of benefit, to revoke such notice at any
time prior to his Annuity Starting Date and elect to receive his benefit in the
normal form described in Section B7.2 or Section B7.3, whichever is applicable, or
in another alternative form of payment available under the Plan, subject to the
rules and conditions applicable to elections of such alternative form, including
the prior-notice provisions of this paragraph in the case of any Member who again
determines to receive payment of all or a portion of his Retirement Benefit in
lump-sum form.

 

70

 

	 	(ii)	 	In the case of a Member (A) whose Annuity Starting Date (determined under the
provisions of Articles B6, B7, or B11) would, but for the operation of this
subsection, fall on or after the date which precedes by six months the Member’s Normal
Retirement Date, but (B) who elects the lump-sum option described in this subsection,
the Annuity Starting Date of such Member shall be the later of the date determined
under Articles B6, B7, or B11 (without regard to this subsection) or the first day of
the first month which follows by at least six months the date on which the Member
gives written notice to the Company, in accordance with paragraph (i) above, of his
desire to take all or a portion of his Retirement Benefit in lump-sum form. If a
Member’s Annuity Starting Date would, by reason of the application of this subsection,
fall more than one month after the date of his actual retirement or age 65, whichever
is later (the “predeferral date”), the Member’s Retirement Benefit shall be the
Actuarial Equivalent of the Member’s Retirement Benefit determined as of his
predeferral date. The actuarial adjustment required by this paragraph shall be made
before the Lump-sum Equivalent of the Member’s Retirement Benefit is determined.

	 	(f)	 	A life annuity form of Retirement Benefit under which the Member shall receive the
monthly amount of formula Retirement Benefit payable during his lifetime with all payments
ceasing at his death.

	 	(g)	 	A social security equalizer form of Retirement Benefit under which the Member shall
receive a larger monthly amount of Retirement Benefit before the Member attains age 62, and a
reduced monthly amount of Retirement Benefit on and after the Member attains age 62, such that
the monthly amount of Retirement Benefit payable before the Member attains age 62 is equal to
the sum of the monthly amount of Retirement Benefit
payable on and after the Member attains age 62 plus the monthly Social Security
Benefits to which the Member would be entitled upon his attainment of age 62 if
Social Security Benefits commenced to the Member at that time, all as determined by
the Plan Administrator; provided that this option shall be available only if the
Member has not attained age 62 as of the effective date of the option and the
Member satisfies such other conditions or requirements consistent with applicable
law as the Plan Administrator may in its discretion prescribe.

	B8.2	 	 Amount of Retirement Benefit. The amount of Retirement Benefit payable under the
optional forms described in Section B8.1 shall be the Actuarial Equivalent (or, in the case
of Section B8.1(e), the Lump-sum Equivalent) of the amount of Retirement Benefit otherwise
payable under the normal form.

 

71

 

ARTICLE B9

DEATH PRIOR TO ANNUITY STARTING DATE

	B9.1	 	 Preretirement Surviving Spouse Benefit. In the case of an Appendix B Member who is
Fully Vested and who dies prior to his Annuity Starting Date, there shall be paid to his
Surviving Spouse, if any, a monthly Retirement Benefit, commencing on the date hereinafter
specified (if the Surviving Spouse is then alive) and ceasing after the first day of the
month in which the Surviving Spouse dies, computed as follows:

	 	(a)	 	If the Member dies while an Employee and after attaining his 55th birthday or
completing 10 Years of Benefit Service and before his Normal Retirement Date,
the monthly Retirement Benefit payable to his Surviving Spouse shall equal 50% of the
monthly formula Retirement Benefit specified in Section B7.1.

	 	(b)	 	In every case to which this Section applies but which is not described under
(a) above, the monthly Retirement Benefit payable to the deceased Member’s Surviving
Spouse shall be the Actuarial Equivalent of an amount equal to the monthly amount
such Surviving Spouse would have been entitled to receive had the Member:

	 	(i)	 	terminated employment on the date of his death (or, if
earlier, on the actual date of his termination of employment).

	 	(ii)	 	effectively elected to have his reduced Retirement Benefit
commence on the date of his death to be paid (in the normal form described in
Section B7.3) under the provisions of either:

	 	(A)	 	Section B7.6 (if the Member had satisfied
the requirements for early retirement under Section 6.2), or

	 	(B)	 	Section B11.2 (in every other case), and

 

72

 

	 	(iii)	 	died immediately following such benefit commencement.

