Document:

Exhibit 10.1

 

	
STATE OF LOUISIANA
    	
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GROUND LEASE AGREEMENT
    
	
PARISH OF CALCASIEU
    	
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This GROUND LEASE AGREEMENT (“Ground Lease”) is and effective as of July  18, 2012,(the “Effective Date”) by and between CREATIVE CASINOS OF LOUISIANA, L.L.C., a Louisiana limited liability company, whose address is 410 East College Street, Suite A, Lake Charles, LA  70605, appearing through its sole member, Ameristar Lake Charles Holdings, LLC, a Louisiana limited liability company represented by Peter C. Walsh, Manager, duly authorized (the “Tenant”), and LAKE CHARLES HARBOR & TERMINAL DISTRICT, a political subdivision of the State of Louisiana, located in Calcasieu Parish, Louisiana (the “District”).

 

WITNESSETH:

 

WHEREAS, the District is a deep water port and political subdivision of the State of Louisiana (the “State”) exercising governmental powers of the State as delegated and authorized pursuant to the Louisiana Constitution and other statutory supplemental authorities thereof, acting by and through the Executive Director of the District, having its office and domicile at the Port of Lake Charles, Lake Charles, Louisiana; and

 

WHEREAS, the Tenant is desirous of leasing land owned by the District  for development, construction, and operation of a resort, hotel, retail sales outlets, restaurant(s), and casino (“Resort”) facilities; and

 

WHEREAS, the Tenant will obtain all licenses, permits and approvals from the Louisiana Gaming Control Board and the Louisiana Department of Public Safety and Corrections, Riverboat Gaming Enforcement Division of the Office of State Police, necessary to permit the Tenant to operate a casino riverboat at such land; and

 

WHEREAS, the District desires to lease such land to the Tenant in order to develop the land with such a facility and thereby create and provide employment opportunities for the

 

 

inhabitants of the Parish of Calcasieu (the “Parish”), which will add to the welfare and prosperity of the persons residing within the geographic limits of the District and the Parish; and

 

WHEREAS, the District is specifically authorized pursuant to La. R.S. 34:203C to “induce and encourage the location of enterprises which would have economic impact upon the area served by it and lease lands presently owned by it for the general development of tourism...”; and

 

WHEREAS, in accordance with the above, the Tenant has executed this Ground Lease and offers fair value to the District as consideration for this Ground Lease.

 

NOW, THEREFORE, in consideration of the above recitals and the mutual covenants hereinafter contained, the parties herein covenant and agree as follows:

 

1. Definitions.  As used in this Ground Lease, the terms “District,” “Effective Date,” “Ground Lease,” “Parish,” “State,” and “Tenant” shall have the meanings indicated above, and the following terms shall have the respective meanings indicated below:

 

“Applicable Laws” shall mean all present and future laws, ordinances, orders, rules and regulations of all federal, state, parish, and municipal governments, departments, commissions, or offices, in each case having applicable jurisdiction over the Project Site, the District, or the Tenant.

 

“District-Created Lien” means any lien, charge, or encumbrance arising or resulting directly from acts or omissions of the District.

 

“Extended Term” means any ten (10) year extension(s) of this Ground Lease occurring after the Initial Term as provided in Section 3.1 hereof.

 

“Force Majeure” means any cause not reasonably within the control of the party claiming suspension, and shall include, but not be limited to, the following: (i) physical events such as acts of God, landslides, lightning, earthquakes, fires, storms or storm warnings, such as hurricanes, droughts, floods, washouts, explosions, breakage or accident or necessity of repairs to machinery or equipment or lines of pipe; (ii) weather related events affecting an entire geographic region; (iii) acts

 

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of others such as strikes, lockouts or other industrial disturbances, riots, sabotage, terrorism, insurrections or wars; provided that the settlement of strikes, lockouts or other industrial disturbances shall be within the sole discretion of the party claiming such suspension; (iv) the failure or interruption of performance by the Tenant’s engineering, procurement and construction contractor or any subcontractors of such contractor to the extent caused by an event of force majeure under this Ground Lease; (v) the failure or interruption of performance by the Tenant’s suppliers by reason of such supplier’s valid declaration of an event that would constitute an event of force majeure under the Tenant’s contract with such supplier; (vi) governmental actions such as necessity for compliance with any court order, law, statute, ordinance, regulation, or policy having the effect of law promulgated by a governmental authority having jurisdiction, or that restrict the Tenant’s ability to construct the Project or any delay in issuance or effectiveness of any governmental approval that has been properly applied for by the Tenant that is required to construct the Project; and (vii) litigation or other proceedings commenced by any Person other than a Party with respect to the Project.

 

“Ground Lease Commencement Date” means the Effective Date.

 

“Ground Lease Full Rent Commencement Date” means the Effective Date.

 

“Initial Term” means the first ten (10) years of the term of this Ground Lease, as provided in Section 3.1 hereof.

 

“Impositions” means (i) all real or personal property taxes and assessments on the Improvements to be constructed on the Project Site (but not real property taxes on the Project Site itself, nor any income, transfer, gift, inheritance, estate, intangible personal property, corporation, or similar taxes imposed on the District by reason of its ownership of the Project Site or its interest in this Ground Lease), the personal property located on the Project Site and taxes, if any, imposed on the ground rent or other charges paid by the Tenant hereunder or on the Tenant’s interest in or under this Ground Lease, (ii) water and sewer rents, charges for public utilities, governmental excises, levies, license, impact and permit fees, and (iii) other governmental charges which at any time during the term of this Ground Lease may be assessed, levied, confirmed, imposed upon or become due and payable in respect of

 

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or become a lien on the Improvements to be constructed on the Project Site or any part thereof or any appurtenance thereto.

 

“Improvements” means the improvements as described in Exhibit “2” to this Ground Lease as conditioned by the requirements set forth in Exhibit “2”.

 

“Lease Year” means a period of twelve (12) consecutive full calendar months.  The first Lease Year shall begin on the Ground Lease Full Rent Commencement Date; provided, however, if said Ground Lease Full Rent Commencement Date shall occur on other than the first day of a calendar month, then the first Lease Year shall commence upon the first day of the calendar month next following the Ground Lease Full Rent Commencement Date.  Each succeeding Lease Year shall commence upon the anniversary of the beginning of the previous Lease Year.

 

“Option” means Tenant’s right to lease the Project Site pursuant to the terms of the Non-Exclusive Conditional Real Estate Lease Option Agreement (“Option Agreement”).

 

“Person” means and includes natural persons, corporations, general partnerships, limited partnerships, joint stock companies, joint ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts, or other organizations, whether or not legal entities, and governments and agencies and political subdivisions thereof.

 

“Port” or “District” means the Port of Lake Charles or Lake Charles Harbor & Terminal District, as established by Louisiana Revised Statute 34:201, et seq., in the Parish.

 

“Project” means the construction and operation of Resort facilities including riverboat casino operations as described on Exhibit “2” as conditioned by the requirements set forth in Exhibit “2”.

 

“Project Site” means the real property described specifically by the survey attached as Exhibit “1-A” and legal description on Exhibit “1” to this Ground Lease, as well as any Additional Property (as defined in Section 27.2), upon which the Project will be located and which real property is owned by the District and leased by the District to the Tenant pursuant to this Ground Lease.

 

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“Tenant’s Property” means all machinery, vessels, equipment, furniture, furnishings, inventory and other personal property and all severable fixtures of any kind and at any time made, installed, fixed, or placed on, in, or to the Project Site, but shall not include docks, wharves, warehouses, buildings, or other structures or things deemed to be immovable. Tenant and Landlord acknowledge that the riverboat portion of the Project is deemed to be a movable and not an immovable, or a component part of an immovable or a component part of the Project Site.

 

2.            Ground Lease Premises.

 

2.1         Date.  The date of this Ground Lease shall be the Effective Date.

 

2.2         District’s Agreement to Lease.  Upon the terms and conditions hereinafter set forth, and in consideration of the payment of the rents and the prompt performance by the Tenant of the covenants and agreements to be kept and performed by the Tenant under this Ground Lease, the District does lease to the Tenant and the Tenant hereby leases from the District, the Project Site legally described and as shown in that survey attached hereto and made a part hereof as Exhibit “1-A”.  Reasonable egress and ingress from and to the Project Site pursuant to a traffic plan to be mutually agreed upon by the parties under the Option Agreement (as further described in Section 27.2 below), sufficient to permit the Tenant to accomplish its purposes in connection with the Project shall be made available by the District to the Tenant, provided that the exact route over waterways shall be subject to the reasonable control of the District.

 

2.3         Description of Contemplated Improvements.  In consideration of, and as a material inducement to, the District’s execution of this Ground Lease, the Tenant hereby agrees and shall be obligated, during the Term of this Ground Lease, at Tenant’s sole cost, to finance, construct, maintain and operate the Project and the Improvements, as provided for in this Ground Lease.

 

3.            Term.

 

3.1         Initial Term and Extensions.  The Initial Term of this Ground Lease shall be ten (10) years, commencing at 12:01 a.m. on the Ground Lease Full Rent Commencement Date and, unless

 

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sooner terminated as hereinafter provided, ending at 11:59 p.m. on the tenth (10th) anniversary of the last day of the month immediately preceding the Ground Lease Full Rent Commencement Date, provided that if the Ground Lease Full Rent Commencement  is not the first day of a calendar month, the Initial Term shall extend to 11:59 p.m. on the tenth (10th) anniversary of the last day of the month in which the Ground Lease Full Rent Commencement  occurs.  The parties shall enter into a supplemental memorandum setting forth the Ground Lease Full Rent Commencement Date, the Ground Lease Commencement Date, and expiration date of the Initial Term.

 

In consideration of and conditioned upon Tenant being in full compliance with all terms and conditions set forth herein, the District hereby grants unto Tenant the option to lease the Project Site for six (6) additional ten (10) year terms; the first of said terms commencing upon the expiration of the Initial Term and extending for a period of ten (10) years, (hereinafter referred to as “first option term”), and the second of said terms commencing upon the expiration of the first option term and extending for a period of ten (10) years, (hereinafter referred to as “second option term”), and the third of said terms commencing upon the expiration of the second option term and extending for a period of ten (10) years, (hereinafter referred to as “third option term”), and the fourth of said terms commencing upon the expiration of the third option term and extending for a period of ten (10) years, (hereinafter referred to as “fourth option term”), and the fifth of said terms commencing upon the expiration of the fourth option term and extending for a period of ten (10) years, (hereinafter referred to as “fifth option term”), and the sixth of said terms commencing upon the expiration of the fifth option term and extending for a period of ten (10) years, (hereinafter referred to as the “sixth option term”).

 

Each option to extend the lease of the Project Site as set forth above shall automatically occur unless the Tenant elects to terminate this Ground Lease and communicates such election by written notice from the Tenant to the District on or before six (6) months prior to the expiration of the then current lease term.

 

Unless and until this Ground Lease is terminated, all of the terms and conditions of this Ground Lease shall be applicable to the first option term, the second option term, the third option term, the fourth option term, the fifth option

 

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term, and the sixth option term, if any, and the rental shall be determined in accordance with the provisions outlined in Exhibit “3” attached hereto and made a part hereof.

 

4. Rent.

 

4.1 Rent.  Commencing on the Ground Lease Commencement Date and until the Ground Lease Full Rent Commencement Date, Tenant shall pay to the District as annual rental one-half (1/2) of the amount of the annual rental reflected on Exhibit “3” for the first five (5) years of the initial term (but payable one-twelfth (1/12th) each month).  Commencing on the Ground Lease Full Rent Commencement Date, Tenant shall pay to the District as rent the full amount of the rental provided on Exhibit “3”.  Rent for any period of less than one month shall be apportioned based on the number of days in that month.

 

4.2 Due Date.  All rental payments payable after the Ground Lease Full Rent Commencement Date shall be made annually in advance and on or before the fifth working day of the first month of each Lease Year during the entire term of this Ground Lease commencing upon the Ground Lease Full Rent Commencement Date.

 

All rental payments due from the Ground Lease Commencement Date until the Ground Lease Full Rent Commencement Date shall be due monthly in advance on or before the fifth working day of each month following the Ground Lease Commencement Date. The initial rent  shall be due on the Ground Lease Commencement Date and shall be a pro rata amount of such monthly rent as provided in paragraph 4.1,  in the event the Ground Lease Commencement Date is a date other than the first of a calendar month.

 

4.3 Place of Payment.  Rent shall be payable at such place as the District may specify, by written notice to the Tenant, as hereinafter provided, from time to time.

 

4.4 Deposit.  To secure the performance of Tenant’s obligations under this Ground Lease, Tenant, upon execution of this Ground Lease and pursuant to an escrow agreement mutually agreeable to the parties, shall deposit the sum of $5,000,000 cash (the “Deposit”).

 

The deposit shall consist of Tenant’s paid-up rent for the initial twenty-four (24) months of this Ground Lease commencing as of the Ground Lease Commencement Date. Beginning on the

 

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Ground Lease Commencement Date, Escrow agent shall disburse each month to DISTRICT the rent due pursuant to the terms of this Ground Lease. On the Ground Lease Full Rent Commencement Date, DISTRICT shall authorize escrow agent to disburse any remaining balance in the escrow account to CREATIVE.

 

Subject to the notice and cure provisions of Section 17.3 below, in the event Tenant fails to perform any of its obligations under this Ground Lease, the District may apply such deposit to satisfy such obligations of Tenant.

 

The cash deposit shall be deposited in an interest bearing escrow account of a financial institution reasonably acceptable to the DISTRICT. Interest accrued on the deposit shall remain in the account as additional deposit.

 

The cash deposit provided for herein shall be deemed to be security for the full and faithful performance of all terms, conditions and obligations of Tenant under this Ground Lease and, by the terms of such security, the District shall be deemed to have been granted a security device as to such deposit which security interest shall be registered and filed under the provisions of the uniform commercial code as provided by Louisiana law.

 

5. Net Lease; Taxes and Utility Expenses.

 

5.1 Net Lease.  This Ground Lease is a net lease and it is agreed and intended that the Tenant shall pay or cause to be paid all operating costs and Impositions of every kind and nature whatsoever relating to the Project Site except as expressly otherwise provided in this Ground Lease.  The Tenant shall pay to the District absolutely net throughout the term of this Ground Lease, the rent and other payments hereunder, free of any charge, assessments, Impositions, expenses, or deductions of any kind, and without abatement, deduction or set off, except as expressly otherwise provided in this Ground Lease.

 

5.2 Taxes and Utility Expenses.

 

(a) Subject to Section 5.2(b) hereof, the Tenant shall pay or cause to be paid, before any fine, penalty, interest, or cost may be added thereto for the nonpayment thereof, all Impositions.

 

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(b) The Tenant shall bear the burden of and shall make timely remittances of all Impositions and shall file timely, with appropriate governmental units, all returns, statements, and reports legally required with respect thereto.  The Tenant shall promptly remit to any governmental unit any such Imposition, unless the Tenant shall in good faith, with due diligence, and by appropriate judicial or administrative proceedings, contest the validity, applicability, or amount thereof.  The Tenant shall give the District 10 days’ prior written notice of the Tenant’s intent to contest such Imposition.  Any such contest shall be at the Tenant’s sole cost and expense.

 

(c) The Tenant, upon the request of the District, shall furnish to the District, within thirty (30) days after the date when an Imposition becomes delinquent if not paid, official receipts of the appropriate taxing authority or other evidence satisfactory to the District evidencing the payment thereof. The certificate, advice or bill of non-payment of such Imposition issued by the proper official designated by law to make or issue the same or to receive payment of an Imposition shall be prima facie evidence that such Imposition is due and unpaid at the time of the making of such certificate, advice, or bill.

 

(d) Except as expressly otherwise provided herein, nothing contained herein shall modify, amend, or constitute a waiver of, expressly or by implication, any applicable taxes or Imposition with respect to all or any portion of the Project or the operation thereof.

 

5.3 Utility Connections.  The Tenant shall be responsible for obtaining, at its own cost or at no cost to the District, electricity, telephone, water, sewerage, and other utility service to the Project Site. However, at no cost to the District, the District or its other Tenants, may reasonably utilize any gas, water, electrical or other utility easement areas or utility Improvements installed or caused to be installed by Tenant on the Project Site. Any connection or usage charges normally assessed by utility service providers related to such use shall be at the cost of the District.

 

5.4 Utility connections-use by District. As to the items set forth in Section 5.3 to be provided by Tenant, the District or any Tenant of District, their agents, officers, employees, patrons, invitees or customers shall have the right to reasonable access and use provided such access and use shall not

 

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unreasonably interfere with Tenant’s rights or use of its leasehold pursuant to the terms of this Ground Lease, such connections to utilities are separately metered and the cost of the use of such utilities by the District and any of the Districts Tenants shall be borne by the District or any such Tenant.

 

6. Tenant Improvements.

 

The Tenant shall have the right and obligation to finance, construct, and install on the Project Site (in conformity with Section 6.1 hereof), at Tenant’s sole cost, the Project and the Improvements and such related improvements as are incidental thereto, all of which shall remain the property of the Tenant during the term of this Ground Lease.

 

6.1 Conformity to Preliminary Description and Building Code.  A preliminary description of the Project and Improvements is attached hereto as Exhibit “2”. The Project and Improvements shall be constructed and completed in substantial conformity with such preliminary description and conformity with all applicable building codes, laws, rules, regulations and all conditions as set forth in Exhibit “2”.

 

6.2 (This section intentionally left blank.)

 

6.3 Commencement and Completion of Improvements.  The Tenant shall commence construction of the Improvements within six (6) months from the Effective Date of this Ground Lease. The Tenant shall proceed with due diligence to construct and build the Improvements, without any cost, expenses, charge, liability, or obligation to be borne by the District and shall complete the Improvements.  Tenant shall expend on the Improvements an amount equal to the estimated costs set forth in Exhibit “2”, however, Tenant and District acknowledge that such costs are preliminary estimates and actual expenditures may vary by as much  as ten (10%) percent or more. All Improvements shall be completed within twenty-four (24) months from commencement of construction or as specified in Exhibit “2”, except for delays caused not by the actions of Tenant; but primarily by strike, lock-outs, labor disputes, wars, insurrections, riots, fires, weather interference, acts of God, inability to obtain construction materials, governmental regulations or interference, rationing, or other restrictions or conditions or causes unavoidable or reasonably beyond the control of the Tenant.

 

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6.4 Failure to Complete.  Failure to timely complete construction of the Improvements as set forth in Exhibit “2” prior to 24 months after the commencement of construction shall, at the option of the District, constitute an Event of Default under Section 15.1, provided that no such Event of Default shall be deemed to have occurred if the delay was primarily caused by the acts or omissions of a third party.  Any delays in the completion of construction of the Improvements caused primarily by strike, lock-outs, labor disputes, wars, insurrections, riots, fires, weather interference, acts of God, inability to obtain construction materials, governmental regulations or interference, rationing, or other restrictions or conditions or causes unavoidable or reasonably beyond the control of the Tenant shall be deemed reasonable delays, and the time within which the Tenant shall complete the construction of said Improvements and the construction completion date shall be extended by the length of such delay(s).

 

However, in the event that: (a) the United States of America or the State of Louisiana or any federal, state or local political body, agency or instrumentality, takes any action(s) that prohibits or materially affects riverboat casino gaming at the Project Site; or (b) a local option referendum is adopted by the populace of the City of Lake Charles and/or the Parish of Calcasieu prohibiting riverboat gaming by Tenant at the Project Site; Tenant, at its sole option, shall have the right to terminate this Ground Lease and all of its obligations hereunder (except for the liquidated damages set forth in Section 17.4) upon thirty (30) days written notice, but at the option of the District, Tenant shall, at its expense, demolish and remove any partially complete building  on the Project Site. The Tenant shall be entitled to a credit against the penalty for liquidated damages as provided in paragraph 17.4 of this Ground Lease for the cost of such demolition.

 

6.5 District’s Right to Inspect.  Provided that the District shall not unreasonably interfere with the construction of the Improvements, the District, its officers, representatives, agents, and employees shall have the right, at reasonable times and upon reasonable advance notice to the Tenant, to examine and inspect the Improvements in order that the District, its officers, representatives, agents, and employees may be able to determine that same substantially conform to applicable laws, rules, regulations or building codes, including without limitation, the right to observe or conduct reasonable tests of the Improvements to the extent

 

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necessary to determine such substantial conformity.  If any test conducted by the District, its officers, representatives, agents, or employees under this Section 6.5 reveals that the Improvements are not in such substantial conformity, the Tenant shall pay the reasonable costs of such test; otherwise, the cost of all such tests shall be at the District’s expense.

 

6.6 Tenant’s Property.  All Tenant’s Property shall at all times be and remain the sole property of the Tenant.  The Tenant shall be entitled to remove Tenant’s Property from the Project Site at any time during the term of, or within 60 days after the termination of, this Ground Lease provided the Tenant repairs any damage caused by such removal.

 

6.7 Maintenance of Improvements.  During the continuance of this Ground Lease, the Tenant will keep in reasonably good state of repair any and all property, open areas, sea walls, bulkheads, moorings, buildings, fixtures and building equipment that are brought or constructed or placed upon the Project Site by the Tenant, and the Tenant will repair such property as often as may be necessary in order to keep the Improvements in reasonably good repair and condition.

 

6.8 Signs.  The Tenant shall be permitted to place reasonable signs and other means of identification of its business on the Project Site so long as the same comply with applicable statutes, laws, and ordinances.

 

6.9 Alterations.  The Tenant shall be permitted to make improvements to and/or alterations of the Project during the Initial or Extended Term without the District’s approval or consent as long as such alterations and/or improvements do not result in any change of the uses of the Project Site permitted by this Ground Lease and such changes are not contrary to the requirements of Exhibit “2”.

 

7. Tenant’s Surrender of Project Site.

 

7.1 Surrender at End of Ground Lease.  The Tenant shall and will on the last day of the Initial Term hereof, or if extended, on the last day of any Extended Term beyond which this Ground Lease is not extended, or upon any early termination of this Ground Lease for any reason, surrender and deliver the Project Site and the Improvements thereon to the District and, except as provided in Section 13, in good condition and repair (in light of the age, construction, and nature thereof), less normal wear

 

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and tear, free and clear of any liens or encumbrances, except for District-Created Liens, and without any payment by the District to the Tenant of any amounts for the Improvements, or at the option of the District, remove, at the cost of Tenant, all or part of any uncompleted Improvements as may be reasonably determined by the District.  The Tenant shall remove the Tenant’s Property.  The Tenant shall not be required to restore the Project Site to its condition prior to construction of the Improvements or to restore any alterations of the Project Site.

 

7.2 District Not Liable.  The District shall not be responsible for any loss or damage occurring to any real or personal property owned, leased, or operated by the Tenant, its agents, or employees, prior to or subsequent to the termination of this Ground Lease, other than, to the extent permitted by law, for such loss or damage occurring as a result of the negligent conduct or the willful misconduct of the District, its officers, representatives, agents, or employees or the District’s misrepresentations or its breach of or default under this Ground Lease.

 

8.  Use.

 

8.1 No Unlawful Activities.  The Tenant agrees not to make any unlawful use of the Project Site and the Improvements, including without limitation, any use constituting a nuisance of the Project Site or to adjoining or neighboring property.

 

8.2 Permitted Uses; Compliance with Laws; Permits.  The Project Site shall be used by the Tenant to lawfully construct and operate a riverboat gaming vessel in association with a hotel, retail and entertainment complex.  No other use of the Project Site shall be permitted without the consent of the District which consent will not be unreasonably withheld.  Tenant’s use of the Project shall at all times be in compliance with all applicable rules, laws and regulations and Tenant shall obtain and maintain, at its cost, all applicable permits for the construction and maintenance of the Improvements or for Tenant’s use or activities on the Project Site.

 

8.3 Waste.  The Tenant shall not cause, allow, or suffer to exist any waste of the Project Site or the Improvements.

 

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9. Indemnification.

 

9.1 Tenant’s General Agreement to Indemnify.  The Tenant releases the District, its officers, representatives, employees, agents, successors and assigns, (individually and collectively, “District Indemnitee”) from, assumes any and all liability for, and  agrees to indemnify the District Indemnitee against all claims, liabilities, obligations, damages, penalties, litigation, costs, charges, and expenses (including, without limitation, reasonable attorney’s fees, engineers’ fees, architects’ fees, and the costs and expenses of appellate action, if any), imposed on, incurred by or asserted against the District Indemnitee or the District’s interest in real property in the Project Site arising out of (i) the use or occupancy of the Project Site by the Tenant, its officers, representatives, agents, and employees, (ii) the construction or operation of the Project by the Tenant, its officers, representatives, agents, and employees, (iii) any claim arising out of the use, occupancy, operation, or construction of the Project Site by the Tenant, its officers, representatives, agents, and employees, and (iv) activities on or about the Project Site by the Tenant, its officers, representatives, agents, and employees, of any nature, whether foreseen or unforeseen, ordinary, or extraordinary, in connection with the construction use, occupancy, operation, maintenance, or repair of the Project, the Improvements, or the Project Site by the Tenant, its officers, representatives, agents, and employees; provided, however, that any such claim, liability, obligation, damage or penalty litigation, costs, charges, and expenses (including, without limitation, reasonable attorney’s fees, engineers’ fees, architects’ fees, and the costs and expenses of appellate action, if any) arising as a result of the negligence or willful misconduct of the District Indemnitee shall be excluded from this indemnity.  The indemnity provided in this section shall include within its scope any liability imposed by law on the District on a strict liability theory as landowner for physical defects in the Project Site (except for environmental contamination), it being the intention of the parties for Tenant to assume liability for such defects in the Project Site during the term of this Ground Lease.  This section shall include within its scope, but not be limited to, any and all claims or actions for wrongful death, but any and all claims brought under the authority of or with respect to any local, state, or federal environmental statute or regulation shall be covered by Section 9.2 and not this Section 9.1.

 

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9.2 Tenant’s Environmental Indemnification. The Tenant agrees that it will comply in all material respects with all environmental laws and regulations applicable to the Tenant, including without limitation, those applicable to the Tenant’s use, storage, and handling of hazardous substances in, on, or about the Project Site.  The Tenant agrees to indemnify and hold harmless each of the District Indemnitee against and in respect of any and all damages, claims, losses, liabilities, and expenses (including, without limitation, reasonable attorneys, accounting, consulting, engineering, and other fees and expenses), which may be imposed upon, incurred by, or assessed against any of the District Indemnitee by any other party or parties (including, without limitation, a governmental entity), arising out of, in connection with, or relating to the subject matter of:  (a) the Tenant’s breach of the covenant set forth above in this Section 9.2 or (b) any environmental condition of contamination on the Project Site, or any violation of any federal, state, or local environmental law with respect to the Project Site, first occurring after the  Effective Date of this Ground Lease and caused by the Tenant’s operations or facilities.

 

9.3 Burden of Proof.  The Tenant, at its own cost, may cause to be conducted a Phase I and Phase II environmental assessment of the Project Site prior to the commencement of construction of the Improvements and a copy of all written reports issued in connection with such assessment shall be given to the District within five (5) days of completion.  If, as a result of such assessments, environmental contamination of the Project Site is discovered, such contamination shall be deemed to have existed prior to the date of the Ground Lease.  Any condition of environmental contamination discovered on the Project Site after the completion of the environmental assessments (Phase I and Phase II) shall be presumed, for purposes of the Tenant’s agreement to indemnify the District Indemnitee, to have been caused by the Tenant’s operations or facilities, unless the Tenant can demonstrate, by a preponderance of the evidence, that (i) such condition originated off the Project Site, or (ii) such condition was not caused by the Tenant’s operations or facilities.  The provisions of this Section 9.3 are intended only to allocate the burden of establishing causation between the Tenant and the District with respect to environmental contamination discovered before and after the Effective Date of this Ground Lease.  In no event shall any third party other than the District Indemnitee and the Tenant be entitled to any benefit, reliance, or presumption

 

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based on the provisions of causation or liability of either party with respect to any environmental contamination of the Project Site.

 

9.4 Survival of Indemnities. The foregoing indemnities shall survive the term and shall be in addition to any of the District’s or the Tenant’s obligations for breach of a representation or warranty.

 

10. Insurance.

 

10.1 Public Liability.  The Tenant agrees to carry or cause to be carried public liability insurance with respect to the Project Site and the uses and activities of the Tenant thereon in the minimum combined single limit amount of Ten Million ($10,000,000)Dollars for the death of or personal injury to one or more persons and for property damage for each occurrence in connection with the Project Site and the use thereof or activities of the Tenant thereon, and same shall include the District as an additional insured with respect to any matters arising out of this Ground Lease or arising during the term hereof out of the District’s ownership of the Project Site.  Such requirement may be satisfied by Tenant or its parent corporation maintaining blanket public liability insurance covering all of its operations.  Such insurance policy shall contain a provision or be accompanied by a certificate or endorsement to the effect that the insurance company shall not cancel or materially modify such policy without first giving written notice thereof to the District at least thirty (30) days in advance of such cancellation or material modification.  At the District’s request, the Tenant shall promptly provide to the District certificates evidencing such insurance and shall furnish copies of such policies to the District.  The District may change by reasonable amounts, consistent with prevailing commercial practices in the Port of Lake Charles, the limits of insurance coverage required by this Section 10.1 upon ninety (90) days written notice to the Tenant stating such changed limits of coverage and the reasons for the change.

 

10.2 Workers’ Compensation. The Tenant further covenants and agrees, at its expense, to take out and maintain at all times during the term hereof, all necessary workers’ compensation insurance covering all persons employed by the Tenant in and about the Project Site to the extent required by Applicable Laws.

 

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10.3 Qualification for Insurer.  The Tenant may elect to be self-insured subject to the approval of the District, which approval shall not be unreasonably withheld.

 

10.4 Waiver of Subrogation.  As a part of the consideration of this Ground Lease, each of the parties hereby releases the other from all liability for damage due to any act or neglect of the other party which is the result of fire or other casualty to the extent covered by any insurance policy; provided, however, the releases herein contained shall not affect the rights of either party under this Ground Lease to be paid insurance proceeds received by the other or apply such insurance proceeds to loss or damage resulting from the willful or premeditated acts of either of the parties hereto, their agents or employees; and provided further, nothing in this Section shall be interpreted as or have the effect of relieving or modifying any obligation of any insurance company and shall be void if and to the extent it would have such effect.  Any party required by this Ground Lease to maintain any casualty insurance shall make reasonable attempts to obtain the written consent to this waiver of subrogation from its insurer.

 

11. Liens and Mortgages.

 

11.1 Prohibition of Liens and Mortgages.  The Tenant shall not create or permit to be created or to remain in connection with the Project, the Project Site, or the Tenant’s activities thereon, any liens or mortgages against any property interest of the District, and the Tenant shall discharge any lien, encumbrance, or charge (levied on account of any Imposition or any mechanics’, laborers’, or materialmen’s lien or security agreement) which might be or become a lien, encumbrance, or charge upon the District’s interest in the Project Site or any part thereof in accordance with Section 11.2 hereof.

 

11.2 Discharge of Liens.  If any mechanics’, laborers’, or materialmen’s lien (other than a District-Created Lien) shall at any time be filed against the District’s interest in the Project Site or any part thereof in connection with the Project or the Tenant’s activities thereon, the Tenant, within 30 days after notice of the filing thereof, shall elect to contest the same or cause the same to be discharged of record by payment, deposit, bond, order of a court of competent jurisdiction or otherwise.  If the Tenant does not contest such lien and shall fail to cause such lien to be discharged within the period aforesaid, then, in addition to any other right or remedy of the District hereunder,

 

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the District may, but shall not be obligated to, discharge the same either by paying the amount claimed to be due or by procuring the discharge of such lien by deposit or by bonding proceedings, and in any such event the District shall be entitled, if the District so elects, to compel the prosecution of an action for the foreclosure of such lien by the lien holder with interest, attorneys’ fees, costs, and allowances.  Any amount so paid by the District and all costs and expenses incurred by the District in connection therewith, including reasonable attorneys’ fees together with interest thereon at one percent (1%) per annum above the prime rate of interest quoted from time to time by Bank of America, New York, as Bank of America’s Prime Rate, from the respective dates of the District’s making of the payment or incurring of the cost and expense, shall constitute additional rent payable by the Tenant under this Ground Lease and shall be paid by the Tenant to the District within fifteen (15) days of written demand therefor.

 

11.3 District Not Liable For Mechanic’s Liens.  Nothing herein contained shall be deemed or construed in any way to constitute the consent of or request by the District, express or implied, to a contractor, subcontractor, laborer or materialman for the performance of any labor or the furnishing of any materials for any specific improvement, alteration to or repair of the Project Site, the Improvements or any part thereof.  NOTICE IS HEREBY GIVEN THAT THE DISTRICT SHALL NOT BE LIABLE FOR ANY LABOR OR MATERIALS FURNISHED OR TO BE FURNISHED TO THE TENANT UPON CREDIT AND THAT NO MECHANIC’S OR OTHER LIEN FOR ANY SUCH LABOR OR MATERIALS SHALL ATTACH TO OR AFFECT THE REVERSIONARY OR OTHER INTEREST OF THE DISTRICT IN AND TO THE PROJECT SITE AND THE IMPROVEMENTS THEREON.

 

11.4 Rights of Ground Leasehold Mortgages.  The District agrees that it shall execute such agreements and certificates with the holder or prospective holder of any mortgage or similar lien instrument (a “Mortgagee”) encumbering the Tenant’s interests in the Project Site (a “Ground Leasehold Mortgage”) as the Tenant or such Mortgagee may from time to time reasonably require.  As a condition precedent to the District’s obligations under this Section 11.4, the Tenant must notify the District in writing of any Mortgagee that holds a Ground Leasehold Mortgage, and such notice shall include the name of the Mortgagee and its address for the purpose of all communications required to be given to such Mortgagee under this Section 11.4.  Provided the District is so notified, the District agrees with the Tenant and

 

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with the specific intent to expressly benefit any such Mortgagee, as follows:

 

(a) Consent to Ground Leasehold Mortgages.  The District acknowledges that this Ground Lease and all of the Tenant’s rights and interests in the Project Site may be encumbered without the District’s consent and that this Ground Lease, any new lease executed pursuant to part (f) of this Section and all Ground Leasehold Mortgages shall be prior to all mortgages or other lien instruments encumbering the District’s interest in the Project Site.

 

(b) No Modifications.  No modifications to this Ground Lease made after the District has received notice of any Mortgagee shall be effective unless the same are first approved in writing in each instance by each such Mortgagee.

 

(c) Rights to Notices.  The District shall give to each Mortgagee a copy of all notices pertaining to this Ground Lease, including all notices regarding any alleged default under this Ground Lease, the termination of this Ground Lease or any demand to remedy any claimed default.  Such notices shall be given in writing simultaneously with the notices given to the Tenant and no notice by the District to the Tenant shall be deemed to have been duly given under this Ground Lease unless and until a true and complete copy thereof has been so provided to every Mortgagee.

 

(d) Rights to Cure.  Each Mortgagee shall have a period of sixty (60) days following its receipt of written notice of any default under this Ground Lease to cause such default to be cured, and this Ground Lease shall not be subject to cancellation unless such cure period expires without such default being cured in all material respects; provided, however, such period shall be extended so as to permit the Mortgagee to acquire possession of the Project Site for any cure which requires such possession; and provided further, this Ground Lease shall not be subject to cancellation by the District for any default, including insolvency, bankruptcy, and receivership proceedings related to the Tenant, which the Mortgagee has no reasonable means to cure so long as all rental and monetary defaults are cured within that aforesaid period.  Any Mortgagee shall have the right to interplead any sums in dispute and this Ground Lease may not be canceled as a result of such interpleader.

 

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(e) No Terminations.  Except as specifically provided in part (d) of this Section, this Ground Lease shall not be subject to termination, cancellation or forfeiture, nor may the Tenant’s interest herein be surrendered or any such surrender accepted by the District, without the prior written consent of each Mortgagee.  The District and the Tenant acknowledge that this limitation shall apply to any right of the Tenant to cancel this Ground Lease as a result of any condemnation, damage by casualty, frustration of purpose or failure of any condition set forth in this Ground Lease.

 

(f) New Ground Lease.  If this Ground Lease is terminated or extinguished for any reason, including by rejection of any receiver or trustee in bankruptcy or by operation of law, the District agrees to enter into a new lease with the Mortgagee with the same priority as this Ground Lease.  If there exists more than one Mortgagee, each Mortgagee shall be offered the opportunity to enter into such new lease in the order of the priority of their Ground Leasehold Mortgages and each Mortgagee shall be given fifteen (15) days following written notice to exercise such option.  The new lease shall be on the same terms and conditions contained in this Ground Lease, shall be for the remainder of the term which would otherwise then exist under this Ground Lease, and include the same extension options as are granted to the Tenant herein.  As a condition to entering into such new lease, the Mortgagee shall be required to pay all past rental and other sums then due to the District under this Ground Lease.

 

(g) Mortgagee’s Liability.  No Mortgagee shall be deemed to have assumed or agreed to perform any of the Tenant’s obligations under this Ground Lease by reason of encumbering the Tenant’s interest in the Project Site, effecting a cure on the Tenant’s behalf under this Ground Lease, by any course of conduct, or otherwise, unless and to the extent such assumption is specifically agreed to in writing executed by such Mortgagee; provided, however, the Mortgagee shall be liable for the Tenant’s monetary obligations under this Ground Lease which are attributable to the period after such Mortgagee acquires the Tenant’s interest in this Ground Lease and before it assigns this Ground Lease to a third party; and provided further, the foregoing limitations of liability shall not be deemed to impair the District’s right to exercise its remedies as a result of a default under this Ground Lease.  In no event shall a Mortgagee be liable for any hazardous waste liability of the Tenant.

 

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(h) Subsequent Assignments.  Regardless of any conditions or limitations upon the assignability of this Ground Lease, any Ground Leasehold Mortgage may be foreclosed and any Mortgagee who acquires the Tenant’s rights under this Ground Lease, or any Person acquiring this Ground Lease at any foreclosure, trustee’s sale, sheriff’s sale, or similar proceeding or by assignment in lieu thereof, shall have the right to assign this Ground Lease to any third party without the District’s consent, provided that such third party (i) intends to use the Project Site for the purposes permitted in this Ground Lease, which purposes are legal and do not conflict with a prior, enforceable, exclusive use covenant or agreement to which the District is a party, and (ii) such third party can reasonably demonstrate its financial capacity to meet the Tenant’s obligations under this Ground Lease.

