Document:

Exhibit 4.1

 

	
  COMMON STOCK

  	
   

  	
  COMMON STOCK

  
	
  CERTIFICATE NO.

  	
   

  	
  SEE REVERSE FOR CERTAIN DEFINITIONS

  
	
   

  	
  —

  	
  CUSIP

  	
   

  

 

BRADFORD BANCORP, INC.

INCORPORATED
UNDER THE LAWS OF THE STATE OF MARYLAND

 

	
  THIS CERTIFIES THAT

  	
   

  	
  [SPECIMEN]

  	
   

  	
   

  

 

is the owner of:

 

FULLY PAID AND NONASSESSABLE SHARES OF COMMON STOCK,
$0.01 PAR VALUE

PER SHARE, OF BRADFORD BANCORP, INC.

 

The shares represented by
this certificate are transferable only on the stock transfer books of Bradford
Bancorp, Inc. (the “Company”) by the holder of record hereof, or by his
duly authorized attorney or legal representative, upon the surrender of this
certificate properly endorsed.  This
certificate and the shares represented hereby are issued and shall be held
subject to all the provisions of the Articles of Incorporation of the Company
and any amendments thereto (copies of which are on file with the Corporate
Secretary of the Company), to all of which provisions the holder by acceptance
hereof, assents.  This certificate is not
valid until countersigned and registered by the Company’s Transfer Agent and
Registrar.

 

The shares evidenced by this certificate are not of an
insurable type and are not insured by the Federal Deposit Insurance
Corporation.

 

IN
WITNESS WHEREOF, BRADFORD BANCORP, INC. has caused this certificate to be executed by the
facsimile signatures of its duly authorized officers and has caused a facsimile
of its corporate seal to be hereunto affixed.

 

	
  Dated:

  	
   

  	
   

  	
   

  	
  [SEAL]

  	
   

  	
   

  

 

	
  

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  President and Chief Executive Officer

  	
   

  	
  Corporate Secretary

  

 

 

The shares represented by
this certificate are subject to a limitation contained in the Articles of
Incorporation to the effect that in no event shall any record owner of any
outstanding common stock which is beneficially owned, directly or indirectly,
by a person who beneficially owns in excess of 10% of the outstanding shares of
common stock (the “Limit”) be entitled or permitted to any vote in respect of
shares held in excess of the Limit.

 

The Board of Directors of
the Company is authorized by resolution(s), from time to time adopted, to
provide for the issuance of serial preferred stock in series and to fix and
state the voting powers, designations, preferences and relative, participating,
optional, or other special rights of the shares of each such series and the
qualifications, limitations and restrictions thereof.  The Company will furnish to any shareholder
upon request and without charge a full description of each class of stock and
any series thereof.

 

The shares represented by
this Certificate may not be cumulatively voted on any matter.

 

The following
abbreviations, when used in the inscription on the face of this certificate,
shall be construed as though they were written out in full according to
applicable laws or regulations:

 

	
  TEN COM

  	
  —

  	
  as tenants in common

  	
   

  	
  UNIF
  GIFTS MIN ACT

  	
   

  	
   

  	
  custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (Cust)

  	
   

  
	
  (Minor)

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  TEN ENT

  	
   

  	
  as tenants by the entireties

  	
   

  	
   

  	
  under Uniform Gifts to Minors Act

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  (State)

  
	
  JT TEN

  	
   

  	
  as joint tenants with right of

  survivorship and not as tenants

  in common

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Additional
  abbreviations may also be used though not in the above list.

  	
   

  	
   

  	
   

  	
   

  
											

 

For value received                     
hereby sell, assign and transfer unto

 

PLEASE
INSERT SOCIAL SECURITY OR OTHER

IDENTIFICATION
NUMBER OF ASSIGNEE

 

 

 

Please
print or typewrite name and address including postal zip code of assignee.

 

                                                                                                    
shares of the common stock represented by this certificate and do hereby
irrevocably constitute and appoint                                                                   ,
attorney, to transfer the said stock on the books of the within-named
corporation with full power of substitution in the premises.

 

	
  DATED

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  NOTICE:
  The signature to this assignment must 

  correspond with the name as written upon the face of the 

  certificate in every particular without alteration or

  enlargement or any change whatever.

  

 

	
  SIGNATURE GUARANTEED:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  THE
  SIGNATURE(S) SHOULD BE GUARANTEED BY

  AN ELIGIBLE GUARANTOR INSTITUTION, (BANKS,

  STOCKBROKERS, SAVINGS AND LOAN

  ASSOCIATIONS AND CREDIT UNIONS WITH

  MEMBERSHIP IN AN APPROVED SIGNATURE

  GUARANTEE MEDALLION PROGRAM), PURSUANT

  TO S.E.C. RULE 17Ad-15Exhibit 10.1

 

Standardized 401(k) Profit Sharing Plan

 

ADOPTION AGREEMENT FOR

 

MOREHEAD PLAN
ADMINISTRATORS, LTD.

 

STANDARDIZED 401(K)
PROFIT SHARING

PLAN AND TRUST

 

The undersigned Employer adopts Morehead Plan
Administrators, Ltd. Prototype Standardized 401(k) Profit Sharing Plan and
Trust and elects the following provisions:

 

CAUTION: Failure to properly fill out this
Adoption Agreement may result in disqualification of the Plan.

 

EMPLOYER
INFORMATION

(An amendment to the Adoption
Agreement is not needed solely to reflect a change in the information in this
Employer Information Section.)

 

	
  1.

  	
  EMPLOYER’S NAME, ADDRESS
  AND TELEPHONE NUMBER

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Bradford Federal Savings
  Bank

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:

  	
  6900 York Road

  
	
   

  	
   

  	
  Street

  
	
   

  	
   

  	
  Baltimore

  	
   

  	
  Maryland

  	
   

  	
  21212

  
	
   

  	
   

  	
  City

  	
   

  	
  State

  	
   

  	
  Zip

  
	
   

  	
  Telephone:

  	
  (410) 377-9600

  	
   

  	
   

  	
   

  	
   

  

 

	
  2.

  	
  EMPLOYER’S TAXPAYER
  IDENTIFICATION NUMBER

  	
  52-0253320

  	
   

  

 

	
  3.

  	
  TYPE OF ENTITY

  
	
   

  	
  a.

  	
  x

  	
  Corporation (including
  Tax-exempt or Non-profit Corporation)

  
	
   

  	
  b.

  	
  o

  	
  Professional Service
  Corporation

  
	
   

  	
  c.

  	
  o

  	
  S Corporation

  
	
   

  	
  d.

  	
  o

  	
  Limited Liability Company
  that is taxed as:

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  a partnership or sole
  proprietorship

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  a Corporation

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  an S Corporation

  

 

	
   

  	
  e.

  	
  o

  	
  Sole Proprietorship

  
	
   

  	
  f.

  	
  o

  	
  Partnership (including
  Limited Liability)

  
	
   

  	
  g.

  	
  o

  	
  Other:

  	
   

  	
   

  

 

	
   

  	
  AND, the Employer is a
  member of (select all that apply):

  
	
   

  	
  h.

  	
  o

  	
  a controlled group

  
	
   

  	
  i.

  	
  o

  	
  an affiliated service group

  

 

	
  4.

  	
  EMPLOYER FISCAL YEAR means
  the 12 consecutive month period:

  
	
   

  	
  Beginning on

  	
  January 1

  	
  (e.g., January 1st)

  
	
   

  	
   

  	
                month
                day

  	
   

  
	
   

  	
  and ending on

  	
  December 31

  	
   

  
	
   

  	
   

  	
                month
                day

  	
   

  

 

	
  PLAN
  INFORMATION

  
	
  (An amendment to the
  Adoption Agreement is not needed solely to reflect a change in the
  information in Questions 9, through 11.)

  

 

	
  5.

  	
  PLAN NAME:

  
	
   

  	
   

  
	
   

  	
  Bradford Federal Savings
  Bank 401(k) Profit Sharing Plan

  	
   

  

 

© Copyright 2001 Morehead Plan
Administrators, Ltd.

 

1

 

	
  6.

  	
  EFFECTIVE
  DATE

  
	
   

  	
  a.

  	
  x

  	
  This
  is a new Plan effective as of January 1, 2002   (hereinafter
  called the “Effective Date”).

  
	
   

  	
  b.

  	
  o

  	
  This
  is an amendment and restatement of a  previously
  established qualified plan of the Employer which was originally effective              
  (hereinafter called the “Effective Date”). The effective date of this
  amendment and restatement is              .

  
	
   

  	
  c.

  	
  o

  	
  FOR
  GUST RESTATEMENTS: This is an amendment and restatement of a previously
  established qualified plan of the Employer to bring the Plan into compliance
  with GUST (GATT, USERRA, SBJPA and TRA ‘97). The original Plan effective date
  was              
  (hereinafter called the “Effective Date”). Except as specifically provided in
  the Plan, the effective date of this amendment and restatement is              .

  
	
   

  	
   

  	
   

  	
  (May
  enter a restatement date that is the first day of the current Plan Year. The
  Plan contains appropriate retroactive effective dates with respect to
  provisions for the appropriate laws.)

  

 

	
  7.

  	
  PLAN
  YEAR means the 12 consecutive month period:

  
	
   

  	
   

  
	
   

  	
  Beginning
  on

  	
   

  	
  January
  1st

  	
  (e.g.,
  January 1st)

  
	
   

  	
   

  	
   

  	
   

  	
                month
                day

  	
   

  
	
   

  	
  and
  ending on

  	
   

  	
  December
  31st

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
                month
                day

  	
   

  

 

	
   

  	
  EXCEPT
  that there will be a Short Plan Year:

  
	
   

  	
  a.

  	
  x

  	
  N/A

  	
   

  	
   

  
	
   

  	
  b.

  	
  o

  	
  beginning
  on 

  	
   

  	
  (e.g.,
  July 1, 2000)

  
	
   

  	
   

  	
   

  	
   

  	
             month        day,         year

  	
   

  
	
   

  	
   

  	
   

  	
  and
  ending on

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
             month        day,         year

  	
   

  

 

	
  8.

  	
  VALUATION
  DATE means:

  
	
   

  	
  a.

  	
  x

  	
  Every
  day that the Trustee, any transfer agent appointed by the Trustee or the
  Employer, and any stock exchange used by such agent are open for business
  (daily valuation).

  
	
   

  	
  b.

  	
  o

  	
  The
  last day of each Plan Year.

  
	
   

  	
  c.

  	
  o

  	
  The
  last day of each Plan Year half (semi-annual).

  
	
   

  	
  d.

  	
  o

  	
  The
  last day of each Plan Year quarter.

  
	
   

  	
  e.

  	
  o

  	
  Other
  (specify day or dates):

  	
   

  	
  (must
  be at least once each Plan Year).

  

 

	
  9.

  	
  PLAN
  NUMBER assigned by the Employer

  
	
   

  	
  a.

  	
  o

  	
  001

  
	
   

  	
  b.

  	
  x

  	
  002

  
	
   

  	
  c.

  	
  o

  	
  003

  
	
   

  	
  d.

  	
  o

  	
  Other:

  	
   

  

 

	
  10.

  	
  TRUSTEES:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  a.

  	
  x

  	
  Individual Trustee(s) who
  serve as discretionary Trustee(s) over assets not subject to control by a
  corporate Trustee.

  
	
   

  	
   

  	
   

  	
   

  
	 
	
  Name(s)

  	
   

  	
  Title(s)

  	 

	 
	
  Dallas Arthur

  	
   

  	
   

  	 

	 
	
  Cindy Houston

  	
   

  	
   

  	 

	 
	
  Vincent Sortino

  	
   

  	
   

  	 

 

	
  

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address and Telephone
  number

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  1.

  	
  x

  	
  Use Employer address and
  telephone number.

  
	
   

  	
   

  	
  2.

  	
  o

  	
  Use address and telephone
  number below:

  

 

	
   

  	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  	
  Street

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  City

  	
   

  	
  State

  	
   

  	
  Zip

  

 

	
   

  	
   

  	
  Telephone:

  	
   

  	
   

  

 

2

 

	
   

  	
  b.

  	
  o

  	
  Corporate Trustee

  	
   

  

 

	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Street

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
   

  	
   

  	
  City

  	
   

  	
  State

  	
   

  	
  Zip

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
   

  

 

	
   

  	
   

  	
   

  	
  AND,  the
  corporate Trustee shall serve as:

  
	
   

  	
   

  	
   

  	
  1.

  	
  o  

  	
  a directed (nondiscretionary) Trustee over all Plan
  assets except for the following:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  a discretionary Trustee over all Plan assets except
  for the following:

  	
   

  
								

 

 

	
   

  	
  AND, shall a separate trust
  agreement be used with this Plan?

  
	
   

  	
  c.

  	
  o

  	
  Yes

  
	
   

  	
  d.

  	
  x

  	
  No

  
	
   

  	
  NOTE:

  	
  If Yes is selected, an executed copy of the trust
  agreement between the Trustee and the Employer must be attached to this Plan.
  The Plan and trust agreement will be read and construed together. The
  responsibilities, rights and powers of the Trustee shall be those specified
  in the trust agreement.

  
	
   

  	
   

  	
   

  

 

	
  11.

  	
  PLAN ADMINISTRATOR’S NAME,
  ADDRESS AND TELEPHONE NUMBER:

  (If none is named, the Employer will become the Administrator.)

  
	
   

  	
  a.

  	
  x

  	
  Employer (Use Employer
  address and telephone number).

  
	
   

  	
  b

  	
  o

  	
  Use name, address and
  telephone number below:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Street

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
   

  	
   

  	
  City

  	
   

  	
  State

  	
   

  	
  Zip

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
   

  

 

	
  12.

  	
  CONSTRUCTION OF PLAN

  
	
   

  	
  This Plan shall be governed
  by the laws of the state or commonwealth where the Employer’s (or, in the
  case of a corporate Trustee, such Trustee’s) principal place of business is
  located unless another state or commonwealth is specified:

  
	
   

  	
   

  
	
   

  	
   

  	
   

  

 

	
  ELIGIBILITY
  REQUIREMENTS

  
	
   

  
	
  13.

  	
  ELIGIBLE EMPLOYEES (Plan
  Section 1.18)

  
	
   

  	
  FOR ALL PURPOSES OF THE
  PLAN (EXCEPT AS ELECTED IN d. or c. BELOW FOR EMPLOYER CONTRIBUTIONS) means
  all Employees (including Leased Employees) EXCEPT:

  
	
   

  	
  NOTE:

  	
  If different exclusions
  apply to Elective Deferrals than to other Employer contributions, complete
  this part a.-b. for the Elective Deferral component of the Plan.

  
	
   

  	
  a.

  	
  x

  	
  N/A. No exclusions.

  
	
   

  	
  b.

  	
  o

  	
  The following are excluded,
  except that if b.3, is selected, such Employees will be included (select all
  that apply):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  Union Employees (as defined
  in Plan Section 1.18)

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  Non-resident aliens (as
  defined in Plan Section 1.18)

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  Employees who became
  Employees as the result of a “Code Section 410(b)(6)(C) transaction” (as
  defined in Plan Section 1.18)

  

 

	
   

  	
  HOWEVER, different
  exclusions will apply (select c. OR d. and/or e.):

  
	
   

  	
  c.

  	
  x

  	
  N/A. The options elected in
  a.-b. above apply for all purposes of the Plan.

  
	
   

  	
  d.

  	
  o

  	
  For purposes of all
  Employer contributions (other than Elective Deferrals and matching contributions).

  
	
   

  	
  e.

  	
  o

  	
  For purposes of Employer
  matching contributions.

  

 

3

 

	
   

  	
  IF d. OR c. IS SELECTED,
  the following exclusions apply for such purposes (select f. or g.):

  
	
   

  	
  f.

  	
  x

  	
  N/A. No exclusions.

  
	
   

  	
  g.

  	
  o

  	
  The following are excluded,
  except that  if g. 3. is
  selected, such Employees will be included (select all that apply):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  Union Employees (as defined
  in Plan Section 1.18)

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  Non-resident aliens (as
  defined in Plan Section 1.18)

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  Employees who became
  Employees as the result of a “Code Section 410(b)(6)(C) transaction” (as
  defined in Plan Section 1.18)

  

 

	
  14.

  	
  THE FOLLOWING AFFILIATED
  EMPLOYER. (Plan Section 1.6) will adopt this Plan as a Participating Employer
  (if there is more than one, or if Affiliated Employers adopt this Plan after
  the date the Adoption Agreement is executed, attach a list to this Adoption
  Agreement of such Affiliated Employers including their names, addresses,
  taxpayer identification numbers and types of entities):

  
	
   

  	
  NOTE:

  	
  Regardless of the election
  below. Employees of an Affiliated Employer are generally treated as Employees
  of the Employer. However, if the transition rule for certain acquisitions and
  dispositions applies (Code Section 410(b)(6)(C)), then Employees of the Affiliated
  Employer will not be considered Employees of the Employer until the
  expiration of the transition period unless the Affiliated Employer actually
  adopts the Plan prior to such date.

  
	
   

  	
  a.

  	
  x

  	
  N/A

  
	
   

  	
  b.

  	
  o

  	
  Name of First Affiliated
  Employer:

  	
   

  

 

	
   

  	
   

  	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Street

  	
   

  	
   

  	
   

  

 

	
   

  	
   

  	
   

  	
   

  	
  City

  	
   

  	
  State

  	
   

  	
  Zip

  
	
   

  	
   

  	
   

  	
  Telephone:

  	
   

  

 

	
   

  	
   

  	
   

  	
  Taxpayer Identification
  Number:

  	
   

  	
   

  

 

	
   

  	
  AND, the Affiliated
  Employer is:

  
	
   

  	
  c.

  	
  o

  	
  Corporation (including
  Tax-exempt, Non-profit or Professional Service Corporation)

  
	
   

  	
  d.

  	
  o

  	
  S Corporation

  
	
   

  	
  e.

  	
  o

  	
  Limited Liability Company
  that is taxed as:

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  a partnership or sole
  proprietorship

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  a Corporation

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  an S Corporation

  
	
   

  	
  f.

  	
  o

  	
  Sole Proprietorship

  
	
   

  	
  g.

  	
  o

  	
  Partnership (including
  Limited Liability)

  
	
   

  	
  h.

  	
  o

  	
  Other:

  	
   

  
							

 

	
  15.

  	
  CONDITIONS OF ELIGIBILITY (Plan
  Section 3.1)

  
	
   

  	
  Any Eligible Employee will
  be eligible to participate in the Plan upon satisfaction of the following:

  
	
   

  	
  NOTE:

  	
  If the Year(s) of Service
  selected is or includes a fractional year, an Employee will not be required
  to complete any specified number of Hours of Service to receive credit for
  such fractional year. If expressed in months of service, an Employee will not
  be required to complete any specified number of Hours of Service in a
  particular month, unless elected in b.4. or i.4. below.

  

 

	
   

  	
  ELIGIBILITY FOR ALL
  PURPOSES OF THE PLAN (EXCEPT AS ELECTED IN e.-k. BELOW FOR EMPLOYER
  CONTRIBUTIONS) (select a. or all that apply of b., c.. and d.):

  
	
   

  	
  NOTE:

  	
  If different conditions
  apply to Elective Deferrals than to other Employer contributions, complete
  this part a.-d. for the Elective Deferral component of the Plan.

  
	
   

  	
  a.

  	
  o

  	
  No age or service required.
  (Go to c.-g. below)

  
	
   

  	
  b.

  	
  x

  	
  Completion of the following
  service requirement which is based on Years of Service (or Periods of Service
  if the Elapsed Time Method is elected):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  No service requirement

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  1/2 Year of Service or
  Period of Service

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  1 Year of Service or Period
  of Service

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
                (not to exceed 1,000) Hours of Service
  within               (not to exceed 12) months from the Eligible Employee’s employment
  commencement date. If an Employee does not complete the stated Hours of
  Service during the specified time period, the Employee is subject to the Year
  of Service requirement in b.3. above.

  
	
   

  	
   

  	
   

  	
  5.

  	
  x

  	
  Other: 

  	
  Three (3)Months of Service

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  (may not exceed one (1)
  Year of Service or Period of Service)

  

 

4

 

	
   

  	
  c.

  	
  x

  	
  Attainment of
  age:

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  No age
  requirement

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  20 1/2

  
	
   

  	
   

  	
   

  	
  3.

  	
  x

  	
  21

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  Other:              
  (may not exceed 21)

  
	
   

  	
  d.

  	
  o

  	
  The service and/or age requirements specified above shall be waived
  with respect to any Eligible Employee  who was employed on               and such Eligible Employee shall enter the
  Plan as of such date.

  

 

	
   

  	
   

  	
   

  	
  The requirements to be waived are (select one or both):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  service
  requirement (will let part-time Eligible Employees in Plan)

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  age requirement

  

 

	
   

  	
  HOWEVER, DIFFERENT ELIGIBILITY CONDITIONS WILL APPLY (select e. OR f.
  and/or g.);

  
	
   

  	
  e.

  	
  x

  	
  N/A. The options elected in a.-d. above apply for all purposes of the
  Plan.

  
	
   

  	
  f.

  	
  o

  	
  For purposes of all Employer contributions (other than Elective
  Deferrals and matching contributions).

  
	
   

  	
  g.

  	
  o

  	
  For purposes of Employer matching contributions.

  

 

	
   

  	
  If f. OR g. IS SELECTED, the following eligibility conditions apply
  for such purposes: 

  
	
   

  	
  h.

  	
  o

  	
  No age or service requirements

  
	
   

  	
  i.

  	
  o

  	
  Completion of the following service requirement which is based on
  Years of Service (or Periods of Service if the Elapsed Time Method is
  elected):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  No service requirement

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  1/2 Year of Service or Period of Service

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  1 Year of Service or Period of Service

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
                (not to exceed 1,000) Hours of Service
  within               (not to exceed 12) months from the Eligible
  Employee’s employment commencement date. If an Employee does not complete the
  stated Hours of Service during the specified time period, the Employee is
  subject to the Year of Service requirement in i.3. above.

  
	
   

  	
   

  	
   

  	
  5.

  	
  o

  	
  1 1/2 Years of Service or Periods of Service

  
	
   

  	
   

  	
   

  	
  6.

  	
  o

  	
  2 Years of Service or Periods of Service

  
	
   

  	
   

  	
   

  	
  7.

  	
  o

  	
  Other:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  (may not exceed two (2) Years of Service or Periods of Service)

  
	
   

  	
   

  	
   

  	
  NOTE:

  	
  If more  than one (1) Year of
  Service is elected 100% immediate vesting is required.

  
	
   

  	
  j.

  	
  o

  	
  Attainment of
  age:

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  No age
  requirement 

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  20 1/2

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  21

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  Other:               (may not exceed 21)

  
	
   

  	
  k.

  	
  o

  	
  The service and/or age requirements specified above shall be waived
  with respect to any Eligible Employee who was employed on               and such Eligible Employee shall enter the
  Plan as of such date.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  The requirements to be waived are (select one or both):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  service requirement (will let part-time Eligible Employees in Plan)

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  age requirement

  
									

 

	
  16.

  	
  EFFECTIVE DATE OF PARTICIPATION (Plan Section 3.2)

  
	
   

  	
  An Eligible Employee who has satisfied the eligibility requirements
  will become a Participant for all purposes of the Plan (except as elected in
  g.-p. below for Employer contributions):

  
	
   

  	
  NOTE:

  	
  If different entry dates apply to Elective Deferrals than to other
  Employer contributions, complete this part a.-f. for the Elective Deferrals
  component of the Plan.

  
	
   

  	
  a.

  	
  o

  	
  the day on which such requirements are satisfied.

  
	
   

  	
  b.

  	
  o

  	
  the first day of the month coinciding with or next following the date
  on which such requirements are satisfied.

  
	
   

  	
  c.

  	
  x

  	
  the first day of the Plan Year quarter coinciding with or next
  following the date on which such requirements are satisfied.

  
	
   

  	
  d.

  	
  o

  	
  the earlier of the first day of the seventh month or the first day of
  the Plan Year coinciding with or next following the date on which such
  requirements are satisfied.

  
	
   

  	
  e.

  	
  o

  	
  the first day of the Plan Year next following the date on which such
  requirement’s are satisfied, (Eligibility must be 1/2 Year of Service (or Period
  of Service) or less and age must be 20 1/2 or less.)

  
	
   

  	
  f.

  	
  o

  	
  other:                                                                                                                                                             ,

  
	
   

  	
   

  	
   

  	
  provided that an Eligible Employee who has satisfied the maximum age
  (21) and service requirements (one (1) Year or Period of Service) and who is
  otherwise entitled to participate, shall commence participation no later than
  the earlier of (a) 6 months after such requirements are satisfied, or (b) the
  first day of the first Plan Year after such requirements are satisfied,
  unless the Employee separates from service before such participation date.

  

 

5

 

	
   

  	
  HOWEVER, different entry dates will apply (select g. OR h. and/or i.):

  
	
   

  	
  g.

  	
  x

  	
  N/A. The options elected in a.-f. above apply for all purposes of the
  Plan.

  
	
   

  	
  h. 

  	
  o

  	
  For purposes of all Employer contributions (other than Elective
  Deferrals and matching contributions).

  
	
   

  	
  i.

  	
  o

  	
  For purposes of Employer matching contributions.

  

 

	
   

  	
  IF h. OR i. IS SELECTED, the following entry dates apply for such
  purposes (select one):

  
	
   

  	
  j.

  	
  o

  	
  the first day of the month coinciding with or next following the date
  on which such requirements are satisfied.

  
	
   

  	
  k.

  	
  o

  	
  the first day of the Plan Year quarter coinciding with or next
  following the date on which such requirements are satisfied.

  
	
   

  	
  l.

  	
  o

  	
  the first day of the Plan Year in which such requirements are
  satisfied.

  
	
   

  	
  m.

  	
  o

  	
  the first day of the Plan Year in which such requirements are
  satisfied, if such requirements are satisfied in the first 6 months of the
  Plan Year, or as of the first day of the next succeeding Plan Year if such
  requirements are satisfied in the last 6 months of the Plan Year.

  
	
   

  	
  n.

  	
  o

  	
  the earlier of the first day of the seventh month or the first day of
  the Plan Year coinciding with or next  following the date on which such requirements are satisfied.

  
	
   

  	
  o.

  	
  o

  	
  the first day of the Plan Year next following the date on which such
  requirements are satisfied. (Eligibility  must be 1/2 (or 1 1/2 if 100% immediate
  Vesting is selected) Year of Service (or Period of Service) or less and age
  must be 20 1/2 or less.)

  
	
   

  	
  p.

  	
  o

  	
  other:                                                                                                                                                             .

  
	
   

  	
   

  	
   

  	
  provided that an Eligible Employee who has satisfied the maximum age
  (21) and service requirements (one (1) Year or Period of Service (or more
  than one (1) year if full and immediate vesting)) and who is otherwise
  entitled to participate, shall commence participation no later than the
  earlier of (a) 6 months after such requirements are satisfied, or (b) the
  first day of the first Plan Year after such requirements are satisfied,
  unless the Employee separates from services before such participation date.

  

 

SERVICE

 

	
  17.

  	
  RECOGNITION OF SERVICE WITH PREDECESSOR EMPLOYER (Plan Sections 1.57
  and 1.85)

  
	
   

  	
  a.

  	
  x

  	
  No service with a predecessor Employer shall be recognized.

  
	
   

  	
  b.

  	
  o

  	
  Service with              will be recognized except as follows
  (select 1. or all that apply of 2. through 4.):

  
	
   

  	
   

  	
  1.

  	
  o

  	
  N/A. no
  limitations.

  
	
   

  	
   

  	
  2.

  	
  o

  	
  service will only be recognized for vesting purposes.

  
	
   

  	
   

  	
  3.

  	
  o

  	
  service will only be recognized for eligibility purposes.

  
	
   

  	
   

  	
  4.

  	
  o

  	
  service prior to             will not be recognized.

  
	
   

  	
   

  	
  NOTE:

  	
  If the predecessor Employer maintained this qualified Plan, then Years
  of Service (and/or Periods of Service) with such predecessor Employer shall
  be recognized pursuant to Plan Sections 1.57 and 1.85 and b.1. will apply.

  

 

	
  18.

  	
  SERVICE CREDITING METHOD (Plan Sections 1.57 and 1.85)

  
	
   

  	
  NOTE: If no elections are made in this Section, then the Hours of Service
  Method will be used and the provisions set forth in the definition of Year of Service in Plan Section 1.85 will
  apply.

  
	
   

  	
  ELAPSED TIME METHOD shall be used for the following purposes (select
  all that apply):

  
	
   

  	
  a.

  	
  x

  	
  N/A. Plan only uses the Hours of Service Method.

  
	
   

  	
  b.

  	
  o

  	
  all purposes. (If selected, skip to Question 19.)

  
	
   

  	
  c.

  	
  o

  	
  eligibility to participate.

  
	
   

  	
  d.

  	
  o

  	
  vesting.

  
	
   

  	
  e.

  	
  o

  	
  sharing in allocations or contributions.

  

 

	
   

  	
  HOURS OF SERVICE METHOD shall be used for the following purposes
  (select all that apply):  

  
	
   

  	
  f.

  	
  o

  	
  N/A. Plan only uses the Elapsed Time Method.

  
	
   

  	
  g.

  	
  x

  	
  eligibility to participate in the Plan. The eligibility computation
  period after the initial eligibility computation period shall.

  
	
   

  	
   

  	
   

  	
  1.

  	
  x

  	
  shift to the Plan Year after the initial computation period.

  	
   

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  be based on the date an Employee first performs an Hour of Service
  (initial computation period) and subsequent computation periods shall be
  based on each anniversary date thereof.

  	
   

  
	
   

  	
  h.

  	
  x

  	
  vesting. The vesting computation period shall be.

  
	
   

  	
   

  	
   

  	
  1.

  	
  x

  	
  the Plan Year.

  	
   

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  the date an Employee first performs an Hour of Service and each
  anniversary thereof.

  
	
   

  	
  i.

  	
  x

  	
  sharing in allocations or contribution (the computation period shall
  be the Plan Year).

  

 

6

 

	
  

  	
  AND, IF THE HOURS OF
  SERVICE METHOD IS BEING USED, the Hours of Service will be determined on the
  basis of the method selected below. Only one method may be selected. The
  method selected below will be applied to (select j. or k.):

  
	
   

  	
  j.

  	
  x
  

  	
  all Employees. 

  
	
   

  	
  k.

  	
  o

  	
  salaried Employees only (for hourly Employees, actual
  Hours of Service will be used).

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  ON THE BASIS OF:

  
	
   

  	
  l.

  	
  x

  	
  actual hours for which an Employee is paid or
  entitled to payment.

  
	
   

  	
  m. 

  	
  o

  	
  days worked. An Employee will be credited with ten
  (10) Hours of Service if under the Plan such Employee would be credited with
  at least one (1) Hour or Service during the day.

  
	
   

  	
  n.

  	
  o

  	
  weeks worked. An Employee will be credited with
  forty-five (45) Hours of Service if under the Plan such Employee would be
  credited with at least one (1) Hour of Service during the week.

  
	
   

  	
  o.

  	
  o

  	
  semi-monthly payroll periods worked. An Employee
  will be credited with ninety-five (95) Hours of Service if under the Plan such Employee would be credited with at least one (1) Hour
  of Service during the semi-monthly payroll period.

  
	
   

  	
  p.

  	
  o

  	
  months worked. An Employee
  will be credited with one hundred ninety (190) Hours of Service if under the
  Plan such Employee would be credited with at least one (1) Hour of Service
  during the month.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, a Year of Service
  means the applicable computation period during which an Employee has
  completed at least:

  
	
   

  	
  q.

  	
  x

  	
  1000 (may not be more than 1,000) Hours of
  Service (if left blank, the Plan will use 1,000 Hours of Service).

  
	
   

  	
   

  
	
  VESTING

  
	
   

  	
   

  
	
  19.

  	
  VESTING OF PARTICIPANT’S
  INTEREST (Plan Section 6.4(b))

  
	
   

  	
  Vesting for Employer
  Contributions (except as otherwise elected in j. – q. below for matching
  contributions). The vesting schedule, based on a Participant’s Years of
  Service (or Periods of Service if the Elapsed Time Method is elected), shall
  be as follows:

  
	
   

  	
  a.

  	
  x

  	
  100% upon entering Plan,
  (Required if eligibility requirement is greater than one (1) Year of Service
  or Period of Service.)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  b.

  	
  o

  	
  3 Year Cliff:

  	
   

  
						

 

	
  0-2 years

  	
   

  	
  0

  	
  %

  
	
  3 years

  	
   

  	
  100

  	
  %

  

 

	
   

  	
  c.

  	
  o

  	
  5 Year Cliff:

  	
   

  	
   

  	
   

  

 

	
  0-4 years

  	
   

  	
  0

  	
  %

  
	
  5 years

  	
   

  	
  100

  	
  %

  

 

	
   

  	
  d.

  	
  o

  	
  6 Year Graded:

  	
   

  

 

	
  0-1 years

  	
   

  	
  0

  	
  %

  
	
  2 years

  	
   

  	
  20

  	
  %

  
	
  3 years

  	
   

  	
  40

  	
  %

  
	
  4 years

  	
   

  	
  60

  	
  %

  
	
  5 years

  	
   

  	
  80

  	
  %

  
	
  6 years

  	
   

  	
  100

  	
  %

  

 

	
   

  	
  e.

  	
  o

  	
  4 Year Graded:

  	
   

  	
   

  	
   

  

 

	
  1 year 

  	
   

  	
  25

  	
  %

  
	
  2 years

  	
   

  	
  50

  	
  %

  
	
  3 years

  	
   

  	
  75

  	
  %

  
	
  4 years

  	
   

  	
  100

  	
  %

  

 

	
   

  	
  f.

  	
  o

  	
  5 Year Graded:

  	
   

  

 

	
  1 year 

  	
   

  	
  20

  	
  %

  
	
  2 years

  	
   

  	
  40

  	
  %

  
	
  3 years

  	
   

  	
  60

  	
  %

  
	
  4 years

  	
   

  	
  80

  	
  %

  
	
  5 years

  	
   

  	
  100

  	
  %

  

 

	
   

  	
  g.

  	
  o

  	
  7 Year Graded:

  	
   

  	
   

  	
   

  

 

	
  0-2 years

  	
   

  	
  0

  	
  %

  
	
  3 years

  	
   

  	
  20

  	
  %

  
	
  4 years

  	
   

  	
  40

  	
  %

  
	
  5 years

  	
   

  	
  60

  	
  %

  
	
  6 years

  	
   

  	
  80

  	
  %

  
	
  7 years

  	
   

  	
  100

  	
  %

  

 

	
   

  	
  h.

  	
  o

  	
  Other - Must be at least as
  liberal as either c. or g. above.

  

 

	
  Service

  	
   

  	
  Percentage

  
	
   

  	
   

  	
   

  
	
    

  	
   

  	
   

  
	
         

  	
   

  	
         

  

 

7

 

	
  

  	
  VESTING FOR EMPLOYER
  MATCHING CONTRIBUTIONS

  
	
   

  	
  The vesting schedule for
  Employer matching contributions, based on a Participant’s Years of Service
  (or Periods of Service if the Elapsed Time Method is elected) shall be as
  follows:

  
	
   

  	
  i.

  	
  x

  	
  N/A. There are no matching
  contributions subject to a vesting schedule OR the schedule in a.-h. above
  shall also  apply to matching
  contributions.

  
	
   

  	
  j.

  	
  o

  	
  100% upon entering Plan.
  (Required if eligibility requirement is greater than one (1) Year of Service
  or Period of Service.)

  
	
   

  	
  k.

  	
  o

  	
  3 Year Cliff

  
	
   

  	
  l.

  	
  o

  	
  5 Year Cliff

  
	
   

  	
  m.

  	
  o

  	
  6 Year Graded

  
	
   

  	
  n.

  	
  o

  	
  4 Year Graded

  
	
   

  	
  o.

  	
  o

  	
  5 Year Graded

  
	
   

  	
  p.

  	
  o

  	
  7 Year Graded

  
	
   

  	
  q.

  	
  o

  	
  Other - Must be at least as
  liberal as either l. or p. above.

  

 

	
  Service

  	
   

  	
  Percentage

  
	
   

  	
   

  	
   

  
	
    

  	
   

  	
   

  
	
         

  	
   

  	
         

  

 

	
  20.

  	
  FOR AMENDED PLANS (Plan
  Section 6.4(f))

  
	
   

  	
  If the  vesting schedule has been amended to a
  less favorable schedule, enter the pre-amended schedule below:

  
	
   

  	
  a.

  	
  o

  	
  Vesting schedule has not
  been amended, amended schedule is more favorable in all years or prior
  schedule was immediate 100% vesting.

  
	
   

  	
  b.

  	
  o

  	
  Pre-amended schedule:

  

 

	
  Service

  	
   

  	
  Percentage

  
	
   

  	
   

  	
   

  
	
    

  	
   

  	
   

  
	
         

  	
   

  	
         

  

 

8

 

	
  21.

  	
  TOP HEAVY
  VESTING (Plan Section 6.4(c))

  
	
   

  	
  If this Plan
  becomes a Top Heavy Plan, the following vesting schedule, based on number of
  Years of Service (or Periods of Service if the Elapsed Time Method is
  elected), shall apply and shall be treated as a Plan amendment pursuant to
  this Plan. Once effective, this schedule shall also apply to any
  contributions made before the Plan became a Top Heavy Plan and shall continue
  to apply if the Plan ceases to be a Top Heavy Plan unless an amendment is
  made to change the vesting schedule.

  

 

	
   

  	
  a.

  	
  x

  	
  N/A (the regular
  vesting schedule already satisfies one of the minimum top heavy schedules).

  
	
   

  	
  b.

  	
  o

  	
  6 Year Graded:

  

 

	
  0-1 year 

  	
   

  	
  0

  	
  %

  
	
  2 years

  	
   

  	
  20

  	
  %

  
	
  3 years

  	
   

  	
  40

  	
  %

  
	
  4 years

  	
   

  	
  60

  	
  %

  
	
  5 years

  	
   

  	
  80

  	
  %

  
	
  6 years

  	
   

  	
  100

  	
  %

  

 

	
   

  	
  c.

  	
  o

  	
  3 Year Cliff:

  	
   

  	
   

  

 

	
  0-2 years

  	
   

  	
  0

  	
  %

  
	
  3 years

  	
   

  	
  100

  	
  %

  

 

	
   

  	
  d.

  	
  o

  	
  Other - Must be
  at least as liberal as either b. or c. above.

  

 

	
  Service

  	
   

  	
  Percentage

  
	
   

  	
   

  	
   

  
	
    

  	
   

  	
   

  
	
         

  	
   

  	
         

  

 

	
   

  	
  NOTE:

  	
  This Section
  does not apply to the account balances of any Participant who does not have
  an Hour of Service after the Plan has initially become top heavy. Such
  Participant’s Account balance attributable to Employer contributions and
  Forfeitures will be determined without regard to this Section.

  

 

	
  22.

  	
  EXCLUDED VESTING
  SERVICE

  
	
   

  	
  a.

  	
  x

  	
  No exclusions.

  
	
   

  	
  b.

  	
  o

  	
  Service prior to
  the Effective Date of the Plan or a predecessor plan.

  
	
   

  	
  c.

  	
  o

  	
  Service prior to
  the time an Employee has attained age 18.

  
	
   

  	
   

  
	
  23.

  	
  VESTING FOR
  DEATH AND TOTAL AND PERMANENT DISABILITY

  

 

	
   

  	
  Regardless
  of the vesting schedule. Participants shall become fully Vested upon (select
  a. or all that apply of b. and c.)

  

 

	
   

  	
  a.

  	
  x

  	
  N/A. Apply
  vesting schedule, or all contributions to the Plan are fully Vested.

  
	
   

  	
  b.

  	
  o

  	
  Death.

  
	
   

  	
  c.

  	
  o

  	
  Total and Permanent Disability.

  
	
   

  	
   

  
	
  24.

  	
  NORMAL
  RETIREMENT AGE (“NRA”) (Plan Section 1.45) means the:

  
	
   

  	
  a.

  	
  x

  	
  date of a
  Participant’s 65 birthday (not to exceed 65th).

  

 

	
   

  	
  b.

  	
  o

  	
  later of a
  Participant’s                birthday
  (not to exceed 65th) or the                (not
  to exceed 5th) anniversary of the first day of the Plan Year in which
  participation in the Plan commenced.

  

 

	
  25.

  	
  NORMAL
  RETIREMENT DATE (Plan Section 1.46) means the:

  
	
   

  	
  a.

  	
  o

  	
  Participant’s
  “NRA”.

  
	
   

  	
  OR (select one)

  
	
   

  	
  b.

  	
  x

  	
  first day of the
  month coinciding with or next following the Participant’s “NRA”.

  
	
   

  	
  c.

  	
  o

  	
  first day of the
  month nearest the Participant’s “NRA”.

  
	
   

  	
  d.

  	
  o

  	
  Anniversary Date
  coinciding with or next following the Participant’s “NRA”.

  
	
   

  	
  e.

  	
  o

  	
  Anniversary Date
  nearest the Participant’s “NRA”.

  
	
   

  	
   

  
	
  26.

  	
  EARLY RETIREMENT
  DATE (Plan Section 1.15) means the:

  
	
   

  	
  a.

  	
  x

  	
  No Early
  Retirement provision provided.

  
	
   

  	
  b.

  	
  o

  	
  date on which
  Participant.

  
	
   

  	
  c.

  	
  o

  	
  first day of the
  month coinciding with or next following the date on which a Participant.

  
	
   

  	
  d.

  	
  o

  	
  Anniversary Date
  coinciding with or next following the date on which a Participant.

  
						

 

9

 

	
   

  	
  AND, if b. c., or d. is selected... 

  
	
   

  	
  e.

  	
  o

  	
  attains age             .

  
	
   

  	
  f.

  	
  o

  	
  attains age              and competes at least              Years of Service (or Periods of Service)
  for vesting purposes.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, if b., c. or d. is selected, shall a Participant become fully Vested
  upon attainment of the Early Retirement Date?

  
	
   

  	
  g.

  	
  o

  	
  Yes

  
	
   

  	
  h.

  	
  o

  	
  No

  
	
   

  	
   

  	
   

  	
   

  
	
  COMPENSATION

  
	
   

  	
   

  
	
  27.

  	
  COMPENSATION (Plan Section 1.11) with respect to any Participant
  means;

  
	
   

  	
  a.

  	
  x

  	
  Wages, tips and other compensation on Form W-2.

  
	
   

  	
  b.

  	
  o

  	
  Section 3401(a) wages (wages for withholding
  purposes).

  
	
   

  	
  c.

  	
  o

  	
  415 safe-harbor compensation.

  
	
   

  	
   

  
	
   

  	
  COMPENSATION shall be based on the following determination period;

  
	
   

  	
  d.

  	
  x

  	
  the Plan Year.

  
	
   

  	
  e.

  	
  o

  	
  the Fiscal Year coinciding with or ending within the Plan Year.

  
	
   

  	
  f.

  	
  o

  	
  the calendar year coinciding with or ending within the Plan Year.

  
	
   

  	
  NOTE:

  	
  The Limitation Year for Code Section 415 purposes
  shall be the same as the determination period for Compensation unless an
  alternative period is specified:             
  (must be a consecutive twelve month period).

  
	
   

  	
   

  
	
   

  	
  ADJUSTMENTS TO COMPENSATION

  
	
   

  	
  g.

  	
  o

  	
  N/A. No adjustments.

  
	
   

  	
  h.

  	
  x

  	
  Compensation shall be adjusted by: (select all that apply)

  
	
   

  	
  1.

  	
  x

  	
  including compensation which is not currently
  includible in the Participant’s gross income by reason of the application of
  Code Sections 125 (cafeteria plan). 132(f)(4) (qualified transportation
  fringe). 402(c)(3) (401(k) plan), 402(h)(1)(B) (simplified employee pension
  plan), 414(h) (employer pickup contributions under a governmental plan).
  403(b) (tax sheltered annuity) or 457(b) (eligible deferred compensation
  plan)

  
	
   

  	
  2.

  	
  x

  	
  excluding reimbursements or other expense
  allowances, fringe benefits (cash or non-cash), moving expenses, deferred
  compensation (other than deferrals specified in 1. above) and welfare
  benefits

  
	
   

  	
  3.

  	
  x

  	
  excluding Compensation paid during the determination
  period while not a Participant in the component of the Plan for which the
  definition is being used

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  HOWEVER, FOR SALARY DEFERRAL AND MATCHING PURPOSES Compensation shall
  be adjusted by (for salary deferral purposes the Plan automatically includes
  amounts in h.l. above):

  
	
   

  	
  i.

  	
  o

  	
  N/A. No adjustments or same adjustments as  in above

  
	
   

  	
  j.

  	
  x

  	
  Compensation shall be adjusted by: (select all that apply)

  
	
   

  	
  1.

  	
  x

  	
  excluding reimbursements or other expense
  allowances, fringe benefits (cash or non-cash), moving expenses, deferred
  compensation (other than deferrals specified in h.l. above) and welfare
  benefits

  
	
   

  	
  2.

  	
  x

  	
  excluding Compensation paid during the determination period while not
  a Participant in the component of the Plan for which the definition is being
  used

  
	
   

  	
   

  	
   

  	
   

  
	
  CONTRIBUTIONS AND ALLOCATIONS

  
	
   

  	
   

  	
   

  	
   

  
	
  28.

  	
  SALARY REDUCTION ARRANGEMENT - ELECTIVE DEFERRALS (Plan Section 12.2)

  Each Participant may elect to have Compensation deferred by:

  
	
   

  	
  a.

  	
  o

  	
          %.

  
	
   

  	
  b.

  	
  o

  	
  up to         %.

  
	
   

  	
  c.

  	
  o

  	
  from         %
  to         %.

  
	
   

  	
  d.

  	
  x

  	
  up to the maximum percentage allowable not to exceed the limits of
  Code Sections 401(k), 402(g), 404 and 415.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, Participants who are Highly Compensated Employees determined as
  of the beginning of  a Plan Year
  may only elect to defer Compensation by:

  
	
   

  	
  e.

  	
  x

  	
  Same limits as specified above.

  
								

 

	
   

  	
  f.

  	
  o

  	
  The
  percentage equal to the deferral limit in effect under Code Section 402(g)(3)
  for the calendar year that begins with or within the Plan Year divided by the
  annual compensation limit in effect for the Plan Year under Code Section
  401(a)(17).

  

 

	
   

  	
  MAY PARTICIPANTS make a special salary deferral election with respect
  to bonuses?

  
	
   

  	
  g.

  	
  x

  	
  No.

  
	
   

  	
  h.

  	
  o

  	
  Yes, a Participant may elect to defer up to        % of any bonus.

  

 

10

 

	
   

  	
  PARTICIPANTS MAY commence
  salary deferrals on the effective date of participation and on January 1st, April 1st July 1st and October 1st
  (must be at least once each calendar year).

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Participants may modify
  salary deferral elections:

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  As of each payroll period

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  On the first day of the month

  
	
   

  	
   

  	
   

  	
  3.

  	
  x

  	
  On the first day of each  Plan Year quarter

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  On the first day  of
  the Plan Year or the first day of the 7th month of the Plan Year

  
	
   

  	
   

  	
   

  	
  5.

  	
  o

  	
  Other:          (must be at
  least once each calendar year)

  

 

	
   

  	
  AUTOMATIC ELECTION: Shall Participants who do not
  affirmatively elect to receive cash or have a specified amount contributed to
  the Plan automatically have Compensation deferred?

  
	
   

  	
  i.

  	
  x

  	
  No.

  
	
   

  	
  j.

  	
  o

  	
  Yes, by          % of Compensation.

  

 

	
   

  	
  SHALL THERE BE a special
  effective date for the salary deferral component of the Plan?

  
	
   

  	
  k.

  	
  x

  	
  No.

  
	
   

  	
  l.

  	
  o

  	
  Yes, the effective date of
  the salary deferral component or the Plan is             (enter month day, year).

  

 

	
  29.

  	
  SIMPLE 401(k) PLAN ELECTION (Plan Section 13.1)

  
	
   

  	
  Shall the simple 401(k) provisions of Article XIII
  apply?

  
	
   

  	
  a.

  	
  x

  	
  No. The simple 401(k)
  provisions will not apply.

  
	
   

  	
  b.

  	
  o

  	
  Yes, The simple 401(k)
  provisions will apply.

  

 

	
  30.

  	
  401(k) SAFE HARBOR
  PROVISIONS (Plan Section 12.8)

  
	
   

  	
  Will the ADP and/or ACP
  test safe harbor provisions be used? (select a, b, or c.)

  
	
   

  	
  a.

  	
  o

  	
  No, (If selected, skip to
  Question 31.)

  
	
   

  	
  b.

  	
  o

  	
  Yes, but only the ADP (and
  NOT the ACP) Test Safe Harbor provisions will be  used.

  
	
   

  	
  c.

  	
  x

  	
  Yes, both the ADP and  ACP Test Safe Harbor provisions will be
  used.

  

 

	
   

  	
   

  	
   

  	
  IF c. is selected, does the
  Plan permit matching contributions in addition to any safe harbor
  contributions elected in d. or e. below?

  
	
   

  	
   

  	
   

  	
  1.

  	
  x

  	
  No or N/A.
  Any matching contributions, other than any Safe Harbor Matching Contributions
  elected in d. below, will be suspended in any Plan Year in which the safe
  harbor provisions are used.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  Yes, the Employer may make
  matching contributions in addition to any Safe Harbor Matching contributions
  elected in d. below. (If elected, complete the provisions of the Adoption
  Agreement relating to matching contributions (i.e., Questions 31. and 32.)
  that will apply in addition to any elections made in d. below, NOTE:
  Regardless of any election made in Question 31., the Plan automatically
  provides that only Elective Deferrals up to 6%  of Compensation are taken into account in applying the
  match set forth in that Question and that the maximum discretionary matching
  contribution that may be made on behalf of any Participant is 4% of
  Compensation.)

  

 

	
   

  	
  THE EMPLOYER WILL MAKE THE
  FOLLOWING ADP TEST SAFE HARBOR CONTRIBUTION FOR THE PLAN YEAR:

  
	
   

  	
  NOTE:

  	
  The ACP Test Safe Harbor is
  automatically satisfied if the only matching contribution made to the Plan is
  either (1) a Basic Matching Contribution or (2) an Enhanced Matching
  Contribution that does not provide a match on Elective Deferrals in excess of
  6% of Compensation.

  

 

	
   

  	
  d.

  	
  x

  	
  Safe Harbor Matching
  Contribution (select l. or 2. AND 3.)

  
	
   

  	
   

  	
   

  	
  1.

  	
  x

  	
  Basic
  Matching Contribution.
  The Employer will make Matching Contributions to the account of each
  “Eligible Participant” in an amount equal to the sum of 100% of the amount of
  the Participant’s Elective Deferrals that do not exceed 3% of the
  Participant’s Compensation, plus 50% of the amount of the Participant’s
  Elective Deferrals that exceed 3% of the Participant’s Compensation but do
  not exceed 5% of the Participant’s Compensation.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  Enhanced
  Matching Contribution.
  The Employer will make Matching Contributions to the account of each
  “Eligible Participant” in an amount equal to the sum of:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  a.

  	
  o

  	
              % (may not be less than 100%) of the
  Participant’s Elective Deferrals that do not exceed             % (if over 6% or if left blank, the ACP test
  will still apply) of the Participant’s Compensation, plus

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  b.

  	
  o

  	
              % of the Participant’s Elective Deferrals
  that exceed            % of the Participant’s Compensation but do
  not exceed            % (if over 6% or if left  blank, the ACP test will still apply)
  of the Participant’s Compensation.

  

 

11

 

	
   

  	
   

  	
   

  	
   

  	
   

  	
  NOTE:

  	
  a. and b. must be completed
  so that, at any rate of Elective Deferrals, the matching contribution is at
  least equal to the matching contribution receivable if the Employer were
  making Basic Matching Contributions, but the rate of match cannot increase as
  deferrals increase. For example, if a. is completed to provide a match equal
  to 100% of deferrals up to 4% of Compensation, then b. need not be completed.

  
	
   

  	
   

  	
   

  	
  3.

  	
  x

  	
  The safe harbor matching
  contribution will be determined on the following basis (and Compensation for
  such purpose will be based on the applicable period):

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  a.

  	
  o

  	
  the entire Plan Year.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  b.

  	
  x

  	
  each payroll period.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  c.

  	
  o

  	
  all payroll periods ending
  with or within each month.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  d.

  	
  o

  	
  all payroll periods ending
  with or within the Plan Year quarter.

  
	
   

  	
  e.

  	
  o

  	
  Nonelective Safe Harbor
  Contributions (select one)

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  The Employer will make a
  Safe Harbor Nonelective Contribution to the account of each “Eligible
  Participant” in an amount equal to             %
  (may not be less than 3%) of the Employee’s Compensation for the Plan Year.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  The Employer will make a
  Safe Harbor Nonelective Contribution to another defined contribution plan
  maintained by the Employer (specify the name of the other plan):             .

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  FOR PURPOSES OF THE ADP
  Test Safe Harbor contribution, the term “Eligible Participant” means any
  Participant who is eligible to make Elective Deferrals with the following
  exclusions:

  
	
   

  	
  f.

  	
  o

  	
  Highly Compensated
  Employees.

  
	
   

  	
  g.

  	
  o

  	
  Employees who have not
  satisfied the greatest minimum age and service conditions permitted under
  Code Section 410(a).

