Document:

Exhibit 10.1

 

GTSI EMPLOYEES’ 401(k) 

INVESTMENT PLAN

 

 

TABLE OF CONTENTS

 

	
  INTRODUCTION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
  FORMAT AND
  DEFINITIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 1.01

  	
  Format

  	
   

  
	
  Section 1.02

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  PARTICIPATION

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 2.01

  	
  Active Participant

  	
   

  
	
  Section 2.02

  	
  Inactive Participant

  	
   

  
	
  Section 2.03

  	
  Cessation of Participation

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  CONTRIBUTIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 3.01

  	
  Employer Contributions

  	
   

  
	
  Section 3.01A

  	
  Rollover Contributions

  	
   

  
	
  Section 3.02

  	
  Forfeitures

  	
   

  
	
  Section 3.03

  	
  Allocation

  	
   

  
	
  Section 3.04

  	
  Contribution Limitation

  	
   

  
	
  Section 3.05

  	
  Excess
  Amounts

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  INVESTMENT
  OF CONTRIBUTIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  BENEFITS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 5.01

  	
  Retirement
  Benefits

  	
   

  
	
  Section 5.02

  	
  Death
  Benefits

  	
   

  
	
  Section 5.03

  	
  Vested
  Benefits

  	
   

  
	
  Section 5.04

  	
  When
  Benefits Start

  	
   

  
	
  Section 5.05

  	
  Withdrawal
  Benefits

  	
   

  
	
  Section 5.06

  	
  Loans
  to Participants

  	
   

  
	
  Section 5.07

  	
  Distributions
  Under Qualified Domestic Relations Orders

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  DISTRIBUTION
  OF BENEFITS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 6.01

  	
  Automatic
  Forms of Distribution

  	
   

  
	
  Section 6.02

  	
  Optional
  Forms of Distribution

  	
   

  
	
  Section 6.03

  	
  Election
  Procedures

  	
   

  
	
  Section 6.04

  	
  Notice
  Requirements

  	
   

  

 

3

 

	
  ARTICLE VII

  	
  DISTRIBUTION
  REQUIREMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 7.01

  	
  Application

  	
   

  
	
  Section 7.02

  	
  Definitions

  	
   

  
	
  Section 7.03

  	
  Distribution
  Requirements

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  	
  TERMINATION
  OF THE PLAN

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
  ADMINISTRATION
  OF THE PLAN

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 9.01

  	
  Administration

  	
   

  
	
  Section 9.02

  	
  Expenses

  	
   

  
	
  Section 9.03

  	
  Records

  	
   

  
	
  Section 9.04

  	
  Information
  Available

  	
   

  
	
  Section 9.05

  	
  Claim
  and Appeal Procedures

  	
   

  
	
  Section 9.06

  	
  Delegation
  of Authority

  	
   

  
	
  Section 9.07

  	
  Exercise
  of Discretionary Authority

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
  GENERAL
  PROVISIONS

  	
   

  
	
   

  	
   

  	
   

  
	
  Section 10.01

  	
  Amendments

  	
   

  
	
  Section 10.02

  	
  Direct
  Rollovers

  	
   

  
	
  Section 10.03

  	
  Mergers
  and Direct Transfers

  	
   

  
	
  Section 10.04

  	
  Provisions
  Relating to the Insurer and Other Parties

  	
   

  
	
  Section 10.05

  	
  Employment
  Status

  	
   

  
	
  Section 10.06

  	
  Rights
  to Plan Assets

  	
   

  
	
  Section 10.07

  	
  Beneficiary

  	
   

  
	
  Section 10.08

  	
  Nonalienation
  of Benefits

  	
   

  
	
  Section 10.09

  	
  Construction

  	
   

  
	
  Section 10.10

  	
  Legal
  Actions

  	
   

  
	
  Section 10.11

  	
  Small
  Amounts

  	
   

  
	
  Section 10.12

  	
  Word
  Usage

  	
   

  
	
  Section 10.13

  	
  Change
  in Service Method

  	
   

  
	
  Section 10.14

  	
  Military
  Service

  	
   

  

 

4

 

INTRODUCTION

 

The Primary
Employer previously established a 401(k) plan on April 1, 1991.

 

The Primary
Employer is of the opinion that the plan should be changed. It believes that
the best means to accomplish these changes is to completely restate the plan’s
terms, provisions and conditions. The restatement, effective January 1,
1997, is set forth in this document and is substituted in lieu of the prior
document.

 

This
restatement is made retroactively to reflect the law changes made through the
Internal Revenue Service Restructuring and Reform Act of 1998. The provisions
of this Plan apply as of the effective date of the restatement except as
provided in the attached addendums which reflect the operation of the Plan
between the effective date of the restatement and the date this restatement is
adopted and identify those provisions which are not amended retroactively.

 

The restated
plan continues to be for the exclusive benefit of employees of the Employer.
All persons covered under the plan on December 31, 1996, shall continue to
be covered under the restated plan with no loss of benefits.

 

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

 

5

 

ARTICLE I

 

FORMAT
AND DEFINITIONS

 

SECTION 1.01—FORMAT.

 

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

 

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

 

SECTION 1.02—DEFINITIONS.

 

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

 

(a)                                  Elective
Deferral Contributions

 

(b)                                 Matching
Contributions

 

(c)                                  Qualified
Nonelective Contributions

 

(d)                                 Other
Employer Contributions

 

(e)                                  Rollover
Contributions

 

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

 

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

 

Accrual Computation Period means a
consecutive 12-month period ending on the last day of each Plan Year, including
corresponding consecutive 12-month periods before April 1, 1991.

 

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

 

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

 

6

 

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

 

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

 

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

 

Annuity Contract means the annuity contract
or contracts into which the Primary Employer enters with the Insurer for
guaranteed benefits, for the investment of Contributions in separate accounts,
and for the payment of benefits under this Plan. The term Annuity Contract as
it is used in this Plan shall include the plural unless the context clearly
indicates the singular is meant.

 

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

 

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

 

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

 

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

 

Compensation means, except for purposes of
the CONTRIBUTION LIMITATION SECTION of Article III and Article XI,
the total earnings, except as modified in this definition, paid or made
available to an Employee by the Employer during any specified period.

 

“Earnings” in this definition means wages
within the meaning of Code Section 3401(a) and all other payments of
compensation to an Employee by the Employer (in the course of the Employer’s
trade or business) for which the Employer is required to furnish the Employee a
written statement under Code Sections 6041(d), 6051(a)(3), and 6052. Earnings
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)). The amount reported in
the “Wages, Tips and Other Compensation” box on Form W-2 satisfies this
definition.

 

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

 

7

 

Compensation shall exclude reimbursements or
other expense allowances, fringe benefits (cash and noncash), moving expenses,
deferred compensation (other than elective contributions), and welfare
benefits.

 

Compensation shall also include elective
contributions. For this purpose, elective contributions are amounts contributed
by the Employer pursuant to a salary reduction agreement and which are not
includible in the gross income of the Employee under Code Section 125,
402(e)(3), 402(h)(1)(B), or 403(b). Elective contributions also include compensation
deferred under a Code Section 457 plan maintained by the Employer and
employee contributions “picked up” by a governmental entity and, pursuant to
Code Section 414(h)(2), treated as Employer contributions. For years
beginning after December 31, 1997, elective contributions shall also
include amounts contributed by the Employer pursuant to a salary reduction
agreement and which are not includible in the gross income of the Employee
under Code Section 132(f)(4).

 

For purposes of the EXCESS AMOUNTS SECTION of
Article 111, the Employer may elect to use an alternative
nondiscriminatory definition of Compensation in accordance with the regulations
under Code Section 414(s).

 

For Plan Years beginning on or after January 1,
1994, the annual Compensation of each Participant taken into account for
determining all benefits provided under the Plan for any determination period
shall not exceed $150,000, as adjusted 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 12 months, the annual limit is an amount equal to the otherwise applicable
annual limit multiplied by a fraction. The numerator of the fraction is the
number of months in the short determination period, and the denominator of the
fraction is 12.

 

If Compensation for any prior determination
period is taken into account in determining a Participant’s contributions or
benefits for the current Plan Year, the Compensation for such prior
determination period is subject to the applicable annual compensation limit in
effect for that determination period. For this purpose, in determining
contributions or benefits 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.

 

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

 

Compensation Year means the consecutive
12-month period ending on the last day of each Plan Year, including
corresponding periods before April 1, 1991.

 

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

 

8

 

Contributions means

 

Elective Deferral Contributions, Matching
Contributions, 

Qualified Nonelective Contributions, Discretionary Contributions, Rollover Contributions

 

as set out in Article III, unless the
context clearly indicates only specific contributions are meant.

 

Controlled Group means any group of
corporations, trades, or businesses of which the Employer is a part that are
under common control. A Controlled Group includes any group of corporations,
trades, or businesses, whether or not incorporated, which is either a
parent-subsidiary group, a brother-sister group, or a combined group within the
meaning of Code Section 414(b), Code Section 414(c) and regulations
thereunder and, for purposes of determining contribution limitations under the
CONTRIBUTION LIMITATION SECTION of Article III, as modified by Code Section 415(h)
and, for the purpose of identifying Leased Employees, as modified by Code Section 144(a)(3).
The term Controlled Group, as it is used in this Plan, shall include the term
Affiliated Service Group and any other employer required to be aggregated with
the Employer under Code Section 414(o) and the regulations thereunder.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

9

 

Eligible Employee means any Employee of the
Employer who meets the following requirement. His employment classification
with the Employer is the following:

 

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

 

Not a nonresident alien, within the meaning
of Code Section 7701(b)(1)(B), who receives no earned income, within the
meaning of Code Section 911(d)(2), from the Employer which constitutes
income from sources within the United States, within the meaning of Code Section 861(a)(3),
or who receives such earned income but it is all exempt from income tax in the
United States under the terms of an income tax convention.

 

Eligible Retirement Plan means an individual
retirement account described in Code Section 408(a), an individual
retirement annuity described in Code Section 408(b), an annuity plan
described in Code Section 403(a) or a qualified trust described in 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.