 

(i) Insurance Proceeds; Condemnation Awards. The District agrees that all condemnation awards and insurance proceeds which otherwise belong to the Tenant may be applied in the manner specified in the Ground Leasehold Mortgage with the highest priority at the time such awards or proceeds are paid, and that no compromises, settlements, or other agreements may be entered into with respect of such awards or proceeds without the prior written consent of the Mortgagee therein.

 

(j) Further Assurances.  The District agrees that it shall execute reasonable amendments to this Ground Lease which do not modify the Tenant’s obligations or materially impair any rights or remedies of the District and shall execute such estoppel certificates and further assurances regarding the status of this Ground Lease and the performance of the District’s and the Tenant’s obligations hereunder as may be reasonably required by any prospective Mortgagee or any prospective purchaser of a Ground Leasehold Mortgage.

 

(k) No Merger.  It is the specific intent of the District and the Tenant, and the District acknowledges for the benefit of any Mortgagee, that the ownership of the District’s reversionary interest and leasehold interests by any one person shall not extinguish any Ground Leasehold Mortgage.

 

(l) Successors.  The terms, covenants, and assurances contained in this Section shall bind the District, its successors, assigns, transferees, and mortgagees, and shall inure to the benefit of any successor of or participant with any

 

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Mortgagee and any assignee or purchaser of any Ground Leasehold Mortgage.

 

 

 

12. Entry on Premises by District, Etc.

 

12.1 Entry on Premises.  In addition to such rights of entry as are granted to the District pursuant to Section 6.5 hereof, the Tenant shall permit the District and its authorized representatives to enter the Project Site during normal business hours upon reasonable notice, which shall be no less than twenty-four (24) hours in advance, for the purposes of inspecting the Project Site and verifying compliance by the Tenant with the terms of this Ground Lease, subject to applicable rules and regulations of the State of Louisiana concerning gaming operations. Further, the District or any Tenant of District, their agents, officers, employees, patrons, invitees or customers shall be able to reasonably use any roads, streets, sidewalks, walkways, parking areas or other similar areas.

 

13. Destruction by Fire or Other Casualty.

 

If Improvements erected on the Project Site shall be destroyed or so damaged by fire or any other casualty whatsoever, not due to the willful misconduct of the Tenant, where repair or restoration cannot be reasonably accomplished within one hundred and twenty (120) days of the date of such fire or casualty, the Tenant, by written notice to the District accompanied by a certified copy of a resolution of the Board of Managers of the Tenant to such effect, may, at its election, decide not to restore nor reconstruct the Improvements and may cancel this Ground Lease.  In the event that the Tenant so decides not to restore or reconstruct the destroyed or damaged Improvements and cancel this Ground Lease, the Tenant shall notify the District thereof in writing and shall proceed with due diligence to demolish and remove any ruins or rubble from the destroyed or damaged Improvements remaining on the Project Site at the Tenant’s sole cost and expense, so as to return the portion of the Project Site on which the destroyed or damaged Improvements were situated as nearly as reasonably practicable to the condition thereof at the date of the Ground Lease.  Any such cancellation of this Ground Lease shall be effective as of the date the Tenant completes such demolition and removal work,

 

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and all unaccrued liability of the Tenant hereunder shall thereupon terminate.

 

14. Restriction on Assignments and Transfers.

 

The Tenant shall not assign this Ground Lease, in whole or in part, or sublet all or any portion of the Project Site, without the consent of the District, which consent shall not be unreasonably withheld, delayed, or conditioned.  The District agrees that any portion of the Project Site may be subleased by the Tenant so long as the Tenant continues to be responsible for the performance of all of its obligations under this Ground Lease and the sublessee’s intended use of the Project Site is consistent with those uses permitted of the Tenant hereunder or is otherwise approved by the District.  However, in the event of a total assignment or sublease of substantially all of the Project Site to an Assignee/sublessee, where the Assignee/sublessee can reasonably demonstrate its financial capacity to meet the Tenant’s obligations under this Ground Lease, the Tenant shall be released from any further obligation.  In addition, the District acknowledges that no approval or consent shall be required in connection with an assignment of this Ground Lease for security purposes for any financing permitted hereby, or which is to any entity which controls, is controlled by, or under common control with, the Tenant, or is a result of any merger or acquisition of the capital stock or assets of the Tenant so long as the surviving entity is fully responsible for all of the obligations of the Tenant hereunder.

 

15. Statement of Conditions. During the term of this Ground Lease, Tenant shall abide by the terms and conditions of the Statement of Conditions as established by the Louisiana Gaming Control Board.

 

16. (This section intentionally left blank.)

 

17. Events of Default of Tenant.

 

Except for a termination by Tenant pursuant to Section 3.1 or Section 18.2, if any one or more of the following events shall happen and not be remedied as herein provided an Event of Default shall be deemed to have occurred:

 

17.1 Breach of Special Covenants. Subject to the provisions of Sections 25 and 6.4, if the Tenant shall fail to commence construction of the Improvements when required pursuant to

 

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Section 6.3 or fail to complete construction of the Improvements when required pursuant to Section 6.4; or

 

17.2 Breach of Covenant.  If default shall be made by the Tenant in the performance of or compliance with any of the covenants, agreements, terms, or conditions contained in this Ground Lease other than those referred to in the foregoing Section 17.1, and such default shall continue for a period of sixty (60) days after written notice thereof from the District to the Tenant specifying the nature of such default and the acts required to cure the same, or, in the case of a default or a contingency which cannot with due diligence be cured within such period of sixty (60) days, the Tenant fails to proceed with all due diligence within such period of sixty (60) days, to commence cure of the same and thereafter to prosecute the curing such default with all due diligence (it being intended that in connection with a default not susceptible of being cured with due diligence within sixty (60) days that the time of the Tenant within which to cure same shall be extended for such period as may be necessary to complete the same with all due diligence).

 

17.3 District’s Remedies. Cure.

 

(a) Right to Terminate.  Upon the occurrence of an Event of Default, the District shall be entitled to give written notice to the Tenant stating that this Ground Lease and the term hereby demised shall expire and terminate on the date specified by such notice, and this Ground Lease, the term hereby demised, and the rights of the Tenant under this Ground Lease shall expire and terminate unless such default is fully remedied in a timely manner and all arrears of rent, and all other amounts payable by the Tenant under this Ground Lease, in each case within sixty (60) days from the date of such notice, together with interest thereon at the rate provided by law for judicial interest from the time when the same became due and payable, and all costs and expenses reasonably incurred by or on behalf of the District as a result of the Event of Default, including reasonable attorneys’ fees, shall have been fully and promptly paid by the Tenant to the District and all other defaults shall have been fully cured and made good or cured to the reasonable satisfaction of the District, in either of which events the consequences of such Event of Default and notice of the same shall be deemed to be annulled.

 

(b) Right to Cure.  Upon the occurrence of an Event of Default and the Tenants failure to proceed with all due

 

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diligence to commence cure of the same and thereafter to prosecute the curing of such Events of Default, the District may take whatever actions are reasonably necessary to cure such Event of Default, including the hiring of attorneys, contractors, consultants, architects, engineers, laborers, or others, purchasing the required goods or services and procuring necessary insurance or performance bonds. The Tenant shall be responsible for all costs, including attorney’s fees and the fees of other professionals, reasonably incurred by the District pursuant to this Section and such costs shall be billed to the Tenant in addition to any and all rent due hereunder.  The Tenant shall pay all such additional costs and charges within fifteen (15) days after billing by the District.

 

(c) Injunctions and Damages.  Upon the occurrence of any Event of Default hereunder and the failure of the Tenant to cure such Event of Default within any cure period provide for in this Ground Lease, the District at any time thereafter shall have the right to enjoin such breach and to invoke any right and remedy allowed herein, by law or in equity (except for the right of specific performance), or by statute or otherwise including, without limitation, remedies at law for damages and for reimbursement of expenses to the District in connection with any such action, including reasonable attorney’s fees, costs, and appellate expenses.

 

17.4 Taking of Possession; Acceleration of Ground Rent.  Upon any expiration or termination of this Ground Lease or any termination by summary proceedings or otherwise, (a) the Tenant shall quit and peacefully surrender the Project Site to the District, without any payment therefor by the District, and the District, upon or at any time after any such expiration or termination, may, without further notice, enter upon and re-enter the Project Site, by summary proceedings, ejectment, or otherwise, and may dispossess the Tenant and remove the Tenant and all other persons and property from the Project Site and may have, hold, and enjoy the Project Site and the right to receive all rental income of and from the same; and (b) except as set forth below, if Tenant is in default of the Ground Lease, the District shall be entitled to collect forthwith upon such termination as penalty or liquidated damages the amount, if any, equal to FIVE MILLION AND NO/100THS DOLLARS ($5,000,000.00) ; and (c) all obligations of the Tenant hereunder for additional rent, or Impositions, or any portion thereof arising or accruing with respect to any period prior to such termination and any obligations of the Tenant under the indemnification provisions

 

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hereof arising or accruing with respect to any period prior to such termination hereof, in each case without regard to whether such matter is first noticed to the District prior to or subsequent to such termination, shall survive the termination hereof.

 

Notwithstanding the above and foregoing, upon the commencement of operations of the resort and casino, the amount of liquidated damages referenced in Section 17.4 (b) shall no longer be the sum of FIVE MILLION AND NO/100THS DOLLARS ($5,000,000.00)  but instead shall be calculated as follows:

 

17.4.1   If the casino is operating as of the date on which the default occurs and is anticipated to continue to operate, liquidated damages shall be an amount equal to the average monthly rent paid or payable by Tenant for the previous twelve month period multiplied by the number of full months remaining in the lease, exclusive of any option periods that have not been exercised.

 

17.4.2 If the casino is not operating as of the date on which the default occurs or is not anticipated to continue to operate, liquidated damages shall be an amount equal to the rent and other payments made to the Port in the previous 12 months (excluding reimbursement of expenses or similar items but including payments made under or in lieu of a Joint Revenue Sharing Agreement) multiplied by the number of full months remaining in the lease, exclusive of any option periods that have not been exercised.

 

17.5 Agent for Service.  The Tenant shall maintain a registered agent of the Tenant for service of process, which agent will be located within the State of Louisiana.  The Tenant shall provide the name and address of such agent or any successor agent to the District in writing prior to the commencement of the lease term.  If the Tenant shall fail to maintain such a registered agent within the State of Louisiana, service of process may be accomplished by public posting on the Project Site in the same manner and for the same period as provided in Louisiana statutes, with written notice becoming effective at the time of posting.

 

18. Events of Default of the District.

 

18.1 District’s Event of Default.  Any failure of the District to comply with any of its obligations under this Ground

 

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Lease shall constitute a “District’s Event of Default” hereunder if such failure continues for thirty (30) days after the Tenant gives the District written notice thereof and the acts required to cure the same.

 

18.2 Termination of Ground Lease.  In the event of a District’s Event of Default of the District under this Ground Lease, the Tenant may cancel this Ground Lease by written notice to the District.  Except to the extent the Tenant is otherwise indebted to the District, all deposits, unearned rent and other unearned payments by the Tenant under this Ground Lease shall be returned to the Tenant immediately upon such cancellation.

 

18.3 Right to Cure.  Upon the occurrence of a District’s Event of Default, the Tenant may take whatever actions are reasonably necessary to cure such Event of Default, including the hiring of attorneys, contractors, consultants, architects, engineers, laborers, or others, purchasing the required goods or services and procuring necessary insurance.  The District shall be responsible for all costs including attorneys’ fees and the fees of other professionals, reasonably incurred by the Tenant pursuant to this Section and such costs shall be billed to the District.  The District shall pay all such additional costs and charges within fifteen (15) days after billing by the Tenant.

 

18.4 Tenant’s Right to Damages.  Except to the extent specifically waived in this Ground Lease, the Tenant shall have the right, with or without canceling this Ground Lease, to recover from the District damages caused by a District’s Event of Default.

 

19. Mutual Obligations.

 

19.1 Late Charges; Interest.  If any rent or other sum is not paid when due under this Ground Lease, and if such delinquency continues for a period of ten (10) days after receipt of written notice, such sum shall bear a late charge equal to one-half of one percent (0.005%) of the amount thereof, the parties recognizing and agreeing that such charge represents a reasonable approximation of the additional administrative costs and expenses which are likely to be incurred by the non-defaulting party.  Additionally, any judgment rendered therefor shall bear interest from the date originally due to the date of collection at the rate of prescribed by law as legal interest.

 

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19.2 Obligations to Mitigate Damages.  Both the District and the Tenant shall have the obligation to take reasonable steps to mitigate their damages caused by any default under this Ground Lease.

 

19.3 Failure to Enforce Not a Waiver.  No failure by either party to insist upon the strict performance of any covenant, agreement, term, or condition of this Ground Lease or to exercise any right or remedy arising upon the breach thereof, and no acceptance by the District of full or partial rent during the continuance of any such breach, shall constitute a waiver of any such breach of such covenant, agreement, term, or condition.  No covenant, agreement, term, or condition of this Ground Lease to be performed or complied with by either party and no breach thereof shall be waived, altered, or modified except by a written instrument executed by both parties.  No waiver of any breach shall affect or alter this Ground Lease, but each and every covenant, agreement, term, or condition of this Ground Lease shall continue in full force and effect with respect to any other then existing or subsequent breach hereof.

 

19.4 Rights Cumulative.  Each right and remedy of the parties provided in this Ground Lease shall be cumulative and shall be in addition to every other right or remedy provided for in this Ground Lease or now or thereafter existing at law or in equity or by statute or otherwise (excluding, however, specific performance against the Tenant) and the exercise or beginning of the exercise by the parties of any one or more of such rights or remedies provided for in this Ground Lease or now or hereafter existing at law or in equity or by statute or otherwise shall not preclude the simultaneous or later exercise by the parties of any or all other such rights or remedies provided for in this Ground Lease or now or hereafter existing at law or in equity or by statute or otherwise.

 

20. Notices.

 

20.1 Addresses.  All notices, demands, and requests which may or are required to be given hereunder shall be in writing, delivered by personal service, or shall be sent by facsimile or United States registered or certified mail, return receipt requested, postage prepaid, to the parties at the following numbers and addresses:

 

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To the Tenant:
    	
 
    	
Creative Casinos of   Louisiana, LLC
    
	
 
    	
 
    	
c/o Ameristar   Casinos, Inc.
    
	
 
    	
 
    	
16633 Ventura Blvd.,   Suite 1050
    
	
 
    	
 
    	
Encino, CA 91436
    
	
 
    	
 
    	
Attention: Peter C.   Walsh
    
	
 
    	
 
    	
Telephone No.:
    	
702–567–7048
    
	
 
    	
 
    	
Facsimile No.:
    	
702–733–8478
    
	
 
    	
 
    	
Email:peter.walsh@ameristar.com
    
	
 
    	
 
    	
 
    
	
With a copy to
    	
 
    	
John R. Pohorelsky
    
	
 
    	
 
    	
901 Lakeshore Dr.,   Suite 900
    
	
 
    	
 
    	
Lake Charles, LA 70601
    
	
 
    	
 
    	
Telephone No.:
    	
337–433–9436
    
	
 
    	
 
    	
Facsimile No.:
    	
337–433–4650
    
	
 
    	
 
    	
Email:johnp@sgpgl.com
    
	
 
    	
 
    	
 
    
	
To the District:
    	
 
    	
Executive Director
    
	
 
    	
 
    	
Lake Charles   Harbor & Terminal
    
	
 
    	
 
    	
District
    
	
 
    	
 
    	
150 Marine Street
    
	
 
    	
 
    	
Post Office Box 3753
    
	
 
    	
 
    	
Lake Charles, Louisiana   70602
    
	
 
    	
 
    	
Facsimile No.
    	
(337) 493–3523
    

 

or to such other numbers or addresses as either party may from time to time designate by written notice to the other party hereto at least fifteen (15) days in advance of an effective date stated therein.

 

20.2 When Deemed Delivered.  Notices, demands, and requests which may or shall be served in accordance with Section 20.1 hereof shall be deemed sufficiently served or given for all purposes hereunder at the earlier of (i) the time such notice, demand, or request shall be received by the addressee, or (ii) ten (10) days after posting via United States registered or certified mail, return receipt requested, postage prepaid.

 

21. Quiet Enjoyment; Title.

 

21.1 Quiet Enjoyment.  Subject to the terms and conditions of this Ground Lease, the Tenant, as of the Effective Date and so long as Tenant pays the ground rent and all additional rent, Impositions, and other charges herein provided for and observes and keeps all covenants, agreements, and conditions of this Ground Lease on its part to be kept and performed in all material respects, shall quietly have and enjoy the Project Site

 

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during the term of this Ground Lease, without hindrance or molestation by the District or anyone claiming under or through the District.  This agreement shall be construed as a covenant running with the land.  Nothing in this Section or any other section herein shall constitute a waiver of the District’s exercise of its police powers under the law applicable to third parties generally.

 

As long as this Ground Lease is in effect, the District shall only allow compatible use of the remainder of its property adjacent to the Project Site and will not create or allow the creation of a visual, olfactory or auditory nuisance on said remainder of its property.

 

21.2 District’s Title.  District represents and warrants as a condition of this Ground Lease that it is the sole record holder of good title to the Project Site subject to no cloud(s) or encumbrances which would materially affect the Tenant’s use and enjoyment or peaceable possession of the Project Site or would prevent the Tenant from obtaining a leasehold policy of title insurance insuring its interest in the Project without exceptions to which the Tenant reasonably objects; and that during the term hereof District shall not encumber the Project Site; that it is authorized to make this Ground Lease for the term hereof; that the provisions of this Ground Lease do not and will not conflict with or violate any of the provisions of existing agreements between District and any third party; that the certificate of occupancy, when issued, will allow the Tenant to use the Improvements for the purposes set forth herein, subject to applicable federal, state, and local laws, ordinances, and building codes; and that District will deliver the Project Site free of all tenants and occupants and claims thereto.  District has furnished to Tenant’s counsel a complete and up-to-date abstract of title at District’s sole expense, prior to the execution of this Ground Lease.

 

In addition to the foregoing obligation on behalf of the District to provide quiet and peaceful possession of the Project Site, the District shall use its best efforts to obtain, within a reasonable time, an expressed release of spoils area designation from the U.S. Army, Corps of Engineers, affecting the Project Site and all lands owned or possessed by the District contiguous to the Project Site.

 

22. Non-Merger of Leasehold.  There shall be no merger of this Ground Lease or of the leasehold interest hereby created

 

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with the record owner’s reversionary interest in the Project Site or any part thereof by reason of the fact that the same Person may acquire or hold, directly or indirectly, this Ground Lease or leasehold interest hereby created or any interest in this Ground Lease or in such leasehold interest and the owner’s reversionary interest in the Project Site or any interest therein.

 

23. Eminent Domain.

 

23.1 Complete Condemnation.  If, during the term hereof, the whole of the Project Site shall be taken under the power of eminent domain (or in lieu of or under threat of exercise of such power) by any public or private authority, then this Ground Lease and the term hereof shall cease and terminate as of the date of such taking, provided that the Tenant shall share in the condemnation award as provided herein.  The Tenant may, upon the written approval of the District, continue to occupy the Project Site, subject to the terms of this Ground Lease, for all or such part of the period between the date of such taking and the date when possession of the Project Site shall be taken by the taking authority, and any unearned rent or other charges, if any, paid in advance, shall be refunded to the Tenant. If required, the Tenant shall procure from the applicable governmental authority, at the Tenant’s sole cost and expense, all necessary consents and authorizations to continue to occupy the Project Site from and after the date of such taking.

 

23.2 Partial Condemnation.  If, during the term hereof, any public or private authority shall, under the power of eminent domain (or in lieu of or under threat of exercise of such power), make a taking resulting in the reduction of the surface area of the Project Site by fifteen percent (15%) or more, or of fifteen percent (15%) or more of the value of the Improvements, or resulting in the Tenant’s not being able to use the remainder of the Project Site or Improvements for the purposes contemplated hereby, then the Tenant may, at its election, terminate this Ground Lease by giving the District notice of the exercise of its election within thirty (30) days of the date of notice to the Tenant of such taking.  In the event of termination by the Tenant under this Section 23.2, the term hereof shall cease and terminate as of the last day of the calendar month in which such notice of exercise of its election to terminate has been given, and any unearned rent or other charges, if any, paid in advance, shall be refunded to the

 

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Tenant, and the Tenant shall share in the condemnation award as provided herein.

 

23.3 Rent Adjustment.  In the event that the Tenant does not elect to terminate this Ground Lease pursuant to Section 23.2 above, then this Ground Lease and the term hereof shall continue in full force and effect, and the base annual rent shall be adjusted pro-rata in accordance with the land area of the property actually taken by the condemning authority.

 

23.4 Allocation of Award.  In the event of a complete taking (or partial taking resulting in termination of this Ground Lease) of the Project Site and/or the Improvements, the District shall be entitled to recover that portion of the condemnation award (or settlement) fairly attributable to the value of the land taken. The Tenant shall be entitled to recover that portion of the award fairly attributable to the value of the Improvements taken.  In the event no Improvements are taken, the Tenant shall not be entitled to any portion of the award, and in the event no land is taken, the District shall not be entitled to any portion of the award, unless the Tenant elects to terminate this Ground Lease pursuant to Section 23.2, in which event the award or settlement shall be allocated as provided above. In the event of a partial taking of the Improvements not resulting in a termination, the entire award or settlement shall be paid to the Tenant.  Nothing contained herein shall prohibit the Tenant’s claiming relocation damages or damages for lost profits against the taking authority in any appropriate proceeding.

 

24. Temporary Taking or Other Deprivation.  If, during the term hereof, (i) less than all of the District’s title to all or any portion of the Project Site is taken for temporary use or occupancy, or (ii) any public or private authority takes any action not resulting in a taking of all or any portion of the Project Site but resulting in a right to compensation therefor, such as changing of the grade of any street upon which the Project Site abuts, then, except as otherwise provided in Section 23, the Tenant shall be entitled to make claim for, recover, and retain all awards, whether pursuant to judgment, agreement, or otherwise, recoverable in connection therewith.

 

25. Force Majeure. Provided that notice is given within thirty (30) days of an occurrence of an event of Force Majeure by the Party seeking to invoke and utilize the provisions of this Section, either Party hereto shall be excused from

 

32

 

performing any of its respective obligations or undertakings provided in this Ground Lease, excepting any of its respective obligations or undertakings to pay any sums of money under the applicable provisions hereof, for so long as the performance of such obligations is prevented or significantly delayed, retarded or hindered by any event of Force Majeure.

 

26. (This section intentionally left blank.)

 

27. Miscellaneous.

 

27.1 Intentionally left blank.

 

27.2 Access to Premises.  The District agrees that access to the Project Site will be provided via the Transportation Plan developed under Section 3 of the Option Agreement (the “Transportation Plan”).  Such plan is to mitigate the traffic expected to be generated by the Project, improve the transportation options in the neighborhood and facilitate access to the Project Site.  The District agrees to acquire land (the “Additional Property”) and otherwise facilitate the completion of the Transportation Plan, including the use of the District’s quick-taking expropriation powers, if necessary.  The District shall purchase such Additional Property at its expense and it shall thereafter be deemed to be a part of the Project Site for the purposes hereof.  The annual rent shall thereafter be increased by an amount equal to ten percent (10%) of the purchase price paid by the DISTRICT for such Additional Property.  All other costs related to the Transportation Plan, including wetlands mitigation, surveying, title examination, title curative work, appraisal costs, and any litigation expenses and/or court costs incurred by the DISTRICT in connection with the exercise of eminent domain in acquiring the Additional Property, and construction costs, shall be the responsibility of Tenant.  Other than the specific road entering the Project Site, all other roads in the Transportation Plan, including roads built across the Additional Land, if any, shall be public roads or highways.

 

27.3 Successors.  The covenants, agreements, terms, provisions, and conditions contained in this Ground Lease shall apply to and inure to the benefit of and be binding upon the District and the Tenant and their respective successors and assigns, except as expressly otherwise herein provided, and shall be deemed covenants running with the respective interests of the parties hereto.

 

33

 

27.4 Surviving Covenants.  Each provision of this Ground Lease which may require performance in any respect by or on behalf of either the Tenant or the District after the expiration of the term hereof or its earlier termination shall survive such expiration or earlier termination.

 

27.5 Provisions Deemed Conditions and Covenants.  All of the provisions of this Ground Lease shall be deemed and construed to be “conditions” and “covenants” as though the words specifically expressing or importing covenants and conditions were used to describe each separate provision hereof.

 

27.6 Headings.  The headings and section captions in this Ground Lease are inserted only as a matter of convenience and for reference and in no way define, limit, or describe the scope or intent of this Ground Lease or in any way affect this Ground Lease as to matters of interpretation or otherwise.

 

27.7 No Oral Change or Termination.  This Ground Lease and the exhibits appended hereto and incorporated herein by reference contain the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes any prior agreements or understandings between the parties with respect to the subject matter hereof, and no change, modification, or discharge hereof in whole or in part shall be effective unless such change, modification, or discharge is in writing and signed by the party against whom enforcement of the change, modification, or discharge is sought.  This Ground Lease cannot be changed or terminated orally.

 

27.8 Governing Law; Severability.  This Ground Lease shall be governed by and construed in accordance with the laws of the State of Louisiana.  To the extent permitted by law, the parties hereto shall be deemed to have waived to the maximum extent possible all legal provisions to the end that this Ground Lease shall be enforceable in accordance with its terms.  If any term or provision of this Ground Lease or the application thereof to any Person or circumstance shall, to any extent, be held to be invalid or unenforceable, the remaining provisions of this Ground Lease or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable, shall not be affected thereby, and each term and provision of this Ground Lease shall be valid and enforceable to the fullest extent permitted by law.

 

34

 

27.9 Counterparts.  This Ground Lease may be executed in one or more counterparts, each of which so executed shall be deemed to be an original and all of which together shall constitute but a single document.

 

27.10 Litigation and Venue. In the event that either party must file suit as a result of default on the part of the other, suit shall be filed in the Fourteenth Judicial District Court, State of Louisiana, (Tenant waiving its right to invoke Federal Diversity Jurisdiction) and the prevailing party shall recover all of its attorney fees, costs of court, expert witness fees, or other similar costs or fees incurred in connection with such legal action from the defaulting party.

 

27.11 Gender of Words.  Words of any gender in this Ground Lease shall be held to include masculine or feminine and words denoting a singular number shall be held to include the plural, and plural shall include the singular, whenever the sense requires.

 

27.12 Sovereign Immunity; Statutory Authority. The District represents and warrants that it has the statutory authority to enter into this Ground Lease, that, when executed, this Ground Lease shall be binding and enforceable in accordance with its terms, and that it is not immune from suit or judgment resulting from any claim or action brought against it by the Tenant pursuant to the express terms of this Ground Lease.

 

27.13 Brokers and/or Real Estate Agents.  Neither party to this Ground Lease shall be liable for any real estate brokers’ or leasing agents’ commissions in the absence of a written agreement.

 

27.14 Legal Relationships.  This Ground Lease shall not be interpreted or construed as establishing a partnership or joint venture between the District and the Tenant and neither party shall have the right to make any representations or be liable for the debts or obligations of the other.  Neither party is executing this Ground Lease as an agent for an undisclosed principal.  No third party is intended to be benefited by this contract.

 

27.15 Memorandum of Lease.  At either party’s request, the parties hereto agree to execute and cause to be properly recorded a memorandum of this Ground Lease, sufficient in form

 

35

 

and content to give third parties constructive notice of the Tenant’s interest hereunder.

 

28. Guaranty. Ameristar Casinos, Inc., a Nevada corporation, (the “Guarantor”), has agreed to guaranty the obligations of the Tenant under this Ground Lease by a separate guaranty agreement.

 

 

IN WITNESS WHEREOF, the undersigned parties have executed this Ground Lease as of the date first above written.

 

	
 
    	
 
    	
DISTRICT:
    
	
 
    	
 
    	
 
    
	
WITNESSES:
    	
 
    	
LAKE CHARLES HARBOR &   TERMINAL
    
	
 
    	
 
    	
DISTRICT,
    
	
/s/ Cynthia R.   Beglis
    	
 
    	
 
    	
a political subdivision of the 
    
	
 (signature)
    	
 
    	
State of Louisiana
    
	
Cynthia   R. Beglis
    	
 
    	
 
    	
 
    
	
(print   name)
    	
 
    	
 
    	
By:
    	
/s/ William   J. Rase, III
    	
 
    
	
 
    	
 
    	
 
    	
William J.   Rase, III
    
	
 
    	
 
    	
 
    	
Executive Director
    
	
/s/ Sharon Edwards
    	
 
    	
 
    	
 
    	
 
    
	
 (signature)
    	
 
    	
 
    	
 
    	
 
    
	
Sharon Edwards
    	
 
    	
 
    	
Approved by:
    
	
 (print name)
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
/s/   Michael K. Dees
    	
 
    
	
 
    	
 
    	
 
    	
Michael K. Dees,   General Counsel
    
									

 

36

 

	
 
    	
 
    	
TENANT:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
WITNESSES:
    	
 
    	
CREATIVE CASINOS OF LOUISIANA,   L.L.C.
    
	
 
    	
 
    	
By Ameristar Lake   Charles
    
	
 
    	
 
    	
Holdings, LLC
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
/s/   Robert D. O. Perry
    	
 
    	
 
    	
 
    	
 
    
	
 (signature)
    	
 
    	
 
    	
 
    	
 
    
	
Robert   D. O. Perry
    	
 
    	
 
    	
By:
    	
/s/ Peter C.   Walsh
    
	
 (print name)
    	
 
    	
 
    	
 
    	
Peter C. Walsh, Manager
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
/s/ Ada E. Rodriguez
    	
 
    	
 
    	
 
    	
 
    
	
 (signature)
    	
 
    	
 
    	
 
    	
 
    
	
Ada E. Rodriguez
    	
 
    	
 
    	
 
    	
 
    
	
 (print name)
    	
 
    	
 
    	
 
    	
 
    

 

37

 

LIST OF EXHIBITS

 

	
Exhibit “1”
    	
Project Site   Description
    
	
 
    	
 
    
	
Exhibit “1-A”
    	
Survey
    
	
 
    	
 
    
	
Exhibit “2”
    	
Improvements
    
	
 
    	
 
    
	
Exhibit “3”
    	
Rental
    

 

38

 

EXHIBIT 1

TO

GROUND LEASE AGREEMENT

 

Project Site Description

 

PARCEL 1:

 

THAT CERTAIN TRACT OR PARCEL OF LAND LYING IN LOTS SEVEN (7), EIGHT (8), AND TWELVE (12) OF SECTION TEN (10) AND LOTS SIX (6), ELEVEN (11), TWELVE (12), THIRTEEN (13) AND FOURTEEN (14) OF SECTION ELEVEN (11), AND LOT ONE (1) THE LOUISA HUNTINGTON PARTITION IN SECTION FIFTEEN (15), ALL IN TOWNSHIP TEN (10) SOUTH, RANGE NINE (9) WEST, CALCASIEU PARISH, LOUISIANA, BEING MORE PARTICULARLY DESCRIBED AS FOLLOWS TO-WIT:

 

COMMENCING AT THE SOUTHWEST CORNER OF THE BARTHELEMEW LEBLEU CLAIM OF IRREGULAR SECTION THIRTY-EIGHT (38), TOWNSHIP TEN (10) SOUTH, RANGE NINE (9) WEST, CALCASIEU PARISH, LOUISIANA;

 

THENCE NORTH 22° 21’ 49” EAST, ALONG THE WEST LINE OF SAID BARTHELEMEW LEBLEU CLAIM OF IRREGULAR SECTION THIRTY-EIGHT (38), FOR A DISTANCE OF 254.60 FEET TO THE INTERSECTION WITH THE SOUTH LINE OF SECTION ELEVEN (11), TOWNSHIP 10 SOUTH, RANGE 9 WEST, CALCASIEU PARISH, LOUISIANA;

 

THENCE NORTH 89° 11’ 50” WEST, ALONG SAID SOUTH LINE OF SECTION ELEVEN (11), FOR A DISTANCE OF 263.29 FEET TO THE SOUTHWEST CORNER OF THE SOUTHEAST QUARTER OF THE SOUTHEAST QUARTER (SE/4-SE/4) OF SAID SECTION ELEVEN (11), THE POINT OF BEGINNING OF HEREIN DESCRIBED TRACT;

 

THENCE NORTH 89° 11’ 50” WEST, ALONG SAID SOUTH LINE OF SECTION ELEVEN (11), FOR A DISTANCE OF 1854.88 FEET;

 

THENCE SOUTH 42° 22’ 12” WEST, FOR A DISTANCE OF 143.71 FEET;

 

THENCE SOUTH 00° 48’ 10” WEST, FOR A DISTANCE OF 440.93 FEET;

 

THENCE SOUTH 46° 42’ 25” EAST, FOR A DISTANCE OF 81.37 FEET;

 

THENCE NORTH 85° 47’ 00” EAST, FOR A DISTANCE OF 1231.30 FEET;

 

THENCE SOUTH 37° 53’ 04” EAST, FOR A DISTANCE OF 44.07 FEET TO THE NORTH RIGHT-OF-WAY LINE OF I-210 BYPASS;

 

THENCE SOUTH 79° 33’ 48” WEST, ALONG THE NORTH RIGHT-OF-WAY LINE OF SAID I-210 BYPASS, FOR A DISTANCE OF 30.14 FEET;

 

THENCE SOUTH 85° 53’ 24” WEST, ALONG THE NORTH RIGHT-OF-WAY LINE OF SAID I-210 BYPASS, FOR A DISTANCE OF 677.86 FEET TO THE WEST LINE OF THE NORTHWEST QUARTER OF THE NORTHEAST QUARTER (NW/4-NE/4) OF THE AFORESAID SECTION FOURTEEN (14);

 

THENCE SOUTH 85° 44’ 18” WEST, ALONG THE NORTH RIGHT-OF-WAY LINE OF SAID I-210 BYPASS, FOR A DISTANCE OF 1342.70 FEET TO THE WEST LINE OF THE NORTHEAST QUARTER OF THE NORTHWEST QUARTER (NE/4-NW/4) OF SAID SECTION FOURTEEN (14);

 

39

 

THENCE NORTH 00° 51’ 36” EAST, ALONG THE WEST LINE OF THE NORTHEAST QUARTER OF THE NORTHWEST QUARTER (NE/4-NW/4) OF SAID SECTION FOURTEEN (14), FOR A DISTANCE OF 39.89 FEET;

 

THENCE NORTH 85° 47’ 00” EAST, FOR A DISTANCE OF 550.33 FEET;

 

THENCE NORTH 43° 17’ 35” EAST, FOR A DISTANCE OF 88.83 FEET;

 

THENCE NORTH 00° 48’ 10” EAST, FOR A DISTANCE OF 451.62 FEET;

 

THENCE NORTH 43° 26’ 49” WEST, FOR A DISTANCE OF 150.13 FEET TO THE NORTH LINE OF THE NORTHEAST QUARTER OF THE NORTHWEST QUARTER (NE/4-NW/4) OF SECTION FOURTEEN (14);

 

THENCE NORTH 89° 11’ 50” WEST, ALONG SAID NORTH LINE OF SECTION FOURTEEN (14), FOR A DISTANCE OF 840.80 FEET;

 

THENCE SOUTH 77° 42’ 19” WEST, FOR A DISTANCE OF 109.87 FEET TO THE POINT OF CURVATURE OF A CURVE TO THE RIGHT, HAVING A RADIUS OF 579.00 FEET AND A CENTRAL ANGLE OF 13° 05’ 33”;

 

THENCE SOUTHWESTERLY, ALONG SAID CURVE TO THE RIGHT, FOR AN ARC LENGTH DISTANCE OF 132.30 FEET TO THE POINT OF TANGENT OF SAID CURVE;

 

THENCE NORTH 89° 12’ 07” WEST, FOR A DISTANCE OF 328.63 FEET TO THE POINT OF CURVATURE OF A CURVE TO THE LEFT, HAVING A RADIUS OF 499.00 FEET AND A CENTRAL ANGLE OF 73° 27’ 02”;

 

THENCE SOUTHERLY, ALONG SAID CURVE TO THE LEFT, FOR AN ARC LENGTH DISTANCE OF 639.70 FEET TO THE POINT OF TANGENT OF SAID CURVE;

 

THENCE SOUTH 17° 20’ 50” WEST, FOR A DISTANCE OF 235.96 FEET TO THE NORTH TO BANK OF CLINE CANAL, SAID POINT BEING THE POINT OF CURVATURE OF A CURVE TO THE RIGHT, HAVING A RADIUS OF 275.36 FEET AND A CENTRAL ANGLE OF 16° 16’ 23”;

 

THENCE SOUTHERLY, ALONG SAID CURVE TO THE LEFT, FOR AN ARC LENGTH DISTANCE OF 78.21 FEET TO THE SOUTH TOP BANK OF SAID CLINE CANAL;

 

THENCE, MEANDERING ALONG SAID SOUTH TOP BANK OF CLINE CANAL, IN A GENERAL DIRECTION OF NORTH 68° 55’ 53” WEST, FOR A DISTANCE OF 57.44 FEET;

 

THENCE, MEANDERING ALONG SAID SOUTH TOP BANK OF CLINE CANAL, IN A GENERAL DIRECTION OF NORTH 75° 51’ 28” WEST, FOR A DISTANCE OF 100.00 FEET;

 

THENCE, MEANDERING ALONG SAID SOUTH TOP BANK OF CLINE CANAL, IN A GENERAL DIRECTION OF NORTH 74° 59’ 31” WEST, FOR A DISTANCE OF 136.15 FEET;

 

THENCE, MEANDERING ALONG SAID SOUTH TOP BANK OF CLINE CANAL, IN A GENERAL DIRECTION OF SOUTH 89° 05’ 22” WEST, FOR A DISTANCE OF 100.68 FEET;

 

THENCE, MEANDERING ALONG SAID SOUTH TOP BANK OF CLINE CANAL, IN A GENERAL DIRECTION OF NORTH 89° 46’ 43” WEST, FOR A DISTANCE OF 100.45 FEET;

 

THENCE, MEANDERING ALONG SAID SOUTH TOP BANK OF CLINE CANAL, IN A GENERAL DIRECTION OF NORTH 86° 55’ 48” WEST, FOR A DISTANCE OF 100.05 FEET;

 

40

 

THENCE, MEANDERING ALONG SAID SOUTH TOP BANK OF CLINE CANAL, IN A GENERAL DIRECTION OF NORTH 89° 55’ 13” WEST, FOR A DISTANCE OF 52.96 FEET TO A SOUTHERLY EXTENSION OF THE EAST TOP BANK OF PRIEN LAKE (INDIAN BAY);