  
	
   

  	
  h.

  	
  o

  	
  Other:                                                                                                                                                   
  (must be a category that could be excluded under the permissive or mandatory
  disaggregation rules of Regulations 1.401 (k)-1(b)(3) and 1.401(m)-1(b)(3)).

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SPECIAL EFFECTIVE DATE OF
  ADP AND ACP TEST SAFE HARBOR PROVISIONS

  
	
   

  	
  i.

  	
  x

  	
  N/A. The safe harbor provisions
  are effective as of the later of the Effective Date of this Plan or, if this
  is an amendment or restatement, the effective date of the amendment or
  restatement.

  
	
   

  	
  j.

  	
  o

  	
  The ADP and ACP Test Safe
  Harbor provisions are effective for the Plan Year beginning:

  
	
   

  	
   

  	
   

  	
                                                                                              (enter the first day of the Plan Year
  for which the provisions are (or, for GUST updates, were) effective and, if
  necessary, enter any other special effective dates that apply with respect to
  the provisions).

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  31.

  	
  FORMULA FOR DETERMINING
  EMPLOYER MATCHING CONTRIBUTIONS (Plan Section 12.1(a)(2))

  
	
   

  	
  NOTE:

  	
  Regardless of any election
  below, if the ACP test safe harbor is being used (i.e., Question 30.c. is
  selected), then the Plan automatically provides that only Elective Deferrals
  up to 6% of Compensation are taken into account in applying the match set
  forth below and that the maximum discretionary matching contribution that may
  be made on behalf of any Participant is 4% of Compensation.

  
	
   

  	
  a.

  	
  x

  	
  N/A. There will not be any
  matching contributions (Skip to Question 33).

  
	
   

  	
  b.

  	
  o

  	
  The Employer... (select 1,
  or 2.)

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  may make matching
  contributions equal to a discretionary percentage, to be determined by the
  Employer, of the Participant’s Elective Deferrals.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  will make matching
  contributions equal to           %
  (e.g., 50) of the Participant’s Elective Deferrals, plus:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  a.

  	
  o

  	
  N/A.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  b.

  	
  o

  	
  an additional discretionary
  percentage, to be determined by the Employer.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  AND, in determining the matching contribution
  above, only Elective Deferrals up to the percentage or dollar amount
  specified below will be matched: 

  (select 3. and/or 4.OR 5.)

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
                  % of a Participant’s Compensation.

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  $                .

  
	
   

  	
   

  	
   

  	
  5.

  	
  o

  	
  a discretionary percentage
  of a Participant’s Compensation or a discretionary dollar amount, the
  percentage or dollar amount to be determined by the Employer on a uniform
  basis to all Participants.

  
	
   

  	
  c.

  	
  o

  	
  The Employer may make
  matching contributions equal to a discretionary percentage, to be determined
  by the Employer, of each tier, to be determined by the Employer, of the
  Participant’s Elective Deferrals.

  
	
   

  	
  d.

  	
  o

  	
  The Employer will make
  matching contributions equal to the sum of          %
  of the portion of the Participant’s Elective Deferrals which do not exceed             %
  of the Participant’s Compensation or $                plus           % of the
  portion of the Participant’s Elective Deferrals which exceed           %
  of the Participant’s Compensation or $            ,
  but does not exceed               %
  of the Participant’s Compensation or $              .
  

  
	
   

  	
  NOTE:

  	
  If c. or d. above is
  elected, the rate of matching contributions must decrease as a Participant’s
  Elective Deferrals or Years of Service (or Periods of Service) increase.

  
										

 

12

 

	
   

  	
  PERIOD OF DETERMINING MATCHING CONTRIBUTIONS

  
	
   

  	
  Matching contributions will be determined on the following basis (and
  any Compensation or dollar limitation used in determining the match will be
  based on the applicable period):

  
	
   

  	
  e.

  	
  o

  	
  the entire Plan Year.

  
	
   

  	
  f.

  	
  o

  	
  each payroll period.

  
	
   

  	
  g.

  	
  o

  	
  all payroll periods ending within each month.

  
	
   

  	
  h.

  	
  o

  	
  all payroll periods ending with or within the Plan Year quarter.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  THE MATCHING CONTRIBUTION MADE ON BEHALF OF ANY PARTICIPANT for any
  Plan Year will not exceed:

  
	
   

  	
  i.

  	
  o

  	
  N/A.

  
	
   

  	
  j.

  	
  o

  	
  $                    .

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MATCHING CONTRIBUTIONS WILL BE MADE ON BEHALF OF:

  
	
   

  	
  k.

  	
  o

  	
  all Participants.

  
	
   

  	
  l.

  	
  o

  	
  only Non-Highly Compensated Employees.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SHALL THE MATCHING CONTRIBUTIONS BE QUALIFIED MATCHING CONTRIBUTIONS?

  
	
   

  	
  m.

  	
  o

  	
  Yes. If elected, ALL matching contributions will be fully Vested and
  will be subject to restrictions on withdrawals. In addition, Qualified
  Matching Contributions may be used in either the ADP or ACP test.

  
	
   

  	
  n.

  	
  o

  	
  No.

  
	
   

  	
   

  	
   

  	
   

  
	
  32.

  	
  ONLY PARTICIPANTS WHO SATISFY THE FOLLOWING CONDITIONS WILL BE
  ELIGIBLE TO SHARE IN THE ALLOCATION OF MATCHING CONTRIBUTIONS:

  
	
   

  	
   

  
	
   

  	
  REQUIREMENTS FOR PARTICIPANTS WHO ARE ACTIVELY EMPLOYED AT THE END OF
  THE PLAN YEAR: Participants who are actively employed at the end of the Plan
  Year will share in allocations regardless of the service completed during
  such Plan Year.

  
	
   

  	
   

  
	
   

  	
  REQUIREMENTS FOR PARTICIPANTS WHO ARE NOT ACTIVELY EMPLOYED AT THE END
  OF THE PLAN YEAR (except as provided in c. through e. below)

  
	
   

  	
  a.

  	
  o

  	
  A Participant must complete more than                 
  Hours of Service (not more than 500) or, if the Elapsed Time Method is
  elected.                     
  months of service (not more than there (3)).

  
	
   

  	
  b.

  	
  o

  	
  Participants will share in such allocations, regardless of service.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PARTICIPANTS WHO ARE NOT ACTIVELY EMPLOYED AT THE END OF THE PLAN YEAR
  due to the following
  shall be eligible to share in the allocation of matching contributions
  regardless of the above conditions (select all that apply):

  
	
   

  	
  c.

  	
  o

  	
  Death.

  
	
   

  	
  d.

  	
  o

  	
  Total and Permanent Disability.

  
	
   

  	
  e.

  	
  o

  	
  Early or Normal Retirement.

  
	
   

  	
   

  	
   

  	
   

  
	
  33.

  	
  FORMULA FOR DETERMINING EMPLOYER’S PROFIT SHARING CONTRIBUTION (Plan
  Section 12.1(a)(3))

  
	
   

  	
  a.

  	
  x

  	
  N/A. No Employer Profit Sharing Contributions may be made (other than
  top heavy minimum contributions) (Skip to Question 34.)

  
	
   

  	
  b.

  	
  o

  	
  Discretionary, to be determined by the Employer, not limited to
  current or accumulated Net Profits.

  
	
   

  	
  c.

  	
  o

  	
  Discretionary, to be determined by the Employer, out of current or
  accumulated Net Profits.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  CONTRIBUTION ALLOCATIONS  

  If b. or c. above is selected, the Employer’s discretionary profit sharing
  contribution for a Plan Year will be allocated as follows:

  
	
   

  	
   

  
	
   

  	
  d.

  	
  o

  	
  NON-INTEGRATED ALLOCATION

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  In the same ratio as each Participant’s Compensation bears to the
  total of such Compensation of all Participants.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  In the same dollar amount to all Participants (per capita).

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  In the same dollar amount per Hour of Service completed by each
  Participant.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  e.

  	
  o

  	
  INTEGRATED ALLOCATION

  In accordance with Plan Section 4.3(b)(2). based on a Participant’s
  Compensation in excess of:

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  The Taxable Wage Base.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
                    
  % (not to exceed 100%) of the Taxable Wage Base. (See Note below)

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  80% of the Taxable Wage Base plus $1,00.

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  $                (not greater than the Taxable Wage Base). (See Note below)

  

 

13

 

	
   

  	
   

  	
   

  	
  NOTE: 

  	
  The integration percentage of 5.7% shall be reduced to:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  1.

  	
  4.3% if 2. or 4, above is more than 20% and less than or equal to 80%
  of the Taxable Wage Base.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  2.

  	
  5.4% if 3. is elected or if 2. or 4,above is more than 80% of the Taxable Wage Base.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  34.

  	
  QUALIFIED NON-ELECTIVE CONTRIBUTIONS (Plan Section 12.l(a)(4))

  
	
   

  	
  NOTE:

  	
  Regardless of any election made in this Question, the Plan
  automatically permits Qualified Non-Elective Contributions to correct a
  failed ADP or ACP test.

  
	
   

  	
  a.

  	
  x

  	
  N/A. There will be no additional Qualified Non-Elective Contributions
  except as otherwise provided in the Plan.

  
	
   

  	
  b.

  	
  o

  	
  The Employer will make a Qualified Non-Elective Contribution equal to      %
  of the total Compensation of those Participants eligible to Share in the
  allocations.

  
	
   

  	
  c.

  	
  o

  	
  The Employer may make a Qualified Non-Elective Contribution in an
  amount to be determined by the Employer, to be allocated in proportion to the
  Compensation of those Participants eligible to share in the allocations.

  
	
   

  	
  d.

  	
  o

  	
  The Employer may make a Qualified Non-Elective Contribution in an
  amount to be determined by the Employer, to be allocated equally to  all Participants eligible to share in
  the allocations (per capita).

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, if b., c. or d. is selected, the Qualified Non-Elective Contributions
  above will be made on behalf of:

  
	
   

  	
  e.

  	
  o

  	
  all Participants.

  
	
   

  	
  f.

  	
  o

  	
  only Non-Highly Compensated Employees.

  
	
   

  	
   

  	
   

  	
   

  
	
  35.

  	
  REQUIREMENTS TO SHARE IN ALLOCATIONS OF EMPLOYER DISCRETIONARY PROFIT
  SHARING CONTRIBUTION, QUALIFIED NON-ELECTIVE CONTRIBUTIONS (other than
  Qualified Non-Elective Contributions under Plan Sections l2.5(c) and 12.7(g))
  AND FORFEITURES

  
	
   

  	
   

  
	
   

  	
  REQUIREMENTS FOR PARTICIPANTS WHO ARE ACTIVELY EMPLOYED AT THE END OF
  THE PLAN YEAR: Participants who are actively employed at the end of the Plan
  Year will share in allocations regardless of the service completed during
  such Plan Year.

  
	
   

  	
   

  
	
   

  	
  REQUIREMENTS FOR PARTICIPANTS WHO ARE NOT ACTIVELY EMPLOYED AT THE END
  OF THE PLAN YEAR (except as provided in d. through f. below)

  
	
   

  	
  a.

  	
  x

  	
  N/A. Plan does not permit such contributions and all contributions
  under the Plan are fully Vested.

  
	
   

  	
  b.

  	
  o

  	
  A Participant must complete more than         
  Hours of Service (not more than 500) (or      
  months of service (not more than three (3)) if the Elapsed Time Method is
  elected).

  
	
   

  	
  c.

  	
  o

  	
  Participants will share in such allocations, regardless of service.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PARTICIPANTS WHO ARE NOT ACTIVELY EMPLOYED AT THE END OF THE PLAN YEAR
  due to the following will be eligible to share in the allocations regardless
  of the above conditions (select all that apply):

  
	
   

  	
  d.

  	
  o

  	
  Death.

  
	
   

  	
  e.

  	
  o

  	
  Total and Permanent Disability.

  
	
   

  	
  f.

  	
  o

  	
  Early or Normal Retirement.

  
	
   

  	
   

  	
   

  	
   

  
	
  36.

  	
  FORFEITURES (Plan Sections 1.27 and 4.3(e))

  
	
   

  	
  Except as provided in Plan  Section
  1.27, a Forfeiture will occur (if no election is made, a. will apply):

  
	
   

  	
  a.

  	
  x

  	
  as of the earlier of (l) the last day of the Plan Year in which the
  Former Participant incurs five (5) consecutive 1-Year Breaks in Service, or
  (2) the distribution of the entire Vested portion of the Participant’s
  Account.

  
	
   

  	
  b.

  	
  o

  	
  as of the last day of the Plan Year in which the Former Participant
  incurs five (5) consecutive 1-Year Breaks in Service.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Will Forfeitures first be used to pay any administrative expenses?

  
	
   

  	
  c.

  	
  o

  	
  Yes.

  
	
   

  	
  d.

  	
  x

  	
  No.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, EXCEPT as otherwise provided below with respect to Forfeitures
  attributable to matching contributions, any remaining Forfeitures will be...

  
	
   

  	
  e.

  	
  o

  	
  added to any Employer discretionary contribution.

  
	
   

  	
  f.

  	
  x

  	
  used to reduce any Employer contribution.

  
	
   

  	
  g.

  	
  o

  	
  added to any Employer matching contribution and allocated as an
  additional matching contribution.

  
	
   

  	
  h.

  	
  o

  	
  allocated to all Participants eligible to share in the allocations in
  the same proportion that each Participant’s Compensation for the Plan Year
  bears to  the Compensation of all
  Participants for such year.

  

 

14

 

	
  FORFEITURES
  OF MATCHING CONTRIBUTIONS WILL BE...

  
	
   

  	
  i

  	
  x

  	
  N/A. Same as above or no
  matching contributions.

  
	
   

  	
  j.

  	
  o

  	
  used to reduce the Employer’s
  matching contribution.

  
	
   

  	
  k.

  	
  o

  	
  added to any Employer
  matching contribution and allocated as an additional matching contribution.

  
	
   

  	
  l.

  	
  o

  	
  added to any Employer
  discretionary profit sharing contribution.

  
	
   

  	
  m.

  	
  o

  	
  allocated to all
  Participants eligible to share in the matching allocations (regardless of
  whether a Participant elected any salary reductions) in proportion to each
  such Participant’s Compensation for the year.

  
	
   

  	
  n.

  	
  o

  	
  allocated to all Non-Highly
  Compensated Employees eligible to share in the matching allocations
  (regardless of whether a Participant elected any salary reductions) in
  proportion to each such Participant’s Compensation for the year.

  

 

	
  37.

  	
  ALLOCATIONS OF EARNINGS
  (Plan Section 4.3(c))

  
	
   

  	
  Allocations of earnings
  with respect to amounts which are not subject to Participant directed
  investments and which are contributed to the Plan after the previous
  Valuation Date will be determined...

  
	
   

  	
  a.

  	
  x

  	
  N/A. All assets in the Plan
  are subject to Participant investment direction.

  
	
   

  	
  b.

  	
  o

  	
  by using a weighted average
  based on the amount of time that has passed between the date a contribution
  or distribution  was made and the
  date of the prior Valuation Date.

  
	
   

  	
  c.

  	
  o

  	
  by treating one-half of all
  such contributions as being a part of the Participant’s nonsegregated account
  balance as of the previous Valuation Date.

  
	
   

  	
  d.

  	
  o

  	
  by using the method
  specified in Plan Section 4.3(c) (balance forward method).

  
	
   

  	
  e.

  	
  o

  	
  other:

  	
   

  
	
   

  	
   

  	
   

  	
  (must be a definite
  predetermined formula that is not based on Compensation and that satisfies
  the nondiscrimination requirements of Regulation 1.401 (a)(4)-4 and is
  applied uniformly to all Participants).

  

 

	
  38.

  	
  LIMITATIONS ON ALLOCATIONS
  (Plan Section 4.4)

  
	
   

  	
  If any Participant is
  covered under another qualified defined contribution plan maintained by the
  Employer, other than a Master or Prototype Plan, or if the Employer maintains
  a welfare benefit fund, as defined in Code Section 419(c), or an individual
  medical account, as defined in Code Section 415(1)(2), under which amounts
  are treated as Annual Additions with respect to any Participant in this Plan:

  
	
   

  	
  a.

  	
  x

  	
  N/A. The Employer does not
  maintain another qualified defined contribution plan other than a paired
  plan.

  
	
   

  	
  b.

  	
  o

  	
  The provisions of Plan
  Section 4.4(b) will apply as if the other plan were a Master or Prototype
  Plan.

  	 

	
   

  	
  c.

  	
  o

  	
  Specify the method under
  which the plans will limit total Annual Additions to the Maximum Permissible
  Amount, and will properly reduce any Excess Amounts, in a manner that
  precludes Employer discretion:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  NOTE:

  	
  If b. or c. is selected, an
  Employer may not rely on the opinion letter issued by the Internal Revenue
  Service that this Plan is qualified under Code Section 401.

  
	
   

  	
   

  	
   

  
	
   

  	
  IF ANY PARTICIPANT is a
  Participant in a qualified defined benefit plan maintained by the Employer:

  
	
   

  	
  d.

  	
  o

  	
  N/A. The Employer does not
  maintain, and has never maintained, a qualified defined benefit plan OR the
  provisions of  Code Section
  415(c) no longer apply to the Plan.

  
	
   

  	
  e.

  	
  x

  	
  N/A. The provisions of Code
  Section 415(c) no longer apply to this Plan effective with respect to
  Limitation Years beginning after December 31, 1999, or if later          
  (if a later date is entered, this Plan will not be considered a  safe harbor plan under Code Section
  401(a)(4) and the Regulations thereunder).

  
	
   

  	
  f.

  	
  o

  	
  In any Limitation Year, the
  Annual Additions credited to the Participant under this Plan may not cause
  the sum of the Defined Benefit. Plan Fraction and the Defined Contribution
  Fraction to exceed 1.0. If the Employer’s contribution that would  otherwise be made on the Participant’s
  behalf during the Limitation Year would cause the 1.0 limitation to be
  exceeded, the rate of contribution under this Plan will be reduced so that
  the sum of the fractions equals 1.0. If the 1.0 limitation is exceeded
  because of an Excess Amount, such Excess Amount will be reduced in accordance
  with Section 4.5 of the Plan.

  
	
   

  	
  g.

  	
  o

  	
  Specify the method under
  which the plans involved will satisfy the 1.0 limitation in a manner that
  precludes Employer
  discretion:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  NOTE:

  	
  If f. or g. is selected, an  Employer may not rely on the opinion
  letter  issued by the Internal Revenue
  Service that this Plan is qualified under Code Section 401.

  

 

15

 

	
  DISTRIBUTIONS

  	 

	
   

  	
   

  
	
  39.

  	
  FORM OF DISTRIBUTIONS (Plan
  Sections 6.5 and 6.6)

  
	
   

  	
  Distributions under
  the  Plan may be made in (select all
  that apply)...

  
	
   

  	
  a.

  	
  x

  	
  lump-sums.

  
	
   

  	
  b.

  	
  x

  	
  substantially equal
  installments.

  
	
   

  	
  c.

  	
  o

  	
  partial withdrawals
  provided the minimum withdrawal) is $            .

  
					

 

	
   

  	
  AND, pursuant to Plan
  Section 6.12.

  

 

	
       

  	
  d.

  	
  x

  	
  no  annuities  are  allowed  (Plan  Section  6.12(b)  will  apply  and  the  joint  and  survivor  rules  of  Code  

  Sections  401(a)(11)  and  417  will  not  apply  to  the  Plan).

  

 

	
   

  	
   

  	
   

  	
  AND, if this is an amendment that is eliminating
  annuities, then an annuity form of payment is not available with respect to
  distributions that have an Annuity Starting Date beginning on or after:

  

 

	
   

  	
   

  	
   

  	
  1.

  	
  x

  	
  N/A

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
            
  (may not be retroactive date), except that regardless of the date entered,
  the amendment will not be effective prior to the time set forth in Plan
  Section 8.1(c).

  

 

	
       

  	
  e.

  	
  o

  	
  annuities  are  allowed  as  the  normal  form  of  distribution  (Plan  Section  6.12  will  not  apply  and  the  joint  and  

  survivor  rules  of  Code  Sections  401(a)(11)  and  417  will  automatically  apply).  If  elected,  the  Pre-Retirement  

  Survivor  Annuity  (minimum  spouse’s  death  benefit)  will  be  equal  to:

  

 

	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  100% of Participant’s
  interest in the Plan.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  50% of Participant’s
  interest in the Plan.

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
            %
  (may not be less than 50%) of a Participant’s interest in the Plan.

  

 

	
   

  	
   

  	
   

  	
  AND, the normal form of the Qualified Joint and
  Survivor Annuity will be joint and 50% survivor annuity unless otherwise
  elected below:

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  N/A.

  
	
   

  	
   

  	
   

  	
  5.

  	
  o

  	
  Joint and 100% survivor
  annuity.

  
	
   

  	
   

  	
   

  	
  6.

  	
  o

  	
  Joint and 75% survivor
  annuity.

  
	
   

  	
   

  	
   

  	
  7.

  	
  o

  	
  Joint and 66 2/3  %
  survivor annuity.

  

 

	
   

  	
  NOTE:

  	
  If only a portion the Plan
  assets may be distributed in an annuity form of payment, then select d. AND
  c. and the assets subject to the joint and survivor annuity provisions will
  be those assets attributable to (specify):           
  (e.g., the money purchase pension plan that was merged into this plan).

  

 

	
   

  	
  AND, distributions may be
  made in...

  
	
   

  	
  f.

  	
  o

  	
  cash only (except for
  insurance or annuity contracts).

  
	
   

  	
  g.

  	
  x

  	
  cash or property.

  

 

	
  40.

  	
  CONDITIONS FOR
  DISTRIBUTIONS UPON TERMINATION OF EMPLOYMENT

  
	
   

  	
  Distributions upon
  termination of employment pursuant to Plan Section 6.4(a) of the Plan will
  not be made unless the  following
  conditions have been satisfied:

  
	
   

  	
  a.

  	
  o

  	
  No distributions may be
  made until a Participant has reached Early or Normal Retirement Date.

  
	
   

  	
  b.

  	
  x

  	
  Distributions may be made
  as soon as administratively feasible at the participant’s election.

  
	
   

  	
  c.

  	
  o

  	
  The Participant has
  incurred           
  1-Year Break(s) in Service (or Period(s) of Severance if the Elapsed Time
  Method is elected).

  
	
   

  	
  d.

  	
  o

  	
  Distributions may be made
  at the Participant’s election as soon as administratively feasible after the
  Plan Year coincident with or next following termination of employment.

  
	
   

  	
  e.

  	
  o

  	
  Distributions may be made
  at the Participant’s election as soon asadministratively feasible after the Plan year quarter coincident with
  or next following termination of employment.

  
	
   

  	
  f.

  	
  o

  	
  Distributions may be made
  at the Participant’s election as soon as administratively feasible after the
  Valuation Date coincident with or next following termination of the
  employment.

  
	
   

  	
  g.

  	
  o

  	
  Distributions may be made
  at the Participant’s election as soon as administratively feasible           
  months following terminations of employment.

  
	
   

  	
  h.

  	
  o

  	
  Other:

  	
   

  
	
   

  	
   

  	
   

  	
  (must be objective
  conditions which are ascertainable and are not subject to Employer discretion
  except as otherwise permitted in Regulation 1.411(d)-4 and may not exceed the
  limits of Code Section 401(a)(14) as set forth in Plan Section 6.7).

  

 

	
  41.

  	
  INVOLUNTARY DISTRIBUTIONS

  
	
   

  	
  Will involuntary
  distributions of amounts less than $5.000 be made in accordance with the
  provisions of Sections 6.4, 6.5 and 6.6?

  
	
   

  	
  a.

  	
  x

  	
  Yes

  
	
   

  	
  b.

  	
  o

  	
  No

  

 

16

 

	
  42.

  	
  MINIMUM DISTRIBUTION TRANSITIONAL RULES (Plan Section 6.5(c))

  
	
   

  	
  NOTE:

  	
  This Section does not apply to (1) a new Plan or (2) an amendment or
  restatement of an existing Plan that never contained the provisions of Code
  Section 401(a)(9) as in effect prior to the amendments made by the Small
  Business Job Protection Act of 1996 (SBJPA).

  
	
   

  	
  The “required beginning date” for a Participant who is not a “five
  percent (5%) owner” is:

  
	
   

  	
  a.

  	
  x

  	
  N/A. (This is a new Plan or this Plan has never included the pre-SBJPA
  provisions.)

  
	
   

  	
  b.

  	
  o

  	
  April 1st of the calendar year following the year in which the
  Participant attains age 70 1/2. (The pre-SBJPA rules will continue to apply.)

  
	
   

  	
  c.

  	
  o

  	
  April 1st of the calendar year following the later of the year in
  which the Participant attains age 70 1/2 or retires (the post-SBJPA rules),
  with the following exceptions (select one or both and if no election is made,
  both will apply effective as of January 1, 1996):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  A Participant who was  already
  receiving required minimum distributions under the pre-SBJPA rules as of                     
  (not earlier than January 1, 1996) may elect to stop receiving distributions
  and have them recommence in accordance with the post-SBJPA rules. Upon the
  recommencement of distributions, if the Plan permits annuities as a form of
  distribution then the following will apply:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  a.

  	
  o

  	
  N/A. Annuity distributions are not permitted.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  b.

  	
  o

  	
  Upon the recommencement of distributions, the original Annuity
  Starting Date will be retained.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  c.

  	
  o

  	
  Upon the recommencement of distributions, a new Annuity Starting Date
  is created.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  A Participant who had not begun receiving required minimum
  distributions as of                     
  (not earlier than January 1, 1996) may elect to defer commencement of
  distributions until retirement. The option to defer the commencement of
  distributions (i.e., to elect to receive in-service distributions upon
  attainment of age 70 1/2) will apply to all such Participants unless the
  option below is elected:

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  a.

  	
  o

  	
  N/A

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  b.

  	
  o

  	
  The in-service distribution option is eliminated with respect to
  Participants who attain age 70 1/2 in or after the calendar year that begins
  after the later of (1) December 31, 1998, or (2) the adoption date of the
  amendment and restatement to bring the Plan into compliance with SBJPA. (This
  option may only be elected if the amendment to eliminate the in-service
  distribution is adopted no later than the last day of the remedial amendment
  period that applies to the Plan for changes under SBJPA.)

  

 

	
  43.

  	
  DISTRIBUTIONS UPON DEATH (Plan Section 6.6(h))

  
	
   

  	
  Distributions upon the death of a Participant prior to receiving any
  benefits shall...

  
	
   

  	
  a.

  	
  x

  	
  be made pursuant to the election of the Participant or beneficiary.

  
	
   

  	
  b.

  	
  o

  	
  begin within 1 year of death for a designated beneficiary and be
  payable over the life (or over a period not exceeding the life expectancy) of
  such beneficiary, except that if the beneficiary is the Participant’s spouse,
  begin prior to December 31st of the year in which the Participant would have
  attained age 70 1/2.

  
	
   

  	
  c.

  	
  o

  	
  be made within 5 (or if lesser             )
  years of death for all beneficiaries.

  
	
   

  	
  d.

  	
  o

  	
  be made within 5 (or if lesser             )
  years of death for all beneficiaries, except that if the beneficiary is the
  Participant’s spouse, begin prior to December 31st of the year in which the
  Participant would have attained age 70 1/2 and be payable over the life (or
  over a period not exceeding the life expectancy) of such surviving spouse.

  

 

	
  44.

  	
  HARDSHIP DISTRIBUTIONS (Plan Sections 6.11 and/or 12.9)

  
	
   

  	
  a.

  	
  o

  	
  No hardship distributions are permitted.

  
	
   

  	
  b.

  	
  x

  	
  Hardship distributions are permitted from the following accounts
  (select all that apply):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  All accounts.

  
	
   

  	
   

  	
   

  	
  2.

  	
  x

  	
  Participant’s Elective Deferral Account.

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  Participant’s Account attributable to Employer matching contributions.

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  Participant’s Account attributable to Employer profit sharing
  contributions.

  
	
   

  	
   

  	
   

  	
  5.

  	
  x

  	
  Participant’s Rollover Account.

  
	
   

  	
   

  	
   

  	
  6.

  	
  o

  	
  Participant’s Transfer Account.

  
	
   

  	
   

  	
   

  	
  7.

  	
  o

  	
  Participant’s Voluntary Contribution Account.

  
	
   

  	
  NOTE:

  	
  Distributions from a Participant’s Elective Deferral Account are
  limited to the portion of such account attributable to such Participant’s
  Elective Deferrals (and earnings attributable thereto up to December 31, 1988).
  Hardship distributions are not permitted from a Participant’s Qualified
  Non-Elective Account (including any 401(k) Safe Harbor Contributions) or
  Qualified Matching Contribution Account.

  

 

	
   

  	
  AND, shall the safe harbor hardship rules of Plan Section 12.9 apply
  to distributions made from all accounts? (Note: The safe harbor hardship
  rules automatically apply to hardship distributions of Elective Deferrals.)

  
	
   

  	
  c.

  	
  x

  	
  No or N/A. The provisions of Plan Section 6.11 apply to hardship
  distributions from all accounts other than a Participant’s Elective Deferral
  Account.

  
	
   

  	
  d.

  	
  o

  	
  Yes. The provisions of Plan Section 12.9 apply to all hardship
  distributions.

  

 

17

 

	
   

  	
  AND, are distributions restricted to those accounts in which a
  Participant is fully Vested?

  
	
   

  	
  e.

  	
  x

  	
  Yes. distributions may only be made from accounts which are fully
  Vested.

  
	
   

  	
  f.

  	
  o

  	
  No. (If elected, the fraction at Plan Section 6.5(h) shall apply in
  determining vesting of the portion of the account balance not withdrawn).

  

 

	
   

  	
  AND, the minimum hardship distribution shall be...

  
	
   

  	
  g.

  	
  x

  	
  N/A. There is no minimum.

  
	
   

  	
  h.

  	
  o

  	
  $                    (may not exceed $1,000).

  

 

	
  45.

  	
  IN-SERVICE DISTRIBUTIONS (Plan Section 6.10)

  
	
   

  	
  a.

  	
  x

  	
  In-service distributions may not be made (except as otherwise elected
  for Hardship Distributions).

  
	
   

  	
  b.

  	
  o

  	
  In-service distributions may be made to a Participant who has not
  separated from service provided any of the following condition have been
  satisfied (select all that apply):

  
	
   

  	
   

  	
   

  	
  1.

  	
  o

  	
  the Participant has attained age               .

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  the Participant has reached Normal Retirement Age.

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  the Participant has been a  Participant
  in the Plan for at least              
  years (may not be less than five (5)).

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  the amounts being distributed have accumulated in the Plan for at
  least two (2) years.

  

 

	
   

  	
  AND, in-service distributions are permitted from the following
  accounts (select all that apply):

  
	
   

  	
  c.

  	
  o

  	
  All accounts.

  
	
   

  	
  d.

  	
  o

  	
  Participant’s Elective Deferral Account.

  
	
   

  	
  e.

  	
  o

  	
  Qualified Matching Contribution Account and portion of Participant’s
  Account attributable to Employer matching contributions.

  
	
   

  	
  f.

  	
  o

  	
  Participant’s Account attributable toEmployer profit sharing contributions.

  
	
   

  	
  g.

  	
  o

  	
  Qualified Non-Elective Contribution Account.

  
	
   

  	
  h.

  	
  o

  	
  Participant’s Rollover Account.

  
	
   

  	
  i.

  	
  o

  	
  Participant’s Transfer Account.

  
	
   

  	
  j.

  	
  o

  	
  Participant’s Voluntary Contribution Account.

  
	
   

  	
  NOTE:

  	
  Distributions from a Participant’s Elective Deferral Account.
  Qualified Matching Contribution Account and Qualified Non-Elective Account
  (including 401(k) Safe Harbor Contributions) are subject to restrictions and
  generally may not be distributed prior to age 59 1/2.

  

 

	
   

  	
  AND, are distributions restricted to those accounts in which a
  Participant is fully Vested?

  
	
   

  	
  k.

  	
  o

  	
  Yes. distributions may only be made from accounts which are fully
  Vested.

  
	
   

  	
  l.

  	
  o

  	
  No. (If elected, the fraction at Plan Section 6.5(h) will apply in
  determining vesting of the portion of the account balance not withdrawn.)

  

 

	
   

  	
  AND, the minimum distribution shall be...

  
	
   

  	
  m.

  	
  o

  	
  N/A. There is no minimum.

  
	
   

  	
  n.

  	
  o

  	
  $                    
  (may not exceed $1,000).

  

 

	
  NONDISCRIMINATION TESTING

  

 

	
  46.

  	
  HIGHLY COMPENSATED EMPLOYEE (Plan Section 1.31)

  
	
   

  	
  NOTE:

  	
  If this is a GUST restatement, complete the questions in this section
  retroactively to the first Plan Year beginning after 1996.

  
	
   

  	
   

  	
   

  
	
   

  	
  Top-Paid Group Election.
  Will the top-paid group election be made? (The election made below for the
  latest year will continue to apply to subsequent Plan  Years unless a different election is made.)

  
	
   

  	
  a.

  	
  o

  	
  Yes. for the Plan Year beginning in:                     .

  
	
   

  	
  b.

  	
  x

  	
  No. for the Plan Year beginning in: January 1, 2002.

  

 

	
   

  	
  Calendar Year Data Election. Will the calendar year data election be
  used?

  
	
   

  	
  (The election made below for the latest year will continue to apply to
  subsequent Plan Years unless a different election is made.)

  
	
   

  	
  c.

  	
  o

  	
  Yes. for the Plan Year beginning in:                     .

  
	
   

  	
  d.

  	
  x

  	
  No. for the Plan Year beginning in: January 1, 2002.

  

 

18

 

	
  47.

  	
  ADP AND ACP TESTS (Plan Sections 12.4 and 12.6). The ADP ratio and ACP
  ratio for Non-Highly Compensated Employees  will
  be based on the  following. The
  election made below for the latest year will continue to apply to subsequent
  Plan Years unless the Plan is amended to a different election.

  
	
   

  	
  a.

  	
  x

  	
  N/A. This Plan satisfies the  ADP
  Test Safe Harbor rules and there are no contributions subject to an ACP test
  or for all Plan Years beginning in or after the Effective Date of the Plan
  or, in the case of an amendment and restatement, for all Plan Years to which
  the amendment and restatement relates.

  
	
   

  	
  b.

  	
  o

  	
  PRIOR YEAR TESTING: The prior year ratio will be used for the Plan
  Year beginning in           .
  (Note: If  this election  is made for first year the Code Section 401(k)
  or 401(m) feature is added to this Plan (unless this Plan is a successor
  plan),  the amount taken  into account as the ADP and ACP of
  Non-Highly Compensated Employees for the preceding  Plan Year will be 3%.)

  
	
   

  	
  c.

  	
  o

  	
  CURRENT YEAR TESTING: The current year ratio will be used for the Plan
  Year beginning in           .

  
	
   

  	
  NOTE:

  	
  In any Plan  Year where
  the ADP Test Safe Harbor is being used but not the ACP Test Safe Harbor, then
  c. above must be used if an ACP test applies for such Plan Year.

  
	
   

  	
   

  	
   

  
	
  TOP HEAVY REQUIREMENTS

  
	
   

  	
   

  
	
  48.

  	
  TOP HEAVY  DUPLICATIONS
  (Plan  Section 4.3(i)): When a
  Non-Key Employee is a Participant in this Plan and a Defined Benefit Plan
  maintained by the Employer, indicate which method shall be utilized to avoid
  duplication of top heavy minimum benefits: (If b., c., d. or e. is elected,
  f. must be completed.)

  
	
   

  	
  a.

  	
  o

  	
  N/A. The Employer does not maintain a Defined Benefit Plan other than
  a paired plan. (Go to next Question)

  
	
   

  	
  b.

  	
  o

  	
  The full top heavy minimum will be provided in each plan (if selected,
  Plan Section 4.3(i) shall not apply).

  
	
   

  	
  c.

  	
  o

  	
  5% defined contribution minimum.

  
	
   

  	
  d.

  	
  x

  	
  2% defined benefit minimum.

  
	
   

  	
  e.

  	
  o

  	
  Specify the method under which the Plans will provide top heavy
  minimum benefits for Non-Key Employees that will preclude Employer discretion
  and avoid inadvertent omissions:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  NOTE:

  	
  If c. or d. is selected and both plans do not cover the same
  Employees, or if e. is selected, then an Employer may not rely on the opinion
  letter issued by the Internal Revenue Service that this Plan is qualified
  under Code Section 401.

  
	
   

  	
   

  	
   

  
	
   

  	
  AND, the “Present Value of Accrued Benefit” (Plan Section 9.2) for Top
  Heavy purposes shall be based on...

  
	
   

  	
  f.

  	
  x

  	
  Interest rate: 7.5%

  
	
   

  	
   

  	
   

  	
  Mortality Table: GATT Mortality Table as promulgated by Rev. Rul.
  95-6

  
	
   

  	
   

  	
   

  	
   

  
	
  49.

  	
  TOP HEAVY DUPLICATIONS (Plan Section 4.3(f)): When a Non-Key Employee  is a Participant in this Plan and
  another defined contribution plan maintained by the Employer, indicate which
  method shall be utilized to avoid duplication of top heavy minimum benefits:

  
	
   

  	
  a.

  	
  x

  	
  N/A. The Employer does not 
  maintain another qualified defined contribution plan other than a
  paired plan.

  
	
   

  	
  b.

  	
  o

  	
  The full top heavy minimum will be provided in each plan.

  
	
   

  	
  c.

  	
  o

  	
  A minimum, non-integrated contribution of 3% of each Non-Key Employee’s
  415 Compensation shall be provided in the Money Purchase Plan (or other plan
  subject to Code Section 412), where the Employer maintains two (2) or more
  non-paired Defined Contribution Plans.

  
	
   

  	
  d.

  	
  o

  	
  Specify the method under which the Plans will provide top heavy
  minimum benefits for Non-Key Employees that will preclude Employer discretion
  and avoid inadvertent omissions, including any adjustments required under
  Code Section 415:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  NOTE:

  	
  If c. is selected and both plans do not cover the same Employees, or
  if d. is selected, then an Employer may not rely on the opinion  letter  issued
  by the Internal Revenue Service that this Plan is qualified under Code
  Section 401.

  
	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  
	
   

  	
   

  
	
  50.

  	
  LOANS TO PARTICIPANTS (Plan Section 7.6) 

  
	
   

  	
  a.

  	
  o

  	
  Loans are not permitted.

  
	
   

  	
  b.

  	
  x

  	
  Loans are permitted.

  
						

 

19

 

	
   

  	
  IF loans are permitted (select all that apply)...

  
	
   

  	
  c.

  	
  x

  	
  loans will be treated as a Participant directed investment.

  
	
   

  	
  d.

  	
  o

  	
  loans will only be made for hardship or financial necessity.

  
	
   

  	
  e.

  	
  x

  	
  the minimum loan will be $1,000 (may not exceed $1,000).

  
	
   

  	
  f.

  	
  x

  	
  a Participant may only have one (1) (e.g., one (1)) loan(s)
  outstanding at any time.

  
	
   

  	
  g.

  	
  x

  	
  all outstanding loan balances will become due and
  payable in their entirely upon the occurrence of a distributable event (other
  than satisfaction of the conditions for an in-service distribution).

  
	
   

  	
  h.

  	
  x

  	
  loans will only
  be permitted from the following accounts (select all that apply):

  
	
   

  	
   

  	
   

  	
  1.

  	
  x

  	
  All accounts.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  Participant’s Elective Deferral Account.

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  Qualified Matching Contribution Account and/or
  portion of Participant’s Account attributable to Employer matching
  contributions.

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  Participant’s Account attributable to Employer profit sharing
  contributions.

  
	
   

  	
   

  	
   

  	
  5.

  	
  o

  	
  Qualified Non-Elective Contribution Account.

  
	
   

  	
   

  	
   

  	
  6.

  	
  o

  	
  Participant’s Rollover Account.

  
	
   

  	
   

  	
   

  	
  7.

  	
  o

  	
  Participant’s Transfer Account.

  
	
   

  	
   

  	
   

  	
  8.

  	
  o

  	
  Participant’s Voluntary Contribution Account.

  
	
   

  	
  NOTE:

  	
  Department of Labor Regulations require the adoption of a separate
  written loan program setting forth the requirements outlined in Plan Section
  7.6.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  51.

  	
  DIRECTED INVESTMENT ACCOUNTS (Plan Section 4.10)

  
	
   

  	
  a.

  	
  o

  	
  Participant directed investments are not permitted.

  
	
   

  	
  b.

  	
  x

  	
  Participant directed investments are permitted for the following
  accounts (select all that apply):

  
	
   

  	
   

  	
   

  	
  1.

  	
  x

  	
  All accounts.

  
	
   

  	
   

  	
   

  	
  2.

  	
  o

  	
  Participant’s Elective Deferral Account.

  
	
   

  	
   

  	
   

  	
  3.

  	
  o

  	
  Qualified Matching Contribution Account and/or
  portion of Participant’s Account attributable to Employer matching
  contributions.

  
	
   

  	
   

  	
   

  	
  4.

  	
  o

  	
  Participant’s Profit Sharing Account.

  
	
   

  	
   

  	
   

  	
  5.

  	
  o

  	
  Qualified Non-Elective Contribution Account.

  
	
   

  	
   

  	
   

  	
  6.

  	
  o

  	
  Participant’s Rollover Account.

  
	
   

  	
   

  	
   

  	
  7.

  	
  o

  	
  Participant’s Transfer Account.

  
	
   

  	
   

  	
   

  	
  8.

  	
  o

  	
  Participant’s Voluntary Contribution Account.

  
	
   

  	
   

  	
   

  	
  9.

  	
  o

  	
  Other:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, is it intended that the Plan comply with Act Section 404(c) with
  respect to the accounts subject to Participant investment direction?

  
	
   

  	
  c.

  	
  x

  	
  No.

  
	
   

  	
  d.

  	
  o

  	
  Yes

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, will voting rights on directed investments be  passed through to Participants?

  
	
   

  	
  e.

  	
  x

  	
  No, Employer stock is not an alternative OR Plan is not intended to
  comply with Act Section 404(c).

  
	
   

  	
  f.

  	
  o

  	
  Yes, for Employer stock only.

  
	
   

  	
  g.

  	
  o

  	
  Yes, for all investments.

  
	
   

  	
   

  	
   

  	
   

  
	
  52.

  	
  ROLLOVERS (Plan Section 4.6)

  
	
   

  	
  a.

  	
  o

  	
  Rollovers will not be accepted by this Plan.

  
	
   

  	
  b.

  	
  x

  	
  Rollovers will be accepted by this Plan.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, if b. is elected,
  rollovers may be accepted...

  
	
   

  	
  c.

  	
  o

  	
  from any Eligible Employee, even if not a Participant.

  
	
   

  	
  d.

  	
  x

  	
  from Participants only.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  AND, distributions from a Participant’s Rollover Account may be
  made...

  
	
   

  	
  e.

  	
  o

  	
  at any time.

  
	
   

  	
  f.

  	
  x

  	
  only when the Participant is otherwise entitled to a distribution
  under the Plan.

  
	
   

  	
   

  	
   

  	
   

  
	
  53.

  	
  AFTER-TAX VOLUNTARY EMPLOYEE CONTRIBUTIONS (Plan Section 4.8) 

  
	
   

  	
  a.

  	
  x

  	
  After-tax voluntary Employee contributions will not be allowed.

  
	
   

  	
  b.

  	
  o

  	
  After-tax voluntary Employee contributions will be allowed.

  
	
   

  	
   

  	
   

  	
   

  
	
  54.

  	
  LIFE INSURANCE (Plan Section 7.5)

  
	
   

  	
  a.

  	
  x

  	
  Life insurance may not be purchased.

  
	
   

  	
  b.

  	
  o

  	
  Life insurance may be purchased at the option of the Administrator.

  
	
   

  	
  c.

  	
  o

  	
  Life insurance may be purchased  at
  the option of the Participant.

  

 

20

 

	
  AND, if b. or c. is elected, the purchase of initial or additional
  life insurance will be subject to the following limitations (select all that
  apply):

  
	
  d.

  	
  o

  	
  N/A, no limitations.

  
	
  e.

  	
  o

  	
  each initial Contract will have a minimum face amount of $          .

  
	
  f.

  	
  o

  	
  each additional Contract will have a minimum face amount of $          .

  
	
  g.

  	
  o

  	
  the Participant has completed           
  Years of Service (or Periods of Service).

  
	
  h.

  	
  o

  	
  the Participant has completed           
  Years of Service (or Periods of Service) while a Participant in the Plan.

  
	
  i.

  	
  o

  	
  the Participant is under age           
  on the Contract issue date.

  
	
  j.

  	
  o

  	
  the maximum amount of all Contracts on  behalf of a Participant may not exceed $          .

  
	
  k.

  	
  o

  	
  the maximum face amount of any life insurance Contract will be $          .

  

 

21

 

The adopting Employer may rely
on an opinion letter issued by the Internal Revenue Service as evidence that
the plan is qualified under Code Section 401 except to the extent provided in
Rev. Proc. 2000-20, 2000-6 I.R.B. 553 and Announcement 2001-77, 2001-30 I.R.B.

 

An Employer who has ever
maintained or who later adopts any plan (including  a welfare benefit fund, as defined in Code Section 419(c),
which provides post-retirement medical benefits allocated to separate accounts
for key employees, as defined in Code Section 419A(d)(3), or an individual
medical account, as  defined in
Code Section 415(1)(2)) in addition to this Plan may not rely on the opinion
letter issued by the National Office of the Internal Revenue Service with
respect to the requirements of Code Sections 415 and 416.

 

If the Employer who adopts or
maintains multiple plans wishes to obtain reliance with respect to the
requirements of Code Sections 415 and 416, application for a determination
letter must be made to Employee Plan Determinations of the Internal Revenue
Service.

 

The Employer may not rely on
the opinion letter in certain circumstances, which are specified in the opinion
letter issued with respect to the plan or in Revenue Procedure 2000-20 and
Announcement 2001-77.

 

This Adoption Agreement may
be used only in conjunction with basic Plan document #01. This Adoption
Agreement and the basic Plan document shall together be known as Morehead Plan
Administrators. Ltd. Prototype Standardized 401(k) Profit Sharing Plan and
Trust #01-006.

 

The adoption of this Plan,
its qualification by the IRS, and the related tax consequences are the
responsibility of the Employer and its independent tax and legal advisors.

 

Morehead Plan  Administrators, Ltd. will notify the
Employer of any amendments made to the  Plan
or of the discontinuance or abandonment of the Plan. Furthermore, in order to
be eligible to receive such notification, we agree to notify Morehead Plan
Administrators, Ltd. of any change in address.

 

This Plan may not be used,
and shall not be deemed to be a Prototype Plan, unless an authorized
representative of Morehead Plan Administrators, Ltd. has acknowledged the use
of the Plan. Such acknowledgment is for administerial purposes only. It
acknowledges that the Employer is using the Plan but does not represent that
this Plan, including the choices selected on the Adoption  Agreement, has been  reviewed by a representative of the sponsor
or constitutes a qualified retirement plan.

 

Morehead Plan Administrators,
Ltd.

 

	
  By:

  	
   

  	
   

  

 

With regard to any questions
regarding the provisions of the Plan, adoption of the Plan, or the effect of an
opinion letter from the IRS, call or write (this information  must be completed by the sponsor of this
Plan or its designated representative):

 

	
  Name:

  	
   

  	
  Morehead Plan Administrators, Ltd.

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Address:

  	
   

  	
  817 East Morehead Street, Suite 300

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Charlotte   North Carolina   28202

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Telephone:

  	
   

  	
  (704) 376-4420

  	
   

  	
   

  	
   

  	
   

  

 

22

 

The Employer and Trustee hereby cause this Plan to be
executed on January 1, 2002.

 

Furthermore, this Plan may
not be used unless acknowledged by Morehead Plan Administrators, Ltd. or its
authorized representative.