 

Eligible Rollover Distribution means any
distribution of all or any portion of the balance to the credit of the
Distributee, except that an Eligible Rollover Distribution does not include:
(i) any distribution that is one of a series of substantially equal periodic
payments (not less frequently than annually) made for the life (or life
expectancy) of the Distributee or the joint lives (or joint life expectancies)
of the Distributee and the Distributee’s designated Beneficiary, or for a
specified period of ten years or more; (ii) any distribution to the extent such
distribution is required under Code Section 401 (a)(9); (iii) any hardship
distribution described in Code Section 401(k)(2)(B)(i)(IV) received after December 31,
1998; (iv) the portion of any other distribution(s) that is not includible in
gross income (determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities); and (v) any other
distribution(s) that is reasonably expected to total less than $200 during a
year.

 

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

 

The term Employee shall include any
Self-employed Individual treated as an employee of any employer described in
the preceding paragraph as provided in Code Section 401(c)(1). The term
Employee shall also include any Leased Employee deemed to be an employee of any
employer described in the preceding paragraph as provided in Code Section 414(n)
or (o).

 

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

 

10

 

Employer Contributions means

 

Elective Deferral Contributions Matching
Contributions

Qualified Nonelective Contributions Discretionary Contributions

 

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

 

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

 

Entry Date means the date an Employee first enters
the Plan as an Active Participant. See the ACTIVE PARTICIPANT SECTION of Article II.

 

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

 

Fiscal Year means the Primary Employer’s
taxable year. The last day of the Fiscal Year is December 31.

 

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

 

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

 

Highly Compensated Employee means any
Employee who:

 

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

 

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

 

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

 

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

 

Calendar year data elections and top-paid
group elections, once made, apply for all subsequent years unless changed by
the Employer. If the Employer makes one election, the Employer is not required
to make the other. If both elections are made, the look-back year in
determining the top-paid group must

 

11

 

be the calendar year beginning with or within
the look-back year. These elections must apply consistently to the
determination years of all plans maintained by the Employer which reference the
highly compensated employee definition in Code Section 414(q), except as
provided in Internal Revenue Service Notice 97-45 (or superseding guidance).
The consistency requirement will not apply to determination years beginning
with or within the 1997 calendar year, and for determination years beginning on
or after January 1, 1998 and before January 1, 2000, satisfaction of
the consistency requirement is determined without regard to any nonretirement
plans of the Employer.

 

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

 

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

 

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

 

Hour-of-Service means the following:

 

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

 

(b)                                 Each
hour for which an Employee is paid, or entitled to payment, by the Employer
because of a period of time in which no duties are performed (irrespective of
whether the employment relationship has terminated) due to vacation, holiday,
illness, incapacity (including disability), layoff, jury duty, military duty or
leave of absence. Notwithstanding the preceding provisions of this subparagraph
(b), no credit will be given to the Employee:

 

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

 

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

 

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

 

For purposes of this subparagraph (b), a
payment shall be deemed to be made by, or due from the Employer, regardless of
whether such payment is made by, or due from the Employer, directly or indirectly
through, among others, a trust fund or insurer, to which the Employer
contributes or

 

12

 

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

 

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

 

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

 

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

 

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

 

Inactive Participant means a former Active
Participant who has an Account. See the INACTIVE PARTICIPANT SECTION of Article 11.

 

Insurer means Principal Life Insurance
Company and any other insurance company or companies named by the Trustee or
Primary Employer.

 

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

 

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

 

The Investment Fund shall be allocated at all
times to Participants, except as otherwise expressly provided in the Plan. The
Account of a Participant shall be credited with its share of the gains and
losses of the Investment Fund. That part of a Participant’s Account invested in
a funding arrangement

 

13

 

which establishes one or more accounts or
investment vehicles for such Participant thereunder shall be credited with the
gain or loss from such accounts or investment vehicles. The part of a Participant’s
Account which is invested in other funding arrangements shall be credited with
a proportionate share of the gain or loss of such investments. The share shall
be determined by multiplying the gain or loss of the investment by the ratio of
the part of the Participant’s Account invested in such funding arrangement to
the total of the Investment Fund invested in such funding arrangement.

 

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

 

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

 

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

 

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

 

Late Retirement Date means the first day of
any month which is after a Participant’s Normal Retirement Date and on which
retirement benefits begin. If a Participant continues to work for the Employer
after his Normal Retirement Date, his Late Retirement Date shall be the
earliest first day of the month on or after the date he ceases to be an
Employee. An earlier or a later Retirement Date may apply if the Participant so
elects. An earlier Retirement Date may apply if the Participant is age 70 1/2.
See the WHEN BENEFITS START SECTION of Article V.

 

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

 

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

 

(a)                                  such
employee is covered by a money purchase pension plan providing (i) a
nonintegrated employer contribution rate of at least 10 percent of
compensation, as defined in Code Section 415(c)(3), but for years
beginning before January 1, 1998, including amounts contributed pursuant
to a salary reduction agreement which are excludible from the employee’s gross
income under Code Sections 125, 402(e)(3), 402(h)(1)(B), or 403(b), (ii)
immediate participation, and (iii) full and immediate vesting, and

 

14

 

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

 

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

 

The Loan Administrator is Benefits Manager.

 

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

 

Monthly Date means each Yearly Date and the
same day of each following month during the Plan Year beginning on such Yearly
Date.

 

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

 

The Named Fiduciary is the Employer.

 

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

 

Nonvested Account means the excess, if any,
of a Participant’s Account over his Vested Account. Normal Form means a single
life annuity with installment refund.

 

Normal Retirement Age means the age at which
the Participant’s normal retirement benefit becomes nonforfeitable if he is an
Employee. A Participant’s Normal Retirement Age is the older of age 65 or his
age on the date 5 years after the first day of the Plan Year in which his Entry
Date occurred.

 

Normal Retirement Date means the earliest
first day of the month on or after the date the Participant reaches his Normal
Retirement Age. Unless otherwise provided in this Plan, a Participant’s
retirement benefits shall begin on a Participant’s Normal Retirement Date if he
has ceased to be an Employee on such date and has a Vested Account. Even if the
Participant is an Employee on his Normal Retirement Date, he may choose to have
his retirement benefit begin on such date. An earlier Retirement Date may apply
if the Participant is age 70 1/2. See the WHEN BENEFITS START SECTION of Article V.

 

Owner-employee means a Self-employed
Individual who, in the case of a sole proprietorship, owns the entire interest
in the unincorporated trade or business for which this Plan is established. If
this Plan is established for a partnership, an Owner-employee means a
Self-employed Individual who owns more than 10 percent of either the capital
interest or profits interest in such partnership.

 

Parental Absence means an Employee’s absence
from work:

 

(a)                                  by reason of
pregnancy of the Employee,

 

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

 

15

 

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

 

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

 

Participant means either an Active
Participant or an Inactive Participant. Period of Military Duty means, for an
Employee who served as a member of the armed forces of the United States, and

 

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

 

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

 

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

 

Plan Administrator means the person or
persons who administer the Plan. The Plan Administrator is the Employer.

 

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

 

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

 

Predecessor Employer means a firm of which
the Employer was once a part (e.g., due to a spinoff or change of corporate
status) or a firm absorbed by the Employer because of a merger or acquisition
(stock or asset, including a division or an operation of such company).

 

Primary Employer means GOVERNMENT TECHNOLOGY
SERVICES, INC.

 

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

 

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

 

16

 

Qualified Nonelective Contributions means
contributions made by the Employer to fund this Plan (other than Elective
Deferral Contributions) which are 100% vested and subject to the distribution
restrictions of Code Section 401(k) when made. See the EMPLOYER
CONTRIBUTIONS SECTION of Article III and the WHEN BENEFITS START SECTION of
Article V.

 

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

 

Quarterly Date means each Yearly Date and the
third, sixth, and ninth Monthly Date after each Yearly Date which is within the
same Plan Year.

 

Reentry Date means the date a former Active
Participant reenters the Plan. See the ACTIVE PARTICIPANT SECTION of Article 11.

 

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

 

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

 

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

 

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

 

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

 

Trust Fund means the total funds held under
the Trust Agreement.

 

Trustee means the party or parties named in
the Trust Agreement. The term Trustee as it is used in this Plan is deemed to
include the plural unless the context clearly indicates the singular is meant.

 

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

 

17

 

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

 

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

 

If the Participant’s Vesting Percentage is
less than 100%, his Vested Account equals the sum of (a) and (b) below: 

 

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

 

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

 

If the Participant has withdrawn any part of
his Account resulting from Employer Contributions, other than the vested
Employer Contributions included in (a) above, the amount determined under this
subparagraph (b) shall be equal to

P(AB + D) - D as defined below:

 

                                                ©
The Participant’s Vesting Percentage.

 

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

 

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

 

The Participant’s Vested Account is
nonforfeitable.

 

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

 

Vesting Computation Period means a
consecutive 12-month period ending on the last day of each Plan Year, including
corresponding consecutive 12-month periods before April 1, 1991.

 

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

 

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

 

18

 

	
  VESTING SERVICE

  	
   

  	
  VESTING

  PERCENTAGE

  	
   

  
	
  (whole years)

  	
   

  	
   

  	
   

  
	
  Less than 1

  	
   

  	
  0

  	
   

  
	
  1

  	
   

  	
  20

  	
   

  
	
  2

  	
   

  	
  40

  	
   

  
	
  3

  	
   

  	
  60

  	
   

  
	
  4

  	
   

  	
  80

  	
   

  
	
  5 or more

  	
   

  	
  100

  	
   

  

 

The Vesting Percentage for a Participant who
is an Employee on or after the date he reaches Normal Retirement Age or Early
Retirement Age shall be 100%. The Vesting Percentage for a Participant who is
an Employee on the date he becomes Totally and Permanently Disabled or dies
shall be 100%.

 

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

 

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

 

However, Vesting Service is modified as
follows: Period of Military Duty included:

 

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

 

Controlled Group service included:

 

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

 

Yearly Date means April 1, 1991, and
each following January 1.

 

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

 

19

 

ARTICLE II

 

PARTICIPATION

 

SECTION 2.01—ACTIVE
PARTICIPANT.