Notwithstanding the foregoing, and except as provided under paragraph (a) above, if a
Member dies prior to his Normal Retirement Date and payment of the benefit to his
Surviving Spouse hereunder is deferred until the Member would have attained his
Normal Retirement Date, such Spouse’s monthly benefit shall not exceed the monthly
amount to which such Spouse would have been entitled if the Member had terminated
employment as aforesaid, taken a reduced Retirement Benefit (in the normal form
described in Section B7.3) commencing at Normal Retirement Date, and died immediately
following such benefit commencement.

A Surviving Spouse may direct that benefits be paid commencing on the first day of
any month following the date of the Member’s death, but not later than the date the
deceased Member would have attained his Normal Retirement Date (with retroactive
adjustment, if notice of death is not given the Surviving Spouse in time to render
practicable the commencement of payments until a subsequent month). Any such
direction by a Surviving Spouse shall be made in such form and manner as the Plan
Administrator shall approve or prescribe.

Any Surviving Spouse who is entitled to a Retirement Benefit in accordance with this
Section B9.1 may elect to receive payment in a lump sum of the Member’s eligible
Accumulated Member Contributions (as that term is defined in Section B5.2), in which
event the Surviving Spouse’s monthly contributory Retirement Benefit, to the extent
determined by reference to Section B7.1(b), shall be reduced by 50% of the
Retirement Benefit derived from the Member’s contributions determined in accordance
with the provisions of Section B5.2.

The Surviving Spouse of a Member who is entitled to a formula Retirement Benefit in
accordance with this Section 9.1 may elect to receive the Lump-sum Equivalent of
100%, 75%, 50% or 25% of such formula Retirement Benefit (determined as of the date
of payment) in lieu of the formula Retirement Benefit otherwise payable. If the
Surviving Spouse elects to receive the Lump Sum Equivalent of less than 100% of the
formula Retirement Benefit, the balance of the formula Retirement Benefit will be
paid in accordance with the other provisions of this Section B9.1.

	B9.2	 	 Return of Accumulated Member Contributions. If a Member dies prior to his Annuity
Starting Date and does not have a Surviving Spouse or his Surviving Spouse is not entitled to
a Retirement Benefit under the provisions of Section
B9.1, the Member’s Accumulated Member Contributions shall be paid to the Member’s
Beneficiary.

 

73

 

If a Member dies prior to his Annuity Starting Date, and if the Member has a Surviving
Spouse who is entitled to a Retirement Benefit under the provisions of Section B9.1 and who
did not elect to receive a lump sum payment of the Member’s eligible Accumulated Member
Contributions in accordance with Section B9.1, there shall be paid to the Member’s
Beneficiary, after the death of the Surviving Spouse, an amount equal to the excess, if
any, of the Member’s Accumulated Member Contributions over the sum of any monthly
contributory Retirement Benefit payments made to the Member’s Surviving Spouse under
Section B9.1 pursuant to Section B7.1(b).

	B9.3	 	 Termination of Membership. Except as otherwise provided in this Article B9, death of
a Member prior to his Annuity Starting Date shall terminate his membership in the Plan and
his interest in the Fund shall be forfeited.

ARTICLE B10

DEATH ON OR AFTER ANNUITY STARTING DATE

	B10.1	 	 No Optional Form of Retirement Benefit in Effect. If an Appendix B Member dies on
or after his Annuity Starting Date and if no optional form of Retirement Benefit under
Article B8 is in effect, there shall be paid to the Member’s Beneficiary, after the death of
his spouse in the case of a married Member who had not effectively revoked the normal joint
and survivor form of Retirement Benefit, an amount equal to the excess, if any, of his
Accumulated Member Contributions over the sum of the contributory Retirement Benefit payments
specified in Section B7.1(b) (or reduced as provided in Section B7.3, B7.6, or B11.2)
received by him and his spouse.

	B10.2	 	 Optional or Normal Form of Retirement Benefit For Married Member in Effect. If an
Appendix B Member dies on or after his Annuity Starting Date and if an optional form of
Retirement Benefit under Article B8 is in effect or, in the case of a married Member, if the
normal joint and survivor form of Retirement Benefit is in effect, there shall be paid to his
Beneficiary, Contingent Annuitant or Surviving Spouse, as the case may be, the benefits, if
any, payable upon his death in accordance with the appropriate provisions of Article B8 or
Section B7.3.