 

EMPLOYER:

 

BRADFORD FEDERAL SAVINGS BANK

 

	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  o

  	
  The signature of the Trustee appears on a separate
  trust agreement attached to the Plan,

  

 

OR

 

	
  /s/ Dallas
  Arthur

  	
   

  
	
  DALLAS ARTHUR

  	
  TRUSTEE

  	
   

  
				

 

	
  /s/ Cindy
  Houston

  	
   

  
	
  CINDY HOUSTON

  	
  TRUSTEE

  	
   

  
				

 

	
  /s/ Vincent
  Sortino

  	
   

  
	
  VINCENT SORTINO

  	
  TRUSTEE

  	
   

  
				

 

 

	
  PARTICIPATING EMPLOYER

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  PARTICIPATING EMPLOYER (attach additional signature pages as
  necessary):

  

 

 

	
  By:

  	
   

  	
   

  

 

23

 

Bradford
Bank

401(k)
Profit Sharing Plan

 

Plan
Document

 

 

TABLE  OF CONTENTS

 

ARTICLE I

DEFINITIONS

 

ARTICLE II

ADMINISTRATION

 

	
  2.1

  	
   

  	
  POWERS AND
  RESPONSIBILITIES OF THE EMPLOYER

  	
   

  	
  21

  	
   

  
	
  2.2

  	
   

  	
  DESIGNATION OF
  ADMINISTRATIVE AUTHORITY

  	
   

  	
  22

  	
   

  
	
  2.3

  	
   

  	
  ALLOCATION AND
  DELEGATION OF RESPONSIBILITIES

  	
   

  	
  22

  	
   

  
	
  2.4

  	
   

  	
  POWERS AND DUTIES OF
  THE ADMINISTRATOR

  	
   

  	
  22

  	
   

  
	
  2.5

  	
   

  	
  RECORDS AND REPORTS

  	
   

  	
  24

  	
   

  
	
  2.6

  	
   

  	
  APPOINTMENT OF ADVISERS

  	
   

  	
  24

  	
   

  
	
  2.7

  	
   

  	
  INFORMATION FROM
  EMPLOYER

  	
   

  	
  24

  	
   

  
	
  2.8

  	
   

  	
  PAYMENT
  OF EXPENSES

  	
   

  	
  24

  	
   

  
	
  2.9

  	
   

  	
  MAJORITY ACTIONS

  	
   

  	
  25

  	
   

  
	
  2.10

  	
   

  	
  CLAIMS PROCEDURE

  	
   

  	
  25

  	
   

  
	
  2.11

  	
   

  	
  CLAIMS REVIEW PROCEDURE

  	
   

  	
  25

  	
   

  

 

ARTICLE III

ELIGIBILITY

 

	
  3.1

  	
   

  	
  CONDITIONS OF
  ELIGIBILITY

  	
   

  	
  26

  	
   

  
	
  3.2

  	
   

  	
  EFFECTIVE DATE OF
  PARTICIPATION

  	
   

  	
  26

  	
   

  
	
  3.3

  	
   

  	
  DETERMINATION
  OF ELIGIBILITY

  	
   

  	
  27

  	
   

  
	
  3.4

  	
   

  	
  TERMINATION OF
  ELIGIBILITY

  	
   

  	
  27

  	
   

  
	
  3.5

  	
   

  	
  REHIRED EMPLOYEES AND
  BREAKS IN SERVICE

  	
   

  	
  27

  	
   

  
	
  3.6

  	
   

  	
  ELECTION NOT TO
  PARTICIPATE

  	
   

  	
  28

  	
   

  
	
  3.7

  	
   

  	
  CONTROL OF ENTITIES BY OWNER-EMPLOYEE

  	
   

  	
  28

  	
   

  

 

ARTICLE IV

CONTRIBUTION AND ALLOCATION

 

	
  4.1

  	
   

  	
  FORMULA FOR DETERMINING
  EMPLOYER’S CONTRIBUTION

  	
   

  	
  29

  	
   

  
	
  4.2

  	
   

  	
  TIME OF PAYMENT OF
  EMPLOYER’S CONTRIBUTION

  	
   

  	
  29

  	
   

  
	
  4.3

  	
   

  	
  ALLOCATION OF
  CONTRIBUTION, FORFEITURES AND EARNINGS

  	
   

  	
  30

  	
   

  
	
  4.4

  	
   

  	
  MAXIMUM ANNUAL
  ADDITIONS

  	
   

  	
  37

  	
   

  
	
  4.5

  	
   

  	
  ADJUSTMENT FOR
  EXCESSIVE ANNUAL ADDITIONS

  	
   

  	
  43

  	
   

  
	
  4.6

  	
   

  	
  ROLLOVERS

  	
   

  	
  45

  	
   

  
	
  4.7

  	
   

  	
  PLAN TO PLAN TRANSFERS
  FROM QUALIFIED PLANS

  	
   

  	
  46

  	
   

  
	
  4.8

  	
   

  	
  VOLUNTARY EMPLOYEE
  CONTRIBUTIONS

  	
   

  	
  47

  	
   

  
	
  4.9

  	
   

  	
  QUALIFIED VOLUNTARY
  EMPLOYEE CONTRIBUTIONS

  	
   

  	
  48

  	
   

  
	
  4.10

  	
   

  	
  DIRECTED INVESTMENT
  ACCOUNT

  	
   

  	
  48

  	
   

  
	
  4.11

  	
   

  	
  INTEGRATION IN MORE
  THAN ONE PLAN

  	
   

  	
  51

  	
   

  
	
  4.12

  	
   

  	
  QUALIFIED MILITARY SERVICE

  	
   

  	
  51

  	
   

  

 

i

 

ARTICLE V

VALUATIONS

 

	
  5.1

  	
   

  	
  VALUATION OF THE TRUST
  FUND

  	
   

  	
  51

  	
   

  
	
  5.2

  	
   

  	
  METHOD OF VALUATION

  	
   

  	
  52

  	
   

  

 

ARTICLE VI

DETERMINATION AND
DISTRIBUTION OF BENEFITS

 

	
  6.1

  	
   

  	
  DETERMINATION OF BENEFITS
  UPON RETIREMENT

  	
   

  	
  52

  	
   

  
	
  6.2

  	
   

  	
  DETERMINATION OF
  BENEFITS UPON DEATH

  	
   

  	
  52

  	
   

  
	
  6.3

  	
   

  	
  DETERMINATION OF
  BENEFITS IN EVENT OF DISABILITY

  	
   

  	
  54

  	
   

  
	
  6.4

  	
   

  	
  DETERMINATION OF
  BENEFITS UPON TERMINATION

  	
   

  	
  54

  	
   

  
	
  6.5

  	
   

  	
  DISTRIBUTION OF
  BENEFITS

  	
   

  	
  57

  	
   

  
	
  6.6

  	
   

  	
  DISTRIBUTION OF
  BENEFITS UPON DEATH

  	
   

  	
  64

  	
   

  
	
  6.7

  	
   

  	
  TIME OF DISTRIBUTION

  	
   

  	
  69

  	
   

  
	
  6.8

  	
   

  	
  DISTRIBUTION FOR MINOR
  OR INCOMPETENT BENEFICIARY

  	
   

  	
  69

  	
   

  
	
  6.9

  	
   

  	
  LOCATION OF PARTICIPANT
  OR BENEFICIARY UNKNOWN

  	
   

  	
  69

  	
   

  
	
  6.10

  	
   

  	
  IN-SERVICE DISTRIBUTION

  	
   

  	
  70

  	
   

  
	
  6.11

  	
   

  	
  ADVANCE DISTRIBUTION
  FOR HARDSHIP

  	
   

  	
  70

  	
   

  
	
  6.12

  	
   

  	
  SPECIAL RULE FOR
  CERTAIN PROFIT SHARING PLANS

  	
   

  	
  71

  	
   

  
	
  6.13

  	
   

  	
  QUALIFIED DOMESTIC
  RELATIONS ORDER DISTRIBUTION

  	
   

  	
  72

  	
   

  
	
  6.14

  	
   

  	
  DIRECT ROLLOVERS

  	
   

  	
  72

  	
   

  
	
  6.15

  	
   

  	
  TRANSFER OF ASSETS FROM
  A MONEY PURCHASE PLAN

  	
   

  	
  73

  	
   

  
	
  6.16

  	
   

  	
  ELECTIVE TRANSFERS OF BENEFITS TO OTHER PLANS

  	
   

  	
  73

  	
   

  

 

ARTICLE VII

TRUSTEE AND CUSTODIAN

 

	
  7.1

  	
   

  	
  BASIC RESPONSIBILITIES
  OF THE TRUSTEE

  	
   

  	
  75

  	
   

  
	
  7.2

  	
   

  	
  INVESTMENT POWERS AND
  DUTIES OF DISCRETIONARY TRUSTEE

  	
   

  	
  76

  	
   

  
	
  7.3

  	
   

  	
  INVESTMENT POWERS AND
  DUTIES OF NONDISCRETIONARY TRUSTEE

  	
   

  	
  79

  	
   

  
	
  7.4

  	
   

  	
  POWERS AND DUTIES OF
  CUSTODIAN

  	
   

  	
  82

  	
   

  
	
  7.5

  	
   

  	
  LIFE INSURANCE

  	
   

  	
  82

  	
   

  
	
  7.6

  	
   

  	
  LOANS TO PARTICIPANTS

  	
   

  	
  84

  	
   

  
	
  7.7

  	
   

  	
  MAJORITY ACTIONS

  	
   

  	
  85

  	
   

  
	
  7.8

  	
   

  	
  TRUSTEE’S COMPENSATION
  AND EXPENSES AND TAXES

  	
   

  	
  85

  	
   

  
	
  7.9

  	
   

  	
  ANNUAL REPORT OF THE
  TRUSTEE

  	
   

  	
  86

  	
   

  
	
  7.10

  	
   

  	
  AUDIT

  	
   

  	
  86

  	
   

  
	
  7.11

  	
   

  	
  RESIGNATION, REMOVAL
  AND SUCCESSION OF TRUSTEE

  	
   

  	
  87

  	
   

  
	
  7.12

  	
   

  	
  TRANSFER OF INTEREST

  	
   

  	
  88

  	
   

  
	
  7.13

  	
   

  	
  TRUSTEE INDEMNIFICATION

  	
   

  	
  88

  	
   

  
	
  7.14

  	
   

  	
  EMPLOYER SECURITIES AND REAL PROPERTY

  	
   

  	
  88

  	
   

  

 

ii

 

ARTICLE VIII

AMENDMENT,
TERMINATION AND MERGERS

 

	
  8.1

  	
   

  	
  AMENDMENT

  	
   

  	
  88

  	
   

  
	
  8.2

  	
   

  	
  TERMINATION

  	
   

  	
  90

  	
   

  
	
  8.3

  	
   

  	
  MERGER, CONSOLIDATION OR TRANSFER OF ASSETS

  	
   

  	
  90

  	
   

  

 

ARTICLE IX

TOP HEAVY PROVISIONS

 

	
  9.1

  	
   

  	
  TOP HEAVY PLAN
  REQUIREMENTS

  	
   

  	
  91

  	
   

  
	
  9.2

  	
   

  	
  DETERMINATION OF TOP HEAVY STATUS

  	
   

  	
  91

  	
   

  

 

ARTICLE X

MISCELLANEOUS

 

	
  10.1

  	
   

  	
  EMPLOYER ADOPTIONS

  	
   

  	
  93

  	
   

  
	
  10.2

  	
   

  	
  PARTICIPANT’S RIGHTS

  	
   

  	
  93

  	
   

  
	
  10.3

  	
   

  	
  ALIENATION

  	
   

  	
  94

  	
   

  
	
  10.4

  	
   

  	
  CONSTRUCTION OF PLAN

  	
   

  	
  94

  	
   

  
	
  10.5

  	
   

  	
  GENDER AND NUMBER

  	
   

  	
  95

  	
   

  
	
  10.6

  	
   

  	
  LEGAL ACTION

  	
   

  	
  95

  	
   

  
	
  10.7

  	
   

  	
  PROHIBITION AGAINST
  DIVERSION OF FUNDS

  	
   

  	
  95

  	
   

  
	
  10.8

  	
   

  	
  EMPLOYER’S AND
  TRUSTEE’S PROTECTIVE CLAUSE

  	
   

  	
  96

  	
   

  
	
  10.9

  	
   

  	
  INSURER’S PROTECTIVE
  CLAUSE

  	
   

  	
  96

  	
   

  
	
  10.10

  	
   

  	
  RECEIPT AND RELEASE FOR
  PAYMENTS

  	
   

  	
  96

  	
   

  
	
  10.11

  	
   

  	
  ACTION BY THE EMPLOYER

  	
   

  	
  96

  	
   

  
	
  10.12

  	
   

  	
  NAMED FIDUCIARIES AND
  ALLOCATION OF RESPONSIBILITY

  	
   

  	
  96

  	
   

  
	
  10.13

  	
   

  	
  HEADINGS

  	
   

  	
  97

  	
   

  
	
  10.14

  	
   

  	
  APPROVAL BY INTERNAL
  REVENUE SERVICE

  	
   

  	
  97

  	
   

  
	
  10.15

  	
   

  	
  UNIFORMITY

  	
   

  	
  97

  	
   

  
	
  10.16

  	
   

  	
  PAYMENT OF BENEFITS

  	
   

  	
  97

  	
   

  

 

iii

 

ARTICLE XI

PARTICIPATING EMPLOYERS

 

	
  11.1

  	
   

  	
  ELECTION TO BECOME A
  PARTICIPATING EMPLOYER

  	
   

  	
  98

  	
   

  
	
  11.2

  	
   

  	
  REQUIREMENTS OF
  PARTICIPATING EMPLOYERS

  	
   

  	
  98

  	
   

  
	
  11.3

  	
   

  	
  DESIGNATION OF AGENT

  	
   

  	
  98

  	
   

  
	
  11.4

  	
   

  	
  EMPLOYEE TRANSFERS

  	
   

  	
  98

  	
   

  
	
  11.5

  	
   

  	
  PARTICIPATING
  EMPLOYER’S CONTRIBUTION AND FORFEITURES

  	
   

  	
  99

  	
   

  
	
  11.6

  	
   

  	
  AMENDMENT

  	
   

  	
  99

  	
   

  
	
  11.7

  	
   

  	
  DISCONTINUANCE OF
  PARTICIPATION

  	
   

  	
  99

  	
   

  
	
  11.8

  	
   

  	
  ADMINISTRATOR’S
  AUTHORITY

  	
   

  	
  100

  	
   

  
	
  11.9

  	
   

  	
  PARTICIPATING EMPLOYER CONTRIBUTION FOR AFFILIATE

  	
   

  	
  100

  	
   

  

 

ARTICLE XII

CASH OR DEFERRED PROVISIONS

 

	
  12.1

  	
   

  	
  FORMULA FOR DETERMINING
  EMPLOYER’S CONTRIBUTION

  	
   

  	
  100

  	
   

  
	
  12.2

  	
   

  	
  PARTICIPANT’S  SALARY REDUCTION ELECTION

  	
   

  	
  101

  	
   

  
	
  12.3

  	
   

  	
  ALLOCATION OF
  CONTRIBUTION, FORFEITURES AND EARNINGS

  	
   

  	
  105

  	
   

  
	
  12.4

  	
   

  	
  ACTUAL DEFERRAL
  PERCENTAGE TESTS

  	
   

  	
  107

  	
   

  
	
  12.5

  	
   

  	
  ADJUSTMENT TO ACTUAL
  DEFERRAL PERCENTAGE TESTS

  	
   

  	
  110

  	
   

  
	
  12.6

  	
   

  	
  ACTUAL CONTRIBUTION
  PERCENTAGE TESTS

  	
   

  	
  115

  	
   

  
	
  12.7

  	
   

  	
  ADJUSTMENT TO ACTUAL
  CONTRIBUTION PERCENTAGE TESTS

  	
   

  	
  118

  	
   

  
	
  12.8

  	
   

  	
  SAFE HARBOR PROVISIONS

  	
   

  	
  123

  	
   

  
	
  12.9

  	
   

  	
  ADVANCE DISTRIBUTION FOR HARDSHIP

  	
   

  	
  125

  	
   

  

 

ARTICLE XIII

SIMPLE 40l(K) PROVISIONS

 

	
  13.1

  	
   

  	
  SIMPLE 401(K)
  PROVISIONS

  	
   

  	
  127

  	
   

  
	
  13.2

  	
   

  	
  DEFINITIONS

  	
   

  	
  127

  	
   

  
	
  13.3

  	
   

  	
  CONTRIBUTIONS

  	
   

  	
  128

  	
   

  
	
  13.4

  	
   

  	
  ELECTION AND NOTICE
  REQUIREMENTS

  	
   

  	
  129

  	
   

  
	
  13.5

  	
   

  	
  VESTING REQUIREMENTS

  	
   

  	
  129

  	
   

  
	
  13.6

  	
   

  	
  TOP-HEAVY RULES

  	
   

  	
  129

  	
   

  
	
  13.7

  	
   

  	
  NONDISCRIMINATION TESTS

  	
   

  	
  129

  	
   

  

 

iv

 

Defined Contribution Prototype Plan

 

ARTICLE 1

DEFINITIONS

 

As used in this Plan, the following words and phrases shall have the
meanings set forth herein unless a different meaning is clearly
required by the context:

 

1.1          “ACP”
means the “Actual Contribution Percentage” determined pursuant to Section
12.6(e).

 

1.2          “Act”
means the Employee Retirement Income Security Act of 1974, as it may be amended from time to time.

 

1.3          “ADP”
means the “Actual Deferral Percentage” determined pursuant to Section 12.4(e).

 

1.4          “Administrator”  means the Employer unless another person or
entity has been designated by the Employer pursuant to Section 2.2 to
administer the Plan on behalf of the Employer.

 

1.5          “Adoption
Agreement” means the separate agreement which is executed by the
Employer and sets forth the elective provisions of this Plan and Trust as
specified by the Employer.

 

1.6          “Affiliated
Employee” means any corporation which is a member of a controlled
group of corporations (as defined in Code
Section 414(b)) which includes the Employer; any trade or business (whether or not incorporated) which is under
common control (as defined in Code Section 414(c)) which includes the Employer;
any organization (whether or not incorporated) which is a member of an affiliated service group (as defined in Code Section
414(m)) which includes the Employer; and any other entity required to be
aggregated with the Employer pursuant to Regulations under Code Section 414(o).

 

1.7          “Anniversary
Date”  means the last day of the Plan Year.

 

1.8          “Annuity
Starting Date” means, with respect to any Participant, the first day
of the first period for which an amount is paid as an annuity, or, in the ease of a benefit not payable in the form of an
annuity, the first day on which all events have occurred which entitles the
Participant to such benefit.

 

1.9       “Beneficiary” means
the person (or entity) to whom all or a portion of a deceased
Participant’s interest in the Plan is payable, subject to the restrictions of
Sections 6.2 and 6.6.

 

1.10        “Code”
means the Internal Revenue Code of 1986, as amended.

 

1.11        “Compensation”
with respect to any Participant means
one of the following as elected in the Adoption Agreement:

 

1

 

(a)           Information required
to be reported under Code Sections 6041, 6051 and 6052 (Wages, tips and other
compensation as reported on Form W-2).  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 must 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)).

 

(b)           Code
Section 3401(a) Wages.  Compensation
means an Employee’s wages within the meaning of Code Section 3401(a) for the
purposes of income tax withholding at the source but determined without regard
to any rules 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)).

 

(c)           415 Safe-Harbor
Compensation. Compensation means wages, salaries, and fees for professional
services and other amounts received (without regard to whether or not an amount
is paid in cash) for personal services actually rendered in the course of
employment with the Employer maintaining the Plan to the extent that the
amounts are includible in gross income (including, but not limited to,
commissions paid salespersons, compensation for services on the basis of a
percentage of profits, commissions on insurance premiums, tips, bonuses, fringe
benefits, and reimbursements, or other expense allowances under a
nonaccountable plan (as described in Regulation l.62-2(c))), and excluding the
following:

 

(1)           Employer contributions to a plan of
deferred compensation which are not includible in the Employee’s gross income
for the taxable year in which contributed, or Employer contributions under a simplified employee pension plan to the extent
such contributions are excludable from the Employee’s gross income, or
any distributions from a plan of deferred compensation;

 

(2)           Amounts realized from the exercise of
a nonqualified stock option, or when restricted stock (or property) held by the Employee either becomes
freely transferable or is no longer subject to a substantial risk of
forfeiture;

 

(3)           Amounts realized
from the sale, exchange or other disposition of stock acquired under a
qualified stock option; and

 

(4)           Other amounts which
receive special tax benefits, or contributions made by the
Employer (whether  or not under a salary reduction agreement)
towards the purchase of an annuity contract described in Code Section 403(b)
(whether or not the contributions are actually excludable from the gross income
of the Employee).

 

2

 

However,
Compensation for any Self-Employed
Individual shall be equal to Earned Income. Compensation shall include only
that Compensation which is actually paid to the Participant during the
determination period.  Except as
otherwise provided in this Plan, the determination period shall be the period  elected by the Employer in the Adoption
Agreement.  If the Employer makes no
election, the determination period shall be the Plan Year.

 

Notwithstanding the above, if elected in the Adoption Agreement,
Compensation shall include all of the following types of elective contributions
and all of the following types of deferred compensation:

 

(a)              Elective
contributions that are made by the Employer on behalf of a Participant that are
not includible in gross income under Code Sections
125, 402(e)(3), 402(h)(1)(B), 403(b), and for Plan Years beginning on or after
January 1, 2001 (or as of a date, no earlier than January 1, 1998, as specified
in an addendum to the Adoption Agreement), 132(f)(4);

 

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

 

(c)               Employee
contributions (under governmental plans) described in Code Section 414(h)(2)
that are picked up by the employing unit and thus are treated as Employer
contributions.

 

For Plan Years
beginning on or after January, 1989, and before January 1, 1994, the annual
Compensation of each Participant taken into account for determining all
benefits provided under the Plan for any Plan Year shall not exceed
$200,000.  This limitation shall be
adjusted by the Secretary at the same time and in the same manner as under Code
Section 415(d), except that the dollar increase in effect on January 1 of any
calendar year is effective for Plan Years beginning in such calendar year and
the first adjustment to the $200,000 limitation is effective on January 1,
1990.

 

For Plan Years beginning on or after January 1, 1994, Compensation in
excess of $150,000 (or such other amount provided in the Code) shall be
disregarded for all purposes other than for purposes of salary deferral
elections. Such amount shall be adjusted by
the Commissioner for increases in the cost-of-living 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 in such calendar
year.  If a determination period consists of fewer than twelve (12) months, the
$150,000 annual Compensation limit will be multiplied by a fraction, the
numerator of which is the number of months in the determination period, and the
denominator of which is twelve (12).

 

If Compensation for any prior determination period is taken into
account in determining a Participant’s 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 prior period.  For this
purpose, in determining allocations in Plan Years beginning on or after
January 1, 1989, the annual compensation limit in effect for determination
periods beginning

 

3

 

before that
date is $200,000. In addition, in
determining allocations in Plan Years beginning on or after January 1, 1994,
the annual Compensation limit in effect for determination periods
beginning before that date is $150,000.

 

Notwithstanding the foregoing, except as otherwise
elected in a non-standardized Adoption Agreement, the family member
aggregation rules of Code Sections 401(a)(17) and 414(q)(6) as in effect prior
to the enactment of the Small Business Job Protection Act of 1996 shall not
apply to this Plan effective with respect to Plan Years beginning after
December 31, 1996.

 

If, in the Adoption Agreement, the Employer elects to exclude a class
of Employees from the Plan, then Compensation
for any Employee who becomes eligible or ceases to be eligible to participate
during a determination period shall only include Compensation while the
Employee is an Eligible Employee.

 

If, in connection with the adoption of any
amendment, the definition of Compensation has been modified, then,
except as otherwise provided herein, for Plan Years prior to the Plan Year
which includes the adoption date of such amendment, Compensation means
compensation determined pursuant to the terms of the Plan then in effect.

 

1.12        “Contract”
or “Policy” means any life
insurance policy, retirement income policy, or annuity contract (group or
individual) issued by the Insurer. In the event of any conflict between the
terms of this Plan and the terms of any contract purchased hereunder, the Plan
provisions shall control.

 

1.13      “Designated
Investment Alternative” means a specific investment identified by
name by the Employer (or such other Fiduciary who has been given the authority
to select investment options) as an available investment under the Plan to
which Plan assets may be invested by the Trustee pursuant to the investment
direction of a Participant.

 

1.14        “Directed
Investment Option”  means a Designated Investment Alternative and any other investment permitted by the Plan and the Participant Direction Procedures to which Plan assets
may be invested pursuant to the investment direction of a Participant.

 

1.15        “Early
Retirement Date” means the date specified in the Adoption Agreement
on which a Participant or Former Participant
has satisfied the requirements specified in the Adoption Agreement (Early
Retirement Age).  If elected in the
Adoption Agreement, a Participant shall become fully Vested upon satisfying
such requirements if the Participant is still employed at the Early Retirement
Age.

 

A Former
Participant who separates from service after satisfying any service requirement
but before satisfying the age requirement
for Early Retirement Age and who thereafter reaches the age requirement contained
herein shall he entitled to receive benefits under this Plan (other than
any accelerated vesting and
allocations of Employee Contributions) as though the requirements for Early Retirement Age had been satisfied.

 

4

 

1.16        “Earned
Income” means the net earnings from self-employment in the trade or
business with respect to which the Plan is established, for which the personal
services of the individual are a material income-producing factor. Net earnings
will be determined without regard to items not included in gross income and the
deductions allocable to such items. Net earnings
are reduced by contributions made by the Employer to a qualified plan to the
extent deductible under Code Section 404. In addition, net earnings
shall be determined with  regard to the deduction allowed to
the taxpayer by Code Section 164(f), for taxable years beginning after December
31, 1989.

 

1.17        “Elective
Deferrals” means the Employer’s contributions to the Plan
that are made pursuant to a Participant’s deferral election pursuant to Section
12.2, excluding any such amounts distributed as “excess annual additions”
pursuant to Section 4.5.  Elective
Deferrals shall be subject to the requirements of Sections 12.2(b) and 12.2(c)
and shall, except as otherwise provided herein, be required to satisfy the
nondiscrimination requirements of Regulation 1.401(k)-1(b)(2), the provisions
of which are specifically incorporated herein by reference.

 

1.18        “Eligible
Employee” means any Eligible Employee as elected in the Adoption
Agreement and as provided herein. With
respect to a non-standardized Adoption Agreement, an individual shall not be an
“Eligible Employee” if such individual is not reported on the
payroll records of the Employer as a common law employee.  In particular, it is expressly intended that
individuals not treated as common law employees by the Employer on its payroll
records are not “Eligible Employees” and are excluded from Plan participation
even if a court or administrative agency determines that such individuals are
common law employees and not independent contractors.  Furthermore, with respect to a
non-standardized Adoption Agreement, Employees of an Affiliated Employer will
not be treated as “Eligible Employees” prior to the date the Affiliated
Employer adopts the Plan as a Participating Employer.

 

Except as
otherwise provided in this paragraph, if the Employer does not elect in the
Adoption Agreement to include Employees who
became Employees as the result of a “Code Section 410(b)(6)(C) transaction,”
then such Employees will  only be
“Eligible Employees” after the expiration of the transition 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. 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 that
is subject to the special rules set forth in Code Section 410(b)(6)(C ).
However, regardless of any election made in the Adoption Agreement, if a
separate entity becomes an Affiliate Employer as the result of a “Code Section
410(b)(6)(C) transaction,” then Employees of such separate entity will not be
treated as “Eligible Employees” prior to the date the entity adopts the Plan as
a Participating Employer or, with respect to a standardized Adoption Agreement,
if earlier, the expiration of the transition period set forth above.

 

If, in the
Adoption Agreement, the Employer elects to exclude union employees, then
Employees whose employment is governed by a collective bargaining agreement
between the Employer and “employee representatives” under which retirement
benefits were the subject of good faith bargaining and if two percent (2%) or
less of the Employees covered pursuant to

 

5

 

that agreement are
professionals as defined in Regulation 1.410(b)-9, shall not be eligible to
participate in this Plan.  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.

 

If, in the
Adoption Agreement, the Employer elects to exclude non-resident aliens, then
Employees who are non-resident aliens (within the meaning of Code Section
7701(b)(1)(B)) who received no earned income (within the meaning of Code
Section 911(d)(2)) from the Employer which constitutes income from sources
within the United States (within the meaning of Code Section 861(a)(3)) shall
not be eligible to participate in this Plan.

 

1.19        “Employee”
means any person who is employed by the Employer. The
term “Employee” shall also include any
person who is an employee of an Affiliated Employer and any Leased Employee
deemed to be an Employee as provided in Code Section 414(n) or (o).

 

1.20     “Employer” means the entity
specified in the Adoption Agreement, any successor which shall maintain this
Plan and any predecessor which has maintained this Plan.  In addition, unless the context means
otherwise, the term “Employer” shall include any Participating Employer (as
defined in Section 11.1) which shall adopt this Plan.

 

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

 

(a)             The aggregate “Contribution Percentage Amounts”
(as defined in Section 12.6) actually made on behalf of Highly
Compensated Participants for such Plan Year and taken into account in computing
the numerator of the ACP, over

 

(b)             The
maximum “Contribution Percentage Amounts” permitted by the ACP test in Section
12.6 (determined by reducing contributions made on behalf of Highly Compensated
Participants in order of their “Contribution Percentages” beginning with the
highest of such percentages).

 

Such
determination shall be made after first taking into account corrections of any
Excess Deferrals pursuant to Section 12.2 and then taking into account
adjustments of any Excess Contributions pursuant to Section 12.5.

 

1.22        “Excess
Compensation”  means, with respect to a Plan
that is integrated with Social Security (permitted disparity), a Participant’s
Compensation which is in excess of the integration level elected in the
Adoption Agreement.

 

However, if
Compensation is based on less than a twelve (12) month determination period,
Excess Compensation shall be determined by reducing the integration level by a
fraction, the numerator of which is the number of full months in the short
period and the denominator of which is twelve (12).

 

6

 

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

 

(a)           The
aggregate amount of Employer contributions actually  made on
behalf of Highly Compensated Participants for such Plan Year and taken into account in computing the
numerator of the ADP, over

 

(b)           The
maximum amount of such contributions permitted by the ADP test in Section 12.4
(determined by hypothetically reducing contributions made on
behalf of Highly Compensated Participants in order of the actual deferral
ratios, beginning with the highest of such ratios).

 

In determining
the amount of Excess Contributions to be distributed and/or recharacterized
with respect to an affected Highly Compensated Participant as determined
herein, such amount shall be reduced by any Excess Deferrals previously  distributed to such affected Highly
Compensated Participant for the Participant’s taxable year ending with or
within such Plan Year.

 

1.24        “Excess
Deferrals” means, with respect to any taxable year of a Participant,
those elective deferrals (within the meaning of Code Section 402(g)) that are
includible in the Participant’s gross income under Code Section 402(g) to the
extent such Participant’s elective deferrals for the taxable year exceed the
dollar limitation under such Code Section. 
Excess Deferrals shall be treated as an “Annual Addition” pursuant to
Section 4.4 when contributed to the Plan unless distributed to the affected Participant not later than the first April 15th
following the close of the Participant’s taxable year in which the Excess
Deferral was made. Additionally, for purposes of Sections 4.3(f) and
9.2, Excess Deferrals shall continue to be treated as Employer contributions
even if distributed pursuant to Section 12.2(e).  However, Excess Deferrals of Non-Highly
Compensated Participants are not taken into account for purposes of Section
12.4.

 

1.25        “Fiduciary”
means any person who (a) exercises any discretionary authority or discretionary
control respecting management of the Plan or exercises any authority or control
respecting management or disposition of its assets, (b) renders investment
advice for a fee or other compensation, direct or indirect, with respect to any
monies or other property of the Plan or has any authority or responsibility to
do so, or (c) has any discretionary authority or discretionary responsibility
in the administration of the Plan.

 

1.26          “Fiscal
Year” means the Employer’s accounting year.

 

1.27           “Forfeiture”
means, with respect to a Former Participant who has severed employment, that
portion of the Participant’s Account that is not Vested. Unless otherwise
elected in the Adoption Agreement, Forfeitures occur pursuant to (a) below.

 

(a)           A Forfeiture will
occur on the earlier of:

 

(1)           The last day of the Plan Year in
which a Former Participant  who has
severed employment with the Employer incurs five (5) consecutive 1-Year
Breaks in Service, or

 

7

 

(2)           The distribution of the entire Vested
portion of the Participant’s Account of a Former Participant who has severed employment with the Employer.  For purposes of this provision, if the Former
Participant has a Vested benefit of zero, then such Former Participant
shall be deemed to have received a distribution of such Vested benefit as of
the year in which the severance of employment occurs.

 

(b)              If elected in the Adoption
Agreement, a Forfeiture will occur as of the last day of the Plan Year in which
the Former Participant incurs five (5) 1-Year Breaks in Service.

 

Regardless of the preceding provisions, if a Former Participant is
eligible to share in the allocation of Employer contributions or Forfeitures in
the year in which the Forfeiture would otherwise occur, then the Forfeiture will not occur until the end of the first
Plan Year for which the Former Participant is not eligible to share in the
allocation of Employer contributions or
Forfeitures.  Furthermore, the term
“Forfeiture” shall also include amounts
deemed to be Forfeitures pursuant to any other provision of this Plan.

 

1.28        “Former
Participant” means a person who has been a Participant, but who has ceased to be a Participant
for any reason.

 

1.29        “414(s)
Compensation” means any definition of compensation that satisfies
the nondiscrimination requirements of Code Section 414(s) and the Regulations
thereunder.  The period for determining
414(s) Compensation must be either the Plan Year or the calendar  year
ending with or within the Plan Year. An Employer may further limit the period
taken into account to that part of the Plan Year or calendar year in which an
Employee was a Participant in the component of the Plan being tested. The period used to determine 414(s) Compensation must be
applied uniformly to all Participants for the Plan Year.

 

1.30        “415
Compensation” means, with respect to any Participant,
such Participant’s (a) Wages, tips and other compensation on Form W-2, (b)
Section 3401(a) wages or (c) 415 safe-harbor compensation as elected in the
Adoption Agreement for purposes of Compensation.  415 Compensation shall be based on the full
Limitation Year regardless of when participation in the Plan commences.  Furthermore, regardless of any election made
in the Adoption Agreement, with respect to Limitation Years beginning after
December 31, 1997, 415 Compensation shall include any elective deferral (as
defined in Code Section 402(g)(3)) and any
amount which  is contributed or deferred by the Employer at the
election of the Participant and which is not includible in the gross
income of the Participant by reason of Code Section 125, 457, and, for
Limitation Years beginning on or after January 1, 2001 (or as of a date, no
earlier than January 1, 1998, as specified in an addendum to the Adoption
Agreement), 132(f)(4).  For Limitation
Years beginning prior to January 1, 1998, 415 Compensation shall exclude such
amounts.

 

Except as
otherwise provided herein, if, in connection with the adoption of any
amendment, the definition of 415 Compensation has been modified, then for Plan
Years prior to the Plan Year which includes the adoption date of such
amendment, 415 Compensation means compensation determined pursuant to the terms
of the Plan then in effect.

 

8

 

1.31        “Highly Compensated
Employee”  means,
effective for Plan Years beginning after December 31, 1996, an Employee
described in Code Section 414(q)  and
the Regulations thereunder, and generally means an Employee who:

 

(a)           was
a “five percent (5%) owner” as defined in Section 1.37(c) at any time during
the “determination year” or the “look-back year”; or

 

(b)           for
the “look-back year” had 415 Compensation from the Employer in excess of
$80,000 and, if elected in the Adoption Agreement, was in the Top-Paid Group
for the “look-back 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.

 

The
“determination year” means the Plan Year for which testing is being performed
and the “look-back year” means the immediately preceding twelve (12) month
period.  However, if the calendar year
data election is made in the Adoption Agreement, for purposes of (b) above, the
“look-back year” shall be the calendar year beginning within the twelve (12)
month period immediately preceding the “determination year.”  Notwithstanding the preceding sentence, if
the calendar year data election is effective with respect to a Plan Year
beginning in 1997, then for such Plan Year the “look-back year” shall be the calendar year ending with or within the Plan Year
for which testing is being performed, and the “determination year” shall be the
period of time, if any, which extends beyond the “look-back year” and ends on
the last day of the Plan Year for which testing is being performed.

 

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 Regulation 1.414(q)-IT, A-4 and IRS Notice 97-45 (or any
superseding guidance).

 

In determining
whether an employee is a Highly Compensated Employee for a Plan Year beginning
in 1997, the amendments to Code Section 414(q) stated above are treated as having
been in effect for years beginning in 1996.

 

For purposes
of this Section, for Plan Years beginning prior to January 1, 1998, the
determination of 415 Compensation shall be made by including amounts that would
otherwise be excluded from a Participant’s gross income by reason of the application of Code Sections 125,
402(e)(3), 402(e)(3), 402(h)(1)(B) and, for Plan Years beginning on or after
January 1, 2001 (or as of a date, no earlier than January 1, 1998, as
specified in an addendum to the Adoption Agreement), 132(f)(4), and, in the
case of Employer contributions made pursuant to a salary reduction agreement,
Code Section 403(b).

 

In determining
who is a Highly Compensated Employee, Employees
who are non-resident aliens and who received no earned income (within
the meaning of Code Section. 911(d)) from the Employer constituting United
States source income within the meaning of Code Section 861(a)(3)  shall not be treated as Employees.  Additionally, all Affiliated Employers shall
be taken

 

9

 

into account as a single
employer and Leased Employees within the meaning of Code Sections 414(n)(2) and
414(o)(2) shall be considered Employees unless such Leased Employees are
covered by a plan described in Code Section 414(n)(5) and are not in any
qualified plan maintained by the Employer. 
The exclusion of Leased Employees for this purpose shall be applied on a
uniform and consistent basis for all
of the Employer’s retirement plans.

 

1.32        “Highly
Compensated Participant” means any Highly Compensated Employee who
is eligible to participate in the component of the Plan being tested.

 

1.33        “Hour of Service” means (1) each hour for
which an Employee is directly or indirectly compensated or entitled to compensation by the Employer for the
performance of duties during the applicable computation period (these hours will be credited to the
Employee for the computation period in which the duties are performed;  (2) each hour for which an Employee is
directly or indirectly compensated or entitled to compensation by the Employer (irrespective of whether the
employment relationship has terminated) for reasons other than performance of
duties (such as vacation, holidays, sickness, incapacity (including
disability), jury duty, lay-off, military duty or leave of absence) during the
applicable computation period (these hours will be calculated and credited
pursuant to Department of Labor regulation 2530.200b-2 which is incorporated
herein by reference);  (3) each hour for
which back pay is awarded or agreed to by the Employer without regard to
mitigation of damages (these hours will be credited to the Employee far the
computation period or periods to which the award or agreement pertains rather than the computation period in
which the award, agreement or payment
is made).  The same Hours of Service
shall not be credited both under (1) or (2), as the case may be, and
under (3).

 

Notwithstanding
(2) above, (i) no more than 501 Hours of Service are required to be credited to
an Employee on account of any single continuous period during which the
Employee performs no duties (whether or not such period occurs a single
computation period); (ii) an hour for which an Employee is directly or
indirectly paid, or entitled to payment, on account of a period during which no duties are performed
is not required to be credited
to the Employee if such payment is made or due under a plan
maintained solely for the purpose of complying with applicable workers’
compensation, or unemployment compensation or disability insurance laws;  and (iii) Hours of Service are not required
to be credited for a payment which solely reimburses an Employee for medical or
medically related expenses incurred by the Employee.  Furthermore, for purposes of (2) above, 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
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.

 

Hours of
Service will be credited for employment with all Affiliated Employers and for
any individual considered to be a Leased Employee pursuant to Code Section
4l4(n) or 414(o) and the Regulations thereunder.  Furthermore, the provisions of Department of
Labor regulations 2530.200b-2(b) and (c) are incorporated herein by reference.

 

10

 

Hours of
Service will be determined on the basis of the method elected in the Adoption
Agreement.

 

1.34.       “Insurer”
means any legal reserve insurance company which has issued or shall issue one
or more Contracts or Policies under the Plan.

 

1.35                        “Investment
Manager” means a Fiduciary as described in Act Section 3(38).

 

1.36        “Joint
and Survivor Annuity” means an annuity for the life of
a Participant with a survivor annuity for the life of the Participant’s spouse
which is not less than fifty percent (50%), nor more than one-hundred percent
(100%) of the amount of the annuity payable during the joint lives of the
Participant and the Participant’s spouse which can be purchased with the Participant’s
Vested interest in the Plan reduced by any outstanding loan balances pursuant
to Section 7.6.

 

1.37        “Key
Employee” means an Employee as defined in Code Section
416(i) and the Regulations thereunder. 
Generally, any Employee or former Employee (as well as each of such
Employee’s or former Employee’s Beneficiaries) is considered a Key Employee if,
the individual at any time during the Plan Year that contains the
“Determination Date” (as defined in Section 9.2(c)) or any of the preceding
four (4) Plan Years, has been included in one of the following categories:

 

(a)           an officer of the
Employer (as that term is defined within the meaning of the Regulations under
Code Section 416) having annual 415 Compensation greater than fifty percent
(50%) of the amount in effect under Code Section 415(b)(1)(A) for any such Plan
Year;

 

(b)           one of the ten
Employees having annual 415 Compensation from the Employer for a Plan Year
greater than the dollar limitation in effect under Code Section 415(c)(1)(A)
for the calendar year in which such Plan Year ends and owning (or considered as
owning within the meaning of Code Section 318) both more than one-half percent
(1/2%) interest and the largest interests in the Employer;

 

(c)           a
“five percent (5%) owner” of the Employer. 
“Five percent (5%) owner” means any person who owns (or is considered as
owning within the meaning of Code Section 318) more than five percent (5%) of
the value of the outstanding stock of the Employer or stock possessing more
than five percent (5%) of the total combined voting power of all stock of the
Employer or, in the case of an unincorporated business, any person who owns
more than five percent (5%) of the capital or profits interest in the Employer;
and

 

(d)           a
“one percent (1%) owner” of the Employer having annual 415 Compensation from
the Employer of more than $150,000.  “One
percent (1%) owner” means any person who owns (or is considered as owning
within the meaning of Code Section 318) more than one percent (1%) of the value
of the outstanding stock of the Employer or stock possessing more than one
percent (1%) of the total combined voting

 

11

 

power of all stock of the Employer or, in the
case of an unincorporated business, any person who owns more than one percent
(1%) of the capital or profits interest in the Employer.

 

In determining percentage ownership hereunder, employers that would
otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be
treated as separate employers.  In determining
whether an individual has 415 Compensation of more than $150,000, 415
Compensation from each employer required to be aggregated under Code Sections
414(b), (c), (m) and (o) shall be taken into account.  Furthermore, for purposes of this Section,
for Plan Years beginning prior to January 1, 1998, the determination of 415
Compensation shall be made by including amounts that would otherwise be
excluded from a Participant’s gross income by reason of the application of Code
Sections 125, 402(e)(3), 402(h)(1)(B) and, for Plan Years beginning on or after
January 1, 2001 (or as of a date, no earlier than January 1, 1998, as
specified in an addendum to the Adoption Agreement), 132(f)(4), and, in the
case of Employer contributions made pursuant to a salary reduction agreement,
Code Section 403(b).

 

1.38        “Late
Retirement Date” means the date of, or the firstt day
of the month or the Anniversary Date coinciding with or next following,
whichever corresponds to the election in the Adoption Agreement for the Normal
Retirement Date, a Participant’s actual retirement after having reached the
Normal Retirement Date.

 

1.39        “Leased
Employee” means, effective with respect to Plan Years
beginning on or after January 1, 1997, any person (other than an Employee of
the recipient Employer) who, pursuant to an agreement between the recipient
Employer and any other person or entity (“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 Employer.  Contributions or benefits provided a Leased
Employee by the leasing organization, which are attributable to services
performed for the recipient Employer shall be treated as provided by the
recipient Employer.  Furthermore,
Compensation for a Leased Employee shall only include Compensation from the
leasing organization that is attributable to services performed for the
recipient Employer.

 

A Leased
Employee shall not be considered an employee of the recipient Employer if:  (a) such employee is covered by a money
purchase pension plan providing:  (1) a
nonintegrated employer contribution rate of at least ten percent (10%) of
compensation, as defined in Code Section 415(c)(3), but for Plan Years
beginning prior to January 1, 1998, including amounts contributed pursuant to a
salary reduction agreement which are excludable from the employee’s gross
income under Code Sections 125, 402(e)(3), 402(h)(1)(B), 403(b), or for Plan
Years beginning on or after January 1, 2001 (or as of a date, no earlier than
January 1, 1998, as specified in an addendum to the Adoption Agreement),
132(f)(4), (2) immediate participation, and (3) full and immediate vesting; and
(b) leased employees do not constitute more than twenty percent (20%) of the
recipient Employer’s nonhighly compensated workforce.

 

1.40        “Limitation
Year” means the determination period used to determine
Compensation.  However, the Employer may
elect a different Limitation Year in the Adoption

 

12

 

Agreement or by adopting a
written resolution to such effect.  All
qualified plans maintained by the Employer must use the same Limitation
Year.  Furthermore, unless there is a
change to a new Limitation Year, the Limitation Year will be a twelve (12)
consecutive month period.  In the case of
an initial Limitation Year, the Limitation Year will be the twelve (12)
consecutive month period ending on the last day of the period specified in the
Adoption Agreement (or written resolution). 
If the Limitation Year is amended to a different twelve (12) consecutive
month period, the new “Limitation Year” must begin on a date within the
“Limitation Year” in which the amendment is made.

 

1.41        “Net
Profit” means, with respect to any Fiscal Year, the
Employer’s net income or profit for such Fiscal Year determined upon the basis
of the Employer’s books of account in accordance with generally accepted
accounting principles, without any reduction for taxes based upon income, or
for contributions made by the Employer to this Plan and any other qualified
plan.

 

1.42        “Non-Elective
Contribution” means the Employer’s contributions to
the Plan other than Elective Deferrals, any Qualified Non-Elective
Contributions and any Qualified Matching Contributions.  Employer matching contributions which are not
Qualified Matching Contributions shall be considered a Non-Elective
Contribution for purposes of the Plan.

 

1.43        “Non-Highly
Compensated Participant” means any Participant who is
not a Highly Compensated Employee. 
However, if pursuant to Sections 12.4 or 12.6 the prior year testing
method is used to calculate the ADP or the ACP, a Non-Highly Compensated
Participant shall be determined using the definition of Highly Compensated
Employee in effect for the preceding Plan Year.

 

1.44        “Non-Key
Employee” means any Employee or former Employee (and
such Employee’s or former Employee’s Beneficiaries) who is not, and has never
been, a Key Employee.

 

1.45        “Normal
Retirement Age” means the age elected in the Adoption
Agreement at which time a Participant’s Account shall be nonforfeitable (if a
Participant is employed by the Employer on or after that date).

 

1.46        “Normal
Retirement Date” means the date elected in the
Adoption Agreement.

 

1.47        “1-Year
Break in Service” means, if the Hour of Service Method
is elected in the Adoption Agreement, the applicable computation period during
which an Employee or former Employee has not completed more than 500 Hours of
Service.  Further, solely for the purpose
of determining whether an Employee has incurred a 1-Year Break in Service,
Hours of Service shall be recognized for “authorized leaves of absence” and
“maternity and paternity leaves of absence.” 
For this purpose, Hours of Service shall be credited for the computation
period in which the absence from work begins, only if credit therefore is
necessary to prevent the Employee from incurring a 1-Year Break in Service, or,
in any other case, in the immediately following computation period.  The Hours of Service credited for a
“maternity or paternity leave of absence” shall be those which would normally
have been credited but for such absence, or, in

 

13

 

any case in which the
Administrator is unable to determine such hours normally credited, eight (8)
Hours of Service per day.  The total
Hours of Service required to be credited for a “maternity or paternity leave of
absence” shall not exceed the number of Hours of Service needed to prevent the
Employee from incurring a 1-Year Break in Service.

 

“Authorized
leave of absence” means an unpaid, temporary cessation from active employment
with the Employer pursuant to an established nondiscriminatory policy, whether
occasioned by illness, military service, or any other reason.

 

A  “maternity  or  paternity  leave  of  absence”  means  an  absence  from  work  for  any  period  by  reason  of  the  Employee’s  pregnancy,  birth  of  the  Employee’s  child,  placement  of  a  child  with  the  Employee  in  connection  with  the  adoption  of  such  child,  or  any  absence  for  the  purpose  of  caring  for  such  child  for  a  period  immediately  following  such  birth  or  placement.

 

If the Elapsed
Time Method is elected in the Adoption Agreement, a “1-Year Break in Service”
means a twelve (12) consecutive month period beginning on the severance from
service date or any anniversary thereof and ending on the next succeeding
anniversary of such date; provided, however, that the Employee or former
Employee does not perform an Hour of Service for the Employer during such
twelve (12) consecutive month period.

 

1.48        “Owner-Employee”
means a sole proprietor who owns the entire interest in the Employer or a
partner (or member in the case of a limited liability company treated as a
partnership or sole proprietorship for federal income tax purposes) who owns
more than ten percent (10%) of either the capital interest or the profits
interest in the Employer and who receives income for personal services from the
Employer.

 

1.49        “Participant”
means any Eligible Employee who has satisfied the requirements of Section 3.2
and has not for any reason become ineligible to participate further in the
Plan.

 

1.50        “Participant
Directed Account” means that portion of a
Participant’s interest in the Plan with respect to which the Participant has
directed the investment in accordance with the Participant Direction
Procedures.

 

1.51        “Participant
Direction Procedures” means such instructions,
guidelines or policies, the terms of which are incorporated herein, as shall be
established pursuant to Section 4.10 and observed by the Administrator and
applied and provided to Participants who have Participant Directed Accounts.

 

1.52        “Participant’s
Account” means the account established and maintained
by the Administrator for each Participant with respect to such Participant’s
total interest under the Plan resulting from (a) the Employer’s contributions
in the case of a Profit Sharing Plan or Money Purchase Plan, and (b) the
Employer’s Non-Elective Contributions in the case of a 401(k) Profit Sharing
Plan.  Separate accountings shall be
maintained with respect to that portion of a Participant’s Account attributable
to Employer matching contributions and to Employer discretionary contributions
made pursuant to Section 12.1(a)(3).

 

14

 

1.53        “Participant’s
Combined Account” means the total aggregate amount of
a Participant’s interest under the Plan resulting from Employer contributions
(including Elective Deferrals).

 

1.54        “Participant’s
Elective Deferral Account” means the account
established and maintained by the Administrator for each Participant with
respect to such Participant’s total interest in the Plan resulting from Elective
Deferrals.  Amounts in the Participant’s
Elective Deferral Account are nonforfeitable when made and are subject to the
distribution restrictions of Section 12.2(c).

 

1.55        “Participant’s
Rollover Account” means the account established and
maintained by the Administrator for each Participant with respect to such
Participant’s interest in the Plan resulting from amounts transferred from
another qualified plan or “conduit” Individual Retirement Account in accordance
with Section 4.6.

 

1.56        “Participant’s
Transfer Account” means the account established and
maintained by the Administrator for each Participant with respect to the total
interest in the Plan resulting from amounts transferred to this Plan from a
direct plan-to-plan transfer in accordance with Section 4.7.

 

1.57        “Period
of Service” means the aggregate of all periods
commencing with an Employee’s first day of employment or reemployment with the
Employer or an Affiliated Employer and ending on the first day of a Period of
Severance.  The first day of employment
or reemployment is the first day the Employee performs an Hour of Service.  An Employee will also receive partial credit
for any Period of Severance of less than twelve (12) consecutive months.  Fractional periods of a year will be
expressed in terms of days.

 

Periods of
Service with any Affiliated Employer shall be recognized.  Furthermore, Periods of Service with any
predecessor employer that maintained this Plan shall be recognized.  Periods of Service with any other predecessor
employer shall be recognized as elected in the Adoption Agreement.

 

In determining
Periods of Service for purposes of vesting under the Plan, Periods of Service
will be excluded as elected in the Adoption Agreement and as specified in
Section 3.5.

 

In the event
the method of crediting service is amended from the Hour of Service Method to
the Elapsed Time Method, an Employee will receive credit for a Period of
Service consisting of:

 

(a)           A number of years
equal to the number of Years of Service credited to the Employee before the
computation period during which the amendment occurs; and

 

(b)           The greater of (1)
the Periods of Service that would be credited to the Employee under the Elapsed
Time Method for service during the entire computation period in which the
transfer occurs or (2) the service taken into account under the Hour of Service
Method as of the date of the amendment.

 

15

 

In addition,
the Employee will receive credit for service subsequent to the amendment
commencing on the day after the last day of the computation period in which the
transfer occurs.

 

1.58        “Period
of Severance” means a continuous period of time during
which an Employee is not employed by the Employer.  Such period begins on the date the Employee
retires, quits or is discharged, or if earlier, the twelve (12) month
anniversary of the date on which the Employee was otherwise first absent from
service.

 

In the case of
an individual who is absent from work for “maternity or paternity” reasons, the
twelve (12) consecutive month period beginning on the first anniversary of the
first day of such absence shall not constitute a one year Period of
Severance.  For purposes of this
paragraph, an absence from work for “maternity or paternity” reasons means an
absence (a) by reason of the pregnancy of the individual, (b) by reason of the
birth of a child of the individual, (c) by reason of the placement of a child
with the individual in connection with the adoption of such child by such
individual, or (d) for purposes of caring for such child for a period beginning
immediately following such birth or placement.

 

1.59        “Plan”
means this instrument (hereinafter referred to as Morehead Plan Administrators,
Ltd. Defined Contribution Prototype Plan and Trust Basic Plan Document #01) and
the Adoption Agreement as adopted by the Employer, including all amendments
thereto and any addendum which is specifically permitted pursuant to the terms
of the Plan.

 

1.60        “Plan
Year” means the Plan’s accounting year as specified in
the Adoption Agreement.  Unless there is
a Short Plan Year, the Plan Year will be a twelve-consecutive month period.

 

1.61        “Pre-Retirement
Survivor Annuity” means an immediate annuity for the
life of a Participant’s spouse, the payments under which must be equal to the
benefit which can be provided with the percentage, as specified in the Adoption
Agreement, of the Participant’s Vested interest in the Plan as of the date of
death.  If no election is made in the
Adoption Agreement, the percentage shall be equal to fifty percent (50%).  Furthermore, if less than one hundred percent
(100%) of the Participant’s Vested interest in the Plan is used to provide the
Pre-Retirement Survivor Annuity, a proportionate share of each of the
Participant’s accounts shall be used to provide the Pre-Retirement Survivor
Annuity.

 

1.62        “Qualified
Matching Contribution” means any Employer matching
contributions that are made pursuant to Sections 12.1(a)(2) if elected in the
Adoption Agreement, 12.5 and 12.7.

 

1.63        “Qualified
Matching Contribution Account” means the account
established hereunder to which Qualified Matching Contributions are
allocated.  Amounts in the Qualified
Matching Contribution Account are nonforfeitable when made and are subject to
the distribution restrictions of Section 12.2(c).

 

16

 

1.64        “Qualified
Non-Elective Contribution” means the Employer’s
contributions to the Plan that are made pursuant to Sections 12.1(a)(4) if
elected in the Adoption Agreement, 12.5 and 12.7.

 

1.65        “Qualified
Non-Elective Contribution Account” means the account
established hereunder to which Qualified Non-Elective Contributions are
allocated.  Amounts in the Qualified
Non-Elective Contribution Account are nonforfeitable when made and are subject
to the distribution restrictions of Section 12.2(c).

 

1.66        “Qualified
Voluntary Employee Contribution Account” means the
account established hereunder to which a Participant’s tax deductible qualified
voluntary employee contributions made pursuant to Section 4.9 are allocated.

 

1.67        “Regulation”
means the Income Tax Regulations as promulgated by the Secretary of the
Treasury or a delegate of the Secretary of the Treasury, and as amended from
time to time.

 

1.68        “Retired
Participant” means a person who has been a
Participant, but who has become entitled to retirement benefits under the Plan.

 

1.69        “Retirement
Date” means the date as of which a Participant retires
for reasons other than Total and Permanent Disability, regardless of whether
such retirement occurs on a Participant’s Normal Retirement Date, Early
Retirement Date or Late Retirement Date (see Section 6.1).

 

1.70        “Self-Employed
Individual” means an individual who has Earned Income
for the taxable year from the trade or business for which the Plan is
established, and, also, an individual who would have had Earned Income but for
the fact that the trade or business had no net profits for the taxable
year.  A Self-Employed Individual shall
be treated as an Employee.

 

1.71        “Shareholder-Employee”
means a Participant who owns (or is deemed to own pursuant to Code Section
318(a)(1)) more than five percent (5%) of the Employer’s outstanding capital
stock during any year in which the Employer elected to be taxed as a Small
Business Corporation (S Corporation) under the applicable Code sections
relating to Small Business Corporations.

 

1.72        “Short
Plan Year” means, if specified in the Adoption
Agreement, a Plan Year of less than a twelve (12) month period.  If there is a Short Plan Year, the following
rules shall apply in the administration of this Plan.  In determining whether an Employee has
completed a Year of Service (or Period of Service if the Elapsed Time Method is
used) for benefit accrual purposes in the Short Plan Year, the number of the
Hours of Service (or months of service if the Elapsed Time Method is used)
required shall be proportionately reduced based on the number of days (or
months) in the Short Plan Year.  The
determination of whether an Employee has completed a Year of Service (or Period
of Service) for vesting and eligibility purposes shall be made in accordance
with Department of Labor regulation 2530.203-2(c).  In addition, if this Plan is integrated with
Social Security, then the integration level shall be proportionately reduced
based on the number of months in the Short Plan Year.

 

17

 

1.73        “Super
Top Heavy Plan” means a plan which would be a Top
Heavy Plan if sixty percent (60%) is replaced with ninety percent (90%) in
Section 9.2(a).  However, effective as of
the first Plan Year beginning after December 31, 1999, no Plan shall be
considered a Super Top Heavy Plan.

 

1.74        “Taxable
Wage Base” means, with respect to any Plan Year, the
contribution and benefit base under Section 230 of the Social Security Act at
the beginning of such Plan Year.

 

1.75        “Terminated
Participant” means a person who has been a
Participant, but whose employment has been terminated other than by death,
Total and Permanent Disability or retirement.

 

1.76        “Top
Heavy Plan” means a plan described in Section 9.2(a).

 

1.77        “Top
Heavy Plan Year” means a Plan Year commencing after
December 31, 1983, during which the Plan is a Top Heavy Plan.