 

(a)                                  An
Employee shall first become an Active Participant (begin active participation
in the Plan) on the earliest Monthly Date on which he is an Eligible Employee
and has met the eligibility requirement set forth below. This date is his Entry
Date.

 

(1)                                  He is
age 21 or older.

 

Each Employee who was an Active Participant
under the Plan on December 31, 1996, shall continue to be an Active
Participant if he is still an Eligible Employee on January 1, 1997, and
his Entry Date shall not change.

 

If a person has been an Eligible Employee who
has met all of the eligibility requirements above, but is not an Eligible
Employee on the date which would have been his Entry Date, he shall become an
Active Participant on the date he again becomes an Eligible Employee. This date
is his Entry Date.

 

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

 

(b)                                 An
Inactive Participant shall again become an Active Participant (resume active
participation in the Plan) on the date he again performs an Hour-of-Service as
an Eligible Employee. This date is his Reentry Date.

 

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

 

(c)                                  A
former Participant shall again become an Active Participant (resume active
participation in the Plan) on the date he again performs an Hour-of-Service as
an Eligible Employee. This date is his Reentry Date.

 

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

 

SECTION 2.02—INACTIVE
PARTICIPANT.

 

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

 

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

 

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

 

20

 

An Employee or former Employee who was an
Inactive Participant under the Plan on December 31, 1996, shall continue
to be an Inactive Participant on January 1, 1997. Eligibility for any
benefits payable to the Participant or on his behalf and the amount of the
benefits shall be determined according to the provisions of the prior document,
unless otherwise stated in this document.

 

SECTION 2.03—CESSATION
OF PARTICIPATION.

 

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

 

21

 

ARTICLE III 

 

CONTRIBUTIONS

 

SECTION 3.01—EMPLOYER
CONTRIBUTIONS.

 

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

 

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

 

The elective deferral agreement to start or
modify Elective Deferral Contributions shall be effective on the first day of
the first pay period following the pay period in which the Participant’s Entry
Date (Reentry Date, if applicable) or any following Quarterly Date occurs. The
elective deferral agreement must be entered into on or before the date it is
effective.

 

The elective deferral agreement to stop
Elective Deferral Contributions may be entered into on any date. Such elective
deferral agreement shall be effective on the first day of the pay period
following the pay period in which the elective deferral agreement is entered
into.

 

Elective Deferral Contributions must be a
whole percentage of Compensation and cannot be less than 1% nor more than 15%
of Compensation for the pay period.

 

Elective Deferral Contributions are fully
(100%) vested and nonforfeitable.

 

(b)                                 The
Employer may make discretionary Matching Contributions. The percentage of
Elective Deferral Contributions matched, if any, shall be a percentage as
determined by the Employer. If the Employer makes a Matching Contribution, the
percentage of Elective Deferral Contributions matched shall not be more than
100%.

 

Matching Contributions are calculated based
on Elective Deferral Contributions and Compensation for the Plan Year. Matching
Contributions shall be made for all persons who meet the allocation
requirements of the ALLOCATION SECTION of this article.

 

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

 

Matching Contributions are fully (100%)
vested and nonforfeitable.

 

22

 

(c)                                  Qualified Nonelective
Contributions may be made for each Plan Year in an amount determined by the
Employer.

 

Qualified Nonelective Contributions are 100%
vested and subject to the distribution restrictions of Code Section 401(k) when
made.

 

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

 

Discretionary Contributions are subject to
the Vesting Percentage.

 

No Participant shall be permitted to have
Elective Deferral Contributions, as defined in the EXCESS AMOUNTS SECTION of
this article, made under this Plan, or any other qualified plan maintained by
the Employer, during any taxable year, in excess of the dollar limitation
contained in Code Section 402(g) in effect at the beginning of such
taxable year.

 

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

 

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

 

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

 

SECTION 3.01A—ROLLOVER
CONTRIBUTIONS.

 

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

 

(a)                                  The
Contribution is of amounts distributed from a plan that satisfies the
requirements of Code Section 401(a) or from a “conduit” individual
retirement account described in Code Section 408(d)(3)(A). In the case of
an Inactive Participant, the Contribution must be of an amount distributed from
another plan of the Employer, or a plan of a Controlled Group member, that
satisfies the requirements of Code Section 401(a).

 

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

 

23

 

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

 

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

 

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

 

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

 

Rollover
Contributions made by an Eligible Employee or an Inactive Participant shall be
credited to his Account. The part of the Participant’s Account resulting from
Rollover Contributions is fully (100%) vested and nonforfeitable at all times.
A separate accounting record shall be maintained for that part of his Rollover
Contributions consisting of voluntary contributions which were deducted from
the Participant’s gross income for Federal income tax purposes.

 

SECTION 3.02—FORFEITURES.

 

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

 

(a)                                  the
date the Participant dies (if prior to such date he had ceased to be an
Employee), or

 

(b)                                 the
Participant’s Forfeiture Date.

 

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

 

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

 

Forfeitures
shall be determined at least once during each Plan Year. Forfeitures may first
be used to pay administrative expenses. Forfeitures of Matching Contributions
which relate to excess amounts as provided in the EXCESS AMOUNTS SECTION of
this article, which have not been used to pay administrative

 

24

 

expenses, shall be applied to reduce the earliest Employer
Contributions made after the Forfeitures are determined. Any other Forfeitures
which have not been used to pay administrative expenses shall be applied to
reduce the earliest Employer Contributions made after the Forfeitures are
determined. Upon their application to reduce Employer Contributions,
Forfeitures shall be deemed to be Employer Contributions.

 

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

 

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

 

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

 

SECTION 3.03—ALLOCATION.

 

A person meets the allocation requirements of
this section if he is an Active Participant on the last day of the Plan
Year and has at least 1,000 Hours-of-Service during the latest Accrual
Computation Period ending on or before that date.

 

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

 

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

 

Qualified
Nonelective Contributions shall be allocated as of the last day of the Plan
Year to each person who was an Active Participant on the last day of the Plan
Year. Such Qualified Nonelective

 

25

 

Contributions shall be allocated only to Nonhighly Compensated
Employees. The amount allocated to such person for the Plan Year shall be equal
to such Qualified Nonelective Contributions multiplied by the ratio of such
person’s Annual Compensation for the Plan Year to the total Annual Compensation
of all such persons. This amount shall be credited to the person’s Account.

 

Discretionary
Contributions shall be allocated as of the last day of the Plan Year using
Annual Compensation for the Plan Year. The amount allocated shall be determined
as follows:

 

STEP ONE: The
allocation in this step one shall be made to each person meeting the allocation
requirements of this section and each person who is entitled to a minimum
contribution under the MODIFICATION OF CONTRIBUTIONS SECTION of Article XI.
Each such person’s allocation shall be an amount equal to the Discretionary
Contributions multiplied by the ratio of such person’s Annual Compensation to
the total Annual Compensation of all such persons. Such amount shall not exceed
3% of such person’s Annual Compensation. The allocation for any person who does
not meet the allocation requirements of this section shall be limited to
the amount necessary to fund the minimum contribution.

 

STEP TWO: The
allocation in this step two shall be made to each person meeting the allocation
requirements of this section. Each such person’s allocation shall be equal to
any amount remaining after the allocation in step one multiplied by the ratio
of such person’s Annual Compensation to the total Annual Compensation of all
such persons.

 

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

 

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

 

SECTION 3.04—CONTRIBUTION
LIMITATION.

 

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

 

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

 

(1)                                  employer
contributions;

 

(2)                                  employee
contributions; and

 

(3)                                  forfeitures.

 

Annual Additions to a defined contribution
plan shall also include the following:

 

(4)                                  amounts
allocated, after March 31, 1984, to an individual medical account, as defined
in Code Section 415(l)(2), which are part of a pension or annuity
plan maintained by the Employer,

 

26

 

(5)                                  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

 

(6)                                  allocations
under a simplified employee pension.

 

For this purpose, any Excess Amount applied
under (e) below in the Limitation Year to reduce Employer Contributions shall
be considered Annual Additions for such Limitation Year.

 

Compensation means 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 employment or the services
performed (such as the exception for agricultural labor in Code Section 3401
(a)(2)).

 

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

 

For purposes of applying the limitations of this
section, Compensation for a Limitation Year is the Compensation actually paid
or made available in gross income during such Limitation Year.

 

For Limitation Years beginning after December 31,
1997, for purposes of applying the limitations of this section, Compensation
paid or made available during such Limitation Year 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 Employee and
which is not includible in the gross income of the Employee by reason of Code Section 125,
132(f)(4), or 457.

 

Defined Benefit Plan Fraction means a
fraction, the numerator of which is the sum of the Participant’s 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 (i)
125 percent of the dollar limitation determined for the Limitation Year under
Code Sections 415(b)(1 )(A) and (d) or (ii) 140 percent of the Highest Average
Compensation, including any adjustments under Code Section 415(b)(5).

 

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 125 percent of the sum of the annual benefits
under such plans which the Participant had accrued as 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.

 

Defined Contribution Dollar Limitation means,
for Limitation Years beginning after December 31, 1994, $30,000, as
adjusted under Code Section 415(d).

 

27

 

Defined Contribution Plan Fraction means a
fraction, the numerator of which is the sum of the Annual Additions to the
Participant’s account 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 employee contributions to all defined benefit plans, whether or
not terminated, maintained by the Employer, and the Annual Additions
attributable to all welfare benefit funds, individual medical accounts, and
simplified employee pensions, maintained by the Employer), and the denominator
of which is the sum of the maximum aggregated amounts for the current and all
prior Limitation Years of 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 (i) 125 percent of the
dollar limitation under Code Section 415(c)(1)(A) after adjustment under
Code Section 415(d) or (ii) 35 percent of the Participant’s Compensation
for such year.

 

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 6, 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 (i) the excess of the sum of the fractions over
1.0 times (ii) the denominator of this fraction, will be permanently subtracted
from the numerator of this fraction. The adjustment is calculated using the
fractions as they would 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.

 

The Annual Addition for any Limitation Year
beginning before January 1, 1987, shall not be recomputed to treat all
employee contributions as Annual Additions.