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 03° 29’ 18” EAST, FOR A DISTANCE OF 129.59 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 04° 01’ 19” EAST, FOR A DISTANCE OF 74.22 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 31° 03’ 22” EAST, FOR A DISTANCE OF 85.27 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 03° 52’ 13” EAST, FOR A DISTANCE OF 118.92 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 12° 54’ 27” WEST, FOR A DISTANCE OF 127.06 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 05° 01’ 54” WEST, FOR A DISTANCE OF 97.66 FEET TO THE SOUTH LINE OF THE SOUTHEAST QUARTER OF THE SOUTHEAST QUARTER (SE/4-SE/4) OF SECTION 10;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 15° 16’ 19” WEST, FOR A DISTANCE OF 232.70 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 41° 39’ 13” WEST, FOR A DISTANCE OF 191.16 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF SOUTH 85° 11’ 32” WEST, FOR A DISTANCE OF 146.47 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 54° 10’ 25” WEST, FOR A DISTANCE OF 132.88 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 76° 28’ 49” WEST, FOR A DISTANCE OF 129.72 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 77° 13’ 10” WEST, FOR A DISTANCE OF 174.64 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 63° 46’ 57” WEST, FOR A DISTANCE OF 305.36 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 40° 34’ 09” WEST, FOR A DISTANCE OF 96.42 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE, IN A GENERAL DIRECTION OF NORTH 03° 28’ 51” WEST, FOR A DISTANCE OF 290.97 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE, IN A GENERAL DIRECTION OF NORTH 06° 59’ 15” EAST, FOR A DISTANCE OF 112.51 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE, IN A GENERAL DIRECTION OF NORTH 08° 47’ 22” WEST, FOR A DISTANCE OF 221.13 FEET;

 

41

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE, IN A GENERAL DIRECTION OF NORTH 17° 45’ 50” WEST, FOR A DISTANCE OF 593.36 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE, IN A GENERAL DIRECTION OF NORTH 12° 16’ 05” WEST, FOR A DISTANCE OF 113.24 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE, IN A GENERAL DIRECTION OF NORTH 05° 02’ 58” WEST, FOR A DISTANCE OF 89.12 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE, IN A GENERAL DIRECTION OF NORTH 18° 50’ 30” EAST, FOR A DISTANCE OF 202.61 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE, IN A GENERAL DIRECTION OF NORTH 33° 07’ 57” EAST, FOR A DISTANCE OF 60.41 FEET;

 

THENCE MEANDERING ALONG SAID EAST TOP BANK OF PRIEN LAKE (INDIAN BAY), IN A GENERAL DIRECTION OF NORTH 64° 16’ 28” EAST, FOR A DISTANCE OF 32.94 FEET TO THE LEFT DESCENDING BANK OF THE CALCASIEU RIVER;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF NORTH 78° 15’ 35” EAST, FOR A DISTANCE OF 252.96 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF SOUTH 86° 03’ 11” EAST, FOR A DISTANCE OF 308.38 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF SOUTH 81° 13’ 23” EAST, FOR A DISTANCE OF 229.29 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF SOUTH 87° 22’ 02” EAST, FOR A DISTANCE OF 531.89 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF NORTH 86° 57’ 14” EAST, FOR A DISTANCE OF 396.48 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF NORTH 76° 32’ 48” EAST, FOR A DISTANCE OF 229.26 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF NORTH 82° 03’ 53” EAST, FOR A DISTANCE OF 103.18 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF NORTH 77° 14’ 13” EAST, FOR A DISTANCE OF 357.96 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF NORTH 75° 10’ 07” EAST, FOR A DISTANCE OF 195.09 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF NORTH 64° 43’ 40” EAST, FOR A DISTANCE OF 401.76 FEET;

 

THENCE MEANDERING ALONG SAID LEFT DESCENDING BANK OF THE CALCASIEU RIVER, IN A GENERAL DIRECTION OF NORTH 63° 49’ 10” EAST, FOR A DISTANCE OF 375.23 FEET TO A POINT LYING 105.00 FEET PERPENDICULAR TO THE ORIGINAL WEST BOUNDARY LINE OF L’AUBERGE DU LAC HOTEL AND CASINO;

 

42

 

THENCE SOUTH 49° 09’ 02” EAST, PARALLEL WITH AND 105.00 FEET WESTERLY OF SAID ORIGINAL WEST BOUNDARY LINE OF L’AUBERGE DU LAC HOTEL AND CASINO, FOR A DISTANCE OF 723.86 FEET;

 

THENCE SOUTH 58° 02’ 36” WEST, FOR A DISTANCE OF 280.83 FEET;

 

THENCE SOUTH 25° 46’ 57” EAST, FOR A DISTANCE OF 378.51 FEET TO THE POINT OF CURVATURE OF A CURVE TO THE LEFT HAVING A RADIUS OF 200.00 FEET AND A CENTRAL ANGLE OF 50° 14’ 07”;

 

THENCE SOUTHEASTERLY, ALONG SAID CURVE TO THE LEFT, FOR AN ARC LENGTH DISTANCE OF 175.35 FEET TO THE POINT OF TANGENT OF SAID CURVE;

 

THENCE SOUTH 75° 40’ 37” EAST, FOR A DISTANCE OF 212.74 FEET TO THE AFORESAID ORIGINAL WEST BOUNDARY LINE OF L’AUBERGE DU LAC HOTEL AND CASINO;

 

THENCE SOUTH 89° 11’ 50” EAST, ALONG SAID ORIGINAL BOUNDARY LINE OF L’AUBERGE DU LAC HOTEL AND CASINO, FOR A DISTANCE OF 200.00 FEET;

 

THENCE SOUTH 00° 53’ 19” WEST, ALONG SAID ORIGINAL WEST BOUNDARY LINE OF L’AUBERGE DU LAC HOTEL AND CASINO, FOR A DISTANCE OF 1671.72 FEET TO A POINT LYING 120.00 FEET NORTH OF THE SOUTH LINE OF THE AFOREMENTIONED SECTION ELEVEN (11);

 

THENCE SOUTH 89° 11’ 50” EAST, 120.00 FEET NORTH OF AND PARALLEL WITH SAID SOUTH LINE OF SECTION ELEVEN (11), FOR A DISTANCE OF 1735.47 FEET TO THE EAST LINE OF THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER (SW/4-SE/4) OF SAID SECTION ELEVEN (11);

 

THENCE SOUTH 00° 46’ 32” WEST, ALONG SAID EAST LINE OF THE SOUTHWEST QUARTER OF THE SOUTHEAST QUARTER (SW/4-SE/4) OF SAID SECTION ELEVEN (11), FOR A DISTANCE OF 120.00 FEET TO THE POINT OF BEGINNING.

 

HEREIN DESCRIBED TRACT CONTAINING 242.800 ACRES, MORE OR LESS.

 

43

 

EXHIBIT “1-A”

 

SURVEY

 

44

 

EXHIBIT “2”

To

Ground Lease Agreement

Improvements

 

The Project shall mean a gaming riverboat, shore and support facilities, and all other amenities as described in the application for license and as presented to the Louisiana Gaming Control Board on December 16, 2010 and February 9, 2011, together with such layout and aesthetic changes as Creative deems desirable and that do not detract from the overall quality of the casino project as described in the application and presentation, which shall include: gaming riverboat, support facilities with restaurant and retail space, hotel facilities with at least 700 guest rooms, including not less than 630 main rooms and 70 VIP suites, pool, and pleasure craft docking facility,  an 18-hole golf course, spa, tennis courts, croquet and falconry facilities, and not less than 3,000 parking spaces, at least 1,000 of which shall be in a parking garage and the balance of which shall be on surface parking lots

 

45

 

EXHIBIT “3”

RENTAL

 

RENTAL INCLUDES ITEMS A, B, and C BELOW:

 

A.         242.800 acres, more or less:

 

Annual Rental for the first five (5) years of the Initial Term shall be $1,311,120.00.  Thereafter, the rental shall be increased each year of the Initial Term and any option period as of the date the rental is owed by an amount determined using the formula set forth below.  The amount of the increase will be determined by multiplying the annual rental of $5400.00 per acre by the percent of change in the most recently published U.S. Department of Labor, Consumer Price Index (CPI-W), all items, South Region, not to exceed five (5%) percent per annum.  The percent change will be computed by comparing the index figure published for the month closest to each Lease Year anniversary date with the same month of the prior year.  For example, if the Ground Lease Commencement Date is March 1, 2011, the adjustment for the annual rental due March 1, 2016 shall be calculated using the index published for the most recent month available prior to March 1, 2011 and comparing it to the index published for the same month of the prior year, subject to the five (5%) percent cap.  The index to be used will be the most recently published U.S. Department of Labor, Consumer Price Index for Wage Earners and Clerical Workers (CPI-W), all items figure, South Region published by the Bureau of Labor Statistics or any successor index published by the Department of Labor.  Rental shall never be less than $5,400.00 per acre and shall only increase in accordance with the above formula.

 

B.          Upon commencement of any gaming at the Project Site and within fifteen (15) days of the end of each month, Tenant shall pay to the District each month the greater of an amount equal to 16.667% of 4.2% of all monthly Net Gaming Proceeds (as defined by the Louisiana Gaming Control Board) or 16.667% of 4.2% of $20,000,000 in monthly Net Gaming Proceeds (the “Head Tax Amount”) as defined in La R.S. 27:44(15).  Payment of the Head Tax Amount may be satisfied in whole or in part by payments actually received by the District under an intergovernmental cooperative agreement between the District, the City of Lake Charles, the Calcasieu Parish Police Jury, and Tenant; the terms of

 

46

 

which shall be subject to the approval of the District which approval shall not be unreasonably withheld or conditioned.

 

C.         The obligation of Creative to pay the amounts set forth in item B above shall supersede and remain in effect despite any provision in any agreement which has or may be entered into by Creative or the District with the Calcasieu Parish Police Jury or the City of Lake Charles relating to any Head Tax Amounts, specifically including the Cooperative Endeavor Development Agreement approved by the City of Lake Charles on August 3, 2011 and approved by the Calcasieu Parish Police Jury on August 4, 2011. Creative further agrees not to enter into any agreement relating to Head Tax Amounts with the Parish or the City which provides for the District to receive less than the amounts specified in Item B above or for Creative not to fully comply with the provisions of B above.

 

47Exhibit 4.1

 

Your plan is an important legal document. This sample plan has been prepared based on our understanding of the desired provisions. It may not fit your situation. You should consult with your lawyer on the plan’s legal and tax implications. Neither Principal Life Insurance Company nor its agents can be responsible for the legal or tax aspects of the plan nor its appropriateness for your situation. If you wish to change the provisions of this sample plan, you may ask us to prepare new sample wording for you and your lawyer to review.

 

 

ENERGYSOLUTIONS, LLC 

401(k) PROFIT SHARING PLAN

 

401(k) Plan CL2008

 

Restated October 1, 2009

 

 

TABLE OF CONTENTS

 

	
INTRODUCTION
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ARTICLE I
    	
 
    	
FORMAT   AND DEFINITIONS
    
	
 
    	
 
    	
 
    
	
Section  1.01
    	
—
    	
Format
    
	
Section  1.02
    	
—
    	
Definitions
    
	
 
    	
 
    	
 
    
	
ARTICLE II
    	
 
    	
PARTICIPATION
    
	
 
    	
 
    	
 
    
	
Section  2.01
    	
—
    	
Active   Participant
    
	
Section  2.02
    	
—
    	
Inactive   Participant
    
	
Section  2.03
    	
—
    	
Cessation   of Participation
    
	
 
    	
 
    	
 
    
	
ARTICLE III
    	
 
    	
CONTRIBUTIONS
    
	
 
    	
 
    	
 
    
	
Section  3.01
    	
—
    	
Employer   Contributions
    
	
Section  3.01A
    	
—
    	
Rollover   Contributions
    
	
Section  3.02
    	
—
    	
Forfeitures
    
	
Section  3.03
    	
—
    	
Allocation
    
	
Section  3.04
    	
—
    	
Contribution   Limitation
    
	
Section  3.05
    	
—
    	
Excess   Amounts
    
	
 
    	
 
    	
 
    
	
ARTICLE IV
    	
 
    	
INVESTMENT   OF CONTRIBUTIONS
    
	
 
    	
 
    	
 
    
	
Section  4.01
    	
—
    	
Investment   and Timing of Contributions
    
	
Section  4.01A
    	
—
    	
Investment   in Qualifying Employer Securities
    
	
 
    	
 
    	
 
    
	
ARTICLE V
    	
 
    	
BENEFITS
    
	
 
    	
 
    	
 
    
	
Section  5.01
    	
—
    	
Retirement   Benefits
    
	
Section  5.02
    	
—
    	
Death   Benefits
    
	
Section  5.03
    	
—
    	
Vested   Benefits
    
	
Section  5.04
    	
—
    	
When   Benefits Start
    
	
Section  5.05
    	
—
    	
Withdrawal   Benefits
    
	
Section  5.06
    	
—
    	
Loans   to Participants
    
	
Section  5.07
    	
—
    	
Distributions   Under Qualified Domestic Relations Orders
    
	
 
    	
 
    	
 
    
	
ARTICLE VI
    	
 
    	
DISTRIBUTION   OF BENEFITS
    
	
 
    	
 
    	
 
    
	
Section  6.01
    	
—
    	
Automatic   Forms of Distribution
    
	
Section  6.02
    	
—
    	
Optional   Forms of Distribution
    
	
Section  6.03
    	
—
    	
Election   Procedures
    
	
Section  6.04
    	
—
    	
Notice   Requirements
    

 

i

 

	
ARTICLE VII
    	
 
    	
REQUIRED   MINIMUM DISTRIBUTIONS
    
	
 
    	
 
    	
 
    
	
Section  7.01
    	
—
    	
Application
    
	
Section  7.02
    	
—
    	
Definitions
    
	
Section  7.03
    	
—
    	
Required   Minimum Distributions
    
	
Section  7.04
    	
—
    	
Transition   Rules
    
	
 
    	
 
    	
 
    
	
ARTICLE VIII
    	
 
    	
TERMINATION   OF THE PLAN
    
	
 
    	
 
    	
 
    
	
ARTICLE IX
    	
 
    	
ADMINISTRATION   OF THE PLAN
    
	
 
    	
 
    	
 
    
	
Section  9.01
    	
—
    	
Administration
    
	
Section  9.02
    	
—
    	
Expenses
    
	
Section  9.03
    	
—
    	
Records
    
	
Section  9.04
    	
—
    	
Information   Available
    
	
Section  9.05
    	
—
    	
Claim   Procedures
    
	
Section  9.06
    	
—
    	
Delegation   of Authority
    
	
Section  9.07
    	
—
    	
Exercise   of Discretionary Authority
    
	
Section  9.08
    	
—
    	
Transaction   Processing
    
	
Section  9.09
    	
—
    	
Voting   and Tender of Qualifying Employer Securities
    
	
 
    	
 
    	
 
    
	
ARTICLE X
    	
 
    	
GENERAL   PROVISIONS
    
	
 
    	
 
    	
 
    
	
Section 10.01
    	
—
    	
Amendments
    
	
Section 10.02
    	
—
    	
Direct   Rollovers
    
	
Section 10.03
    	
—
    	
Mergers   and Direct Transfers
    
	
Section 10.04
    	
—
    	
Provisions   Relating to the Insurer and Other Parties
    
	
Section 10.05
    	
—
    	
Employment   Status
    
	
Section 10.06
    	
—
    	
Rights   to Plan Assets
    
	
Section 10.07
    	
—
    	
Beneficiary
    
	
Section 10.08
    	
—
    	
Nonalienation   of Benefits
    
	
Section 10.09
    	
—
    	
Construction
    
	
Section 10.10
    	
—
    	
Legal   Actions
    
	
Section 10.11
    	
—
    	
Small   Amounts
    
	
Section 10.12
    	
—
    	
Word   Usage
    
	
Section 10.13
    	
—
    	
Change   in Service Method
    
	
Section 10.14
    	
—
    	
Military   Service
    
	
 
    	
 
    	
 
    
	
ARTICLE XI
    	
 
    	
TOP-HEAVY   PLAN REQUIREMENTS
    
	
 
    	
 
    	
 
    
	
Section 11.01
    	
—
    	
Application
    
	
Section 11.02
    	
—
    	
Definitions
    
	
Section 11.03
    	
—
    	
Modification   of Vesting Requirements
    
	
Section 11.04
    	
—
    	
Modification   of Contributions
    

 

PLAN EXECUTION

 

PROTECTED BENEFIT ADDENDUM

 

ii

 

INTRODUCTION

 

The Primary Employer previously established a 401(k) profit sharing plan on July 1, 1990.

 

The RWE NUKEM Corporation 401(k) Retirement Plan was merged with this Plan effective January 1, 2008.

 

The Primary Employer is of the opinion that the plan should be changed. It believes that the best means to accomplish these changes is to completely restate the plan’s terms, provisions and conditions. The restatement, effective October 1, 2009, is set forth in this document and is substituted in lieu of the prior document with the exception of any good faith compliance amendment and any model amendment. Such amendment(s) shall continue to apply to this restated plan until such provisions are integrated into the plan or such amendment(s) are superseded by another amendment.

 

The restated plan continues to be for the exclusive benefit of employees of the Employer. All persons covered under the plan on September 30, 2009, shall continue to be covered under the restated plan with no loss of benefits.

 

It is intended that the plan, as restated, shall qualify as a profit sharing plan under the Internal Revenue Code of 1986, including any later amendments to the Code.

 

This plan includes the statutory, regulatory, and guidance changes specified in the 2008 Cumulative List of Changes in Plan Qualification Requirements (2008 Cumulative List) contained in Internal Revenue Service Notice 2008-108 and the qualification requirements and guidance published before the issuance of such list. The provisions of this plan apply as of the effective date of the restatement unless otherwise specified.

 

1

 

ARTICLE I

 

FORMAT AND DEFINITIONS

 

SECTION 1.01—FORMAT.

 

Words and phrases defined in the DEFINITIONS SECTION of Article I shall have that defined meaning when used in this Plan, unless the context clearly indicates otherwise.

 

These words and phrases have an initial capital letter to aid in identifying them as defined terms.

 

SECTION 1.02—DEFINITIONS.

 

Account means, for a Participant, his share of the Plan Fund. Separate accounting records are kept for those parts of his Account that result from:

 

(a)          Pre-tax Elective Deferral Contributions

 

(b)         Roth Elective Deferral Contributions

 

(c)          Matching Contributions

 

(d)         Qualified Nonelective Contributions

 

(e)          Other Employer Contributions

 

(f)            Rollover Contributions

 

If the Participant’s Vesting Percentage is less than 100% as to any of the Employer Contributions, a separate accounting record will be kept for any part of his Account resulting from such Employer Contributions and, if there has been a prior Forfeiture Date, from such Contributions made before a prior Forfeiture Date.

 

A Participant’s Account shall be reduced by any distribution of his Vested Account and by any Forfeitures. A Participant’s Account shall participate in the earnings credited, expenses charged, and any appreciation or depreciation of the Investment Fund.  His Account is subject to any minimum guarantees applicable under the Annuity Contract or other investment arrangement and to any expenses associated therewith.

 

ACP Test means the nondiscrimination test described in Code Section 401(m)(2) as provided for in subparagraph (d) of the EXCESS AMOUNTS SECTION of Article III.

 

Active Participant means an Eligible Employee who is actively participating in the Plan according to the provisions in the ACTIVE PARTICIPANT SECTION of Article II.

 

ADP Test means the nondiscrimination test described in Code Section 401(k)(3) as provided for in subparagraph (c) of the EXCESS AMOUNTS SECTION of Article III.

 

2

 

Affiliated Service Group means any group of corporations, partnerships or other organizations of which the Employer is a part and which is affiliated within the meaning of Code Section 414(m) and the regulations thereunder. Such a group includes at least two organizations one of which is either a service organization (that is, an organization the principal business of which is performing services), or an organization the principal business of which is performing management functions on a regular and continuing basis.  Such service is of a type historically performed by employees.  In the case of a management organization, the Affiliated Service Group shall include organizations related, within the meaning of Code Section 144(a)(3), to either the management organization or the organization for which it performs management functions. The term Controlled Group, as it is used in this Plan, shall include the term Affiliated Service Group.

 

Alternate Payee means any spouse, former spouse, child, or other dependent of a Participant who is recognized by a qualified domestic relations order as having a right to receive all, or a portion of, the benefits payable under the Plan with respect to such Participant.

 

Annual Compensation means, for a Plan Year, the Employee’s Compensation for the Compensation Year ending with or within the consecutive 12-month period ending on the last day of the Plan Year.

 

Annuity Contract means the annuity contract or contracts into which the Trustee or the Primary Employer enters with the Insurer for guaranteed benefits, for the investment of Contributions in separate accounts, and for the payment of benefits under this Plan.

 

Annuity Starting Date means, for a Participant, the first day of the first period for which an amount is payable as an annuity or any other form.

 

Beneficiary means the person or persons named by a Participant to receive any benefits under the Plan when the Participant dies. See the BENEFICIARY SECTION of Article X.

 

Catch-up Contributions means Elective Deferral Contributions made to the Plan that are in excess of an otherwise applicable Plan limit and that are made by Participants who are age 50 or older by the end of the taxable year. An otherwise applicable Plan limit is a limit in the Plan that applies to Elective Deferral Contributions without regard to Catch-up Contributions, such as the limits on the Maximum Annual Additions, as defined in the CONTRIBUTION LIMITATION SECTION of Article III, the dollar limitation on Elective Deferral Contributions under Code Section 402(g) (not counting Catch-up Contributions), and the limit imposed by the ADP Test.

 

Catch-up Contributions are not subject to the limits on the Maximum Annual Additions, as defined in the CONTRIBUTION LIMITATION SECTION of Article III, are not counted in the ADP Test, and are not counted in determining the minimum allocation under Code Section 416 (but Catch-up Contributions made in prior years are counted in determining whether the Plan is top-heavy).

 

Claimant means any person who makes a claim for benefits under this Plan.  See the CLAIM PROCEDURES SECTION of Article IX.

 

Code means the Internal Revenue Code of 1986, as amended.

 

3

 

Compensation means, except for purposes of the CONTRIBUTION LIMITATION SECTION of Article III and Article XI, the total earnings, except as modified in this definition, from the Employer or a Predecessor Employer that did not maintain this Plan during any specified period.  Earnings exclude earnings while a partner or proprietor of such Predecessor Employer.

 

“Earnings” in this definition means wages, within the meaning of Code Section 3401(a), and all other payments of compensation to an Employee by the Employer (in the course of the Employer’s trade or business) for which the Employer is required to furnish the Employee a written statement under Code Sections 6041(d), 6051(a)(3), and 6052.  Earnings shall be determined without regard to any rules under Code Section 3401(a) that limit the remuneration included in wages based on the nature or location of the employment or the services performed (such as the exception for agricultural labor in Code Section 3401(a)(2)). The type of compensation that is reported in the “Wages, Tips and Other Compensation” box on Form W-2 satisfies this definition.

 

For any Self-employed Individual, Compensation means Earned Income.

 

Except as provided herein, Compensation for a specified period is the Compensation actually paid or made available (or if earlier, includible in gross income) during such period.

 

For Plan Years beginning on or after July 1, 2007, Compensation for a Plan Year shall also include Compensation paid by the later of 2 1/2 months after an Employee’s Severance from Employment with the Employer maintaining the Plan or the end of the Plan Year that includes the date of the Employee’s Severance from Employment with the Employer maintaining the Plan, if the payment is regular Compensation for services during the Employee’s regular working hours, or Compensation for services outside the Employee’s regular working hours (such as overtime or shift differential), commissions, bonuses, or other similar payments, and, absent a Severance from Employment, the payments would have been paid to the Employee while the Employee continued in employment with the Employer.

 

Any payments not described above shall not be considered Compensation if paid after Severance from Employment, even if they are paid by the later of 2 1/2 months after the date of Severance from Employment or the end of the Plan Year that includes the date of Severance from Employment, except, payments to an individual who does not currently perform services for the Employer by reason of qualified military service (as that term is used in Code Section 414(u)(1)) to the extent these payments do not exceed the amounts the individual would have received if the individual had continued to perform services for the Employer rather than entering qualified military service.

 

Back pay, within the meaning of section 1.415(c)-2(g)(8) of the regulations, shall be treated as Compensation for the Plan Year to which the back pay relates to the extent the back pay represents wages and compensation that would otherwise be included in this definition.

 

Compensation paid or made available during a specified period shall include amounts that would otherwise be included in Compensation but for an election under Code Section 125(a), 132(f)(4), 402(e)(3), 402(h)(1)(B), 402(k), or 457(b). Compensation shall also include employee contributions “picked up” by a governmental entity and, pursuant to Code Section 414(h)(2), treated as Employer contributions.

 

4

 

For purposes of determining the amount of Elective Deferral Contributions and Matching Contributions, Compensation shall exclude reimbursements or other expense allowances, fringe benefits (cash and noncash), moving expenses, deferred compensation (other than elective contributions), and welfare benefits.

 

For purposes of the EXCESS AMOUNTS SECTION of Article III, the Employer may elect to use an alternative nondiscriminatory definition of Compensation in accordance with the regulations under Code Section 414(s).

 

For Plan Years beginning on or after January 1, 2002, the annual Compensation of each Participant taken into account in determining contributions and allocations for any determination period (the period over which Compensation is determined) shall not exceed $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 any determination period beginning with or within such calendar year.

 

If a determination period consists of fewer than 12 months, the annual compensation limit is an amount equal to the otherwise applicable annual compensation limit multiplied by a fraction. The numerator of the fraction is the number of months in the short determination period, and the denominator of the fraction is 12.

 

If Compensation for any prior determination period is taken into account in determining a Participant’s contributions or allocations for the current Plan Year, the Compensation for such prior determination period is subject to the applicable annual compensation limit in effect for that determination period. For this purpose, in determining contributions and allocations in Plan Years beginning on or after January 1, 2002, the annual compensation limit in effect for determination periods beginning before that date is $200,000.

 

Compensation means, for a Leased Employee, Compensation for the services the Leased Employee performs for the Employer, determined in the same manner as the Compensation of Employees who are not Leased Employees, regardless of whether such Compensation is received directly from the Employer or from the leasing organization.

 

Compensation Year means the consecutive 12-month period ending on the last day of each Plan Year, including corresponding periods before July 1, 1990.

 

Contingent Annuitant means an individual named by the Participant to receive a lifetime benefit after the Participant’s death in accordance with a survivorship life annuity.

 

Contributions means Employer Contributions and Rollover Contributions as set out in Article III, unless the context clearly indicates only specific contributions are meant.

 

Controlled Group means any group of corporations, trades, or businesses of which the Employer is a part that is under common control.  A Controlled Group includes any group of corporations, trades, or businesses, whether or not incorporated, which is either a parent-subsidiary group, a brother-sister group, or a combined group within the meaning of Code Section 414(b), Code Section 414(c) and the regulations thereunder and, for purposes of determining contribution limitations under the CONTRIBUTION LIMITATION SECTION of Article III, as modified by Code Section 415(h). The term Controlled Group, as it is used in this Plan, shall include the term Affiliated Service Group and any other

 

5

 

employer required to be aggregated with the Employer under Code Section 414(o) and the regulations thereunder.

 

Designated Beneficiary means the individual who is designated by the Participant (or the Participant’s surviving spouse) as the Beneficiary of the Participant’s interest under the Plan and who is the designated beneficiary under Code Section 401(a)(9) and section 1.401(a)(9)-4 of the regulations.

 

Direct Rollover means a payment by the Plan to the Eligible Retirement Plan specified by the Distributee.

 

Discretionary Contributions means discretionary contributions made by the Employer to fund this Plan. See the EMPLOYER CONTRIBUTIONS SECTION of Article III.

 

Distributee means an Employee or former Employee. In addition, the Employee’s (or former Employee’s) surviving spouse and the Employee’s (or former Employee’s) spouse or former spouse who is the Alternate Payee under a qualified domestic relations order, as defined in Code Section 414(p), are Distributees with regard to the interest of the spouse or former spouse.

 

Earned Income means, for a Self-employed Individual, net earnings from self-employment in the trade or business for which this Plan is established if such Self-employed Individual’s personal services are a material income producing factor for that trade or business. Net earnings shall be determined without regard to items not included in gross income and the deductions properly allocable to or chargeable against such items. Net earnings shall be reduced for the employer contributions to the employer’s qualified retirement plan(s) to the extent deductible under Code Section 404.

 

Net earnings shall be determined with regard to the deduction allowed to the employer by Code Section 164(f) for taxable years beginning after December 31, 1989.

 

Elective Deferral Contributions means contributions made by the Employer in accordance with elective deferral agreements between Eligible Employees and the Employer.

 

Elective deferral agreements shall be made, changed, or terminated according to the provisions of the EMPLOYER CONTRIBUTIONS SECTION of Article III.

 

Elective Deferral Contributions shall be 100% vested and subject to the distribution restrictions of Code Section 401(k) when made. See the WHEN BENEFITS START SECTION of Article V.

 

Elective Deferral Contributions means Pre-tax Elective Deferral Contributions and Roth Elective Deferral Contributions, unless the context clearly indicates only one is meant.

 

Eligibility Break in Service means an Eligibility Computation Period in which an Employee is credited with 500 or fewer Hours of Service. An Employee incurs an Eligibility Break in Service on the last day of an Eligibility Computation Period in which he has an Eligibility Break in Service.

 

Eligibility Computation Period means a consecutive 12-month period. The first Eligibility Computation Period begins on an Employee’s Employment Commencement Date. Later Eligibility Computation Periods shall be consecutive 12-month periods ending on the last day of each Plan Year that begins after his Employment Commencement Date.

 

6

 

To determine an Eligibility Computation Period after an Eligibility Break in Service, the Plan shall use the consecutive 12-month period beginning on an Employee’s Reemployment Commencement Date as if his Reemployment Commencement Date were his Employment Commencement Date.

 

Eligibility Service means one year of service for each Eligibility Computation Period that has ended and in which an Employee is credited with at least 1,000 Hours of Service.

 

However, Eligibility Service is modified as follows:

 

Service with a Predecessor Employer that did not maintain this Plan included:

 

An Employee’s service with a Predecessor Employer that did not maintain this Plan shall be included as service with the Employer. This service excludes service performed while a proprietor or partner.

 

Prior Employer service included:

 

An Employee’s service with a Prior Employer shall be included as service with the Employer. An Employee’s service with such Prior Employer shall be counted only if service continued with the Employer without interruption.

 

Period of Military Duty included:

 

A Period of Military Duty shall be included as service with the Employer to the extent it has not already been credited. For purposes of crediting Hours of Service during the Period of Military Duty, an Hour of Service shall be credited (without regard to the 501 Hour of Service limitation) for each hour an Employee would normally have been scheduled to work for the Employer during such period.

 

Controlled Group service included:

 

An Employee’s service with a member firm of a Controlled Group while both that firm and the Employer were members of the Controlled Group shall be included as service with the Employer.

 

Eligible Employee means any Employee of the Employer excluding the following:

 

Bargaining class.  Represented for collective bargaining purposes by any collective bargaining agreement between the Employer and employee representatives, if retirement benefits were the subject of good faith bargaining and if two percent or less of the Employees who are covered pursuant to that agreement are professionals as defined in section 1.410(b)-9 of the regulations.  For this purpose, the term “employee representatives” does not include any organization more than half of whose members are Employees who are owners, officers, or executives of the Employer.

 

7

 

Nonresident alien, within the meaning of Code Section 7701(b)(1)(B), who receives no earned income, within the meaning of Code Section 911(d)(2), from the Employer that constitutes income from sources within the United States, within the meaning of Code Section 861(a)(3), or who receives such earned income but it is all exempt from income tax in the United States under the terms of an income tax convention.

 

Leased Employee.

 

An Employee considered by the Employer to be an independent contractor, or the employee of an independent contractor, who is later determined by the Internal Revenue Service to be an Employee.

 

Defined term Employee.

 

Project Employee.

 

Temporary or part-time Employee.

 

However, to the extent an Employee becomes an Employee as a result of a Code Section 410(b)(6)(C) transaction, that Employee shall not be an Eligible Employee during the period beginning on the date of the transaction and ending on the last day of the first Plan Year beginning after the date of the transaction. This period is called the transition period. The transition period may end earlier if there is a significant change in the coverage under the Plan or if the Employer chooses to cover all similarly situated Employees as of an earlier date. A Code Section 410(b)(6)(C) transaction is an asset or stock acquisition, merger, or similar transaction involving a change in the employer of the employees of a trade or business.

 

Eligible Retirement Plan means an eligible plan under Code Section 457(b) which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan, an individual retirement account described in Code Section 408(a), an individual retirement annuity described in Code Section 408(b), for taxable years beginning on or after January 1, 2008, an individual retirement plan described in Code Section 408A(b) subject to any limitations described in Code Section 408A(c), an annuity plan described in Code Section 403(a), an annuity contract described in Code Section 403(b), or a qualified plan described in Code Section 401(a), that accepts the Distributee’s Eligible Rollover Distribution. The definition of Eligible Retirement Plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the Alternate Payee under a qualified domestic relations order, as defined in Code Section 414(p).

 

For taxable years beginning on or after January 1, 2006, if any portion of an Eligible Rollover Distribution is attributable to payments or distributions from a designated Roth account, an Eligible Retirement Plan with respect to such portion shall include only (i) another designated Roth account of the individual from whose Account the payments or distributions were made under an annuity plan described in Code Section 403(a) or a qualified plan described in Code Section 401(a); (ii) another designated Roth account of such individual under an annuity contract described in Code Section 403(b); or (iii) a Roth IRA described in Code Section 408A of such individual.

 

8

 

Eligible Rollover Distribution means any distribution of all or any portion of the balance to the credit of the Distributee, except that an Eligible Rollover Distribution does not include: (i) any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the Distributee or the joint lives (or joint life expectancies) of the Distributee and the Distributee’s Designated Beneficiary, or for a specified period of ten years or more; (ii) any distribution to the extent such distribution is required under Code Section 401(a)(9); (iii) any hardship distribution; (iv) the portion of any other distribution(s) that is not includible in gross income (determined without regard to the exclusion for net unrealized appreciation with respect to employer securities); and (v) any other distribution(s) that is reasonably expected to total less than $200 during a year.

 

A portion of a distribution shall not fail to be an Eligible Rollover Distribution merely because the portion consists of after-tax employee contributions that are not includible in gross income. However, such portion may be transferred only to (i) an individual retirement account or individual retirement annuity described in Code Section 408(a) or (b); (ii) for taxable years beginning on or after January 1, 2007, a qualified plan (defined contribution or defined benefit) or an annuity contract described in Code Section 403(b) 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; or (iii) for taxable years beginning on or after January 1, 2008, an individual retirement plan described in Code Section 408A(b) subject to any limitations in Code Section 408A(c) 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.

 

A portion of a distribution shall not fail to be an Eligible Rollover Distribution merely because the portion consists of the portion of a designated Roth account that is not includible in a Participant’s gross income.  However, for taxable years beginning on or after January 1, 2006, such portion may be transferred only to a Roth IRA described in Code Section 408A or to a designated Roth account under another plan 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.

 

If the distribution includes any portion of a designated Roth account, in determining if (v) above applies: (i) any portion of the distribution from the designated Roth account shall not be treated as an Eligible Rollover Distribution if it is reasonably expected to total less than $200 during a year and (ii) the balance of the distribution, if any, shall not be treated as an Eligible Rollover Distribution if it is reasonably expected to total less than $200 during a year. In addition, for taxable years beginning on or after January 1, 2006, a designated Roth account and all other accounts under the Plan shall be treated as accounts held under two separate plans and shall not be combined in determining a mandatory distribution of an Eligible Rollover Distribution greater than $1,000 in the DIRECT ROLLOVERS SECTION of Article X.

 

Employee means an individual who is employed by the Employer or any other employer required to be aggregated with the Employer under Code Sections 414(b), (c), (m), or (o). A Controlled Group member is required to be aggregated with the Employer.

 

The term Employee shall include any Self-employed Individual treated as an employee of any employer described in the preceding paragraph as provided in Code Section 401(c)(1). The term Employee shall

 

9

 

also include any Leased Employee deemed to be an employee of any employer described in the preceding paragraph as provided in Code Section 414(n) or (o).

 

Employer means, except for purposes of the CONTRIBUTION LIMITATION SECTION of Article III, the Primary Employer. This will also include any successor corporation or firm of the Employer which shall, by written agreement, assume the obligations of this Plan or any Predecessor Employer that maintained this Plan.

 

Employer Contributions means

 

Elective Deferral Contributions

Matching Contributions

Qualified Nonelective Contributions

Discretionary Contributions

 

as set out in Article III and contributions made by the Employer to fund this Plan in accordance with the provisions of the MODIFICATION OF CONTRIBUTIONS SECTION of Article XI, unless the context clearly indicates only specific contributions are meant.

 

Employment Commencement Date means the date an Employee first performs an Hour of Service.

 

Entry Date means the date an Employee first enters the Plan as an Active Participant for purposes of specified Contributions in the ACTIVE PARTICIPANT SECTION of Article II.

 

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

 

Forfeiture means the part, if any, of a Participant’s Account that is forfeited. See the FORFEITURES SECTION of Article III.

 

Forfeiture Date means, as to a Participant, the date the Participant incurs five consecutive Vesting Breaks in Service.

 

Highly Compensated Employee means any Employee who:

 

(a)           was a 5-percent owner at any time during the year or the preceding year, or

 

(b)           for the preceding year had compensation from the Employer in excess of $80,000 and, if the Employer so elects, was in the top-paid group for the preceding year. The $80,000 amount is adjusted at the same time and in the same manner as under Code Section 415(d), except that the base period is the calendar quarter ending September 30, 1996.

 

For this purpose the applicable year of the plan for which a determination is being made is called a determination year and the preceding 12-month period is called a look-back year. If the Employer makes a calendar year data election, the look-back year shall be the calendar year beginning with or within the look-back year.  The Plan may not use such election to determine whether Employees are Highly Compensated Employees on account of being a 5-percent owner.

 

10

 

In determining who is a Highly Compensated Employee, the Employer does not make a top-paid group election.  In determining who is a Highly Compensated Employee, the Employer does not make a calendar year data election.