 

1.78        “Top-Paid
Group” shall be determined pursuant to Code Section
414(q) and the Regulations thereunder and generally means the top twenty
percent (20%) of Employees who performed services for the Employer during the
applicable year, ranked according to the amount of 415 Compensation received
from the Employer during such year.  All
Affiliated Employers shall be taken into account as a single employer, and
Leased Employees shall be treated as Employees if required pursuant to Code
Section 414(n) or (o).  Employees who are
non-resident aliens who received no earned income (within the meaning of Code
Section 911(d)(2)) from the Employer constituting United States source income
within the meaning of Code Section 861(a)(3) shall not be treated as
Employees.  Furthermore, for the purpose
of determining the number of active Employees in any year, the following
additional Employees may also be excluded, however, such Employees shall still
be considered for the purpose of identifying the particular Employees in the
Top-Paid Group:

 

(a)                                  Employees with less
than six (6) months of service;

 

(b)                                 Employees who normally
work less than 17 1⁄2 hours per week;

 

(c)                                  Employees who
normally work less than six (6) months during a year; and

 

(d)                                 Employees who have not
yet attained age twenty-one (21).

 

In addition,
if ninety percent (90%) or more of the Employees of the Employer are covered
under agreements the Secretary of Labor finds to be collective bargaining
agreements between Employee representatives and the Employer, and the Plan
covers only Employees who are not covered under such agreements, then Employees
covered by such agreements shall be excluded from both the total number of
active Employees a well as from the identification of particular Employees in
the Top-Paid Group.

 

18

 

The foregoing
exclusions set forth in this Section shall be applied on a uniform and
consistent basis for all purposes for which the Code Section 414(q) definition
is applicable.  Furthermore, in applying
such exclusions, the Employer may substitute any lesser service, hours or age.

 

1.79        “Total
and Permanent Disability” means the inability to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result in
death or which has lasted or can be expected to last for a continuous period of
not less than twelve (12) months.  The
disability of a Participant shall be determined by a licensed physician chosen
by the Administrator.  However, if the
condition constitutes total disability under the federal Social Security Acts,
the Administrator may rely upon such determination that the Participant is
Totally and Permanently Disabled for the purposes of this Plan.  The determination shall be applied uniformly
to all Participants.

 

1.80        “Trustee”
means the person or entity named in the Adoption Agreement, or any successors
thereto.

 

If the sponsor
of this prototype is a bank, savings and loan, trust company, credit union or
similar institution, a person or entity other than the prototype sponsor (or
its affiliates or subsidiaries) may not serve as Trustee without the written
consent of the sponsor.

 

1.81        “Trust
Fund” means the assets of the Plan and Trust as the
same shall exist from time to time.

 

1.82        “Valuation
Date” means the date or dates specified in the
Adoption Agreement.  Regardless of any
election to the contrary, the Valuation Date shall include the Anniversary Date
and may include any other date or dates deemed necessary or appropriate by the
Administrator for the valuation of Participants’ Accounts during the Plan Year,
which may include any day that the Trustee, any transfer agent appointed by the
Trustee or the Employer, or any stock exchange used by such agent, are open for
business.

 

1.83        “Vested”
means the nonforfeitable portion of any account maintained on behalf of a
Participant.

 

1.84        “Voluntary
Contribution Account” means the account established
and maintained by the Administrator for each Participant with respect to such
Participant’s total interest in the Plan resulting from the Participant’s
after-tax voluntary Employee contributions made pursuant to Section 4.7.

 

Amounts
recharacterized as after-tax voluntary Employee contributions pursuant to
Section 12.5 shall remain subject to the limitations of Section 12.2.  Therefore, a separate accounting shall be
maintained with respect to that portion of the Voluntary Contribution Account
attributable to after-tax voluntary Employee contributions made pursuant to
Section 4.8.

 

19

 

1.85        “Year
of Service” means the computation period of twelve
(12) consecutive months, herein set forth, and during which an Employee has
completed at least 1,000 Hours of Service (unless a lower number of Hours of
Service is specified in the Adoption Agreement).

 

For purposes
of eligibility for participation, the initial computational period shall begin
with the date on which the Employee first performs an Hour of Service
(employment commencement date).  The
initial computation period beginning after a 1-Year Break in Service shall be
measured from the date on which an Employee again performs an Hour of
Service.  Unless otherwise elected in the
Adoption Agreement, the succeeding computation periods shall begin on the
anniversary of the Employee’s employment commencement date.  However, unless otherwise elected in the
Adoption Agreement, if one (1) Year of Service or less is required as a
condition of eligibility, then the computation period after the initial
computational period shall shift to the current Plan Year which includes the
anniversary of the date on which the Employee first performed an Hour of
Service, and subsequent computation periods shall be the Plan Year.  If there is a shift to the Plan Year, an
Employee who is credited with the number of Hours of Service to be credited
with a Year of Service in both the initial eligibility computation period and
the first Plan Year which commences prior to the first anniversary of the
Employee’s initial eligibility computation period will be credited with two (2)
Years of Service for purposes of eligibility to participate.

 

If two (2)
Years of Service are required as a condition of eligibility, a Participant will
only have completed two (2) Years of Service for eligibility purposes upon
completing two (2) consecutive Years of Service without an intervening 1-Year
Break in Service.

 

For vesting
purposes, and all other purposes not specifically addressed in this Section,
the computation period shall be the period elected in the Adoption
Agreement.  If no election is made in the
Adoption Agreement, the computation period shall be the Plan Year.

 

In determining
Years of Service for purposes of vesting under the Plan, Years of Service will
be excluded as elected in the Adoption Agreement as specified in Section 3.5.

 

Years of
Service and 1-Year Breaks in Service for eligibility purposes will be measured
on the same eligibility computation period. 
Years of Service and 1-Year Breaks in Service for vesting purposes will
be measured on the same vesting computation period.

 

Years of
Service with any Affiliated Employer shall be recognized.  Furthermore, Years of Service with any
predecessor employer that maintained this Plan shall be recognized.  Years of Service with any other predecessor
employer shall be recognized as elected in the Adoption Agreement.

 

In the event
the method of crediting service is amended from the Elapsed Time Method to the
Hour of Service Method, an Employee will receive credit for Years of Service
equal to:

 

(a)           The number of Years
of Service equal to the number of 1-year Periods of Service credited to the
Employee as of the date of the amendment; and

 

20

 

(b)           In the computation
period which includes the date of amendment, a number of Hours of Service
(using the Hours of Service equivalency method elected in the Adoption
Agreement) to any fractional part of a year credited to the Employee under this
Section as of the date of the amendment.

 

ARTICLE II

ADMINISTRATION

 

2.1.         POWERS
AND RESPONSIBILITIES OF THE EMPLOYER

 

(a)           In
addition to the general powers and responsibilities otherwise provided for in
this Plan, the Employer shall be empowered to appoint and remove the Trustee
and the Administrator from time to time as it deems necessary for the proper
administration of the Plan to ensure that the Plan is being operated for the
exclusive benefit of the Participants and their Beneficiaries in accordance
with the terms of the Plan, the Code, and the Act. The Employer may appoint
counsel, specialists, advisers, agents (including any nonfiduciary agent) and
other persons as the Employer deems necessary or desirable in connection with the  exercise
of its fiduciary duties under this Plan. The Employer may compensate such
agents or advisers from the assets of the Plan as fiduciary expenses (but not
including any business (settlor) expenses of the Employer), to the extent not
paid by the Employer.

 

(b)           The
Employer shall establish a “funding policy and method,” i.e., it shall
determine whether the Plan has a short run need for liquidity (e.g., to pay
benefits)  or whether liquidity is a long run goal and investment
growth (and stability of same) is a more current need, or shall appoint a
qualified person to do so. If the Trustee has discretionary authority, the Employer
or its delegate shall communicate such needs and goals to the Trustee, who
shall coordinate such Plan needs with its
investment policy. The communication of such a “funding policy and method”
shall not, however, constitute a directive to the Trustee as to the
investment of the Trust Funds. Such “funding policy and method” shall be
consistent with the objectives of this Plan and with the requirements of Title
I of the Act.

 

(c)           The
Employer may appoint, at its option, an Investment Manager, investment adviser,
or other agent to provide direction to the Trustee with respect to any or all
of the Plan assets.  Such appointment
shall be given by the Employer in writing in a form acceptable to the Trustee
and shall specifically identify the Plan assets with respect to which the
Investment Manager or other agent shall have the authority to direct the
investment.

 

(d)           The Employer shall periodically
review the performance of any Fiduciary or other person to whom duties
have been delegated or allocated by it under the provisions of this Plan or
pursuant to procedures established hereunder. This requirement may be satisfied
by formal periodic review by the Employer or by a qualified person specifically
designated by the Employer, through day-to-day conduct and evaluation, or
through other appropriate ways.

 

21

 

2.2          DESIGNATION
OF ADMINISTRATIVE AUTHORITY

 

The Employer
may appoint one or more Administrators. If the Employer does not appoint an
Administrator, the Employer will be the Administrator.  Any person, including, but not limited to,
the Employees of the Employer, shall be eligible to serve as an Administrator.
Any person so appointed shall signify acceptance by filing written acceptance
with the Employer.  An Administrator may
resign by delivering a written resignation to the Employer or be removed by the
Employer by delivery of written notice of removal, to take effect at a date
specified therein, or upon delivery to the Administrator if no date is
specified. Upon the resignation or removal of an Administrator, the Employer
may designate in writing a successor to this position.

 

2.3          ALLOCATION AND DELEGATION OF
RESPONSIBILITIES

 

If more than one person is appointed as Administrator, the
responsibilities of each Administrator may be specified by the Employer and
accepted in writing by each Administrator. 
In the event that no such delegation is made by the Employer, the
Administrators may allocate the responsibilities among themselves, in which
event the Administrators shall notify the Employer and the Trustee in writing
of such action and specify the responsibilities of each Administrator.  The Trustee thereafter shall accept and rely
upon any documents executed by the appropriate Administrator until such time as
the Employer or the Administrators file with the Trustee a written revocation
of such designation.

 

2.4          POWERS AND DUTIES OF THE ADMINISTRATOR

 

The primary
responsibility of the Administrator is to administer the Plan for the exclusive
benefit of the Participants and their
Beneficiaries, subject to the specific terms of the Plan. The Administrator
shall administer the Plan in accordance with its terms and shall have the power
and discretion to construe the terms of the Plan and determine all questions arising in connection with  the
administration, interpretation, and application of the Plan.  Benefits under this Plan will be paid only if the Administrator
decides in its discretion that the applicant is entitled to them. Any such
determination by the Administrator shall be conclusive and binding upon all
persons.  The Administrator may establish procedures, correct any defect, supply
any information, or reconcile any inconsistency in such manner and to such
extent as shall he deemed necessary or advisable to carry out the purpose of
the Plan; provided, however, that any procedure, discretionary act,
interpretation or construction shall be done in a nondiscriminatory manner
based upon uniform principles consistently
applied and shall be consistent with the intent that the Plan continue
to be deemed a qualified plan under the terms of Code Section 401(a), and shall
comply with the terms of the Act and all regulations issued pursuant thereto.
The Administrator shall have all powers necessary or appropriate to accomplish
its duties under this Plan.

 

22

 

The
Administrator shall be charged with the duties of the general administration of
the Plan and the powers necessary to carry out such duties as set forth under the terms of the Plan, including,
but not limited to, the following:

 

(a)           the discretion to determine all questions relating
to the eligibility of an Employee to participate or remain a Participant
hereunder and to receive benefits under the Plan;

 

(b)           the authority to review and settle
all claims against the Plan, including claims where the settlement
amount cannot be calculated or is not calculated in accordance with the Plan’s
benefit formula.  This authority
specifically permits the Administrator to settle, in compromise fashion,
disputed claims for benefits and any other disputed claims made against the
Plan;

 

(c)           to compute, certify, and direct the Trustee with respect to
the amount and the kind of benefits to which any Participant shall be
entitled hereunder;

 

(d)           to
authorize and direct the Trustee with respect to all discretionary or otherwise
directed disbursements from the Trust Fund;

 

(e)           to maintain all
necessary records for the administration of the Plan;

 

(f)            to
interpret the provisions of the Plan and to make and publish such rules for
regulation of the Plan that are consistent with the terms hereof;

 

(g)           to
determine the size and type of any Contract to be purchased from any Insurer,
and to designate the Insurer from which such Contract shall be purchased;

 

(h)           to compute and certify to the
Employer and to the Trustee from time to time the sums of money
necessary or desirable to be contributed to the Plan;

 

(i)            to consult with the Employer and the Trustee regarding
the short and long-term liquidity needs of the Plan in order that
the Trustee can exercise any investment discretion (if the Trustee has such
discretion), in a manner designed to accomplish specific objectives;

 

(j)            to prepare and implement a procedure  for notifying Participants and Beneficiaries of
their rights to elect Joint and Survivor Annuities and Pre-Retirement
Survivor Annuities if required by the Plan, Code and Regulations thereunder:

 

(k)           to
assist Participants regarding their rights, benefits, or elections available
under the Plan;

 

(l)            to
act as the named Fiduciary responsible for communicating with Participants as
needed to maintain Plan compliance with Act Section 404(c) (if the Employer
intends to comply with Act Section 404(c)) including, but not limited to, the

 

23

 

receipt and transmission of Participants’ directions as to the
investment of their accounts under the Plan and the formation of policies,
rules, and procedures pursuant to which Participants may give investment
instructions with respect to the investment of their accounts; and

 

(m)          to determine the validity of and take
appropriate action with respect to, any qualified domestic relations
order received by it.

 

2.5          RECORDS AND REPORTS

 

The
Administrator shall keep a record of all actions taken and shall keep all other
books of account, records, and other data that may be necessary for proper
administration of the Plan and shall be responsible for supplying all
information and reports to the Internal Revenue Service, Department of Labor, Participants, Beneficiaries and
others as required by law.

 

2.6          APPOINTMENT OF ADVISERS

 

The
Administrator may appoint counsel, specialists, advisers, agents (including
nonfiduciary agents) and other persons as the Administrator deems  necessary or desirable in connection with
the administration of this Plan, including but not limited to agents and
advisers to assist with the
administration and management of the Plan,
and thereby to provide, among such other duties as the Administrator may
appoint, assistance with maintaining Plan records and the providing of
investment information to the Plan’s investment fiduciaries and, if applicable,
to Plan Participants.

 

2.7          INFORMATION FROM EMPLOYER

 

The Employer
shall supply full and timely information to the Administrator on all pertinent
facts as the Administrator may require in order to perform its functions
hereunder and the Administrator shall advise the Trustee of such of the
foregoing facts as may be pertinent to the Trustee’s duties under the Plan.  The Administrator may rely upon such
information as is supplied by the Employer and shall have no duty or
responsibility to verify such information.

 

2.8          PAYMENT OF EXPENSES

 

All expenses
of administration may be paid out of the Trust Fund unless paid by the
Employer.  Such expenses shall include
any expenses incident to the functioning of the Administrator, or any person or
persons retained or appointed by any Named Fiduciary incident to the exercise
of their duties under the Plan, including, but not limited to, fees of
accountants, counsel, Investment Managers, agents (including nonfiduciary
agents) appointed for the purpose of assisting the Administrator or Trustee in
carrying out the instructions of Participants as to the directed investment of
their accounts (if permitted) and other specialists and their agents, the costs
of any bonds required pursuant to Act Section 412, and other costs of administering the Plan.  Until paid, the expenses shall constitute a
liability of the Trust Fund.

 

24

 

2.9          MAJORITY ACTIONS

 

Except where
there has been an allocation and delegation of administrative authority
pursuant to Section 2.3, if there is more than one Administrator, then they
shall act by a majority of their number, but may authorize one or more of them
to sign all papers on their behalf.

 

2.10        CLAIMS PROCEDURE

 

Claims for benefits under the Plan may he filed in writing with the
Administrator.  Written notice of the
disposition of a claim shall be furnished to the claimant within ninety (90)
days after the application is filed, or such period as is required by applicable law or Department of Labor
regulation.  In the event the claim is
denied, the reasons for the denial shall be specifically set forth in
the notice in language calculated to be understood by the claimant, pertinent
provisions of the Plan shall be cited, and, here appropriate, an explanation as
to how the claimant can perfect the claim will be provided.  In addition, the claimant shall be furnished
with an explanation of the Plan’s claims review procedure.

 

2.11        CLAIMS REVIEW PROCEDURE

 

Any Employee,
former Employee, or Beneficiary of either, who has been denied a benefit by a
decision of the Administrator pursuant to Section 2.10 shall be entitled to
request the Administrator to give further
consideration to the claim by filing with the Administrator a written request
for a hearing.  Such request, together
with a written statement of the reasons why the claimant believes such claim
should be allowed, shall be filed with the Administrator no later than sixty
(60) days after receipt of the written notification provided for in Section
2.10.  The Administrator shall then
conduct a hearing within the next sixty (60) days, at which the claimant may be
represented by an attorney or any other representative of such claimant’s
choosing and expense and at which the claimant shall have an opportunity to submit
written and oral evidence and arguments in support of the claim.  At the hearing (or prior thereto upon five
(5) business days written notice to the Administrator) the claimant or the
claimant’s representative shall have an
opportunity to review all documents in the possession of the
Administrator which are pertinent to the
claim at issue and its disallowance. 
Either the claimant or the Administrator may cause a court reporter to
attend  the hearing and record the
proceedings.  In such event, a complete
written transcript of the proceedings shall be furnished to both parties
by the court reporter.  The full expense
of any such court reporter and such transcripts shall be borne by the party
causing the court reporter to attend the hearing.  A finial decision as to the allowance of the
claim shall be made by the Administrator within sixty (60) days of receipt of
the appeal (unless there has been an extension of sixty (60) days due to
special circumstances, provided the delay and the special circumstances
occasioning it are communicated to the claimant within the sixty (60) day
period).  Such communication shall be in
a manner calculated to be understood by the claimant and shall include specific
reasons for the specific references to the pertinent Plan provisions on which
the decision is based.  Notwithstanding
the preceding, to the extent any of the time periods specified in this Section
are amended by law or Department of Labor regulation, then the time frames
specified herein shall automatically be changed in accordance with such law or
regulation.

 

25

 

If the Administrator, pursuant to the claims review procedure, makes a
finial written determination denying a  Participant’s or Beneficiary’s benefit claim, then in order to
preserve the claim, the Participant or Beneficiary must file an action
with respect to the denied claim not later
than one hundred eighty (180) days following the date of the Administrator’s
final determination.

 

ARTICLE III

ELIGIBILITY

 

3.1              CONDITIONS OF ELIGIBILITY

 

Any Eligible
Employee shall be eligible to participate hereunder on the date such Employee
has satisfied the conditions of eligibility in the Adoption Agreement.

 

3.2          EFFECTIVE DATE OF PARTICIPATION

 

An Eligible Employee who has satisfied the conditions of eligibility
pursuant to Section 3.1 shall become a Participant effective as
of the date elected in the Adoption Agreement. 
If said Employee is not employed on such date but is reemployed before a
1-Year Break in Service has occurred, then such Employee shall become a
Participant on the date of reemployment or,
if later, the date the Employee would have otherwise entered the Plan had the
Employee not terminated employment.

 

Unless
specifically provided otherwise in the Adoption Agreement, an Eligible Employee
who satisfies the Plan’s eligibility requirement conditions by reason of recognition
of service with a predecessor employer will become a Participant as of the day
the Plan credits service with a predecessor employer or, if later, the date the
Employee would have otherwise entered the Plan had the service with the
predecessor employer been service with the Employer.

 

If an Employee, who has satisfied the Plan’s eligibility requirements
and would otherwise have become a  Participant, shall go from a classification of a eligible Employee to a
Eligible Employee, such Employee shall become a Participant on the date
such Employee becomes an Eligible Employee or, if later, the date that the
Employee would have otherwise entered the Plan had the Employee always been an
Eligible Employee.

 

If an
Employee, who has satisfied the Plan’s eligibility requirements and would
otherwise become a Participant, shall go from a classification of a noneligible
Employee to an eligible class of Employees, such Employee shall become a
Participant in the Plan on the date such Employee again becomes an Eligible
Employee, or, if later, the date that the Employee would have otherwise entered
the Plan had the Employee always been an Eligible Employee.  However, if such Employee incurs a 1-Year
Break in Service, eligibility will be determined under the Break in Service
rules set forth in Section 3.5.

 

26

 

3.3                               DETERMINATION
OF ELIGIBILITY

 

The Administrator shall determine the eligibility of each Employee for
participation in the Plan based upon information furnished by the
Employer.  Such determination shall be
conclusive and binding upon all persons, as long as the same is made pursuant
to the Plan and the Act.  Such
determination shall be subject to review pursuant to Section 2.11.

 

3.4          TERMINATION OF ELIGIBILITY

 

In the event a
Participant shall go from a classification of an Eligible Employee to an
ineligible Employee, such Former Participant shall continue to vest in the Plan
for each Year of Service (or Period of Service, if the Elapsed Time Method is
used) completed while an ineligible Employee, until such time as the
Participant’s Account is forfeited or distributed pursuant to the terms of the
Plan. Additionally, the Former Participant’s interest in the Plan shall
continue to share in the earnings of the Trust Fund in the same manner as
Participants.

 

3.5          REHIRED EMPLOYEES AND BREAKS IN
SERVICE

 

(a)             If any Participant
becomes a Former Participant due to severance from employment with the Employer
and is reemployed by the Employer before a 1-Year Break in Service occurs, the
Former Participant shall become a Participant as of the reemployment date.

 

(b)             If any Participant
becomes a Former Participant due to severance from employment with the Employer and is reemployed after a 1-Year Break in
Service has occurred, Years of Service (or Periods of Service if the
Elapsed Time Method is being used) shall include Years of Service (or Periods
of Service if the Elapsed. Time Method is being used) prior to the 1-Year Break
in Service subject to the following rules:

 

(1)             In the case of a
Former Participant who under the Plan does not have a nonforfeitable right to
any interest in the Plan resulting from Employer contributions; Years of
Service (or Periods of Service) before a period of 1-Year Breaks in Service will not be taken into account it the
number of consecutive 1-Year Breaks in Service equals or exceeds the greater of
(A) five (5) or (B) the aggregate number of pre-break Years of Service (or
Periods of` Service).  Such aggregate number
of Years of Service (or Periods of Service) will not include any Years of Service
(or Periods of Service) disregarded under the preceding sentence by reason of
prior 1-Year Breaks in Service;

 

(2)             A Former
Participant who has not had Years of Service (or Periods of Service) before a
1-Year Break in Service disregarded pursuant to (1) above, shall participate in
the Plan as of the date of reemployment, or if later, as of the date the Former
Participant would otherwise enter the Plan pursuant to Sections 3.1 and 3.2
taking into account all service not disregarded.

 

(c)           After a Former
Participant who has severed employment with the Employer incurs five (5)
consecutive 1-Year Breaks in Service, the Vested portion of

 

27

 

such Former
Participant’s Account attributable to pre-break service shall not be increased
as a result of post-break service. In such case, separate accounts will be
maintained as follows:

 

(1)           one account for nonforfeitable
benefits attributable to pre-break service; and

 

(2)           one
account representing the Participant’s Employer-derived account balance in the
Plan attributable to post-break service.

 

(d)           If any Participant
becomes a Former Participant due to severance of employment with the Employer
and is reemployed by the Employer before five (5) consecutive 1-Year Breaks in
Service, and such Former Participant had received as distribution of the entire
Vested interest prior to reemployment, then the forfeited account shall be
reinstated only if the Former Participant repays the full amount which had been
distributed. Such repayment must be made before the earlier of five (5) years
after the first date on which the Participant is subsequently reemployed by the
Employer or the close of the first period of five (5) consecutive 1-Year Breaks
in Service commencing after the distribution. If a distribution occurs for any
reason other than a severance of employment, the time for repayment may not end
earlier than five (5) years after the date of distribution. In the event the
Former Participant does repay the full amount distributed, the undistributed
forfeited portion of the Participant’s Account must be restored in full,
unadjusted by any gains or losses occurring subsequent to the Valuation Date
preceding the distribution. The source for such reinstatement may be
Forfeitures occurring during the Plan Year. 
If such source is insufficient, then the Employer will contribute an
amount which is sufficient to restore the Participant’s Account, provided, however,
that if a discretionary contribution is made for such year, such contribution
will first be applied to restore any such accounts and the remainder shall be
allocated in accordance with the terms of the Plan. If a non-Vested Former
Participant was deemed to have received a distribution and such Former
Participant is reemployed by the Employer before five (5) consecutive 1-Year
Breaks in Service, then such Participant will be deemed to have repaid the
deemed distribution as of` the date of reemployment.

 

3.6          ELECTION NOT TO PARTICIPATE

 

An Employee may, subject to the approval of the Employer, elect
voluntarily not to participate in the Plan. 
The election not to participate must be irrevocable and communicated to
the Employer, in writing, within a reasonable period of time before the beginning of the first Plan Year. For standardized
Plans, a Participant or an Eligible Employee may not elect not to
participate.

 

3.7          CONTROL OF ENTITIES BY OWNER-EMPLOYEE

 

Effective with respect to Plan Years beginning after December 31, 1996,
if this Plan provides contributions
or benefits for one or more Owner-Employees, the contributions on

 

28

 

behalf of any Owner-Employee shall be made
only with respect  to the Earned
Income for such Owner-Employee which is derived from the trade or business with
respect to which such Plan is established.

 

ARTICLE IV

CONTRIBUTION AND
ALLOCATION

 

4.1          FORMULA
FOR DETERMINING EMPLOYER’S CONTRIBUTION

 

(a)                                  For a Money Purchase Plan:

 

(1)           The Employer will make contributions
on the following basis. On behalf of each
Participant eligible to share in
allocations, for each year of such
Participant’s participation  in this
Plan, the Employer will contribute the amount elected in the Adoption
Agreement. All contributions by the Employer will be made in cash. In the event
a funding waiver is obtained, this Plan shall be deemed to be an individually
designed plan.

 

(2)           Notwithstanding the foregoing, with
respect to an Employer which is not a tax-exempt entity, the Employees
contribution for any Fiscal Year shall not exceed the maximum amount allowable
as a deduction to the Employer under the provisions of Code Section 404.
However, to the extent necessary to provide the top heavy minimum allocations,
the Employer shall make a contribution even if it exceeds the amount that is
deductible under Code Section 404.

 

(b)           For
a Profit Sharing Plan:

 

(1)           For each Plan Year, the Employer may
(or will in the case of a Prevailing Wage contribution) contribute to the Plan
such amount as elected by the Employer in the Adoption Agreement.

 

(2)           Additionally,
the Employer  will contribute to the Plan the amount necessary, if
any, to provide the top heavy minimum allocations, even if it exceeds current or accumulated Net Profit
or the amount that is deductible under Code Section 404.

 

4.2          TIME OF PAYMENT OF EMPLOYER’S
CONTRIBUTION

 

Unless
otherwise provided by contract or law, the Employer may make its contribution
to the Plan for a particular Plan Year at
such time as the Employer, in its sole discretion, determines.  If the Employer makes a contribution for a
particular Plan Year after the close of that Plan Year, the Employer will
designate to the Administrator the Plan Year for which the Employer is making
its contribution.

 

29

 

4.3            ALLOCATION
OF CONTRIBUTION, FORFEITURES AND EARNINGS

 

(a)           The Administrator
shall establish and maintain an account in the name of each Participant to
which the Administrator shall credit as of each Anniversary Date, or other
Valuation Date, all amounts allocated to each such Participant as set forth
herein.

 

(b)           The Employer shall
provide the Administrator with all information required by the Administrator to
make a proper allocation of the Employer’s contribution, if any, for each Plan
Year. Within a reasonable period of time after the date of receipt by the
Administrator of such information, the Administrator shall allocate any
contributions as follows:

 

(1)           For a Money Purchase
Plan (other than a Money Purchase Plan which is integrated by allocation):

 

(i)            The Employer’s
contribution shall be allocated to each Participant’s
Account in the manner set forth in Section 4.1 herein and as specified
in the Adoption Agreement.

 

(ii)           However, regardless of the preceding,
a Participant shall only be eligible to share in the allocations of the
Employer’s contribution for the year if the conditions set forth in the
Adoption Agreement are satisfied, unless a
top heavy contribution is required pursuant to Section 4.3(f).  If no election is made in the Adoption
Agreement, then a Participant shall be eligible to share in the allocation of
the Employer’s contribution for the year if the Participant completes more than
five hundred (500) Hours of Service for three (3) Months of Service if the
Elapsed Time method is chosen in the Adoption Agreement) during the Plan Year
or who is employed on the last day of the Plan Year.  Furthermore, with respect to a
non-standardized Adoption Agreement, regardless of any election in the Adoption
Agreement to the contrary, for the Plan Year in which this Plan terminates, a Participant shall only be eligible to share in
the allocation of the Employer’s contributions for the Plan Year if the
Participant is employed at the end of the Plan Year and has completed a Year of
Service (or Period of Service if the Elapsed
Time Method is elected).

 

(2)           For an integrated Profit Sharing Plan allocution
or a Money Purchase Plan which is integrated by. allocation:

 

(i)            Except as provided in Section 4.3(f)
for top heavy purposes and subject to the “Overall Permitted Disparity Limits,”
the Employer’s contribution shall be allocated to each Participant’s Accounts
in a dollar amount equal to 5.7% of the sum of each Participant’s Compensation
plus Excess Compensation.  If the
Employer does not contribute such amount of all Participant’s, each
Participant’s Compensation plus Excess Compensation for the Plan Year bears to
the total Compensation plus the total

 

30

 

Excess
Compensation of all Participants for that year. 
However,  in the case of any
Participant who has exceeded the “Cumulative Permitted Disparity Limit,” the
allocation set forth in this paragraph shall be based on such Participant’s
Compensation rather than Compensation plus Excess Compensation.

 

Regardless of the preceding, 4.3% shall be substituted for 5.7% above
if Excess Compensation is based on more than 20% and less than or equal to 80%
of the Taxable Wage Base.  If Excess
Compensation is based on less than 100% and more than 80% of the Taxable Wage
Base, then 5.4% shall be substituted for 5.7%
above.

 

(ii)           The balance of the Employer’s
contribution over the amount allocated above, if any, shall be allocated to
each Participant’s Account in the same proportion that each such Participant’s
Compensation for the Year bears to the total Compensation of all Participants
for such year.

 

(iii)          However, regardless
of the preceding, a Participant shall only be eligible to share in the
allocations of the Employer’s Contribution for the year if the conditions set forth in the Adoption Agreement are
satisfied, unless as contribution is required pursuant to Section 4.3(f).  If no election is made in the Adoption
Agreement, then a Participant shall be eligible to share in the allocation of
the Employer’s contribution for the year if the Participant completes more than
five hundred (500) Hours of Service (or three (3) Months of Service if the
Elapsed Time method is chosen in the Adoption Agreement) during the Plan Year
or who is employed on the last day of the Plan Year.  Furthermore, with respect to a
non-standardized Adoption Agreement, regardless
of any election in the Adoption Agreement to the contrary, for the Plan
Year in which this Plan terminates, a Participant shall only be eligible to
share in the allocation of the Employer’s contributions for the Plan Year if
the Participant is employed at the end of the Plan Year
and has completed a Year of Service (or Period of Service if the
Elapsed Time Method is elected).

 

(3)                                  For a Profit Sharing Plan with a non-integrated
allocation formula or a Prevailing Wage contribution:

 

(i)                                     The Employer’s contribution shall be allocated to
each Participant’s Account in accordance with the allocation method elected in
the Adoption Agreement.

 

(ii)                                  However, regardless of the preceding, a
Participant shall only be eligible to share in the allocations of the
Employer’s contribution for the year if the conditions set forth in the
Adoption Agreement are satisfied, unless a top heavy contribution is required
pursuant to Section 4.3( f).  If no
election is made in the Adoption Agreement, then a Participant shall be

 

31

 

eligible to share in the allocation of the
Employees contribution for the year if the Participant completes more than five
hundred (500) Hours of Service (or three (3) Months of Service if the Elapsed
Time method is chosen in the Adoption Agreement) during the Plan Year or who is
employed on the last day of the Plan Year. 
Furthermore, with respect to a non-standardized Adoption Agreement,
regardless of any election in the Adoption Agreement to the contrary, for the
Plan Year in which this Plan terminates, a Participant shall only be eligible
to share in the allocation of the Employer’s contributions for the Plan Year if
the Participant is employed at the end of the Plan Year and has completed a
Year of Service (or Period of Service if the Elapsed Time Method is elected).

 

(4)                                  “Overall Permitted Disparity Limits”:

 

“Annual
Overall Permitted Disparity Limit”: 
Notwithstanding the preceding paragraphs, if in any Plan “benefits” any
Participant who “benefits” under another qualified plan or simplified employee
pension, as defined in Code Section 408(k), maintained by the Employer that
either provides for or imputes permitted disparity (integrates), then such
plans will be considered to be one plan and will be considered to comply with
the permitted disparity rules if the extent of the permitted disparity of all
such plans does not exceed 100%.  For purposes of the preceding sentence, the
extent of the permitted disparity of a plan is the ratio, expressed as a
percentage, which the actual benefits, benefit rate, offset rate, or employer
contribution rate, whatever is applicable under the Plan, bears to the
limitation under Code Section 401(I)
applicable to such Plan. 
Notwithstanding the foregoing, if the Employer maintains two or more
standardized paired plans, only one plan may provide for permitted disparity.

 

“Cumulative
Permitted Disparity Limit”:  With respect
to a Participant who “benefits” or
“has benefited” under a defined benefit or target benefit plan of the Employer,
effective for Plan Years beginning on or after January 1, 1994, the cumulative
permitted disparity limit for the Participant is thirty five (35) total cumulative permitted disparity years.
Total cumulative permitted disparity years means the number of years credited
to the Participant for allocation or accrual purposes under the Plan,  any
other qualified plan or simplified employee pension plan (whether or not
terminated) ever maintained by the Employer, while such plan either provides for or imputes permitted
disparity.  For purposes of determining
the Participant’s cumulative permitted disparity limit, all years ending in the
same calendar year are treated as the same year. If the Participant has not
“benefited” under a defined benefit or target benefit plan which neither
provides for nor imputes permitted disparity for any year beginning on or after
January 1, 1994, then such Participant has no cumulative disparity limit.

 

32

 

For purposes
of this Section “benefiting” means benefiting under the Plan for any Plan Year
during which Participant received or deemed receive an allocation in accordance  with Regulation 1.410(b)-3(a).

 

(c)                                  Except as otherwise elected in the Adoption
Agreement or as provided in Section 4.10 with respect to Participant
Directed Accounts, as of each Valuation Date, before allocation of any Employer
contributions and Forfeitures, any earnings or losses (net appreciation or net
depreciation) of the Trust Fund (exclusive of assets segregated for
distribution) shall be allocated in the same proportion that each Participant’s
and Former Participant’s nonsegregated
accounts bear to the total of all Participants’ and Former Participants’
nonsegregated accounts as of such date. If any nonsegregated account of
a Participant has been distributed prior to the Valuation Date subsequent to a
Participant’s termination of employment, no earnings or losses shall be
credited to such account.

 

(d)                                 Participants’ Accounts shall be debited for any
insurance or annuity premiums paid, if any, and credited with any
dividends or interest received on Contracts.

 

(e)                                  On
or before each Anniversary Date, any amounts which became Forfeitures since the
last Anniversary Date may be made available to reinstate previously forfeited
account balances of Former Participants, if any, in accordance with Section
3.5(d) or used to satisfy any contribution that may be required pursuant to
Section 6.9.  The remaining Forfeitures,
if any, shall be treated in accordance with the Adoption Agreement.  If no election is made in the Adoption
Agreement, any remaining Forfeitures wi1l be
used to reduce any future Employer contributions under the Plan. However, if the Plan provides for an integrated allocation, then any remaining
Forfeitures will be  added
to the Employer’s contributions under
the Plan. Regardless of the preceding sentences, in the event the allocation of
Forfeitures provided herein shall cause the “Annual Additions” (as defined in
Section 4.4) to any Participant’s Account to exceed the amount allowable by the
Code, an adjustment shall be made in accordance with Section 4.5.  Except, however, a Participant shall only be
eligible to share in the allocations of Forfeitures for the year if the
conditions set forth in the Adoption Agreement are satisfied, unless a top
heavy contribution is required pursuant to Section 4.3(f).  If no election is made in the Adoption
Agreement, then a Participant shall be eligible to share in the allocation of
the Employees contribution for the year if the Participant completes more than
five hundred (500) Hours of Service for three (3) Months of Service if the
Elapsed Time method is chosen in the Adoption Agreement during the Plan Year or
who is employed on the Last day of the Plan Year.

 

(f)                                    Minimum
Allocations Required for Top Heavy Plan Years: Notwithstanding the foregoing,
for any Top Heavy Plan Year, the sum of the Employer’s contributions and Forfeitures
allocated to the Participant’s Combined Account of each Non-Key Employee shall
be equal to at least three percent (3%) of such Non-Key

 

33

 

Employee’s 415
Compensation (reduced by contributions and forfeitures, if any, allocated to
each Non-Key Employee in any defined contribution plan included with this Plan
in a “required aggregation group” (as defined in Section 9.2(f)).  However, if (i) the sum of the Employer’s
contributions and Forfeitures allocated to the Participant’s Combined Account
of each Key Employee for such Top Heavy Plan Year is less than three percent
(3%) of each Key Employee’s 415 Compensation and (ii) this Plan is not required
to be included in a “required aggregation group” (as defined in .Section
9.2(f)) to enable a defined benefit plan to meet the requirements of Code
Section 401( a)(4) or 410, the sum of the Employee contributions and
Forfeitures allocated to the Participant’s Combined Account of each Non-Key
Employee shall be equal to the largest percentage allocated to the
Participant’s Combined Account of any Key Employee.

 

However, for each Non-Key Employee who is a
Participant in a paired Profit Sharing Plan or 401(k) Profit Sharing Plan and a
paired Money Purchase Plan, the minimum three percent (3%) allocation specified
above shall be provided in the Money Purchase Plan.

 

If this is an integrated Plan, then for any
Top Heavy Plan Year the Employer’s contribution shall be
allocated as follows and shall still
be required to satisfy the other provisions of this subsection:

 

(1)                             An
amount equal to three percent (3%) multiplied by each Participant’s
Compensation for the Plan Year shall be
allocated to each Participant’s Account. 
If the Employer does not contribute
such amount for all Participants, the amount shall be allocated to each
Participant’s Account in the same proportion that such Participant’s total
Compensation for the Plan bears to the total Compensation of all Participants for
such year.

 

(2)                             The
balance of the Employer’s contribution over the amount allocated under
subparagraph (1) hereof shall be allocated to each Participant’s Account in a
dollar amount equal to three percent (3%) multiplied
by a Participant’s Excess Compensation. If the Employer does not contribute
such amount for all Participants, each Participant will be allocated a
share of the contribution in the same proportion that such Participant’s
Excess Compensation bears to the total Excess Compensation of all Participants
for that year. For purposes of this paragraph, in the case of any Participant
who has exceeded the cumulative permitted disparity limit described in Section
43(b)(4) such Participant’s total Compensation will be taken into account.

 

(3)                            The
balance of the Employer’s contribution
over the amount allocated under subparagraph (2) hereof shall be allocated to each Participant’s Account in a dollar
amount equal to 2.7% multiplied by the sum  of each Participant’s total Compensation plus Excess Compensation.  If the
Employer does not contribute such amount for all Participants, each
Participant will be allocated a share of the contribution in the same
proportion that such Participant’s total Compensation plus Excess Compensation
for the Plan Year bears to the total Compensation

 

34

 

plus Excess Compensation of all Participants for that year. For
purposes of this paragraph, in the case of any Participant who has exceeded the
cumulative permitted disparity limit described in Section 4.3(b)(4), such Participant’s
total Compensation rather than Compensation plus Excess Compensation will be taken into account.

 

Regardless of the preceding, 1.3% shall be substituted for 2.7% above
if Excess Compensation is based on more than 20% and less than or equal to 80%
of the Taxable Wage Base. If Excess Compensation is based on less than 100% and
more than 80% of the Taxable Wage Base, then 2.4% shall he substituted for 2.7%
above.

 

(4)                             The
balance of the Employer’s contributions over the amount allocated above, if any,
shall be allocated to each Participant’s Account in the same proportion that
such Participant’s total Compensation for the Plan Year bears to the total
Compensation of all Participants for such year.

 

For each Non-Key Employee who is a Participant in this Plan and another
non-paired defined contribution plan
maintained by the Employer, the minimum three percent (3%) allocation specified
above shall be provided as specified in the Adoption Agreement.

 

(g)                            For purposes of the minimum
allocations set forth above, the percentage allocated to the Participant’s
Combined Account of any Key Employee shall be equal to the ratio of the sum of
the Employer’s contributions and Forfeitures
allocated on behalf of such Key Employee divided by the 415 Compensation for such
Key Employee.

 

(h)                            For any Top Heavy Plan
Year, the minimum allocations set forth in this Section shall be allocated to
the Participant’s Combined Account of all Non-Key Employees who are
Participants and who are employed by the Employer on the last day of the Plan
Year, including Non-Key Employees who have (1) failed to complete a Year of Service; or (2) declined to make mandatory
contributions (if required) or, in the case of a cash or deferred arrangement,
Elective Deferrals to the Plan.

 

(i)                                Notwithstanding
anything herein to the contrary, in any Plan Year in which the Employer
maintains both this Plan and a defined benefit pension plan included in a
“required aggregation group” (as defined in Section 9.2(f) which is top heavy,
the Employer will not be required (unless otherwise elected in the Adoption
Agreement) to provide a Non-Key Employee with both the full separate minimum
defined benefit plan benefit and the full separate defined contribution plan
allocations. In such case, the top heavy minimum benefits will be provided as
elected in the Adoption Agreement and, if applicable, as follows:

 

35

 

(1)                            If the 5% defined
contribution minimum is elected in the Adoption Agreement:

 

(i)                                     The requirements of Section 9.1 will apply except
that each Non-Key Employee who is a  Participant
in the Profit  Sharing Plan or
money Purchase Plan and who is also a
Participant in the Defined Benefit Plan will receive a minimum
allocation of five percent (5%) of such Participant’s 415 Compensation from the
applicable defined contribution plan(s).

 

(ii)                                  For each Non-Key Employee who is a Participant
only in the Defined Benefit Plan the Employer will provide a minimum
non-integrated benefit equal to two percent (2%) of such Participant’s highest five (5) consecutive year
average 415 Compensation for each Year of Service while a participant in
the plan, in which the Plan is top heavy, not to exceed ten (10).

 

(iii)                               For
each Non-Key Employee who is a Participant Only  in this defined contribution plan,
the Employer will provide a minimum
allocation equal to three percent (3%) of such Participant’s 415
Compensation.

 

(2)                             If the 2%
defined benefit minimum is elected in the Adoption Agreement, then for each
Non-Key Employee who is a Participant only in the defined benefit plan,
the Employer will provide a minimum non-integrated benefit equal to two percent   (2%) of such Participant’s
highest five (5) consecutive year average of
415 Compensation for each Year of Service while a participant in the Plan, in
which the Plan is top heavy, not to  exceed
ten (10).

 

(j)                                For the purposes of this Section, 415 Compensation will be limited to the same dollar
limitations set forth in Section 1.11  adjusted
in such  manner as
permitted under Code Section 415(d).

 

(k)                             Notwithstanding anything
in this Section to the contrary, all information necessary to properly reflect
a given transaction may not be available until after the date specified herein
for processing such transaction, in which case the transaction will be reflected when such information is
received and processed. Subject to express limits that may be imposed under the
Code, the processing of any  contribution,
distribution or other transaction may be delayed for any legitimate business
reason (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). The
processing date of a transaction will be binding for all purposes of the Plan.

 

(l)                                     Notwithstanding
anything in this Section to the contrary, the provisions of this subsection
apply for any Plan Year if, in the non-standardized Adoption Agreement, the
Employer elected to apply the 410(b) ratio percentage failsafe provisions and
the Plan fails to satisfy the “ratio percentage  test” due to a
last day of the Plan Year allocation condition or an Hours of Service (or months of service)
allocation condition. A plan satisfies the “ratio percentage test” if, on the
last of the Plan Year, the “benefiting ratio”

 

36

 

of the Highly Compensated Employees who are
“includible” is at least 70% of the “benefiting ratio” of the Highly
Compensated Employees who are “includible.” The “benefiting ratio” of the
Non-Highly Compensated Employees is the number of “includible”  Non-Highly
Compensated Employees “benefiting” under the Plan divided by the number of “includible”
Employees who are Non-Highly Compensated “benefiting ratio” of the Highly
Compensated Employees is the number of Highly Compensated Employees
“benefiting” under the Plan divided by the number of “includible” Highly
Compensated Employees, “Includible” Employees are all Employees other than: (1)
those Employees excluded from participating in the plan for the entire Plan
Year by reason of the collective bargaining unit exclusion or the nonresident
alien exclusion described in the Code or by reason of the age and service
requirements of Article III; and (2) any Employee who incurs a separation from
service during the Plan Year and fails to complete at least 501 Hours of
Service (or three (3) months of service if the Elapsed Time Method is being
used) during such Plan Year.

 

For purposes of this subsection, an Employee is “benefiting” under the
Plan on a particular date if, under the Plan,
the Employee is entitled to an Employer contribution or an allocation of
Forfeitures for the Plan Year.

 

If this subsection applies, then the
Administrator will suspend the allocation conditions for the “includible”
on-Highly Compensated Employees who are Participants, beginning first with the
“includible” Employees employed by the Employer on the last day of the Plan
Year, then the “includible” Employees who have the latest separation from
service during the Plan Year, and continuing to suspend the allocation
conditions for each “includible” Employee who incurred an earlier separation
from service, from the latest to the earliest separation from service date,
until the Plan satisfies the “ratio percentage test” for the Plan Year. If two
or more “includible” Employees have a separation from service on the same day,
then the Administrator will suspend the allocation conditions for all
“includible” Employees, irrespective of whether the Plan can satisfy the “ratio
percentage test”  by accruing benefits for fewer than all such
“includible” Employees. If the Plan for any Plan Year suspends the allocation
conditions for an Includible Employee, then that Employee will share in the
allocation for that Plan Year of the Employer contribution and
Forfeitures, if any, without regard to whether the Employee has satisfied the
other allocation conditions set forth in this
Section.

 

4.4                               MAXIMUM ANNUAL ADDITIONS

 

(a)(1)                    If
a Participant does not participate in, and has never participated in another
qualified plan maintained by the Employer, or a welfare benefit fund (as
defined in Code Section 419(e)) maintained by the Employer, or an individual
medical account (as defined in Code Section 415(1)(2)) maintained by the
Employer, or a simplified employee pension (as defined in Code Section 408(k))
maintained by the Employer which provides “Annual Additions,” the amount of “Annual
Additions,” which may be credited to the Participant’s accounts for any
Limitation Year shall not exceed the lesser of the “Maximum Permissible Amount”
or any other limitation contained in this Plan. 
If

 

37

 

the Employer
contribution that would otherwise be contributed or allocated to the Participant’s
accounts would cause the “Annual Additions” for the Limitation Year to exceed
the “Maximum Permissible Amount,” the amount contributed or allocated will be
reduced so that the “Annual Additions” for the Limitation Year swill equal the
“Maximum Permissible Amount,” and any
amount in excess of the “Maximum
Permissible Amount” which would have been allocated to such Participant
may be allocated to other Participants.

 

(2)                                         Prior
to determining the Participant’s actual 415 Compensation for the Limitation
Year, the Employer may determine the “Maximum Permissible Amount” for a
Participant on the basis of a reasonable estimation of the Participant’s 415
Compensation for the Limitation Year,
uniformly determined for all Participants similarly situated.

 

(3)                                         As
soon as is administratively feasible after the end of the Limitation Year the “Maximum
Permissible Amount”  for
such Limitation Year shall be determined on the basis of the Participant’s
actual 415 Compensation for such Limitation Year.

 

(b)(1)                          This subsection applies if, in addition to this
Plan, a Participant is covered under another qualified  defined contribution plan maintained by the
Employer that  is a “Master or
Prototype Plan,” a welfare benefit fund (as defined in Code Section
419(e)) maintained by the Employer, an  individual medical
account (as defined in Code Section
415(1)(2)) maintained by the Employer, or a simplified employee pension (as
defined in Code Section 408( k))  maintained
by the Employer, which provides “Annual Additions,” during any Limitation Year.
The “Annual Additions” which
may be credited to a Participant’s
accounts under this Plan for any such Limitation Year shall not exceed the
“Maximum Permissible Amount” reduced by the “Annual Additions” credited to a
Participant’s accounts under the other plans and welfare benefit funds,
individual medical accounts, and simplified employee pensions for the same
Limitation Year.  If the “Annual Additions”
with respect to the Participant under other defined contribution plans and
welfare benefit funds maintained by the Employer are less than the “Maximum
Permissible Amount” and the Employer contribution that would otherwise be
contributed or allocated to the Participant’s accounts under this Plan would
cause the “Annual Additions” for  the Limitation Year to exceed this
limitation, the amount contributed or allocated will he reduced, so that the “Annual Additions” under all such plans and welfare benefit funds for
the Limitation Year will equal the “Maximum Permissible Amount,’ and any amount
in excess of the “Maximum Permissible Amount” which would have been allocated
to such Participant may be allocated to other Participants. If the “Annual
Additions” with respect to the Participant under such other defined
contribution plans, welfare benefit funds, individual medical accounts and
simplified employee pensions in the aggregate are equal to or greater than the
“Maximum Permissible Amount.” No amount will be contributed or allocated to the
Participant’s account under this Plan for the Limitation Year.

 

38

 

(2)                                  Prior
to determining the Participant’s actual 415 Compensation for the Limitation
Year, the Employer may determine the “Maximum Permissible Amount” for a
Participant on the basis of a reasonable estimation of the Participant’s 415
Compensation for the Limitation Year, uniformly determined for all Participants
similarly situated.

 

(3)                                  As
soon as is administratively feasible after the end of the Limitation Year, the “Maximum
Permissible Amount” for the  Limitation
Year will be determined on the basis of the Participant’s actual 415
Compensation for the Limitation Year.

 

(4)                                  If,
pursuant to Section 4.4(b)(2) or Section 4.5. a Participant’s “Annual
Additions” under this Plan and such other plans would result in an “Excess
Amount”  for a Limitation Year, the “Excess Amount” will be deemed to
consist of the “Annual Additions” last allocated, except that “Annual Additions”
attributable to a simplified employee pension will be deemed to have been
allocated first, followed by “Annual Additions” to a welfare benefit fund or
individual medical account, and then by “Annual Additions” to a plan subject to
Code Section 412, regardless of the actual allocation date.

 

(5)                                  If
an “Excess Amount” was allocated to a Participant on an allocation date of this
Plan which coincides with an allocation date of another plan, the “Excess
Amount” attributed to this Plan will be the product of:

 

(i)                                     the
total “ Excess Amount” allocated as of such date, times.

 

(ii)                                  the
ratio of (1) the “Annual Additions” allocated to the Participant for the
Limitation Year as of such date under this Plan to (2) the total “Annual
Additions” allocated to the Participant for the Limitation Year as of such date
under this and all the other qualified defined contribution plans.

 

(6)                                  Any
“Excess Amount” attributed to this Plan will be disposed of in the manner
described in Section 4.5.

 

(c)                                  If the Participant is
covered under another qualified defined contribution plan maintained by the
Employer which is not a “Master or Prototype Plan.” “Annual Additions” which
may be credited to the Participants Combined Account under this Plan for any
Limitation Year will be limited in accordance with Section 4.4(b), unless
in the Adoption Agreement.

 

(d)                                 For any Limitation
Year beginning prior to the date the Code Section 415(e) limits are
repealed with respect to this Plan (as specified in the Adoption Agreement for
the GUST transitional rules), if the Employer maintains or at any tine
maintained, a qualified defined benefit plan covering any Participant  in this Plan, then the sum of the
Participant’s “Defined Benefit Plan Fraction” and “Defined
Contribution

 

39

 

Plan Fraction” may not exceed 1.0. In such event, the rate of accrual
in the defined benefit plan will be reduced to the extent necessary so that the
sum of the “Defined_ Contribution Fraction” and “Defined Benefit Fraction” will
equal 1.0.  However, in the Adoption
Agreement the Employer may specify an alternative method under which the plans
involved will satisfy the limitations of Code Section 415(e), including
increased top heavy minimum benefits so that the combined limitation is 1.25
rather than 1.0.

 

(e)           For purposes of
applying the limitations of Code Section 415, the transfer of funds from one
qualified plan to another is not an “Annual Addition.”  In addition, the following are not Employee
contributions for the purposes of Section 4.4(f)(1)(b); (1 ) rollover
contributions (as defined in Code Sections 402(c) 403(a)(4), 403(b)(8) and
408(d)(3)); (2) repayments of loans made to a Participant front the Plan: (3)
repayments of distributions received by an Employee pursuant to Code Section
411(a)(7)(B) (cash-outs); (4) repayments of distributions received by an
Employee pursuant to Code Section 411(a)(3)(D) (mandatory contributions); and
(5) Employee contributions to a simplified employee pension excludable from
gross income under Code Section 408(k)(6).

 

(f)                                    For
purposes of this Section, the following terms shall be defined as follows:

 

(1)                                  “Annual
Additions” means the sum credited to a Participant’s accounts for any
Limitation Year of (a) Employer contributions (b) Employee
contributions (except as provided below), (c) forfeitures, (d) amounts
allocated, after March 31, 1984, to an individual medical account, as defined
in Code Section 415(1)(2), which is part of a pension or annuity plan
maintained by the Employer (e) amounts derived from contributions paid or
accrued after December 31, 1985, in taxable years ending after such date,
which are 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 (f) allocations under a simplified employee
pension. Except, however, the Compensation percentage limitation referred to in
paragraph (f)(9)(ii) shall not apply to: 
(1) any contribution for medical benefits (within the  meaning of Code section 419(f)(2)) after
separation from service which is otherwise treated as an “Annual Addition,” or (2) any
amount otherwise treated as an “Annual Addition” under Code Section 415(1)(l).
Notwithstanding the foregoing, for Limitation Years beginning prior to January 1,
1987, only that portion of Employee contributions equal to the lesser of
Employee contributions in excess of six percent (6%) of 415 Compensation or
one-half of Employee contributions shall be considered an “Annual Addition.”