 

Employer means the employer that adopts this
Plan, and all members of a controlled group of corporations (as defined in Code
Section 414(b) as modified by Code Section 415(h)), all commonly
controlled trades or businesses (as defined in Code Section 415(c) as
modified by Code Section 415(h)) or affiliated service groups (as defined
in Code Section 414(m)) of which the adopting employer is a part, and any
other entity required to be aggregated with the employer pursuant to
regulations under Code Section 414(0).

 

Excess Amount means the excess of the
Participant’s Annual Additions for the Limitation Year over the Maximum
Permissible Amount.

 

Highest Average Compensation means the
average Compensation for the three consecutive Limitation Years while he was an
Employee (actual consecutive Limitation Years while he was an Employee, if
employed less than three years) that produces the highest average.

 

Limitation Year means the consecutive
12-month period ending on each December 31. It the Limitation Year is
other than the calendar year, execution of this Plan (or any amendment to this
Plan changing the Limitation Year) constitutes the Employer’s adoption of a
written resolution electing the Limitation Year. If the Limitation Year is
amended to a different consecutive 12-month period, the new Limitation Year
must begin on a date within the Limitation Year in which the amendment is made.

 

28

 

Maximum Permissible Amount means the maximum
Annual Addition that may be contributed or allocated to a Participant’s Account
under the Plan for any Limitation Year. This amount shall not exceed the lesser
of:

 

(1)                                  The
Defined Contribution Dollar Limitation, or

 

(2)                                  25
percent of the Participant’s Compensation for the Limitation Year.

 

The compensation limitation referred to in (2)
shall not apply to any contribution for medical benefits (within the meaning of
Code Section 401(h) or 419A(f)(2)) which is otherwise treated as an Annual
Addition under Code Section 415(l)(1) or 419A(d)(2).

 

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

 

Number of months in the short
Limitation Year

12

 

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:

 

(1)                                  the
Participant will continue employment until normal retirement age under the plan
(or current age, if later), and

 

(2)                                  the
Participant’s 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.

 

(b)                                 If
the 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 an Annual Addition, the amount of
Annual Additions which may be credited to the Participant’s Account for any
Limitation Year shall not exceed the lesser of the Maximum Permissible Amount
or any other limitation contained in this Plan. If the Employer Contribution
that would otherwise be contributed or allocated to the Participant’s Account
would cause the Annual Additions for the Limitation Year to exceed the Maximum
Permissible Amount, the amount contributed or allocated shall be reduced so
that the Annual Additions for the Limitation Year will equal the Maximum
Permissible Amount.

 

(c)                                  Prior
to determining the Participant’s actual 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 Compensation for the
Limitation Year, uniformly determined for all Participants similarly situated.

 

29

 

(d)                                 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 Compensation for the Limitation Year.

 

(e)                                  If
a reasonable error in estimating a Participant’s Compensation for the
Limitation Year, a reasonable error in determining the amount of elective
deferrals (within the meaning of Code Section 402(g)(3)) that may be made
with respect to any individual under the limits of Code Section 415, or
under other facts and circumstances allowed by the Internal Revenue Service,
there is an Excess Amount, the excess will be disposed of as follows:

 

(1)                                  Any
Elective Deferral Contributions (plus attributable earnings), to the extent
they would reduce the Excess Amount, will be distributed to the Participant.
Concurrently with the distribution of such Elective Deferral Contributions, any
Matching Contributions which relate to any Elective Deferral Contributions
distributed in the preceding sentence, to the extent such application would
reduce the Excess Amount, will be applied as provided in (2) or (3) below:

 

(2)                                  If
after the application of (1) above 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 for such Participant in the next Limitation Year, and each
succeeding Limitation Year if necessary.

 

(3)                                  If
after the application of (1) above an Excess Amount still exists, and the
Participant is not covered by the Plan at the end of the Limitation Year, the
Excess Amount will be held unallocated in a suspense account. The suspense
account will be applied to reduce future Employer Contributions for all
remaining Participants in the next Limitation Year, and each succeeding
Limitation Year if necessary.

 

(4)                                  If
a suspense account is in existence at any time during a Limitation Year
pursuant to this (e), it will participate in the allocation of investment gains
or losses. 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 Participant’s Accounts before any Employer
Contributions may be made to the Plan for that Limitation Year. Excess Amounts
held in a suspense account may not be distributed to Participants or former
Participants.

 

(f)                                    This
(f) applies if, in addition to this Plan, the Participant is covered under
another qualified defined contribution plan maintained by the Employer, a
welfare benefit fund maintained by the Employer, an individual medical account
maintained by the Employer, or a simplified employee pension maintained by the
Employer which provides an Annual Addition during any Limitation Year. The
aggregate Annual Additions under all such qualified defined contribution plans,
welfare benefit funds, individual medical accounts, and simplified employee
pensions for the Limitation Year will not exceed the Maximum Permissible
Amount. Any reduction necessary shall be made first to the profit sharing
plans, then to all other such qualified defined contribution plans and welfare
benefit funds, individual medical accounts, and simplified employee pensions
and, if necessary, by reducing first those that were most recently allocated.
Simplified employee pensions shall be deemed to be allocated first, followed by
welfare benefit funds and individual medical accounts. However, elective
deferral contributions shall be the last

 

30

 

contributions reduced before the simplified
employee pension, welfare benefit fund, or individual medical account is
reduced.

 

(g)                                 If
the Employer maintains, or at any time maintained, a qualified defined benefit
plan covering any Participant in this Plan, the sum of the Participant’s
Defined Benefit Plan Fraction and Defined Contribution Plan Fraction will not
exceed 1.0 in any Limitation Year. The Projected Annual Benefit shall be
limited first. If the Participant’s annual benefit(s) equal his Projected
Annual Benefit, as limited, then Annual Additions to the defined contribution
plan(s) shall be limited to the extent needed to reduce the sum to 1.0 in the
same manner in which the Annual Additions are limited to meet the Maximum
Permissible Amount. This subparagraph shall cease to apply effective as of the
first Limitation Year beginning on or after January 1, 2000.

 

SECTION 3.05—EXCESS
AMOUNTS.

 

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

 

ACP means the average (expressed as a
percentage) of the Contribution Percentages of the Eligible Participants in a
group.

 

APP means the average (expressed as a
percentage) of the Deferral Percentages of the Eligible Participants in a
group.

 

Aggregate Limit means the greater of:

 

(1)                                  The
sum of:

 

(i)            125
percent of the greater of the ADP of the Nonhighly Compensated Employees for
the prior Plan Year or the ACP of the Nonhighly Compensated Employees 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 percent or 2 percent plus the lesser of such ADP or ACP.

 

(2)                                  The
sum of:

 

(i)            125
percent of the lesser of the ADP of the Nonhighly Compensated Employees for the
prior Plan Year or the ACP of the Nonhighly Compensated Employees 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 percent or 2 percent plus the greater of such ADP or ACP.

 

If the Employer has elected to use the
current testing method, then, in calculating the Aggregate Limit for a
particular Plan Year, the Nonhighly Compensated Employees’ ADP and ACP for that
Plan Year, instead of the prior Plan Year, is used.

 

Contribution Percentage means the ratio
(expressed as a percentage) of the Eligible Participant’s Contribution
Percentage Amounts to the Eligible Participant’s Compensation for the Plan Year

 

31

 

(whether or not the Eligible Participant was
an Eligible Participant for the entire Plan Year). For an Eligible Participant
for whom such Contribution Percentage Amounts for the Plan Year are zero, the
percentage is zero.

 

Contribution Percentage Amounts means the sum
of the Participaht Contributions and Matching Contributions (that are not
Qualified Matching Contributions taken into account for purposes of the ADP
Test) made under the Plan on behalf of the Eligible Participant for the Plan
Year. Such Contribution Percentage Amounts shall not include Matching
Contributions that are forfeited either to correct Excess Aggregate
Contributions or because the Contributions to which they relate are Excess
Elective Deferrals, Excess Contributions, or Excess Aggregate Contributions.
Under such rules as the Secretary of the Treasury shall prescribe, in
determining the Contribution Percentage the Employer may elect to include
Qualified Nonelective Contributions under this Plan which were not used in
computing the Deferral Percentage. The Employer may also elect to use Elective
Deferral Contributions in computing the Contribution Percentage so long as the
ADP Test is met before the Elective Deferral Contributions are used in the ACP
Test and continues to be met following the exclusion of those Elective Deferral
Contributions that are used to meet the ACP Test.

 

Deferral Percentage means the ratio
(expressed as a percentage) of Elective Deferral Contributions under this Plan
on behalf of the Eligible Participant for the Plan Year to the Eligible
Participant’s Compensation for the Plan Year (whether or not the Eligible
Participant was an Eligible Participant for the entire Plan Year). The Elective
Deferral Contributions used to determine the Deferral Percentage shall include
Excess Elective Deferrals (other than Excess Elective Deferrals of Nonhighly
Compensated Employees that arise solely from Elective Deferral Contributions
made under this Plan or any other plans of the Employer or a Controlled Group
member), but shall exclude Elective Deferral Contributions that are used in
computing the Contribution Percentage (provided the ADP Test is satisfied both
with and without exclusion of these Elective Deferral Contributions). Under
such rules as the Secretary of the Treasury shall prescribe, the Employer may
elect to include Qualified Nonelective Contributions and Qualified Matching
Contributions under this Plan in computing the Deferral Percentage. For an Eligible
Participant for whom such contributions on his behalf for the Plan Year are
zero, the percentage is zero.

 

Elective Deferral Contributions means any
employer contributions made to a plan at the election of a participant, in lieu
of cash compensation, and shall include contributions made pursuant to a salary
reduction agreement or other deferral mechanism. With-respect—to—any taxable
year, a participant’s Elective Deferral Contributions are the sum of all
employer contributions made on behalf of such participant pursuant to an
election to defer under any qualified cash or deferred arrangement described in
Code Section 401(k), any salary reduction simplified employee pension plan
described in Code Section 408(k)(6), any SIMPLE IRA plan described in Code
Section 408(p), any eligible deferred compensation plan under Code Section 457,
any plan described under Code Section 501 (c)(18), and any employer
contributions made on behalf of a participant for the purchase of an annuity
contract under Code Section 403(b) pursuant to a salary reduction
agreement. Elective Deferral Contributions shall not include any deferrals
properly distributed as excess annual additions.