 

Calendar year data elections and top-paid group elections, once made, apply for all subsequent years unless changed by the Employer. If the Employer makes one election, the Employer is not required to make the other. If both elections are made, the look-back year in determining the top-paid group must be the calendar year beginning with or within the look-back year.  These elections must apply consistently to the determination years of all plans maintained by the Employer which reference the highly compensated employee definition in Code Section 414(q), except as provided in Internal Revenue Service Notice 97-45 (or superseding guidance).

 

The determination of who is a highly compensated former Employee is based on the rules applicable to determining Highly Compensated Employee status as in effect for that determination year, in accordance with section 1.414(q)-1T, A-4 of the temporary Income Tax Regulations and Internal Revenue Service Notice 97-45.

 

The determination of who is a Highly Compensated Employee, including the determinations of the number and identity of Employees in the top-paid group, the compensation that is considered, and the identity of the 5-percent owners, shall be made in accordance with Code Section 414(q) and the regulations thereunder.

 

Hour of Service means the following:

 

(a)           Each hour for which an Employee is paid, or entitled to payment, for performing duties for the Employer during the applicable computation period.

 

(b)           Each hour for which an Employee is paid, or entitled to payment, by the Employer on account of a period of time in 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. Notwithstanding the preceding provisions of this subparagraph (b), no credit will be given to the Employee:

 

(1)           for more than 501 Hours of Service under this subparagraph (b) on account of any single continuous period in which the Employee performs no duties (whether or not such period occurs in a single computation period); or

 

(2)           for an Hour of Service for which the Employee is directly or indirectly paid, or entitled to payment, on account of a period in which no duties are performed if such payment is made or due under a plan maintained solely for the purpose of complying with applicable worker’s or workmen’s compensation, or unemployment compensation, or disability insurance laws; or

 

(3)           for an Hour of Service for a payment which solely reimburses the Employee for medical or medically related expenses incurred by him.

 

For purposes of this subparagraph (b), a payment shall be deemed to be made by, or due from the Employer, regardless of whether such payment is made by, or due from the Employer, directly or

 

11

 

indirectly through, among others, a trust fund or insurer, to which the Employer contributes or pays premiums and regardless of whether contributions made or due to the trust fund, insurer or other entity are for the benefit of particular employees or are on behalf of a group of employees in the aggregate.

 

(c)           Each hour for which back pay, irrespective of mitigation of damages, is either awarded or agreed to by the Employer. The same Hours of Service shall not be credited both under subparagraph (a) or subparagraph (b) above (as the case may be) and under this subparagraph (c). Crediting of Hours of Service for back pay awarded or agreed to with respect to periods described in subparagraph (b) above will be subject to the limitations set forth in that subparagraph.

 

The crediting of Hours of Service above shall be applied under the rules of paragraphs (b) and (c) of the Department of Labor Regulation 2530.200b-2 (including any interpretations or opinions implementing such rules); which rules, by this reference, are specifically incorporated in full within this Plan.  The reference to paragraph (b) applies to the special rule for determining Hours of Service for reasons other than the performance of duties such as payments calculated (or not calculated) on the basis of units of time and the rule against double credit. The reference to paragraph (c) applies to the crediting of Hours of Service to computation periods.

 

Hours of Service shall be credited for employment with any other employer required to be aggregated with the Employer under Code Sections 414(b), (c), (m), or (o) and the regulations thereunder for purposes of eligibility and vesting.  Hours of Service shall also be credited for any individual who is considered an employee for purposes of this Plan pursuant to Code Section 414(n) or (o) and the regulations thereunder.

 

Solely for purposes of determining whether a one-year break in service has occurred for eligibility or vesting purposes, during a Parental Absence an Employee shall be credited with the Hours of Service which would otherwise have been credited to the Employee but for such absence, or in any case in which such hours cannot be determined, eight Hours of Service per day of such absence. The Hours of Service credited under this paragraph shall be credited in the computation period in which the absence begins if the crediting is necessary to prevent a break in service in that period; or in all other cases, in the following computation period.

 

Inactive Participant means a former Active Participant who has an Account.  See the INACTIVE PARTICIPANT SECTION of Article II.

 

Insurer means Principal Life Insurance Company or the insurance company or companies named by (i) the Primary Employer or (ii) the Trustee in its discretion or as directed under the Trust Agreement.

 

Investment Fund means the total of Plan assets, excluding the guaranteed benefit policy portion of any Annuity Contract. All or a portion of these assets may be held under, or invested pursuant to, the terms of a Trust Agreement.

 

The Investment Fund shall be valued at current fair market value as of the Valuation Date.  The valuation shall take into consideration investment earnings credited, expenses charged, payments made, and changes in the values of the assets held in the Investment Fund.

 

12

 

The Investment Fund shall be allocated at all times to Participants, except as otherwise expressly provided in the Plan. The Account of a Participant shall be credited with its share of the gains and losses of the Investment Fund. That part of a Participant’s Account invested in a funding arrangement that establishes one or more accounts or investment vehicles for such Participant thereunder shall be credited with the gain or loss from such accounts or investment vehicles. The part of a Participant’s Account that is invested in other funding arrangements shall be credited with a proportionate share of the gain or loss of such investments. The share shall be determined by multiplying the gain or loss of the investment by the ratio of the part of the Participant’s Account invested in such funding arrangement to the total of the Investment Fund invested in such funding arrangement.

 

Investment Manager means any fiduciary (other than a trustee or Named Fiduciary)

 

(a)           who has the power to manage, acquire, or dispose of any assets of the Plan;

 

(b)           who (i) is registered as an investment adviser under the Investment Advisers Act of 1940; (ii) is 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) is a bank, as defined in that Act; or (iv) is an insurance company qualified to perform services described in subparagraph (a) above under the laws of more than one state; and

 

(c)           who has acknowledged in writing being a fiduciary with respect to the Plan.

 

Late Retirement Date means the first day of any month that is after a Participant’s Normal Retirement Date and on which retirement benefits begin. If a Participant continues to work for the Employer after his Normal Retirement Date, his Late Retirement Date shall be the earliest first day of the month on or after the date he has a Severance from Employment.  An earlier Retirement Date may apply if the Participant so elects. A later Retirement Date may apply if the Participant so elects. See the WHEN BENEFITS START SECTION of Article V.

 

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

 

A Leased Employee shall not be considered an employee of the recipient if:

 

(a)           such employee is covered by a money purchase pension plan providing (i) a nonintegrated  employer contribution rate of at least 10 percent of compensation, as defined in Code Section 415(c)(3), (ii) immediate participation, and (iii) full and immediate vesting, and

 

13

 

(b)           Leased Employees do not constitute more than 20 percent of the recipient’s nonhighly compensated work force.

 

Loan Administrator means the person(s) or position(s) authorized to administer the Participant loan program.

 

The Loan Administrator is the 401(k) Administrator.

 

Matching Contributions means contributions made by the Employer to fund this Plan that are contingent on a Participant’s Elective Deferral Contributions. See the EMPLOYER CONTRIBUTIONS SECTION of Article III.

 

Named Fiduciary means the person or persons who have authority to control and manage the operation and administration of the Plan.

 

The Named Fiduciary is the Employer.

 

Nonhighly Compensated Employee means an Employee of the Employer who is not a Highly Compensated Employee.

 

Nonvested Account means the excess, if any, of a Participant’s Account over his Vested Account.

 

Normal Form means a single life annuity with installment refund.

 

Normal Retirement Age means the age at which the Participant’s normal retirement benefit becomes nonforfeitable if he is an Employee. A Participant’s Normal Retirement Age is 65.

 

Normal Retirement Date means the earliest first day of the month on or after the date the Participant reaches his Normal Retirement Age. Unless otherwise provided in this Plan, a Participant’s retirement benefits shall begin on his Normal Retirement Date if he has had a Severance from Employment on such date. Even if the Participant is an Employee on his Normal Retirement Date, he may choose to have his retirement benefit begin on such date.

 

Parental Absence means an Employee’s absence from work:

 

(a)           by reason of pregnancy of the Employee,

 

(b)           by reason of birth of a child of the Employee,

 

(c)           by reason of the placement of a child with the Employee in connection with adoption of such child by such Employee, or

 

(d)           for purposes of caring for such child for a period beginning immediately following such birth or placement.

 

Participant means either an Active Participant or an Inactive Participant.

 

14

 

Period of Military Duty means, for an Employee

 

(a)           who served as a member of the armed forces of the United States, and

 

(b)           who was reemployed by the Employer at a time when the Employee had a right to reemployment in accordance with seniority rights as protected under Chapter 43 of Title 38 of the U.S. Code,

 

the period of time from the date the Employee was first absent from active work for the Employer because of such military duty to the date the Employee was reemployed.

 

Plan means the 401(k) profit sharing plan of the Employer set forth in this document, including any later amendments to it.

 

Plan Administrator means the person or persons who administer the Plan.

 

The Plan Administrator is the Employer.

 

Plan Fund means the total of the Investment Fund and the guaranteed benefit policy portion of any Annuity Contract.  The Investment Fund shall be valued as stated in its definition. The guaranteed benefit policy portion of any Annuity Contract shall be determined in accordance with the terms of the Annuity Contract and, to the extent that such Annuity Contract allocates contract values to Participants, allocated to Participants in accordance with its terms. The total value of all amounts held under the Plan Fund shall equal the value of the aggregate Participants’ Accounts under the Plan.

 

Plan Year means a period beginning on a Yearly Date and ending on the day before the next Yearly Date.

 

Predecessor Employer means, except for purposes of the CONTRIBUTION LIMITATION SECTION of Article III, a firm of which the Employer was once a part (e.g., due to a spinoff or change of corporate status) or a firm absorbed by the Employer because of a merger or acquisition (stock or asset, including a division or an operation of such company) that maintained this Plan.

 

Pre-tax Elective Deferral Contributions means a Participant’s Elective Deferral Contributions that are not includible in the Participant’s gross income at the time deferred.

 

Primary Employer means EnergySolutions, LLC.

 

Prior Employer means an Employee’s last employer immediately prior to the Employer which is not a Predecessor Employer or a Controlled Group member and which is named below:

 

C H2M WG Idaho (CWI)

Magnox (effective October 7, 2009) 

RSMC (effective October 7, 2009)

 

Qualified Joint and Survivor Annuity means, for a Participant who has a spouse, an immediate survivorship life annuity with installment refund, where the survivorship percentage is 50% and the Contingent Annuitant is the Participant’s spouse. A former spouse will be treated as the spouse to the extent provided under a qualified domestic relations order as described in Code Section 414(p).

 

15

 

The amount of benefit payable under the Qualified Joint and Survivor Annuity shall be the amount of benefit that may be provided by the Participant’s Vested Account.

 

Qualified Nonelective Contributions means contributions made by the Employer to fund this Plan (other than Elective Deferral Contributions) that are 100% vested when made to the Plan and that are distributable only in accordance with the distribution provisions (other than for hardships) applicable to Elective Deferral Contributions. See the EMPLOYER CONTRIBUTIONS SECTION of Article III and the WHEN BENEFITS START SECTION of Article V.

 

Qualified Preretirement Survivor Annuity means a single life annuity with installment refund payable to the surviving spouse of a Participant who dies before his Annuity Starting Date. A former spouse will be treated as the surviving spouse to the extent provided under a qualified domestic relations order as described in Code Section 414(p).

 

Qualifying Employer Securities means any security which is issued by the Employer or any Controlled Group member and which meets the requirements of Code Section 409(l) and ERISA Section 407(d)(5). This shall also include any securities that satisfied the requirements of the definition when these securities were assigned to the Plan.

 

Qualifying Employer Securities Fund means that part of the assets of the Trust Fund that are designated to be held primarily or exclusively in Qualifying Employer Securities for the purpose of providing benefits for Participants.

 

Reemployment Commencement Date means the date an Employee first performs an Hour of Service following an Eligibility Break in Service.

 

Reentry Date means the date a former Active Participant reenters the Plan.  See the ACTIVE PARTICIPANT SECTION of Article II.

 

Retirement Date means the date a retirement benefit will begin and is a Participant’s Normal or Late Retirement Date, as the case may be.

 

Rollover Contributions means the Rollover Contributions which are made by an Eligible Employee or an Inactive Participant according to the provisions of the ROLLOVER CONTRIBUTIONS SECTION of Article III.

 

Roth Elective Deferral Contributions means a Participant’s Elective Deferral Contributions that are not excludible from the Participant’s gross income at the time deferred and have been irrevocably designated as Roth Elective Deferral Contributions by the Participant in his elective deferral agreement. Whether an Elective Deferral Contribution is not excludible from a Participant’s gross income will be determined in accordance with section 1.401(k)-1(f)(2) of the regulations. In the case of a Self-employed Individual, an Elective Deferral Contribution is not excludible from gross income only if the individual does not claim a deduction for such amount.

 

Self-employed Individual means, with respect to any taxable year, an individual who has Earned Income for the taxable year (or who would have Earned Income but for the fact the trade or business for which this Plan is established did not have net profits for such taxable year).

 

16

 

Severance from Employment means, except for purposes of the CONTRIBUTION LIMITATION SECTION of Article III, an Employee has ceased to be an Employee. The Plan Administrator shall determine if a Severance from Employment has occurred in accordance with section 1.401(k)-1(d)(2) of the regulations.

 

Totally and Permanently Disabled means that a Participant is disabled, as a result of sickness or injury, to the extent that he is prevented from engaging in any substantial gainful activity, and is eligible for and receives a disability benefit under Title II of the Federal Social Security Act.

 

Trust Agreement means an agreement or agreements of trust between the Primary Employer and Trustee established for the purpose of holding and distributing the Trust Fund under the provisions of the Plan. The Trust Agreement may provide for the investment of all or any portion of the Trust Fund in the Annuity Contract or any other investment arrangement.

 

Trust Fund means the total funds held under an applicable Trust Agreement. The term Trust Fund when used within a Trust Agreement shall mean only the funds held under that Trust Agreement.

 

Trustee means the party or parties named in the applicable Trust Agreement.

 

Valuation Date means the date on which the value of the assets of the Investment Fund is determined. The value of each Account that is maintained under this Plan shall be determined on the Valuation Date. In each Plan Year, the Valuation Date shall be the last day of the Plan Year. At the discretion of the Plan Administrator, Trustee, or Insurer (whichever applies) and in a nondiscriminatory manner, assets of the Investment Fund may be valued more frequently. These dates shall also be Valuation Dates.

 

Vested Account means the vested part of a Participant’s Account. The Participant’s Vested Account is determined as follows.

 

If the Participant’s Vesting Percentage is 100%, his Vested Account equals his Account.

 

If the Participant’s Vesting Percentage is not 100%, his Vested Account equals the sum of (a) and (b) below:

 

(a)                                  The part of the Participant’s Account resulting from Employer Contributions made before a prior Forfeiture Date and all other Contributions that were 100% vested when made.

 

(b)                                 The balance of the Participant’s Account in excess of the amount in (a) above multiplied by his Vesting Percentage.

 

If the Participant has withdrawn any part of his Account resulting from Employer Contributions, other than the vested Employer Contributions included in (a) above, the amount determined under this subparagraph (b) shall be equal to P(AB + D) - D as defined below:

 

P                                         The Participant’s Vesting Percentage.

 

AB                              The balance of the Participant’s Account in excess of the amount in (a) above.

 

17

 

D                                       The amount of the withdrawal resulting from Employer Contributions, other than the vested Employer Contributions included in (a) above.

 

Vesting Break in Service means a Vesting Computation Period in which an Employee is credited with 500 or fewer Hours of Service. An Employee incurs a Vesting Break in Service on the last day of a Vesting Computation Period in which he has a Vesting Break in Service.

 

Vesting Computation Period means a consecutive 12-month period ending on the last day of each Plan Year, including corresponding consecutive 12-month periods before July 1, 1990.

 

Vesting Percentage means the percentage used to determine the nonforfeitable portion of a Participant’s Account attributable to Employer Contributions that were not 100% vested when made.

 

A Participant’s Vesting Percentage is shown in the following schedule opposite the number of whole years of his Vesting Service.

 

	
VESTING SERVICE
    	
 
    	
VESTING
    	
 
    
	
(whole years)
    	
 
    	
PERCENTAGE
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Less than 1
    	
 
    	
0
    	
 
    
	
1
    	
 
    	
25
    	
 
    
	
2
    	
 
    	
50
    	
 
    
	
3
    	
 
    	
75
    	
 
    
	
4 or more
    	
 
    	
100
    	
 
    

 

The Vesting Percentage for a Participant who is an Employee on or after the date he reaches Normal Retirement Age shall be 100%. The Vesting Percentage for a Participant who is an Employee on the date he dies shall be 100%. The Vesting Percentage for a Participant who is an Employee on the date he becomes disabled shall be 100% if such disability is subsequently determined to meet the definition of Totally and Permanently Disabled.

 

If the schedule used to determine a Participant’s Vesting Percentage is changed, the new schedule shall not apply to a Participant unless he is credited with an Hour of Service on or after the date of the change and the Participant’s nonforfeitable percentage on the day before the date of the change is not reduced under this Plan.  The amendment provisions of the AMENDMENTS SECTION of Article X regarding changes in the computation of the Vesting Percentage shall apply.

 

Vesting Service means one year of service for each Vesting Computation Period in which an Employee is credited with at least 1,000 Hours of Service.

 

However, Vesting Service is modified as follows:

 

Service with a Predecessor Employer that did not maintain this Plan included:

 

An Employee’s service with a Predecessor Employer that did not maintain this Plan shall be included as service with the Employer. This service excludes service performed while a proprietor or partner.

 

18

 

Prior Employer service included:

 

An Employee’s service with a Prior Employer shall be included as service with the Employer. An Employee’s service with such Prior Employer shall be counted only if service continued with the Employer without interruption.

 

Period of Military Duty included:

 

A Period of Military Duty shall be included as service with the Employer to the extent it has not already been credited. For purposes of crediting Hours of Service during the Period of Military Duty, an Hour of Service shall be credited (without regard to the 501 Hour of Service limitation) for each hour an Employee would normally have been scheduled to work for the Employer during such period.

 

Controlled Group service included:

 

An Employee’s service with a member firm of a Controlled Group while both that firm and the Employer were members of the Controlled Group shall be included as service with the Employer.

 

Yearly Date means July 1, 1990, and each following January 1.

 

Years of Service means an Employee’s Vesting Service disregarding any modifications that exclude service.

 

19

 

ARTICLE II

 

PARTICIPATION

 

SECTION 2.01—ACTIVE PARTICIPANT.

 

(a)                                  For purposes of Elective Deferral Contributions, an Employee shall first become an Active Participant (begin active participation in the Plan) on the earliest date on which he is an Eligible Employee. This date is his Entry Date for purposes of such Contributions.

 

For purposes of Contributions other than Elective Deferral Contributions, an Employee shall first become an Active Participant (begin active participation in the Plan) on the earliest date on which he is an Eligible Employee and has met the eligibility requirement set forth below. This date is his Entry Date for purposes of such Contributions.

 

(1)                                  He has completed one year of Eligibility Service before his Entry Date.

 

A Participant’s earliest Entry Date shall be used to determine if he is an Active Participant for purposes of any minimum contribution or allocation under the MODIFICATION OF CONTRIBUTIONS SECTION of Article XI.

 

Each Employee who was an Active Participant for purposes of specified Contributions on September 30, 2009, shall continue to be an Active Participant for purposes of the specified Contributions if he is still an Eligible Employee on October 1, 2009, and his Entry Date shall not change.

 

If service with a Predecessor Employer or Prior Employer is counted for purposes of Eligibility Service, an Employee shall be credited with such service on the date he becomes an Employee and shall become an Active Participant for purposes of specified Contributions which have an Eligibility Service requirement on the earliest Entry Date for such Contributions on which he is an Eligible Employee and has met all of the eligibility requirements for such Contributions above. This date is his Entry Date for purposes of such Contributions.

 

In the event an Employee who is not an Eligible Employee becomes an Eligible Employee, such Eligible Employee shall become an Active Participant for purposes of specified Contributions immediately if such Eligible Employee has satisfied the eligibility requirements for purposes of such Contributions above and would have otherwise previously become an Active Participant for purpose of such Contributions had he met the definition of Eligible Employee. This date is his Entry Date for purposes of such Contributions.

 

(b)                                 An Inactive Participant shall again become an Active Participant (resume active participation in the Plan) for purposes of the Contributions for which he previously had an Entry Date on the date he again performs an Hour of Service as an Eligible Employee. This date is his Reentry Date for such Contributions.

 

Upon again becoming an Active Participant, he shall cease to be an Inactive Participant.

 

20

 

(c)                                  A former Participant shall again become an Active Participant (resume active participation in the Plan) for purposes of the Contributions for which he previously had an Entry Date on the date he again performs an Hour of Service as an Eligible Employee. This date is his Reentry Date for such Contributions.

 

There shall be no duplication of benefits for a Participant because of more than one period as an Active Participant.

 

SECTION 2.02—INACTIVE PARTICIPANT.

 

An Active Participant shall become an Inactive Participant (stop accruing benefits) on the earlier of the following:

 

(a)                                  the date the Participant ceases to be an Eligible Employee, or

 

(b)                                 the effective date of complete termination of the Plan under Article VIII.

 

An Employee or former Employee who was an Inactive Participant on September 30, 2009, shall continue to be an Inactive Participant on October 1, 2009. Eligibility for any benefits payable to the Participant or on his behalf and the amount of the benefits shall be determined according to the provisions of the prior document, unless otherwise stated in this document or any subsequent documents.

 

SECTION 2.03—CESSATION OF PARTICIPATION.

 

A Participant shall cease to be a Participant on the date he is no longer an Eligible Employee and his Account is zero.

 

21

 

ARTICLE III

 

CONTRIBUTIONS

 

SECTION 3.01—EMPLOYER CONTRIBUTIONS.

 

Employer Contributions shall be made without regard to current or accumulated net income, earnings, or profits of the Employer. Notwithstanding the foregoing, the Plan shall continue to be designed to qualify as a profit sharing plan for purposes of Code Sections 401(a), 402, 412, and 417. Such Contributions shall be equal to the Employer Contributions as described below:

 

(a)                                  The amount of each Elective Deferral Contribution for a Participant shall be equal to a portion of Compensation as specified in the elective deferral agreement. An Employee who is eligible to participate in the Plan for purposes of Elective Deferral Contributions may file an elective deferral agreement with the Employer.  The Participant shall modify or terminate the elective deferral agreement by filing a new elective deferral agreement. The elective deferral agreement may not be made retroactively and shall remain in effect until modified or terminated.

 

The elective deferral agreement to start or modify Elective Deferral Contributions shall be effective as soon as administratively feasible on or after the Participant’s Entry Date (Reentry Date, if applicable) or any following date. The elective deferral agreement must be entered into on or before the date it is effective.

 

The elective deferral agreement to stop Elective Deferral Contributions may be entered into on any date.  Such elective deferral agreement shall be effective as soon as administratively feasible following the date on which the elective deferral agreement is entered into.

 

Elective Deferral Contributions cannot be more than 75% of Compensation. A Participant who is eligible to make Catch-up Contributions shall not be limited to the maximum deferral percentage unless his Elective Deferral Contributions, including Catch-up Contributions, exceed this limit plus the dollar amount of Catch-up Contributions permitted.

 

A Participant who is age 50 or older by the end of the taxable year shall be eligible to make Catch-up Contributions.

 

A Participant may elect to designate all or any portion of his future Elective Deferral Contributions as Roth Elective Deferral Contributions.

 

The Plan provides for an automatic election to have Elective Deferral Contributions made. The automatic Elective Deferral Contribution shall be Pre-tax Elective Deferral Contributions and shall be 3% of Compensation.  The automatic Elective Deferral Contribution shall be automatically increased each January 1 by 1% up to a maximum automatic Elective Deferral Contribution of 6%.  The automatic increase shall apply to each Participant not deferring at least 6% of Compensation. The Participant may affirmatively elect a different percentage or elect not to make Elective Deferral Contributions, and may elect to designate all or any portion of his Elective Deferral Contributions as Roth Elective Deferral Contributions.

 

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Such automatic election shall apply when a Participant first becomes eligible to make Elective Deferral Contributions (or again becomes eligible after a period during which he was not an Active Participant). The Participant shall be provided a notice that explains the automatic election and his right to elect a different rate of Elective Deferral Contributions or to elect not to make Elective Deferral Contributions, and his right to designate a portion of his Elective Deferral Contributions as Roth Elective Deferral Contributions. The notice shall include the procedure for exercising those rights and the timing for implementing any such elections. The Participant shall be given a reasonable period thereafter to elect a different rate of Elective Deferral Contributions or to elect not to make Elective Deferral Contributions, and to designate a portion of his Elective Deferral Contributions as Roth Elective Deferral Contributions.

 

Each Active Participant affected by the automatic election and automatic increase shall be provided an annual notice that explains the automatic election and his right to elect a different rate of Elective Deferral Contributions or to elect not to make Elective Deferral Contributions, and his right to designate all or any portion of his Elective Deferral Contributions as Roth Elective Deferral Contributions. The notice shall include the procedure for exercising those rights and the timing for implementing any such elections.

 

No Participant shall be permitted to have Elective Deferral Contributions, as defined in the EXCESS AMOUNTS SECTION of this article, made under this Plan, or any other plan, contract, or arrangement maintained by the Employer, during any calendar year, in excess of the dollar limitation contained in Code Section 402(g) in effect for the Participant’s taxable year beginning in such calendar year. The dollar limitation in the preceding sentence shall be increased by the dollar limit on Catch-up Contributions under Code Section 414(v)(2)(B)(i) for the taxable year for any Participant who will be age 50 or older by the end of the taxable year.

 

The dollar limitation contained in Code Section 402(g) is $10,500 for taxable years beginning in 2000 and 2001, increasing to $11,000 for taxable years beginning in 2002, and increasing by $1,000 for each year thereafter up to $15,000 for taxable years beginning in 2006 and later years. After 2006, the $15,000 limit will be adjusted by the Secretary of the Treasury for cost-of-living increases under Code Section 402(g)(4). Any such adjustments will be in multiples of $500.

 

Catch-up Contributions for a Participant for a taxable year may not exceed the dollar limit on Catch-up Contributions under Code Section 414(v)(2)(B)(i) for the taxable year. The dollar limit on Catch-up Contributions under Code Section 414(v)(2)(B)(i) is $1,000 for taxable years beginning in 2002, increasing by $1,000 for each year thereafter up to $5,000 for taxable years beginning in 2006 and later years. After 2006, the $5,000 limit will be adjusted by the Secretary of the Treasury for cost-of-living increases under Code Section 414(v)(2)(C). Any such adjustments will be in multiples of $500.

 

An elective deferral agreement (or change thereto) must be made in such manner and in accordance with such rules as the Employer may prescribe in a nondiscriminatory manner (including by means of voice response or other electronic system under circumstances the Employer permits) and may not be made retroactively.

 

Elective Deferral Contributions are 100% vested and nonforfeitable.

 

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(b)                                 The Employer may make discretionary Matching Contributions. The percentage of Elective Deferral Contributions matched, if any, shall be a percentage as determined by the Employer. Elective Deferral Contributions that are over a percentage of Compensation won’t be matched. The percentage shall be determined by the Employer.

 

Matching Contributions are calculated based on Elective Deferral Contributions and Compensation for the payroll period. Matching Contributions are made for all persons who were Active Participants at any time during that payroll period.

 

Any percentage determined by the Employer shall apply to all eligible persons for the entire Plan Year.

 

Matching Contributions are subject to the Vesting Percentage.

 

(c)                                  Qualified Nonelective Contributions may be made for each Plan Year in an amount determined by the Employer to be used to reduce Excess Aggregate Contributions and Excess Contributions, as defined in the EXCESS AMOUNTS SECTION of this article. If the Plan is treated as separate plans because it is mandatorily disaggregated under the regulations of Code Section 401(k), a separate Qualified Nonelective Contribution may be determined for each separate plan.

 

Qualified Nonelective Contributions are 100% vested and are distributable only in accordance with the distribution provisions (other than for hardships) applicable to Elective Deferral Contributions.

 

(d)                                 Discretionary Contributions may be made for each Plan Year in an amount determined by the Employer.

 

Discretionary Contributions are subject to the Vesting Percentage.

 

Employer Contributions are allocated according to the provisions of the ALLOCATION SECTION of this article.

 

A portion of the Plan assets resulting from Employer Contributions (but not more than the original amount of those Contributions) may be returned if the Employer Contributions are made because of a mistake of fact or are more than the amount deductible under Code Section 404 (excluding any amount which is not deductible because the Plan is disqualified). The amount involved must be returned to the Employer within one year after the date the Employer Contributions are made by mistake of fact or the date the deduction is disallowed, whichever applies. Except as provided under this paragraph and in Article VIII, the assets of the Plan shall never be used for the benefit of the Employer and are held for the exclusive purpose of providing benefits to Participants and their Beneficiaries and for defraying reasonable expenses of administering the Plan.

 

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SECTION 3.01A—ROLLOVER CONTRIBUTIONS.

 

A Rollover Contribution may be made by an Eligible Employee or Inactive Participant if the following conditions are met:

 

(a)                                  The Contribution is a Participant Rollover Contribution or a direct rollover of a distribution made after December 31, 2001 from the types of plans specified below. A Participant Rollover Contribution or a direct rollover of a distribution from a designated Roth account applies only to distributions made in taxable years beginning on or after January 1, 2006.

 

Direct Rollovers. The Plan will accept a direct rollover of an Eligible Rollover Distribution from (i) a qualified plan described in Code Section 401(a) or 403(a), including after-tax employee contributions and any portion of a designated Roth account; (ii) an annuity contract described in Code Section 403(b), including after-tax employee contributions and any portion of a designated Roth account; and (iii) an eligible plan under Code Section 457(b) which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state.

 

Participant Rollover Contributions from Other Plans. The Plan will accept a Participant contribution of an Eligible Rollover Distribution from (i) a qualified plan described in Code Section 401(a) or 403(a), including distributions of a designated Roth account only to the extent such amount would otherwise be includible in a Participant’s gross income; (ii) an annuity contract described in Code Section 403(b), including distributions of a designated Roth account only to the extent such amount would otherwise be includible in a Participant’s gross income; and (iii) an eligible plan under Code Section 457(b) which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state.

 

Participant Rollover Contributions from IRAs. The Plan will accept a Participant Rollover Contribution of the portion of a distribution from an individual retirement account or individual retirement annuity described in Code Section 408(a) or (b) that is eligible to be rolled over and would otherwise be includible in the Participant’s gross income.

 

(b)                                 The Contribution is of amounts that the Code permits to be transferred to a plan that meets the requirements of Code Section 401(a).

 

(c)                                  The Contribution is made in the form of a direct rollover under Code Section 401(a)(31) or is a rollover made under Code Section 402(c) or 408(d)(3)(A) within 60 days after the Eligible Employee or Inactive Participant receives the distribution.

 

(d)                                 The Eligible Employee or Inactive Participant furnishes evidence satisfactory to the Plan Administrator that the proposed rollover meets conditions (a), (b), and (c) above.

 

(e)                                  In the case of an Inactive Participant, the Contribution must be of an amount distributed from another plan of the Employer or a plan of a Controlled Group member.

 

A Rollover Contribution shall be allowed in cash only and must be made according to procedures set up by the Plan Administrator.

 

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If the Eligible Employee is not an Active Participant when the Rollover Contribution is made, he shall be deemed to be an Active Participant only for the purpose of investment and distribution of the Rollover Contribution. Employer Contributions shall not be made for or allocated to the Eligible Employee until the time he meets all of the requirements to become an Active Participant.

 

Rollover Contributions made by an Eligible Employee or an Inactive Participant shall be credited to his Account.  The part of the Participant’s Account resulting from Rollover Contributions is 100% vested and nonforfeitable at all times. Separate accounting records shall be maintained for those parts of his Rollover Contributions consisting of (i) voluntary contributions which were deducted from the Participant’s gross income for Federal income tax purposes; (ii) after-tax employee contributions, including the portion that would not have been includible in the Participant’s gross income if the contributions were not rolled over into this Plan; and (iii) any portion of a designated Roth account, including the portion that would not have been includible in the Participant’s gross income if the contributions were not rolled over into this Plan.

 

SECTION 3.02—FORFEITURES.

 

The Nonvested Account of a Participant shall be forfeited as of the earlier of the following:

 

(a)                                  the date the record keeper is notified that the Participant died (if prior to such date he has had a Severance from Employment), or

 

(b)                                 the Participant’s Forfeiture Date.

 

All or a portion of a Participant’s Nonvested Account shall be forfeited before such earlier date if, after he has a Severance from Employment, he receives, or is deemed to receive, a distribution of his entire Vested Account or a distribution of his Vested Account derived from Employer Contributions that were not 100% vested when made, under the RETIREMENT BENEFITS SECTION of Article V, the VESTED BENEFITS SECTION of Article V, or the SMALL AMOUNTS SECTION of Article X. The forfeiture shall occur as of the date the Participant receives, or is deemed to receive, the distribution. If a Participant receives, or is deemed to receive, his entire Vested Account, his entire Nonvested Account shall be forfeited.  If a Participant receives a distribution of his Vested Account from Employer Contributions that were not 100% vested when made, but less than his entire Vested Account, the amount to be forfeited shall be determined by multiplying his Nonvested Account from such Contributions by a fraction. The numerator of the fraction is the amount of the distribution derived from Employer Contributions that were not 100% vested when made and the denominator of the fraction is his entire Vested Account derived from such Contributions on the date of the distribution.

 

A Forfeiture shall also occur as provided in the EXCESS AMOUNTS SECTION of this article.

 

Forfeitures shall be determined at least once during each Plan Year. Forfeitures may first be used to pay administrative expenses.  Forfeitures of Matching Contributions that relate to excess amounts as provided in the EXCESS AMOUNTS SECTION of this article, that have not been used to pay administrative expenses, shall be applied to reduce the earliest Employer Contributions made after the Forfeitures are determined. Any other Forfeitures that have not been used to pay administrative expenses shall be applied to reduce the earliest Employer Contributions made after the Forfeitures are determined.  Upon their application to reduce Employer Contributions, Forfeitures shall be deemed to be Employer Contributions.

 

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If a Participant again becomes an Eligible Employee after receiving a distribution which caused all or a portion of his Nonvested Account to be forfeited, he shall have the right to repay to the Plan the entire amount of the distribution he received (excluding any amount of such distribution resulting from Contributions that were 100% vested when made).  The repayment must be made in a single sum (repayment in installments is not permitted) before the earlier of the date five years after the date he again becomes an Eligible Employee or the end of the first period of five consecutive Vesting Breaks in Service which begin after the date of the distribution.

 

If the Participant makes the repayment above, the Plan Administrator shall restore to his Account an amount equal to his Nonvested Account that was forfeited on the date of distribution, unadjusted for any investment gains or losses.  If no amount is to be repaid because the Participant was deemed to have received a distribution, or only received a distribution of Contributions which were 100% vested when made, and he again performs an Hour of Service as an Eligible Employee within the repayment period, the Plan Administrator shall restore the Participant’s Account as if he had made a required repayment on the date he performed such Hour of Service.  Restoration of the Participant’s Account shall include restoration of all Code Section 411(d)(6) protected benefits with respect to the restored Account, according to applicable Treasury regulations. Provided, however, the Plan Administrator shall not restore the Nonvested Account if (i) a Forfeiture Date has occurred after the date of the distribution and on or before the date of repayment and (ii) that Forfeiture Date would result in a complete forfeiture of the amount the Plan Administrator would otherwise restore.

 

The Plan Administrator shall restore the Participant’s Account by the close of the Plan Year following the Plan Year in which repayment is made.  The permissible sources for restoration of the Participant’s Account are Forfeitures or special Employer Contributions.  Such special Employer Contributions shall be made without regard to profits.  The repaid and restored amounts are not included in the Participant’s Annual Additions, as defined in the CONTRIBUTION LIMITATION SECTION of this article.

 

SECTION 3.03—ALLOCATION.

 

A person meets the allocation requirements of this section if he was an Active Participant at any time during the Plan Year.

 

Elective Deferral Contributions shall be allocated to the Participants for whom such Contributions are made under the EMPLOYER CONTRIBUTIONS SECTION of this article. Such Contributions shall be allocated when made and credited to the Participant’s Account.

 

Matching Contributions shall be allocated to the persons for whom such Contributions are made under the EMPLOYER CONTRIBUTIONS SECTION of this article. Such Contributions shall be allocated when made and credited to the person’s Account.

 

The discretionary Qualified Nonelective Contributions to be used to reduce excess amounts, as described in the EMPLOYER CONTRIBUTIONS SECTION of this article, shall be allocated as of the last day of the Plan Year only to Nonhighly Compensated Employees who meet the allocation requirements of this section. Such Contributions (or separate Contributions) shall be allocated first to the eligible person under the Plan (or separate plan) with the lowest Annual Compensation for the Plan Year, then to the eligible person under the Plan (or separate plan) with the next lowest Annual Compensation, and so forth.  The amount of such Contributions shall be limited in each case to 5% of the eligible person’s Compensation used for purposes of the ADP Test. This amount shall be credited to the person’s Account.

 

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Discretionary Contributions shall be allocated as of the last day of the Plan Year, using Annual Compensation for the Plan Year. In years in which the Plan is a Top-heavy Plan, as defined in the DEFINITIONS SECTION of Article XI, and the minimum contribution under the MODIFICATION OF CONTRIBUTIONS SECTION of Article XI is not being provided by other contributions to this Plan or another plan of the Employer, the allocation shall be made to each person meeting the allocation requirements of this section and each person entitled to a minimum contribution under the MODIFICATION OF CONTRIBUTIONS SECTION of Article XI. In all other years, the allocation shall be made to each person meeting the allocation requirements of this section. The amount allocated shall be equal to the Discretionary Contributions multiplied by the ratio of such person’s Annual Compensation to the total Annual Compensation for all such persons. The allocation for any person who does not meet the allocation requirements of this section shall be limited to the amount necessary to fund the minimum contribution.

 

In years in which the Plan is a Top-heavy Plan, the minimum contribution under the MODIFICATION OF CONTRIBUTIONS SECTION of Article XI is not being provided by other contributions to this Plan or another plan of the Employer, and the allocation described above (or any subsequent allocation described below) would provide an allocation for any person less than the minimum contribution required for such person in the MODIFICATION OF CONTRIBUTIONS SECTION of Article XI, such minimum contribution shall first be allocated to all such persons. Then any amount remaining shall be allocated to the remaining persons sharing in the allocation based on Annual Compensation as described above, as if they were the only persons sharing in the allocation for the Plan Year.

 

This amount shall be credited to the person’s Account.