 

For this purpose, any Excess Amount applied
under Section 4.5 in the Limitation Year to reduce Employer contributions
shall be considered “Annual Additions” for such Limitation Year.

 

40

 

(2)                                  “Defined
Benefit Fraction” means a fraction, the numerator of which is the sum of the
Participants “Projected Annual Benefits” under all the defined benefit plans
(whether or not terminated ) maintained by the Employer, and the denominator of
which is the lesser of one hundred twenty-five percent (125%) of the dollar
limitation determined for the Limitation Year under Code Sections 415(b)(1)(A) as
adjusted by Code Section 415(d) or one hundred forty percent (140%)
of the “Highest Average Compensation” including any adjustments under Code Section 415(b).

 

Notwithstanding the above, if the Participant
was a Participant as of the first day of the first Limitation Year beginning
after December 31, 1986, in one or more defined benefit plans maintained
by the Employer which were in existence on May 6, 1986, the denominator of
this fraction will not be less than one hundred twenty five percent (125%) of
the sum of the annual benefits under such plans which the Participant had
accrued as of the end of the close of the last Limitation Year beginning before
January 1, 1987, disregarding any changes in the terms and conditions of
the plan after May 5, 1986. The preceding sentence applies only if the
defined benefit plans individually and in the aggregate satisfied the
requirements of Code Section 415 for all Limitation Years beginning before
January 1, 1987.

 

Notwithstanding the foregoing, for any Top
Heavy Plan Year, one hundred percent (100%) shall be substituted for one
hundred twenty-five percent (125%) unless the extra top heavy minimum
allocation or benefits is being made pursuant to the Employer’s specification
in the Adoption Agreement. However, for any Plan Year in which this Plan is
Super Top Heavy Plan, one hundred percent (100%) shall always be substituted
for one hundred twenty-five percent (125%).

 

(3)                                  Defined
Contribution Dollar Limitation means $30,000 as adjusted under Code Section 415(d).

 

(4)                                  Defined
Contribution Fraction means a fraction, the numerator of which is the sum of
the “Annual Additions” to the Participant’s accounts under all the defined
contribution plans (whether or not terminated) maintained by the Employer for
the current and all prior “Limitation Years.” 
(including the “Annual Additions” attributable to the Participant’s
nondeductible voluntary employee contributions to any defined benefit plans,
whether or not terminated, maintained by the Employer and the “Annual Additions”
attributable to all welfare benefit funds (as defined in Code Section 419(e)),
individual medical account (as defined in Code Section 415(1)(2)), and
simplified employee pensions (as defined in Code Section 408(k))
maintained by the Employer), and the denominator of which is the sum of the “Maximum
Aggregate Amounts” for the current and all prior Limitation Years in which the
Employee had service with the Employer (regardless of whether a defined
contribution plan was maintained by the Employer). The maximum aggregate amount
in any Limitation Year is the lesser of one hundred twenty-five percent (125%)
of the dollar limitation determined under Code Section 415(c)(1)(A) as
adjusted by Code Section 415(d) or thirty-five percent (35%) of the
Participant’s 415 Compensation for such Year.

 

41

 

If the Employee was a Participant as of the
end of the first day of the first Limitation Year beginning after December 31,
1986 in one or more defined contribution plans maintained by the Employer which
were in existence on May 5, 1986, the numerator of this fraction will be
adjusted if the sum of this fraction, and the “Defined Benefit Fraction” would
otherwise exceed 1.0 under the terms of this Plan.  Under the adjustment, an amount equal to the
product of (1) the excess of the sum of the fractions over 1.0 times (2) the
denominator of this fraction will be permanently subtracted from the numerator
of this fraction.  The adjustment is
calculated using the fractions as they will be computed as of the end of the
last Limitation Year beginning before January 1, 1987, and disregarding
any changes in the terms and conditions of the plan made after May 5,
1986, but using the Code Section 415 limitation applicable to the first
Limitation Year beginning on or after January 1, 1987.

 

For Limitation Years beginning prior to January 1,
1987, the “Annual Additions” shall not be recomputed to Employee contributions
as “Annual Additions”:

 

Notwithstanding the foregoing, for any Top
Heavy Plan Year, one hundred percent (100%) shall be substituted for one
hundred twenty-five percent (125%) unless the extra top heavy minimum
allocation or benefit is being made pursuant to the Employer’s specification in
the Adoption Agreement.  However, for any
Plan Year in which this Plan is a Super Top Heavy Plan, one hundred percent
(100%) shall always be substituted for one hundred twenty-five percent (125%).

 

(5)                                  “Employer”
means the Employer that adopts this Plan and all Affiliated Employers, except
that for purposes of this Section, the determination of whether an entity is an
Affiliated Employer shall be made by applying Code Section 415(h).

 

(6)                                  “Excess
Amount” means the excess of the Participant’s “Annual Additions” for the
Limitation Year over the “Maximum Permissible Amount.”

 

(7)                                  “Highest
Average Compensation” means the average Compensation for the three (3) consecutive
Years of Service with the Employer while a Participant in the Plan that
produces the highest average.  A Year of
Service with the Employer is the twelve (12) consecutive month period ending on
the last day of the Limitation Year.

 

(8)                                  “Master
or Prototype Plan” means a plan the form of which is the subject of a favorable
opinion letter from the Internal Revenue Service.

 

42

 

(9)                                  “Maximum
Permissible Amount” means the maximum Annual Addition that may be contributed
or allocated to a Participant’s accounts under the Plan for any “Limitation
Year,” which shall not exceed the lesser of:

 

(i)                                     the
“Defined Contribution Dollar Limitation,” or

 

(ii)                                  twenty-five
percent (25%) of the Participant’s 415 Compensation for the “Limitation Year.”

 

The Compensation Limitation referred to in (ii) shall
not apply to any contribution for medical benefits within the meaning of Code
Sections 401(h) or 419A(f)(2) which is otherwise treated as an “Annual
Addition.”

 

If a short Limitation Year is created because
of an amendment changing the Limitation Year to a different twelve (12)
consecutive month period, the “Maximum Permissible Amount” will not exceed the “Defined
Contribution Dollar Limitation” multiplied by a fraction, the numerator of
which is the number of months in the short Limitation Year and the denominator of
which is twelve (12).

 

(10)                            “Projected
Annual Benefit” means the annual retirement benefit (adjusted to an actuarially
equivalent “straight life annuity” if such benefit is expressed in a form other
than a “straight life annuity” or qualified joint and survivor annuity) to
which the Participant would be entitled under the terms of the plan assuming:

 

(i)                                     the
Participant will continue employment until Normal Retirement Age (or current
age, if later), and

 

(ii)                                  the
Participant’s 415 Compensation for the current Limitation Year and all other
relevant factors used to determine benefits under the Plan will remain constant
for all future Limitation Years.

 

For purposes of this subsection, “straight life annuity” means an
annuity that is payable in equal installments for the life of the Participant
that terminates upon the Participant’s death.

 

(g)                                 Notwithstanding
anything contained in this Section to the contrary, the limitations,
adjustments and other retirements prescribed in this Section shall at all
times comply with the provisions of Code Section 415 and the Regulations
thereunder.

 

4.5                               ADJUSTMENT
OR EXCESSIVE ANNUAL ADDITIONS

 

Allocation of “Annual Additions” (as defined in Section. 4.4) to a
Participant’s Combined Account for a Limitation Year generally will cease once
the limits of Section 4.4 have been reached for such Limitation Year.  However, if as a result of the allocation of
Forfeitures, a reasonable error in estimating a Participant’s annual
415 Compensation, a reasonable error in

 

43

 

determining the amount of elective deferrals (within the meaning of
Code Section 402(g(3)) that may be made with respect to any Participant
under the limits of Section 4.4, or other facts and circumstances to which
Regulation 1.415-6(b)(6) shall be applicable, the “Annual Additions” under
this Plan would cause the maximum provided in Section 4.4 to be exceeded,
the “Excess Amount” will be disposed of in one of the following manners, as
uniformly determined by the Plan Administrator for all Participants similarly
situated:

 

(a)                                  Any after-tax
voluntary Employee contributions (plus attributable gains) to the extent they
would reduce the Excess Amount that will be distributed to the Participant;

 

(b)                                 If, after the
application of subparagraph (a), an “Excess Amount” still exists, any unmatched
Elective Deferrals (and for Limitation Years beginning after December 31,
1995, any gains attributable to such Elective Deferrals), to the extent they
would reduce the Excess Amount, will be distributed to the Participant;

 

(c)                                  To the extent
necessary, matched Elective Deferrals and Employer matching contributions will
be proportionately reduced from the Participant’s Account. The Elective
Deferrals (and for Limitation Years beginning after December 31,1995, any
gains attributable to such Elective Deferrals) will be distributed to the
Participant and the Employer matching contributions (and for Limitation Years
beginning after December 31, 1995, any gains attributable to such matching
contributions) will be used to reduce the Employer’s contributions in the next
Limitation Year;

 

(d)                                 If, after the
application of subparagraphs (a), (b), and (c), an “Excess Amount” still
exists, and the Participant is covered by the Plan at the end of the Limitation
Year, the “Excess Amount” in the Participant’s Account will be used to reduce
Employer contributions (including any allocation of Forfeitures) for such
Participant in the next Limitation Year, and each succeeding Limitation Year if
necessary;

 

(e)                                  If, after the
application of subparagraphs (a), (b) and (c) an (“Excess Amount”
still exists, and the Participant is not covered by the Plan at the end of a
Limitation Year, the “Excess Amount” will be held unallocated in a suspense
account. The suspense account will be applied to reduce future Employer
contributions (including allocation of any Forfeitures) for all remaining
Participants in the next Limitation Year, and each succeeding Limitation Year
if necessary; and

 

(f)                                    If a suspense
account is in existence at any time during a Limitation Year pursuant to this
Section, no investment gains and losses shall be allocated to such suspense
account. If a suspense account is in existence at any time during a particular
Limitation Year, all amounts in the suspense account must be allocated and
reallocated to Participants’ Accounts before any Employer contributions or any
Employee contributions may be made to the Plan for that Limitation Year. Except
as provided in (a), (b) and (c) above. “Excess Amounts” may not be
distributed to Participants or Former Participants,

 

44

 

4.6                               ROLLOVERS

 

(a)                                  If elected in the
Adoption Agreement and with the consent of the Administrator, the Plan may
accept a “rollover,” provided the “rollover” will not jeopardize the tax-exempt
status of the Plan or create adverse tax consequences for the Employer. The
amounts rolled over shall be set up in a Separate account herein termed to as a
“Participant’s Rollover.” Such account shall be fully Vested at all times and
shall not be subject to forfeiture for any reason. For purposes of this
Section, the term Participant shall include any Eligible Employee who is not
yet a Participant, if, pursuant to the Adoption Agreement “rollovers” are
permitted to be accepted from Eligible Employees.  In addition, for purposes of this Section the
term Participant shall also include former Employees if the Employer and
Administrator consent to accept “rollovers” of distributions made to former
Employees from any plan of the Employer.

 

(b)                                 Amounts in a
Participant’s Rollover Account shall he held by the Trustee pursuant to the
provisions of this Plan and may not be withdrawn by, or distributed to the
Participant, in whole or in part, except as elected in the Adoption Agreement
and subsection (c) below. The Trustee shall have no duty or responsibility
to inquire as to the propriety of the amount, value or type of assets
transferred, nor to conduct any due diligence with respect to such assets;
provided, however, that such assets are otherwise eligible to be held by the
Trustee under the terms of this Plan.

 

(c)                                  At Normal Retirement
Date, or such other date when the Participant or Eligible Employee or such
Participant’s or Eligible Employees Beneficiary shall be entitled to receive
benefits, the Participant’s Rollover Account shall be used to provide
additional benefits to the Participant or the Participants Beneficiary. Any
distribution of amounts held in as Participants Rollover Account shall be made
in a manner which is consistent with and satisfies the provisions of Sections
6.5 and 6.6, including, but not limited to, all notice and consent requirements
of Code Sections 411(a)(11) and 417 and the Regulations thereunder.  Furthermore, such amounts shall be considered
to be part of a Participant’s benefit in determining whether an involuntary
cash-out of benefits may be made without Participant consent.

 

(d)                                 The Administrator may
direct that rollovers made after a Valuation Date be segregated into a separate
account for each Participant until such time as the allocations pursuant to
this Plan have been made, at which time they may remain segregated, invested as
part of the general Trust Fund or, if elected in the Adoption Agreement
directed by the Participant.

 

(e)                                  For purposes of this
Section, the term “qualified plan” shall mean any tax qualified plan under Code
Section 401(a), or any other plans from which distributions are eligible
to be rolled over into this Plan pursuant to the Code. The term “rollover”
means: (i) amounts transferred to this Plan in a direct rollover made
pursuant to Code Section 401(a)(31) from another “qualified plan”: (ii) distributions
received by an Employee from other “qualified plans” which are eligible for
tax-free rollover to a “qualified plan” and which are transferred by the
Employee to this Plan within sixty  (60)
days following

 

45

 

receipt thereof; (iii) amounts transferred to this Plan from a
conduit individual retirement account provided that the conduit individual
retirement account has no assets other than assets which (A) were
previously distributed tine Employee by another “qualified plan” (B) were
eligible for tax-free rollover to a “qualified plan.” and (C) were
deposited in such conduit individual retirement account within sixty (60) days
of receipt thereof; (iv) amounts distributed to the Employee from a
conduit retirement account meeting the requirements of clause (iii) above
and transferred by the Employee to this Plan within sixty (60) days of receipt
thereof from such conduit individual retirement account; and (v) any other
amounts which are eligible to be rolled over to this Plan pursuant tan the
Code.

 

(f)                                    Prior to accepting
any “rollovers” to which this Section applies, the Administrator may
require the Employee to establish (by providing opinion of counsel or
otherwise) that the amounts to he rolled over to this Plan meet the
requirements of this Section.

 

4.7                               PLAN-TO-PLAN
TRANSFERS FROM QUALIFIED PLANS

 

(a)                                  With  the  consent  of  the  Administrator,  amounts  may  be  transferred  (within  the  meaning  of  Code  Section  414(1))  to  this  Plan  from  other  tax  qualified  plans  under  Code  Section  401  task  provided  the  plan  from  which  such  funds  are  transferred  permits  the  transfer  to  be  made  and  the  transfer  will  not  jeopardize  the  tax-exempt  status  of  the  Plan  or  Trust  or  create  adverse  tax  consequences  for  the  Employer.  Prior  to  accepting  any  transfers  to  which  this  Section  applies,  the  Administrator  may  require  an  opinion  of  counsel  that  the  amounts  to  be  transferred  meet  the  requirements  of  this  Section.  The  amounts  transferred  shall  be  set  up  in  a  separate  account  herein  referred  to  as  a  “Participant’s  Transfer  Account.”  Furthermore,  for  Vesting  purposes,  the  Participant’s  Transfer  Account  shall  be  treated  as  a  separate  “Participant’s  Account.”

 

(b)                                 Amounts in a
Participant’s Transfer Account shall be held by the Trustee pursuant to the
provisions of this Plan and may not be withdrawn by or distributed to the
Participant, in whole or in part, except as elected in the Adoption Agreement
and subsection (d) below, provided the restrictions of subsection (c) below
and Section 6.15 are satisfied. The Trustee shall have no duty or
responsibility to inquire as to the propriety of the amount, value or type of
assets transferred, nor to conduct any due diligence with respect to such
assets; provided, however, that such assets are otherwise eligible to be held
by the Trustee under the terns of this Plan.

 

(c)                                  Except as permitted
by Regulations (including Regulation 1.411(d)-4), amounts attributable to
elective contributions (as defined in Regulation 1.401(k)-1(g)(3)), including
amounts treated as elective contributions, which are transferred from another
qualified plan in as plan-to-plan transfer (other than a direct rollover) shall
be subject to the distribution limitations provided for in Regulation
1.401(k)-1(d).

 

46

 

(d)                                 At Normal Retirement
Date, or such other date when the Participant or the Participant’s Beneficiary
shall be entitled to receive benefits, the Participants Transfer Account shall
be used to provide additional benefits to the Participant or the Participant’s
Beneficiary.  Any distribution of amounts
held in a Participant’s Transfer Account shall be made in as which is
consistent with and satisfies the provisions of Sections 6.5 and 6.6,
including, but not limited to, all notice and consent requirements of Code
Sections 411(a)(11) and 417 and the Regulations thereunder.  Furthermore, such amounts shall be considered
to be part of a Participant’s benefit in determining whether an involuntary
cash-out benefits may be made without Participant consent.

 

(e)                                  The Administrator may
direct that Employee transfers made after a Valuation Date be segregated into a
separate account for each Participant until such time as the allocations
pursuant to this Plan have been made, at which time they may remain segregated,
invested as part of the general Trust Fund or, if elected in the Adoption
Agreement, directed by the Participant.

 

(f)                                    Notwithstanding
anything herein to the contrary, a transfer directly to this Plan from another
qualified plan for (or a transition having the effect of such a transfer) shall
only be permitted if it will not result in the elimination or reduction of any “Section 411(d)(6) protected
benefit” as described in Section 8.1(e).

 

4.8                          VOLUNTARY
EMPLOYEE CONTRIBUTIONS

 

(a)                                  Except as provided in
subsection 4.8(b) below, this Plan will not accept after-tax voluntary
Employee contributions.  If this is an
amendment to a Plan that had previously allowed after-tax voluntary Employee
contributions, then this Plan will not accept after-tax voluntary Employee
contributions for Plan Years beginning after the Plan Year in which this Plan
is adopted by the Employer.

 

(b)                                 For 401(k) Plans,
if elected in the Adoption Agreement, each Participant who is eligible to make
Elective Deferrals may, in accordance with nondiscriminatory procedures
established by the Administrator, elect to make after-tax voluntary Employee
contributions to this Plan. Such contributions must generally be paid to the
Trustee within a reasonable period of time after being received by the
Employer.

 

(c)                                  The balance in each
Participant’s Voluntary Contribution Account shall be fully Vested at all times
and shall not be subject to Forfeiture for any reason.

 

(d)                                 A Participant may
elect at any time to withdraw after-tax voluntary Employee contributions from
such Participant’s Voluntary Contribution Account and the actual earnings
thereon in a manner which is consistent with and satisfies the provisions of Section 6.5,
including, but not limited to, all notice and consent requirements of Code
Sections 411(a)(11) and 417 and the Regulations thereunder.  If the Administrator maintains subaccounts
with respect to after-tax voluntary Employee contributions (and earnings
thereon) which were made on or before a specified date, a Participant shall be
permitted to designate which sub-account shall be the source for the
withdrawal. Forfeitures of Employer contributions shall not occur solely as a
result of an Employee’s withdrawal of after-tax voluntary Employee
contributions.

 

47

 

In the event a Participant hits received a
hardship distribution pursuant to Regulation 1.401(k)-1(d)(2)(iii)(B) from any
plan maintained by the Employer, then the Participant shall be barred from
making any after-tax voluntary Employee contributions for a period of twelve
(12) months after receipt of the hardship distribution.

 

(e)                                  At Normal Retirement
Date, or such other date when the Participant or the Participant’s Beneficiary
is entitled to receive benefits, the Participant’s Voluntary
Contribution Account shall be used to provide additional benefits to the
Participant or the Participant’s Beneficiary.

 

(f)                                    To the extent a
Participant has previously made mandatory Employee contributions under prior
provisions of this Plan, such contributions will be treated as after-tax
voluntary Employee contributions.

 

4.9                               QUALIFIED
VOLUNTARY EMPLOYEE CONTRIBUTIONS

 

(a)                                  If this is an
amendment to a Plan that previously permitted deductible voluntary Employee
contributions, then each Participant who made “Qualified Voluntary Employee
Contributions” within the meaning of Code Section 219(e)(2) as it
existed prior to the enactment of the Tax Reform Act of 1986, shall have such
contributions held in a separate Qualified Voluntary Employee Contribution
Account which shall be fully Vested at all times. Such contributions, however,
shall not be permitted for taxable years beginning after December 31,1986.

 

(b)                                 A Participant may,
upon written request delivered to the Administrator, make withdrawals from such
Participant’s Qualified Voluntary Employee Contribution Account.  Any distribution shall be made in a manner
which is consistent with and satisfies the provisions of Section 6.5,
including, but not limited to, all notice and consent requirements of Code
Sections 411(a)(11) and 417 and the Regulations thereunder.

 

(c)                                  At Normal Retirement
Date, or such other date when the Participant or the Participant’s Beneficiary
is entitled to receive benefits, the Qualified Voluntary Employee Contribution
Account shall be used to provide additional benefits to the Participant or the
Participant’s Beneficiary.

 

4.10                  DIRECTED
INVESTMENT ACCOUNT

 

(a)                                  If elected in the
Adoption Agreement, all Participants may direct the Trustee as to the
investment of all or a portion of their individual account balances as set
forth in the Adoption Agreement and within limits set by the Employer,
Participants may direct the Trustee, in writing (or in such other form which is
acceptable to the Trustee), to invest their accounts in specific assets,
specific funds or other investments permitted

 

48

 

under the Plan and the Participant Direction Procedures. That portion
of the account of any Participant that is subject to investment direction of
such Participant will be considered a Participant Directed Account.

 

(b)                                 The Administrator will
establish a Direction Procedure, to be applied in a uniform and
nondiscriminatory manner, setting forth the permissible investment options
under this Section, how often changes between investments may be made and any
other limitations and provisions that the Administrator may impose on a
Participant’s right to direct investments.

 

(c)                                  The Administrator
may, in its discretion, include or exclude by amendment or other action from
the Participant Direction Procedure such instructions, guidelines or policies
as it deems necessary or appropriate to ensure proper administration of the
Plan, and may interpret the same accordingly.

 

(d)                                 As of each Valuation
Date, all Participant Directed Accounts shall be charged or credited with the
net earnings, gains, losses and expenses as well as any appreciation or
depreciation in the market value using publicly listed fair market values when
available or appropriate as follows:

 

(1)                                  to the extent the
assets in a Participant Directed Account are accounted for as pooled assets or
investments, the allocation of earnings, gains and losses of each Participant’s
Account shall be based upon the total amount of funds so invested in a manner
proportionate to the Participant’s share of such pooled investment; and

 

(2)                                  to the extent the
assets in a Participant Directed Account are accounted for as segregated
assets, the allocation of earnings, gains on and losses from such assets shall
be made on a separate and distinct basis.

 

(e)                                  Investment
directions will be processed as soon as administratively practicable after
proper investment directions are received from the Participant.  No guarantee is made by the Plan Employer,
Administrator or Trustee that investment directions will be processed on a
daily basis, and no guarantee is made in any respect regarding the processing
time of an investment direction. 
Notwithstanding any other provision of the Plan, the Employer,
Administrator or Trustee reserves the right to not value an investment option
on any given Valuation Date for any reason deemed appropriate by the Employer,
Administrator or Trustee.  Furthermore,
the processing of any investment transaction may be delayed for any legitimate
business reason (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).  The processing date of a
transaction will be binding for all purposes of the Plan and considered the
applicable Valuation Date for an investment transaction.

 

49

 

(f)                                    If  the Employer has elected in the Adoption
Agreement that it intends to operate any portion of this Plan as an Act Section 404(c) plan,
the Participant Direction Procedures should provide an explanation of the
circumstances under which Participants and their Beneficiaries may give
investment instructions, including but not limited to, the following:

 

(1)                                  the
conveyance of instructions by the Participants and their Beneficiaries to
invest Participant Directed Accounts in a Directed Investment Option:

 

(2)                                  the
name, address and phone number of the Fiduciary (and, if applicable, the person
or persons designated by the Fiduciary to act on its behalf) responsible for
providing information to the Participant or a Beneficiary upon request relating
to the Directed Investment Options:

 

(3)                                  applicable
restrictions on transfers to and from any Designated Investment Alternative:

 

(4)                                  any restrictions on
the exercise of voting tender and similar rights related to a Directed
Investment Option by. the Participants or their Beneficiaries:

 

(5)                                       a
description of any transaction fees and expenses which affect the balances in
Participant Directed Accounts in connection with the purchase or sale of a
Directed Investment Option: and

 

(6)                                       general
procedures for the dissemination of investment and other information relating
to the Designated Investment Alternatives as deemed necessary or appropriate,
including but not limited to a description of the following:

 

(i)                                   the
investment vehicles available under the Plan, including- specific information
regarding any Designated Investment Alternative:

 

(ii)                                any designated Investment
Managers; and

 

(iii)                             a
description of the additional information that may be obtained upon request
from the Fiduciary designated to provide such information.

 

(g)                                 With respect to those
assets in a Participants Directed Account, the Participant or Beneficiary shall
direct the Trustee with regard to any voting, tender and similar rights
associated with the ownership of such assets (hereinafter referred to as the “Stock
Rights”) as follows based on the election made in the Adoption Agreement:

 

(1)                                  each
Participant or Beneficiary shall direct the Trustee to vote or otherwise
exercise such Stock Rights in accordance with the provisions, conditions and
terms of any such Stock Rights:

 

50

 

(2)                                  such
directions shall be provided to the Trustee by the Participant or Beneficiary
in accordance with the procedure as established by the Administrator and the
Trustee shall vote or otherwise exercise such Stock Rights with respect to
which it has received directions to do so under this Section; and

 

(3)                                  to
the extent to which at Participant or Beneficiary does not instruct the Trustee
to vote or otherwise exercise such Stock Rights, such Participants or
Beneficiaries shall be deemed to have directed the Trustee that such Stock
Rights remain nonvoted and unexercised.

 

(h)                                 Any information
regarding investments available under the Plan, to the extent not required to
be described in the Participant Direction Procedures, may be provided to
Participants in one or more documents (or in any other form, including, but not
limited to, electronic media) which are separate from the Participant Direction
Procedures and are not thereby incorporated by reference into this Plan.

 

4.11                        INTEGRATION
IN MORE THAN ONE PLAN

 

If the Employer maintains qualified retirement plans that provide for
permitted disparity (integration), the provisions of Section 4.3(b)(4) will
apply.  Furthermore, if the Employer
maintains two or more standardized paired plans, only one plan may provide for
permitted disparity.

 

4.12                        QUALIFIED
MILITARY SERVICE

 

Notwithstanding any provisions of this Plan to the contrary, effective
as of the later of December l2, 1994, or the Effective Date of the Plan,
contributions, benefits and service credit with respect to qualified military
service will be provided in accordance With Code Section 414(u).  Furthermore, loan repayments may be suspended
under this Plan .as permitted under Code Section 414(u)(4).

 

ARTICLE V

VALUATIONS

 

5.1                               VALUATION
OF THE TRUST FUND

 

The Administrator shall direct the Trustee, as of each Valuation Date,
to determine the net worth of the assets comprising the Trust Fund as it exists
on the Valuation Date.  In determining
such net worth, the Trustee shall value the assets comprising the Trust Fund at
their fair market value (or their contractual value in the case of a Contract
or Policy) as of the Valuation Date and may deduct all expenses for which the
Trustee has not yet been paid by the Employer or the Trust Fund.  The Trustee may update the value of any
shares held in a Participant Directed Account by reference to the number of
shares held on behalf of the Participant, priced at the market value as of the
Valuation Date.

 

51

 

5.2                                           METHOD
OF VALUATION

 

In determining the fair market value of
securities held in the Trust Fund which are listed on a registered stock
exchange, the Administrator shall direct the Trustee to value the same at the
prices they were last traded on such exchange preceding the close of business
on the Valuation Date.  If such
securities were not traded on the Valuation Date, or if the exchange on which
they are traded was not open for business on the Valuation Date, then the
securities shall be valued at the prices at which they were last traded prior
to the Valuation Date. Any unlisted security held in the Trust Fund shall be
valued at its bid price next preceding the close of business on the Valuation
Date, which bid price shall be obtained from a registered broker or an
investment banker.  In determining the
fair market value of assets, other than securities for which trading or bid
prices can be obtained, the Trustee may appraise such assets itself, or in its
discretion, employ one or more appraisers for that purpose and rely on the
values established by such appraiser or appraisers.

 

ARTICLE VI

DETERMINATION AND DISTRIBUTION OF BENEFITS

 

6.1                               DETERMINATION
OF BENEFITS UPON RETIREMENT

 

Every
Participant may terminate employment with the Employer and retire for purposes
hereof on the Participant’s Normal Retirement Date or Early Retirement
Date.  However, a Participant may
postpone the termination of employment with the Employer to a later date, in
which event the participation of such Participant in the Plan, including the
right to receive allocations pursuant to Section 4.3, shall continue until such
Participant’s Retirement Date.  Upon a
Participants Retirement Date, or if elected in the Adoption Agreement, the
attainment of Normal Retirement Date without termination of employment with the
Employer, or as soon thereafter as practicable, the Administrators hall direct
the distribution at the election of the Participant of the Participants entire
Vested interest in the Plan in accordance with Section 6.5.

 

6.2                               DETERMINATION
OF BENEFITS UPON DEATH

 

(a)                                       Upon the death
of a Participant before the Participant’s Retirement date or other termination
of employment, all amounts credited to such Participant’s Combined Account
shall, if elected in the Adoption Agreement, become fully Vested. The
Administrator shall direct, in accordance with the provisions of Sections 6.6
and 6.7, the distribution of the deceased Participant’s Vested accounts to the
Participant’s Beneficiary.

 

(b)                                 Upon
the death of a Former Participant, the Administrator shall direct in accordance
with the provisions of Sections 6.6 and 6.7, the distribution of any remaining
Vested amounts credited to the accounts of such deceased Former Participant to
such Former Participant’s Beneficiary.

 

52

 

(c)                                  The
Administrator may require such proper proof of death and such evidence of the
right of any person to receive payment of the value of the account of a
deceased Participant or Former Participant as the Administrator may deem
desirable.  The Administrator’s
determination of death and of the right of any person to receive payment shall
be conclusive.

 

(d)                                 Unless
otherwise elected in the manner prescribed in Section 6.6, the Beneficiary of
the Pre-Retirement Survivor Annuity shall be the Participant’s surviving
spouse  Except, however, the Participant
may designate a Beneficiary other them the spouse for the Pre-Retirement
Survivor Annuity if:

 

(1)                                       the
Participant and the Participant’s spouse have validly waived the Pre-Retirement
Survivor Annuity in the manner prescribed in Section 6.6, and the spouse has
waived the right to he the Participant’s Beneficiary.

 

(2)                                  the
Participant is legally separated or has been abandoned (within the meaning of
local law) and the Participant has a court order to such effect (and there is
no “qualified domestic relations order” as defined in Code Section  414(p) which provides otherwise).

 

(3)                                  the
Participant has no spouse; or

 

(4)                                  the
spouse cannot be located.

 

In such event, the designation of a Beneficiary shall be made on a form
satisfactory to the Administrator.  A
Participant may at any time revoke a designation of a Beneficiary or change a
Beneficiary by filing written (or in such other form as permitted by the IRS)
notice of such revocation or change with the Administrator.  However, the Participant’s spouse must again
consent in writing (or in such other form as permitted by the IRS) to any
change in Beneficiary unless the original consent acknowledged that the spouse
had the right to limit consent only to a specific Beneficiary and that the
spouse voluntarily elected to relinquish such right.

 

(e)                                       A Participant
may, at any time, designate a Beneficiary for death benefits, if any, payable
under the Plan that are in excess of the Pre-Retirement Survivor Annuity
without the Waiver or consent of the Participant’s spouse.  In the event no valid designation of
Beneficiary exists, or if the Beneficiary is not alive at the time of the
Participant’s death, the death benefit will be paid in the following order of
priority, unless the Employer specifies a different order of priority in an
addendum to the adoption Agreement, to:

 

(1)                                  The
Participant’s surviving spouse:

 

(2)                                  The
Participants children, including adopted children, per stirpes

 

(3)                                  The
Participants surviving parents, in equal shares: or

 

53

 

(4)                                  The Participants
estate.

 

If  the  Beneficiary  does  not  predecease  the  Participant,  but  dies  prior  to  distribution  of  the  death  benefit,  the  death  benefit  will  be  paid  to  the  Beneficiary’s  estate.

 

(f)                                         Notwithstanding
anything in this Section to the contrary, if a Participant his designated the
spouse as a Beneficiary, then a divorce decree or a legal separation that
relates to such spouse shall revoke the Participant’s designation of the spouse
as a Beneficiary unless the decree or a qualified domestic relations order
(within the meaning of Code Section 414(p)) provides otherwise or a subsequent
Beneficiary designation is made.

 

(g)                                 If the Plan provides
an insured death benefit and a Participant dies before any insurance coverage
to which the Participant is entitled under the Plan is effected, the death
benefit from such insurance coverage shall be limited to the premium which was
or otherwise would .have been used for such purpose.

 

(h)                                 In
the event of any conflict between the terms of this Plan and the terms of any
Contract issued hereunder, the Plan provisions shall control.

 

6.3                               DETERMINATION
OF BENEFITS IN EVENT OF DISABILITY

 

In the event of
a Participant’s Total and Permanent Disability prior to the
Participant’s Retirement Date or other termination of employment, all amounts
credited to such Participant’s Combined Account shall, if elected in the
Adoption Agreement, become fully Vested. 
In the event of a Participant’s Total and Permanent Disability, the
Administrator, in accordance with the provisions of Sections 6.5 and 6.7 shall
direct the distribution to such Participant of the entire Vested interest in
the Plan.

 

6.4                               DETERMINATION
OF ENEFITS UPON TERMINATION

 

(a)                             If a Participant’s
employment with the Employer is terminated for any reason other than death,
Total and Permanent Disability, or retirement, then such Participant shall be
entitled to such benefits as are provided herein.

 

Distribution of the funds due to a Terminated
Participant shall be made on the occurrence of an event which would result in
the distribution had the Terminated  Participant remained in the
employ of the Employer (upon the Participant’s death Total and Permanent
Disability, Early or Normal Retirement). 
However, at the election of the Participant the Administrator shall
direct that the entire Vested portion of the Terminated Participant’s Combined
Account be payable Participant provided the conditions, if any, set forth in
the Adoption Agreement have been satisfied. Any distribution under this
paragraph shall be made in a manner which is consistent with and satisfies the
provisions of Section 6.5, including but not limited to, all notice and consent
requirements of Code Sections 411(a)(11) and 417 and the Regulations
thereunder.

 

54

 

Regardless of whether distributions in kind are permitted, in the event
the amount of the Vested portion of the Terminated Participant’s Combined
Account equals or exceeds the fair market value of any insurance Contracts, the
Trustee, when so directed by the administrator and agreed to by the Terminated
Participant shall assign, transfer, and set over to such Terminated Participant
all Contracts on such Terminated Participant’s life in such form or with such
endorsements, so that the settlement options and forms of payment ‘are
consistent with the provisions of Section 6.5. 
In the event that the Terminated Participant’s Vested portion does not
at least equal the fair market value of the Contracts, if any, the Terminated
Participant may pay over to the Trustee the sum needed to make the distribution
equal to the value of the Contracts being assigned transferred, or the Trustee,
pursuant to the Participant’s election, may borrow the cash value of the
Contracts from the Insurer so that the value of the Contracts is equal to the
Vested portion of the Terminated Participant’s Combined Account and then assign
the Contracts to the Terminated Participant.

 

Notwithstanding the above, unless otherwise elected in the Adoption
Agreement, if the value of a Terminated Participant’s Vested benefit derived
from Employer and Employee contributions does not exceed $5,000 (or $3,500 for
distributions made prior to the later of the first day of the first Plan Year
beginning on or after August 5, 1997, or the date specified in the Adoption
Agreement) the Administrator shall direct that the entire Vested benefit be
paid to such Participant in a single lump-sum without regard to the consent of
the Participant or the Participant’s spouse. 
A Participant’s Vested benefit shall not include Qualified Voluntary
Employee Contributions within the meaning of Code Section 72(o)(5)(B) for Plan
Years beginning prior to January 1, 1989. 
Furthermore, the determination of whether the $5,000 (or, if applicable,
$3,500) threshold has been exceeded is generally based on the value of the
Vested benefit as of the Valuation Date preceding the date of the distribution.
However, if the “lookback rule” applies, the applicable threshold is deemed to
be exceeded if the Vested benefit exceeded the applicable threshold at the time
of any prior distribution. The “lookback rule” generally applies to all
distributions made prior to March 22, 1999. With respect to distributions made
on or after March 22, 1999, the “lookback rule” applies if either (1) the
provisions of Section 6.12 do not apply or (2) a Participant has begun to
receive distributions pursuant to an optional form of benefit under which at
least one scheduled periodic distribution has not yet been made, and if the
value of the Participant’s benefit, determined at the time of the first
distribution under that optional form of benefit exceeded the applicable
threshold.  However, the Plan does not
fail to satisfy the requirements of this paragraph if, prior to the adoption of
this Prototype Plan, the “lookback rule” was applied to all distributions.  Notwithstanding the preceding, the “lookback”
will not apply to any distributions made on or after October 17, 2000.

 

(b)                                 The Vested portion of
any Participant’s Account shall be a percentage of such Participant’s Account
determined on the basis of the Participants number of Years of Service for
Periods of Service if the Elapsed Time Method is elected) according to the
vesting schedule specified in the Adoption Agreement.  However, a Participant’s entire interest in
the Plan shall be non-forfeitable upon the Participant’s Normal Retirement Age
(if the Participant is employed by the Employer on or after such date).

 

55

 

(c)                                  For
any Top Heavy Plan Year, the minimum top heavy vesting schedule elected by the
Employer in the Adoption Agreement will automatically apply to the Plan. The
minimum top heavy vesting schedule applies to all benefits within the meaning
of Code Section 411(a)(7) except those attributable to Employee contributions,
including benefits accrued before the effective date of Code Section 416 and
benefits accrued before the Plan became top heavy.  Further, no decrease in a Participant’s
Vested percentage shall occur in the event the Plan’s status as top heavy
changes for any Plan Year.  However, this
Section does not apply to the account balances of any Employee who does not
have an Hour of Service after the Plan has initially become top heavy and the
Vested percentage of such Employee’s Participant’s Account shall be determined
without regard to this Section 6.4(c).

 

If in any subsequent Plan Year the Plan ceases to be a Top Heavy Plan,
then unless a specific Plan  amendment
is made to provide otherwise, the Administrator will continue to use the
vesting schedule in effect while the Plan was a Top Heavy Plan.

 

(d)                            Upon the complete
discontinuance of the Employer’s contributions to the Plan (if this is a profit
sharing plan) or upon any full or partial termination of the Plan, all amounts
then credited to the account of any affected Participant shall become 100%
Vested and shall not thereafter be subject to Forfeiture.

 

(e)                             If
this is an amended or restated Plan, then notwithstanding the vesting schedule
specified in the Adoption Agreement, the Vested percentage of Participant’s
Account shall not be less than the Vested percentage attained as of the later
of the effective date or adoption date of this amendment and restatement. The
computation of a Participant’s nonforfeitable percentage of such Participants
interest in the Plan shall not be reduced as the result of any direct or
indirect amendment to this Article, or due to changes in the Plan’s status as a
Top Heavy Plan.  Furthermore, if the
Plan’s vesting schedule is amended, then the amended schedule will only apply
to those Participants who complete an Hour of Service after the effective date
of the amendment.

 

(f)                               If the Plan’s vesting schedule
is amended, or if the Plan is amended in any way that directly or indirectly
affects the computation of the Participant’s nonforfeitable percentage or if
the Plan is deemed amended by an automatic change to a top heavy vesting
schedule, then each Participant with at least three (3) Years of Service (or
Periods of Service if the Elapsed Time Method is elected) as of the expiration
date of the election period may elect to have such Participant’s nonforfeitable
percentage computed under the Plan without regard to such amendment or change.
If a Participant fails to make such election, then such Participant shall be
subject to the new vesting schedule.   The Participant’s election period shall
commence on the adoption date of the amendment and shall end sixty (60) days
after the latest of:

 

(1)                                  the adoption date of
the amendment.

 

(2)                                  the effective date of
the amendment, or

 

56

 

(3)                                         the
date the Participant receives written notice the amendment from the Employer or
Administrator.

 

(g)                                        In determining
Years of Service or Periods of Service for purposes of vesting under the Plan,
Years of Service or Periods of Service shall be excluded as elected the
Adoption Agreement.

 

6.5                               DISTRIBUTION
OF BENEFITS

 

(a)(1)                           Unless otherwise elected as
provided below, a Participant who married on the Annuity Starting Date and who
does not die before the Annuity Starting Date shall receive the value of all
Plan benefits in the form of a Joint and Survivor Annuity. The Joint and Survivor
Annuity is an annuity that commences immediately and shall be equal in value to
a single life annuity. Such joint and survivor benefits following the
Participants death shall continue to the spouse during the spouse’s lifetime at
a rate equal to either fifty percent (50%), seventy-five percent (75%) (or,
sixty-six and two-thirds percent (66 2/3%) if the Insurer used to provide the
annuity does not offer a joint and seventy-five percent (75% annuity ), or one
hundred percent (100%) of the rate at which such benefits were payable to the
Participant. Unless otherwise elected in the Adoption Agreement, a joint and
fifty percent (50%) survivor annuity shall be considered the designated
qualified joint and Survivor Annuity and the normal form of payment for the
purposes of this plan.  However, the
Participant may, without spousal consent, elect an alternative Joint and
Survivor Annuity, which alternative shall be equal in value to the designated
qualified joint and Survivor Annuity. An unmarried Participant shall receive
the value of such Participant’s benefit in the form of a life annuity.  Such unmarried Participant, however, may
elect to waive the life annuity.  The
election must comply with the provisions of this Section as if it were an
election to waive the Joint and Survivor Annuity by a married Participant, but
without fulfilling the spousal consent requirement.  The Participant may elect to have any annuity
provided for in this Section distributed upon the attainment of the “earliest
retirement age” under the Plan.  The
“earliest retirement age” is the earliest date on which, under the Plan, the
Participant could elect to receive retirement benefits.

 

(2)                                              An
election to waive the Joint and Survivor must be made by the Participant in
writing (or in such other form as permitted by the IRS) during the election
period and be consented to in writing (or in such other form as permitted by
the IRS) by the Participant’s spouse.  If
the spouse is legally incompetent to give consent, the spouse’s legal guardian,
even if such guardian is the Participant, may give consent.  Such election shall designate a Beneficiary
(or a form of benefits) that may not be changed without spousal consent (unless
the consent of the spouse expressly permits designations by the Participant
without the requirement of further consent by the spouse).  Such spouse’s consent shall be irrevocable
and must acknowledge the effect of such election and be witnessed by a Plan
representative or a notary public. Such consent shall not be required if it is
established to the satisfaction of the Administrator that the required 

 

57

 

consent cannot be obtained because there is
no spouse, the spouse cannot be located, or other circumstances that may be
prescribed by Regulations.  The election
made by the Participant and consented to by such Participant’s spouse may be
revoked by the Participant in writing (or in such other form as permitted by
the IRS) without the consent of the spouse at any time during the election
period.  A revocation of a prior election
shall cause the Participant’s benefits to be distributed as a Joint and
Survivor Annuity.  The number of
revocations shall not be limited. Any new election must comply with  the requirements of this paragraph. A
former spouse’s waiver shall not be binding on a new spouse.

 

(3)                                  The
election period to waive the Joint and Survivor Annuity shall be the ninety
(90) day period ending on the Annuity Starting  Date.

 

(4)                                  For
purposes of this Section, spouse or surviving spouse means the spouse or
surviving spouse of the Participant, provided that a former spouse will be
treated as the spouse or surviving spouse and a current spouse will not be
treated as the spouse or surviving spouse to the extent provided under a qualified
domestic relations order as described in Code Section 414(p).

 

(5)                                  With
regard to the election, except as otherwise provided herein, the Administrator
shall provide to the Participant no less than thirty (30) days and no more than
ninety (90) days before the Annuity Starting Date a written (or such other form
as permitted by the IRS) explanation of:

 

(i)                                       the
terms and conditions of the Joint and Survivor Annuity.

 

(ii)                                    the
Participant’s right  to make and
the effect of an election to waive the Joint and Survivor Annuity.

 

(iii)                                 the
right of the Participant’s spouse to consent to any election to  waive
the Joint and Survivor Annuity, and

 

(iv)                                the
right of the Participant to revoke such election, and the effect of such
revocation.

 

(6)                                  Any
distribution provided for in this Section made on or after December 31, 1996,
may commence less than thirty (30) days after the notice required by Code
Section 417(a)(3) is given provided the following requirements are satisfied:

 

(i)                                       the
Administrator clearly informs the Participant that the Participant has a right
to a period of thirty (30) days after receiving the notice to consider whether
to waive the Joint and Survivor Annuity and to elect (with spousal consent) a
form of distribution other than a Joint and Survivor Annuity;

 

58

 

(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 seven (7) day period that begins the day after the
explanation of the Joint and Survivor Annuity is provided to the Participant;

 

(iii)                                 the
Annuity Starting Date is after the time that the explanation of the Joint and
Survivor Annuity is provided to the Participant.  However, the Annuity Starting Date may be
before the date that any affirmative distribution election is made by the
Participant and before the date that the distribution is permitted to commence
under (iv) below; and

 

(iv)                                distribution
in accordance with the affirmative election does not commence before the
expiration of the seven (7) day period that begins the day after the
explanation of the Joint and Survivor Annuity is provided to the Participant.

 

(b)                                 In
the event a married Participant duly elects pursuant to paragraph (a)(2) above
not to receive the benefit in the form of a Joint and Survivor Annuity, or if
such Participant is not married, in the form of a life annuity, the
Administrator, pursuant to the election of the Participant, shall direct the distribution
to a Participant or Beneficiary any amount to which the Participant or
Beneficiary is entitled under the Plan in one or more of the following methods
which are permitted pursuant to the Adoption Agreement:

 

(1)                                  One
lump-sum payment in cash or in property that is allocated to the accounts of
the Participant at the time of the distribution;

 

(2)                                  Partial
withdrawals;

 

(3)                                  Payments
over a period certain in monthly, quarterly, semiannual, or annual cash
installments.  In order to provide such
installment payments, the Administrator may (A) segregate the aggregate amount
thereof in a separate, federally insured savings account, certificate of
deposit in a bank or savings and loan association, money market certificate or
other liquid short-term security or (B) purchase a nontransferable annuity
contract for a term certain (with no life contingencies) providing for such
payment. The period over which such payment is to be made shall not extend
beyond the Participant’s life expectancy (or the life expectancy of the
Participant and the Participant’s designated Beneficiary);

 

(4)                                       Purchase
of or providing an annuity.   However, such annuity may not be in any form
that will provide for payments over a period extending beyond either the life
of the Participant for the lives of the Participant and the Participant’s
designated Beneficiary) or the life expectancy of the Participant (or the life
expectancy of the Participant and the Participant’s designated Beneficiary).

 

59

 

(c)                                       Benefits may not
be paid without the Participant’s and the Participant’s spouse’s
consent if the present value of the Participant’s Joint and Survivor Annuity
derived from Employer and Employee contributions exceeds, or has ever exceeded,
$5,000 (or $3,500, for distributions made prior to the later of the first day
of the first Plan Year beginning after August 5, 1997, or the date specified in
the Adoption Agreement ) and the benefit is “immediately distributable.”  However, spousal consent is not required if
the distribution will made in the form of a Qualified Joint and Survivor
Annuity and the benefit is “immediately distributable.”  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 later of the Participant’s Normal Retirement Age or age 62.

 

If the value of the Participant’s benefit
derived from Employer and Employee contributions does not exceed, and has never
exceeded at the time any prior distribution, $5,000 (or, if applicable,
$3,300), then the Administrator will distribute such benefit in a lump-sum
without such Participant’s consent.  No
distribution may  be made under
the preceding sentence after the Annuity Starting Date unless the Participant
and the Participant’s spouse consent in writing (or in such other form as
permitted by the IRS) to such distribution. 
Any consent required under this paragraph must be obtained not more than
ninety (90) days before commencement of the distribution and shall be made in a
manner consistent with Section 6.5(a)(2). 
Notwithstanding the preceding, the “lookback rule” (which provides that
if the present value at the time of a prior distribution exceeded the
applicable dollar threshold, then the present value at any subsequent time is
deemed to exceed the threshold)  will
not apply to any distributions made on or after October 17, 2000.

 

(d)                                    The
following rules will apply with respect to the consent requirements set forth
in subsection (c):

 

(1)                                     No
consent shall be valid unless the Participant has received a general
description of the material features and an explanation of the relative values
of the optional forms of benefit available under the Plan that would satisfy
the notice requirements of Code Section 417;

 

(2)                                     The
Participant must be informed of the right to defer receipt of the distribution.
If a Participant fails to consent, it shall be deemed an election to defer the
commencement of payment of any benefit. 
However, any election to defer the receipt of benefits shall not apply
with respect to distributions that are required under Section 6.5(e);

 

(3)                                     Notice
of the rights specified under this paragraph shall be provided no less than
thirty (30) days and no more than ninety (90) days before the Annuity Starting
Date;

 

(4)                                     Written
(or such other form as permitted by the IRS) consent of the Participant to the
distribution must not be made before the Participant receives the notice and
must not be made more than ninety (90) days before the Annuity Starting Date;
and

 

60

 

(5)                                     No
consent shall be valid if a significant detriment is imposed under the Plan on
any Participant who does not consent to the distribution.

 

(e)                                    Notwithstanding any
provision in the Plan to the contrary, for Plan Years beginning after December
31, 1990, the distribution of a Participant’s benefits, whether under the Plan
or through the purchase of an annuity Contract, shall be made in accordance
with the following requirements and shall otherwise comply with Code Section
401(a)(9) and the Regulations thereunder (including Regulation 1.401(a)(9)-2):

 

(1)                                     A
Participant’s benefits will be distributed or must begin to be distributed not
later than the Participant’s “required beginning date.” Alternatively,
distributions to the Participant must begin no later than the Participant’s
“required beginning date” and must be made over the life of the Participant (or
the lives of the Participant and the Participant’s designated Beneficiary) or
the life expectancy of the Participant (or the life expectancies of the
Participant and the Participant’s designated Beneficiary) in accordance with
Regulations.  However, if the
distribution is to be in the form of a joint and survivor annuity or single
life annuity, then distributions must begin no later than the “required
beginning date” and must be made over the life of the Participant (or the lives
of the Participant and the Participant’s designated Beneficiary) in accordance
with Regulations.

 

(2)                                     The
“required beginning date” (or a Participant who is a “five percent (5%) owner”
with respect to the Plan Year ending in the calendar year in which such
Participant attains age 70 1/2 means April 1st of the calendar year following
the calendar year in which the Participant attains age 70 1/2. Once
distributions have begun to a “five percent (5%) owner” under this subsection,
they must continue to be distributed, even if the Participant ceases to be a
“five percent (5%) owner” in a subsequent year.

 

(3)                                     The
“required beginning date” for a Participant other than a “five percent (5%)
owner” means, unless the Employer has elected to continue the pre-SBJA rules in
the Adoption Agreement, April 1st of the calendar year following the later of
the calendar year in which the Participant attains age 70 1/2 or the
calendar year in which the Participant retires.

 

(4)                                     If
the election is made to continue the pre-SBJA rules, then except as provided
below, the “required beginning date” is April 1st of the calendar year
following the calendar year in which a Participant attains age 70 1/2.

 

61

 

(i)                                     However,
the “required beginning date” for a Participant who had attained age 70 1⁄2
before January 1, 1988, and was not a five percent (5%) owner (within the
meaning of Code Section 416) at any time during the Plan Year ending with or
within the calendar year in which the Participant attained age 66 1/2 or any
subsequent Plan Year, is April 1st of the calendar year following the calendar
in which the Participant retires.

 

(ii)                                       Notwithstanding
(i) above, the “required beginning date” for a Participant who was a five
percent (5%) owner (within the meaning of Code Section 416) at any time during
the five (5) Plan Year period ending in the  calendar
year in which the Participant attained age 70 1/2 is April 1st of the calendar
year in which the Participant attained age 70 1/2.  In the case of a Participant who became a
five percent (5%) owner  during
any Plan Year after the calendar year in which the Participant attained Age 70
1/, the “required beginning date” is April 1st of the calendar year following
the calendar year in which such subsequent Plan Year ends.

 

(5)                                  If
this is an amendment or restatement of a plan that contained the pre-SBJPA
rules and an election is made to use the post-SBJPA rules, then the transition
rules elected in the Adoption Agreement will apply.

 

(6)                                  Except
as otherwise provided herein, “five percent (5%) owner” means, for purposes of
this Section, a Participant who is a five percent (5%) 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.

 

(7)                                  Distributions
to a Participant and such Participant’s Beneficiaries will only be made in
accordance with the incidental death benefit requirements of Code Section
401(a)(9)(G) and the Regulations thereunder.