 

Eligible Participant means, for purposes of
determining the Deferral Percentage, any Employee who is otherwise entitled to
make Elective Deferral Contributions under the terms of the Plan for the Plan
Year. Eligible Participant means, for purposes of determining the Contribution

 

32

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

Excess Elective Deferrals means those
Elective Deferral Contributions that are includible in a Participant’s gross
income under Code Section 402(g) to the extent such Participant’s Elective
Deferral Contributions for a taxable year exceed the dollar
limitation-under—such Code section. Excess Elective Deferrals shall be treated
as Annual Additions, as defined in the CONTRIBUTION LIMITATION SECTION of this
article, under the Plan, unless such amounts are distributed no later than the
first April 15 following the close of the Participant’s taxable year.

 

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

 

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

 

33

 

Qualified Matching Contributions means
Matching Contributions which are subject to the distribution and
nonforfeitability requirements under Code Section 401 (k) when made.

 

Qualified Nonelective Contributions means any
employer contributions (other than Matching Contributions) which an employee
may not elect to have paid to him in cash instead of being contributed to the
plan and which are subject to the distribution and nonforfeitability
requirements under Code Section 401 (k) when made.

 

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

 

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

 

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

 

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

 

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

 

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

 

34

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

If the Employer has elected to use the
current year testing method, that election cannot be changed unless (i) the
Plan has been using the current year testing method for the preceding five Plan
Years, or if less, the number of Plan Years the Plan has been in existence; or
(ii) the Plan otherwise meets one of the conditions specified in Internal
Revenue Service Notice 98-1 (or superseding guidance) for changing from the
current year testing method.

 

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

 

35

 

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

 

In the event this Plan satisfies the
requirements of Code Section 401(k), 401 (a) (4), or 410(b) only if
aggregated with one or more other plans, or if one or more other plans satisfy
the requirements of such Code sections only if aggregated with this Plan, then
this section shall be applied by determining the Deferral Percentage of
Employees as if all such plans were a single plan. Any adjustments to the
Nonhighly Compensated Employee ADP for the prior year shall be made in
accordance with Internal Revenue Service Notice 98-1 (or superseding guidance),
unless the Employer has elected 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 testing method for the ADP Test.

 

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

 

The Employer shall maintain records
sufficient to demonstrate satisfaction of the ADP Test and the amount of
Qualified Nonelective Contributions or Qualified Matching Contributions, or
both, used in such test.

 

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

 

Notwithstanding any other provisions of this
Plan, Excess Contributions, plus any income and minus any loss allocable
thereto, shall be distributed no later than the last day of each Plan Year to
Participants to whose Accounts such Excess Contributions were allocated for the
preceding Plan Year. Excess Contributions are allocated to the Highly
Compensated Employees with the largest amounts of employer contributions taken
into account in calculating the ADP Test for the year in which the excess
arose, beginning with the Highly Compensated Employee with the largest amount
of such employer contributions and continuing in descending order until all of
the Excess Contributions have been allocated. for purposes of the preceding
sentence, the “largest amount” is determined after distribution of any Excess
Contributions. If such excess amounts are distributed more than 2 1/2 months
after the last day of the Plan Year in which such excess amounts arose, a 10
percent excise tax shall be imposed on the employer maintaining the plan with
respect to such amounts.

 

36

 

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

 

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

 

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

 

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

 

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

 

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

 

(i)            The
ACP for the Plan Year for Eligible Participants who are Highly Compensated
Employees for the Plan Yearshall not—exceed the prior year’s ACP for Eligible
Participants who were Nonhighly Compensated Employees for the prior Plan 1’aar
multiplied by 1.25; or

 

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

 

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

 

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

 

If this is not a successor plan, for the
first Plan Year the Plan permits any Participant to make Participant
Contributions, provides for Matching Contributions, or both, for purposes

 

37

 

of the foregoing tests, the prior year’s
Nonhighly Compensated Employees’ ACP shall be 3 percent, unless the Employer
has elected to use the Plan Year’s ACP for these Eligible Participants.

 

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

 

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

 

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

 

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

 

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

 

If the Employer has elected to use the
current year testing method, that election cannot be changed unless (i) the
Plan has been using the current year testing method for the preceding five Plan
Years, or if less, the number of Plan Years the Plan has been in existence; or
(ii) the Plan otherwise meets one of the conditions specified in Internal
Revenue Service Notice 98-1 (or superseding guidance) for changing from the
current year testing method.

 

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

 

Multiple Use. If one or more Highly Compensated
Employees participate in both a cash or deferred arrangement and a plan subject
to the ACP Test maintained by the Employer or a Controlled Group member, and
the sum of the ADP and ACP of those Highly Compensated Employees subject to
either or both tests exceeds the Aggregate Limit, then the Contribution
Percentage of those Highly Compensated Employees who also participate in a cash
or deferred arrangement will be reduced in the manner described below for
allocating Excess Aggregate Contributions so that the limit is not exceeded.
The amount by which each Highly Compensated Employee’s Contribution Percentage
is reduced shall be treated as an Excess Aggregate Contribution. The ADP and
ACP of the Highly Compensated Employees are determined after any corrections
required to meet the ADP Test and ACP Test 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 Highly Compensated Employees does not exceed 1.25
multiplied by the ADP and ACP, respectively, of the Nonhighly Compensated
Employees.

 

38

 

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

 

In the event this Plan satisfies the requirements
of Code Section 401(m), 401(a)(4), or 410(b) only if aggregated with one
or more other plans, or if one or more other plans satisfy the requirements of
such Code sections only if aggregated with this Plan, then this section shall
be applied by determining the Contribution Percentage of Employees as if all
such plans were a single plan. Any adjustments to the Nonhighly Compensated
Employee RCP for the prior year shall be made in accordance with Internal
Revenue Service Notice 98-1 (or superseding guidance), unless the Employer has
elected to use the current year testing method. Plans may be aggregated in
order to satisfy Code Section 401 (m) only if they have the same plan year
and use the same testing method for the ACP Test.

 

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

 

The Employer shall maintain records.
sufficient to demonstrate satisfaction of the ACP Test and the amount of
Qualified Nonelective Contributions or Qualified Matching Contributions, or
both, used in such test.

 

Notwithstanding any other provisions of this
Plan, Excess Aggregate Contributions, plus any income and minus any loss
allocable thereto, shall be forfeited, if not vested, or distributed, if
vested, no later than the last day of each Plan Year to Participants to whose
Accounts such Excess Aggregate Contributions were allocated for the preceding
Plan Year. Excess Aggregate Contributions are allocated to the Highly
Compensated Employees with the largest Contribution Percentage Amounts taken
into account in calculating the ACP Test for the year in which the excess
arose, beginning with the Highly Compensated Employee with the largest amount
of such Contribution Percentage Amounts and continuing in descending order until
all of the Excess Aggregate Contributions have been allocated. For purposes of
the preceding sentence, the “largest amount” is determined after distribution
of any Excess Aggregate Contributions. If such Excess Aggregate Contributions
are distributed more than 2 1/2 months after the last day of the Plan Year in
which such excess amounts arose, a 10 percent excise tax shall be imposed on
the employer maintaining the plan with respect to such amounts.

 

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

 

39

 

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

 

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

 

(e)                                  Employer
Elections. The Employer has not made an election to use the current year
testing method.

 

40

 

ARTICLE IV

 

INVESTMENT OF CONTRIBUTIONS

 

SECTION 4.01—INVESTMENT AND TIMING OF CONTRIBUTIONS.

 

The handling of Contributions is governed by
the provisions of the Trust Agreement, the Annuity Contract, and any other
funding arrangement in which the Plan Fund is or may be held or invested. To
the extent permitted by the Trust Agreement, Annuity Contract, or other funding
arrangement, the parties named below shall direct the Contributions to the
guaranteed benefit policy portion of the Annuity Contract, any of the
investment options available under the Annuity Contract, or any of the
investment vehicles available under the Trust Agreement and may request the
transfer of amounts resulting from those Contributions between such investment
options and investment vehicles or the transfer of amounts between the
guaranteed benefit policy portion of the Annuity Contract and such investment
options and investment vehicles. A Participant may not direct the Trustee or
Insurer to invest the Participant’s Account in collectibles. Collectibles mean
any work of art, rug or antique, metal or gem, stamp or coin, alcoholic
beverage, or other tangible personal property specified by the Secretary of the
Treasury. However, for tax years beginning after December 31, 1997,
certain coins and bullion as provided in Code Section 408(m)(3) shall not
be considered collectibles. To the extent that a Participant who has investment
direction fails to give timely direction, the Primary Employer shall direct the
investment of his Account, If the Primary Employer has investment direction,
such Account shall be invested ratably in the guaranteed benefit policy portion
of the Annuity Contract, the investment options available under the Annuity
Contract, or the investment vehicles available under the Trust Agreement in the
same manner as the Accounts of all other Participants who do not direct their
investments. The Primary Employer shall have investment direction for amounts
which have not been allocated to Participants. To the extent an investment is
no longer available, the Primary Employer may require that amounts currently
held in such investment be reinvested in other investments.

 

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

 

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

 

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

 

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

 

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

 

41

 

The Employer
shall pay to the Insurer or Trustee, as applicable, the Elective Deferral
Contributions and Qualified Nonelective Contributions for each Plan Year not
later than the end of the 12-month period immediately following the Plan Year
for which they are deemed to be paid.

 

All Contributions are forwarded by the
Employer to the Trustee to be deposited in the Trust Fund or to the Insurer to
be deposited under the Annuity Contract, as applicable. Contributions that are
accumulated through payroll deduction shall be paid to the Trustee or Insurer,
as applicable, by the earlier of (i) the date the Contributions can reasonably
be segregated from the Employer’s assets, or (ii) the 15th business day of the
month following the month in which the Contributions would otherwise have been
paid in cash to the Participant.