 

If Leased Employees are Eligible Employees, in determining the amount of Employer Contributions allocated to a person who is a Leased Employee, contributions provided by the leasing organization that are attributable to services such Leased Employee performs for the Employer shall be treated as provided by the Employer. Those contributions shall not be duplicated under this Plan.

 

SECTION 3.04—CONTRIBUTION LIMITATION.

 

Contributions to the Plan shall be limited in accordance with Code Section 415 and the regulations thereunder. The limitations of this section shall apply to Limitation Years beginning on or after July 1, 2007, except as otherwise provided herein.

 

(a)                                  Definitions. For the purpose of determining the contribution limitation set forth in this section, the following terms are defined.

 

Annual Additions means the sum of the following amounts credited to a Participant’s account for the Limitation Year:

 

(1)                                  employer contributions;

 

(2)                                  employee contributions; and

 

(3)                                  forfeitures.

 

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Annual Additions to a defined contribution plan, as defined in section 1.415(c)-1(a)(2)(i) of the regulations, shall also include the following:

 

(4)                                  mandatory employee contributions, as defined in Code Section 411(c)(2)(C) and section 1.411(c)-1(c)(4) of the regulations, to a defined benefit plan;

 

(5)                                  contributions allocated to any individual medical benefit account, as defined in Code Section 415(l)(2), which is part of a pension or annuity plan maintained by the Employer;

 

(6)                                  amounts attributable to post-retirement medical benefits, allocated to the separate account of a key employee, as defined in Code Section 419A(d)(3), under a welfare benefit fund, as defined in Code Section 419(e), maintained by the Employer; and

 

(7)                                  annual additions under an annuity contract described in Code Section 403(b).

 

Compensation means wages, within the meaning of Code Section 3401(a), and all other payments of compensation to an employee by the Employer (in the course of the Employer’s trade or business) for which the Employer is required to furnish the employee a written statement under Code Sections 6041(d), 6051(a)(3), and 6052. Compensation shall be determined without regard to any rules under Code Section 3401(a) that limit the remuneration included in wages based on the nature or location of the employment or the services performed (such as the exception for agricultural labor in Code Section 3401(a)(2)). The type of compensation that is reported in the “Wages, Tips and Other Compensation” box on Form W-2 satisfies this definition.

 

For any Self-employed Individual, Compensation shall mean Earned Income.

 

Except as provided herein, Compensation for a Limitation Year is the Compensation actually paid or made available (or if earlier, includible in gross income) during such Limitation Year.

 

For Limitation Years beginning on or after July 1, 2007, Compensation for a Limitation Year shall also include Compensation paid by the later of 2 1/2 months after an employee’s Severance from Employment with the Employer maintaining the plan or the end of the Limitation Year that includes the date of the employee’s Severance from Employment with the Employer maintaining the plan, if the payment is regular Compensation for services during the employee’s regular working hours, or Compensation for services outside the employee’s regular working hours (such as overtime or shift differential), commissions, bonuses, or other similar payments, and, absent a Severance from Employment, the payments would have been paid to the employee while the employee continued in employment with the Employer.

 

Any payments not described above shall not be considered Compensation if paid after Severance from Employment, even if they are paid by the later of 2 1/2 months after the date of Severance from Employment or the end of the Limitation Year that includes the date of Severance from Employment, except, payments to an individual who does not currently perform services for the Employer by reason of qualified military service (as that term is used in Code Section 414(u)(1)) to the extent these payments do not exceed the amounts the individual would have received if the individual had continued to perform services for the Employer rather than entering qualified military service.

 

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Back pay, within the meaning of section 1.415(c)-2(g)(8) of the regulations, shall be treated as Compensation for the Limitation Year to which the back pay relates to the extent the back pay represents wages and compensation that would otherwise be included in this definition.

 

Compensation paid or made available during such Limitation Year shall include amounts that would otherwise be included in Compensation but for an election under Code Section 125(a), 132(f)(4), 402(e)(3), 402(h)(1)(B), 402(k), or 457(b).

 

Compensation shall not include amounts paid as Compensation to a nonresident alien, as defined in Code Section 7701(b)(1)(B), who is not a Participant in the Plan to the extent the Compensation is excludible from gross income and is not effectively connected with the conduct of a trade or business within the United States.

 

Defined Contribution Dollar Limitation means, effective for Limitation Years beginning after December 31, 2001, $40,000, automatically adjusted under Code Section 415(d), effective January 1 of each year, as published in the Internal Revenue Bulletin. The new limitation shall apply to Limitation Years ending with or within the calendar year of the date of the adjustment, but a Participant’s Annual Additions for a Limitation Year cannot exceed the currently applicable dollar limitation (as in effect before the January 1 adjustment) prior to January 1. However, after a January 1 adjustment is made, Annual Additions for the entire Limitation Year are permitted to reflect the dollar limitation as adjusted on January 1.

 

Employer means the employer that adopts this Plan, and all members of a controlled group of corporations (as defined in Code Section 414(b) as modified by Code Section 415(h)), all commonly controlled trades or businesses (as defined in Code Section 414(c), as modified, except in the case of a brother-sister group of trades or businesses under common control, by Code Section 415(h)), or affiliated service groups (as defined in Code Section 414(m)) of which the adopting employer is a part, and any other entity required to be aggregated with the employer pursuant to Code Section 414(o).

 

Limitation Year means the consecutive 12-month period ending on the last day of each Plan Year, including corresponding consecutive 12-month periods before July 1, 1990. If the Limitation Year is other than the calendar year, execution of this Plan (or any amendment to this Plan changing the Limitation Year) constitutes the Employer’s adoption of a written resolution electing the Limitation Year. If the Limitation Year is amended to a different consecutive 12-month period, the new Limitation Year must begin on a date within the Limitation Year in which the amendment is made.

 

Maximum Annual Addition means, for Limitation Years beginning on or after January 1, 2002, except for catch-up contributions described in Code Section 414(v), the Annual Addition that may be contributed or allocated to a Participant’s Account under the Plan for any Limitation Year. This amount shall not exceed the lesser of:

 

(1)                                  The Defined Contribution Dollar Limitation, or

 

(2)                                  100 percent of the Participant’s Compensation for the Limitation Year.

 

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A Participant’s Compensation for a Limitation Year shall not include Compensation in excess of the limitation under Code Section 401(a)(17) that is in effect for the calendar year in which the Limitation Year begins.

 

The compensation limitation referred to in (2) shall not apply to an individual medical benefit account (as defined in Code Section 415(l); or a post-retirement medical benefits account for a key employee (as defined in Code Section 419A(d)(1)).

 

If a short Limitation Year is created because of an amendment changing the Limitation Year to a different consecutive 12-month period, the Maximum Annual Addition will not exceed the Defined Contribution Dollar Limitation multiplied by the following fraction:

 

Number of months (including any fractional parts of a month)

in the short Limitation Year

12

 

If the Plan is terminated as of a date other than the last day of the Limitation Year, the Plan is treated as if the Plan was amended to change the Limitation Year and create a short Limitation Year ending on the date the Plan is terminated.

 

If a short Limitation Year is created, the limitation under Code Section 401(a)(17) shall be prorated in the same manner as the Defined Contribution Dollar Limitation.

 

Predecessor Employer means, with respect to a Participant, a former employer if the Employer maintains a plan that provides a benefit which the Participant accrued while performing services for the former employer.  Predecessor Employer also means, with respect to a Participant, a former entity that antedates the Employer if, under the facts and circumstances, the Employer constitutes a continuation of all or a portion of the trade or business of the former entity.

 

Severance from Employment means an employee has ceased to be an employee of the 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 the plan with respect to the employee.

 

(b)                                 If the Participant does not participate in another defined contribution plan, as defined in section 1.415(c)-1(a)(2)(i) of the regulations (without regard to whether the plan(s) have been terminated) maintained by the Employer, the amount of Annual Additions that may be credited to the Participant’s Account for any Limitation Year shall not exceed the lesser of the Maximum Annual Addition or any other limitation contained in this Plan. If the Employer Contribution that would otherwise be contributed or allocated to the Participant’s Account would cause the Annual Additions for the Limitation Year to exceed the Maximum Annual Addition, the amount contributed or allocated shall be reduced so that the Annual Additions for the Limitation Year will equal the Maximum Annual Addition.

 

(c)                                  If, in addition to this Plan, the Participant is covered under another defined contribution plan, as defined in section 1.415(c)-1(a)(2)(i) of the regulations, (without regard to whether the plan(s) have been terminated) maintained by the Employer that provides an Annual Addition during any Limitation Year, the Annual Additions that may be credited to a Participant’s Account under this

 

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Plan for any such Limitation Year will not exceed the Maximum Annual Addition, reduced by the Annual Additions credited to a Participant’s account under the other defined contribution plan(s) for the same Limitation Year. If the Annual Additions with respect to the Participant under the other defined contribution plan(s) maintained by the Employer are less than the Maximum Annual Addition, and the Employer Contribution that would otherwise be contributed or allocated to the Participant’s Account under this Plan would cause the Annual Additions for the Limitation Year to exceed this limitation, the amount contributed or allocated will be reduced so that the Annual Additions under all such plans and funds for the Limitation Year will equal the Maximum Annual Addition. If the Annual Additions with respect to the Participant under the other defined contribution plan(s) in the aggregate are equal to or greater than the Maximum Annual Addition, no amount will be contributed or allocated to the Participant’s Account under this Plan for the Limitation Year.

 

(d)                                 The limitation of this section shall be determined and applied taking into account the rules in subparagraph (e) below.

 

(e)                                  Other Rules

 

(1)                                  Aggregating Plans. For purposes of applying the limitations of this section for a Limitation Year, all defined contribution plans (as defined in section 1.415(c)-1(a)(2)(i) of the regulations and without regard to whether the plan(s) have been terminated) ever maintained by the Employer and all defined contribution plans of a Predecessor Employer (in the Limitation Year in which such Predecessor Employer is created) under which a Participant receives Annual Additions are treated as one defined contribution plan.

 

(2)                                  Break-up of Affiliated Employers. The Annual Additions under a formerly affiliated plan (as defined in section 1.415(f)-1(b)(2)(ii) of the regulations) of the Employer are taken into account for purposes of applying the limitations of this section for the Limitation Year in which the cessation of affiliation took place.

 

(3)                                  Previously Unaggregated Plans. The limitations of this section are not exceeded for the first Limitation Year in which two or more existing plans, which previously were not required to be aggregated pursuant to section 1.415(f) of the regulations, are aggregated, provided that no Annual Additions are credited to a Participant after the date on which the plans are required to be aggregated if the Annual Additions already credited to the Participant in the existing plans equal or exceed the Maximum Annual Addition.

 

(4)                                  Aggregation with Multiemployer Plan. If the Employer maintains a multiemployer plan, as defined in Code Section 414(f), and the multiemployer plan so provides, only the Annual Additions under the multiemployer plan that are provided by the Employer shall be treated as Annual Additions provided under a plan maintained by the Employer for purposes of this section.

 

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SECTION 3.05—EXCESS AMOUNTS.

 

(a)                                  Definitions. For purposes of this section, the following terms are defined:

 

ACP means, for a specified group of Participants (either Highly Compensated Employees or Nonhighly Compensated Employees) for a Plan Year, the average (expressed as a percentage) of the Contribution Percentages of the Eligible Participants in the group.

 

ADP means, for a specified group of Participants (either Highly Compensated Employees or Nonhighly Compensated Employees) for a Plan Year, the average (expressed as a percentage) of the Deferral Percentages of the Eligible Participants in the group.

 

Catch-up Contributions means Elective Deferral Contributions made to a plan that are in excess of an otherwise applicable plan limit and that are made by participants who are age 50 or older by the end of the taxable year. An otherwise applicable plan limit is a limit in the plan that applies to Elective Deferral Contributions without regard to Catch-up Contributions, such as the limits on the maximum annual additions under Code Section 415, the dollar limitation on Elective Deferral Contributions under Code Section 402(g) (not counting Catch-up Contributions), and the limit imposed by the nondiscrimination test described in Code Section 401(k)(3).

 

Contribution Percentage means the ratio (expressed as a percentage) of the Eligible Participant’s Contribution Percentage Amounts to the Eligible Participant’s Compensation for the Plan Year (whether or not the Eligible Participant was an Eligible Participant for the entire Plan Year). For an Eligible Participant for whom such Contribution Percentage Amounts for the Plan Year are zero, the percentage is zero.

 

Contribution Percentage Amounts means the sum of the Participant Contributions and Matching Contributions (that are not Qualified Matching Contributions taken into account for purposes of the ADP Test) made under the plan on behalf of the Eligible Participant for the plan year. For plan years beginning on or after January 1, 2006, Matching Contributions cannot be taken into account for a plan year for a Nonhighly Compensated Employee to the extent they are disproportionate matching contributions as defined in section 1.401(m)-2(a)(5)(ii) of the regulations. Such Contribution Percentage Amounts shall not include Matching Contributions that are forfeited either to correct Excess Aggregate Contributions or because the contributions to which they relate are Excess Elective Deferrals, Excess Contributions, or Excess Aggregate Contributions. Under such rules as the Secretary of the Treasury shall prescribe, in determining the Contribution Percentage the Employer may elect to include Qualified Nonelective Contributions under this Plan that were not used in computing the Deferral Percentage.  For plan years beginning on or after January 1, 2006, Qualified Nonelective Contributions cannot be taken into account for a plan year for a Nonhighly Compensated Employee to the extent they are disproportionate contributions as defined in section 1.401(m)-2(a)(6)(v) of the regulations. The Employer may also elect to use Elective Deferral Contributions in computing the Contribution Percentage so long as the ADP Test is met before the Elective Deferral Contributions are used in the ACP Test and continues to be met following the exclusion of those Elective Deferral Contributions that are used to meet the ACP Test.

 

Deferral Percentage means the ratio (expressed as a percentage) of Elective Deferral Contributions (other than Catch-up Contributions) under this Plan on behalf of the Eligible Participant for the Plan

 

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Year to the Eligible Participant’s Compensation for the Plan Year (whether or not the Eligible Participant was an Eligible Participant for the entire Plan Year). The Elective Deferral Contributions used to determine the Deferral Percentage shall include Excess Elective Deferrals (other than Excess Elective Deferrals of Nonhighly Compensated Employees that arise solely from Elective Deferral Contributions made under this Plan or any other plans of the Employer or a Controlled Group member), but shall exclude Elective Deferral Contributions that are used in computing the Contribution Percentage (provided the ADP Test is satisfied both with and without exclusion of these Elective Deferral Contributions). Under such rules as the Secretary of the Treasury shall prescribe, the Employer may elect to include Qualified Nonelective Contributions and Qualified Matching Contributions under this Plan in computing the Deferral Percentage.  For Plan Years beginning on or after January 1, 2006, Qualified Matching Contributions cannot be taken into account for a Plan Year for a Nonhighly Compensated Employee to the extent they are disproportionate matching contributions as defined in section 1.401(m)-2(a)(5)(ii) of the regulations.  For Plan Years beginning on or after January 1, 2006, Qualified Nonelective Contributions cannot be taken into account for a Plan Year for a Nonhighly Compensated Employee to the extent they are disproportionate contributions as defined in section 1.401(k)-2(a)(6)(iv) of the regulations. For an Eligible Participant for whom such contributions on his behalf for the Plan Year are zero, the percentage is zero.

 

Elective Deferral Contributions means any employer contributions made to a plan at the election of a participant in lieu of cash compensation.  With respect to any taxable year, a participant’s Elective Deferral Contributions are the sum of all employer contributions made on behalf of such participant pursuant to an election to defer under any qualified cash or deferred arrangement described in Code Section 401(k), any salary reduction simplified employee pension plan described in Code Section 408(k)(6), any SIMPLE IRA plan described in Code Section 408(p), any plan described under Code Section 501(c)(18), and any employer contributions made on behalf of a participant for the purchase of an annuity contract under Code Section 403(b) pursuant to a salary reduction agreement.  For taxable years beginning after December 31, 2005, Elective Deferral Contributions include Pre-tax Elective Deferral Contributions and Roth Elective Deferral Contributions. Elective Deferral Contributions shall not include any deferrals properly distributed as excess annual additions.

 

Eligible Participant means, for purposes of determining the Deferral Percentage, any Employee who is otherwise entitled to make Elective Deferral Contributions under the terms of the plan for the plan year.  Eligible Participant means, for purposes of determining the Contribution Percentage, any Employee who is eligible (i) to make a Participant Contribution or an Elective Deferral Contribution (if the Employer takes such contributions into account in the calculation of the Contribution Percentage), or (ii) to receive a Matching Contribution (including forfeitures) or a Qualified Matching Contribution.  If a Participant Contribution is required as a condition of participation in the plan, any Employee who would be a participant in the plan if such Employee made such a contribution shall be treated as an Eligible Participant on behalf of whom no Participant Contributions are made.

 

Excess Aggregate Contributions means, with respect to any Plan Year, the excess of:

 

(1)                                  The aggregate Contribution Percentage Amounts taken into account in computing the numerator of the Contribution Percentage actually made on behalf of Highly Compensated Employees for such Plan Year, over

 

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(2)                                  The maximum Contribution Percentage Amounts permitted by the ACP Test (determined by hypothetically reducing contributions made on behalf of Highly Compensated Employees in order of their Contribution Percentages beginning with the highest of such percentages).

 

Such determination shall be made after first determining Excess Elective Deferrals and then determining Excess Contributions.

 

Excess Contributions means, with respect to any Plan Year, the excess of:

 

(1)                                  The aggregate amount of employer contributions actually taken into account in computing the Deferral Percentage of Highly Compensated Employees for such Plan Year, over

 

(2)                                  The maximum amount of such contributions permitted by the ADP Test (determined by hypothetically reducing contributions made on behalf of Highly Compensated Employees in the order of the Deferral Percentages, beginning with the highest of such percentages).

 

Such determination shall be made after first determining Excess Elective Deferrals.

 

Excess Elective Deferrals means those Elective Deferral Contributions of a Participant that either (i) are made during the Participant’s taxable year and exceed the dollar limitation under Code Section 402(g) or (ii) are made during a calendar year and exceed the dollar limitation under Code Section 402(g) for the Participant’s taxable year beginning in such calendar year, counting only Elective Deferral Contributions made under this Plan and any other plan, contract, or arrangement maintained by the Employer. The dollar limitation shall be increased by the dollar limit on Catch-up Contributions under Code Section 414(v), if applicable.

 

Excess Elective Deferrals shall be treated as Annual Additions, as defined in the CONTRIBUTION LIMITATION SECTION of this article, under the Plan, unless such amounts are distributed no later than the first April 15 following the close of the Participant’s taxable year.

 

Matching Contributions means employer contributions made to this or any other defined contribution plan, or to a contract described in Code Section 403(b), on behalf of a participant on account of a Participant Contribution made by such participant, or on account of a participant’s Elective Deferral Contributions, under a plan maintained by the Employer or a Controlled Group member.

 

Participant Contributions means contributions (other than Roth Elective Deferral Contributions) made to the plan by or on behalf of a participant that are included in the participant’s gross income in the year in which made and that are maintained under a separate account to which the earnings and losses are allocated.

 

Pre-tax Elective Deferral Contributions means a participant’s Elective Deferral Contributions that are not includible in the participant’s gross income at the time deferred.

 

Qualified Matching Contributions means Matching Contributions that are nonforfeitable when made to the plan and that are distributable only in accordance with the distribution provisions (other than for hardships) applicable to Elective Deferral Contributions.

 

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Qualified Nonelective Contributions means any employer contributions (other than Matching Contributions) that an Employee may not elect to have paid to him in cash instead of being contributed to the plan and that are nonforfeitable when made to the plan and that are distributable only in accordance with the distribution provisions (other than for hardships) applicable to Elective Deferral Contributions.

 

Roth Elective Deferral Contributions means a participant’s Elective Deferral Contributions that are not excludible from the participant’s gross income at the time deferred and have been irrevocably designated as Roth Elective Deferral Contributions by the participant in his elective deferral agreement. Whether an Elective Deferral Contribution is not excludible from a participant’s gross income will be determined in accordance with section 1.40(k)-1(f)(2) of the regulations. In the case of a self-employed individual, an Elective Deferral Contribution is not excludible from gross income only if the individual does not claim a deduction for such amount.

 

(b)                                 Excess Elective Deferrals. A Participant may assign to this Plan any Excess Elective Deferrals made during a taxable year of the Participant by notifying the Plan Administrator in writing on or before the first following March 1 of the amount of the Excess Elective Deferrals to be assigned to the Plan. A Participant is deemed to notify the Plan Administrator of any Excess Elective Deferrals that arise by taking into account only those Elective Deferral Contributions made to this Plan and any other plan, contract, or arrangement of the Employer or a Controlled Group member. The Participant’s claim for Excess Elective Deferrals shall be accompanied by the Participant’s written statement that if such amounts are not distributed, such Excess Elective Deferrals will exceed the limit imposed on the Participant by Code Section 402(g) (including, if applicable, the dollar limitation on Catch-up Contributions under Code Section 414(v)) for the year in which the deferral occurred. The Excess Elective Deferrals assigned to this Plan cannot exceed the Elective Deferral Contributions allocated under this Plan for such taxable year.

 

Notwithstanding any other provisions of the Plan, Elective Deferral Contributions in an amount equal to the Excess Elective Deferrals assigned to this Plan, plus any income and minus any loss allocable thereto, shall be distributed no later than April 15 to any Participant to whose Account Excess Elective Deferrals were assigned for the preceding year and who claims Excess Elective Deferrals for such taxable year or calendar year.

 

For taxable years beginning after December 31, 2005, distribution of Excess Elective Deferrals shall be made on a pro rata basis from the Participant’s Account resulting from Pre-tax Elective Deferral Contributions and Roth Elective Deferral Contributions in the same proportion that such Contributions were made for the applicable year.

 

The Excess Elective Deferrals shall be adjusted for any income or loss.  The income or loss allocable to such Excess Elective Deferrals shall be equal to the income or loss allocable to the Participant’s Elective Deferral Contributions for the taxable year in which the excess occurred multiplied by a fraction.  The numerator of the fraction is the Excess Elective Deferrals.  The denominator of the fraction is the closing balance without regard to any income or loss occurring during such taxable year (as of the end of such taxable year) of the Participant’s Account resulting from Elective Deferral Contributions.

 

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For purposes of determining income or loss on Excess Elective Deferrals for taxable years beginning on or after January 1, 2008, no adjustment shall be made for income or loss for the gap period.

 

Any Matching Contributions that were based on the Elective Deferral Contributions distributed as Excess Elective Deferrals, plus any income and minus any loss allocable thereto, shall be forfeited.

 

(c)                                  ADP Test. As of the end of each Plan Year after Excess Elective Deferrals have been determined, the Plan must satisfy the ADP Test. The ADP Test shall be satisfied using the prior year testing method or the current year testing method, as elected by the Employer.

 

(1)                                  Prior Year Testing Method. The ADP for a Plan Year for Eligible Participants who are Highly Compensated Employees for each Plan Year and the prior year’s ADP for Eligible Participants who were Nonhighly Compensated Employees for the prior Plan Year must satisfy one of the following tests:

 

(i)                                     The ADP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year shall not exceed the prior year’s ADP for Eligible Participants who were Nonhighly Compensated Employees for the prior Plan Year multiplied by 1.25; or

 

(ii)                                  The ADP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year:

 

A.                                   shall not exceed the prior year’s ADP for Eligible Participants who were Nonhighly Compensated Employees for the prior Plan Year multiplied by 2, and

 

B.                                     the difference between such ADPs is not more than 2.

 

If this is not a successor plan, for the first Plan Year the Plan permits any Participant to make Elective Deferral Contributions, for purposes of the foregoing tests, the prior year’s Nonhighly Compensated Employees’ ADP shall be 3 percent or the Plan Year’s ADP for these Eligible Participants, as elected by the Employer.

 

(2)                                  Current Year Testing Method. The ADP for a Plan Year for Eligible Participants who are Highly Compensated Employees for each Plan Year and the ADP for Eligible Participants who are Nonhighly Compensated Employees for the Plan Year must satisfy one of the following tests:

 

(i)                                     The ADP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year shall not exceed the ADP for Eligible Participants who are Nonhighly Compensated Employees for the Plan Year multiplied by 1.25; or

 

(ii)                                  The ADP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year:

 

A.                                   shall not exceed the ADP for Eligible Participants who are Nonhighly Compensated Employees for the Plan Year multiplied by 2, and

 

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B.                                     the difference between such ADP’s is not more than 2.

 

If the Employer has elected to use the current year testing method, that election cannot be changed unless (i) the Plan has been using the current year testing method for the preceding five Plan Years, or if less, the number of Plan Years the Plan has been in existence; or (ii) if as a result of a merger or acquisition described in Code Section 410(b)(6)(C)(i), the Employer maintains both a plan using the prior year testing method and a plan using the current year testing method and the change is made within the transition period described in Code Section 410(b)(6)(C)(ii).

 

A Participant is a Highly Compensated Employee for a particular Plan Year if he meets the definition of a Highly Compensated Employee in effect for that Plan Year. Similarly, a Participant is a Nonhighly Compensated Employee for a particular Plan Year if he does not meet the definition of a Highly Compensated Employee in effect for that Plan Year.

 

The Deferral Percentage for any Eligible Participant who is a Highly Compensated Employee for the Plan Year and who is eligible to have Elective Deferral Contributions (and Qualified Nonelective Contributions or Qualified Matching Contributions, or both, if treated as Elective Deferral Contributions for purposes of the ADP Test) allocated to his account under two or more arrangements described in Code Section 401(k) that are maintained by the Employer or a Controlled Group member shall be determined as if such Elective Deferral Contributions (and, if applicable, such Qualified Nonelective Contributions or Qualified Matching Contributions, or both) were made under a single arrangement. For Plan Years beginning on or after January 1, 2006, if a Highly Compensated Employee participates in two or more cash or deferred arrangements of the Employer or of a Controlled Group member that have different plan years, all Elective Deferral Contributions made during the Plan Year shall be aggregated. For Plan Years beginning before January 1, 2006, all such cash or deferred arrangements ending with or within the same calendar year shall be treated as a single arrangement. The foregoing notwithstanding, certain plans shall be treated as separate if mandatorily disaggregated under the regulations of Code Section 401(k).

 

In the event this Plan satisfies the requirements of Code Section 401(k), 401(a)(4), or 410(b) only if aggregated with one or more other plans, or if one or more other plans satisfy the requirements of such Code sections only if aggregated with this Plan, then this section shall be applied by determining the Deferral Percentage of Employees as if all such plans were a single plan. If more than 10 percent of the Employer’s Nonhighly Compensated Employees are involved in a plan coverage change as defined in section 1.401(k)-2(c)(4) of the regulations, then any adjustments to the Nonhighly Compensated Employee ADP for the prior year shall be made in accordance with such regulations if the Employer has elected to use the prior year testing method. Plans may be aggregated in order to satisfy Code Section 401(k) only if they have the same plan year and use the same testing method for the ADP Test.

 

For purposes of the ADP Test, Elective Deferral Contributions, Qualified Nonelective Contributions, and Qualified Matching Contributions must be made before the end of the 12-month period immediately following the Plan Year to which the contributions relate.

 

If the Plan Administrator should determine during the Plan Year that the ADP Test is not being met, the Plan Administrator may limit the amount of future Elective Deferral Contributions of the Highly Compensated Employees.

 

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Notwithstanding any other provisions of this Plan, Excess Contributions, plus any income and minus any loss allocable thereto, shall be distributed no later than 12 months after the last day of a Plan Year to Participants to whose Accounts such Excess Contributions were allocated for such Plan Year, except to the extent such Excess Contributions are classified as Catch-up Contributions. Excess Contributions are allocated to the Highly Compensated Employees with the largest amounts of employer contributions taken into account in calculating the ADP Test for the year in which the excess arose, beginning with the Highly Compensated Employee with the largest amount of such employer contributions and continuing in descending order until all of the Excess Contributions have been allocated. For Plan Years beginning on or after January 1, 2006, if a Highly Compensated Employee participates in two or more cash or deferred arrangements of the Employer or of a Controlled Group member, the amount distributed shall not exceed the amount of the employer contributions taken into account in calculating the ADP test and made to this Plan for the year in which the excess arose. If Catch-up Contributions are allowed for the Plan Year being tested, to the extent a Highly Compensated Employee has not reached his Catch-up Contribution limit under the Plan for such year, Excess Contributions allocated to such Highly Compensated Employee are Catch-up Contributions and will not be treated as Excess Contributions. If such excess amounts (other than Catch-up Contributions) are distributed more than 2 1/2 months after the last day of the Plan Year in which such excess amounts arose, a 10 percent excise tax shall be imposed on the employer maintaining the plan with respect to such amounts.

 

Excess Contributions shall be treated as Annual Additions, as defined in the CONTRIBUTION LIMITATION SECTION of this article, even if distributed.

 

The Excess Contributions shall be adjusted for any income or loss. The income or loss allocable to such Excess Contributions allocated to each Participant shall be equal to the income or loss allocable to the Participant’s Elective Deferral Contributions (and, if applicable, Qualified Nonelective Contributions or Qualified Matching Contributions, or both) for the Plan Year in which the excess occurred multiplied by a fraction.  The numerator of the fraction is the Excess Contributions.  The denominator of the fraction is the closing balance without regard to any income or loss occurring during such Plan Year (as of the end of such Plan Year) of the Participant’s Account resulting from Elective Deferral Contributions (and Qualified Nonelective Contributions or Qualified Matching Contributions, or both, if such contributions are included in the ADP Test).

 

For purposes of determining income or loss on Excess Contributions for Plan Years beginning on or after January 1, 2008, no adjustment shall be made for income or loss for the gap period.

 

Excess Contributions allocated to a Participant shall be distributed from the Participant’s Account resulting from Elective Deferral Contributions. If such Excess Contributions exceed the amount of Excess Contributions in the Participant’s Account resulting from Elective Deferral Contributions, the balance shall be distributed from the Participant’s Account resulting from Qualified Matching Contributions (if applicable) and Qualified Nonelective Contributions, respectively.

 

For taxable years beginning after December 31, 2005, distribution of Excess Contributions shall be made on a pro rata basis from the Participant’s Account resulting from Pre-tax Elective Deferral Contributions and Roth Elective Deferral Contributions in the same proportion that such Contributions were made for the applicable year.

 

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Any Matching Contributions that were based on the Elective Deferral Contributions distributed as Excess Contributions, plus any income and minus any loss allocable thereto, shall be forfeited.

 

(d)                                 ACP Test. As of the end of each Plan Year, the Plan must satisfy the ACP Test. The ACP Test shall be satisfied using the prior year testing method or the current year testing method, as elected by the Employer.

 

(1)                                  Prior Year Testing Method. The ACP for a Plan Year for Eligible Participants who are Highly Compensated Employees for each Plan Year and the prior year’s ACP for Eligible Participants who were Nonhighly Compensated Employees for the prior Plan Year must satisfy one of the following tests:

 

(i)                                     The ACP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year shall not exceed the prior year’s ACP for Eligible Participants who were Nonhighly Compensated Employees for the prior Plan Year multiplied by 1.25; or

 

(ii)                                  The ACP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year:

 

A.                                   shall not exceed the prior year’s ACP for Eligible Participants who were Nonhighly Compensated Employees for the prior Plan Year multiplied by 2, and

 

B.                                     the difference between such ACPs is not more than 2.

 

If this is not a successor plan, for the first Plan Year the Plan permits any Participant to make Participant Contributions, provides for Matching Contributions, or both, for purposes of the foregoing tests, the prior year’s Nonhighly Compensated Employees’ ACP shall be 3 percent or the Plan Year’s ACP for these Eligible Participants, as elected by the Employer.

 

(2)                                  Current Year Testing Method. The ACP for a Plan Year for Eligible Participants who are Highly Compensated Employees for each Plan Year and the ACP for Eligible Participants who are Nonhighly Compensated Employees for the Plan Year must satisfy one of the following tests:

 

(i)                                     The ACP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year shall not exceed the ACP for Eligible Participants who are Nonhighly Compensated Employees for the Plan Year multiplied by 1.25; or

 

(ii)                                  The ACP for a Plan Year for Eligible Participants who are Highly Compensated Employees for the Plan Year:

 

A.                                   shall not exceed the ACP for Eligible Participants who are Nonhighly Compensated Employees for the Plan Year multiplied by 2, and

 

B.                                     the difference between such ACPs is not more than 2.

 

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If the Employer has elected to use the current year testing method, that election cannot be changed unless (i) the Plan has been using the current year testing method for the preceding five Plan Years, or if less, the number of Plan Years the Plan has been in existence; or (ii) if as a result of a merger or acquisition described in Code Section 410(b)(6)(C)(i), the Employer maintains both a plan using the prior year testing method and a plan using the current year testing method and the change is made within the transition period described in Code Section 410(b)(6)(C)(ii).

 

A Participant is a Highly Compensated Employee for a particular Plan Year if he meets the definition of a Highly Compensated Employee in effect for that Plan Year. Similarly, a Participant is a Nonhighly Compensated Employee for a particular Plan Year if he does not meet the definition of a Highly Compensated Employee in effect for that Plan Year.

 

The Contribution Percentage for any Eligible Participant who is a Highly Compensated Employee for the Plan Year and who is eligible to have Contribution Percentage Amounts allocated to his account under two or more plans described in Code Section 401(a) or arrangements described in Code Section 401(k) that are maintained by the Employer or a Controlled Group member shall be determined as if the total of such Contribution Percentage Amounts was made under each plan and arrangement. For Plan Years beginning on or after January 1, 2006, if a Highly Compensated Employee participates in two or more such plans or arrangements that have different plan years, all Contribution Percentage Amounts made during the Plan Year shall be aggregated. For Plan Years beginning before January 1, 2006, all such plans and arrangements ending with or within the same calendar year shall be treated as a single plan or arrangement.  The foregoing notwithstanding, certain plans shall be treated as separate if mandatorily disaggregated under the regulations of Code Section 401(m).

 

In the event this Plan satisfies the requirements of Code Section 401(m), 401(a)(4), or 410(b) only if aggregated with one or more other plans, or if one or more other plans satisfy the requirements of such Code sections only if aggregated with this Plan, then this section shall be applied by determining the Contribution Percentage of Employees as if all such plans were a single plan. If more than 10 percent of the Employer’s Nonhighly Compensated Employees are involved in a plan coverage change as defined in section 1.401(m)-2(c)(4) of the regulations, then any adjustments to the Nonhighly Compensated Employee ACP for the prior year shall be made in accordance with such regulations if the Employer has elected to use the prior year testing method. Plans may be aggregated in order to satisfy Code Section 401(m) only if they have the same plan year and use the same testing method for the ACP Test.

 

For purposes of the ACP Test, Participant Contributions are considered to have been made in the Plan Year in which contributed to the Plan.  Matching Contributions and Qualified Nonelective Contributions will be considered to have been made for a Plan Year if made no later than the end of the 12-month period beginning on the day after the close of the Plan Year.

 

Notwithstanding any other provisions of this Plan, Excess Aggregate Contributions, plus any income and minus any loss allocable thereto, shall be forfeited, if not vested, or distributed, if vested, no later than 12 months after the last day of a Plan Year to Participants to whose Accounts such Excess Aggregate Contributions were allocated for such Plan Year.  Excess Aggregate Contributions are allocated to the Highly Compensated Employees with the largest Contribution Percentage Amounts taken into account in calculating the ACP Test for the year in

 

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which the excess arose, beginning with the Highly Compensated Employee with the largest amount of such Contribution Percentage Amounts and continuing in descending order until all of the Excess Aggregate Contributions have been allocated. For Plan Years beginning on or after January 1, 2006, if a Highly Compensated Employee participates in two or more plans or arrangements of the Employer or of a Controlled Group member that include Contribution Percentage Amounts, the amount distributed shall not exceed the Contribution Percentage Amounts taken into account in calculating the ACP Test and made to this Plan for the year in which the excess arose. If such Excess Aggregate Contributions are distributed more than 2 1/2 months after the last day of the Plan Year in which such excess amounts arose, a 10 percent excise tax shall be imposed on the employer maintaining the plan with respect to such amounts.

 

Excess Aggregate Contributions shall be treated as Annual Additions, as defined in the CONTRIBUTION LIMITATION SECTION of this article, even if distributed.

 

The Excess Aggregate Contributions shall be adjusted for any income or loss. The income or loss allocable to such Excess Aggregate Contributions allocated to each Participant shall be equal to the income or loss allocable to the Participant’s Contribution Percentage Amounts for the Plan Year in which the excess occurred multiplied by a fraction. The numerator of the fraction is the Excess Aggregate Contributions. The denominator of the fraction is the closing balance without regard to any income or loss occurring during such Plan Year (as of the end of such Plan Year) of the Participant’s Account resulting from Contribution Percentage Amounts.

 

For purposes of determining income or loss on Excess Aggregate Contributions for Plan Years beginning on or after January 1, 2008, no adjustment shall be made for income or loss for the gap period.

 

Excess Aggregate Contributions allocated to a Participant shall be distributed from the Participant’s Account resulting from Participant Contributions that are not required as a condition of employment or participation or for obtaining additional benefits from Employer Contributions. If such Excess Aggregate Contributions exceed the balance in the Participant’s Account resulting from such Participant Contributions, the balance shall be forfeited, if not vested, or distributed, if vested, on a pro rata basis from the Participant’s Account resulting from Contribution Percentage Amounts.

 

(e)                                  Employer Elections. The Employer has made an election to use the prior year testing method.

 

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ARTICLE IV

 

INVESTMENT OF CONTRIBUTIONS

 

SECTION 4.01—INVESTMENT AND TIMING OF CONTRIBUTIONS.

 

The handling of Contributions and Plan assets is governed by the provisions of the Trust Agreement and any other relevant document, such as an Annuity Contract (for the purposes of this paragraph alone, the Trust Agreement and such other documents will each be referred to as a “document” or collectively as the “documents”), duly entered into by or with regard to the Plan that govern such matters.  To the extent permitted by the documents, the parties named below shall direct the Contributions for investment in any of the investment options or investment vehicles available to the Plan under or through the documents, and may request the transfer of amounts resulting from those Contributions between such investment options and investment vehicles.  A Participant may not direct the investment of all or any portion of his Account in collectibles.  Collectibles mean any work of art, rug or antique, metal or gem, stamp or coin, alcoholic beverage, or other tangible personal property specified by the Secretary of the Treasury. However, for tax years beginning after December 31, 1997, certain coins and bullion as provided in Code Section 408(m)(3) shall not be considered collectibles. To the extent that a Participant who has the ability to provide investment direction fails to give timely investment direction, the amount for which no investment direction is in place shall be invested in such investment options and investment vehicles as provided in the service and expense agreement or such other documents duly entered into by or with regard to the Plan that govern such matters. If the Primary Employer has investment direction, the Contributions shall be invested ratably in the investment options and investment vehicles available to the Plan under or through the documents. The Primary Employer shall have investment direction for amounts that have not been allocated to Participants. To the extent an investment is no longer available, the Primary Employer may require that amounts currently held in such investment be reinvested in other investments.