 

(8)                                For
purposes of this Section, the life expectancy of a Participant and/or a
Participant’s spouse (other than in the case of a life annuity) shall or shall
not be redetermined annually as elected in the Adoption Agreement and in
accordance with Regulations.  If the
Participant or the Participant’s spouse may elect,  pursuant to the Adoption Agreement, to have
life expectancies recalculated, then the election, once made shall be
irrevocable.  If no election is made by
the time distributions must commence, then the life expectancy of the
Participant and the Participant’s spouse shall not be subject to recalculation.
Life expectancy and joint and last survivor life expectancy shall be computed
using the return multiples in Tables V and VI of Regulation Section 1.72-9.

 

(9)                                  With
respect to distributions under the Plan made for calendar years beginning on or
after January 1, 2001, or if later, the date specified in the Adoption
Agreement, the Plan will apply the minimum distribution requirements of Code
Section 401(a)(9) in accordance with the Regulations under Section 

 

62

 

401(a)(9) that
were proposed on January 17, 2001, notwithstanding any provision of the Plan to
the contrary.  This amendment shall
continue in effect until the end of the last calendar year beginning before the
effective date of final Regulations under Section 401(a)(9) or such other date
as may be specified in guidance published by the Internal Revenue Service.

 

However, if the date specified in the Adoption Agreement is a date in
2001 other than January 1, 2001, then with respect to distributions under the
Plan made on or after such date for calendar years beginning on or after
January 1, 2001, the Plan will apply the minimum distribution requirements of
Code Section 401(a)(9) in accordance with the Regulations under Section 401(a)(9)
that were proposed on January 17, 2001, notwithstanding any provision of the
Plan to the contrary.  If the total
amount of required minimum distributions made to a participant for 2001  prior to the specified date are equal to or
greater than the amount of required minimum distributions determined under the
2001 Proposed Regulations, then no additional distributions are required for
such participant for 2001 on or after such date.  If the total amount of required minimum
distributions made to a participant for 2001 prior to the specified date are
less than the amount determined under the 2001 Proposed Regulations, then the
amount of required minimum distributions for 2001 on or after such date will be
determined so that the total amount of required minimum distributions for 2001
is the amount determined under the 2001 Proposed Regulations.  This amendment shall continue in effect until
the end of the last calendar year beginning before the effective date of final
Regulations under Section 401(a)(9) or such other date as may be specified in
guidance published by the Internal Revenue Service.

 

(f)                                    All annuity
Contracts under this Plan shall be non-transferable when distributed.  Furthermore, the terms of any annuity
Contract purchased and distributed to a Participant or spouse shall comply with
all of the requirements of this Plan.

(g)                                 Subject
to the spouse’s right of consent afforded under the Plan, the restrictions
imposed by this Section shall not apply if a Participant has, prior to January
1, 1984, made a written designation to have retirement benefits paid an
alternative method acceptable under Code Section 401(a) as in effect prior to
the enactment of the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA).

 

(h)                                 If
a distribution is made to a Participant who has not severed employment and who
is not full Vested in the Participant’s Account, and the Participant may,
increase the Vested percentage in such account, then at any relevant time the
Participants Vested portion of the account will be equal to an amount (“X”)
determined by the formula:

 

X equals P (AB plus D) - D

 

For purposes of applying the formula; P is the Vested percentage at the
relevant time. AB is the account balance at the relevant time.  D is the amount of distribution, and the
relevant time is the time at which, under the Plan, the Vested percentage in
the account cannot increase.

 

63

 

However, the Employer may attach an addendum
to the Adoption Agreement to provide that as separate account shall be
established for the Participants, interest in the Plan as of the time of the
distribution, and at any relevant time the Participants Vested portion of the
separate account will be equal to an amount determined as follows:  P(AB plus (R x D)) — (R x D) where R is the  ratio of the account balance at the
relevant time to the account balance after distribution and the other terms
have the same meaning as in the preceding paragraph. Any amendment to change
the formula in accordance with the preceding sentence shall not be considered
an amendment which causes this Plan to become an individually designed Plans.

 

(i)                                     If
this is a Plan amendment that eliminates or restricts the ability of a
Participant to receive payment of the Participant’s interest in the Plan under
as particular optional form of benefit, then the amendment shall not apply to
any distribution with an annuity starting date earlier than the earlier of: (i)
the 90th day after the date the Participant receiving the distribution has been
furnished a summary that reflects the amendment and that satisfies the Act
requirements at 29 CFR 2520.104b-3 relating to a summary of material
modifications or (ii) the first day of the second Plan Year following the Plan
Year in which the amendment is adopted.

 

6.6                                 DISTRIBUTION
OF BENEFITS UPON DEATH

 

(a)                                  Unless
otherwise elected as provided below, a Vested Participant who dies before the
Annuity Starting Date and who has surviving spouse shall have the
Pre-Retirement Survivor Annuity paid to the surviving spouse. The Participant’s
spouse may direct that payment of the Pre-Retirement Survivor Annuity commence
within a reasonable period after the Participant’s death. If the spouse does
not so direct, payment of such benefit will commence at the time the Participant
would have attained the later of Normal Retirement Age or age 62. However, the
spouse may elect a later commencement date. Any distribution to the
Participant’s spouse shall be subject to the rules specified in Section 6.6(h).

 

(b)                                 Any
election to waive the Pre-Retirement Survivor Annuity before the Participant’s
death must be made by the Participant in writing (or in such other form as
permitted by the IRS) during the election period and shall require the spouse’s
irrevocable consent in the same manner provided for in Section 6.5(a)(2).
Further, the spouse’s consent must acknowledge the specific nonspouse
Beneficiary.  Notwithstanding the
foregoing, the nonspouse Beneficiary need not be acknowledged, provided the
consent of the spouse acknowledges that the spouse has the right to limit
consent only to a specific Beneficiary and that the spouse voluntarily elects
to relinquish such right.

 

(c)                                  The
election period to waive the Pre-Retirement Survivor Annuity shall begin on the
first day of the Plan Year in which the Participant attains age 35 and end on
the date of the Participants death. An earlier waiver (with spousal consent)

 

64

 

may be made
provided a written (or such other form as permitted by the IRS) explanation of
the Pre-Retirement Survivor Annuity is given to the Participant and such waiver
becomes invalid at the beginning of the Plan Year in which the Participant
turns age 35.  In the event a Participant
separates from service prior to the beginning of the election period, the
election period shall begin on the date of such separation from service.

 

(d)                                 With
regard to the election, the Administrator shall provide each Participant within
the applicable election period, with respect to stash Participant (and
consistent with Regulations), a written for such other form as permitted by the
IRS) explanation of the Pre-Retirement Survivor Annuity containing comparable
information to that required pursuant to Section 6.5(a)(5). For the purposes of
this paragraph, the term “applicable period” means, with respect to a
Participant, whichever of the following periods ends last:

 

(1)                                  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:

 

(2)                                  A
reasonable period after the individual becomes a Participant

 

(3)                                  A
reasonable period ending after the Plan no longer fully subsidizes the cost of
the Pre-Retirement Survivor Annuity with respect to the Participant;  or

 

(4)                                  A
reasonable period ending after Code Section 401(a)(11) applies to the
Participant.

 

For purposes of applying this subsection, a reasonable period ending
after the enumerated events described in (2), (3) and (4) is the end of the two
(2) year period beginning one (1) year prior to the date the applicable event
occurs, and ending one (1) year after that date.  In the case of a Participant who separates
from service before the Plan Year in which age 35 is attained, notice shall be
provided within the two (2) year period beginning one (1) year prior to
separation and ending one (1) year after separation.  If such a Participant thereafter returns to
employment with the Employer, the applicable period for such Participant shall
be redetermined.

 

(e)                                  The
Pre-Retirement Survivor Annuity provided for in this Section shall apply only
to Participants who are credited with an Hour of Service on or after August 23,
1984. Former Participants who are not credited with an Hour of Service on or
after August 23, 1984, shall be provided with rights to the Pre-Retirement
Survivor Annuity in accordance with Section 303(e)(2) of the Retirement Equity
Act of 1984.

 

(f)                                    If
the value of the Pre-Retirement Survivor Annuity derived from Employer and
Employee contributions does not exceed, and has never exceeded at the time of
any prior distribution, $5,000 (or, $3,500 for distributions made prior to the
later of the first day of the first Plan Year beginning after August 5, 1997,
or the date

 

65

 

specified in
the Adoption Agreement) the Administrator shall direct the distribution of such
amount to the Participant’s spouse as soon as practicable.  No distribution may be made under the preceding
sentence after the Annuity Starting Date unless the spouse consents in writing
(or in such other form as permitted by the IRS).  If the value exceeds, or has ever exceeded at
the time of any prior distribution, $5,000 (or, if applicable, $3,500), an immediate
distribution of the entire amount may be made to the surviving spouse, provided
such surviving spouse consents in writing (or in such other form as permitted
by the IRS) to such distribution.  Any
consent required under this paragraph must be obtained not more than ninety
(90) days before commencement of the distribution and shall be made in a manner
consistent with Section 6.5(a)(2). Notwithstanding the preceding, the “lookback
rule” (which provides that if the present value at the time of a prior distribution
exceeded the applicable dollar threshold, then the present value at any
subsequent time is deemed to exceed the threshold) will not apply to any
distributions made on or after October 17, 2000.

 

(g)                                 Death
benefits may be paid to a Participant’s Beneficiary in one of the following
optional forms of benefits subject to the rules specified in Section 6.6(h) and
the elections made in the Adoption Agreement. 
Such optional forms of distributions may be elected by the Participant
in the event there is an election to waive the Pre-Retirement Survivor Annuity,
and for any death benefits in excess of the Pre-Retirement Survivor
Annuity.  However, if no optional form of
distribution was elected by the Participant prior to death, then the
Participant’s Beneficiary may elect the form of distribution:

 

(1)                                  One
lump-sum payment in cash or in property that is allocated to the accounts of
the Participant at the time of the distribution.

 

(2)                                  Partial
withdrawals.

 

(3)                                  Payment
in monthly, quarterly, semi-annual, or annual cash installments over a period
to be determined by the Participant or the Participant’s Beneficiary. In order
to provide such installment payments, the Administrator may (A) segregate the
aggregate amount thereof in a separate, federally insured savings account,
certificate of deposit in a bank or savings and loan association, money market
certificate or other liquid short-term security or (B) purchase a
nontransferable annuity contract for a term certain (with no life
contingencies) providing for such payment. 
After periodic installments commence, the Beneficiary shall have the
right to reduce the period over which such periodic installments shall be made,
and the cash amount of such periodic installments shall be adjusted
accordingly.

 

(4)                                  In
the form of an annuity over the life expectancy of the Beneficiary.

 

(5)                                  If
death benefits in excess of the Pre-Retirement Survivor Annuity are to be paid
to the surviving spouse, such benefits may be paid pursuant to (1), (2) or (3)
above, or used to purchase an annuity so as to increase the payments made
pursuant to the Pre-Retirement Survivor Annuity.

 

66

 

(h)           Notwithstanding  any  provision  in  the  Plan  to  the  contrary,  distributions  upon  the  death  of  a  Participant  shall  be  made  in  accordance  with  the  following  requirements  and  shall  otherwise  comply  with  Code  Section  401(a)(9)  and  the  Regulations  thereunder.

 

(1)           If it is determined,
pursuant to Regulations, that the distribution of a Participant’s interest has
begun and the Participant dies before the entire interest has been distributed,
the remaining portion of such interest shall be distributed at least as rapidly
as under the method of distribution elected pursuant to Section 6.5 as of the
date of death.

 

(2)           If a Participant
dies before receiving any distributions of the interest in the Plan or before
distributions are deemed to have begun pursuant to Regulations, then the death
benefit shall be distributed to the Participant’s Beneficiaries in accordance
with the following rules subject to the elections made in the Adoption
Agreement and subsections 6.6(b)(3) and 6.6(i) below:

 

(i)              The entire death
benefit shall be distributed to the Participant’s Beneficiaries by December
31st of the calendar year in which the fifth anniversary of the Participant’s
death occurs:

 

(ii)             The 5-year
distribution requirement of (i) above shall not apply to any portion of the deceased
Participant’s interest which is payable to or for the benefit of a designated
Beneficiary.  In such event, such portion
shall be distributed over the life of such designated Beneficiary (or over a
period not extending beyond the life expectancy of such designated Beneficiary)
provided such distribution begins not later than December 31st of the calendar
year immediately following the calendar year in which the Participant died or
such later date as may be prescribed by Regulations):

 

(iii)            However, in the
event the Participant’s spouse (determined as of the date of the Participants
death is the designated Beneficiary, the provisions of (ii) above shall apply
except that the requirement that distributions commence within one year of the
Participant’s death shall not apply.  In
lieu thereof, distributions must commence on or before the later of:  (1) December 31st of the calendar year
immediately following the calendar year in which the Participant died; or (2)
December 31st of the calendar year in which the Participant would have attained
age 70 1/2.  If the surviving spouse dies
before distributions to such spouse begin, then the 5-year distribution
requirement of this Section shall apply as if the spouse was the Participant.

 

(3)           Notwithstanding subparagraph
(2) above, or any elections made in the Adoption Agreement, if a Participant’s
death benefits are to be paid in the form of a Pre-Retirement Survivor Annuity,
then distributions to the Participant’s surviving spouse must commence on or
before the later of:  (1) December 31st
of 

 

67

 

the calendar year immediately following the calendar year in which the
Participant died or (2) December 31st of the calendar year in which the
Participant would have attained age 70 1/2.

 

(i)            For
purposes of Section 6.6(h)(2), the election by a designated Beneficiary to be
excepted from the 5-year distribution requirement (if permitted in the Adoption
Agreement) must be made no later than December 31st of the calendar year
following the calendar year of the Participant’s death. Except, however, with
respect to a designated Beneficiary who is the Participant’s surviving spouse,
the election must be made by the earlier of: (1) December 31st of the calendar
year immediately following the calendar year in which the Participant died or,
if later, December 31st of the calendar year in which the Participant would
have attained age 70 1/2; or (2) December 31st of the calendar year which
contains the fifth anniversary of the date of the Participant’s death.  An election by as designated Beneficiary must
be in writing (or in such other form as permitted by the IRS) and shall be
irrevocable as of the last day of the election period stated herein.  In the absence of an election by the
Participant or a designated Beneficiary, the 5-year distribution requirement
shall apply.

 

(j)              For purposes of
this Section, the life expectancy of a Participant and a Participants spouse
(other than in the case of a life annuity) shall or shall not be redetermined
annually as elected in the adoption Agreement and in accordance with
Regulations.  If the Participant may
elect, pursuant to the Adoption Agreement, to have life expectancies
recalculated, then the election, once made shall be irrevocable. If no election
is made by the time distributions must commence, then the life expectancy of
the Participant and the Participant’s spouse shall not be subject to
recalculation.  Life expectancy and joint
and last survivor life expectancy shall be computed using the return multiples
in Tables V and VI of Regulation Section 1.72-9.

 

(k)             For
purposes of this Section, any amount paid to a child of the Participant will be
treated as if it had been paid to the surviving spouse if the amount becomes
payable to the surviving spouse when the child reaches the age of majority.

 

(l)              In
the event that less than one hundred percent (100%) of a Participant’s interest
in the Plan is distributed to such Participants spouse, the portion of the
distribution attributable to the Participant’s Voluntary Contribution Account
shall be in the same proportion that the Participants Voluntary Contribution
Account bears to the Participants total interest in the Plan.

 

(m)            Subject
to the spouse’s right of consent afforded under the Plan, the restrictions
imposed by this Section shall not apply if a Participant has, prior to January
1, 1984, made a written designation to have death benefits paid in an
alternative method acceptable under Code Section 401(a) as in effect prior to
the enactment of the Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA).

 

68

 

6.7          TIME OF DISTRIBUTION

 

Except as
limited by Sections 6.5 and 6.6, whenever a distribution is to be made, or a
series of payments are to commence, the distribution or series of payments may
be made or begun on such date or as soon thereafter as is practicable.  However, unless a Former Participant elects
in writing to defer the receipt of benefits such election may not result in a
death benefit that is more than incidental), the payment of benefits shall
begin not later than the sixtieth (60th) day after the close of the Plan Year
in which the latest of the following events occurs: (a) the date on which the
Participant attains the earlier of age 65 or the Normal Retirement Age
specified herein: (b) the tenth (10th) anniversary of the year in which the
Participant commenced participation in the Plan; or (c) the date the
Participant terminates service with the Employer.

 

Notwithstanding
the foregoing, the failure of a Participant and, if applicable, the
Participant’s spouse, to consent to a distribution that is “immediately
distributable” (within the meaning of Section 6.5(d))), shall be deemed to be
an election to defer the commencement of payment of any benefit sufficient to
satisfy this Section.

 

6.8          DISTRIBUTION FOR MINOR OR INCOMPETENT
BENEFICIARY

 

In the event a
distribution is to he made to a minor or incompetent Beneficiary, then the
Administrator may direct that such distribution be paid to the legal guardian,
or if none in the case of a minor Beneficiary, to a parent of such Beneficiary,
or to the custodian for such Beneficiary under the Uniform Gift to Minors Act
or Gift to Minors Act, if such is permitted by the laws of the state in which
said Beneficiary resides.  Such a payment
to the legal guardian, custodian or parent of a minor or incompetent
Beneficiary shall fully discharge the Trustee, Employer, and Plan from further
liability on account thereof.

 

6.9          LOCATION OF PARTICIPANT OR BENEFICIARY
UNKNOWN

 

In the event
that all, or any portion, of the distribution payable to a Participant or
Beneficiary hereunder shall, at the later of the Participant’s attainment of
age 62 or Normal Retirement Age, remain unpaid solely by reason of the inability
of the Administrator, after sending a registered letter, return receipt
requested, to the last known address, and after further diligent effort, to
ascertain the whereabouts of such Participant or Beneficiary, the amount so
distributable shall be treated as a Forfeiture pursuant to the Plan.  Notwithstanding the foregoing, if the value
of a Participant’s Vested benefit derived from Employer and Employee
contributions does not exceed $5,000, then the amount distributable may be
treated as a Forfeiture at the time it is determined that the whereabouts of
the Participant or the Participant’s Beneficiary can not be ascertained.  In the event a Participant or Beneficiary is
located subsequent to the Forfeiture, such benefit shall be restored, first
from Forfeitures, if any, and then from an additional Employer contribution, if
necessary.  Upon Plan termination, the
portion of the distributable amount that is an “eligible rollover distribution”
as defined in Plan Section 6.14(b)(1) may be paid directly to an individual
retirement account described in Code Section 408(a) or an individual retirement
annuity described in Code Section 408(b). 
However, regardless of the preceding, a benefit that is lost by reason
of escheat under applicable state law is not treated as a Forfeiture for
purposes of this Section nor as an impermissible forfeiture under the Code.

 

69

 

6.10        IN-SERVICE DISTRIBUTION

 

For Profit
Sharing Plans and 401(k) Profit Sharing Plans, if elected, in the Adoption
Agreement, at such time as the conditions set forth in the Adoption Agreement
have been satisfied, then the Administrator, at the election of a Participant
who has not severed employment with the Employer, shall direct the distribution
of up to the entire Vested amount then credited to the accounts as elected in
the Adoption Agreement maintained on behalf of such Participant.  In the event that the Administrator makes
such a distribution, the Participant shall continue to be eligible to participate
in the Plan on the same basis as any other Employee.  Any distribution made pursuant to this
Section shall be made in a manner consistent with Section 6.5,  including, but not limited to, all notice and
consent requirements of Code Sections 411(a)(11) and 417 and the Regulations
thereunder.  Furthermore, if an
in-service distribution is permitted from more than one account type, the
Administrator may determine any ordering of a Participant’s in-service
distribution from such accounts.

 

6.11        ADVANCE DISTRIBUTION FOR HARDSHIP

 

(a)           For
Profit Sharing Plans and 401(k) Plans (except to the extent Section 12.9
applies), if elected in the Adoption Agreement, the Administrator, at the
election of the Participant, shall direct the distribution to any Participant
in any one Plan Year up to the lesser of 100% of the Vested interest of the
Participant’s Combined Account valued as of the last Valuation Date or the
amount necessary to satisfy the immediate and heavy financial need of the
Participant.  Any distribution made
pursuant to this Section shall be deemed to be made as of the first day of the
Plan Year or, if later, the Valuation Date immediately preceding the date of
distribution, and the account from which the distribution is made shall be
reduced accordingly.  Withdrawal under
this Section shall be authorized only if the distribution is for an immediate
and heavy financial need. The Administrator will determine whether there are
immediate and heavy financial need based can the facts and circumstances. An
immediate and heavy financial need includes, but is not limited to, a
distribution for one of the following:

 

(1)           Medical expenses
described in Code Section 213(d) incurred by the Participant, the Participant’s
spouse, or any of the Participant’s dependents (as defined in Code Section 152)
or necessary for these persons to obtain medical  care as described in Code Section 213(d);

 

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

 

(3)           Funeral expenses for a member of the
Participants family;

 

(4)           Payment of tuition, related
educational fees, and room and board expenses, for the next twelve (12) months
of post-secondary education for the Participant, the Participant’s spouse,
children, or dependents as defined in Code Section 152); or

 

70

 

(5)             Payments necessary
to prevent the eviction of the Participant from the Participant’s principal
residence or foreclosure on the mortgage on that residence.

 

(b)             If
elected in the Adoption Agreement, no distribution shall be made pursuant to
this Section from the Participant’s Account until such Account has become fully
Vested.  Furthermore, if a hardship
distribution is permitted from more than one account type, the Administrator
may determine any ordering of a Participant’s hardship distribution from such
accounts.

 

(c)             Any
distribution made pursuant this Section shall be made in a manner which is
consistent with and satisfies the provisions of Section 6.5, including, but not
limited to, all notice and consent requirements of Code Sections 411(a)(11) and
417 and the Regulations thereunder.

 

6.12        SPECIAL
RULE FOR CERTAIN PROFIT SHARING PLANS

 

(a)             The
provisions of this Section apply to a Participant in a Profit Sharing Plan or
401(k) Profit Sharing Plan to the extent elected in the Adoption Agreement.

 

(b)             If
an election is made to not offer life annuities as a form of distribution, then
a Participant shall be prohibited from electing benefits in the form of a life
annuity and the Joint and Survivor Annuity provisions of Section 6.5 shall not
apply.

 

(c)             Notwithstanding
anything in Sections 6.2 and 6.6 to the contrary, upon the death of a
Participant, the automatic form of distribution will be a lump-sum rather than
a Qualified Pre-Retirement Survivor Annuity. 
Furthermore, the Participant’s spouse will be the Beneficiary of the
Participant’s entire Vested interest in the Plan unless an election is made to
waive the spouse as Beneficiary. The other provisions in Section 6.2 shall be
applied by treating the death benefit in this subsection as though it is a
Qualified Pre-Retirement Survivor Annuity.

 

(d)             Except
to the extent otherwise provided in this Section, the provisions of Sections
6.2. 6.5 and 6.6 regarding spousal consent shall be inoperative with respect to
this Plan.

 

(e)             If
a distribution is one to which Code Sections 401(a)(11) and 417 do  not apply, such distribution may commence
less than thirty (30) days after the notice required under Regulation 1.41(a)-11(c)
is given, provided that:

 

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

 

71

 

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

 

6.13        QUALIFIED DOMESTIC RELATIONS ORDER
DISTRIBUTION

 

All rights and
benefits, including elections provided to a Participant in this Plan shall be
subject to the rights afforded to an “alternate payee” under a “qualified
domestic relations order.”  Furthermore,
a distribution to an “alternate payee” shall be permitted if such distribution
is authorized by a qualified domestic relations order,” even if the affected
Participant has not reached the “earliest retirement age” under the
Plan.  For the purposes of this Section,
“alternate payee,” “qualified domestic relations order” and “earliest
retirement age” shall have the meanings set forth under Code Section 414(p).

 

6.14        DIRECT ROLLOVERS

 

(a)           Notwithstanding any
provision of the Plan to the contrary that would otherwise limit a
“distributee’s” election under this Section, a ““distributer” may elect, at the
time and in the manner prescribed by the Administrator, to have any portion of
an “eligible rollover distribution” that is equal to at least $500 paid
directly to an “eligible retirement plain” specified by the ‘‘distributee” in a
“direct rollover.”

 

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

 

(1)           An “eligible rollover distribution”
means any distribution described in Code Section 402(c)(4) and generally
includes any distribution of all or any portion of the balance to the credit of
the distribute, except that an “eligible rollover distribution” does not
include: 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 “distributees” designated
beneficiary, or for a specified period of ten (10) years or more: any
distribution to the extent such distribution is required under Code Section
401(a)(9); 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) for distributions made after
December 31, 1998, any hardship distribution described in Code Section
40l(k)(2)(B)(i)(IV) and any other distribution reasonably expected to total
less than $200 during a year.

 

(2)           An “eligible retirement plan” is an
individual retirement account described in Code Section 408(a), an annuity
retirement annuity described in Code Section 408(b), an annuity plan described
in Code Section 403(a), or a qualified plan described Code Section 401(a), that
accepts the “distributee’s” “eligible rollover distribution.”  However, in the case of an “eligible rollover
distribution” to the surviving spouse, an “eligible retirement plan” is an
individual retirement account or individual retirement annuity.

 

72

 

(3)           A “distributee” includes an Employee
or former Employee.  In addition, the
Employee’s or former Employee’s surviving spouse and the Employee’s or former
Employees 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.

 

(4)           A “direct rollover” is payment by the
Plan to the “eligible retirement plan” specified by the “distributee.”

 

6.15        TRANSFER OF ASSETS FROM A MONEY PURCHASE
PLAN

 

(a)           This Section shall
be effective as of the following date:

 

(1)           for Plans not entitled to extended
reliance as described in Revenue Ruling 94-76, the first day of the first Plan
Year beginning on or after December 12, 1994, or if later, 90 days after
December 12, 1994; or

 

(2)           for Plans entitled to extended
reliance as described in Revenue Ruling 94-76, as of the first day of the first
Plan Year following the Plan Year in which the extended reliance period
applicable to the Plan ends. However, in the event of a transfer of assets to
the Plan from a money purchase plan that occurs after the date of the most
recent determination letter, the effective date of the amendment shall be the
date immediately preceding the date of such transfer of assets.

 

(b)             Notwithstanding
any provision of this Plan to the contrary, to the extent that any optional
form of benefit under this 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(1),
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
after-tax voluntary Employee contributions or to a direct or indirect rollover
contribution).

 

6.16        ELECTIVE TRANSFERS OF BENEFITS TO OTHER
PLANS

 

(a)             If
a voluntary, fully-informed election is made by a Participant, then if the
conditions set forth herein are satisfied, a Participant’s entire benefit may
be transferred between qualified plans (other than any direct rollover
described in Q&A-3 of Regulation 1.40(a)(31)-1).  As an alternative to the transfer, the
Participant may elect to retain the Participant’s “Section 411(d)(6) protected
benefits” under the Plan (or, if the plan is terminating, to receive any
optional form of benefit for which the Participant is eligible under the plan
as required by Code Section 411(d)(6)). A transfer between qualified plans may
only be made pursuant to this subsection if the following additional
requirements are met:

 

73

 

(i)            The  transfer  occurs  at  time  at  which  the  participant’s  benefits  are  distributable.  A  Participant’s  benefits  are  distributable  on  a  particular  date  if,  on  that  date,  the  Participant  is  eligible,  under  the  terms  of  the  Plan,  to  receive  an  immediate  distribution  of  these  benefits  (e.g.,  in  the  form  of  an  immediately  commencing  annuity)  from  that  plan  under  provisions  of  the  plan  not  inconsistent  with  Code  Section  401(a):

 

(ii)           For
transfers that occur on or after January 1, 2002, the transfer occurs at a time
at which the Participant is not eligible to receive an immediate distribution
of the participant’s entire nonforteitable accrued benefit in a
single-sum distribution that would consist entirely of an eligible rollover
distribution within the meaning of Code Section 401(a)(31)(C):

 

(iii)         The participant is
fully Vested in the transferred benefit in the transferee plan;

 

(iv)         In the case of a
transfer from a defined contribution plan to a defined benefit plan, the
defined benefit plan provides a minimum benefit, for each Participant whose
benefits are transferred, equal to the benefit, expressed as an annuity payable
at normal retirement age, that is derived solely on the basis of the amount
transferred with respect to such Participant: and

 

(v)            The amount of the
benefit transferred, together with the amount of any contemporaneous Code
Section 401(a)(31) direct rollover to the transferee plan, equals the
Participant’s entire nonforfeitable accrued benefit under the Plan.

 

(b)           If a voluntary,
fully-informed election is made by as Participant, then if the conditions set
forth herein are satisfied, a Participant’s entire benefit may be transferred
between qualified defined contribution plans lather than any direct rollover
described in Q&A-3 of Regulation 1.40(a)(31)-1).  As an alternative to the transfer, the
Participant may elect to retain the Participant’s “Section 411(d)(6) protected
benefits” under the Plan (or, if the plan is terminating, to receive any optional
form of benefit for which the Participant is eligible under the plan as
required by Code Section 411(d)(6)).  A
transfer between qualified plans may only be made pursuant to this subsection
if the following additional requirements are met:

 

(i)             To the extent the
benefits are transferred from a money purchase pension plan, the transferee
plan must be a money purchase pension plan. To the extent the benefits being
transferred from a part of a qualified cash or deferred arrangement under Code
Section 40l(k), the benefits must be transferred to a qualified cash or
deferred arrangement under Code Section 401(k), 
the benefits must transferred from a profit-sharing plan other than from
a qualified cash or deferred arrangement, or from a stock bonus plan other than
an employee stock ownership plan, may be transferred to any hype of defined
contribution plan: and

 

74

 

(ii)           The transfer must be made either in
connection with an asset or stock acquisition, merger, or other similar
transaction involving a change in employer of the employees of a trade or
business (i.e., an acquisition or disposition within the meaning of Regulation
1.410(b)-2(f)or in connection with the Participant’s change in employment
status to an employment status with respect to which the Participant is not
entitled to additional allocations under the Plan.

 

ARTICLE VII

TRUSTEE ANA CUSTODIAN

 

7.1           BASIC
RESPONSIBILITIES OF THE TRUSTEE

 

(a)           The provisions of
this Article, other than Section 7.6, shall not apply to this Plan if a
separate trust agreement is being used as specified in the Adoption Agreement.

 

(b)           The Trustee is
accountable to the Employer for  the
funds contributed to the Plan by the Employer, but the Trustee does not have
any duty to see that the contributions received comply with the provisions of
the Plan. The Trustee is not obligated to collect any contributions from the
Employer, nor is it under a duty to see that funds deposited with it are
deposited in accordance with the provisions of the Plan.

 

(c)           The Trustee will
credit and distribute the Trust Fund as directed by the Administrator, The
Trustee is not obligated to inquire as to whether any payee or distrubutee is
entitled to any payment or whether the distribution is proper or within the
terms of the Plan, or whether the manner of making any payment or distribution
is proper.  The Trustee is accountable
only to the Administrator for any payment or distribution made by it in good
faith on the order or direction of the Administrator.

 

(d)           In the event that
the Trustee shall be directed by a Participant (pursuant to the Participant
Direction Procedures if the Plan permits Participant directed investments), the
Employer, or an Investment Manager or other agent appointed by the Employer
with respect to the investment of such assets, the Trustee shall have no
liability with respect to the investment of such assets, but shall be
responsible only to execute such investment instructions as so directed.

 

(1)          The Trustee shall be entitled to rely
fully on the written or other form acceptable to the Administrator and the
Trustee, including but not limited to, voice recorded) instructions of a
Participant (pursuant to the Participant Direction Procedures), the Employer,
or any Fiduciary or nonfiduciary agent of the Employer, in the discharge of
such duties, and shall not be liable for any loss or other liability resulting
from such direction (or lack of direction) of the investment of any part of the
Plan assets.

 

75

 

(2)         The Trustee may
delegate the duty of executing such instructions to any nonfiduciary agent,
which may be an affiliate of the Trustee or any Plan representative.

 

(3)         The Trustee may refuse
to comply with any direction from the Participant in the event the Trustee, in
its sole and absolute discretion, deems such direction improper by virtue of
applicable law.  The Trustee shall not be
responsible or liable for any loss or expense that may result from the
Trustee’s refusal or failure to comply with any direction from the Participant.

 

(4)         Any costs and expenses
related to compliance with the Participant’s directions shall be
borne by the Participant’s Directed Account, unless paid by the
Employer.

 

(5)         Notwithstanding
anything herein above to the contrary, the Trustee shall not invest any portion
of a Participant’s Directed Account in “collectibles” within the meaning of
Code Section 408(m).

 

(e)           The Trustee will maintain records of
receipts and disbursements and furnish to the Employer and/or Administrator for
each Plan Year a Written annual report pursuant to Section 7.9.

 

(f)            The Trustee may employ a bank or
trust company pursuant to the terms of its usual and customary bank agency
agreement, under which the duties of such bank or trust company shall be of a
custodial, clerical and record-keeping nature.

 

(g)           The Trustee may employ and pay from
the Trust Fund reasonable compensation to agents, attorneys, accountants and
other persons to advise the Trustee as in its opinion may be necessary.  The Trustee may delegate to any agent,
attorney, accountant or other person selected by it any non-Trustee power or
duty vested in it by the Plan, and the Trustee may act or refrain from acting
on the advice or opinion of any such person.

 

7.2          INVESTMENT POWERS AND DUTIES OF
DISCRETIONARY TRUSTEE

 

(a)             This
Section applies if the Employer, in the Adoption Agreement or as otherwise
agreed upon by the Employer and the Trustee, designates the Trustee to
administer all or a portion of the trust as a discretionary Trustee.  If so designated, then the Trustee has the
discretion and authority to invest, manage, and control those Plan assets
except, however, with respect to those assets which are subject to the investment
direction of a Participant (if Participant directed investments are permitted),
or an Investment Manager, the Administrator, or other agent appointed by the
Employer.  The exercise of any investment
discretion hereunder shall be consistent with the “funding policy and method”
determined by the Employer.

 

(b)             The
Trustee shall, except as otherwise provided in this Plan, invest and reinvest
the Trust Fund to keep the Trust Fund invested without distinction between
principal and income and in such securities or property, real or personal,
wherever situated, as the Trustee shall deem advisable, including, but not
limited to, common or 

 

76

 

preferred
stocks, open-end or closed-end mutual funds, bonds and other evidences of
indebtedness or ownership, and real estate or any interest therein.  The Trustee shall at all times in making
investments of the Trust Fund consider, among other factors the short and
long-term financial needs of the Plan on the basis of information furnished by
the Employer.  In making such
investments, the Trustee shall not be restricted to securities or other
property of the character expressly authorized by the applicable law for trust
investments; however, the Trustee shall give due regard to any limitations
imposed by the Code or the Act so that at all times this Plan may qualify as a
qualified Plan and Trust.

 

(c)             The
Trustee, in addition to all powers and authorities under common law, statutory
authority, including the Act, and other provisions of this Plan, shall have the
following powers and, authorities to be exercised in the Trustee’s sole
discretion:

 

(1)             To purchase, or
subscribe for, any securities or other property and to retain the same.  In conjunction with the purchase of
securities, margin accounts may be opened and maintained;

 

(2)             To sell, exchange,
convey, transfer, grant options to purchase, or otherwise dispose of any
securities or other property held by the Trustee, by private contract or at
public auction.  No person dealing with
the Trustee shall be bound to see to the application of the purchase money or
to inquire into the validity, expediency, or propriety of any such sale other
disposition, with or without advertisement;

 

(3)             To vote upon any
stocks, bonds, or other securities:  to
give general or special proxies or powers of attorney with or without power of
substitution: to exercise any conversion privileges, subscription rights or
other options, and to make any payments incidental thereto: to oppose, or to
consent to or otherwise participate in, corporate reorganizations or other
changes affecting corporate securities, and to delegate discretionary powers,
and to pay any assessments or charges in connection therewith; and generally to
exercise any of the powers of an owner with respect to stocks, bonds, securities,
or other property.  However, the Trustee
shall not vote proxies relating to securities for which it has not been
assigned full investment management responsibilities. In those cases where
another party has such investment authority or discretion, the Trustee will
deliver all proxies to said party who will then have full responsibility for
voting those proxies;

 

(4)           To cause any securities or other
property to be registered in the Trustee’s own name, in the name of one or more
of the Trustee’s nominees, in as clearing corporation, in a depository, or in
book entry form or in bearer form, but the books and records of the Trustee
shall at all times show that all such investments are part of the Trust Fund;

 

77

 

(5)           To invest in a common, collective, or
pooled trust fund (the provisions of which are incorporated herein by
reference) maintained by any Trustee (or any affiliate of such Trustee)
hereunder pursuant to Revenue Ruling 8.1- 100, all or such part of the Trust
Fund as the Trustee may deem advisable, and the part of the Trust Fund so
transferred shall be subject to all the terms and provisions of the common,
collective, or pooled trust fund which contemplate the commingling for
investment purposes of such trust assets of other trusts. The name of the trust
fund may be specified in an addendum to the Adoption Agreement.  The Trustee may withdraw from such common,
collective, or pooled trust fund all or such part of the Trust Fund as the
Trustee may deem advisable;

 

(6)           To  borrow  or  raise  money  for  the  purposes  of  the  Plan  in  such  amount,  and  upon  such  terms  and  conditions,  as  the  Trustee  Shall  deem  advisable;  and  for  any  sum  so  borrowed,  to  issue  a  promissory  note  as  Trustee,  and  to  secure  the  repayment  thereof  by  pledging  all,  or  any  part,  of  the  Trust  Fund;  and  no  person  lending  money  to  the  Trustee  shall  be  bound  to  see  the  to  the  application  of  the  money  lent  or  to  inquire  into  the  validity,  expediency,  or  propriety  of  any  borrowing;

 

(7)           To accept and retain
for such time as it may deem advisable any securities or other property
received or acquired by it as Trustee hereunder, whether or not such securities
or other property would normally he purchased as investments hereunder;

 

(8)             To make, execute,
acknowledge, and deliver any and all documents of transfer and conveyance and
any and all other instruments that may be necessary or appropriate to carry out
the powers herein granted;

 

(9)             To settle,
compromise, or submit to arbitration any claims, debts, or damages due or owing
to or from the Plan, to commence or defend suits or legal or administrative
proceedings, and to represent the Plan in all suits and legal and
administrative proceedings;

 

(10)           To employ suitable
agents and counsel and to pay their reasonable expenses and compensation, and
such agents or counsel may or may not be an agent or counsel for the Employer;

 

(11)           To apply for and
procure from the Insurer as an investment of the Trust Fund any annuity or
other Contracts (on the life of any Participant, or in the case of a Profit
Sharing Plan (including a 401(k) plan), on the life of any person in whom a
Participant has an insurable interest, or on the joint lives of a Participant
and any person in whom the Participant has an insurable interest) as the
Administrator shall deem proper; to exercise, at any time or from time to time,
whatever rights and privileges may be granted under such annuity or other
Contracts; to collect, receive, and settle for the proceeds of all such
annuity, or other Contracts as and when entitled to do so under the provisions
thereof;

 

78

 

(12)           To invest funds of
the Trust in time deposits or savings accounts bearing as reasonable rate of
interest or in cash or cash balances without liability for interest thereon,
including the specific authority to invest in any type of deposit of the
Trustee (or of a financial institution related to the Trustee);

 

(13)           To invest in
Treasury Bills and other forms of United States government obligations:

 

(14)           To sell, purchase
and acquire put or call options it the options are traded on and purchased
through a national securities exchange registered under the Securities Exchange
Act of 1934, as amended, or, if the options are not traded on a national
securities exchange, are guaranteed by a member firm of the New York Stock
Exchange regardless of whether such options are covered;

 

(15)           To deposit monies
in federally insured savings accounts or certificates of deposit in banks or
savings and loan associations including the specific authority to make deposit
into any savings accounts or certificates of deposit of the Trustee (or a
financial institution related to the Trustee);

 

(16)           To pool all or any
of the Trust Fund, from time to time, with assets belonging to any other
qualified employee pension benefit trust treated by the Employer or any
Affiliated Employer, and to commingle such assets and make Joint or common
investments and carry joint accounts on behalf of this Plan and Trust and such
other trust or trusts, allocating undivided shares or interests such
investments or accounts or any pooled assets of the two or more trusts in
accordance with their respective interests; and

 

(17)           To do all such acts
and exercise all such rights and privileges, although not specifically
mentioned herein, as the Trustee may deem necessary to carry out the purposes
of the Plan

 

7.3          INVESTMENT POWERS AND DUTIES OF
NONDISCRETIONARY TRUSTEE

 

(a)           This Section applies if the Employer,
in the adoption Agreement or as otherwise agreed upon by the Employer and the
Trustee, designates the Trustee to administer all or a portion of the trust as
a nondiscretionary Trustee. If so designated then the Trustee shall have no
discretionary authority to invest, manage, or control those Plan assets, but
must act solely as a directed Trustee of those Plan assets nondiscretionary
Trustee, as directed Trustee of the Plan funds it holds, is authorized and
empowered, by way of limitation, with the powers, rights and duties set forth herein
and in Section 7.14, each of which the nondiscretionary Trustee exercises
solely as directed Trustee in accordance with the direction of the party which
has the authority to manage and control the investment of the Plan assets. If
no directions are provided to the Trustee, the Employer will provide necessary
direction.  Furthermore, the Employer and
the nondiscretionary Trustee may, in writing, limit the powers of the
nondiscretionary Trustee to any combination of powers listed within this
Section.

 

79

 

(b)             The Trustee, in
addition to all powers and authorities under common law, statutory authority,
including the Act and other provisions of this Plan, shall have the following
powers and authorities:

 

(1)             To invest the
assets, without distinction between principal and income, in securities or
property, real or personal, wherever situated, including, but not limited to,
common or preferred stocks, open-end or closed-end mutual funds, bonds and
other evidences of indebtedness or ownership, and real estate or any interest
therein.  In making such investments, the
Trustee shall not be restricted to securities or other property of the
character expressly authorized by the applicable law for trust investments; however,
the Trustee shall give due regard to any limitations imposed by the Code or the
Act so that at all times this Plan may qualify as a qualified Plan and Trust.

 

(2)             To purchase, or
subscribe for, any securities or other property and to retain the same.  In conjunction with the purchase of
securities, margin accounts may be opened and maintained:

 

(3)             To sell, exchange,
convey, transfer, grant options to purchase or otherwise dispose of any
securities or other property held by the Trustee, by private contract or at
public auction.  No person dealing with
the Trustee shall be bound to see to the application of the purchase money or
to inquire into the validity, expediency, or propriety of any such sale or
other disposition, with or without advertisement;

 

(4)             At the direction
or the party which has the authority or discretion, to vote upon any stocks,
bonds, or other securities; to give general or special proxies or powers of
attorney with or without power of substitution; to exercise any conversion
privileges, subscription rights or other options, and to make any payments
incidental thereto; to oppose, or to consent to, or otherwise participate in,
corporate reorganizations or other changes affecting corporate securities and
to delegate powers, and pay any assessments or charges in connection therewith;
and generally to exercise any of the powers of an owner with respect to stocks,
bonds, securities, or other property;

 

(5)             To cause any
securities or other property to be registered in the Trustee’s own name, in the
name of one or more of the Trustee’s nominees, in a clearing corporation, in to
depository, or in book entry form or in bearer forms but the books and records
of the Trustee shall at all times show that all such investments are part of
the Trust Fund;

 

(6)             To  invest  in  a  common,  collective,  or  pooled  trust  fund  (the  provisions  of  which  are  incorporated  herein  by  reference)  maintained  by  an  Trustee  (or  any  affiliate  of  such  Trustee)  hereunder  pursuant  to  Revenue  Ruling  81-100,  all  or  

 

80

 

such part of
the Trust Fund as the party which has the authority to manage and control the
investment of` the assets shall deem advisable, and the part of the Trust Fund
so transferred shall be subject to all the terms and provisions of the common,
collective, or pooled trust fund which contemplate the commingling for
investment purposes of such trust assets with trust assets of other
trusts.  The name of the trust fund may
be specified in an addendum to the Adoption Agreement;

 

(7)             To borrow or raise
money for the purposes of the Plan in such amount, and upon such terms and
conditions, as the Trustee shall deem advisable; and for any sum so borrowed,
to issue a promissory note as Trustee, and to secure the repayment thereof by
pledging all, any part, of the Trust Fund; and no person lending money to the
Trustee shall be bound to see to the application of the money lent or to
inquire into the validity, expediency, or propriety of any borrowing;

 

(8)             To make, execute,
acknowledge, and deliver any and all documents of transfer and conveyance and
any and all other instruments that may be necessary or appropriate to early out
the powers herein granted;

 

(9)             To settle,
compromise, or submit to arbitration any claims, debts, or damages due or owing
to or from the Plan, to commence or defend suits or legal administrative
proceedings, and to represent the Plan in all writs and legal and
administrative proceedings;

 

(10)           To employ suitable
agents and counsel and to pay their reasonable expenses and compensation, and
such agent or counsel may or may not be an agent or counsel for the Employer;

 

(11)           To apply for and
procure from the Insurer as an investment of the Trust Fund any annuity or
other Contracts (on the life of any Participant, on in the case of a Profit
Sharing Plan (including a 401(k) plan), on the life of any person in whom a
Participant has an insurable interest, or on the joint lives of a Participant
and any person in whom the Participant has an insurable interest) as the
Administrator shall deem proper; to exercise, at the direction of the person
with the authority to do so, whatever rights and privileges may be granted
under such annuity or other Contracts; to collect, receive, and settle for the
proceeds of all such annuity or other Contracts as and when entitled to do so
under the provisions thereof;

 

(12)           To invest funds of
the Trust in time deposits or savings accounts bearing a reasonable rate of
interest or in cash or cash balances without liability for interest thereon,
including the specific authority to invest in any type of deposit of the
Trustee (or of a financial institution related to the Trustee);

 

(13)           To invest in
Treasury Bills and other forms of United States government obligations;

 

81

 

(14)         To sell purchase and
acquire put or call options if the options are traded on and purchased through
a national securities exchange registered under the Securities Exchange Act of
1934, as amended, or, if the options are not traded on a national securities
exchange, are guaranteed by a member firm of the New York Stock Exchange
regardless of whether such options are covered;

 

(15)         To deposit monies in
federally insured savings accounts or certificates of deposit in banks or
savings and loan associations including the specific authority to make deposit
into any savings accounts or certificates of deposit of the Trustee (or a
financial institution related to the Trustee); and

 

(16)         To pool all or any of
the Trust Fund, from time to time, with assets belonging to any other qualified
employee pension benefit trust created by the Employer or any Affiliated
Employer, and to commingle such assets and make joint or common investments and
carry joint accounts on behalf of this Plan and such other trust or trusts,
allocating undivided shares interests in such investments or accounts or any
pooled assets of the two or more trusts in accordance with their respective
interests.

 

7.4          POWERS
AND DUTIES OF CUSTODIAN

 

If there is a discretionary Trustee, the
Employer may appoint a custodian.  A
custodian has the same powers, rights and duties as a nondiscretionary Trustee.
Any reference in the  Plan to a
Trustee also is a reference to a custodian unless the context of the Plan
indicates otherwise. A limitation of the Trustee’s liability by Plan provision
also acts as a limitation of the custodian’s liability. Any action taken by the
custodian at the discretionary Trustee’s direction satisfies any provision in
the Plan referring to the Trustee taking that action. The resignation or
removal of the custodian shall be made in accordance with Section 7.11 as
though the custodian were a Trustee.

 

7.5          LIFE
INSURANCE

 

(a)           The Trustee, at the
direction of the Administrator and pursuant to instructions from the individual
designated in the Adoption Agreement for such purpose and subject to the
conditions set forth in the Adoption Agreement, shall ratably apply for, own,
and pay all premiums on Contracts on the lives of the Participants or, in the
case of Profit Sharing Plan (including a 401(k) plan), on the life of any
person in whom the Participant has an insurable interest or on the joint lives
of a Participant and any person in whom the Participant has an insurable
interest. Any initial or additional Contract purchased on behalf of a Participant
shall have as face amount of not less than $1,000, the amount set forth the
Adoption Agreement, or the limitation of the Insurer, whichever is
greater.  If a life insurance Contract is
to be purchased for a Participant or Former Participant, then the aggregate
premium for ordinary life insurance for each Participant or Former Participant
must be less than 50% of the aggregate contributions and Forfeitures allocated
to the Participant’s or Former Participant’s Combined Account.  For purposes

 

82

 

of this limitation, ordinary life insurance Contracts are Contracts
with both non-decreasing death benefits and non-increasing premiums.  If term insurance or universal life insurance
is purchased, then the aggregate premium must be 25% or less of the aggregate
contributions and Forfeitures allocated to the Participant’s or Former
Participant’s Combined Account.  If both
term insurance and ordinary life insurance are purchased, then the premium for
term insurance plus one-half of the premium for ordinary life insurance may not
in the aggregate exceed 25% of the aggregate Employer contributions and
Forfeiture allocated to the Participant’s or Former Participant’s Combined
Account.  Notwithstanding the preceding,
the limitations imposed herein with respect to the purchase of life insurance
shall not apply, in the case of a Profit Sharing Plan (including a 401(k) plan),
to the portion of the Participant’s Account that has accumulated for at least
two (2) Plan Years or to the entire Participant’s Account if the
Participant has been a Participant in the Plan for at least five (5) years.  Amounts transferred to this Plan in
accordance with Section 4.6(e)(ii) or (v) and a Participant’s or
Former Participant’s Voluntary Contribution Account may be used to purchase
Contracts without limitation.

 

(b)           The Trustee must
distribute the Contracts to the Participant or Former Participant or convert
the entire value of the Contracts at or before retirement into cash or provide
for a periodic income so that no portion of such value may be used to continue
life insurance protection beyond commencement of benefits.  Furthermore, if a Contract is purchased on
the joint lives of the Participant and another person and such other person
predeceases the Participant, then the Contract may not be maintained under this
Plan.

 

(c)           Notwithstanding
anything herein above to the contrary, amounts credited to a Participant’s
Qualified Voluntary Employee Contribution Account pursuant to Section 4.9,
shall not be applied to the purchase of life insurance Contracts.  Furthermore, no life insurance Contracts
shall be required to be obtained on an individual’s life if, for any reason
(other than the nonpayment of premiums) the Insurer will not issue a Contract
on such individual’s life.

 

(d)           The Trustee will be
the owner of any life insurance Contract purchased under the terms of this
Plan.  The Contract must provide that the
proceeds will be payable to the Trustee; however, the Trustee shall be required
to pay over all proceeds of the Contract to the Participant’s designated
Beneficiary in accordance with the distribution provisions of Article VI.  A Participant’s spouse will be the designated
Beneficiary pursuant to Section 6.2, unless a qualified election has been
made in accordance with Sections 6.5 and 6.6 of the Plan, if applicable. Under
no circumstances shall the Trust retain any part of the proceeds that are in
excess of the cash surrender value immediately prior to death. However, the
Trustee shall not pay the proceeds in a method that would violate requirements
of the Retirement Equity pct of 1984, as stated in Article VI of the Plan,
or Code Section 401(a)(9) and the Regulations thereunder.  In the event of any conflict between she
terms of this Plan and the terms of any insurance Contract purchased hereunder,
the Plain provisions shall control.

 

83

 

7.6          LOANS
TO PARTICIPANTS

 

(a)           If specified in the
Adoption Agreement, the Trustee for the Administrator if the Trustee is a
nondiscretionary Trustee or if loans are treated as Participant directed
investments pursuant to the Adoption Agreement) may, in the Trustees (or if
applicable, the Administrator’s) sole discretion, make loans to Participants or
Beneficiaries under the following circumstances; (1) loans shall be made
available to all Participants and Beneficiaries on a reasonably equivalent
basis; (2) loans shall not be made available to Highly Compensated
Employees in an amount greater than the amount made available to other
Participants; (3) loans shall bear a reasonable rate of interest; (4) loans
shall be adequately secured; and (5) loans shall provide for period
repayment over a reasonable period of time. 
Furthermore, no Participant loan shall exceed the Participant’s Vested
interest in the Plan.

 

(b)           Loans shall not be
made to any Shareholder-Employee or Owner-Employee (including an Owner-Employee’s
family members as defined in Code Section 267(c)(4) unless an
exemption for such loan is obtained pursuant to Act Section 408 or such
loan would otherwise not be a prohibited transaction pursuant to Code Section 4975
and Act Section 408.

 

(c)           An assignment or
pledged any portion of a Participant’s interest in the Plan and a loan, pledge,
or assignment with respect to any insurance Contract purchased under the Plan,
shall be treated as a loan under this Section.

 

(d)           If the Vested
interest of a Participant is used to secure any loan made pursuant to this
Section, then the written (or such other form as permitted by the IRS) consent
of the Participant’s spouse shall be required in a manner consistent with Section 6.5(a),
provided the spousal consent requirements of such Section apply to the
Plan.  Such consent must be obtained
within the 90-day period prior to the date the loan is made.  Any security interest held by the Plan by
reason of an outstanding loan to the Participant or Former Participant shall be
taken into account in determining the amount of the death benefit or
Pre-Retirement Survivor Annuity. 
However, unless the loan program established pursuant to this Section provides
otherwise, no spousal consent shall be required under this paragraph if the
total interest subject to the security is not in excess of $5,000 (or, $3,500
effective for loans made prior to the later of the first day of the first Plan
Year beginning after August 5, 1997, or the date specified in the Adoption
Agreement).