 

42

 

ARTICLE V 

 

BENEFITS

 

SECTION 5.01—RETIREMENT
BENEFITS.

 

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

 

SECTION 5.02—DEATH
BENEFITS.

 

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

 

SECTION 5.03—VESTED
BENEFITS.

 

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

 

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

 

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

 

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

 

SECTION 5.04—WHEN
BENEFITS START.

 

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

 

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

 

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

 

43

 

(3)                                  The
date the Participant ceases to be an Employee.

 

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

 

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

 

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

 

(b)                                 The
Participant’s Vested Account which results from Elective Deferral Contributions
and Qualified Nonelective Contributions may not be distributed to a Participant
or to his Beneficiary (or Beneficiaries) in accordance with the Participant’s
or Beneficiary’s (or Beneficiaries’) election, earlier than separation from
service, death, or disability. Such amount may also be distributed upon:

 

	
  (1)

  	
   

  	
  Termination
  of the Plan, as permitted in Article VIII.

  
	
   

  	
   

  	
   

  
	
  (2)

  	
   

  	
  The
  disposition by the Employer, if the Employer is a corporation, to an
  unrelated corporation of substantially all of the assets, within the meaning
  of Code Section 409(d)(2), used in a trade or business of the Employer
  if the Employer continues to maintain the Plan after the disposition, but
  only with respect to Employees who continue employment with the corporation
  acquiring such assets.

  
	
   

  	
   

  	
   

  
	
  (3)

  	
   

  	
  The
  disposition by the Employer, if the Employer is a corporation, to an
  unrelated entity of the Employer’s interest in a subsidiary, within the
  meaning of Code Section 409(d)(3), if the Employer continues to maintain
  the Plan, but only with respect to Employees who continue employment with
  such subsidiary.

  
	
   

  	
   

  	
   

  
	
  (4)

  	
   

  	
  The
  attainment of age 59 1/2 as permitted in the WITHDRAWAL BENEFITS
  SECTION of this article.

  
	
   

  	
   

  	
   

  
	
  (5)

  	
   

  	
  The hardship
  of the Participant as permitted in the WITHDRAWAL BENEFITS SECTION of
  this article.

  

 

All distributions that may be made pursuant
to one or more of the foregoing distributable events will be a retirement
benefit and shall be distributed to the Participant according to the
distribution of benefit provisions of Article VI. In addition,
distributions that are triggered by (1),

 

44

 

(2) and (3) above must be made in a lump sum. A
lump sum shall include a distribution of an annuity contract.

 

SECTION 5.05—WITHDRAWAL
BENEFITS.

 

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

 

Elective Deferral Contributions Matching
Contributions

 

Qualified Nonelective Contributions
Discretionary Contributions Rollover Contributions

 

A Participant may make
only two such withdrawals in any 12-month period.

 

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

 

Elective Deferral Contributions Matching
Contributions Discretionary Contributions Rollover Contributions

 

In the event of hardship due to
an immediate and heavy financial need. Withdrawals from the Participant’s
Account resulting from Elective Deferral Contributions shall be limited to the
amount of the Participant’s Elective Deferral Contributions. Immediate and
heavy financial need shall be limited to: (i) expenses incurred or necessary
for medical care, described in Code Section 213(d), of the Participant,
the Participant’s spouse, or any dependents of the Participant (as defined in
Code Section 152); (ii) purchase (excluding mortgage payments) of a
principal residence for the Participant; (iii) payment of tuition, related
educational fees, and room and board expenses, for the next 12 months of
post-secondary education for the Participant, his spouse, children, or
dependents; (iv) the need to prevent the eviction of the Participant from his
principal residence or foreclosure on the mortgage of the Participant’s
principal residence; or (v) any other distribution which is deemed by the
Commissioner of Internal Revenue to be made on account of immediate and heavy
financial need as provided in Treasury regulations.

 

No withdrawal
shall be allowed which is not necessary to satisfy such immediate and heavy
financial need. Such withdrawal shall be deemed necessary only if all of the
following requirements are met: (i) the distribution is not in excess of the
amount of the immediate and heavy financial need (including amounts necessary
to pay any Federal, state, or local income taxes or penalties reasonably
anticipated to result from the distribution); (ii) the Participant has obtained
all distributions, other than hardship distributions, and all nontaxable loans
currently available under all plans maintained by the Employer; (iii) the Plan,
and all other plans maintained by the Employer, provide that the Participant’s
elective contributions and participant contributions will be suspended for at
least 12 months after receipt of the hardship distribution; and (iv) the Plan,
and all other plans maintained by the Employer, provide that the Participant
may not make elective contributions 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 contributions for the
taxable year of the hardship distribution. The Plan

 

45

 

will suspend elective contributions and participant contributions for
12 months and limit elective deferrals as provided in the preceding sentence. A
Participant shall not cease to be an Eligible Participant, as defined in the
EXCESS AMOUNTS SECTION of Article III, merely because his elective
contributions or participant contributions are suspended.

 

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

 

SECTION 5.06—LOANS
TO PARTICIPANTS.

 

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

 

No loans will be made to any
shareholder-employee or Owner-employee. For purposes of this requirement, a
shareholder-employee means an employee or officer of an electing small business
(Subchapter S) corporation who owns (or is considered as owning within the
meaning of Code Section 318(a)(1)), on any day during the taxable year of
such corporation, more than 5 percent of the outstanding stock of the
corporation.

 

A loan to a Participant
shall be a Participant-directed investment of his Account. The loan is a Trust
Fund investment but no Account other than the borrowing Participant’s Account
shall share in the interest paid on the loan or bear any expense or loss
incurred because of the loan.

 

The number of
outstanding loans shall be limited to one. No more than one loan shall be
approved for any Participant in any 1 2-month period. The minimum amount of any
loan shall be $1,000.

 

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

 

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

 

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

 

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

 

(1)                                  One-half
of the Participant’s Vested Account.

 

(2)                                  $10,000.

 

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

 

46

 

For purposes of this maximum, a Participant’s Vested Account does not
include any accumulated deductible employee contributions, as defined in Code Section 72(o)(5)(B),
and all qualified employer plans, as defined in Code Section 72(p)(4), of
the Employer and any Controlled Group member shall be treated as one plan.

 

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

 

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

 

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

 

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

 

The loan shall
by its terms require that repayment (principal and interest) be amortized in
level payments, not less frequently than quarterly, over a period not extending
beyond five years from the date of the loan. If the loan is used to acquire a
dwelling unit, which within a reasonable time (determined at the time the loan
is made) will be used as the principal residence of the Participant, the
repayment period may extend beyond five years from the date of the loan. The
period of repayment for any loan shall be arrived at by mutual agreement
between the Loan Administrator and the Participant and if the loan is for a
principal residence, shall not be made for a period longer than the repayment
period consistent with commercial practices.

 

47

 

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

 

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

 

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

 

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

 

In those cases
where repayment through payroll deduction is available, installments are so
payable, and a payroll deduction agreement shall be executed by the Participant
at the time the loan is made. Loan repayments that are accumulated through
payroll deduction shall be paid to the Trustee by the earlier of (i) the date
the loan repayments can reasonably be segregated from the Employer’s assets, or
(ii) the 15th business day of the month following the month in which such
amounts would otherwise have been paid in cash to the Participant.

 

Where payroll
deduction is not available, payments in cash are to be timely made. Any payment
that is not by payroll deduction shall be made payable to the Employer or the
Trustee, as specified in the promissory note, and delivered to the Loan
Administrator, including prepayments, service fees and penalties, if any, and
other amounts due under the note. The Loan Administrator shall deposit such
amounts into the Plan as soon as administratively practicable after they are
received, but in no event later than the 15th business day of the month after
they are received.

 

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

 

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

 

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

 

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

 

48

 

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

 

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

 

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

 

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

 

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

 

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

 

SECTION 5.07—DISTRIBUTIONS
UNDER QUALIFIED DOMESTIC RELATIONS ORDERS.

 

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

 

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

 

49

 

The benefit
payable to an Alternate Payee shall be subject to the provisions of the SMALL
AMOUNTS SECTION of Article X if the value of the benefit does not
exceed $5,000 ($3,500 for Plan Years beginning before August 6, 1997).

 

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

 

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

 

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

 

50

 

ARTICLE VI

 

DISTRIBUTION
OF BENEFITS

 

SECTION 6.01—AUTOMATIC FORMS OF DISTRIBUTION.

 

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

 

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

 

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

 

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

 

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

 

(1)                                  A
Qualified Preretirement Survivor Annuity for a Participant who has a spouse to
whom he has been continuously married throughout the one-year period ending on
the date of his death. The spouse may elect to start receiving the death
benefit on any first day of the month on or after the Participant dies and by
the date the Participant would have been age 701/2. If the spouse dies before
benefits start, the Participant’s Vested Account, determined as of the date of
the spouse’s death, shall be paid to the spouse’s Beneficiary.

 

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

 

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

 

SECTION 6.02—OPTIONAL FORMS OF DISTRIBUTION.

 

(a)                                  Retirement
Benefits. The optional forms of retirement benefit shall be the following: (i)
a straight life annuity; (ii) single life annuities with certain periods of 5,
10 or 15 years; (iii) a single life annuity with installment refund; (iv)
survivorship life annuities with installment refund and survivorship
percentages of 50%, 66 2/3% or 100%; (v) fixed period annuities for any period
of whole months which is not less than 60 and does not exceed the Life
Expectancy, as defined in Article VII, of the Participant where the Life
Expectancy is not recalculated; and (vi) a full flexibility option. A single
sum payment is also available.

 

The full flexibility option is an optional
form of benefit under which the Participant receives a distribution each
calendar year, beginning with the calendar year in which his Annuity Starting
Date occurs. The Participant may elect the amount to be distributed each year
(not less than

 

51

 

$1,000). The amount payable in his first
Distribution Calendar Year, as defined in Article VII, must satisfy the
minimum distribution requirements of Article VII for such year.
Distributions for later Distribution Calendar Years, as defined in Article VII,
must satisfy the minimum distribution requirements of Article VII for such
years. If the Participant’s Annuity Starting Date does not occur until his
second Distribution Calendar Year, as defined in Article VII, the amount
payable for such year must satisfy the minimum distribution requirements of Article VII
for both the first and second Distribution Calendar Years, as defined in Article VII.