 

At least annually, the Named Fiduciary shall review all pertinent Employee information and Plan data in order to establish the funding policy of the Plan and to determine appropriate methods of carrying out the Plan’s objectives. The Named Fiduciary shall inform the Trustee and any Investment Manager of the Plan’s short-term and long-term financial needs so the investment policy can be coordinated with the Plan’s financial requirements.

 

(a)                                  Elective Deferral Contributions. The Participant shall direct the investment of Elective Deferral Contributions and transfer of amounts resulting from those Contributions.

 

(b)                                 Employer Contributions other than Elective Deferral Contributions: The Participant shall direct the investment of such Employer Contributions and transfer of amounts resulting from those Contributions.

 

(c)                                  Rollover Contributions: The Participant shall direct the investment of Rollover Contributions and transfer of amounts resulting from those Contributions.

 

However, the Named Fiduciary may delegate to the Investment Manager investment direction for Contributions and amounts that are not subject to Participant direction.

 

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All Contributions are forwarded by the Employer to (i) the Trustee to be deposited in the Trust Fund or otherwise invested by the Trustee in accordance with the relevant documents; or (ii) the Insurer to be deposited under the Annuity Contract, as applicable.

 

SECTION 4.01A—INVESTMENT IN QUALIFYING EMPLOYER SECURITIES.

 

All or some portion of the Participant’s Account may be invested in Qualifying Employer Securities. Once an investment in the Qualifying Employer Securities Fund is made available to Participants, it shall continue to be available unless the Plan is amended to disallow such available investment. In the absence of an election to invest in Qualifying Employer Securities, Participants shall be deemed to have elected to have their Accounts invested wholly in other investment options of the Investment Fund. Once an election is made, it shall be considered to continue until a new election is made.

 

For purposes of determining the annual valuation of the Plan, and for reporting to Participants and regulatory authorities, the assets of the Plan shall be valued at least annually on the Valuation Date which corresponds to the last day of the Plan Year. The fair market value of Qualifying Employer Securities shall be determined on such Valuation Date.  The prices of Qualifying Employer Securities as of the date of the transaction shall apply for purposes of valuing distributions and other transactions of the Plan to the extent such value is representative of the fair market value of such securities in the opinion of the Plan Administrator. The value of a Participant’s Account held in the Qualifying Employer Securities Fund may be expressed in units.

 

If the Qualifying Employer Securities are not publicly traded, or if an extremely thin market exists for such securities so that reasonable valuation may not be obtained from the market place, then such securities must be valued at least annually by an independent appraiser who is not associated with the Employer, the Plan Administrator, the Trustee, or any person related to any fiduciary under the Plan.  The independent appraiser may be associated with a person who is merely a contract administrator with respect to the Plan, but who exercises no discretionary authority and is not a plan fiduciary.

 

If there is a public market for Qualifying Employer Securities of the type held by the Plan, then the Plan Administrator may use as the value of the securities the price at which such securities trade in such market. If the Qualifying Employer Securities do not trade on the relevant date, or if the market is very thin on such date, then the Plan Administrator may use for the valuation the next preceding trading day on which the trading prices are representative of the fair market value of such securities in the opinion of the Plan Administrator.

 

Cash dividends payable on the Qualifying Employer Securities shall be reinvested in additional shares of such securities. In the event of any cash or stock dividend or any stock split, such dividend or split shall be credited to the Accounts based on the number of shares of Qualifying Employer Securities credited to each Account as of the payable date of such dividend or split.

 

All purchases of Qualifying Employer Securities shall be made at a price, or prices, which, in the judgment of the Plan Administrator, do not exceed the fair market value of such securities.

 

In the event that the Trustee acquires Qualifying Employer Securities by purchase from a “disqualified person” as defined in Code Section 4975(e)(2) or from a “party-in-interest” as defined in ERISA Section 3(14), the terms of such purchase shall contain the provision that in the event there is a final determination by the Internal Revenue Service, the Department of Labor, or court of competent jurisdiction that the fair market value of such securities as of the date of purchase was less than the purchase price paid by the Trustee, then the seller shall pay or transfer, as the case may be, to the Trustee an amount of cash or shares of Qualifying

 

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Employer Securities equal in value to the difference between the purchase price and such fair market value for all such shares. In the event that cash or shares of Qualifying Employer Securities are paid or transferred to the Trustee under this provision, such securities shall be valued at their fair market value as of the date of such purchase, and interest at a reasonable rate from the date of purchase to the date of payment or transfer shall be paid by the seller on the amount of cash paid.

 

The Plan Administrator may direct the Trustee to sell, resell, or otherwise dispose of Qualifying Employer Securities to any person, including the Employer, provided that any such sales to any disqualified person or party-in-interest, including the Employer, will be made at not less than the fair market value and no commission will be charged. Any such sale shall be made in conformance with ERISA Section 408(e).

 

The Employer is responsible for compliance with any applicable Federal or state securities law with respect to all aspects of the Plan. If the Qualifying Employer Securities or interest in this Plan are required to be registered in order to permit investment in the Qualifying Employer Securities Fund as provided in this section, then such investment will not be effective until the later of the effective date of the Plan or the date such registration or qualification is effective. The Employer, at its own expense, will take or cause to be taken any and all such actions as may be necessary or appropriate to effect such registration or qualification. Further, if the Trustee is directed to dispose of any Qualifying Employer Securities held under the Plan under circumstances which require registration or qualification of the securities under applicable Federal or state securities laws, then the Employer will, at its own expense, take or cause to be taken any and all such action as may be necessary or appropriate to effect such registration or qualification. The Employer is responsible for all compliance requirements under Section 16 of the Securities Act.

 

The diversification requirements below apply for Plan Years beginning on or after January 1, 2007.

 

Diversification Requirements.

 

An applicable individual (as defined in Internal Revenue Service Notice 2006-107) is permitted to elect to direct any publicly traded qualifying employer securities (as defined in Code Section 401(a)(35(G)(v)) held in his Account under the Plan to be reinvested in other investment options offered under the Plan with respect to the portion of his Account that is subject to Code Section 401(a)(35)(B) or (C). The plan sponsor may permit diversification of amounts invested in qualifying employer securities earlier than required as long as the earlier time period is applied consistently to all employees.

 

The Plan shall offer at least three investment options, other than Qualifying Employer Securities, to which the applicable individual may direct all or any portion of his Account invested in Qualifying Employer Securities, and each investment option must be diversified and have materially different risk and return characteristics that satisfy the requirements of section 2550.404c-1(b)(3) of the Department of Labor regulations. The Plan may limit the time for divestment and reinvestment to periodic, reasonable opportunities occurring no less frequently than quarterly.  The Plan may not impose any restrictions or conditions with respect to the investment of Qualifying Employer Securities that are not imposed on the investment options offered under the Plan.

 

A notice must be provided to each applicable individual that describes the divestiture rights and the importance of diversifying the investment of retirement plan assets. The Plan Administrator shall provide the notice to all applicable individuals no later than 30 days before the date on which the applicable individuals are eligible to exercise their right to diversify.

 

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ARTICLE V

 

BENEFITS

 

SECTION 5.01—RETIREMENT BENEFITS.

 

On a Participant’s Retirement Date, his Vested Account shall be distributed to him according to the distribution of benefits provisions of Article VI and the provisions of the SMALL AMOUNTS SECTION of Article X.

 

SECTION 5.02—DEATH BENEFITS.

 

If a Participant dies before his Annuity Starting Date, his Vested Account shall be distributed according to the distribution of benefits provisions of Article VI and the provisions of the SMALL AMOUNTS SECTION of Article X.

 

SECTION 5.03—VESTED BENEFITS.

 

If an Inactive Participant’s Vested Account is not payable under the SMALL AMOUNTS SECTION of Article X, he may elect, but is not required, to receive a distribution of any part of his Vested Account after he has a Severance from Employment.  The Participant’s election shall be subject to his spouse’s consent as provided in the ELECTION PROCEDURES SECTION of Article VI. A distribution under this paragraph shall be a retirement benefit and shall be distributed to the Participant according to the distribution of benefits provisions of Article VI.

 

A Participant may not elect to receive a distribution under the provisions of this section after he again becomes an Employee until he subsequently has a Severance from Employment and meets the requirements of this section.

 

If an Inactive Participant does not receive an earlier distribution, upon his Retirement Date or death, his Vested Account shall be distributed according to the provisions of the RETIREMENT BENEFITS SECTION or the DEATH BENEFITS SECTION of this article.

 

The Nonvested Account of an Inactive Participant who has had a Severance from Employment shall remain a part of his Account until it becomes a Forfeiture. However, if he again becomes an Employee so that his Vesting Percentage can increase, the Nonvested Account may become a part of his Vested Account.

 

SECTION 5.04—WHEN BENEFITS START.

 

(a)                                  Unless otherwise elected, benefits shall begin before the 60th day following the close of the Plan Year in which the latest date below occurs:

 

(1)                                  The date the Participant attains age 65 (or Normal Retirement Age, if earlier).

 

(2)                                  The 10th anniversary of the Participant’s earliest Entry Date.

 

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(3)                                  The date the Participant terminates service with the Employer.

 

Notwithstanding the foregoing, the failure of a Participant and spouse to consent to a distribution while a benefit is immediately distributable, within the meaning of the ELECTION PROCEDURES SECTION of Article VI, shall be deemed to be an election to defer the start of benefits sufficient to satisfy this section.

 

The Participant may elect to have benefits begin after the latest date for beginning benefits described above, subject to the following provisions of this section. The Participant shall make the election in writing. Such election must be made before his Normal Retirement Date or the date he has a Severance from Employment, if later. The Participant shall not elect a date for beginning benefits or a form of distribution that would result in a benefit payable when he dies which would be more than incidental within the meaning of governmental regulations.

 

Benefits shall begin on an earlier date if otherwise provided in the Plan. For example, the Participant’s Retirement Date or Required Beginning Date, as defined in the DEFINITIONS SECTION of Article VII.

 

(b)                                 The Participant’s Vested Account that results from Elective Deferral Contributions and Qualified Nonelective Contributions may not be distributed earlier than Severance from Employment (separation from service, for Plan Years beginning before January 1, 2002), death, or disability.  Such amount may also be distributed upon:

 

(1)                                  Termination of the Plan, as permitted in Article VIII.

 

(2)                                  The attainment of age 59 1/2 as permitted in the WITHDRAWAL BENEFITS SECTION of this article or in the definition of Normal Retirement Date in the DEFINITIONS SECTION of Article I.

 

Elective Deferral Contributions may also be distributed upon the hardship of the Participant as permitted in the WITHDRAWAL BENEFITS SECTION of this article.

 

All distributions that may be made pursuant to one or more of the foregoing distributable events will be a retirement benefit and shall be distributed to the Participant according to the distribution of benefits provisions of Article VI. In addition, distributions that are triggered by the termination of the Plan must be made in a lump sum. A lump sum shall include a distribution of an annuity contract.

 

SECTION 5.05—WITHDRAWAL BENEFITS.

 

A Participant may withdraw any part of his Vested Account resulting from Rollover Contributions. A Participant may make such a withdrawal at any time.

 

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A Participant who has attained age 59 1/2 may withdraw any part of his Vested Account resulting from the following Contributions:

 

Elective Deferral Contributions

Matching Contributions

Qualified Nonelective Contributions

Discretionary Contributions

 

A Participant may make such a withdrawal at any time.

 

A Participant may withdraw any part of his Vested Account resulting from the following Contributions:

 

Elective Deferral Contributions

Matching Contributions

Discretionary Contributions

 

in the event of hardship due to an immediate and heavy financial need. Withdrawals from the Participant’s Account resulting from Elective Deferral Contributions shall be limited to the amount of the Participant’s Elective Deferral Contributions. The portion of the Participant’s Account held in the Qualifying Employer Securities Fund may be redeemed for purposes of a hardship withdrawal only after the amount held in other investment options has been depleted.

 

Immediate and heavy financial need shall be limited to: (i) expenses incurred or necessary for medical care that would be deductible under Code Section 213(a) (determined without regard to whether the expenses exceed 7.5% of adjusted gross income); (ii) the purchase (excluding mortgage payments) of a principal residence for the Participant; (iii) payment of tuition, related educational fees, and room and board expenses, for the next 12 months of post-secondary education for the Participant, his spouse, children, or dependents (as defined in Code Section 152 without regard to Code Sections 152(b)(1), (b)(2), and (d)(1)(B)); (iv) payments necessary to prevent the eviction of the Participant from, or foreclosure on the mortgage of, the Participant’s principal residence; (v) payments for funeral or burial expenses for the Participant’s deceased parent, spouse, child, or dependent (as defined in Code Section 152 without regard to Code Section 152(d))1)(B)); (vi) expenses to repair damage to the Participant’s principal residence that would qualify for a casualty loss deduction under Code Section 165 (determined without regard to whether the loss exceeds 10% of adjusted gross income); or (vii) any other distribution which is deemed by the Commissioner of Internal Revenue to be made on account of immediate and heavy financial need as provided in Treasury regulations.

 

No withdrawal shall be allowed which is not necessary to satisfy such immediate and heavy financial need. Such withdrawal shall be deemed necessary only if all of the following requirements are met: (i) the distribution is not in excess of the amount of the immediate and heavy financial need (including amounts necessary to pay any Federal, state, or local income taxes or penalties reasonably anticipated to result from the distribution); (ii) the Participant has obtained all distributions, other than hardship distributions, and all nontaxable loans currently available under all plans maintained by the Employer; and (iii) the Plan, and all other plans maintained by the Employer, provide that the Participant’s elective contributions and participant contributions will be suspended for at least six months after receipt of the hardship distribution. The Plan will suspend elective contributions and participant contributions for six months as provided in the preceding sentence. A Participant shall not cease to be an Eligible Participant, as defined in the EXCESS AMOUNTS SECTION of Article III, merely because his elective contributions or participant contributions are suspended.

 

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A request for withdrawal shall be made in such manner and in accordance with such rules as the Employer will prescribe for this purpose (including by means of voice response or other electronic means under circumstances the Employer permits). Withdrawals shall be a retirement benefit and shall be distributed to the Participant according to the distribution of benefits provisions of Article VI. A forfeiture shall not occur solely as a result of a withdrawal.

 

SECTION 5.06—LOANS TO PARTICIPANTS.

 

Loans shall be made available to all Participants on a reasonably equivalent basis. For purposes of this section, and unless otherwise specified, Participant means any Participant or Beneficiary who is a party-in-interest as defined in ERISA. Loans shall not be made to Highly Compensated Employees in an amount greater than the amount made available to other Participants.

 

A loan to a Participant shall be a Participant-directed investment of his Account. The portion of the Participant’s Account held in the Qualifying Employer Securities Fund may be redeemed for purposes of a loan only after the amount held in other investment options has been depleted. The loan is a Trust Fund investment but no Account other than the borrowing Participant’s Account shall share in the interest paid on the loan or bear any expense or loss incurred because of the loan.

 

The number of outstanding loans shall be limited to one. No more than one loan shall be approved for any Participant in any 12-month period. The minimum amount of any loan shall be $1,000.

 

Loans must be adequately secured and bear a reasonable rate of interest.

 

The amount of the loan shall not exceed the maximum amount that may be treated as a loan under Code Section 72(p) (rather than a distribution) to the Participant and shall be equal to the lesser of (a) or (b) below:

 

(a)                                  $50,000, reduced by the highest outstanding loan balance of loans during the one-year period ending on the day before the new loan is made.

 

(b)                                 The greater of (1) or (2), reduced by (3) below:

 

(1)                                  One-half of the Participant’s Vested Account (without regard to any accumulated deductible employee contributions, as defined in Code Section 72(o)(5)(B)).

 

(2)                                  $10,000.

 

(3)                                  Any outstanding loan balance on the date the new loan is made.

 

For purposes of this maximum, all qualified employer plans, as defined in Code Section 72(p)(4), of the Employer and any Controlled Group member shall be treated as one plan.

 

The foregoing notwithstanding, the amount of such loan shall not exceed 50 percent of the amount of the Participant’s Vested Account. For purposes of this maximum, a Participant’s Vested Account does not include any accumulated deductible employee contributions, as defined in Code Section 72(o)(5)(B).  No collateral other than a portion of the Participant’s Vested Account (as limited above) shall be accepted.

 

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The Participant’s outstanding loan balance shall include any deemed distribution, along with accrued interest, that has not been repaid (offset).

 

A Participant must obtain the consent of his spouse, if any, to the use of the Vested Account as security for the loan. Spousal consent shall be obtained no earlier than the beginning of the 90-day period that ends on the date on which the loan to be so secured is made.  The consent must be in writing, must acknowledge the effect of the loan, and must be witnessed by a plan representative or a notary public. Such consent shall thereafter be binding with respect to the consenting spouse or any subsequent spouse with respect to that loan.  A new consent shall be required if the Vested Account is used for collateral upon renegotiation, extension, renewal, or other revision of the loan. No consent shall be required if subparagraph (d) of the ELECTION PROCEDURES SECTION of Article VI applies.

 

If a valid spousal consent has been obtained in accordance with the above, or spousal consent is not required, then, notwithstanding any other provision of this Plan, the portion of the Participant’s Vested Account used as a security interest held by the Plan by reason of a loan outstanding to the Participant shall be taken into account for purposes of determining the amount of the Vested Account payable at the time of death or distribution, but only if the reduction is used as repayment of the loan. If spousal consent is required and less than 100 percent of the Participant’s Vested Account (determined without regard to the preceding sentence) is payable to the surviving spouse, then the Vested Account shall be adjusted by first reducing the Vested Account by the amount of the security used as repayment of the loan, and then determining the benefit payable to the surviving spouse.

 

Each loan shall bear a reasonable fixed rate of interest to be determined by the Loan Administrator. In determining the interest rate, the Loan Administrator shall take into consideration fixed interest rates currently being charged by commercial lenders for loans of comparable risk on similar terms and for similar durations, so that the interest will provide for a return commensurate with rates currently charged by commercial lenders for loans made under similar circumstances. The Loan Administrator shall not discriminate among Participants in the matter of interest rates; but loans granted at different times may bear different interest rates in accordance with the current appropriate standards.

 

The loan shall by its terms require that repayment (principal and interest) be amortized in level payments, not less frequently than quarterly, over a period not extending beyond five years from the date of the loan. If the loan is used to acquire a dwelling unit, which within a reasonable time (determined at the time the loan is made) will be used as the principal residence of the Participant, the repayment period may extend beyond five years from the date of the loan, but the extended period shall be the lesser of 15 years or a repayment period consistent with commercial home loan practices.

 

The Participant shall make an application for a loan in such manner and in accordance with such rules as the Employer shall prescribe for this purpose (including by means of voice response or other electronic means under circumstances the Employer permits). The application must specify the amount and duration requested.

 

Information contained in the application for the loan concerning the income, liabilities, and assets of the Participant will be evaluated to determine whether there is a reasonable expectation that the Participant will be able to satisfy payments on the loan as due. Additionally, the Loan Administrator will pursue any appropriate further investigations concerning the creditworthiness and credit history of the Participant to determine whether a loan should be approved.

 

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Each loan shall be fully documented in the form of a promissory note signed by the Participant for the face amount of the loan, together with interest determined as specified above.

 

There will be an assignment of collateral to the Plan executed at the time the loan is made.

 

In those cases where repayment through payroll deduction is available, installments are so payable, and a payroll deduction agreement shall be executed by the Participant at the time the loan is made.  If the Participant has previously been treated as having received a deemed distribution and the subsequent loan is being made before the deemed distribution, along with accrued interest, has been repaid (or offset), a payroll deduction agreement shall be required for loans made on or after January 1, 2004. If a payroll deduction agreement is required because of a previous deemed distribution and the Participant later revokes such agreement, the outstanding loan balance at the time of the revocation shall be treated as a deemed distribution.

 

Where payroll deduction is not available, payments in cash are to be timely made. Any payment that is not by payroll deduction shall be made payable to the Employer or the Trustee, as specified in the promissory note, and delivered to the Loan Administrator, including prepayments, service fees and penalties, if any, and other amounts due under the note.

 

The promissory note may provide for reasonable late payment penalties and service fees. Any penalties or service fees shall be applied to all Participants in a nondiscriminatory manner. If the promissory note so provides, such amounts may be assessed and collected from the Account of the Participant as part of the loan balance.

 

Each loan may be paid prior to maturity, in part or in full, without penalty or service fee, except as may be set out in the promissory note.

 

The Plan shall suspend loan payments for a period not exceeding one year during which an approved unpaid leave of absence occurs other than a military leave of absence. The Loan Administrator shall provide the Participant a written explanation of the effect of the suspension of payments upon his loan.

 

If a Participant separates from service (or takes a leave of absence) from the Employer because of service in the military and does not receive a distribution of his Vested Account, the Plan shall suspend loan payments until the Participant’s completion of military service or until the Participant’s fifth anniversary of commencement of military service, if earlier, as permitted under Code Section 414(u). The Loan Administrator shall provide the Participant a written explanation of the effect of his military service upon his loan.

 

If any payment of principal and interest, or any portion thereof, remains unpaid for more than 90 days after due, the loan shall be in default. For purposes of Code Section 72(p), the Participant shall then be treated as having received a deemed distribution regardless of whether or not a distributable event has occurred.

 

Upon default, the Plan has the right to pursue any remedy available by law to satisfy the amount due, along with accrued interest, including the right to enforce its claim against the security pledged and execute upon the collateral as allowed by law. The entire principal balance whether or not otherwise then due, along with accrued interest, shall become immediately due and payable without demand or notice, and subject to collection or satisfaction by any lawful means, including specifically, but not limited to, the right to enforce the claim against the security pledged and to execute upon the collateral as allowed by law.

 

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In the event of default, foreclosure on the note and attachment of security or use of amounts pledged to satisfy the amount then due shall not occur until a distributable event occurs in accordance with the Plan, and shall not occur to an extent greater than the amount then available upon any distributable event which has occurred under the Plan.

 

All reasonable costs and expenses, including but not limited to attorney’s fees, incurred by the Plan in connection with any default or in any proceeding to enforce any provision of a promissory note or instrument by which a promissory note for a Participant loan is secured, shall be assessed and collected from the Account of the Participant as part of the loan balance.

 

If payroll deduction is being utilized, in the event that a Participant’s available payroll deduction amounts in any given month are insufficient to satisfy the total amount due, there will be an increase in the amount taken subsequently, sufficient to make up the amount that is then due. If any amount remains past due more than 90 days, the entire principal amount, whether or not otherwise then due, along with interest then accrued, shall become due and payable, as above.

 

If no distributable event has occurred under the Plan at the time that the Participant’s Vested Account would otherwise be used under this provision to pay any amount due under the outstanding loan, this will not occur until the time, or in excess of the extent to which, a distributable event occurs under the Plan. An outstanding loan will become due and payable in full 60 days after a Participant has a Severance from Employment and ceases to be a party-in-interest as defined in ERISA or after complete termination of the Plan.

 

SECTION 5.07—DISTRIBUTIONS UNDER QUALIFIED DOMESTIC RELATIONS ORDERS.

 

The Plan specifically permits distributions to an Alternate Payee under a qualified domestic relations order as defined in Code Section 414(p), at any time, irrespective of whether the Participant has attained his earliest retirement age, as defined in Code Section 414(p), under the Plan. A distribution to an Alternate Payee before the Participant has attained his earliest retirement age is available only if the order specifies that distribution shall be made prior to the earliest retirement age or allows the Alternate Payee to elect a distribution prior to the earliest retirement age.

 

Nothing in this section shall permit a Participant to receive a distribution at a time otherwise not permitted under the Plan nor shall it permit the Alternate Payee to receive a form of payment not permitted under the Plan.

 

The benefit payable to an Alternate Payee shall be subject to the provisions of the SMALL AMOUNTS SECTION of Article X if the value of the benefit does not exceed $5,000.

 

The Plan Administrator shall establish reasonable procedures to determine the qualified status of a domestic relations order.  Upon receiving a domestic relations order, the Plan Administrator shall promptly notify the Participant and each Alternate Payee named in the order, in writing, of the receipt of the order and the Plan’s procedures for determining the qualified status of the order. Within a reasonable period of time after receiving the domestic relations order, the Plan Administrator shall determine the qualified status of the order and shall notify the Participant and each Alternate Payee, in writing, of its determination.  The Plan Administrator shall provide notice under this paragraph by mailing to the individual’s address specified in the domestic relations order, or in a manner consistent with Department of Labor regulations.  The Plan Administrator may treat as qualified any domestic relations order entered before January 1, 1985, irrespective of whether it satisfies all the requirements described in Code Section 414(p).

 

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If any portion of the Participant’s Vested Account is payable during the period the Plan Administrator is making its determination of the qualified status of the domestic relations order, a separate accounting shall be made of the amount payable. If the Plan Administrator determines the order is a qualified domestic relations order within 18 months of the date amounts are first payable following receipt of the order, the payable amounts shall be distributed in accordance with the order.  If the Plan Administrator does not make its determination of the qualified status of the order within the 18-month determination period, the payable amounts shall be distributed in the manner the Plan would distribute if the order did not exist and the order shall apply prospectively if the Plan Administrator later determines the order is a qualified domestic relations order.

 

The Plan shall make payments or distributions required under this section by separate benefit checks or other separate distribution to the Alternate Payee(s).

 

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ARTICLE VI

 

DISTRIBUTION OF BENEFITS

 

SECTION 6.01—AUTOMATIC FORMS OF DISTRIBUTION.

 

Unless an optional form of benefit is selected pursuant to a qualified election within the election period (see the ELECTION PROCEDURES SECTION of this article), the automatic form of benefit payable to or on behalf of a Participant is determined as follows:

 

(a)                                  Retirement Benefits. The automatic form of retirement benefit for a Participant who does not die before his Annuity Starting Date shall be:

 

(1)                                  The Qualified Joint and Survivor Annuity for a Participant who has a spouse.

 

(2)                                  The Normal Form for a Participant who does not have a spouse.

 

(b)                                 Death Benefits. The automatic form of death benefit for a Participant who dies before his Annuity Starting Date shall be:

 

(1)                                  A Qualified Preretirement Survivor Annuity for a Participant who has a spouse to whom he has been continuously married throughout the one-year period ending on the date of his death. The spouse may elect to start receiving the death benefit on any first day of the month on or after the Participant dies and by the date the Participant would have been age 70 1/2. If the spouse dies before benefits start, the Participant’s Vested Account, determined as of the date of the spouse’s death, shall be paid to the spouse’s Beneficiary.

 

(2)                                  A single sum payment to the Participant’s Beneficiary for a Participant who does not have a spouse who is entitled to a Qualified Preretirement Survivor Annuity.

 

Before a death benefit will be paid on account of the death of a Participant who does not have a spouse who is entitled to a Qualified Preretirement Survivor Annuity, it must be established to the satisfaction of a plan representative that the Participant does not have such a spouse.

 

SECTION 6.02—OPTIONAL FORMS OF DISTRIBUTION.

 

(a)                                  Retirement Benefits. The optional forms of retirement benefit shall be the following: (i) a straight life annuity; (ii) single life annuities with certain periods of 5, 10, or 15 years; (iii) a single life  annuity with installment refund; (iv) survivorship life annuities with installment refund and survivorship percentages of 50%, 66 2/3%, 75%, or 100%; (v) fixed period annuities for any period of whole months that is not less than 60; (vi) a fixed period installment option; and (vii) a fixed payment installment option.  A single sum payment is also available.  That portion of a Participant’s Account that is held in the Qualifying Employer Securities Fund may be distributed in kind.

 

The fixed period installment option is an optional form of benefit under which the Participant elects to receive substantially equal annual payments over a fixed period of whole years. The

 

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annual payment may be paid in annual, semi-annual, quarterly, or monthly installments as elected by the Participant. The Participant may elect to receive additional payments.

 

The fixed payment installment option is an optional form of benefit under which the Participant elects to receive a specified dollar amount each year. The annual payment may be paid in annual, semi-annual, quarterly, or monthly installments as elected by the Participant. The Participant may elect to receive additional payments.

 

Under the installment options the amount payable in the Participant’s first Distribution Calendar Year, as defined in the DEFINITIONS SECTION of Article VII, must satisfy the minimum distribution requirements of Article VII for such year. Distributions for later Distribution Calendar Years must satisfy the minimum distribution requirements of Article VII for such years. If the Participant’s Annuity Starting Date does not occur until his second Distribution Calendar Year, the amount payable for such year must satisfy the minimum distribution requirements of Article VII for both the first and second Distribution Calendar Years.

 

Election of an optional form is subject to the qualified election provisions of the ELECTION PROCEDURES SECTION of this article and the distribution requirements of Article VII.

 

Any annuity contract distributed shall be nontransferable.  The terms of any annuity contract purchased and distributed by the Plan to a Participant or spouse shall comply with the requirements of this Plan.

 

(b)                                 Death Benefits. The optional forms of death benefit are a single sum payment and any annuity that is an optional form of retirement benefit.

 

Election of an optional form is subject to the qualified election provisions of the ELECTION PROCEDURES SECTION of this article and the distribution requirements of Article VII.

 

SECTION 6.03—ELECTION PROCEDURES.

 

The Participant, Beneficiary, or spouse shall make any election under this section in writing. The Plan Administrator may require such individual to complete and sign any necessary documents as to the provisions to be made. Any election permitted under (a) and (b) below shall be subject to the qualified election provisions of (c) below.

 

(a)                                  Retirement Benefits. A Participant may elect his Beneficiary or Contingent Annuitant and may elect to have retirement benefits distributed under any of the optional forms of retirement benefit available in the OPTIONAL FORMS OF DISTRIBUTION SECTION of this article.

 

(b)                                 Death Benefits. A Participant may elect his Beneficiary and may elect to have death benefits distributed under any of the optional forms of death benefit available in the OPTIONAL FORMS OF  DISTRIBUTION SECTION of this article.

 

If the Participant has not elected an optional form of distribution for the death benefit payable to his Beneficiary, the Beneficiary may, for his own benefit, elect the form of distribution, in like manner as a Participant.

 

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The Participant may waive the Qualified Preretirement Survivor Annuity by naming someone other than his spouse as Beneficiary.

 

In lieu of the Qualified Preretirement Survivor Annuity described in the AUTOMATIC FORMS OF DISTRIBUTION SECTION of this article, the spouse may, for his own benefit, waive the Qualified Preretirement Survivor Annuity by electing to have the benefit distributed under any of the optional forms of death benefit available in the OPTIONAL FORMS OF DISTRIBUTION SECTION of this article.

 

(c)                                  Qualified Election. The Participant, Beneficiary or spouse may make an election at any time during the election period. The Participant, Beneficiary, or spouse may revoke the election made (or make a new election) at any time and any number of times during the election period. An election is effective only if it meets the consent requirements below.

 

(1)                                  Election Period for Retirement Benefits. Effective as of January 1, 2007, the election period as to retirement benefits is the 180-day period ending on the Annuity Starting Date.  An election to waive the Qualified Joint and Survivor Annuity may not be made before the date the Participant is provided with the notice of the ability to waive the Qualified Joint and Survivor Annuity.

 

(2)                                  Election Period for Death Benefits. A Participant may make an election as to death benefits at any time before he dies. The spouse’s election period begins on the date the Participant dies and ends on the date benefits begin. The Beneficiary’s election period begins on the date the Participant dies and ends on the date benefits begin.

 

An election to waive the Qualified Preretirement Survivor Annuity may not be made by the Participant before the date he is provided with the notice of the ability to waive the Qualified Preretirement Survivor Annuity.  A Participant’s election to waive the Qualified Preretirement Survivor Annuity that is made before the first day of the Plan Year in which he reaches age 35 shall become invalid on such date. An election made by a Participant after he has a Severance from Employment will not become invalid on the first day of the Plan Year in which he reaches age 35 with respect to death benefits from that part of his Account resulting from Contributions made before he had a Severance from Employment.

 

(3)                                  Consent to Election. If the Participant’s Vested Account exceeds $5,000, any benefit that is (i) immediately distributable or (ii) payable in a form other than a Qualified Joint and Survivor Annuity or a Qualified Preretirement Survivor Annuity, requires the consent of the Participant and the Participant’s spouse (or where either the Participant or the spouse has died, the survivor). Such consent shall also be required if the Participant had previously had an Annuity Starting Date with respect to any portion of such Vested Account.

 

The consent of the Participant or spouse to a benefit that is immediately distributable must not be made before the date the Participant or spouse is provided with the notice of the ability to defer the distribution. Such consent shall be in writing.

 

Effective as of January 1, 2007, the consent shall not be made more than 180 days before the Annuity Starting Date. Spousal consent is not required for a benefit that is immediately distributable in a Qualified Joint and Survivor Annuity. Furthermore, if spousal consent is

 

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not required because the Participant is electing an optional form of retirement benefit that is not a life annuity pursuant to (d) below, only the Participant need consent to the distribution of a benefit payable in a form that is not a life annuity and which is immediately distributable. Neither the consent of the Participant nor the Participant’s spouse shall be required to the extent that a distribution is required to satisfy Code Section 401(a)(9) or 415.

 

In addition, upon termination of this Plan, if the Plan does not offer an annuity option (purchased from a commercial provider), and if the Employer (or any entity within the same Controlled Group) does not maintain another defined contribution plan (other than an employee stock ownership plan as defined in Code Section 4975(e)(7)), the Participant’s Account balance will, without the Participant’s consent, be distributed to the Participant. However, if any entity within the same Controlled Group maintains another defined contribution plan (other than an employee stock ownership plan as defined in Code Section 4975(e)(7)) the Participant’s Account will be transferred, without the Participant’s consent, to the other plan if the Participant does not consent to an immediate distribution.

 

A benefit is immediately distributable if any part of the benefit could be distributed to the Participant (or surviving spouse) before the Participant attains (or would have attained if not deceased) the older of Normal Retirement Age or age 62.

 

If the Qualified Joint and Survivor Annuity is waived, the spouse has the right to limit consent only to a specific Beneficiary or a specific form of benefit.  The spouse can relinquish one or both such rights.  Such consent shall be in writing.  Effective as of January 1, 2007, the consent shall not be made more than 180 days before the Annuity Starting Date. If the Qualified Preretirement Survivor Annuity is waived, the spouse has the right to limit consent only to a specific Beneficiary. Such consent shall be in writing. The spouse’s consent shall be witnessed by a plan representative or notary public.  The spouse’s consent must acknowledge the effect of the election, including that the spouse had the right to limit consent only to a specific Beneficiary or a specific form of benefit, if applicable, and that the relinquishment of one or both such rights was voluntary. Unless the consent of the spouse expressly permits designations by the Participant without a requirement of further consent by the spouse, the spouse’s consent must be limited to the form of benefit, if applicable, and the Beneficiary (including any Contingent Annuitant), class of Beneficiaries, or contingent Beneficiary named in the election.

 

Spousal consent is not required, however, if the Participant establishes to the satisfaction of the plan representative that the consent of the spouse cannot be obtained because there is no spouse or the spouse cannot be located. A spouse’s consent under this paragraph shall not be valid with respect to any other spouse.  A Participant may revoke a prior election without the consent of the spouse. Any new election will require a new spousal consent, unless the consent of the spouse expressly permits such election by the Participant without further consent by the spouse. A spouse’s consent may be revoked at any time within the Participant’s election period.

 

(d)                                 Special Rule for Profit Sharing Plans. This subparagraph (d) applies if the Plan is not a direct or indirect transferee after December 31, 1984, of a defined benefit plan, money purchase plan,  target benefit plan, stock bonus plan, or profit sharing plan which is subject to the survivor

 

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annuity requirements of Code Sections 401(a)(11) and 417.  If the above condition is met, spousal consent is not required for electing an optional form of retirement benefit that is not a life annuity. If such condition is not met, such consent requirements shall be operative.

 

SECTION 6.04—NOTICE REQUIREMENTS.

 

(a)                                  Optional Forms of Retirement Benefit and Right to Defer. The Plan Administrator shall furnish to the Participant and the Participant’s spouse a written explanation of the right of the Participant and the Participant’s spouse to defer distribution until the benefit is no longer immediately distributable, including an explanation of the consequences of not deferring the distribution. Such notice shall include a written explanation of the optional forms of retirement benefit in the OPTIONAL FORMS OF DISTRIBUTION SECTION of this article, including a general description of the material features and an explanation of the relative values of these options, in a manner that would satisfy the notice requirements of Code Section 417(a)(3) and section 1.417(a)(3)-1 of the regulations.

 

Effective as of January 1, 2007, the Plan Administrator shall furnish the written explanation by a method reasonably calculated to reach the attention of the Participant and the Participant’s spouse no less than 30 days, and no more than 180 days, before the Annuity Starting Date.

 

The Participant (and spouse, if applicable) may waive the 30-day election period if the distribution of the elected form of retirement benefit begins more than 7 days after the Plan Administrator provides the Participant (and spouse, if applicable) the written explanation provided that: (i) the Participant has been provided with information that clearly indicates that the Participant has at least 30 days to consider the decision of whether or not to elect a distribution and a particular distribution option, (ii) the Participant is permitted to revoke any affirmative distribution election at least until the Annuity Starting Date or, if later, at any time prior to the expiration of the 7-day period that begins the day after the explanation is provided to the Participant, and (iii) the Annuity Starting Date is a date after the date that the written explanation was provided to the Participant.

 

(b)                                 Qualified Joint and Survivor Annuity. The Plan Administrator shall furnish to the Participant a written explanation of the following: the terms and conditions of the Qualified Joint and Survivor Annuity; the Participant’s right to make, and the effect of, an election to waive the Qualified Joint and Survivor Annuity; the rights of the Participant’s spouse; and the right to revoke an election and the effect of such a revocation.

 

Effective as of January 1, 2007, the Plan Administrator shall furnish the written explanation by a method reasonably calculated to reach the attention of the Participant no less than 30 days, and no more than 180 days, before the Annuity Starting Date.