	B10.3	 	 Termination of Membership. Except as otherwise provided in this Article B10, death of an
Appendix B Member on or after his Annuity Starting Date shall terminate his membership in the
Plan, and his interest in the Fund shall be forfeited.

 

74

 

ARTICLE B11

VESTING

	B11.1	 	 Deferred Vested Retirement Benefit. An Appendix B Member who ceases to be an
Employee other than by death prior to retirement, who is not eligible for early
or disability retirement under the provisions of Section B6.2 or B6.3 and who is Fully
Vested as provided in Section 3.9 shall continue as a Member in the Plan and shall be
entitled to a deferred vested Retirement Benefit commencing on his Normal Retirement Date
and payable thereafter during his lifetime, equal to the Member’s Accrued Benefit described
in Section B7.1, payable under the normal form applicable to the Member in accordance with
Section B7.2 or B7.3, and determined as of the date he ceases to be an Eligible Employee.

	B11.2	 	 Reduced Earlier Vested Retirement Benefit. In lieu of the deferred vested
Retirement Benefit specified in Section B11.1, an Appendix B Member may elect to receive a
reduced monthly amount of Retirement Benefit, commencing on the first day of any month on or
after the date he ceases to be an Employee and on or after the date his election is filed
with the Plan Administrator, but before his Normal Retirement Date. A Retirement Benefit
payable hereunder prior to a Member’s Normal Retirement Date shall be equal to the Retirement
Benefit otherwise determined and payable under Section B11.1, multiplied by the appropriate
factor, determined as of the commencement date of his Retirement Benefit from the table set
forth in Section B7.6, or if the Member elects to receive his Retirement Benefit earlier
than 20 years prior to his Normal Retirement Date, from the following table, interpolated for
full months prior to Normal Retirement Date:

	 	 	 	 	 
	Full Years	 	Early	 
	Prior to Normal	 	Retirement	 
	Retirement Date	 	Factor	 
	 
	 	 	 	 
	21
	 	 	.259	 
	22
	 	 	.246	 
	23
	 	 	.233	 
	24
	 	 	.222	 
	25
	 	 	.211	 
	26
	 	 	.201	 
	27
	 	 	.191	 
	28
	 	 	.182	 
	29
	 	 	.174	 
	30
	 	 	.165	 
	31
	 	 	.158	 
	32
	 	 	.151	 
	33
	 	 	.144	 
	34
	 	 	.138	 
	35
	 	 	.131	 
	36
	 	 	.125	 
	37
	 	 	.120	 
	38
	 	 	.115	 
	39
	 	 	.111	 
	40
	 	 	.106	 

 

75

 

	B11.3	 	 No Reduction of Vesting. If the vesting requirements for a deferred vested
Retirement Benefit under the Plan, as now in effect or as hereafter amended, (the “new
vesting provisions”) would at any time result in a deferred vested Retirement Benefit in an amount less than a Member would have received under
this Plan, prior to any amendment to the Plan that directly or indirectly affects the
computation of the nonforfeitable percentage of the Member’s rights to his Accrued Benefit,
(the “old vesting provisions”) the Member shall be deemed to have elected the vesting
provisions which would result in the greatest benefit under ERISA, and his deferred vested
Retirement Benefit, in the event the Member ceases to be an Employee, shall be determined
under the new vesting provisions or old new vesting provisions, whichever is most favorable
to the Member.

	B11.4	 	 Withdrawal of Accumulated Member Contributions by Vested Member. A Member who is
entitled to a Retirement Benefit under the provisions of Section B11.1 or B11.2 may, at any
time prior to the date his Retirement Benefit payments commence and upon written request
filed with the Plan Administrator, elect to withdraw his Accumulated Member Contributions
from the Fund, in which event the Retirement Benefit specified in Section B7.1(b), shall be
reduced (but not below zero) by the Retirement Benefit derived from the Member’s
contributions, determined in accordance with the provisions of Section B5.2.

If a Member ceases to be an Employee, withdraws his Accumulated Member Contributions, and is
reemployed by the Company as an Eligible Employee prior to May 15, 2000, such Member may
repay to the Fund within 2 years of his reemployment the full amount of such withdrawal plus
interest at the effective rate described in Section B2.1, compounded annually, from the date
of the withdrawal to the date of repayment. Upon such repayment, the Member shall be
entitled to the reinstatement of the amount of contributory Retirement Benefit derived from
his contributions which he forfeited under the provisions of this Section B11.4.

 

76

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