 

If the Plan is amended to eliminate or
restrict an optional form of distribution and the Plan provides a single sum
distribution form that is otherwise identical to the optional form of
distribution eliminated or restricted, the amendment shall not apply to any
distribution with an Annuity Starting Date earlier than the first day of the
second Plan Year following the Plan Year in which the amendment is adopted.

 

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

 

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

 

(b)                                 Death
Benefits. The optional forms of death benefit are a single-sum payment and any
annuity that is an optional form of retirement benefit. However, the full
flexibility option shall not be available if the Beneficiary is not the spouse of
the deceased Participant.

 

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

 

SECTION 6.03—ELECTION
PROCEDURES.

 

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

 

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

 

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

 

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

 

52

 

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

 

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

 

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

 

(1)                                  Election
Period for Retirement Benefits. The election period as to retirement benefits
is the 90-day period ending on the Annuity Starting Date. An election to waive
the Qualified Joint and Survivor Annuity may not be made before the date the
Participant is provided with the notice of the ability to waive the Qualified
Joint and Survivor Annuity. If the Participant elects a full flexibility
option, he may revoke his election at any time before his first Distribution
Calendar Year, as defined in Article VII. When he elects to have benefits
begin again, he shall have a new Annuity Starting Date. His election period for
this election is the 90-day period ending on the Annuity Starting Date for the
optional form of retirement benefit elected.

 

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

 

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

 

(3)                                  Consent
to Election. If the Participant’s Vested Account exceeds $5,000 ($3,500 for
Plan Years beginning before August 6, 1997), any benefit which is (i)
immediately distributable or (ii) payable in a form other than a Qualified
Joint and Survivor Annuity or a Qualified Preretirement Survivor Annuity,
requires the consent of the Participant and the Participant’s spouse (or where
either the Participant or the spouse has died, the survivor). Such consent
shall also be required if the Participant’s Vested Account at the time of any
prior distribution exceeded $5,000 ($3,500 for Plan Years beginning before August 6,
1997). The rule in the preceding sentence shall not apply effective October 17,
2000. However, consent will still be required if the Participant had previously
had an Annuity Starting Date with respect to any portion of such Vested
Account.

 

53

 

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

 

The consent shall not be made more than 90
days before the Annuity Starting Date. Spousal consent is not required for a
benefit which is immediately distributable in a Qualified Joint and Survivor
Annuity. Furthermore, if spousal consent is not required because the
Participant is electing an optional form of retirement benefit that is not a
life annuity pursuant to (d) below, only the Participant need consent to the
distribution of a benefit payable in a form that is not a life annuity and
which is immediately distributable. Neither the consent of the Participant nor
the Participant’s spouse shall be required to the extent that a distribution is
required to satisfy Code Section 401 (a)(9) or Code Section 415.

 

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

 

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

 

If the Qualified Joint and Survivor Annuity
is waived, the spouse has the right to limit consent only to a specific
Beneficiary or a specific form of benefit. The spouse can relinquish one or
both such rights. Such consent shall be made in writing. The consent shall not
be made more than 90 days before the Annuity Starting Date. If the Qualified
Preretirement Survivor Annuity is waived, the spouse has the right to limit
consent only to a specific Beneficiary. Such consent shall be in writing. The
spouse’s consent shall be witnessed by a plan representative or notary public.
The spouse’s consent must acknowledge-the-effect of the election, including
that the spouse had the right to limit, consent only to a specific Beneficiary
or a specific form of benefit, if applicable, and that the relinquishment of
one or both such rights was voluntary. Unless the consent of the spouse
expressly permits designations by the Participant without a requirement of further
consent by the spouse, the spouse’s consent must be limited to the form of
benefit, if applicable, and the Beneficiary (including any Contingent
Annuitant), class of Beneficiaries, or contingent Beneficiary named in the
election.

 

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

 

54

 

Participant without further consent by the
spouse. A spouse’s consent may be revoked at any time within the Participant’s
election period.

 

(d)                                 Special Rule for Profit Sharing Plans. This
subparagraph (d) applies if the Plan is not a direct or indirect transferee
after December 31, 1984, of a defined benefit plan, money purchase plan,
target benefit plan, stock bonus plan, or profit sharing plan which is subject
to the survivor annuity requirements of Code Sections 401(a)(11) and 417. If
the above condition is met, spousal consent is not required for electing an
optional form of retirement benefit that is not a life annuity. If such
condition is not met, such consent requirements shall be operative.

 

SECTION 6.04—NOTICE
REQUIREMENTS.

 

(a)                                  Optional Forms of Retirement Benefit and Right
to Defer. The Plan Administrator shall furnish to the Participant and the
Participant’s spouse a written explanation of the optional forms of retirement
benefit in the OPTIONAL FORMS OF DISTRIBUTION SECTION of this article, including
the material features and relative values of these options, in a manner that
would satisfy the notice requirements of Code Section 417(a)(3) and the
right of the Participant and the Participant’s spouse to defer distribution
until the benefit is no longer immediately distributable.

 

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

 

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

 

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

 

The Plan Administrator shall furnish the written
explanation by a method reasonably calculated to reach the attention of the
Participant no less than 30 days, and no more than 90 days, before the Annuity
Starting Date.

 

The Participant (and spouse, if applicable) may waive
the 30-day election period if the distribution of the elected form of
retirement benefit begins more than 7 days after the Plan Administrator
provides the Participant (and spouse, if applicable) the written explanation
provided that:  the Participant has been
provided with information that clearly indicates that the Participant has at
least 30 days to consider whether to waive the Qualified Joint and Survivor
Annuity and elect

 

55

 

(with spousal consent, if applicable) a form
of distribution other than a Qualified Joint and Survivor Annuity, (ii) the
Participant is permitted to revoke any affirmative distribution election at
least until the Annuity Starting Date or, if later, at any time prior to the
expiration of the 7-day period that begins the day after the explanation of the
Qualified Joint and Survivor Annuity is provided to the Participant, and (iii)
the Annuity Starting Date is a date after the date that the written explanation
was provided to the Participant.

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

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

 

56

 

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

 

57

 

ARTICLE VII 

 

DISTRIBUTION
REQUIREMENTS

 

 SECTION 7.01—APPLICATION.

 

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

 

SECTION 7.02—DEFINITIONS.

 

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

 

Applicable Life Expectancy means Life
Expectancy (or Joint and Last Survivor Expectancy) calculated using the attained
age of the Participant for Designated Beneficiary) as of the Participant’s (or
Designated Beneficiary’s) birthday in the applicable calendar year reduced by
one for each calendar year which has elapsed since the date Life Expectancy was
first calculated. If Life Expectancy is being recalculated, the Applicable Life
Expectancy shall be the Life Expectancy so recalculated. The applicable
calendar year shall be the first Distribution Calendar Year, and if Life
Expectancy is being recalculated, such succeeding calendar year.

 

Designated Beneficiary means the individual
who is designated as the beneficiary under the Plan in accordance with Code Section 401(a)(9)
and the regulations thereunder.

 

Distribution Calendar Year means a calendar
year for which a minimum distribution is required. For distributions beginning
before the Participant’s death, the first Distribution Calendar Year is the
calendar year immediately preceding the calendar year which contains the
Participant’s Required Beginning Date. For distributions beginning after the
Participant’s death, the first Distribution Calendar Year is the calendar year
in which distributions are required to begin pursuant to (e) of the
DISTRIBUTION REQUIREMENTS SECTION of this article.

 

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

 

In addition, a Participant is treated as a
5-percent Owner for purposes of this article if such Participant becomes a
5-percent Owner in a later Plan Year. Such Participant’s Required Beginning
Date shall not be later than the April 1 of the calendar year following
the calendar year in which such later Plan Year ends.

 

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

 

Joint and Last Survivor Expectancy means
joint and last survivor expectancy computed using the expected return multiples
in Table VI of section 1.72-9 of the Income Tax Regulations.

 

58

 

Unless otherwise elected by the Participant
by the time distributions are required to begin, life expectancies shall be
recalculated annually. Such election shall be irrevocable as to the Participant
and shall apply to all subsequent years. The life expectancy of a nonspouse
Beneficiary may not be recalculated.

 

Life Expectancy means life expectancy
computed using the expected return multiples in Table V of section 1.72-9
of the Income Tax Regulations.

 

Unless otherwise elected by the Participant
(or spouse, in the case of distributions described in (e)(2)(ii) of the
DISTRIBUTION REQUIREMENTS SECTION of this article) by the time
distributions are required to begin, life expectancy shall be recalculated
annually. Such election shall be irrevocable as to the Participant (or spouse)
and shall apply to all subsequent years. The life expectancy of a nonspouse
Beneficiary may not be recalculated.

 

Participant’s Benefit means:

 

(a)                                  The
Account balance as of the last Valuation Date in the calendar year immediately
preceding the Distribution Calendar Year (valuation calendar year) increased by
the amount of any contributions or forfeitures allocated to the Account balance
as of the dates in the valuation calendar year after the Valuation Date and
decreased by distributions made in the valuation calendar year after the
Valuation Date.

 

(b)                                 Exception
for Second Distribution Calendar Year. For purposes of (a) above, if any
portion of the minimum distribution for the first Distribution Calendar Year is
made in the second Distribution Calendar Year on or before the Required
Beginning Date, the amount of the minimum distribution made in the second
Distribution Calendar Year shall be treated as if it had been made in the
immediately preceding Distribution Calendar Year.

 

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

 

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

 

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

 

The options available for Participants who
are not 5-percent Owners and attained age 70 1/2 in calendar years before the
calendar year that begins after the later of December 31, 1998, or the
adoption date of the amendment which eliminated the preretirement age 70 1/2
distribution shall be the following. Any such Participant attaining age 70 1/2
in years after 1995 may elect by April 1 of the calendar year following
the calendar year in which he attained age 70 1/2 (or by December 31,

 

59

 

1997 in the case of a Participant attaining
age 70 1/2 in 1996) to defer distributions until the calendar year following
the calendar year in which he retires. Any such Participant attaining age 70 1/2
in years prior to 1997 may elect to stop distributions which are not purchased
annuities and recommence by the April 1 of the calendar year following the
year in which he retires. There shall be a new Annuity Starting Date upon
recommencement.