 

The Participant (and spouse, if applicable) may waive the 30-day election period if the distribution of the elected form of retirement benefit begins more than 7 days after the Plan Administrator provides the Participant (and spouse, if applicable) the written explanation provided that: (i) the Participant has been provided with information that clearly indicates that the Participant has at least 30 days to consider whether to waive the Qualified Joint and Survivor Annuity and elect (with spousal consent, if applicable) a form of distribution other than a Qualified Joint and Survivor Annuity, (ii) the Participant is permitted to revoke any affirmative distribution election at least until the Annuity Starting Date or, if later, at any time prior to the expiration of the 7-day

 

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period that begins the day after the explanation of the Qualified Joint and Survivor Annuity is provided to the Participant, and (iii) the Annuity Starting Date is a date after the date that the written explanation was provided to the Participant.

 

After the written explanation is given, a Participant or spouse may make a written request for additional information. The written explanation must be personally delivered or mailed (first class mail, postage prepaid) to the Participant or spouse within 30 days from the date of the written request. The Plan Administrator does not need to comply with more than one such request by a Participant or spouse.

 

The Plan Administrator’s explanation shall be written in nontechnical language and will explain the terms and conditions of the Qualified Joint and Survivor Annuity and the financial effect upon the Participant’s benefit (in terms of dollars per benefit payment) of electing not to have benefits distributed in accordance with the Qualified Joint and Survivor Annuity.

 

(c)                                  Qualified Preretirement Survivor Annuity. The Plan Administrator shall furnish to the Participant a written explanation of the following: the terms and conditions of the Qualified Preretirement Survivor Annuity; the Participant’s right to make, and the effect of, an election to waive the Qualified Preretirement Survivor Annuity; the rights of the Participant’s spouse; and the right to revoke an election and the effect of such a revocation.

 

The Plan Administrator shall furnish the written explanation by a method reasonably calculated to reach the attention of the Participant within the applicable period. The applicable period for a Participant is whichever of the following periods ends last:

 

(1)                                  the period beginning one year before the date the individual becomes a Participant and ending one year after such date; or

 

(2)                                  the period beginning one year before the date the Participant’s spouse is first entitled to a Qualified Preretirement Survivor Annuity and ending one year after such date.

 

If such notice is given before the period beginning with the first day of the Plan Year in which the Participant attains age 32 and ending with the close of the Plan Year preceding the Plan Year in which the Participant attains age 35, an additional notice shall be given within such period. If a Participant has a Severance from Employment before attaining age 35, an additional notice shall be given within the period beginning one year before the date he has a Severance from Employment and ending one year after such date.

 

After the written explanation is given, a Participant or spouse may make a written request for additional information. The written explanation must be personally delivered or mailed (first class mail, postage prepaid) to the Participant or spouse within 30 days from the date of the written request. The Plan Administrator does not need to comply with more than one such request by a Participant or spouse.

 

The Plan Administrator’s explanation shall be written in nontechnical language and will explain the terms and conditions of the Qualified Preretirement Survivor Annuity and the financial effect upon the spouse’s benefit (in terms of dollars per benefit payment) of electing not to have benefits distributed in accordance with the Qualified Preretirement Survivor Annuity.

 

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ARTICLE VII

 

REQUIRED MINIMUM DISTRIBUTIONS

 

SECTION 7.01—APPLICATION.

 

The optional forms of distribution are only those provided in Article VI. An optional form of distribution shall not be permitted unless it meets the requirements of this article. The timing of any distribution must meet the requirements of this article.

 

SECTION 7.02—DEFINITIONS.

 

For purposes of this article, the following terms are defined:

 

Distribution Calendar Year means 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 that 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 (b)(2) of the REQUIRED MINIMUM DISTRIBUTIONS SECTION of this article. 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.

 

5-percent Owner means a Participant who is treated as a 5-percent Owner for purposes of this article. A Participant is treated as a 5-percent Owner for purposes of this article if such Participant is a 5-percent owner as defined in Code Section 416 at any time during the Plan Year ending with or within the calendar year in which such owner attains age 70 1/2.

 

Once distributions have begun to a 5-percent Owner under this article, they must continue to be distributed, even if the Participant ceases to be a 5-percent Owner in a subsequent year.

 

Life Expectancy means life expectancy as computed by use of the Single Life Table in Q&A-1 in section 1.401(a)(9)-9 of the regulations.

 

Participant’s Account Balance means 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 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.

 

Required Beginning Date means, for a Participant who is a 5-percent Owner, April 1 of the calendar year following the calendar year in which he attains age 70 1/2.

 

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Required Beginning Date means, for any Participant who is not a 5-percent Owner, April 1 of the calendar year following the later of the calendar year in which he attains age 70 1/2 or the calendar year in which he retires.

 

The preretirement age 70 1/2 distribution option is only eliminated with respect to Participants who reach age 70 1/2 in or after a calendar year that begins after the later of December 31, 1998, or the adoption date of the amendment which eliminated such option.  The preretirement age 70 1/2 distribution option is an optional form of benefit under which benefits payable in a particular distribution form (including any modifications that may be elected after benefits begin) begin at a time during the period that begins on or after January 1 of the calendar year in which the Participant attains age 70 1/2 and ends April 1 of the immediately following calendar year.

 

The options available for Participants who are not 5-percent Owners and attained age 70 1/2 in calendar years before the calendar year that begins after the later of December 31, 1998, or the adoption date of the amendment which eliminated the preretirement age 70 1/2 distribution option shall be the following. Any such Participant attaining age 70 1/2 in years after 1995 may elect by April 1 of the calendar year following the calendar year in which he attained age 70 1/2 (or by December 31, 1997 in the case of a Participant attaining age 70 1/2 in 1996) to defer distributions until April 1 of the calendar year following the calendar year in which he retires. If no such election is made, the Participant shall begin receiving distributions by April 1 of the calendar year following the year in which he attained age 70 1/2 (or by December 31, 1997 in the case of a Participant attaining age 70 1/2 in 1996). Any such Participant attaining age 70 1/2 in years prior to 1997 may elect to stop distributions that are not purchased annuities and recommence by April 1 of the calendar year following the calendar year in which he retires. To satisfy the joint and survivor annuity requirements described in Article VI, the requirements in Q&A-8 in Notice 97-75 must be satisfied for any Participant who elects to stop distributions, including the requirement that such distributions stop before the end of the Plan’s remedial amendment period under Code Section 401(b) for changes in plan qualification requirements made by the Small Business Job Protection Act of 1996. There shall be a new Annuity Starting Date upon recommencement.

 

SECTION 7.03—REQUIRED MINIMUM DISTRIBUTIONS.

 

(a)                                  General Rules.

 

(1)                                  Subject to the AUTOMATIC FORMS OF DISTRIBUTION SECTION of Article VI, joint and survivor annuity requirements, the requirements of this article shall apply to any distribution of a Participant’s interest and will take precedence over any inconsistent provisions of this Plan. Unless otherwise specified, the provisions of this article apply to calendar years beginning after December 31, 2002.

 

(2)                                  All distributions required under this article shall be determined and made in accordance with the regulations under Code Section 401(a)(9), including the incidental death benefit requirement in Code Section 401(a)(9)(G), and the regulations thereunder.

 

(b)                                 Time and Manner of Distribution.

 

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

 

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(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:

 

(i)                                     If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary, then 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 70 1/2, if later, except to the extent that an election is made to receive distributions in accordance with the 5-year rule under (e) below. Under the 5-year rule, the Participant’s entire interest will be distributed to the Designated Beneficiary by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.

 

(ii)                                  If the Participant’s surviving spouse is not the Participant’s sole Designated Beneficiary, then distributions to the Designated Beneficiary will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died, except to the extent that an election is made to receive distributions in accordance with the 5-year rule under (e) below. Under the 5-year rule, the Participant’s entire interest will be distributed to the Designated Beneficiary by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.

 

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

 

(iv)                              If the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary and the surviving spouse dies after the Participant but before distributions to the surviving spouse are required to begin, this (b)(2), other than (b)(2)(i), will apply as if the surviving spouse were the Participant.

 

For purposes of this (b)(2) and (d) below, unless (b)(2)(iv) above applies, distributions are considered to begin on the Participant’s Required Beginning Date.  If (b)(2)(iv) above applies, distributions are considered to begin on the date distributions are required to begin to the surviving spouse under (b)(2)(i) above. 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 (b)(2)(i) above), the date distributions are considered to begin is the date distributions actually commence.

 

(3)                                  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 (c) and (d) below. If the Participant’s interest is distributed in the form of an annuity purchased from an insurance company, distributions thereunder will be made in

 

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accordance with the requirements of Code Section 401(a)(9) and the regulations thereunder.

 

(c)                                  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:

 

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

 

(ii)                                  if the Participant’s sole Designated Beneficiary for the Distribution Calendar Year is the Participant’s spouse, the quotient obtained by dividing the Participant’s Account Balance by the number in the Joint and Last Survivor Table set forth in Q&A-3 in section 1.401(a)(9)-9 of the regulations, 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 (c) beginning with the first Distribution Calendar Year and continuing up to, and including, the Distribution Calendar Year that includes the Participant’s date of death.

 

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

 

(1)                                  Death On or After Date Distributions Begin.

 

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

 

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

 

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

 

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birthday in the calendar year of the spouse’s death, reduced by one for each subsequent calendar year.

 

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

 

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

 

(2)                                  Death Before Date Distributions Begin.

 

(i)                                     Participant Survived by Designated Beneficiary. If the Participant dies before the date distributions begin and there is a Designated Beneficiary, the 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 (d)(1) above, except to the extent that an election is made to receive distributions in accordance with the 5-year rule under (e) below. Under the 5-year rule, the Participant’s entire interest will be distributed to the Designated Beneficiary by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.

 

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

 

(iii)                               Death of Surviving Spouse Before Distributions to Surviving Spouse Are Required to Begin. If the Participant dies before the date distributions begin, the Participant’s surviving spouse is the Participant’s sole Designated Beneficiary, and the surviving spouse dies before distributions are required to begin to the surviving spouse under (b)(2)(i) above, this (d)(2) will apply as if the surviving spouse were the Participant.

 

(e)                                  Election of 5-year Rule. Participants or Beneficiaries may elect on an individual basis whether the 5-year rule in (b)(2) and (d)(2) above applies to distributions after the death of a Participant who has a Designated Beneficiary.  The election must be made no later than the earlier of September 30 of the calendar year in which the distribution would be required to begin under (b)(2) above if no such election is made, or by September 30 of the calendar year which contains the fifth anniversary of the Participant’s (or, if applicable, surviving spouse’s) death.

 

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SECTION 7.04—TRANSITION RULES.

 

To the extent the Plan was effective before 2003, required minimum distributions were made pursuant to (a) and (b) below:

 

(a)                                  2000 and Before. Required minimum distributions for calendar years after 1984 and before 2001 were made in accordance with Code Section 401(a)(9) and the proposed regulations thereunder published in the Federal Register on July 27, 1987 (the 1987 Proposed Regulations).

 

(b)                                 2001 and 2002. Required minimum distributions for calendar years 2001 and 2002 were made pursuant to the proposed regulations under Code Section 401(a)(9) published in the Federal Register on January 17, 2001 (the 2001 Proposed Regulations). Distributions were made in 2001 under the 1987 Proposed Regulations prior to June 14, 2001, and the special transition rule in Announcement 2001-82, 2001-2 C.B. 123, applied.

 

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ARTICLE VIII

 

TERMINATION OF THE PLAN

 

The Employer expects to continue the Plan indefinitely but reserves the right to terminate the Plan in whole or in part at any time upon giving written notice to all parties concerned. Complete discontinuance of Contributions constitutes complete termination of the Plan.

 

The Account of each Participant shall be 100% vested and nonforfeitable as of the effective date of complete termination of the Plan. The Account of each Participant who is included in the group of Participants deemed to be affected by the partial termination of the Plan shall be 100% vested and nonforfeitable as of the effective date of the partial termination of the Plan.  The Participant’s Vested Account shall continue to participate in the earnings credited, expenses charged, and any appreciation or depreciation of the Investment Fund until his Vested Account is distributed.

 

A Participant’s Vested Account that does not result from the Contributions listed below may be distributed to the Participant after the effective date of the complete termination of the Plan:

 

Elective Deferral Contributions

Qualified Nonelective Contributions

 

A Participant’s Vested Account resulting from such Contributions may be distributed upon complete termination of the Plan, but only if neither the Employer nor any Controlled Group member maintain another defined contribution plan (other than an employee stock ownership plan as defined in Code Section 4975(e)(7) or 409(a), a simplified employee pension plan as defined in Code Section 408(k), a SIMPLE IRA plan as defined in Code Section 408(p), a plan or contract that satisfies the requirements of Code Section 403(b), or a plan described in Code Section 457(b) or (f)) at any time during the period beginning on the date of complete termination of the Plan and ending 12 months after all assets have been distributed from the Plan.  Such distribution is made in a lump sum. A distribution under this article shall be a retirement benefit and shall be distributed to the Participant according to the provisions of Article VI. However, the fixed period and fixed payment installment options shall not be available.

 

If a Participant or Beneficiary is receiving payments under the fixed period or fixed payment installment option, the Vested Account shall be paid to such person in a single sum.

 

The Participant’s entire Vested Account shall be paid in a single sum to the Participant as of the effective date of complete termination of the Plan if (i) the requirements for distribution of Elective Deferral Contributions in the above paragraph are met and (ii) consent of the Participant is not required in the ELECTION PROCEDURES SECTION of Article VI to distribute a benefit that is immediately distributable. This is a small amounts payment. The small amounts payment is in full settlement of all benefits otherwise payable.

 

Upon complete termination of the Plan, no more Employees shall become Participants and no more Contributions shall be made.

 

The assets of this Plan shall not be paid to the Employer at any time, except that, after the satisfaction of all liabilities under the Plan, any assets remaining may be paid to the Employer. The payment may not be made if it would contravene any provision of law.

 

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ARTICLE IX

 

ADMINISTRATION OF THE PLAN

 

SECTION 9.01—ADMINISTRATION.

 

Subject to the provisions of this article, the Plan Administrator has complete control of the administration of the Plan. The Plan Administrator has all the powers necessary for it to properly carry out its administrative duties.  Not in limitation, but in amplification of the foregoing, the Plan Administrator has complete discretion to construe or interpret the provisions of the Plan, including ambiguous provisions, if any, and to determine all questions that may arise under the Plan, including all questions relating to the eligibility of Employees to participate in the Plan and the amount of benefit to which any Participant, Beneficiary, spouse, or Contingent Annuitant may become entitled. The Plan Administrator’s decisions upon all matters within the scope of its authority shall be final.

 

Unless otherwise set out in the Plan or Annuity Contract, the Plan Administrator may delegate recordkeeping and other duties which are necessary to assist it with the administration of the Plan to any person or firm which agrees to accept such duties. The Plan Administrator shall be entitled to rely upon all tables, valuations, certificates and reports furnished by the consultant or actuary appointed by the Plan Administrator and upon all opinions given by any counsel selected or approved by the Plan Administrator.

 

The Plan Administrator shall receive all claims for benefits by Participants, former Participants, Beneficiaries, spouses, and Contingent Annuitants. The Plan Administrator shall determine all facts necessary to establish the right of any Claimant to benefits and the amount of those benefits under the provisions of the Plan. The Plan Administrator may establish rules and procedures to be followed by Claimants in filing claims for benefits, in furnishing and verifying proofs necessary to determine age, and in any other matters required to administer the Plan.

 

SECTION 9.02—EXPENSES.

 

Expenses of the Plan, to the extent that the Employer does not pay such expenses, may be paid out of the assets of the Plan provided that such payment is consistent with ERISA. Such expenses include, but are not limited to, expenses for bonding required by ERISA; expenses for recordkeeping and other administrative services; fees and expenses of the Trustee or Annuity Contract; expenses for investment education service; and direct costs that the Employer incurs with respect to the Plan. Expenses that relate solely to a specific Participant or Alternate Payee may be assessed against such Participant or Alternate Payee as provided in the service and expense agreement or such other documents duly entered into by or with regard to the Plan that govern such matters.

 

SECTION 9.03—RECORDS.

 

All acts and determinations of the Plan Administrator shall be duly recorded. All these records, together with other documents necessary for the administration of the Plan, shall be preserved in the Plan Administrator’s custody.

 

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Writing (handwriting, typing, printing), photostating, photographing, microfilming, magnetic impulse, mechanical or electrical recording, or other forms of data compilation shall be acceptable means of keeping records.

 

SECTION 9.04—INFORMATION AVAILABLE.

 

Any Participant in the Plan or any Beneficiary may examine copies of the Plan description, latest annual report, any bargaining agreement, this Plan, the Annuity Contract, or any other instrument under which the Plan was established or is operated. The Plan Administrator shall maintain all of the items listed in this section in its office, or in such other place or places as it may designate in order to comply with governmental regulations. These items may be examined during reasonable business hours. Upon the written request of a Participant or Beneficiary receiving benefits under the Plan, the Plan Administrator shall furnish him with a copy of any of these items. The Plan Administrator may make a reasonable charge to the requesting person for the copy.

 

SECTION 9.05—CLAIM PROCEDURES.

 

A Claimant must submit any necessary forms and needed information when making a claim for benefits under the Plan.

 

If a claim for benefits under the Plan is wholly or partially denied, the Plan Administrator shall provide adequate written notice to the Claimant whose claim for benefits under the Plan has been denied. The notice must be furnished within 90 days of the date that the claim is received by the Plan without regard to whether all of the information necessary to make a benefit determination is received. The Claimant shall be notified in writing within this initial 90-day period if special circumstances require an extension of the time needed to process the claim. The notice shall indicate the special circumstances requiring an extension of time and the date by which the Plan Administrator’s decision is expected to be rendered. In no event shall such extension exceed a period of 90 days from the end of the initial 90-day period.

 

The Plan Administrator’s notice to the Claimant shall: (i) specify the reason or reasons for the denial; (ii) reference the specific Plan provisions on which the denial is based; (iii) describe any additional material and information needed for the Claimant to perfect his claim for benefits; (iv) explain why the material and information is needed; and (v) inform the Claimant of the Plan’s appeal procedures and the time limits applicable to such procedures, including a statement of the Claimant’s right to bring a civil action under ERISA section 502(a) following an adverse benefit determination on appeal.

 

Any appeal made by a Claimant must be made in writing to the Plan Administrator within 60 days after receipt of the Plan Administrator’s notice of denial of benefits. If the Claimant appeals to the Plan Administrator, the Claimant may submit written comments, documents, records, and other information relating to the claim for benefits. The Claimant shall be provided, 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. The Plan Administrator shall review the claim taking into account all comments, documents, records, and other information submitted by the Claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

 

The Plan Administrator shall provide adequate written notice to the Claimant of the Plan’s benefit determination on review. The notice must be furnished within 60 days of the date that the request for review

 

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is received by the Plan without regard to whether all of the information necessary to make a benefit determination on review is received. The Claimant shall be notified in writing within this initial 60-day period if special circumstances require an extension of the time needed to process the claim. The notice shall indicate the special circumstances requiring an extension of time and the date by which the Plan Administrator expects to render the determination on review. In no event shall such extension exceed a period of 60 days from the end of the initial 60-day period.

 

In the event the benefit determination is being made by a committee or board of trustees that hold regularly scheduled meetings at least quarterly, the above paragraph shall not apply. The benefit determination must be made by the date of the meeting of the committee or board that immediately follows the Plan’s receipt of a request for review, unless the request for review is filed within 30 days preceding the date of such meeting. In such case, the benefit determination must be made by the date of the second meeting following the Plan’s receipt of the request for review.  The date of the receipt of the request for review shall be determined without regard to whether all of the information necessary to make a benefit determination on review is received. The Claimant shall be notified in writing within this initial period if special circumstances require an extension of the time needed to process the claim.  The notice shall indicate the special circumstances requiring an extension of time and the date by which the committee or board expects to render the determination on review. In no event shall such benefit determination be made later than the third meeting of the committee or board following the Plan’s receipt of the request for review. The Plan Administrator shall provide adequate written notice to the Claimant of the Plan’s benefit determination on review as soon as possible, but not later than five days after the benefit determination is made.

 

If the claim for benefits is wholly or partially denied on review, the Plan Administrator’s notice to the Claimant shall: (i) specify the reason or reasons for the denial; (ii) reference the specific Plan provisions on which the denial is based; (iii) include a statement 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; and (iv) include a statement of the Claimant’s right to bring a civil action under ERISA section 502(a).

 

A Claimant may authorize a representative to act on the Claimant’s behalf with respect to a benefit claim or appeal of an adverse benefit determination. Such authorization shall be made by completion of a form furnished for that purpose. In the absence of any contrary direction from the Claimant, all information and notifications to which the Claimant is entitled shall be directed to the authorized representative.

 

The Plan Administrator shall perform periodic examinations, reviews, or audits of benefit claims to determine whether claims determinations are made in accordance with the governing Plan documents and, where appropriate, Plan provisions have been consistently applied with respect to similarly situated Claimants.

 

SECTION 9.06—DELEGATION OF AUTHORITY.

 

All or any part of the administrative duties and responsibilities under this article may be delegated by the Plan Administrator to a retirement committee. The duties and responsibilities of the retirement committee shall be set out in a separate written agreement.

 

SECTION 9.07—EXERCISE OF DISCRETIONARY AUTHORITY.

 

The Employer, Plan Administrator, and any other person or entity who has authority with respect to the management, administration, or investment of the Plan may exercise that authority in its/his full discretion,

 

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subject only to the duties imposed under ERISA. This discretionary authority includes, but is not limited to, the authority to make any and all factual determinations and interpret all terms and provisions of the Plan documents relevant to the issue under consideration.  The exercise of authority will be binding upon all persons; will be given deference in all courts of law to the greatest extent allowed under law; and will not be overturned or set aside by any court of law unless found to be arbitrary and capricious or made in bad faith.

 

SECTION 9.08—TRANSACTION PROCESSING.

 

Transactions (including, but not limited to, investment directions, trades, loans, and distributions) shall be processed as soon as administratively practicable after proper directions are received from the Participant or other parties. No guarantee is made by the Plan, Plan Administrator, Trustee, Insurer, or Employer that such transactions will be processed on a daily or other basis, and no guarantee is made in any respect regarding the processing time of such transactions.

 

Notwithstanding any other provision of the Plan, the Employer, the Plan Administrator, or the Trustee reserves the right to not value an investment option on any given Valuation Date for any reason deemed appropriate by the Employer, the Plan Administrator, or the Trustee.

 

Administrative practicality will be determined by legitimate business factors (including, but not limited to, failure of systems or computer programs, failure of the means of the transmission of data, force majeure, the failure of a service provider to timely receive values or prices, and correction for errors or omissions or the errors or omissions of any service provider) and in no event will be deemed to be less than 14 days. The processing date of a transaction shall be binding for all purposes of the Plan and considered the applicable Valuation Date for any transaction.

 

SECTION 9.09—VOTING AND TENDER OF QUALIFYING EMPLOYER SECURITIES.

 

Voting rights with respect to Qualifying Employer Securities will be passed through to Participants. Participants will be allowed to direct the voting rights of Qualifying Employer Securities for any matter put to the vote of shareholders. Before each meeting of shareholders, the Employer shall cause to be sent to each person with power to control such voting rights a copy of any notice and any other information provided to shareholders and, if applicable, a form for instructing the Trustee how to vote at such meeting (or any adjournment thereof) the number of full and fractional shares subject to such person’s voting control. The Trustee may establish a deadline in advance of the meeting by which such forms must be received in order to be effective.

 

Each Participant shall be entitled to one vote for each share credited to his Account.

 

If some or all of the Participants have not directed or have not timely directed the Trustee on how to vote, then the Trustee shall vote such Qualifying Employer Securities in the same proportion as those shares of Qualifying Employer Securities for which the Trustee has received proper direction for such matter.

 

Tender rights or exchange offers for Qualifying Employer Securities will be passed through to Participants. As soon as practicable after the commencement of a tender or exchange offer for Qualifying Employer Securities, the Employer shall cause each person with power to control the response to such tender or exchange offer to be advised in writing the terms of the offer and, if applicable, to be provided with a form for instructing the Trustee, or for revoking such instruction, to tender or exchange shares of Qualifying

 

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Employer Securities, to the extent permitted under the terms of such offer. In advising such persons of the terms of the offer, the Employer may include statements from the board of directors setting forth its position with respect to the offer.

 

If some or all of the Participants have not directed or have not timely directed the Trustee on how to tender, then the Trustee shall tender such Qualifying Employer Securities in the same proportion as those shares of Qualifying Employer Securities for which the Trustee has received proper direction for such matter.

 

If the tender or exchange offer is limited so that all of the shares that the Trustee has been directed to tender or exchange cannot be sold or exchanged, the shares that each Participant directed to be tendered or exchanged shall be deemed to have been sold or exchanged in the same ratio that the number of shares actually sold or exchanged bears to the total number of shares that the Trustee was directed to tender or exchange.

 

The Trustee shall hold the Participant’s individual directions with respect to voting rights or tender decisions in confidence and, except as required by law, shall not divulge or release such individual directions to anyone associated with the Employer. The Employer may require verification of the Trustee’s compliance with the directions received from Participants by any independent auditor selected by the Employer, provided that such auditor agrees to maintain the confidentiality of such individual directions.

 

The Employer may develop procedures to facilitate the exercise of votes or tender rights, such as the use of facsimile transmissions for the Participants located in physically remote areas.

 

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ARTICLE X

 

GENERAL PROVISIONS

 

SECTION 10.01—AMENDMENTS.

 

The Employer may amend this Plan at any time, including any remedial retroactive changes (within the time specified by Internal Revenue Service regulations), to comply with any law or regulation issued by any governmental agency to which the Plan is subject.  The Employer may correct obvious and unambiguous typographical errors and cross references that merely correct a reference but that do not in any way change the original intended meaning of the provisions.

 

An amendment may not allow reversion or diversion of Plan assets to the Employer at any time, except as may be required to comply with any law or regulation issued by any governmental agency to which the Plan is subject.

 

An amendment may not eliminate or reduce a section 411(d)(6) protected benefit, as defined in Q&A-1 in section 1.411(d)-4 of the regulations, that has already accrued, except as provided in section 1.411(d)-3 or 1.411(d)-4 of the regulations. This is generally the case even if such elimination or reduction is contingent upon the Employee’s consent. However, the Plan may be amended to eliminate or reduce section 411(d)(6) protected benefits with respect to benefits not yet accrued as of the later of the amendment’s adoption date or effective date without violating Code Section 411(d)(6).  Notwithstanding the preceding sentences, a Participant’s Account may be reduced to the extent permitted under Code Section 412(d)(2).

 

If, as a result of an amendment, an Employer Contribution is removed that is not 100% immediately vested when made, the applicable vesting schedule shall remain in effect with respect to that part of his Account resulting from such Contributions after the date of such amendment.  The Participant shall not become immediately 100% vested in such Contributions as a result of the elimination of such Contribution except as otherwise specifically provided in the Plan.

 

An amendment shall not decrease a Participant’s vested interest in the Plan. If an amendment to the Plan changes the computation of the percentage used to determine that portion of a Participant’s Account attributable to Employer Contributions which is nonforfeitable (whether directly or indirectly), in the case of an Employee who is a Participant as of the later of the date such amendment or change is adopted or the date it becomes effective, the nonforfeitable percentage (determined as of such date) of such Employee’s right to his Account attributable to Employer Contributions shall not be less than the percentage computed under the Plan without regard to such amendment or change. Furthermore, each Participant or former Participant

 

(a)                                  who has completed at least three Years of Service on the date the election period described below ends (five Years of Service if the Participant does not have at least one Hour of Service in a Plan Year beginning after December 31, 1988) and

 

(b)                                 whose nonforfeitable percentage will be determined on any date after the date of the change

 

may elect, during the election period, to have the nonforfeitable percentage of his Account that results from Employer Contributions determined without regard to the amendment. This election may not be revoked. If after the Plan is changed, the Participant’s nonforfeitable percentage will at all times be as great as it would

 

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have been if the change had not been made, no election needs to be provided. The election period shall begin no later than the date the Plan amendment is adopted and end no earlier than the 60th day after the latest of the date the amendment is adopted or becomes effective, or the date the Participant is issued written notice of the amendment by the Employer or the Plan Administrator.

 

For an amendment adopted after August 9, 2006, with respect to a Participant’s Account attributable to Employer Contributions accrued as of the later of the adoption or effective date of the amendment and earnings, the vested percentage of each Participant will be the greater of the vested percentage under the old vesting schedule or the vested percentage under the new vesting schedule.

 

SECTION 10.02—DIRECT ROLLOVERS.

 

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 Plan Administrator, to have any portion of an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan specified by the Distributee in a Direct Rollover. Effective as of January 1, 2007, for distributions made after December 31, 2006, a Designated Beneficiary of a Participant who is not the surviving spouse of the Participant may elect, at the time and in the manner prescribed by the Plan Administrator, to have any portion of a distribution, that would be an Eligible Rollover Distribution if the Designated Beneficiary were a Distributee, paid in a Direct Rollover to an individual retirement plan described in Code Section 402(c)(8)(B)(i) or (ii) established for the purposes of receiving the distribution on behalf of the Designated Beneficiary. If such Direct Rollover is made: (i) such Direct Rollover shall be treated as an Eligible Rollover Distribution; (ii) the individual retirement plan shall be treated as an inherited individual retirement account or individual retirement annuity (within the meaning of Code Section 408(d)(3)(C)); and (iii) Code Section 401(a)(9)(B) (other than clause (iv) thereof) shall apply to such plan. For this purpose, certain trusts shall be treated as a Designated Beneficiary as provided in Code Section 402(c)(11)(B).

 

In the event of a mandatory distribution of an Eligible Rollover Distribution greater than $1,000 in accordance with the SMALL AMOUNTS SECTION of this article (or which is a small amounts payment under Article VIII at complete termination of the Plan), if the Participant does not elect to have such distribution paid directly to an Eligible Retirement Plan specified by the Participant in a Direct Rollover or to receive the distribution directly, the Plan Administrator will pay the distribution in a Direct Rollover to an individual retirement plan designated by the Plan Administrator.

 

In the event of any other Eligible Rollover Distribution to a Distributee in accordance with the SMALL AMOUNTS SECTION of this article (or which is a small amounts payment under Article VIII at complete termination of the Plan), if the Distributee does not elect to have such distribution paid directly to an Eligible Retirement Plan specified by the Distributee in a Direct Rollover or to receive the distribution directly, the Plan Administrator will pay the distribution to the Distributee.

 

A mandatory distribution is a distribution to a Participant that is made without the Participant’s consent and is made to the Participant before he attains the older of age 62 or his Normal Retirement Age.

 

SECTION 10.03—MERGERS AND DIRECT TRANSFERS.

 

The Plan may not be merged or consolidated with, nor have its assets or liabilities transferred to, any other retirement plan, unless each Participant in this Plan would (if that plan then terminated) receive a benefit

 

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immediately after the merger, consolidation, or transfer that is equal to or greater than the benefit the Participant would have been entitled to receive immediately before the merger, consolidation, or transfer (if this Plan had then terminated).  The Employer may enter into merger agreements or direct transfer of assets agreements with the employers under other retirement plans which are qualifiable under Code Section 401(a), including an elective transfer, and may accept the direct transfer of plan assets, or may transfer plan assets, as a party to any such agreement. The Employer shall not consent to, or be a party to a merger, consolidation, or transfer of assets with a defined benefit plan if such action would result in a defined benefit feature being maintained under this Plan.  The Employer will not transfer any amounts attributable to elective deferral contributions, qualified matching contributions, and qualified nonelective contributions unless the transferee plan provides that the limitations of section 1.401(k)-1(d) of the regulations shall apply to such amounts (including post-transfer earnings thereon), unless the amounts could have been distributed at the time of the transfer (other than for hardship), and the transfer is an elective transfer described in Q&A-3(b)(1) in section 1.411(d)-4 of the regulations.

 

Notwithstanding any provision of the Plan to the contrary, to the extent any optional form of benefit under the Plan permits a distribution prior to the Employee’s retirement, death, disability, or Severance from Employment, and prior to plan termination, the optional form of benefit is not available with respect to benefits attributable to assets (including the post-transfer earnings thereon) and liabilities that are transferred, within the meaning of Code Section 414(l), to this Plan from a money purchase pension plan qualified under Code Section 401(a) (other than any portion of those assets and liabilities attributable to voluntary employee contributions). The limitations of section 1.401(k)-1(d) of the regulations applicable to elective deferral contributions, qualified matching contributions, and qualified nonelective contributions shall continue to apply to any amounts attributable to such contributions (including post-transfer earnings thereon) transferred to this Plan, unless the amounts could have been distributed at the time of the transfer (other than for hardship), and the transfer is an elective transfer described in Q&A-3(b)(1) in section 1.411(d)-4 of the regulations.

 

The Plan may accept a direct transfer of plan assets on behalf of an Eligible Employee. If the Eligible Employee is not an Active Participant when the transfer is made, the Eligible Employee shall be deemed to be an Active Participant only for the purpose of investment and distribution of the transferred assets. Employer Contributions shall not be made for or allocated to the Eligible Employee, until the time he meets all of the requirements to become an Active Participant.

 

The Plan shall hold, administer, and distribute the transferred assets as a part of the Plan. The Plan shall maintain a separate account for the benefit of the Employee on whose behalf the Plan accepted the transfer in order to reflect the value of the transferred assets.

 

A Participant’s section 411(d)(6) protected benefits, as defined in Q&A-1 in section 1.411(d)-4 of the regulations, may not be eliminated by reason of transfer or any transaction amending or having the effect of amending a plan or plans to transfer benefits except as provided below.

 

A Participant’s section 411(d)(6) protected benefits may be eliminated or reduced upon transfer between qualified defined contribution plans if the conditions in Q&A-3(b)(1) in section 1.411(d)-4 of the regulations are met. The transfer must meet all of the other applicable qualification requirements.

 

A Participant’s section 411(d)(6) protected benefits may be eliminated or reduced if a transfer is an elective transfer of certain distributable benefits between qualified plans (both defined benefit and defined contribution) and the conditions in Q&A-3(c)(1) in section 1.411(d)-4 of the regulations are met. The rules applicable to distributions under the plan would apply to the transfer, but the transfer would not be treated as a

 

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distribution for purposes of the minimum distribution requirements of Code Section 401(a)(9).  Beginning January 1, 2002, if the Participant is eligible to receive an immediate distribution of his entire nonforfeitable accrued benefit in a single sum distribution that would consist entirely of an eligible rollover distribution under Code Section 401(a)(31), such transfer will be accomplished as a direct rollover under Code Section 401(a)(31).

 

SECTION 10.04—PROVISIONS RELATING TO THE INSURER AND OTHER PARTIES.

 

The obligations of an Insurer shall be governed solely by the provisions of the Annuity Contract. The Insurer shall not be required to perform any act not provided in or contrary to the provisions of the Annuity Contract.  Each Annuity Contract when purchased shall comply with the Plan.  See the CONSTRUCTION SECTION of this article.

 

Any issuer or distributor of investment contracts or securities is governed solely by the terms of its policies, written investment contract, prospectuses, security instruments, and any other written agreements entered into with the Trustee with regard to such investment contracts or securities.

 

Such Insurer, issuer or distributor is not a party to the Plan, nor bound in any way by the Plan provisions. Such parties shall not be required to look to the terms of this Plan, nor to determine whether the Employer, the Plan Administrator, the Trustee, or the Named Fiduciary have the authority to act in any particular manner or to make any contract or agreement.

 

Until notice of any amendment or termination of this Plan or a change in Trustee has been received by the Insurer at its home office or an issuer or distributor at their principal address, they are and shall be fully protected in assuming that the Plan has not been amended or terminated and in dealing with any party acting as Trustee according to the latest information which they have received at their home office or principal address.

 

SECTION 10.05—EMPLOYMENT STATUS.

 

Nothing contained in this Plan gives an Employee the right to be retained in the Employer’s employ or to interfere with the Employer’s right to discharge any Employee.

 

SECTION 10.06—RIGHTS TO PLAN ASSETS.

 

An Employee shall not have any right to or interest in any assets of the Plan upon termination of employment or otherwise except as specifically provided under this Plan, and then only to the extent of the benefits payable to such Employee according to the Plan provisions.

 

Any final payment or distribution to a Participant or his legal representative or to any Beneficiaries, spouse, or Contingent Annuitant of such Participant under the Plan provisions shall be in full satisfaction of all claims against the Plan, the Named Fiduciary, the Plan Administrator, the Insurer, the Trustee, and the Employer arising under or by virtue of the Plan.

 

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SECTION 10.07—BENEFICIARY.

 

Each Participant may name a Beneficiary to receive any death benefit (other than any income payable to a Contingent Annuitant) that may arise out of his participation in the Plan. The Participant may change his Beneficiary from time to time. Unless a qualified election has been made, for purposes of distributing any death benefits before the Participant’s Retirement Date, the Beneficiary of a Participant who has a spouse who is entitled to a Qualified Preretirement Survivor Annuity shall be the Participant’s spouse. The Participant’s Beneficiary designation and any change of Beneficiary shall be subject to the provisions of the ELECTION PROCEDURES SECTION of Article VI.

 

It is the responsibility of the Participant to give written notice to the Plan Administrator of the name of the Beneficiary on a form furnished for that purpose.  The Plan Administrator shall maintain records of Beneficiary designations for Participants before their Retirement Dates. However, the Plan Administrator may delegate to another party the responsibility of maintaining records of Beneficiary designations. In that event, the written designations made by Participants shall be filed with such other party. If a party other than the Insurer maintains the records of Beneficiary designations and a Participant dies before his Retirement Date, such other party shall certify to the Insurer the Beneficiary designation on its records for the Participant.

 

If there is no Beneficiary named or surviving when a Participant dies, the Participant’s Beneficiary shall be the Participant’s surviving spouse, or where there is no surviving spouse, the executor or administrator of the Participant’s estate.

 

SECTION 10.08—NONALIENATION OF BENEFITS.

 

Benefits payable under the Plan are not subject to the claims of any creditor of any Participant, Beneficiary, spouse, or Contingent Annuitant. A Participant, Beneficiary, spouse, or Contingent Annuitant does not have any rights to alienate, anticipate, commute, pledge, encumber, or assign such benefits, except in the case of a loan as provided in the LOANS TO PARTICIPANTS SECTION of Article V. The preceding sentences shall also apply to the creation, assignment, or recognition of a right to any benefit payable with respect to a Participant according to a domestic relations order, unless such order is determined by the Plan Administrator to be a qualified domestic relations order, as defined in Code Section 414(p), or any domestic relations order entered before January 1, 1985.  The preceding sentences shall not apply to any offset of a Participant’s benefits provided under the Plan against an amount the Participant is required to pay the Plan with respect to a judgment, order, or decree issued, or a settlement entered into, on or after August 5, 1997, which meets the requirements of Code Sections 401(a)(13)(C) or (D).