 

(e)           The Administrator
shall he authorized to establish a participant loan program to provide for
loans under the Plan. The loan program shall be established in accordance with
Department of Labor Regulation Section 2550.408(b)-1(d)(2) providing for
loans by the Plan to parties-in-interest under said Plan, such as Participants
or Beneficiaries. In order for the Administrator to implement such loan
program, a separate written document forming a part of this Plan must be
adopted, which document shall specifically include, but need not be limited to,
the following:

 

84

 

(1)                                  the identity of the
person or positions authorized to administer the Participant loan program;

 

(2)           a procedure for
applying for loans;

 

(3)           the basis on which
loans will be approved or denied;

 

(4)           limitations, if any,
on the types and amounts of loans offered;

 

(5)           the procedure under
the program for determining a reasonable rate of interest;

 

(6)           the types of
collateral which may secure as Participant loan; and

 

(7)                                  the events
constituting default and the steps that will be taken to preserve Plan assets
in the event of such default.

 

(f)            Notwithstanding
anything in this Plan to the contrary, if a Participant or Beneficiary defaults
on a loan made pursuant to this Section that is secured by the Participant’s
interest in the Plan, then a Participant’s interest may be offset by the amount
subject to the security to the extent there is a distributable event permitted
by the Code or Regulations.

 

(g)           Notwithstanding
anything in this Section to the contrary, if this is an amendment and
restatement of an existing Plan, any loans made prior to the date this
amendment and restatement is adopted shall be subject to the terms of the Plan
in effect at the time such loan was made.

 

7.7          MAJORITY
ACTIONS

 

Except where there has been an allocation and delegation of powers, if
there shall be more than one Trustee, they shall act by a majority of their
number, but may authorize one or more of them to sign papers on their behalf.

 

7.8           TRUSTEE’S
COMPENSATION AND EXPENSES AND TAXES

 

The Trustee shall be paid such reasonable compensation as set forth in
the Trustee’s fee schedule (if the Trustee has such a schedule) or as agreed
upon in writing by the Employer and the Trustee. However, an individual serving
as Trustee who already receives full-time compensation from the Employer shall
not receive compensation from this Plan. 
In addition, the Trustee shall be reimbursed for any reasonable
expenses, including reasonable counsel fees incurred by it as Trustee.  Such compensation and expenses shall be paid
from the Trust Fund unless paid or advanced by the Employer.  All taxes of any kind whatsoever that may be
levied or assessed under existing or future laws upon, or in respect of, the
Trust Fund or the income thereof, shall be paid from the Trust Fund.

 

85

 

7.9           ANNUAL REPORT OF THE TRUSTEE

 

(a)             Within
a reasonable period of time after the later of the Anniversary Date or receipt
of the Employer’s contribution for each Plan Year, the Trustee, or its agent,
shall furnish to the Employer and Administrator a written statement of account
with respect to the Plan Year for which such contribution was made setting
forth:

 

(1)             the
net income, or loss, of the Trust fund;

 

(2)             the
gains, or losses, realized by the Trust Fund upon sales or other disposition of
the assets;

 

(3)             the
increase, or decrease, in the value of the Trust Fund;

 

(4)             all
payments and distributions made from the Trust fund; and

 

(5)             such
further information as the Trustee and/or Administrator deems appropriate.

 

(b)             The
Employers, promptly upon its receipt of each such statement of account, shall
acknowledge receipt thereof in writing and advise the Trustee and/or
Administrator of its approval or disapproval thereof.  Failure by the Employer to disapprove any
such statement of account within thirty (30) days after its receipt thereof
shall be deemed an approval thereof. The approval by the Employer of any
statement of account shall be binding on the Employer and the Trustee as to all
matters contained in the statement to the same extent as if the account of the
Trustee had been settled by judgment or decree in an action for a judicial
settlement of its account in a court of competent jurisdiction which the
Trustee, the Employer and all persons having or claiming an interest in the
Plan were parties.  However, nothing
contained in this Section shall deprive the Trustee of its right to have
its accounts judicially settled if the Trustee so desires.

 

7.10        AUDIT

 

(a)           If an audit of the
Plan’s records shall be required by the Act and the regulations thereunder for
any Plan Year, the Administrator shall engage on behalf of all Participants an
independent qualified public accountant or that purpose. Such accountant shall,
after an audit of the books and records of the Plan in accordance with
generally accepted auditing standards, within a reasonable period after the
close of the Plan Year, furnish to the Administrator and the Trustee a report
of the audit setting forth the accountant’s opinion as to whether any
statements, schedules or lists, that are required by Act Section 103 or
the Secretary of Labor to be filed with the Plan’s annual report, are presented
fairy in conformity with generally accepted accounting principles applied
consistently.

 

(b)           All
auditing and accounting fees shall be an expense of and may, at the election of
the Employer, be paid from the Trust Fund.

 

86

 

(c)           If
some or all of the information necessary to enable the Administrator to comply
with Act Section 103 is maintained by a bank, insurance company, or
similar institution, regulated, supervised, and subject to periodic examination
by a state or federal agency then it shall transmit and certify the accuracy of
that information to the Administrator as provided in Act Section 103(b) within
one hundred twenty (120) days after the end of the Plan Year or such other date
as may be prescribed under regulations at the Secretary of Labor.

 

7.11        RESIGNATION.
REMOVAL AND SUCCESSION’ OF TRUSTEE

 

(a)           Unless
otherwise agreed to by both the Trustee and the Employer, a Trustee may resign
at any time by delivering to the Employer, at least thirty (30) days before its
effective date, a written notice of resignation.

 

(b)           Unless
otherwise agreed to by both the Trustee and the Employer, the Employer may
remove a Trustee at any time by delivering to the Trustee, at least thirty (30)
days before its effective date, a written notice of such Trustee’s removal.

 

(c)           Upon
the death, resignation, incapacity, or removal of any Trustee, a successor may
be appointed by the Employer; and such successor, upon accepting such
appointment in writing and delivering same to the Employer, shall, without
further act, become vested with all the powers and responsibilities of the
predecessor as if such successor had been originally named as a Trustee herein.
Until such a successor is appointed, any remaining Trustee or Trustees shall
have full authority to act under the terms of the Plan.

 

(d)           The
Employer may designate one or more successors prior to the death, resignation,
incapacity, or removal of a Trustee.  In
the event a successor is so designated by the Employer and accepts such
designation, the successor shall, without further act, become vested with all
the powers and responsibilities of the predecessor as if such successor had
been originally named as Trustee herein immediately upon the death,
resignation, incapacity, or removal of the predecessor.

 

(e)           Whenever
any Trustee hereunder ceases to serve  as
such, the Trustee shall furnish to the Employer and Administrator a written
statement of account with respect to the portion of the Plan Year during which
the individual or entity served as Trustee. This statement shall be either (i) included
as part of the annual statement of account for the Plan Year required under Section 7.9
or (ii) set forth in a special statement. Any such special statement of
account should be rendered to the Employer no later than the due date of the
annual statement of account for the Plan Year. The procedures set forth in Section 7.9
for the approval by the Employer of annual statements of account shall apply to
any special statement of account rendered hereunder and approval by the
Employer of an such special statement in the manner provided in Section 7.9
shall have the same effect upon the statement as the Employer’s approval of an
annual statement of account. No successor to the Trustee shall have any duty or
responsibility to investigate the acts or transactions of any predecessor who
has rendered all statements of account required by Section 7.9 and this
subparagraph.

 

87

 

7.12        TRANSFER
OF INTEREST

 

Notwithstanding any other provision contained in this Plan, the Trustee
at the direction of the Administrator shall transfer the interest, if any, of a
Participant to another trust forming part of a pension, profit sharing, or
stock bonus plan that meets the requirements of Code Section 401(a),
provided that the trust to which such transfers are made permits the transfer
to be made.

 

7.13        TRUSTEE
INDEMNIFICATION

 

The Employer agrees to indemnify and hold harmless the Trustee against
any and all claims, losses, damages, expenses and liabilities the Trustee may
incur in the exercise and performance of the Trustee’s powers and duties hereunder,
unless the same are determined to be due to gross negligence or willful
misconduct.

 

7.14        EMPLOYER
SECURITIES AND REAL PROPERTY

 

The Trustee shall be empowered to acquire and hold “qualifying Employer
securities” and “qualifying Employer real property,” as those terms are defined
in the Act. However, no more than one hundred percent (100%), in the case of a
Profit Sharing Plan or 401(k) Plan, or ten percent (10%), in case of a
Money Purchase Plan, of the fair market value of all the assets in the Trust
Fund may be invested in “qualifying Employer securities” and “qualifying
Employer real property.”

 

Notwithstanding the preceding, for Plan Years beginning after December 31,
1998, if the Plan does not permit Participants to direct the investment of their
Participants’ Elective Deferral Accounts, then the Trustee shall only be
permitted to acquire or hold “qualifying Employer securities” and “qualifying
Employer real property” to the extent permitted under Act Section 407.

 

ARTICLE VIII

AMENDMENT, TERMINATION AND MERGERS

 

8.1           AMENDMENT

 

(a)           The Employer shall have the right at
any time to amend this Plan subject to the limitations of this Section.  However, any amendment that affects the
rights, duties or responsibilities of the Trustee or Administrator may only be
made with the Trustee or Administrator’s written consent.  Any such amendment shall become effective as
provided therein upon its execution.  The
Trustee shall not he required to execute any such amendment unless the amendment
affects the duties of the Trustee hereunder.

 

88

 

(b)           The Employer may (1) change the
choice of options in the Adoption Agreement, (2) add any addendum to the
Adoption Agreement that is specifically permitted pursuant to the terms of the
Plan, (3) add overriding language to the Adoption Agreement when such
language is necessary to satisfy Code Sections 415 or 416 because of the
required aggregation of multiple plans, and (4) add certain model
amendments published by the Internal Revenue Service which specifically provide
that their adoption will not cause the Plan to be treated as an individually
designed plan.  An Employer that amends
the Plan for any other reason, including a waiver of the minimum funding
requirement under Code Section 412(d), will no longer participate in this
Prototype Plan and this Plan will be considered to be an individually designed
plan.  Notwithstanding the preceding, the
attachment to the Adoption Agreement of any addendum specifically authorized by
the Plan or a list of any “Section 411(d)(6) protected benefits”
which must be preserved shall not be considered an amendment to the Plan.

 

(c)           The Employer expressly delegates
authority to the sponsor of this Prototype Plan, the right to amend each Employer’s
Plan by submitting a copy of the amendment to each Employer who has adopted
this Prototype Plan, after first having received a ruling or favorable
determination from the Internal Revenue Service that the Prototype Plan as
amended qualifies under Code Section 401(a) and the Act (unless a
ruling or determination is not required by the IRS).  For purposes of this Section, the mass
submitter shall be recognized as the agent of the sponsor.  If the sponsor does not adopt any amendment
made by the mass submitter, it will no longer be identical to, or a minor
modifier of, the mass submitter plan.

 

(d)           No amendment to the Plan shall be
effective if it authorizes or permits any part of the Trust Fund (other than
such part as is required to pay taxes and administration expenses) to be used
for or diverted to any purpose other than for the exclusive benefit of the
Participants or their Beneficiaries or estates: 
or causes any reduction in the amount credited to the account of any
Participant:  or causes or permits any
portion of the Trust Fund to revert to or become property of the Employer.

 

(e)           Except as permitted by Regulations
(including Regulation 1.411(d )-4) or other IRS guidance, no Plan amendment or
transaction having the effect of a Plan amendment (such as a merger, plan
transfer or similar transaction) shall be effective if it eliminates or reduces
any “Section 411(d)(6) protected benefit” or adds or modifies
conditions relating to “Section 411(d)(6) protected benefits’’
which results in a further restriction on such benefits unless such “Section 411(d)(6)
protected benefits” are preserved with respect to benefits accrued as of the
later of the adoption date or effective date of the amendment, “Section 4(d)(6) protected
benefits” are benefits described in Code Section 411(d)(6)(A), early
retirement benefits and retirement-type subsidies, and optional forms of
benefit.  A Plan amendment that
eliminates or restricts the ability of a Participant to receive payment of the
Participant’s interest in the Plan under a particular optional form of benefit
will be permissible if the amendment satisfies the conditions in (1) and (2) below:

 

(1)           The
amendment provides a single-sum distribution form that is otherwise identical
to the optional form of benefit eliminated or restricted.  For purposes of this condition (1), a
single-sum distribution form is

 

89

 

otherwise identical only if it is identical
in all respects to the eliminated or restricted optional form of benefit (or
would be identical except that it provides greater rights to the Participant)
except with respect to the timing of payments after commencement.

 

(2)           The
amendment is not effective unless the amendment provides that the amendment
shall not apply to any distribution with an Annuity Starting Date earlier than
the earlier of:  (i) the ninetieth
(90th) day after the date the Participant receiving the distribution
has been furnished a summary that reflects the amendment and that satisfies the
Act requirements at 29 CFR 2520.104b-3 (relating to a summary of material
modifications) or (ii) the first day of the second Plan Year following the
Plan Year in which the amendment is adopted.

 

8.2          TERMINATION

 

(a)           The Employer shall have the right at
any time to terminate the Plan by delivering to the Trustee and Administrator
written notice of such termination.  Upon
any full or partial termination, all amounts credited to the affected
Participants’ Combined Accounts shall become 100% Vested and shall not
thereafter be subject to forfeiture, and all unallocated amounts, including
Forfeitures, shall be allocated to the accounts of all Participants in
accordance with the provisions hereof.

 

(b)           Upon the full termination of the
Plan, the Employer shall direct the distribution of the assets to Participants
in a manner that is consistent with and satisfies the provisions of Section 6.5.  Distributions to a Participant shall be made
in cash (or in property if permitted in the Adoption Agreement) or through the
purchase of irrevocable nontransferable deferred commitments from the
Insurer.  Except as permitted by
Regulations the termination of the Plan shall not result in the reduction of “Section 411(d)(6) protected
benefits” as described in Section 8.1(e).

 

8.3          MERGER,
CONSOLIDATION OR TRANSFER OF ASSETS

 

This Plan may be merged or consolidated with, or its assets and/or
liabilities may be transferred to any other plan only if the benefits which
would be received by a Participant of this Plan, in the event of a termination
of the plan immediately after such transfer, merger or consolidation, are at
least equal to the benefits the Participant would have received if the Plan had
terminated immediately before the transfer, merger or consolidation and such
transfer, merger or consolidation does not otherwise result in the elimination
or reduction of any “Section 411(d)(6) protected benefits” as
described in Section 8.1(e).

 

90

 

ARTICLE IX

TOP HEAVY PROVISIONS

 

9.1          TOP
HEAVY PLAN REQUIREMENTS

 

Notwithstanding anything in this Plan to the contrary, for any Top
Heavy Plan Year, the Plan shall provide the special vesting requirements of
Code Section 416(b) pursuant to Section 6.4 of the Plan and the
special minimum allocation requirements of Code Section 416(c) pursuant
to Section 4.3(f) of the Plan. 
Except as otherwise provided in the Plan, the minimum allocation shall
be an Employer Non-Elective Contribution and, if no vesting schedule has been
selected in the Adoption Agreement, shall be subject to the 6 year Graded
vesting schedule described in the adoption Agreement.

 

9.2          DETERMINATION
OF TOP HEAVY STATUS

 

(a)           This Plan shall be a Top Heavy Plan
for any plan year beginning after December 31, 1983, if any. of
the following conditions exists:

 

(1)           if
the “top heavy ratio” for this Plan exceeds sixty percent (60%) and this Plan
is not part of any “required aggregation group” or “permissive aggregation
group”;

 

(2)           if
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 group of plans
exceeds sixty percent (60%); or

 

(3)           if
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 sixty percent (60%).

 

(b)           “Top heavy ratio” means, with respect
to a determination date:

 

(1)           If
the Employer maintains one or more defined contribution plans (including any
simplified employee pension plan (as defined in Code Section 408(k)), and
the Employer has not maintained any defined benefit plan which during the
5-year period ending on the “determination date” has or has had accrued
benefits, the top heavy ratio for this plan alone or for the “required
aggregation group” 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” (including any part of any account
balance distributed in the 5-year period ending on the “determination date”),
and the denominator of which is the sum of all account balances (including any
part of any account balance distributed in the 5-year period ending on the “determination
date”), both computed in accordance with Code Section 416 and the
Regulations thereunder.  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.

 

91

 

(2)           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 5-year period ending on the “determination
date” has or has had any accrued benefits, the top heavy ratio for
any “required aggregation group” or “permissive aggregation group” as
appropriate is a fraction, the numerator of which is the sum of account
balances under the aggregated defined contribution plan or plans for all Key
Employees, determined in accordance with (1) 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,” 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 (1) above,
and the “present value” of accrued benefits under the defined
benefit plan or plans for all participants as of the “determination date,” 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 five-year period ending on the
determination date.

 

(3)           For
purposes of (1) and (2) 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 l2-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 5-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, 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).

 

92

 

(c)           “Determination date” means, 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, “determination date” means the last day of that Plan Year.

 

(d)           “Permissive aggregation group” means
the “required aggregation group” of plans plus any other plan or plans of the
Employer which, when considered as a group with the required aggregation group,
would continue to satisfy the requirements of Code Sections 401(a)(4) and
410.

 

(e)           “Present value” means the present
value based only on the interest and mortality rates specified in the Adoption
Agreement.

 

(f)            “Required aggregation group” means (1) each
qualified plan of the Employer in which at least one Key Employee participates
or participated at any time during the determination period (regardless of
whether the plan has terminated), and (2) any other qualified plan of the
Employer which enables a plan described in (1) to meet the requirements of
Code Sections 401(a)(4 ) or 410.

 

(g)           “Valuation date” means the date
elected by the Employer in the Adoption Agreement as of which account balances
or accrued benefits are valued for purposes of calculating the “top heavy ratio.”

 

ARTICLE X

MISCELLANEOUS

 

10.1        EMPLOYER
ADOPTIONS

 

(a)           Any
organization may become the Employer hereunder by executing the Adoption
Agreement in a form satisfactory to the Trustee, and it shall provide such
additional information as the Trustee may require.  The consent of the Trustee to act as such
shall be signified by its execution of the Adoption Agreement or a separate
agreement (including, if elected in the Adoption Agreement, a separate trust
agreement).

 

(b)           Except
as otherwise provided in this Plan, the affiliation of the Employer and the
participation of its Participants shall be separate and apart from that of any
other employer and its participants hereunder.

 

10.2        PARTICIPANT’S
RIGHTS

 

This Plan shall not be deemed to constitute a contract between the
Employer and any Participant or to be a consideration or an inducement for the
employment of any Participant or Employee. 
Nothing contained in this Plan shall be deemed to give any Participant
or Employee the right to be retained in the service of the Employer or to
interfere with the right of the Employer to discharge any Participant or
Employee at any time regardless of the effect which such discharge shall have
upon the Employee as a Participant of this Plan.

 

93

 

10.3          ALIENATION

 

(a)           Subject
to the exceptions provided below and as otherwise permitted by the Code and the
Act, no benefit which shall be payable to any person (including a Participant
or the Participant’s Beneficiary) shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, or
charge, and any attempt to anticipate, alienate, sell, transfer, assign,
pledge, encumber, or charge the same shall be void and no such benefit shall in
any manner be liable for, or subject to, the debts, contracts, liabilities,
engagements, or torts of any such person, nor shall it be subject to attachment
or legal process for or against such person, and the same shall not be
recognized except to such extent as may be required by law.

 

(b)             Subsection (a) shall not apply
to the extent a Participant or Beneficiary is indebted to the Plan by reason of
a loan made pursuant to Section 7.6. 
At the time distribution is to be made to or for a Participant’s or
Beneficiary’s benefit, such portion of the amount to be distributed as shall
equal such indebtedness shall be paid to the Plan, to apply against or
discharge such indebtedness.  Prior to
making a payment, however, the Participant or Beneficiary must be given notice
by the Administrator that such indebtedness is to be so paid in whole or part
from the Participant’s interest in the Plan. 
If the Participant or Beneficiary does not agree that the indebtedness
is a valid claim

 

against the Participant’s interest in the Plan, the Participant or
Beneficiary shall be entitled to a review of the validity of the claim in
accordance with procedures provided in Sections 2.10 and 2.11.

 

(c)           Subsection
(a) shall not apply to a “qualified domestic relations order” defined in Code
Section 414(p), and those other domestic relations orders permitted to be
so treated by the Administrator under the provisions of the Retirement Equity
Act of 1984.  The Administrator shall
establish a written procedure to determine the qualified status of domestic
relations orders and to administer distributions under such qualified
orders.  Further, to the extent provided
under a “qualified domestic relations order,” a former spouse of a Participant
shall he treated as the spouse or surviving spouse for all purposes under the
Plan.

 

(d)           Notwithstanding
any provision of this Section to the contrary, an offset to a Participant’s
accrued benefit against an amount that the Participant is ordered or 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, shall be permitted in
accordance with Code Sections 401(a)(13)(C) and (D).

 

10.4          CONSTRUCTION
OF PLAN

 

This Plan and Trust shall be construed and enforced according to the
Code, the Act and the laws of the state or commonwealth in which the Employees
(or if there is a corporate Trustee, the Trustee’s) principal office is located
(unless otherwise designated in the Adoption Agreement), other than its laws
respecting choice of law, to the extent not pre-empted by the Act.

 

94

 

10.5        GENDER
AND NUMBER

 

Wherever any words are used herein in the masculine, feminine or neuter
gender, they shall be construed as though they were also used in another gender
in all cases where they would so apply, and whenever any words are used herein
in the singular or plural form, they shall be construed as though they were
also used in the other form in all cases where they would so apply.

 

10.6        LEGAL
ACTION

 

In the event any claim, suit, or proceeding is brought regarding the
Trust and/or Plan established hereunder to which the Trustee, the Employer or
the Administrator may be party, and such claim, suit, or proceeding is resolved
in favor of the Trustee, the Employer or the Administrator, they shall be
entitled to be reimbursed from the Trust Fund for any and all costs, attorneys’
fees, and other expenses pertaining thereto incurred by them for which they
shall have become liable.

 

10.7        PROHIBITION
AGAINST DIVERSION OF FUNDS

 

(a)           Except as provided below and
otherwise specifically permitted by law, it shall be impossible by operation of
the Plan or of the Trust, by termination of either, by power of revocation or
amendment, by the happening of any contingency, by collateral arrangement or by
any other means, for any part of the corpus or income of any Trust Fund
maintained pursuant to the Plan or any funds contributed thereto to be used
for, or diverted to, purposes other than the exclusive benefit of Participants,
Former Participants, or their Beneficiaries.

 

(b)           In
the event the Employer shall make a contribution under a mistake of fact
pursuant to Act Section 403(c)(2)(A), the Employer may demand repayment of
such contribution at any time within one year following the time of payment and
the Trustee shall return such amount to the Employer within the one (1) year
period.  Earnings of the Plan
attributable to the contributions may not be returned to the Employer but any
losses attributable thereto must reduce the amount so returned.

 

(c)           Except
as specifically stated in the Plan, any contribution made by the Employer to
the Plan (if the Employer is not tax-exempt) is conditioned upon the
deductibility of the contribution by the Employer under the Code and, to the
extent any such deduction is disallowed, the Employer may, within one (1) year
following a final determination of the disallowance, whether by agreement with
the internal Revenue Service or by final decision of a court of competent
jurisdiction, demand repayment of such disallowed contribution and the Trustee
shall return such contribution within one (1) year following the
disallowance.  Earnings of the Plan
attributable to the contribution may not be returned to the Employer, but any
losses attributable thereto must reduce the amount so returned.

 

95

 

10.8        EMPLOYER’S
AND TRUSTEE’S PROTECTIVE CLAUSE

 

The Employer, Administrator and Trustee, and their successors, shall
not be responsible for the validity of any Contract issued hereunder or for the
failure on the part of the Insurer to make payments provided by any such
Contract, or for the action of any person which may delay payment or render a
Contract null and void or unenforceable in whole or in part.

 

10.9        INSURER’S
PROTECTIVE CLAUSE

 

Except as otherwise agreed upon in writing between the Employer and the
Insurer, an Insurer which issues any Contracts hereunder shall not have any
responsibility for the validity of this Plan or for the tax or legal aspects of
this Plan.  The Insurer shall be
protected and held harmless in acting in accordance with any written direction
of the Administrator or Trustee, and shall have no duty to see to the
application of any funds paid to the Trustee, nor be required to question any
actions directed by the Administrator or Trustee.  Regardless of any provision of this Plan, the
Insurer shall not be required to take or permit any action or allow any benefit
or privilege contrary to the terms of any Contract which it issues hereunder,
or the rules of the Insurer.

 

10.10      RECEIPT
AND RELEASE FOR PAYMENTS

 

Any payment to any Participant, the Participant’s legal representative,
Beneficiary, or to any guardian or committee appointed for such Participant or
Beneficiary in accordance with the provisions of this Plan, shall, to the
extent thereof, be in full satisfaction of all claims hereunder against the
Trustee and the Employer.

 

10.11      ACTION BY THE EMPLOYER

 

Whenever the Employer under the terms of the Plan is permitted or
required to do or perform any act or matter or thing, it shall be done and
performed by a person duly authorized by its legally constituted authority.

 

10.12      NAMED
FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY

 

The “Named Fiduciaries” of this Plan are (1) the Employer, (2) the
Administrator, (3) the Trustee (if the Trustee has discretionary authority
as elected in the Adoption Agreement or as otherwise agreed upon by the
Employer and the Trustee), and (4) any Investment Manager appointed
hereunder.  The named Fiduciaries shall
have only those specific powers, duties, responsibilities, and obligations as
are specifically given them under the Plan including, but not limited to, any
agreement allocating or delegating their responsibilities, the terms of which
are incorporated herein by reference.  In
general, the Employer shall have the sole responsibility for making the
contributions provided for under the Plan; and shall have the sole authority to
appoint and remove the Trustee and the Administrator; to formulate the Plan’s “funding
policy and method”; and to amend the elective provisions of the
Adoption Agreement or terminate, in whole or in part, the Plan.  The Administrator shall have the sole
responsibility for the administration of the Plan, which responsibility is
specifically described in the Plan.  If
the Trustee has

 

96

 

discretionary authority, it shall have the sole responsibility of
management of the assets held under the Trust, except those assets, the
management of which has been assigned to an Investment Manager or
Administrator, who shall be solely responsible for the management of the assets
assigned to it, all as specifically provided in the Plan.  Each named Fiduciary warrants that any
directions given, information furnished, or action taken by it shall be in accordance
with the provisions of the Plan, authorizing or providing for such direction,
information or action. Furthermore, each named Fiduciary may rely upon any such
direction, information or action of another named Fiduciary as being proper
under the Plan, and is not required under the Plan to inquire into the
propriety of any such direction, information or action.  It is intended under the Plan that each named
Fiduciary shall be responsible for the proper exercise of its own powers,
duties, responsibilities and obligations under the Plan.  No named Fiduciary shall guarantee the Trust
Fund in any manner against investment loss or depreciation in asset value.  Any person or group may serve in more than
one Fiduciary capacity.

 

10.13       HEADINGS

 

The headings and subheadings of this Plan have been inserted for
convenience of reference and are to be ignored in any construction of the
provisions hereof.

 

10.14      APPROVAL BY INTERNAL REVENUE SERVICE

 

Notwithstanding anything herein to the contrary, if, pursuant to a
timely application filed by or on behalf of the Plan, the Commissioner of the
Internal Revenue Service or the Commissioner’s delegate should determine that
the Plan does not initially qualify as a tax-exempt plan under Code Sections
401 and 501, and such determination is not contested, or if contested, is
finally upheld, then if the Plan is a new plan, it shall be void ab initio and
all amounts contributed to the Plan, by the Employer, less expenses paid, shall
be returned within one (1) year and the Plain shall terminate, and the
Trustee shall be discharged from all further obligations.  If the disqualification relates to a Plan
amendment, then the Plan shall operate as if it had not been amended.  If the Employer’s Plan fails to attain or
retain qualification, such Plan will no longer participate in this prototype
plan and will be considered an individually designed plan.

 

10.15      UNIFORMITY

 

All provisions of this Plan shall be interpreted and applied in a
uniform, nondiscriminatory manner.

 

10.16      PAYMENT
OF BENEFITS

 

Except as otherwise provided in the Plan, benefits under this Plan
shall be paid, subject to Sections 6.10, 6.11 and 12.9, only upon death, Total
and Permanent Disability, normal or early retirement, termination of
employment, or termination of the Plan.

 

97

 

ARTICLE XI

PARTICIPATING EMPLOYERS

 

11.1        ELECTION
TO BECOME PARTICIPATING EMPLOYER

 

Notwithstanding anything herein to the contrary, with the consent of
the Employer and Trustee, any Affiliated Employer may adopt the Employer’s
Plan and all of the provisions hereof, and participate herein and be known as a
Participating Employer, by a properly executed document evidencing said intent
and will of such Participating Employer. 
Regardless of the preceding, an entity that ceases to be an Affiliated
Employer may continue to be a Participating Employer through the end of the
transition period for certain dispositions set forth in Code Section 410(b)(6)(C
).  In the event a Participating Employer
is not in Affiliated Employer and the transition period in the preceding
sentence, if applicable, has expired, then this Plan will be considered an
individually designed plan.

 

11.2        REQUIREMENTS
OF PARTICIPATING EMPLOYERS

 

(a)           Each Participating Employer shall be required to select
the same Adoption Agreement provisions as those selected by the Employer other
than the Plan Year, the Fiscal Year, and such other items that must, by
necessity, vary among employers.

 

(b)           The Trustee may, but shall not be required to, commingle,
hold and invest as one Trust Fund all contributions made by Participating
Employers, as well as all increments thereof. 
However, the assets of the Plan shall, on an ongoing basis, be available
to pay benefits to all Participants and Beneficiaries under the Plan without
regard to the Employer or Participating Employer who contributed such assets.

 

(c)           Unless the Employer otherwise directs, any expenses of the
Plan which are to be paid by the Employer or borne by the Trust Fund shall be
paid by each Participating Employer in the same proportion that the total
amount standing to the credit of all such Employer bears to the total standing
to the credit of all Participants.

 

11.3        DESIGNATION
OF AGENT

 

Each Participating Employer shall be deemed to be a part of this Plan;
provided, however, that with respect to all of its relations with the Trustee
and Administrator for purposes of this Plan, each Participating Employer shall
be deemed to have designated irrevocably the Employer as its agent.  Unless the context of the Plan clearly
indicates otherwise, the word “Employer” shall be deemed to include each
Participating Employer as related to its adoption of the Plan.

 

11.4        EMPLOYEE
TRANSFERS

 

In the event an Employee is transferred between Participating
Employers, accumulated service and eligibility shall be carried with the
Employee involved.  No such transfer
shall effect a termination of employment hereunder, and the Participating
Employer to which the Employee is transferred shall thereupon become obligated
hereunder with respect to such Employee in the same manner as was the
Participating Employer from whom the Employee was transferred.

 

98

 

11.5        PARTICIPATING
EMPLOYER’S CONTRIBUTION AND FORFEITURES

 

Any contribution or Forfeiture subject to allocation during each Plan
Year shall be allocated among all Participants of all Participating Employers
in accordance with the provisions of this Plan. 
However, if a Participating Employer is not an Affiliated Employer (due
to the transition title for certain dispositions set forth in Code Section 410(b)(6)(C))
then any contributions made by such Participating Employer will only be
allocated among the Participants eligible to share of the Participating
Employer.  On the basis of the
information furnished by the Administrator, the Trustee may keep separate books
and records concerning the affairs of each Participating Employer hereunder and
as to the accounts and credits of the Employees of each Participating
Employer.  The Trustee may, but need not,
register Contracts so as to evidence that a particular Participating Employer
is the interested Employer hereunder, but in the event of an Employee transfer
from one Participating Employer to another, the employing Participating
Employer shall immediately notify the Trustee thereof.

 

11.6        AMENDMENT

 

Amendment of this Plan by the Employer at any time when there shall be
a Participating Employer that is an Affiliated Employer hereunder shall only be
by the written action of each and every Participating Employer and with the
consent of the Trustee where such consent is necessary in accordance with the
terms of this Plan.

 

11.7        DISCONTINUANCE
OF PARTICIPATION

 

Except in the case of a standardized Plan, any Participating Employer
that is an Affiliated Employer shall be permitted to discontinue or revoke its
participation in the Plan at any time. 
At the time of any such discontinuance or revocation, satisfactory
evidence thereof and of any applicable conditions imposed shall be delivered to
the Trustee.  The Trustee shall
thereafter transfer, deliver and assign Contracts and other Trust Fund assets
allocable to the Participants of such Participating Employer to such new.
trustee or custodian as shall have been designated by such Participating
Employer, in the event that it has established a separate qualified retirement
plan for its employees provided, however, that no such transfer shall be made
if the result is the elimination or reduction of any “Section 411(d)(6) protected
benefits” as described in Section 8.1(e). 
If no successor is designated, the Trustee shall retain such assets for
the Employees of said Participating Employer pursuant to the provisions of Article VII
hereof.  In no such event shall any part
of the corpus or income of the Trust Fund as it relates to such Participating
Employer be used for or diverted to purposes other than for the exclusive
benefit of the employees of such Participating Employer.

 

99

 

11.8        ADMINISTRATOR’S
AUTHORITY

 

The Administrator shall have authority to make any and all necessary rules or
regulations, binding upon all Participating Employers and all Participants, to
effectuate the purpose of this article.

 

11.9        PARTICIPATING
EMPLOYER CONTRIBUTION FOR AFFILIATE

 

If any Participating Employer is prevented in whole or in part from
making a contribution which it would otherwise have made under the Plan by
reason of having no current or accumulated earnings or profits, or because such
earnings or profits are less than the contribution which it would otherwise
have made, then, pursuant to Code Section 404(a)(3)(B), so much of the
contribution which such Participating Employer was so prevented from making may
be made, for the benefit of the participating employees of such Participating
Employer, by other Participating Employers who are members of the same
affiliated group within the meaning of Code Section 1504 to the extent of
their current or accumulated earnings or profits, except that such contribution
by each such other Participating Employer shall be limited to the proportion of
its total current and accumulated earnings or profits remaining after
adjustment for its contribution to the Plan made without regard to this
paragraph which the total prevented contribution bears to the total current and
accumulated earnings or profits of all the Participating Employers remaining
after adjustment for all contributions made to the Plan without regard to this
paragraph.

 

A Participating Employer on behalf of whose employees a contribution is
made under this paragraph shall not be required to reimburse the contributing
Participating Employers.

 

ARTICLE XII

CASH OR DEFERRED PROVISIONS

 

Except as specifically provided elsewhere in this Plan, the provisions
of this Article shall apply with respect to any .401(k) Profit
Sharing Plan regardless of any provisions in the Plan to the contrary.

 

12.1        FORMULA
FOR DETERMINING EMPLOYER’S CONTRIBUTION

 

(a)           For each Plan Year, the Employer will (or may with respect
to any discretionary contributions) contribute to the Plan:

 

(1)           The
amount of the total salary reduction elections of all Participants made
pursuant to Section 12.2(a), which amount shall be deemed Elective
Deferrals, plus

 

(2)           If
elected in the Adoption Agreement, a matching contribution equal to the percentage,
if any, specified in the Adoption Agreement of the Elective Deferrals of each
Participant eligible to share in the allocations of the matching contribution,
which amount shall be deemed an Employer’s matching contribution or Qualified
Matching Contribution as elected in the Adoption Agreement, plus

 

100

 

(3)           If
elected in the Adoption Agreement, a Prevailing Wage Contribution or a
discretionary amount determined each year by the Employer, which amount it any,
shall be deemed an Employer’s Non-Elective Contribution, plus

 

(4)           If elected in the Adoption Agreement, at Qualified
Non-Elective Contribution.

 

(b)           Notwithstanding the foregoing, if the Employer is not a
tax-exempt entity, then the Employer’s contributions for any Fiscal Year may
generally not exceed the maximum amount allowable as a deduction to the
Employer under the provisions of Code Section 404.  However, to the extent necessary to provide
the top heavy minimum allocations, the Employer shall make a contribution even
if it exceeds current or accumulated Net Profit or the amount that is
deductible under Code Section 404. 
All contributions by the Employer shall be made in cash or in such
property as is acceptable to the Trustee.

 

12.2        PARTICIPANT’S
SALARY REDUCTION LECTION

 

(a)           Each Participant may elect to defer a portion of
Compensation which would have been received in the Plan Year, but for the
salary reduction election, subject to the limitations of this Section and
the Adoption Agreement.  A salary
reduction election (or modification of an earlier election) may not be made
with respect to Compensation which is currently available on or before the date
the Participant executed such election, or if later, the later of the date the
Employer adopts this cash or deferred arrangement or the date such arrangement
first became effective.  Any elections
made pursuant to this Section shall become effective as soon as is
administratively feasible.  If the
automatic election option is elected in the Adoption Agreement, then in the
event a Participant fails to make a deferral election and does not
affirmatively elect to receive cash, such Participant Shall be deemed to have
made a deferral election equal to the percentage of Compensation set forth in
the Adoption Agreement.  The automatic
election may, in accordance with procedures established by the Administrator,
be applied to all Participants or to Eligible Employees who become Participants
after a certain date.  For purposes of
this Section, the annual dollar limitation of Code Section 401(a)(7) ($150,000
as adjusted) shall not apply.

 

Additionally, if elected in the Adoption
Agreement, each Participant may elect to defer a different percentage or amount
of any cash bonus to be paid by the Employer during the Plan Year deferral
election may not be made with respect to cash bonuses which are currently
available on or before the date the Participant executes such election.

 

The amount by which Compensation and/or cash
bonuses are reduced shall be that Participant’s Elective Deferrals and shall be
treated as an Employer contribution and allocated to that Participants Elective
Deferral Account.

 

101

 

Once made, a Participants election to reduce
Compensation shall remain in effect until modified or terminated.  Modifications may be made as specified in the
Adoption Agreement, and terminations may be made at any time.  Any modification or termination of an
election will become effective as soon as is administratively feasible.

 

(b)           The balance in each Participant’s Elective Deferral
Account, Qualified Matching Contribution Account and Qualified Non-Elective
Contribution Account shall be fully Vested at all times and, except as
otherwise provided herein, shall not be subject to Forfeiture for any reason.

 

(c)           Amounts held in a Participant’s Elective Deferral Account,
Qualified Matching Contribution Account and Qualified Non-Elective Account may
only be distributable as provided in (4), (5 ) or (6) below or as provided
under the other provisions of this Plan, but in no event prior to the earlier
of the following events or any other events permitted by the Code or
Regulations:

 

(1)           the
Participant’s separation from service, Total and Permanent Disability, or
death;

 

(2)           the
Participant’s attainment of age 591⁄2;

 

(3)           the
proven financial hardship of the Participant, subject to the limitations of Section 12.9;

 

(4)           the
termination of the Plan without the existence at the time of Plan termination
of another defined contribution plan or the establishment of a successor
defined contribution plan by the Employer or an Affiliated Employer within the
period ending twelve months after distribution of all assets from the Plan
maintained by the Employer.  For this
purpose, a defined contribution does not include an employee stock ownership
plan (as defined in Code Section 4975(e)(7) or 409), a simplified
employee pension plan (as defined Code Section 403(k)), or a SIMPLE
individual retirement account plan (as defined in Code Section 408(p));

 

(5)           the
date of the sale by the Employer to an entity that is not an Affiliated
Employer of substantially all of the assets (within the meaning of Code Section 409(d)(2))
with respect to a Participant who continues employment with the corporation acquiring
such asset; or

 

(6)           the
date of the sale by the Employer or an Affiliated Employer of its interest in a
subsidiary (within the meaning of Code Section 409(d)(3)) to an entity
that not an Affiliated Employer with respect to a Participant who continues
employment with such subsidiary.

 

Distributions that are made because of (4), (5) or
(6) above must be made in as lump-sum.

 

102

 

(d)           A Participant’s “elective deferrals” made under this Plan
and all other plans, contracts or arrangements of the Employer maintaining the
Plan during any calendar year shall not exceed the dollar limitation imposed by
Code Section 402(g), as in effect at the beginning of such calendar
year.  This dollar limitation shall be adjusted
annually pursuant to the method provided in Code Section 415(d) in
accordance with Regulations.  For this
purpose, “elective deferrals” means, with respect to a calendar year, 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 as described
in Code Section 401(k), any salary reduction simplified employee pension
(as defined in Code Section 408(k)(6)), any SIMPLE IRA plan described in
Code 

Section 408(p), any eligible deferred compensation plan under Code Section 457,
any plans described under Code Section 501(c)(18), and any Employer
contributions made on the behalf of a Participant for the purchase of an
annuity contract under Code Section 403(b) pursuant to a salary
reduction agreement.  “Elective deferrals”
shall not include any deferrals properly distributed as excess “Annual
Additions” pursuant to Section 4.5.

 

(e)           If a Participant has Excess Deferrals for a taxable year,
the Participant may, not later than March 1st following the close of such
taxable year, notify the Administrator in writing of such excess and request
that the Participant’s Elective Deferrals under this Plan be reduced by an
amount specified by the Participant.  In
such event, the Administrator shall direct the distribution of such excess
amount (and any “Income” allocable to such excess amount) to the Participant
not later than the first April 15th following the close of the Participant’s
taxable year.  Any distribution of less
than the entire amount of Excess Deferrals and “Income” shall be treated as a
pro rata distribution of Excess Deferrals and “Income.”  The amount distributed shall not exceed the
Participant’s Elective Deferrals under the Plan for the taxable year.  Any distribution on or before the last day of
the Participant’s taxable year must satisfy each of the following conditions:

 

(1)           the
Participant shall designate the distribution as Excess Deferrals;

 

(2)           the
distribution must be made after the date on which the Plan received the Excess
Deferrals; and

 

(3)           the
Plan must designate the distribution as a distribution of Excess Deferrals.

 

Regardless of the preceding, if a Participant has Excess Deferrals
solely from elective deferrals made under this Plan or any other plan
maintained by the Employer, a Participant will be deemed to have notified the
Administrator of such excess amount and the Administrator shall direct the
distribution of such Excess Deferrals in a manner consistent with the
provisions of this subsection.

 

103

 

Any distribution made pursuant to this subsection shall be made first
from unmatched Elective Deferrals and, thereafter, from Elective Deferrals
which are matched.  Matching
contributions which relate to Excess Deferrals that are distributed pursuant to
this Section 12.2(e) shall be treated as a Forfeiture to the extent
required pursuant to Code Section 401(a)(4) and the Regulations
thereunder.

 

For the purpose of this subsection, “Income” means the amount of income
or loss allocable to a Participant’s Excess Deferrals, which amount shall be
allocated in the same manner as income or losses are allocated pursuant to Section 4.3(c).  However, “Income” for the period between the
end of the taxable year of the Participant and the date of the distribution
(the “gap period”) is not required to be distributed.

 

(f)            Notwithstanding the preceding, a Participant’s Excess
Deferrals shall be reduced, but not below zero, by any distribution and/or
recharacterization of Excess Deferrals pursuant to Section 12.5(a) for
the Plan Year beginning with or within the taxable yea of the Participant.

 

(g)           In the event a Participant has received a hardship
distribution pursuant to Regulation 1.401(k)-1(d)(2)(iii)(B) from any
other plan maintained by the Employer or from the Participant’s Elective
Deferral Account pursuant to Section 12.9, then such Participant shall not
be permitted to elect to have Elective Deferrals contributed to the Plan for a
period of twelve (12) months following the receipt of the distribution.  Furthermore, the dollar limitation under Code
Section 402(g) shall be reduced, with respect to the Participants
taxable year following the taxable year in which the hardship distribution was
made, by the amount of such Participant’s Elective Deferrals, if any, made
pursuant to this Plan (and any other plan maintained by the Employer) for the
taxable year of the hardship distribution.

 

(h)           At Normal Retirement Date, or such other date when the
Participant shall be entitled to receive benefits, the fair market value of the
Participant’s Elective Deferral Account shall be used to provide benefits to
the Participant or the Participant’s Beneficiary.

 

(i)            If during a Plan Year, it is projected that the aggregate
amount of Elective Deferrals to be allocated to all Highly Compensated
Participants under this Plan would cause the Plan to fail the tests set forth
in Section 12.4, then the Administrator may automatically reduce the
deferral amount of affected Highly Compensated Participants, beginning with the
Highly Compensated Participant who has the highest actual deferral ratio until
it is anticipated the Plan will pass the tests or until the actual deferral
ratio equals the actual deferral ratio of the Highly Compensated Participant
having the next highest actual deferral ratio. 
This process may continue until it is anticipated that the Plan will
satisfy one of the tests set forth Section 12.4.  Alternatively, the Employer may specify a
maximum percentage of Compensation that may be deferred by Highly Compensated
Participants:

 

(j)            The Employer and the Administrator shall establish
procedures necessary to implement the salary reduction elections provided for
herein.  Such procedures may

 

104

 

contain limits on salary deferral elections
such as limiting elections to whole percentages of Compensation or to equal
dollar amounts per pay period that an election is in effect.

 

12.3        ALLOCATION
OF CONTRIBUTION. FORFEITURES AND EARNINGS

 

(a)           The Administrator shall establish and maintain account in
the name of each Participant to which the Administrator shall credit as of each
Anniversary Date, or other Valuation Date, all amounts allocated to each such
Participant as set forth herein.

 

(b)           The Employer shall provide the Administrator with all
information required by the Administrator to make a proper allocation of
Employer contributions for each Plan Year. 
Within a reasonable period of time after the date of receipt by the
Administrator of such information, the Administrator shall allocate
contributions as follows:

 

(1)           With
respect to Elective Deferrals made pursuant to Section 12.1(a)(1), to each
Participant’s Elective Deferral Account in an amount equal to each such
Participant’s Elective Deferrals for the year.

 

(2)           With
respect to the Employees matching contribution made pursuant to Section 12.1(a)(2),
to each Participant’s Account, or Participant’s Qualified Matching Contribution
Account, as elected in the Adoption Agreement, in accordance with Section 12.1(a)(2).

 

Except, however, in order to be entitled to receive any Employer
matching contribution, a Participant must satisfy the conditions for sharing in
the Employer matching contribution as set forth in the Adoption Agreement.  Furthermore, regardless of any election in
the Adoption Agreement to the contrary, for the Plan Year in which this Plan
terminates, a Participant shall only be eligible to share in the allocation of
the Employer’s contributions for the Plan Year if the Participant is employed
at the end of the Plan Year and has completed to Year of Service (or Period of
Service if the Elapsed Time Method is elected).

 

(3)           With
respect to the Employees Non-Elective Contribution made pursuant to Section 12.1(a)(3),
to each Participant’s Account in accordance with the provisions of Section 4.3(b)(2)or
(3) whichever is applicable.

 

(4)           With
respect to the Employees Qualified Non-Elective Contribution made pursuant to Section 12,1(11)(4).
to each Participant’s (excluding Highly Compensated Employees. if elected in
the Adoption Agreement) Qualified Non-Elective Contribution Account in
accordance with the Adoption Agreement.

 

(c)           Notwithstanding anything in the Plan to the contrary, in
determining whether a Non-Key Employee has received the required minimum
allocation pursuant to Section 4.3(f) such Non-Key Employee’s
Elective Deferrals and matching contributions used to satisfy the ADP tests in Section 12.4
or the ACP tests in Section 12.6 shall not be taken into account.

 

105

 

(d)           Notwithstanding
anything herein to the contrary, Participants who terminated employment during
the Plan Year shall share in the salary deferral contributions made by the
Employer for the year of termination without regard to the Hours of Service
credited.

 

(e)           Notwithstanding
anything herein to the contrary (other than Sections 4.3(f) and 12.3(f)),
Participants shall only share in the allocations of the Employer’s matching
contribution made pursuant to Section 12.1(a)(2), the Employer’s Non-Elective
Contributions made pursuant to Section 12.1(a)(3), the Employer’s Qualified
Non-Elective Contribution made pursuant to Section 12.1(a)(4), and Forfeitures
as provided in the Adoption Agreement. 
If no election is made in the Adoption Agreement, then a Participant
shall be eligible to share in the allocation of the Employer’s contribution for
the year if the Participant completes more than 500 Hours of Service (for three
(3) Months of Service if the Elapsed Time method is chosen in the Adoption
Agreement) during the Plan Year or who is employed on the last day of the Plan
Year.  Furthermore, regardless of any
election in the Adoption Agreement to the contrary, for the Plan Year in which
this Plan terminates, a Participant shall only be eligible to share in the
allocation of the Employer’s contributions for the Plan Year if the Participant
is employed at the end of the Plan Year and has completed a Year of Service (or
Period of Service if the Elapsed Time Method is elected).

 

(f)            Notwithstanding, anything in this Section to the
contrary, the provisions of this subsection apply for any Plan Year if, in the
non-standardized Adoption Agreement the Employer elected to apply the 410(b) ratio
percentage failsafe provisions and the plan fails to satisfy the “ratio
percentage test” due to a last day of the Plan Year allocation condition or an “Hours
of Service” (or months of service) allocation condition.  A plan satisfies the “ratio percentage test”
if on the last day of the Plan Year, the “benefiting ratio” of the Non-Highly
Compensated Employees who are “includible” is at least 70% of the “benefiting
ratio” of the Highly Compensated Employees who are “includible.”  The “benefiting ratio” of the Non-Highly
Compensated Employees is the number of “includible” Non-Highly “benefiting”
under the Plan divided by the number of “includible” Employees who are
Non-Highly Compensated Employees.  The “benefiting
ratio” of the Highly Compensated Employees is the number of Highly Compensated
Employees “benefiting” under the Plan divided by the number of “includible”
Highly Compensated Employees.  “Includible”
Employees are all Employees other than:  (1) those
Employees excluded from participating in the plan for the entire Plan Year by
reason of the collective bargaining unit exclusion or the nonresident alien
exclusion described in the Code or by reason of the age and service
requirements of Article III: and (2) any Employee who incurs a
separation from service during the Plan Year and fails to complete at least 501
Hours of Service (or three (3) months of service if the Elapsed Time
Method is being used) during such Plan Year.

 

For purposes of this subsection, an Employee
is “benefiting” under the Plan on a particular date if, under the Plan, the
Employee is entitled to an Employer contribution or an allocation of
Forfeitures for the Plan Year.

 

106

 

If this subsection applies, then the
Administrator will suspend the allocation conditions for the “includible”
Non-Highly Compensated Employees who are Participants, beginning first with the
“includible” Employees employed by the Employer on the last day of the Plan
Year, then the “includible” Employees who have the latest separation from
service during the Plan Year, and continuing to suspend the allocation
conditions for each “includible” Employee who incurred an earlier separation
from service, from the latest to the earliest separation from service date,
until the Plan satisfies the “ratio percentage test” for the Plan Year.  If two or more “includible” Employees have a
separation from service on the same day, then the Administrator will suspend
the allocation conditions for all such “includible” Employees, irrespective of
whether the Plan can satisfy the “ratio percentage test” by accruing benefits
for fewer than all such “includible” Employees. 
If the Plan for any Plan Year suspends the allocation conditions for an “includible”
Employee, then that Employee will share in the allocation for that Plan Year of
the Employer contribution and Forfeitures, if any, without regard to whether
the Employee has satisfied the other allocation conditions set forth in this
Section.

 

If the Plan includes Employer snatching contributions subject to ACP
testing this subsection applies separately to the Code Section 401(m) portion
of the Plan.

 

12.4        ACTUAL
DEFERRAL PERCENTAGE TESTS

 

(a)           Except as otherwise provided herein, this subsection
applies if the Prior Year Testing method is elected in the Adoption
Agreement.  The “Actual Deferral
Percentage” (hereinafter “ADP”) for a Plan Year for Participants who are Highly
Compensated Employees thereinafter “HCEs”) for each Plan Year and the prior
year’s ADP for Participants who were Non-Highly Compensated Employees
(hereinafter “NHCEs”) for the prior Plan Year must satisfy one of the following
tests:

 

(1)           The
ADP for to Plan Year for Participants who are HCEs for the Plan Year shall snot
exceed the prior year’s ADP for Participants who were NHCEs for the prior Plan
Year multiplied by 1.25; or

 

(2)           The
ADP for a Plan Year for Participants who are HCEs for the Plan Year shall not
exceed the prior year’s ADP for Participants who were NHCEs for the prior Plan
Year multiplied by 2.0 provided, that the ADP for Participants who are HCEs does
not exceed the prior year’s ADP for Participants who were NHCEs in the prior
Plan Year by more than two (2) percentage points.

 

Notwithstanding the above, for purposes of applying the foregoing tests
with respect to the first Plan Year in which the Plan permits any Participant
to make Elective Deferrals, the ADP for the prior year’s NHCEs shall be deemed
to be three percent (3%) unless the Employer has elected in the Adoption
Agreement to use the current Plan Year’s ADP for these Participants.  However, the provisions of this paragraph may
not be used if the Plan is a successor plan or is otherwise prohibited from
using such provisions pursuant to IRS Notice 98-1 (or superseding guidance).

 

107

 

(b)           Notwithstanding the foregoing, if the Current Year Testing
method is elected in the Adoption Agreement, the ADP tests in (a)(1), above
shall be applied by comparing the current Plan Year’s ADP for Participants who
are HCEs with the current Plan Year’s ADP (rather than the prior Plan Year’s
ADP) for Participants who are NHCEs for the current Plan Year.  Once made, this election can only be changed
if the Plan meets the requirements for changing to the Prior Year Testing
method set forth in IRS Notice 98-1 (or superseding guidance).  Furthermore, this Plan must use the same
testing method for both the ADP and ACP tests for Plan Years beginning on or
after the date the Employer adopts its GUST restated plan.

 

(c)           This subsection applies to prevent the multiple use of the
test set forth in subsection (a)(2) above. 
Any HCE eligible to make Elective Deferrals pursuant to Section 12.2
and to make after-tax voluntary Employee contributions or to receive matching
contributions under this Plan or under any other plan maintained by the
Employer or an Affiliated Employer, shall have either the actual deferral ratio
adjusted in the manner described in Section 12.5 or the actual
contribution ratio adjusted in the manner described in Section 12.7 so
that the “Aggregate Limit” is not exceeded pursuant to Regulation
1.401(m)-2.  The amounts in excess of the
“Aggregate Limit” shall be treated as either an Excess Contribution
or in Excess Aggregate Contribution.  The
ADP and ACP of the HCEs are determined after any corrections required to meet
the ADP and ACP tests and are deemed to be the maximum permitted under such
tests for the Plan Year.  Multiple use
does not occur if either the ADP or ACP of the HCEs does not exceed 1.25
multiplied by the ADP and ACP of the NHCEs.

 

“Aggregate Limit” means the sum of (i) 125 percent of the greater
of the ADP of the NHCEs for the prior Plan Year or the ACP of such NHCEs under
the plan subject to Code Section 401(m) for the Plan Year beginning
with or within the prior Plan Year of the cash or deferred arrangement and (ii) the
lesser of 200% or two (2) plus the lesser of such ADP or ACP.  “Lesser” is substituted for “greater”
in (i) above, and “greater” is substituted for “lesser” after “two (2) plus
the” in (ii) above if it would result in a larger Aggregate
Limit.  If the Employer has elected in
the Adoption Agreement to use the Current Year Testing method, then in
calculating the “Aggregate Limit” for a particular Plan Year, the NHCEs ADP and
ACP for that Plan Year, instead of the prior Plan Year, is used.

 

(d)           A Participant is an HCE for a particular Plan Year if the
Participant meets the definition of an HCE in effect for that Plan Year.  Similarly, a Participant is an NHCE for a
particular Plan Year the Participant does not meet the definition of an HCE in
effect for that Plan Year.

 

(e)           For the purposes of this Section and Section 12.5
ADP means, for a specific group of Participants for a Plan Year, the average of
the ratios (calculated separately for each Participant in such group) of (1) the
amount of Employer contributions actually paid over to the Plan on behalf of
such Participant for the Plan Year to (2) the

 

108

 

Participant’s 414(s) Compensation for
such Plan Year.  Employer contributions
on behalf of any participant shall include: 
(1) any Elective Deferrals made pursuant to the Participant’s
deferral election (including Excess Deferrals of HCEs), but excluding (i) Excess
Deferrals of NHCEs that arise solely from Elective Deferrals made under the
plan or plans of this Employer and (ii) Elective Deferrals that are taken
into account in the ACP tests set forth in Section 12.6 (provided the ADP
test is satisfied both with and without exclusion of these Elective Deferrals):
and (2) at the election of the Employer, Qualified Non-Elective
Contributions and Qualified Matching Contributions to the extent such
contributions are not used to satisfy the ACP test.

 

The actual deferral ratio for each
Participant and the ADP for each group shall be calculated to the nearest
one-hundredth of one percent.  Elective
Deferrals allocated to each Highly Compensated Participant’s Elective Deferral
Account shall not be reduced by Excess Deferrals to the extent such excess
amounts are made under this Plan or any other plan maintained by the Employer.

 

(f)            For purposes of this Section and Section 12.5,
a Highly Compensated Participant and a Non-Highly Compensated Participant shall
include any Employee eligible to make salary deferrals pursuant to Section 12.2
for the Plan Year.  Such Participants who
fail to make Elective Deferrals shall be treated for ADP purposes as
Participants on whose behalf no Elective Deferrals are made.

 

(g)           In the event this Plan satisfies the requirements of Code
Sections 401(a)(4), 401(k), or 410(b) only if aggregated with one or more
other plans, or if one or more other plans satisfy the requirements of such
sections of the Code only if aggregated with this Plan, then this Section shall
be applied by determining the ADP of Employees as if all such plans were a
single plan.  Any adjustments to the NHCE
ADP for the prior year will be made in accordance with IRS Notice 98-1 and any
superseding guidance, unless the Employer has elected in the Adoption Agreement
to use the Current 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 ADP testing method.

 

(h)           The ADP for any Participant who is an HCE for the Plan
Year and who is eligible to have Elective Deferrals (and Qualified Non-Elective
Contributions or Qualified Matching Contributions, or both, if treated as
Elective Deferrals for purposes of the ADP test) allocated to such Participant’s
accounts under two ( 2) or more arrangements described in Code Section 40.1(k),
that are maintained by the Employer, shall be determined as if such Elective
Deferrals (and, if applicable, such Qualified Non-Elective Contributions or
Qualified Matching Contributions, or both) were made under a single arrangement
for purposes of determining such HCE’s actual deferral ratio.  However, if the cash or deferred arrangements
have different Plan Years, this paragraph shall be applied by treating all cash
or deferred arrangements ending with or within the same calendar year
arrangement.  Notwithstanding the
foregoing, certain plans shall be treated as separate if mandatorily
disaggregated under Regulations under Code Section 401.

 

109

 

(i)            For
purposes of determining the ADP and the amount of Excess Contributions pursuant
to Section 12.5, only Elective Deferrals, Qualified Non-Elective
Contributions and Qualified Matching Contributions contributed to the Plan
prior to the end of the twelve (12) month period immediately following the Plan
Year to which the contributions relate shall be considered.

 

(j)            Notwithstanding
anything in this Section to the contrary, the provisions of this Section and
Section 12.5 may be applied separately (or will be applied separately to
the extent required by Regulations) to each “plan” within the meaning of
Regulation 1.407(k)-1(g)(11). 
Furthermore, for Plan Years beginning after December 31, 1998, the
provisions of Code Section 401(k)(3)(F) may be used to exclude from
consideration all Non-Highly Compensated Employee s who have not satisfied the
minimum age and service requirements of Code Section 410(a)(1)(A)

 

12.5        ADJUSTMENT
TO ACTUAL DEFERRAL PERCENTAGE TESTS

 

(a)           In
the event (or, with respect to subsection (c) when the Prior Year Testing
method is being used, if it is anticipated) that for Plan Years beginning after
December 31, 1996, the Plan does not satisfy one of the tests set fort-h Section 12.4,
the Administrator shall adjust Excess Contributions or the Employer shall make
contributions pursuant to the options set forth below of any combination
thereof.  However, if the Prior Year
testing method is being used and it is anticipated that the Plan might not
satisfy one of such tests, then the Employer may make contributions pursuant to
the options set forth in subsection (c) below.

 

(b)           On
or before the fifteenth day of the third month following the end of each Plan
Year, but in no event later than the close of the following Plan Year, the
Highly Compensated Participant allocated the largest amount of Elective Deferrals
shall have a portion of such Elective Deferrals (and “Income” allocable to such
amounts) distributed and/or, at the Participant’s election, recharacterized as
a after-tax voluntary Employee contribution pursuant to Section 4.8) until
the total amount of Excess Contributions has been distributed, or until the
amount of the Participant’s Elective Deferrals equals the Elective Deferrals of
the Highly Compensated Participant having the next largest amount of Elective
Deferrals allocated.  This process shall
continue until the total amount of Excess Contributions has been
distributed.  Any distribution and/or
recharacterization of Excess Contributions shall be made in the following
order:

 

(1)           With
respect to the distribution of Excess Contributions such distribution:

 

(i)            may
be postponed but not later than the close of the Plan Year following the Plan
Year to which they are allocable;

 

(ii)           shall
be made first from unmatched Elective Deferrals and, thereafter, simultaneously
from Elective Deferrals which are matched and matching contributions which
relate to such Elective Deferrals. 
Matching contributions which relate to Excess Contributions shall be
forfeited unless the related matching contribution is distributed as an Excess
Aggregate Contribution pursuant to Section 12.7;

 

110

 

(iii)          shall
be adjusted “Income”; and

 

(iv)          shall
be designated by the Employer as a distribution of Excess Contributions (and “Income”).

 

(2)           With
respect to the recharacterization of Excess Contributions pursuant to (a) above,
such recharacterized amounts;

 

(i)            shall
be deemed to have occurred on the date on which the last of those Highly
Compensated Participants with Excess Contributions to be recharacterized is
notified of the recharacterization and the tax consequences of such
recharacterization;

 

(ii)           shall
not exceed the amount of Elective Deferrals on behalf of any Highly Compensated
Participant for any Plan Year;

 

(iii)          shall
be treated as after-tax voluntary Employee contributions for purposes of Code Section 401(a)(4) and
Regulation 1.401(k)-1(b).  However, for
purposes of Sections 4.3(f) and 9.2 (top heavy rules), recharacterized
Excess Contributions continue to be treated as Employer contributions that are
Elective Deferrals.  Excess Contributions
(and “Income” attributable to such accounts) recharacterized as after-tax
voluntary Employee contributions shall continue to be nonforfeitable and
subject to the same distribution rules provided for in Section 12.2(c);
and

 

(iv)          are
not permitted if the amount recharacterized plus after-tax voluntary Employee
contributions actually made by such Highly Compensated Participant, exceed the
maximum amount of after-tax voluntary Employee contributions (determined prior
to application of Section 12.6) that such Highly Compensated Participant
is permitted to make under the Plan in the absence of recharacterization.

 

(3)           Any
distribution and/or recharacterization of less than the entire amount of Excess
Contributions shall be treated as a pro rata distribution and/or
recharacterization of Excess Contributions and “Income.”

 

(4)           For
the purpose of this Section, “Income” means the income or losses allocable to
Excess Contributions, which amount shall be allocated at the same time and in
the same manner as income or losses are allocated pursuant to Section 4.3(c).  However, “Income” for the period between the
end of the Plan Year and the date of the distribution (the “gap period”) is not
required to be distributed.

 

(5)           Excess
Contributions shall be treated as Employer contributions for purposes of Code
Sections 404 and 415 even if distributed from the Plan.

 

111

 

(c)           Notwithstanding the above, within twelve (12) after the
end of the Plan Year (or, if the Prior Year Testing methods used, within twelve
(12) months after the end of the prior Plan Year), the Employer may make an
special Quantified Non-Elective Contribution or Qualified Matching Contribution
in accordance with one of the following provisions which contribution shall be
allocated to the Qualified Non-Elective Contribution Account or Qualified
Matching Contribution Account of each Non-Highly Compensated Participant
eligible to share in the allocation in accordance with such provision.  The Employer shall provide the Administrator
with written notification of the amount of the contribution being made and to
which provision it relates.

 

(1)           A
Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated in the
same proportion that each Non-Highly Compensated Participant’s 414(s) Compensation
for the year (or prior year if the Prior Year Testing method is being used)
bears to the total 414(s) Compensation of all Non-Highly Compensated
Participants for such year.

 

(2)           A
Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated in the
same proportion that each Non-Highly Compensated Participant’s 414(s) Compensation
for the year (or prior year if the Prior Year Testing method is being used)
bears to the total 414(s) Compensation of all Non-Highly Compensated
Participants for such year.  However, for
purposes of this contribution, Non-Highly Compensated Participants who are not
employed at the end of the Plan Year (or at the end of the prior Plan Year if
the Prior Year Testing method is being used) and, if this is a standardized
Plan, who have not completed more than 500 Hours of Service for three (3) consecutive
calendar months if the Elapsed Time Method is selected in the Adoption
Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

(3)           A
Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated in equal
amounts per capita).

 

(4)           A
Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated in equal
amounts (per capita).  However, for
purposes of this contribution, Non-Highly Compensated Participants who are not
employed at the end of the Plan Year (or at the end of the prior Plan Year if
the

 

112

 

Prior Year Testing method is being used) and,
if this is a standardized Plan who have not completed more than 500 Hours of
Service (or three (3) consecutive calendar months if the Elapsed Time
Method is selected in the Adoption Agreement) during such Plan Year, shall not
be eligible to share in the allocation and shall be disregarded.

 

(5)           A
Qualified Non-Elective Contribution may be made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated to the
Qualified Non-Elective Contribution Account of the Non-Highly Compensated
Participant having the lowest 414(s) Compensation, until one of the tests set
forth tan Section 12.4 is Satisfied (or is anticipated to be satisfied), or
until such Non-Highly Compensated Participant has received the maximum “Annual
Addition” pursuant to Section 4.4.  This
process shall continue until one the tests set forth in Section 12.4 is
satisfied (or is anticipated to be satisfied).

 

(6)           A
Qualified Non-Elective Contribution may he made on behalf of Non-Highly
Compensated Participants in an amount sufficient to satisfy (or to prevent an
anticipated failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated to the
Qualified Non-Elective Contribution Account of the Non-Highly Compensated
Participant having the lowest 414(s) Compensation, until one of the tests
set forth in Section 12.4 is satisfied (or is anticipated to be satisfied),
or until such Non-Highly Compensated Participant has received the maximum “Annual
Addition” pursuant to Section 4.4. 
This process shall continue until one of the tests set forth in Section 12.4
is satisfied (or is anticipated to be satisfied).  However, for purposes of this contribution,
Non-Highly Compensated Participants who are not employed at the end of the Plan
Year (or at the end of the prior Plan Year if the Prior Year Testing method is
being used) and, if this is a standardized Plan, who have not completed more
than 500 Hours of Service for three (3) consecutive calendar months if the
Elapsed Time Method is selected in the Adoption Agreement) during such Plan
Year, shall not be eligible to share in the allocation and shall be
disregarded.

 

(7)           A
Qualified Matching Contribution may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated to the
Qualified Matching Contribution Account of each Non-Highly Compensated
Participant in the same proportion that each Non-Highly Compensated Participant’s
Elective Deferrals for the year bears to the total Elective Deferrals of all
Non-Highly Compensated Participants.

 

(8)           A
Qualified Matching Contribution may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated to the
Qualified Matching Contribution Account of

 

113

 

each Non-Highly Compensated Participant in
the same proportion that each Non-Highly Compensated Participants Elective
Deferrals for the year bears to the total Elective Deferrals of all Non-Highly
Compensated Participants.  However, for
purposes of this contribution, Non-Highly Compensated Participants who are not
employed at the end of the Plan Year (or at the end of the prior Plan Year if
the Prior Year Testing method is being used) and, if this is a standardized
Plan, who have not completed more than 500 Hours of Service (or three (3) consecutive
calendar months if the Elapsed Time Method is selected in the Adoption
Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

(9)           A
Qualified Matching Contribution may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.4.  Such contribution shall be allocated to the
Qualified Matching Contribution Account of the Non-Highly Compensated
Participant having having the lowest Elective Deferrals until one of the tests
set forth in Section 12.4 is satisfied (or is anticipated to be
satisfied), or until such Non-Highly Compensated Participant has received the
maximum “Annual Addition” pursuant to Section 4.4.  This process shall continue until one of the
tests set forth in Section 12.4 is satisfied (or is anticipated to be
satisfied).

 

(10)         A
Qualified Matching Contribution may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth Section 12.4.  Such contribution shall be allocated to the
Qualified Matching Contribution Account of the Non-Highly Compensated
Participant having the lowest Elective Deferrals until one of the tests set
forth in Section 12.4 is satisfied (or is anticipated to be satisfied), or
until such Non-Highly Compensated Participant has received the maximum “Annual
Addition” pursuant to Section 4.4. 
This process shall continue until one of the tests set -forth Section 12.4
is satisfied (or is anticipated to be satisfied).  However, for purposes of this contribution,
Non-Highly Compensated Participants who are not employed at the end of the Plan
Year (or at the end of the Prior Plan Year it the Prior Year Testing method is
being used) and if this a standardized Plan, who have not completed more than
500 Hours of Service for three (3) consecutive calendar months if the
Elapsed Time Method is selected in the Adoption Agreement) during such Plan
Year, shall not be eligible to share the allocation and shall be disregarded.

 

(d)           Any Excess Contributions (and “Income”) which are
distributed on or after 2 1/2 months after the end of the Plan Year shall be
subject to the ten percent (10%) Employer excise tax imposed by Code Section 4979.

 

114

 

12.6        ACTUAL
CONTRIBUTION PERCENTAGE TESTS

 

(a)           Except as otherwise provided herein,
this subsection applies if the Prior Year Testing method is elected in the
Adoption Agreement.  The “Actual
Contribution Percentage” (hereinafter “ACP”) for Participants who are Highly
Compensated Employees (hereinafter “HCEs”) for each Plan Year and the prior
year’s ACP for Participants who were Non-Highly Compensated Employees
(hereinafter “NHCEs”) for the prior Plan Year must satisfy one of the following
tests:

 

(1)           The
ACP for a Plan Year for Participants who are HCEs for the Plan Year shall not
exceed the prior year’s ACP for Participants who were NHCEs for the prior Plan
Year multiplied by 1.25; or

 

(2)           The
ACP for a Plan Year for Participants who are HCEs for the Plan Year shall not
exceed the prior year’s ACP for Participants who were NHCEs for the prior Plan
Year multiplied by 2.0, provided that the ACP for Participants who are HCEs
does not exceed the prior year’s ACP for Participants who were NHCEs in the
prior Plan Year by more than two (2) percentage points.

 

Notwithstanding the above, for purposes of
applying the foregoing tests with respect to the first Plan Year in which the
Plan permits any Participant to make Employee contributions, provides for
matching contributions, or both, the ACP for the prior years NHCEs shall be
deemed to be three percent (3%) unless the Employer has elected in the Adoption
Agreement to use the current Plan Year’s ACP for these Participants.  However, the provisions of this paragraph may
not be used if the Plan is as successor plan or is otherwise prohibited from
using such provisions pursuant to IRS Notice 98-1 (or superseding guidance).

 

(b)           Notwithstanding the preceding, if the
Current Year Testing method is elected in the Adoption Agreement, the ACP tests
in (a)(1) and (a)(2), above shall be applied by comparing the current Plan
Year’s ACP for Participants who are HCEs with the current Plan Year’s ACP
(rather than the prior Plan Year’s ACP for Participants who are NHCEs for the
current Plan Year.  Once made, this
election can only be changed if the Plan meets the requirements for changing to
the Prior Year Testing method set forth in IRS Notice 98-1 (or superseding
guidance).  Furthermore, this Plan must
use the same testing method for both the ADP and ACP tests for Plan Years
beginning on or after the date the Employer adopts its GUST restated plan.

 

(c)           This subsection applies to prevent
multiple use of the test set forth in subsection (a)(2) above.  Any HCE eligible to make Elective Deferrals
pursuant to Section 12.2 and to make after-tax voluntary Employee
contributions or to receive matching contributions under this Plan or under any
other plan maintained by the Employer or an Affiliated Employer, shall have
either the actual deferral ratio adjusted in the manner described in Section 12.5
or the actual contribution ratio reduced in the manner described in Section 12.7
so that the “Aggregate Limit” is not exceeded pursuant to Regulation
l.401(m)-2.  The amounts in excess of the
“Aggregate Limit” shall be

 

115

 

treated as either an Excess Contribution or
an Excess Aggregate Contribution.  The
ADP and ACP of the HCEs are determined after any corrections required to meet
the ADP and ACP tests and are deemed to be the maximum permitted under such
test for the Plan Year.  Multiple use
does not occur if either the ADP or ACP of the HCEs does not exceed 1.25
multiplied by the ADP and ACP of the NHCEs.

 

“Aggregate Limit” means the sum of (i) 125 percent of the greater
of the ADP of the NHCE for the Plan Year or the ACP of such NHCEs under the
plan subject to Code Section 401(m) for the Plan Year beginning with
or within the prior Plan Year of the cash or deferred arrangement and (ii) the
lesser of 200% or two plus the lesser of such ADP or ACP.  “Lesser” is substituted for “greater” in (i) above,
and “greater” is substituted for “lesser” after “two plus the” in (ii) above
if it would result in a larger Aggregate Limit. 
If the Employer has elected in the Adoption Agreement to use the Current
Year Testing method, then in calculating the “Aggregate Limit” for a particular
Plan Year, the NHCEs ADP and ACP for that Plan Year, instead of the prior Plan
Year, is used.

 

(d)           A Participant is a Highly Compensated
Employee for a particular Plan Year if the Participant meets the definition of
a Highly Compensated Employee in effect for that Plan Year.  Similarly, a Participant is a Non-highly
Compensated Employee for a particular Plan Year if the Participant does not
meet the definition of a Highly Compensated Employee in effect for that Plan
Year.

 

(e)           For the purposes of this Section and
Section 12.7, ACP for a specific group of Participants for a Plan Year
means the average of the “Contribution Percentages” (calculated separately for
each Participant in such group).  For
this purpose, “Contribution Percentage” means the ratio (expressed as a
percentage) of the Participant’s “Contribution Percentage Amounts” to the
Participants 414(s) Compensation. 
The actual contribution ratio for each Participant and the ACP for each
group, shall be calculated to the nearest one-hundredth of one percent of the
Participant’s 414(s) Compensation.

 

(f)            “Contribution
Percentage Amounts” means the sum of (i) after-tax voluntary Employee
contributions, (ii) Employer “Matching Contributions” made pursuant to Section 12.1(a)(2) (including
Qualified Matching Contributions to the extent such Qualified Matching
Contributions are not used to satisfy the tests set forth in Section 12.4),
(iii) Excess Contributions recharacterized as nondeductible voluntary
Employee contributions pursuant to Section 12.5, and (iv) Qualified
Non-Elective Contributions (to the extent not used to satisfy the tests set
forth in Section 12.4).  However, “Contribution
Percentage Amounts” shall not include “Matching Contributions” that are
forfeited either to correct Excess Aggregate Contributions or due to Code Section 401(a)(4) and
the Regulations thereunder because the contributions to which they relate are Excess
Deferrals, Excess Contributions, or Excess Aggregate Contributions.  In addition, “Contribution Percentage Amounts”
may include Elective Deferrals provided the ADP test in Section 12.4 is
met before the Elective Deferrals are used in the ACP test and continues to be
met following the exclusion of those Elective Deferrals that are used to meet
the ACP test.

 

116

 

(g)           For
purposes of determining the ACP and the amount of Excess Aggregate
Contributions pursuant to Section 12.7, only Employer “Matching
Contributions” (excluding “Matching Contributions” forfeited or distributed
pursuant to Section 12.2(e), 12.5(b), or 12.7(b)) contributed to the Plan
prior to the end of the succeeding Plan Year shall be considered.  In addition, the Administrator may elect to
take into account, with respect to Employees eligible to have Employer “Matching
Contributions” made pursuant to Section 12.1(a)(2) or after-tax
voluntary Employee contributions made pursuant to Section 4.7 allocated to
their accounts, elective deferrals (as defined in Regulation 1.402(g)-1(b)) and
qualified non-elective contributions (as defined in Code Section 401(m)(4)(C))
contributed to any plan maintained by the Employer.  Such elective deferrals and qualified
non-elective contributions shall be treated as Employer matching contributions
subject to Regulation 1.401(m)-1(b)(2) which is incorporated herein by
reference.  The Plan Year must be the
same as the plan year of the plan to which the elective deferrals and the
qualified non-elective contributions are made.

 

(h)           In
the event that this Plan satisfies the requirements of Code Sections 401(a)(4),
401(m), or 410(b) only if aggregated with one or more other plans, or if
one or more other plans satisfy the requirements of such sections of the Code
only if aggregated with this Plan, then this Section shall be applied by
determining the ACP of Employees as if all such plans were a single plan.  Plans may be aggregated in order to satisfy
Code section 401(m) only if they have the same Plan Year.

 

Any adjustments to the NHCE ACP for the prior
year will be made in accordance with IRS Notice 98-1 and any superseding
guidance, unless the Employer has elected in the Adoption Agreement to use the
Current 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 ACP testing method.

 

(i)            For
purposes of this Section, if an HCE is a Participant under two (2) or more
plans (other than an employee stock ownership plan as defined in Code Section 4975(e)(7))
which are maintained by the Employer or an Affiliated Employer to which “Matching
Contributions,” nondeductible voluntary Employee contributions, or both, are
made, all such contributions on behalf of such HCE shall be aggregated for
purposes of determining such HCP’s actual contribution ratio.  However, if the plans have different plan
years, this paragraph shall be applied by treating all plans ending with or
within the same calendar year as a single plan.

 

(j)            For purposes of this Section and
Section 12.7, a Highly Compensated Participant and a Non-Highly
Compensated Participant shall include any Employee eligible to have “Matching
Contributions” made pursuant to Section 12.1(a)(2) (whether or not a
deferral election was made or suspended pursuant to Section 12.2(g))
allocated to such Participant’s account for the Plan Year or to make salary
deferrals pursuant to Section 12.2 (if the Employer uses salary deferrals
to satisfy the provisions of this

 

117

 

Section) or after-tax voluntary Employee
contributions pursuant to Section 4.7 (whether or not nondeductible
voluntary Employee contributions are made) allocated to the Participant’s
account for the Plan Year.

 

(k)           For purposes of this Section and
Section 12.7, “Matching Contribution” means an Employer contribution made
to the Plan, or to a contract described in Code Section 403(b), on behalf
of a Participant on account of a nondeductible voluntary Employee contribution
made by such Participant, or on account of a Participant’s elective deferrals
under a plan maintained by the Employer.

 

(l)            For purposes of determining the ACP
and the amount of Excess Aggregate Contributions pursuant to Section 12.7,
only Elective Deferrals, Qualified Non-Elective Contributions, “Matching
Contributions” and Qualified Matching Contributions contributed to the Plan
prior to the end of the twelve (12) month period immediately following the Plan
Year to which the contributions relate shall be considered.

 

(m)          Notwithstanding
anything in this Section to the contrary, the provisions of this Section and
Section 12.7 may be applied separately (or will be applied separately to
the extent required by Regulations) to each “plan” within the meaning of
Regulation 1.401(k)-1(g)(11). 
Furthermore, for Plan Years beginning after December 31, 1998, the
provisions of Code Section 401(k)(3)(F) may be used to exclude from
consideration all Non-Highly Compensated Employees who have not satisfied the
minimum age and service requirements of Code Section 410(a)(1)(A).

 

12.7                        ADJUSTMENT
TO ACTUAL CONTRIBUTION PERCENTAGE TESTS

 

(a)           In
the event (or, with respect to subsection (g) below when the Prior Year
Testing method is being used, if it is anticipated) that for Plan Years
beginning after December 31, 1996, the Plan does not satisfy one of the
tests set forth in Section 12.6, the Administrator shall adjust Excess
Aggregate Contributions or the Employer shall make contributions pursuant to the
options set forth below or any combination thereof.  However, if the Prior Year testing method is
being used and it is anticipated that the Plan might not satisfy one of such
tests, then the Employer may make contributions pursuant to the options set forth
in subsection (c) below.

 

(b)           On
or before the fifteenth day of the third month following the end of the Plan
Year, but in no event later than the close of the following Plan Year the
Highly Compensated Participant having the largest allocation of “Contribution
Percentage Amounts” shall have a portion of such “Contribution Percentage
Amounts” (and “Income” allocable to such amounts) distributed or, if
non-Vested, Forfeited (including “Income” allocable to such Forfeitures) until
the total amount of Excess Aggregate Contributions has been distributed, or
until the amount of the Participant’s “Contribution Percentage Amounts” equals
the “Contribution Percentage Amounts” of the Highly Compensated Participant
having the next largest amount of “Contribution Percentage Amounts.”  This process shall continue until the total
amount of Excess Aggregate

 

118

 

Contributions has been distributed or forfeited.  Any distribution and/or Forfeiture of “Contribution
Percentage Amounts” shall be made in the following order:

 

(1)           Employer matching
contributions distributed and/or forfeited pursuant to Section 12.5(b)(1);

 

(2)           After-tax voluntary
Employee contributions including Excess Contributions recharacterized as
after-tax voluntary Employee contributions pursuant to Section 12.5(b)(2);

 

(3)           Remaining Employer
matching contributions.

 

(c)           Any
distribution or Forfeiture of less than the entire amount of Excess Aggregate
Contributions (and “Income”) shall be treated as a pro rata distribution of
Excess Aggregate Contributions and “Income.” 
Distribution of Excess Aggregate Contributions shall be designated by
the Employer as a distribution of Excess Aggregate Contributions (and “Income”).  Forfeitures of Excess Aggregate Contributions
shall be treated in accordance with Section 4.3.  However, no such Forfeiture may be allocated
to a Highly Compensated Participant whose contributions are reduced pursuant to
this Section.

 

(d)           For
the purpose of this Section, “Income” means the income or losses allocable to
Excess Aggregate Contributions, which amount shall be allocated at the same
time and in the same manner as income or losses are allocated pursuant to Section 4.3(c).  However, “Income” for the period between the
end of the Plan Year and the date of the distribution (the “gap period”) is not
required to be distributed.

 

(e)           Excess
Aggregate Contributions attributable to amounts other than nondeductible
voluntary Employee contributions, including forfeited matching contributions, shall
be treated as Employer contributions for purposes of Code Section 404 and
415 even if distributed from the Plan.

 

(f)            The
determination of the amount of Excess Aggregate Contributions with respect to
any Plan Year shall be made after first determining the Excess Contributions,
if any, to be treated as nondeductible voluntary Employee contributions due to
recharacterization for the plan year of any other qualified cash or deferred
arrangement (as defined in Code Section 401(k)) maintained by the Employer
that ends with or within the Plan Year or which are treated as after-tax
voluntary Employee contributions due to recharacterization pursuant to Section 12.5.

 

(g)           Notwithstanding
the above, within twelve (12) months after the end of the Plan Year (or, if the
Prior Year Testing method is used, within twelve (12) months after the end of
the prior Plan Year), the Employer may make a special Qualified Non-Elective
Contribution or Qualified Matching Contribution in accordance with one of the
following provisions which contribution shall be allocated to the Qualified
Non-Elective Contribution Account or Qualified Matching Contribution Account of
each Non-Highly

 

119

 

Compensated eligible to share in the allocation in accordance with such
provision.  The Employer shall provide
the Administrator with written notification of the amount of the contribution
being made and for which provision it is being made pursuant to.

 

(1)           A Qualified
Non-Elective Contribution may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.6.  Such contribution shall be allocated in the
same proportion that each Non-Highly Compensated Participant’s 414(s) Compensation
for the year (or prior year if the Prior Year Testing method is being used)
bears to the total 414(s) Compensation of all Non-Highly Compensated
Participants for such year.

 

(2)           A Qualified
Non-Elective Contribution may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.6.  Such contribution shall be allocated in the
same proportion that each Non-Highly Compensated Participant’s 414(s) Compensation
for the year (or prior year if the Prior Year Testing method is being used)
bears to the total 414(s) Compensation of all Non-Highly Compensated
Participants for such year.  However, for
purposes of this contribution, Non-Highly Compensated Participants who are not
employed at the end of the Plan Year (or at the end of the prior Plan Year if
the Prior Year Testing method is being used) and, if this is the standardized
Plan, who have not completed more than 500 Hours of Service (or three (3) consecutive
calendar months if the Elapsed Time Method is selected in the Adoption
Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

(3)           A qualified Non-Elective
Contribution may be made on behalf of the Non-Highly Compensated Participants
in an amount sufficient to satisfy (or to prevent an anticipated failure of)
one of the tests set forth in Section 12.6.  Such contribution shall be allocated in equal
amounts (per capita).

 

(4)           A Qualified
Non-Elective Contribution may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated
failure of) one of the tests set forth in Section 12.6.  Such contribution shall be allocated in equal
amounts (per capita).  However, for
purposes of this Contribution, Non-Highly Compensated Participants who are not
employed at the end of the Plan Year (or at the end of the prior Plan Year if
the Prior Year Testing method is being used) and, if this is a standardized
Plan, who have not completed more than 500 Hours of Service (or three (3) consecutive
calendar months if the Elapsed Time Method is selected in the Adoption
Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

120

 

(5)           A Qualified
Non-Elective Contribution may be made on behalf of  Non-Highly Compensated Participants in an
amount sufficient to satisfy (or to prevent an anticipated failure of) one of
the tests set forth in Section 12.6. 
Such contribution shall be allocated to the Qualified Non-Elective
Contribution Account of the Non-Highly Compensated Participant having the
lowest 414(s) Compensation, until one of the tests set forth in Section 12.6
is satisfied (or is anticipated to be satisfied), or until such Non-Highly
Compensated Participant has received the maximum “Annual Addition” pursuant to Section 414.  This process shall continue until one of the
tests set forth in Section 12.6 is satisfied (or is anticipated to be
satisfied).

 

(6)           A Qualified
Non-Elective Contribution may be made on behalf of Non-Highly Compensated
Participants in an amount sufficient to satisfy (or to prevent an anticipated failure
of) one of the tests set forth in Section 12.6.  Such contribution shall be allocated to the
Qualified Non-Elective Contribution Account of the Non-Highly Compensated
Participant having the lowest 414(s) Compensation, until one of the tests
set forth in Section 12.6 is satisfied (or is anticipated to be
satisfied), or until such Non-Highly Compensated Participant has received the
maximum “Annual Addition” pursuant to Section 414.  This process shall continue until one of the
tests set forth in Section 12.6 is satisfied (or is anticipated to be
satisfied).  However, for purposes of
this contribution, Non-Highly Compensated Employees who are not employed at the
end of the Plan Year (or at the end of the prior Plan Year if the Prior Year
Testing method is being used) and, if this is a standardized Plan, who have not
completed more than 500 Hours of Service (or three (3) consecutive
calendar months if the Elapsed Time Method is selected in the Adoption
Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

(7)           A “Matching
Contribution” may be made on behalf of Non-Highly Compensated Participants in
an amount sufficient to satisfy (or to prevent an anticipated failure of) one
of the tests set forth in Section 12.6. 
Such contribution shall be allocated on behalf of each Non-Highly
Compensated Participant in the same proportion that each Non-Highly Compensated
Participant’s Elective Deferrals for the year bears to the total Elective
Deferrals of all Non-Highly Compensated Participants.  The Employer shall designate, at the time the
contribution is made, whether the contribution made pursuant to this provision
shall be a Qualified Matching Contribution allocated to a Participant’s
Qualified Matching Contribution Account or an Employer Non-Elective
Contribution allocated to a Participant’s Non-Elective Account.

 

(8)           A “Matching
Contribution” may be made on behalf of Non-Highly Compensated Participants in
an amount sufficient to satisfy (or to prevent an anticipated failure of) one
of the tests set forth in Section 12.6. 
Such contribution shall be allocated on behalf of such Non-Highly
Compensated Participant in the same proportion that each Non-Highly Compensated
Participant’s Elective Deferrals for the year bears to the total Elective
Deferrals of all Non-Highly Compensated Participants.  The Employer shall designate, at the time the
contribution is made, whether a contribution made pursuant to this provision
shall

 

121

 

be a Qualified Matching Contribution allocated to a Participant’s
Qualified Matching Contribution Account or an Employer Non-Elective
Contribution allocated to a Participant’s Non-Elective Account.  However, for purposes of this contribution,
Non-Highly Compensated Participants who are not employed at the end of the Plan
Year (or at the end of the prior Plan Year if the Prior Year Testing method is
being used) and, if this is a standardized Plan, who have not completed more
than 500 Hours of Service (or three (3) consecutive calendar months if the
Elapsed Time Method is selected in the Adoption Agreement) during such Plan
Year, shall not be eligible to share in the allocation and shall be
disregarded.

 

(9)           A “Matching
Contribution” may be made on behalf of Non-Highly Compensated Participants in
an amount sufficient to satisfy (or to prevent an anticipated failure of) one
of the tests set forth in Section 12.4. 
Such contribution shall be allocated on behalf of the Non-Highly
Compensated Participant having the lowest Elective Deferrals until one of the
tests set forth in Section 12.4 is satisfied (or is anticipated to be
satisfied), or until such Non-Highly Compensated Participant has received the
maximum “Annual Addition” pursuant to Section 4.4.  This process shall continue until one of the
tests set forth in Section 12.4 is satisfied (or is anticipated to be
satisfied).  The Employer shall
designate, at the time the contribution is made, whether the contribution made
pursuant to this provision shall be a Qualified Matching Contribution allocated
to a Participant’s Qualified Matching Contribution Account or an Employer
Non-Elective Contribution allocated to a Participant’s Non-Elective Account.

 

(10)         A “Matching
Contribution” may be made on behalf of Non-Highly Compensated Participants in
an amount sufficient to satisfy (or to prevent an anticipated failure of) one
of the tests set forth in Section 12.4. 
Such contribution shall be allocated on behalf of the Non-Highly
Compensated Participant having the lowest Elective Deferrals until one of the
tests set forth in Section 12.4 is satisfied (or is anticipated to be
satisfied), or until such Non-Highly Compensated Participant has received the
maximum “Annual Addition” pursuant to Section 4.4.  This process shall continue until one of the
tests set forth in Section 12.4 is satisfied (or is anticipated to be
satisfied).  The Employer shall
designate, at the time the contribution is made, whether the contribution made
pursuant to this provision shall be a Qualified Matching Contribution allocated
to a Participant’s Qualified Matching Contribution Account or an Employer
Non-Elective Contribution allocated to a Participant’s Non-Elective
Account.  However, for purposes of this
contribution, Non-Highly Compensated Participants who are not employed at the
end of the Plan Year (or at the end of the prior Plan Year if the Prior Year
Testing method is being used) and, if this is a standardized Plan, who have not
completed more than 500 Hours of Service (or three (3) consecutive
calendar months if the Elapsed Time Method is selected in the Adoption
Agreement) during such Plan Year, shall not be eligible to share in the
allocation and shall be disregarded.

 

(h)           Any
Excess Aggregate Contributions (and “Income”) which are distributed on or after
2 1/2 months after the end of the Plan Year shall be subject to the ten
percent (10%) Employer excise tax imposed by Code Section 4979.

 

122

 

12.8        SAFE
HARBOR PROVISIONS

 

(a)           The
provisions of this Section will apply if the Employer has elected, in the
Adoption Agreement, to use the “ADP Test SafeHarbor” or “ACP Test Safe Harbor.”
If the Employer has elected to use the “ADP Test Safe Hatbor” for a Plan Year,
then the provisions relating to the ADP test described in Section 12.4 and
in Code Section 401(k)(3) do not apply for such  Plan Year. 
In addition, if the Employer has also elected to use the “ACP Test Safe
Harbor” for a Plan Year, then the provisions relating to the ACP test described
in Section 12.6 and in Code Section 401(m)(2) do not apply for
such Plan Year.  Furthermore, to the
extent any other provision of the Plan is inconsistent with the provisions of
this Section, the provisions of this Section will govern.

 

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

 

(1)           “ACP Test Safe
Harbor” means the method described in subsection (c) below for satisfying
the ACP test of Code Section 401(m)(2).

 

(2)           “ACP Test Safe
Harbor Matching Contributions” means “Matching Contributions” described in
subsection (d)(1).

 

(3)           “ADP Test Safe
Harbor” means the method described in subsection (c) for satisfying the
ADP test of Code Section 401(k)(3).

 

(4)           “ADP Test Safe
Harbor Contributions” means “Matching Contributions” and nonelective
contributions described in subsection (c)(1) below.

 

(5)           “Compensation” means
Compensation as defined in Section 1.11, except, for purposes of this
Section, no dollar limit, other than the limit imposed by Code Section 401(a)(17),
applies to the Compensation of a Non-Highly Compensated Employee.  However, solely for purposes of determining
the Compensation subject to a Participant’s deferral election, the Employer may
use an alternative definition to the one described in the preceding sentence,
provided such alternative definition is a reasonable definition within the
meaning of Regulation 1.414(s)-1(d)(2) and permits each Participant to
elect sufficient Elective Deferrals to receive the maximum amount of “Matching
Contributions” (determined using the definition of Compensation described in
the preceding sentence) available to the Participant under the Plan.

 

(6)           “Eligible
Participant” means a Participant who is eligible to  make Elective Deferrals under the Plan for
any part of the Plan Year (or who would be eligible to make Elective Deferrals
but for a suspension due to a hardship distribution described in Section 12.9
or to statutory limitations, such as Code Section 402(g) and 415) and
who is not excluded as an “Eligible Participant” under the 401(k) Safe
Harbor elections in the Adoption Agreement.

 

123

 

(7)           “Matching
Contributions” means contributions made by the Employer on account of an “Eligible
Participant’s” Elective Deferrals.

 

(c)           The provisions of
this subsection apply for purposes of satisfying the “ADP Test Safe Harbor.”

 

(1)           The “ADP Test Safe
Harbor Contribution” is the contribution elected by the Employer in the
Adoption Agreement to be used to satisfy the “ADP Test Safe Harbor.”  However, if no contribution is elected in the
Adoption Agreement, the Employer will contribute to the Plan for the Plan Year
a “Basic Matching Contribution” on behalf of each “Eligible Employee.”  The “Basic Matching Contribution” is equal to
(i) one-hundred percent (100%) of the amount of an “Eligible Participant’s”
Elective Deferrals that do not exceed three percent (3%) of the Participant’s “Compensation”
for the Plan Year, plus (ii) fifty percent (50%) of the amount of the
Participant’s Elective Deferrals that exceed three percent (3%) of the
Participant’s “Compensation” but do not exceed five percent (5%) of the
Participant’s “Compensation.”

 

(2)           Except as provided
in subsection (e) below, for purposes of the Plan, a Basic Matching
Contribution or an Enhanced Matching Contribution will be treated as Qualified
Matching Contribution and a Nonelective Safe Harbor Contribution will be
treated as Qualified Non-Elective Contribution. Accordingly, the “ADP Test Safe
Harbor Contribution” will be fully Vested and subject to the distribution
restrictions set forth in Section 12:2(c) (i.e., may generally not be
distributed earlier than separation from service, death, disability, an event
described in Section 401(k)(1), or, in case of a profit sharing plan, the
attainment of age 59 1/2.  In addition,
such contributions must satisfy the “ADP Test Safe Harbor” without regard to
permitted disparity under Code Section 401(1).

 

(3)           At least thirty (30)
days, but not more than ninety (90) days, before the beginning of the Plan
Year, the Employer will provide each “Eligible Participant” a
comprehensive notice of the Participant’s rights and obligations
under the Plan, written in a manner calculated to be understood by the average
Participant. However, if an Employee becomes eligible after the 90th day before
the beginning of the Plan Year and does not receive the notice for that reason,
the notice must be provided no more than ninety (90) days before the Employee
becomes eligible but not later than the date the Employee becomes eligible.

 

(4)           In addition to any
other election periods provided under the Plan, each “Eligible Participant” may
make or modify a deferral election during the thirty (30) day period
immediately following receipt of the notice described in subsection (3) above.  Furthermore, if the “ADP Test Safe Harbor” is
a “Matching Contribution” each “Eligible Employee” must be permitted to elect
sufficient Elective Deferrals to receive the maximum amount of “Matching
Contributions” available to the Participant under the Plan.

 

124

 

(d)           The provisions of
this subsection apply if the Employer has elected to satisfy the “ACP Test Safe
Harbor.”

 

(1)           In addition to the
“ADP Test Safe Harbor Contributions.” the Employer will make any “Matching.
Contribution”  in accordance with elections made in the Adoption
Agreement. Such additional “Matching Contributions” will be considered “ACP
Test Safe Harbor Matching Contributions.”

 

(2)           Notwithstanding any
election in the Adoption Agreement to the contrary, an “Eligible Participant’s”
Elective Deferrals in excess of six percent (6%)             of Compensation” may not be taken into account in
applying “ACP Test Safe Harbor Matching Contributions” In addition, effective
with respect to Plan Years beginning after December 31, 1999, any portion
of an “ACP Test Safe Harbor Matching Contribution” attributable to
discretionary Matching Contribution” may not exceed four percent (4%) of an “Eligible
Participant’s” “Compensation.”

 

(e)           The Plan is required
to satisfy the ACP test of Code Section 401(m)(2), using the current year
testing method, if the Plan permits after-tax voluntary Employee contributions
or if matching contributions that do not satisfy the “ACP Test Safe Harbor” may
be made to the Plan.  In such event, only
“ADP Test Safe Harbor Contributions” or “ACP Test Safe Harbor Contributions”
that exceed the amount needed to satisfy the “ADP Test Harbor” or “ACP Test
Safe Harbor” (if the Employer has elected to use the ACP Test Safe Harbor”) may
be treated as Qualified Nonelective Contributions or Qualified Matching
Contributions in applying the ACP test. 
In addition, in applying the ACP test, elective contributions may not
treated as matching contributions under Code Section 401(m)(3).  Furthermore, in applying the ACP test, the
Employer may elect to disregard with respect to all “Eligible Participant’s”
all “Matching Contributions” if the only “‘Matching Contributions” made to the
Plan satisfy the “ADP Test Safe Harbor Contribution” (the “Basic Matching
Contribution” or the “Enhanced Matching Contribution”) and (2) if the “ACP
Test Safe Harbor” is satisfied, “Matching Contributions” that do not exceed
four percent (4%) of each Participant’s “Compensation.”

 

12.9        ADVANCE
DISTRIBUTION FOR HARDSHIP

 

(a)           The
Administrator, at the election of a Participant, shall direct the Trustee to
distribute to the Participant in any one Plan Year up to the lesser of (1) 100%
of the accounts as elected in the Adoption Agreement valued as of the last
Valuation Date or (2) the amount necessary to satisfy the immediate and
heavy financial need of the Participant. Any distribution made pursuant to this
Section shall be deemed to he made as of the first day of the Plan Year
or, if later, the Valuation Date immediately preceding the date of
distribution, and the account from which the distribution is made shall he
reduced accordingly.  Withdrawal under
this Section shall be authorized only if the distribution is for one of
the following or any other item permitted under Regulation 1.40(k)-1(2)(iv):

 

125

 

(1)           Medical expenses
described in Code Section 2(3)(d) incurred by the Participant, the
Participants spouse, or any of the Participant’s dependents (as defined in Code
Section 152) or necessary for these persons to obtain medical care as
described in Code Section 213(d).

 

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

 

(3)           Payment of tuition
and related educational fees, and room and board expenses, for the next twelve
(12) months of post-secondary education for the Participant the Participants
spouse, children, or dependents (as defined in Code Section 152); or

 

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

 

(b)           No distribution
shall be made pursuant to this Section unless the Administrator, based
upon the Participant’s representation and such other facts as are known
to the Administrator, determines that all of the following conditions are
satisfied:

 

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

 

(2)           The Participant has
obtained all distributions, other than hardship distributions, and all
nontaxable loans currently available under all plans maintained by the Employer
(to the extent the loan would not increase the hardship);

 

(3)           The Plan, and all
other plans maintained by the Employer, provide that the Participant’s elective
deferrals and nondeductible voluntary Employee contributions will be suspended
for at least twelve (12) months after receipt of the hardship distribution; and

 

(4)           The Plan, and all
other plans maintained by the Employer, provide that the Participant may not
make elective deferrals for the Participant’s taxable year immediately following
the taxable year of the hardship distribution in excess of the applicable limit
under Code Section 402(g) for such next taxable year less the amount
of such Participant’s elective deferrals for the taxable year of the hardship
distribution.

 

(c)           Notwithstanding the
above, distributions from the Participant’s Elective Deferral Account,
Qualified Matching Contribution Account and Qualified Non-Elective Account
pursuant to this Section shall be limited solely to the Participant’s
Elective Deferrals and any income attributable thereto credited to the
Participant’s Elective Deferral Account as of December 31, 1988.  Furthermore, if a hardship distribution is
permitted from more than one account type, the Administrator may determine any
ordering of a Participant’s hardship distribution from such accounts.

 

126

 

(d)           Any distribution
made pursuant to this Section shall be made in a manner which is
consistent with and satisfies the provisions of Section 6.5, including,
but not limited to, all notice and consent requirements of Code Sections 411(a) and
417 and the Regulations thereunder.

 

ARTICLE XIII

SIMPLE 401(k) PROVISIONS

 

13.1        SIMPLE
401(k) PROVISIONS

 

(a)           If elected in the
Adoption Agreement, this Plan is intended to be 401(k) plan which
satisfies the requirements if Code Sections 401(k)(11) and 401(m)(10).

 

(b)           The provisions of
this Article apply for a “year” only if the following conditions are met:

 

(1)           The Employer
adopting this Plan is an “eligible employer.” An “eligible employer means, with
respect to any “year,” an Employer that had no more than 100 Employees who
received at least $5,000 of “compensation” from the Employer for the preceding “year.”  In applying the preceding sentence, all
employees of an Affiliated Employer are taken into account.

 

An “eligible employer” that has elected to use the SIMPLE 401(k) provisions
but fails to be an “eligible employer for any Subsequent “year,” is treated as
an “eligible employer” for the two (2) “years” following the last “year”
the Employer was an “eligible employer, if the failure is due to any
acquisition, disposition, or similar transaction involving an “eligible
employer,” the preceding sentence applies only if the provisions of Code Section 410(b)(6)(C)(i) are
satisfied.

 

(2)           No contributions are
made or benefits accrued for services during the “year,” on behalf of any “eligible
employee” under any other plan, contract, pension, or trust described in Code Section 2l9(g)(5)(A) or
(B), maintained by the Employer.

 

(c)           To the extent that
any other provision of the Plan is inconsistent with the provisions of this
Article, the provisions of this Article govern.

 

13.2        DEFINITIONS

 

(a)           “Compensation”
means, for purposes of this Article, the sum of the wages, tips, and other
compensation from the Employer subject to federal income tax withholding (as
described in Code Section 6051(a)(3)) and the Employee’s salary reductions
contributions made under this or any other 401 (k) plan, and, if
applicable, elective deferrals under a Code Section 408(p) SIMPLE
plan, a SARSEP, or a Code Section 403(b) annuity contract and
compensation deferred under a Code Section 457 plan, required to be
reported by the Employer on Form W-2 (as described in Code Section 6051(a)(8)).  For self-employed

 

127

 

individuals, “compensation”  means net earnings from
self-employment determined under Code Section 1402(a) prior to
subtracting any contributions made under this Plan on behalf of the
individual.  The provisions of the plan
implementing the limit on Compensation under Code Section 401(a)(17) apply
to the “compensation” under this Article.

 

(b)           “Eligible employee”
means, for purposes of this Article, any Participant who is entitled to make
elective deferrals described in Code Section 402(g) under the terms
of the Plan.

 

(c)           “Year” means the
calendar year.

 

13.3        CONTRIBUTIONS

 

(a)           Salary Reduction
Contributions

 

(1)           Each “eligible
employee” may make a salary reduction election to have “compensation” reduced
for the “year” in any amount selected by the Employee subject to the limitation
in subsection (c) below.  The
Employer will make a salary reduction contribution to the Plan, as an Elective
Deferral, in the amount by which the Employee’s “compensation” has been
reduced.

 

(2)           The total salary
reduction contribution for the “year” cannot exceed $6,000 for any
Employee.  To the extent permitted by
law, this amount will be adjusted to reflect any annual cost-of-living
increases announced by the IRS.

 

(b)           Other Contributions

 

(1)           Matching
Contributions. Unless (2) below is elected, each “year” the Employer will
make a matching contribution to the Plan on behalf of each Employee who makes a
salary reduction election under Section 13.3(a).  The amount of the matching contribution will
be equal to the Employee’s salary reduction contribution up to a limit of three
percent (3%) of the Employees “compensation” for the full “year.”

 

(2)           Nonelective
Contributions. For any “year,” instead of a matching contribution, the Employer
may elect to contribute a nonelective contribution of two percent (2%) of
“compensation” for the “year” for each “eligible employee” who
received at least $5,000 of “compensation from the Employer for the “year.”

 

(c)           Limitation on Other
Contributions

 

No Employer or Employee contributions may be made to this Plan for the “year”
other than salary reduction contributions described in Section 13.3(a),
matching or nonelective contributions described in Section 13.3(b) and
rollover contributions described in Regulation Section 1402(c)-2,
Q&A-1(a).  Furthermore, the
provisions of` Section 4.4 which implement the limitations of
Code Section 415 apply to contributions made pursuant to this Section.

 

128

 

13.4        ELECTION
AND NOTICE REQUIREMENTS

 

(a)           Election Period

 

(1)           In addition to any
other election periods provided under the Plan, each “eligible employee” may
make or modify a salary reduction election during the 60-day period immediately
preceding each January 1st.

 

(2)           For the “year” an
Employee becomes eligible to make salary reduction contributions under this
Article, the 60-day election period requirement of subsection (a)(1) is
deemed satisfied if the Employee may make or modify a salary reduction election
during a 60-day period that includes either the date the Employee becomes
eligible or the day before.

 

(3)           Each “eligible
employee” may terminate a salary reduction election at any time during the “year.”

 

(b)           Notice Requirements.

 

(1)           The Employer will
notify each “eligible employee” prior to the 60-day election period described
in Section 13.4(a) that a salary reduction election or a modification
to a prior election may be made during that period.

 

(2)           The notification
described in (1) above will indicate whether the Employer will provide a
matching contribution described in Section 13.3(b)(l) or a two
percent (2%) nonelective contribution described in section 13.3(b)(2).

 

13.5        VESTING
REQUIREMENTS

 

All benefits attributable to contributions made pursuant to this Article are
nonforfeitable at all times, and all previous contributions made under the Plan
are nonforfeitable as of the beginning of the Plan Year that the 401(k) SIMPLE
provisions apply.

 

13.6        TOP-HEAVY
RULES

 

The Plan is not treated as a top heavy plan under Code Section 416
for any year for which the provisions of this Article are effective and
satisfied.

 

13.7        NONDISCRIMINATION
TESTS

 

The Plan is treated as meeting the requirements of Code Sections
401(k)(3)(A)(ii) and 401(m)(2) for any “year” for which the
provisions of this Article are effective and satisfied.  Accordingly, Sections 12.4, 12.5, 12.6 and
12.7 shall not apply to the Plan.

 

129

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