 

SECTION 10.09—CONSTRUCTION.

 

The validity of the Plan or any of its provisions is determined under and construed according to Federal law and, to the extent permissible, according to the laws of the state in which the Employer has its principal office. In case any provision of this Plan is held illegal or invalid for any reason, such determination shall not affect the remaining provisions of this Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision had never been included.

 

In the event of any conflict between the provisions of the Plan and the terms of any Annuity Contract issued hereunder, the provisions of the Plan control.

 

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SECTION 10.10—LEGAL ACTIONS.

 

No person employed by the Employer; no Participant, former Participant, or their Beneficiaries; nor any other person having or claiming to have an interest in the Plan is entitled to any notice of process. A final judgment entered in any such action or proceeding shall be binding and conclusive on all persons having or claiming to have an interest in the Plan.

 

SECTION 10.11—SMALL AMOUNTS.

 

If consent of the Participant is not required for a benefit that is immediately distributable in the ELECTION PROCEDURES SECTION of Article VI, a Participant’s entire Vested Account shall be paid in a single sum as of the earliest of his Retirement Date, the date he dies, or the date he has a Severance from Employment for any other reason (the date the Employer provides notice to the record keeper of the Plan of such event, if later). For purposes of this section, if the Participant’s Vested Account is zero, the Participant shall be deemed to have received a distribution of such Vested Account. This is a small amounts payment.

 

If a small amounts payment is made as of the date the Participant dies, the small amounts payment shall be made to the Participant’s Beneficiary (spouse if the death benefit is payable to the spouse). If a small amounts payment is made while the Participant is living, the small amounts payment shall be made to the Participant. The small amounts payment is in full settlement of all benefits otherwise payable.

 

No other small amounts payments shall be made.

 

SECTION 10.12—WORD USAGE.

 

The masculine gender, where used in this Plan, shall include the feminine gender and the singular words, where used in this Plan, shall include the plural, unless the context indicates otherwise.

 

The words “in writing” and “written,” where used in this Plan, shall include any other forms, such as voice response or other electronic system, as permitted by any governmental agency to which the Plan is subject.

 

SECTION 10.13—CHANGE IN SERVICE METHOD.

 

(a)                                  Change of Service Method Under This Plan. If this Plan is amended to change the method of crediting service from the elapsed time method to the hours method for any purpose under this Plan, the Employee’s service shall be equal to the sum of (1), (2), and (3) below:

 

(1)                                  The number of whole years of service credited to the Employee under the Plan as of the date the change is effective.

 

(2)                                  One year of service for the computation period in which the change is effective if he is credited with the required number of Hours of Service. For that portion of the computation period ending on the date of the change (for the first day of the computation period if the change is made on the first day of the computation period), the Employee will be credited with the greater of (i) his actual Hours of Service or (ii) the number of Hours of Service that is equivalent to the fractional part of a year of elapsed time service credited as of the date

 

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of the change, if any. In determining the equivalent Hours of Service, the Employee shall be credited with 190 Hours of Service for each month and any fractional part of a month in such fractional part of a year. The number of months and any fractional part of a month shall be determined by multiplying the fractional part of a year, expressed as a decimal, by 12. For the remaining portion of the computation period (the period beginning on the second day of the computation period and ending on the last day of the computation period if the change is made on the first day of the computation period), the Employee will be credited with his actual Hours of Service.

 

(3)                                  The Employee’s service determined under this Plan using the hours method after the end of the computation period in which the change in service method was effective.

 

If this Plan is amended to change the method of crediting service from the hours method to the elapsed time method for any purpose under this Plan, the Employee’s service shall be equal to the sum of (4), (5), and (6) below:

 

(4)                                  The number of whole years of service credited to the Employee under the Plan as of the beginning of the computation period in which the change in service method is effective.

 

(5)                                  The greater of (i) the service that would be credited to the Employee for that entire computation period using the elapsed time method or (ii) the service credited to him under the Plan as of the date the change is effective.

 

(6)                                  The Employee’s service determined under this Plan using the elapsed time method after the end of the applicable computation period in which the change in service method was effective.

 

(b)                                 Transfers Between Plans with Different Service Methods. If an Employee has been a participant in another plan of the Employer that credited service under the elapsed time method for any purpose that under this Plan is determined using the hours method, then the Employee’s service shall be equal to the sum of (1), (2), and (3) below:

 

(1)                                  The number of whole years of service credited to the Employee under the other plan as of the date he became an Eligible Employee under this Plan.

 

(2)                                  One year of service for the applicable computation period in which he became an Eligible Employee if he is credited with the required number of Hours of Service. For that portion of such computation period ending on the date he became an Eligible Employee (for the first day of such computation period if he became an Eligible Employee on the first day of such computation period), the Employee will be credited with the greater of (i) his actual Hours of Service or (ii) the number of Hours of Service that is equivalent to the fractional part of a year of elapsed time service credited as of the date he became an Eligible Employee, if any. In determining the equivalent Hours of Service, the Employee shall be credited with 190 Hours of Service for each month and any fractional part of a month in such fractional part of a year. The number of months and any fractional part of a month shall be determined by multiplying the fractional part of a year, expressed as a decimal, by 12. For the remaining portion of such computation period (the period beginning on the second day of such computation period and ending on the last day of such computation period if he became an

 

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Eligible Employee on the first day of such computation period), the Employee will be credited with his actual Hours of Service.

 

(3)                                  The Employee’s service determined under this Plan using the hours method after the end of the computation period in which he became an Eligible Employee.

 

If an Employee has been a participant in another plan of the Employer that credited service under the hours method for any purpose that under this Plan is determined using the elapsed time method, then the Employee’s service shall be equal to the sum of (4), (5), and (6) below:

 

(4)                                  The number of whole years of service credited to the Employee under the other plan as of the beginning of the computation period under that plan in which he became an Eligible Employee under this Plan.

 

(5)                                  The greater of (i) the service that would be credited to the Employee for that entire computation period using the elapsed time method or (ii) the service credited to him under the other plan as of the date he became an Eligible Employee under this Plan.

 

(6)                                  The Employee’s service determined under this Plan using the elapsed time method after the end of the applicable computation period under the other plan in which he became an Eligible Employee.

 

If an Employee has been a participant in a Controlled Group member’s plan that credited service under a different method than is used in this Plan, in order to determine entry and vesting, the provisions in (b) above shall apply as though the Controlled Group member’s plan was a plan of the Employer.

 

Any modification of service contained in this Plan shall be applicable to the service determined pursuant to this section.

 

SECTION 10.14—MILITARY SERVICE.

 

Notwithstanding any provision of this Plan to the contrary, the Plan shall provide contributions, benefits, and service credit with respect to qualified military service in accordance with Code Section 414(u). Loan repayments shall be suspended under this Plan as permitted under Code Section 414(u).

 

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ARTICLE XI

 

TOP-HEAVY PLAN REQUIREMENTS

 

SECTION 11.01—APPLICATION.

 

The provisions of this article shall supersede all other provisions in the Plan to the contrary.  The provisions of this article shall apply for purposes of determining whether the Plan is a Top-heavy Plan for Plan Years beginning after December 31, 2001, and whether the Plan satisfies the minimum benefit requirements of Code Section 416(c) for such years.

 

For the purpose of applying the Top-heavy Plan requirements of this article, all members of the Controlled Group shall be treated as one Employer. The term Employer, as used in this article, shall be deemed to include all members of the Controlled Group, unless the term as used clearly indicates only the Employer is meant.

 

The accrued benefit or account of a participant that results from deductible employee contributions shall not be included for any purpose under this article.

 

The minimum vesting and contribution provisions of the MODIFICATION OF VESTING REQUIREMENTS and MODIFICATION OF CONTRIBUTIONS SECTIONS of this article shall not apply to any Employee who is included in a group of Employees covered by a collective bargaining agreement which the Secretary of Labor finds to be a collective bargaining agreement between employee representatives and one or more employers, including the Employer, if there is evidence that retirement benefits were the subject of good faith bargaining between such representatives. For this purpose, the term “employee representatives” does not include any organization more than half of whose members are employees who are owners, officers, or executives.

 

SECTION 11.02—DEFINITIONS.

 

For purposes of this article the following terms are defined:

 

Aggregation Group means:

 

(a)                                  each of the Employer’s qualified plans in which a Key Employee is a participant during the Plan Year containing the Determination Date or any of the four preceding Plan Years (regardless of whether the plans have terminated),

 

(b)                                 each of the Employer’s other qualified plans which allows the plan(s) described in (a) above to meet the nondiscrimination requirement of Code Section 401(a)(4) or the minimum coverage requirement of Code Section 410, and

 

(c)                                  any of the Employer’s other qualified plans not included in (a) or (b) above which the Employer desires to include as part of the Aggregation Group. Such a qualified plan shall be included only if the Aggregation Group would continue to satisfy the requirements of Code Sections 401(a)(4) and 410.

 

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The plans in (a) and (b) above constitute the “required” Aggregation Group. The plans in (a), (b), and (c) above constitute the “permissive” Aggregation Group.

 

Compensation means compensation as defined in the CONTRIBUTION LIMITATION SECTION of Article III.

 

Determination Date means as to any plan, for any plan year subsequent to the first plan year, the last day of the preceding plan year. For the first plan year of the plan, the Determination Date is the last day of that year.

 

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 is:

 

(a)                                  an officer of the Employer having Compensation for the Plan Year greater than $130,000 (as adjusted under Code Section 416(i)(1) for Plan Years beginning after December 31, 2002),

 

(b)                                 a 5-percent owner of the Employer, or

 

(c)                                  a 1-percent owner of the Employer having Compensation for the Plan Year of more than $150,000.

 

The determination of who is a Key Employee shall be made according to Code Section 416(i)(1) and the applicable regulations and other guidance of general applicability issued thereunder.

 

Nonkey Employee means any Employee who is not a Key Employee.

 

Top-heavy Plan means a plan that is top-heavy for any plan year. This Plan shall be top-heavy if any of the following conditions exist:

 

(a)                                  The Top-heavy Ratio for this Plan exceeds 60 percent and this Plan is not part of any required Aggregation Group or permissive Aggregation Group.

 

(b)                                 This Plan is a part of a required Aggregation Group, but not part of a permissive Aggregation Group, and the Top-heavy Ratio for the required Aggregation Group exceeds 60 percent.

 

(c)                                  This Plan is a part of a required Aggregation Group and part of a permissive Aggregation Group and the Top-heavy Ratio for the permissive Aggregation Group exceeds 60 percent.

 

Top-heavy Ratio means:

 

(a)                                  If the Employer maintains one or more defined contribution plans (including any simplified employee pension plan) and the Employer has not maintained any defined benefit plan which during the five-year period ending on the Determination Date(s) has or has had accrued benefits, the Top-heavy Ratio for this Plan alone or for the required or permissive Aggregation Group, as appropriate, is a fraction, the numerator of which is the sum of the account balances of all Key Employees as of the Determination Date(s) (including any part of any account balance distributed in the one-year period ending on the Determination Date(s) and distributions under a terminated plan which if it had not been terminated would have been required to be included in the

 

81

 

Aggregation Group), and the denominator of which is the sum of all account balances (including any part of any account balance distributed in the one-year period ending on the Determination Date(s) and distributions under a terminated plan which if it had not been terminated would have been required to be included in the Aggregation Group), both computed in accordance with Code Section 416 and the regulations thereunder. In the case of a distribution made for a reason other than Severance from Employment, death, or disability, this provision shall be applied by substituting “five-year period” for “one-year period.” Both the numerator and denominator of the Top-heavy Ratio are increased to reflect any contribution not actually made as of the Determination Date, but which is required to be taken into account on that date under Code Section 416 and the regulations thereunder.

 

(b)                                 If the Employer maintains one or more defined contribution plans (including any simplified employee pension plan) and the Employer maintains or has maintained one or more defined benefit plans which during the five-year period ending on the Determination Date(s) has or has had accrued benefits, the Top-heavy Ratio for any required or permissive Aggregation Group, as appropriate, is a fraction, the numerator of which is the sum of the account balances under the aggregated defined contribution plan or plans of all Key Employees, determined in accordance with (a) above, and the present value of accrued benefits under the aggregated defined benefit plan or plans for all Key Employees as of the Determination Date(s), and the denominator of which is the sum of the account balances under the aggregated defined contribution plan or plans for all participants, determined in accordance with (a) above, and the present value of accrued benefits under the defined benefit plan or plans for all participants as of the Determination Date(s), all determined in accordance with Code Section 416 and the regulations thereunder. The accrued benefits under a defined benefit plan in both the numerator and denominator of the Top-heavy Ratio are increased for any distribution of an accrued benefit made in the one-year period ending on the Determination Date (and distributions under a terminated plan which if it had not been terminated would have been required to be included in the Aggregation Group). In the case of a distribution made for a reason other than Severance from Employment, death, or disability, this provision shall be applied by substituting “five-year period” for “one-year period.”

 

(c)                                  For purposes of (a) and (b) above, the value of account balances and the present value of accrued benefits will be determined as of the most recent Valuation Date that falls within or ends with the 12-month period ending on the Determination Date, except as provided in Code Section 416 and the regulations thereunder for the first and second plan years of a defined benefit plan. The account balances and accrued benefits of a participant (i) who is not a Key Employee but who was a Key Employee in a prior year or (ii) who has not been credited with at least one hour of service with any employer maintaining the plan at any time during the one-year period ending on the Determination Date will be disregarded. The calculation of the Top-heavy Ratio and the extent to which distributions, rollovers, and transfers are taken into account will be made in accordance with Code Section 416 and the regulations thereunder. Deductible employee contributions will not be taken into account for purposes of computing the Top-heavy Ratio. When aggregating plans, the value of account balances and accrued benefits will be calculated with reference to the Determination Dates that fall within the same calendar year.

 

The accrued benefit of a participant other than a Key Employee shall be determined under (i) the method, if any, that uniformly applies for accrual purposes under all defined benefit plans maintained by the Employer,

 

82

 

or (ii) if there is no such method, as if such benefit accrued not more rapidly than the slowest accrual rate permitted under the fractional rule of Code Section 411(b)(1)(C).

 

SECTION 11.03—MODIFICATION OF VESTING REQUIREMENTS.

 

A Participant’s Vesting Percentage is at all times at least as great as the Vesting Percentage required to satisfy the requirements of Code Section 416.

 

The part of the Participant’s Vested Account resulting from the minimum contributions required pursuant to the MODIFICATION OF CONTRIBUTIONS SECTION of this article (to the extent required to be nonforfeitable under Code Section 416(b)) may not be forfeited under Code Section 411(a)(3)(B) or (D).

 

SECTION 11.04—MODIFICATION OF CONTRIBUTIONS.

 

During any Plan Year in which this Plan is a Top-heavy Plan, the Employer shall make a minimum contribution as of the last day of the Plan Year for each Nonkey Employee who is an Employee on the last day of the Plan Year and who was an Active Participant at any time during the Plan Year. A Nonkey Employee is not required to have a minimum number of Hours of Service or minimum amount of Compensation in order to be entitled to this minimum. A Nonkey Employee who fails to be an Active Participant merely because his Compensation is less than a stated amount or merely because of a failure to make mandatory participant contributions or, in the case of a cash or deferred arrangement, elective contributions shall be treated as if he were an Active Participant. The minimum is the lesser of (a) or (b) below:

 

(a)                                  3 percent of such person’s Compensation for such Plan Year.

 

(b)                                 The “highest percentage” of Compensation for such Plan Year at which the Employer’s Contributions are made for or allocated to any Key Employee. The highest percentage shall be determined by dividing the Employer Contributions made for or allocated to each Key Employee during the Plan Year by the amount of his Compensation for such Plan Year, and selecting the greatest quotient (expressed as a percentage). To determine the highest percentage, all of the Employer’s defined contribution plans within the Aggregation Group shall be treated as one plan. The minimum shall be the amount in (a) above if this Plan and a defined benefit plan of the Employer are required to be included in the Aggregation Group and this Plan enables the defined benefit plan to meet the requirements of Code Section 401(a)(4) or 410.

 

For purposes of (a) and (b) above, Compensation shall be limited by Code Section 401(a)(17).

 

If the Employer’s contributions and allocations otherwise required under the defined contribution plan(s) are at least equal to the minimum above, no additional contribution shall be required. If the Employer’s total contributions and allocations are less than the minimum above, the Employer shall contribute the difference for the Plan Year.

 

The minimum contribution applies to all of the Employer’s defined contribution plans in the aggregate which are Top-heavy Plans. A minimum contribution under a profit sharing plan shall be made without regard to whether or not the Employer has profits.

 

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If a person who is otherwise entitled to a minimum contribution above is also covered under another defined contribution plan of the Employer’s which is a Top-heavy Plan during that same Plan Year, any additional contribution required to meet the minimum above shall be provided in this Plan.

 

If a person who is otherwise entitled to a minimum contribution above is also covered under a defined benefit plan of the Employer’s that is a Top-heavy Plan during that same Plan Year, the minimum benefits for him shall not be duplicated. The defined benefit plan shall provide an annual benefit for him on, or adjusted to, a straight life basis equal to the lesser of:

 

(c)                                  2 percent of his average compensation multiplied by his years of service, or

 

(d)                                 20 percent of his average compensation.

 

Average compensation and years of service shall have the meaning set forth in such defined benefit plan for this purpose.

 

For purposes of this section, any employer contribution made according to a salary reduction or similar arrangement shall not apply in determining if the minimum contribution requirement has been met, but shall apply in determining the minimum contribution required. Matching contributions, as defined in Code Section 401(m), shall be taken into account for purposes of satisfying the minimum contribution requirements of Code Section 416(c)(2) and the Plan. Matching contributions that are used to satisfy the minimum contribution requirements shall be treated as matching contributions for purposes of the actual contribution percentage test and other requirements of Code Section 401(m).

 

The requirements of this section shall be met without regard to any Social Security contribution.

 

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By executing this Plan, the Primary Employer acknowledges having counseled to the extent necessary with selected legal and tax advisors regarding the Plan’s legal and tax implications.

 

Executed this 30th day of December, 2009.

 

	
 
    	
ENERGYSOLUTIONS, LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Wenny Firth
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
Treasury Program Director
    
	
 
    	
Title
    
				

 

85

 

PROTECTED BENEFIT ADDENDUM

 

The following benefit(s) were included in the Duratek 401(k) Plan and were removed as of January 1, 2007. According to Section 411(d)(6) of the Internal Revenue Code, the benefit(s) described below shall be available to Plan Participants who were former participants of the Duratek 401(k) Plan and who had an account balance on that date (or the date of adoption, if later). The protected benefit(s) only apply to the account balance accrued as of that date, adjusted for earnings or losses since that date.

 

In-service withdrawal of Matching Contributions which have been maintained in the Participant’s Account for at least 24 months.

 

The following benefit(s) were included in the RWE NUKEM Corporation 401(k) Retirement Plan and were amended as of January 1, 2008. According to Section 411(d)(6) of the Internal Revenue Code, the benefit(s) described below shall be available to Plan Participants who were former participants of the RWE NUKEM Corporation 401(k) Retirement Plan and who had an account balance on that date (or the date of adoption, if later).  The protected benefit(s) only apply to the account balance accrued as of that date, adjusted for earnings or losses since that date.

 

Disability — an illness or injury of a potentially permanent nature, expected to last for a continuous period of not less than 12 months or can be expected to result in death, certified by a physician selected by or satisfactory to the Employer.

 

86

 

AMENDMENT TO COMPLY WITH THE HEROES EARNINGS
 ASSISTANCE AND RELIEF TAX ACT OF 2008

 

This amendment of the Plan is adopted to comply with the requirements of the Heroes Earnings Assistance and Relief Tax Act of 2008 (HEART Act) and the guidance provided in IRS Notice 2010-15. This amendment is to be construed in accordance with such law and guidance. This amendment shall continue to apply to the Plan, including the Plan as later amended, until such provisions are integrated into the Plan or the provisions of this amendment are specifically amended.

 

This amendment shall supersede any previous amendment and the provisions of the Plan to the extent those provisions are inconsistent with the provisions of this amendment.

 

ENERGYSOLUTIONS, LLC 401(K) PROFIT SHARING PLAN

 

The Plan named above gives the undersigned the right to amend it at any time. According to that right, the Plan is amended as follows:

 

By adding the following to the definition of Compensation in the DEFINITIONS SECTION of Article I:

 

Beginning January 1, 2009, Compensation shall include Differential Wage Payments.

 

By adding to the DEFINITIONS SECTION of Article I, the following definition beginning January 1, 2009:

 

Differential Wage Payments means any payments which are made by an Employer to an individual with respect to any period during which the individual is performing Qualified Military Service while on active duty for a period of more than 30 days, and represents all or a portion of the wages the individual would have received from the Employer if the individual were performing service for the Employer.

 

By adding the following to the definition of Employee in the DEFINITIONS SECTION of Article I:

 

Beginning January 1, 2009, the term Employee shall include any individual receiving Differential Wage Payments.

 

By adding to the DEFINITIONS SECTION of Article I, the following definition beginning January 1, 2007:

 

Qualified Military Service means any service in the uniformed services (as defined in Chapter 43 of Title 38 of the U.S. Code) by any individual if such individual is entitled to reemployment rights under such chapter with respect to such service.

 

By adding the following to the definition of Vesting Percentage (if defined in the Plan) in the DEFINITIONS SECTION of Article I:

 

Beginning January 1, 2007, the Vesting Percentage for a Participant who dies or becomes disabled (and such disability is determined to meet the definition of Totally and Permanently Disabled, if defined in the Plan) while performing Qualified Military Service shall be 100%.

 

1

 

By adding the following to subparagraph (b) in the EMPLOYER CONTRIBUTIONS SECTION of Article III:

 

Beginning November 13, 2008, the Employer shall also make Matching Contributions for a Participant who dies or becomes disabled (and such disability is determined to meet the definition of Totally and Permanently Disabled, if defined in the Plan) while performing Qualified Military Service. The amount of such Matching Contribution shall be based on the Participant’s average actual Elective Deferral Contributions for the lesser of (i) the 12-month period of service with the Employer immediately prior to Qualified Military Service, or (ii) if service with the Employer is less than such 12-month period, the actual length of continuous service with the Employer, in accordance with Code Section 414(u)(9) and any subsequent guidance.

 

If the requirements to receive a contribution or allocation do not apply to a Participant who dies or becomes disabled during the Plan Year, by adding the following to the end of the first paragraph in the ALLOCATION SECTION of Article III:

 

Beginning January 1, 2007, a person shall also meet the requirements of this section if he dies or becomes disabled (and such disability is determined to meet the definition of Totally and Permanently Disabled, if defined in the Plan) while performing Qualified Military Service at any time during the Plan Year.

 

By adding the following to the definition of Compensation in the CONTRIBUTION LIMITATION SECTION of Article III:

 

Beginning January 1, 2009, Compensation shall include Differential Wage Payments.

 

By adding the following to the definition of Contribution Percentage in the EXCESS AMOUNTS SECTION of Article III:

 

Contribution Percentages shall be calculated without regard to Differential Wage Payments paid on or after January 1, 2009.

 

By adding the following to the definition of Contribution Percentage Amounts in the EXCESS AMOUNTS SECTION of Article III:

 

Contribution Percentage Amounts shall not include Participant Contributions withheld from Differential Wage Payments paid on or after January 1, 2009 and Matching Contributions based on Elective Deferral Contributions and Participant Contributions withheld from such Differential Wage Payments.

 

By adding the following to the definition of Deferral Percentage in the EXCESS AMOUNTS SECTION of Article III:

 

Deferral Percentages shall be calculated without regard to Differential Wage Payments paid on or after January 1, 2009 and the Elective Deferral Contributions based on such Differential Wage Payments.

 

2

 

By adding the following to the VESTED BENEFITS SECTION of Article V:

 

Beginning January 1, 2009, a Participant who has been performing Qualified Military Service for a period of more than 30 days is deemed to have had a Severance from Employment for purposes of requesting a distribution of his Vested Account resulting from Elective Deferral Contributions.  The Plan will suspend Elective Deferral Contributions and Participant Contributions (if any) for six months after receipt of the distribution.

 

By adding the following to subparagraph (b) in the WHEN BENEFITS START SECTION of Article V:

 

Beginning January 1, 2009, Elective Deferral Contributions may be distributed if the Participant is deemed to have a Severance from Employment as described in Code Section 414(u)(12)(B)(i).

 

By adding the following to the MILITARY SERVICE SECTION of Article X:

 

Beginning January 1, 2007, a Participant who dies on or after January 1, 2007 while performing Qualified Military Service is treated as having resumed and then terminated employment on account of death, in accordance with Code Section 401(a)(37) and any subsequent guidance.  The survivors of such Participant are entitled to any additional benefits provided under the Plan on account of death of the Participant.

 

By modifying the FORFEITURES SECTION of Article III (if applicable) as follows:

 

The forfeiture of a Participant’s Nonvested Account shall be based on the distribution of his Vested Account derived from Employer Contributions. If a Participant again becomes an Eligible Employee after receiving a distribution which caused all of his Nonvested Account to be forfeited, he shall have the right to repay to the Plan the entire amount of the distribution he received (excluding any amount of such distribution resulting from Participant Contributions or Rollover Contributions, if any).  Upon such repayment, the Plan Administrator shall restore to his Account an amount equal to his Nonvested Account that was forfeited on the date of distribution, unadjusted for any investment gains or losses.  If no amount is to be repaid because the Participant was deemed to have received a distribution, or only received a distribution of Participant Contributions and Rollover Contributions, and he again performs an Hour of Service as an Eligible Employee within the repayment period, the Plan Administrator shall restore the Participant’s Account as if he had made a required repayment on the date he performed such Hour of Service.

 

This amendment is made an integral part of the aforesaid Plan and is controlling over the terms of said Plan with respect to the particular items addressed expressly therein. All other provisions of the Plan remain unchanged and controlling.

 

Unless otherwise stated on any page of this amendment, eligibility for benefits and the amount of any benefits payable to or on behalf of an individual who is an Inactive Participant on the effective date(s) stated above, shall be determined according to the provisions of the aforesaid Plan as in effect on the day before he became an Inactive Participant.

 

3

 

Signing this amendment, the undersigned, as plan sponsor, has made the decision to adopt this plan amendment. The undersigned is acting in reliance on their own discretion and on the legal and tax advice of their own advisors, and not that of any member of the Principal Financial Group or any representative of a member company of the Principal Financial Group.

 

 

Signed this 3rd day of December, 2010.

 

 

	
 
    	
For   the Employer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Richard Tooze
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
SVP & Treasurer
    
	
 
    	
 
    	
Title
    

 

4

 

AMENDMENT NO. 1

 

ENERGYSOLUTIONS, LLC 401(k) PROFIT SHARING PLAN

 

The Plan named above gives the Employer the right to amend it at any time. According to that right, the Plan is amended effective January 1, 2011, as follows:

 

By striking the fifth paragraph from subparagraph (a) of the EMPLOYER CONTRIBUTIONS SECTION of Article III and substituting the following:

 

A Participant who is age 50 or older by the end of the taxable year shall be eligible to make Catch-up Contributions. A separate elective deferral agreement must be submitted by the Participant to make such Catch-up Contributions.

 

By adding the following as the third paragraph of subparagraph (b) in the EMPLOYER CONTRIBUTIONS SECTION of Article III:

 

Elective Deferral Contributions that are Catch-up Contributions shall not be matched.

 

This amendment is made an integral part of the aforesaid Plan and is controlling over the terms of said Plan with respect to the particular items addressed expressly herein. All other provisions of the Plan remain unchanged and controlling.

 

Unless otherwise stated on any page of this amendment, eligibility for benefits and the amount of any benefits payable to or on behalf of an individual who is an Inactive Participant on the effective date(s) stated above, shall be determined according to the provisions of the aforesaid Plan as in effect on the day before he became an Inactive Participant.

 

Signing this amendment, the Employer, as plan sponsor, has made the decision to adopt this plan amendment. The Employer is acting in reliance on its own discretion and on the legal and tax advice of its own advisors, and not that of any member of the Principal Financial Group or any representative of a member company of the Principal Financial Group.

 

 

Signed this 1st day of April, 2011.

 

	
 
    	
ENERGYSOLUTIONS, LLC
    
	
 
    	
 
    
	
 
    	
By
    	
/s/ Richard Tooze
    
	
 
    	
 
    
	
 
    	
SVP &   Treasurer
    
	
 
    	
Title
    

 

1

 

AMENDMENT NO. 2

 

ENERGYSOLUTIONS, LLC 401(k) PROFIT SHARING PLAN

 

The Plan named above gives the Employer the right to amend it at any time. According to that right, the Plan is amended effective December 2, 2011, as follows:

 

By striking the fifth paragraph from subparagraph (a) of the EMPLOYER CONTRIBUTIONS SECTION of Article III (as previously amended by Amendment No. 1) and substituting the following:

 

A Participant who is age 50 or older by the end of the taxable year shall be eligible to make Catch-up Contributions. A separate elective deferral agreement must be submitted by the Participant to make such Catch-up Contributions, unless the dollar limitation contained in Code Section 402(g) has been reached by such Participant. If such limit is reached, Elective Deferral Contributions will be reclassified as Catch-up Contributions without a separate elective deferral agreement being submitted by the Participant.

 

This amendment is made an integral part of the aforesaid Plan and is controlling over the terms of said Plan with respect to the particular items addressed expressly herein. All other provisions of the Plan remain unchanged and controlling.

 

Unless otherwise stated on any page of this amendment, eligibility for benefits and the amount of any benefits payable to or on behalf of an individual who is an Inactive Participant on the effective date(s) stated above, shall be determined according to the provisions of the aforesaid Plan as in effect on the day before he became an Inactive Participant.

 

Signing this amendment, the Employer, as plan sponsor, has made the decision to adopt this plan amendment. The Employer is acting in reliance on its own discretion and on the legal and tax advice of its own advisors, and not that of any member of the Principal Financial Group or any representative of a member company of the Principal Financial Group.

 

 

Signed this 9th day of December, 2011.

 

	
 
    	
ENERGYSOLUTIONS, LLC
    
	
 
    	
 
    
	
 
    	
By
    	
/s/ Val J. Christensen
    
	
 
    	
 
    
	
 
    	
President   and CEO
    
	
 
    	
Title
    

 

1

 

AMENDMENT TO COMPLY WITH

THE WORKER, RETIREE, AND EMPLOYER RECOVERY ACT OF 2008
 AND THE SMALL BUSINESS JOBS ACT OF 2010

 

This amendment of the Plan is adopted to comply with the requirements of the Worker, Retiree, and Employer Recovery Act of 2008 (WRERA) and the Small Business Jobs Act of 2010 (SBJA). This amendment is to be construed in accordance with such laws. This amendment shall continue to apply to the Plan, including the Plan as later amended, until such provisions are integrated into the Plan or the provisions of this amendment are specifically amended.

 

This amendment shall supersede any previous amendment and the provisions of the Plan to the extent those provisions are inconsistent with the provisions of this amendment.

 

ENERGYSOLUTIONS, LLC 401(K) PROFIT SHARING PLAN

 

The Plan named above gives the undersigned the right to amend it at any time. According to that right, the Plan is amended as follows:

 

By adding the following to the definition of Eligible Retirement Plan in the DEFINITIONS SECTION of Article I:

 

For taxable years beginning on or after January 1, 2011, if any portion of an Eligible Rollover Distribution is attributable to payments or distributions from a designated Roth account, an Eligible Retirement Plan with respect to such portion shall include another designated Roth account of such individual under an eligible plan under Code Section 457(b) which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state.

 

If the Plan allows Roth Elective Deferral Contributions and Rollover Contributions from an eligible plan under Code Section 457(b) which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state (as specified in the ROLLOVER CONTRIBUTIONS SECTION of Article III), by adding the following modification to the allowed rollover(s):

 

Beginning January 1, 2011, a Rollover Contribution that is a direct rollover from an eligible plan under Code Section 457(b) shall include any portion of a designated Roth account. A Rollover Contribution that is a participant rollover from an eligible plan under Code Section 457(b) shall include distributions of a designated Roth account (only to the extent such amount would otherwise be includible in a Participant’s gross income).

 

If the Plan does not allow Roth Elective Deferral Contributions, but does allow Rollover Contributions from an eligible plan under Code Section 457(b) which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state (as specified in the ROLLOVER CONTRIBUTIONS SECTION of Article III), by adding the following modification to the allowed rollover(s):

 

Beginning January 1, 2011, a Rollover Contribution that is a direct rollover from an eligible plan under Code Section 457(b) shall exclude any portion of a designated Roth account. A Rollover Contribution that is a participant rollover from an eligible plan under Code Section 457(b) shall exclude distributions of a designated Roth account.

 

1

 

By adding the following as the second paragraph in the APPLICATION SECTION of Article VII:

 

Notwithstanding the provisions of this article, a Participant or Beneficiary who would have been required to receive required minimum distributions (described in the REQUIRED MINIMUM DISTRIBUTIONS SECTION of this article) for 2009 but for the enactment of Code Section 401(a)(9)(H), and who would have satisfied that requirement by receiving distributions that are (i) equal to the 2009 required minimum distributions or (ii) one or more payments in a series of substantially equal distributions (that include the 2009 required minimum distributions) made at least annually and expected to last for the life (or life expectancy) of the Participant, the joint lives (or joint life expectancy) of the Participant and the Participant’s Designated Beneficiary, or for a period of at least 10 years, will not receive those required minimum distributions for 2009 unless the Participant or Beneficiary chooses to receive such distributions. Solely for purposes of applying the provisions of the DIRECT ROLLOVERS SECTION of Article X, required minimum distributions made for 2009 will be treated as Eligible Rollover Distributions.

 

This amendment is made an integral part of the aforesaid Plan and is controlling over the terms of said Plan with respect to the particular items addressed expressly therein. All other provisions of the Plan remain unchanged and controlling.

 

Unless otherwise stated on any page of this amendment, eligibility for benefits and the amount of any benefits payable to or on behalf of an individual who is an Inactive Participant on the effective date(s) stated above, shall be determined according to the provisions of the aforesaid Plan as in effect on the day before he became an Inactive Participant.

 

Signing this amendment, the undersigned, as plan sponsor, has made the decision to adopt this plan amendment. The undersigned is acting in reliance on their own discretion and on the legal and tax advice of their own advisors, and not that of any member of the Principal Financial Group or any representative of a member company of the Principal Financial Group.

 

Signed this 9th day of December, 2011.

 

 

	
 
    	
For   the Employer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Val J. Christensen
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
President and CEO
    
	
 
    	
 
    	
Title
    

 

2

 

AMENDMENT NO. 3

 

ENERGYSOLUTIONS, LLC 401(k) PROFIT SHARING PLAN

 

The Plan named above gives the Employer the right to amend it at any time. According to that right, the Plan is amended as follows:

 

Effective July 25, 2012:

 

By adding the following immediately following the second sentence of the first paragraph of the INVESTMENT AND TIMING OF CONTRIBUTIONS SECTION of Article IV:

 

Qualifying Employer Securities shall be an investment option offered under the Plan.

 

By striking the first sentence from the first paragraph of the INVESTMENT IN QUALIFYING EMPLOYER SECURITIES SECTION of Article IV and substituting the following:

 

Qualifying Employer Securities shall be an investment option offered under the Plan. A Participant may direct a portion of his or her Account, not to exceed 30%, to be invested in Qualifying Employer Securities. Such limit shall not require rebalancing of such investments if they grow to exceed the limit nor will it prevent distributions from the Plan.

 

Effective August 1, 2012:

 

By striking the following definitions from the DEFINITIONS SECTION of Article I:

 

Eligibility Break in Service

Eligibility Computation Period

Eligibility Service

Employment Commencement Date

Reemployment Commencement Date

 

By striking the definition of Entry Date from the DEFINITIONS SECTION of Article I and substituting the following:

 

Entry Date means the date an Employee first enters the Plan as an Active Participant. See the ACTIVE PARTICIPANT SECTION of Article II.

 

By striking subparagraphs (a), (b) and (c) from the ACTIVE PARTICIPANT SECTION of Article II and substituting the following:

 

(a)               An Employee shall first become an Active Participant (begin active participation in this plan) on the earliest date on which he is an Eligible Employee. This date is his Entry Date.

 

If the Plan’s eligibility requirements are changed, an Employee who was an Active Participant immediately prior to the effective date of the change is deemed to satisfy the new requirements and his Entry Date shall not change.

 

Each Employee who was an Active Participant on the day before the effective date of this amendment shall continue to be an Active Participant if he is still an Eligible Employee on such amendment effective date and his Entry Date shall not change.

 

1

 

In the event an Employee who is not an Eligible Employee becomes an Eligible Employee, he shall become an Active Participant immediately if he has satisfied the eligibility requirements above and would have otherwise previously become an Active Participant had he met the definition of Eligible Employee. This date is his Entry Date.

 

(b)              An Inactive Participant shall again become an Active Participant (resume active participation in the Plan) on the date he again performs an Hour of Service as an Eligible Employee. This date is his Reentry Date.

 

Upon again becoming an Active Participant, he shall cease to be an Inactive Participant.

 

(c)               A former Participant shall again become an Active Participant (resume active participation in the Plan) on the date he again performs an Hour of Service as an Eligible Employee. This date is his Reentry Date.

 

This amendment is made an integral part of the aforesaid Plan and is controlling over the terms of said Plan with respect to the particular items addressed expressly herein. All other provisions of the Plan remain unchanged and controlling.

 

Unless otherwise stated on any page of this amendment, eligibility for benefits and the amount of any benefits payable to or on behalf of an individual who is an Inactive Participant on the effective date(s) stated above, shall be determined according to the provisions of the aforesaid Plan as in effect on the day before he became an Inactive Participant.

 

Signing this amendment, the Employer, as plan sponsor, has made the decision to adopt this plan amendment. The Employer is acting in reliance on its own discretion and on the legal and tax advice of its own advisors, and not that of any member of the Principal Financial Group or any representative of a member company of the Principal Financial Group.

 

Signed this 18th day of July, 2012.

 

	
 
    	
ENERGYSOLUTIONS, LLC
    
	
 
    	
 
    
	
 
    	
By
    	
/s/ Alvin Shaver
    
	
 
    	
 
    	
 
    
	
 
    	
Chair of Retirement Plan   Committee
    
	
 
    	
 
    	
Title
    

 

2

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