 

SECTION 7.03—DISTRIBUTION REQUIREMENTS.

 

(a)                                  General
Rules.

 

(1)                                  Subject
to the AUTOMATIC FORMS OF DISTRIBUTION SECTION of Article VI, joint
and survivor annuity requirements, the requirements of this article shall
apply to any distribution of a Participant’s interest and shall take precedence
over any inconsistent provisions of this Plan. Unless otherwise specified, the
provisions of this article apply to calendar years beginning after December 31,
1984.

 

(2)                                  All
distributions required under this article shall be determined and made in
accordance with the proposed regulations under Code Section 401(a)(9),
including the minimum distribution incidental benefit requirement of section 1.401(a)(9)-2
of the proposed regulations.

 

(3)                                  With
respect to distributions under the Plan made on or after June 14, 2001,
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 Code Section 401(a)(9) that were proposed
on January 17, 2001 (the 2001 Proposed Regulations), 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 June 14, 2001, 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 June 14, 2001, 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. These provisions shall continue in effect until the last
calendar year beginning before the effective date of final regulations under
Code Section 401(a)(9) or such other date as may be published by the
Internal Revenue Service.

 

(b)                                 Required
Beginning Date. The entire interest of a Participant must be distributed or
begin to be distributed no later than the Participant’s Required Beginning
Date.

 

(c)                                  Limits
on Distribution Periods. As of the first Distribution Calendar Year,
distributions, if not made in a single sum, may only be made over one of the
following periods (or combination thereof):

 

(1)                                  the
life of the Participant,

 

(2)                                  the
life of the Participant and a Designated Beneficiary,

 

60

 

(3)                                  a
period certain not extending beyond the Life Expectancy of the Participant, or

 

(4)                                  a
period certain not extending beyond the Joint and Last Survivor Expectancy of
the Participant and a Designated Beneficiary.

 

(d)                                 Determination
of Amount to be Distributed Each Year. If the Participant’s interest is to be
distributed in other than a single sum, the following minimum distribution
rules shall apply on or after the Required Beginning Date:

 

(1)                                  Individual
Account.

 

(i)                                     If
a Participant’s Benefit is to be distributed over

 

A.                                   a
period not extending beyond the Life Expectancy of the Participant or the Joint
Life and Last Survivor Expectancy of the Participant and the Participant’s
Designated Beneficiary, or

 

B.                                     a
period not extending beyond the Life Expectancy of the Designated Beneficiary,

 

the amount required to be distributed for each
calendar year beginning with the distributions for the first Distribution
Calendar Year, must be at least equal to the quotient obtained by dividing the
Participant’s Benefit by the Applicable Life Expectancy.

 

(ii)           For
calendar years beginning before January 1, 1989, if the Participant’s
spouse is not the Designated Beneficiary, the method of distribution selected
must assure that at least 50 percent of the present value of the amount
available for distribution is paid within the Life Expectancy of the
Participant.

 

(iii)          For
calendar years beginning after December 31, 1988, the amount to be distributed
each year, beginning with distributions for the first Distribution Calendar
Year shall not be less than the quotient obtained by dividing the Participant’s
Benefit by the lesser of:

 

A.                                   the
Applicable Life Expectancy, or

 

B.                                     if
the Participant’s spouse is not the Designated Beneficiary, the applicable
divisor determined from the table set forth in Q&A-4 of section 1.401(a)(9)-2
of the proposed regulations.

 

Distributions after the death of the Participant
shall be distributed using the Applicable Life Expectancy in (1)(i) above as
the relevant divisor without regard to section 1.401(a)(9)-2 of the
proposed regulations.

 

(iv)          The minimum distribution required for the
Participant’s first Distribution Calendar Year must be made on or before the
Participant’s Required Beginning Date. The minimum distribution for other
calendar years, including the minimum distribution for

 

61

 

the Distribution Calendar Year in which the
Participant’s Required Beginning Date occurs, must be made on or before December 31
of that Distribution Calendar Year.

 

(2)                                  Other
Forms. If the Participant’s Benefit is distributed in the form of an annuity
purchased from an insurance company, distributions thereunder shall be made in
accordance with the requirements of Code Section 401(a)(9) and the
proposed regulations thereunder.

 

(e)                                  Death
Distribution Provisions.

 

(1)                                  Distribution
Beginning Before Death. If the Participant dies after distribution of his
interest has begun, the remaining portion of such interest will continue to be
distributed at least as rapidly as under the method of distribution being used
prior to the Participant’s death.

 

(2)                                  Distribution
Beginning After Death.

 

(i)                                     If
the Participant dies before distribution of his interest begins, distribution
of the Participant’s entire interest shall be completed by December 31 of
the calendar year containing the fifth anniversary of the Participant’s death
except to the extent that an election is made to receive distributions in accordance
with A or B below:

 

A.                                   if
any portion of the Participant’s interest is payable to a Designated
Beneficiary, distributions may be made over the life or over a period certain
not greater than the Life Expectancy of the Designated Beneficiary beginning on
or before December 31 of the calendar year immediately following the
calendar year in which the Participant died;

 

B.                                     if
the Designated Beneficiary is the Participant’s surviving spouse, the date
distributions are required to begin in accordance with A above shall not be
earlier than the later of:

 

1.                                       December 31
of the calendar year immediately following the calendar year in which the
Participant died, or

 

2.                                       December 31
of the calendar year in which the Participant would have attained age 70 1/2.

 

(ii)                                  If
the Participant has not made an election pursuant to this (e)(2) by the time of
his death, the Participant’s Designated Beneficiary must elect the method of
distribution no later than the earlier of:

 

A.                                   December 31
of the calendar year in which distributions would be required to begin under
this subparagraph, or

 

B.                                     December 31
of the calendar year which contains the fifth anniversary of the date of death
of the Participant.

 

(iii)                               If the Participant has no Designated
Beneficiary, or if the Designated Beneficiary does not elect a method of
distribution, distribution of the Participant’s entire interest

 

62

 

must be completed by December 31 of the
calendar year containing the fifth anniversary of the Participant’s death.

 

(3)                                  For
purposes of (e)(2) above, if the surviving spouse dies after the Participant,
but before payments to such spouse begin, the provisions of (e)(2) above, with
the exception of (e)(2)(i)(B) therein, shall be applied as if the surviving
spouse were the Participant.

 

(4)                                  For
purposes of this (e), distribution of a Participant’s interest is considered to
begin on the Participant’s Required Beginning Date (or if (e)(3) above is
applicable, the date distribution is required to begin to the surviving spouse
pursuant to (e)(2) above). If distribution in the form of an annuity
irrevocably begins to the Participant before the Required Beginning Date; the
date distribution is considered to begin is the date distribution actually
begins.

 

63

 

ARTICLE VIII

 

TERMINATION
OF THE PLAN

 

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

 

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

 

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

 

Elective
Deferral Contributions Qualified Nonelective Contributions

 

A Participant’s
Account resulting from such Contributions may be distributed upon complete
termination of the Plan, but only if neither the Employer nor any Controlled
Group member maintain or establish a successor defined contribution plan (other
than an employer stock ownership plan as defined in Code Section 4975(e)(7),
a simplified employee pension plan as defined in Code Section 408(k) or a
SIMPLE IRA plan as defined in Code Section 408(p)) and such distribution
is made in a lump sum. A distribution under this article shall be a
retirement benefit and shall be distributed to the Participant according to the
provisions of Article VI.

 

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

 

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

 

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

 

64

 

ARTICLE IX

 

ADMINISTRATION OF THE PLAN

 

SECTION 9.01—ADMINISTRATION.

 

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

 

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

 

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

 

SECTION 9.02—EXPENSES.

 

Expenses of the
Plan, to the extent that the Employer does not pay such expenses, may be paid
out of the assets of the Plan provided that such payment is consistent with
ERISA. Such expenses include, but are not limited to, expenses for bonding
required by ERISA; expenses for recordkeeping and other administrative services;
fees and expenses of the Trustee or Annuity Contract; expenses for investment
education service and direct costs that the Employer incurs with respect to the
Plan.

 

SECTION 9.03—RECORDS.

 

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

 

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

 

65

 

SECTION 9.04—INFORMATION
AVAILABLE.

 

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

 

SECTION 9.05—CLAIM
AND APPEAL PROCEDURES.

 

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

 

If a claim for
benefits under the Plan is denied, the Plan Administrator shall provide
adequate written notice to the Claimant whose claim for benefits under the Plan
has been denied. The notice must be furnished within 90 days of the date that
the claim is received by the Plan Administrator. The Claimant shall be notified
in writing within this initial 90-day period if special circumstances require
an extension of time needed to process the claim and the date by which the Plan
Administrator’s decision is expected to be rendered. The written notice shall
be furnished no later than 180 days after the date the claim was received by
the Plan Administrator.

 

The Plan
Administrator’s notice to the Claimant shall specify the reason for the denial;
specify references to pertinent Plan provisions on which denial is based;
describe any additional material and information needed for the Claimant to
perfect his claim for benefits; explain why the material and information is
needed; inform the Claimant that any appeal he wishes to make must be in
writing to the Plan Administrator within 60 days after receipt of the Plan
Administrator’s notice of denial of benefits and that failure to make the
written appeal within such 60-day period renders the Plan Administrator’s
determination of such denial final, binding and conclusive.

 

If the Claimant appeals to the Plan
Administrator, the Claimant (or his authorized representative) may submit in
writing whatever issues and comments the Claimant (or his authorized
representative) feels are pertinent. The Claimant (or his authorized
representative) may review pertinent Plan documents. The Plan Administrator
shall reexamine all facts related to the appeal and make a final determination
as to whether the denial of benefits is justified under the circumstances. The
Plan Administrator shall advise the Claimant of its decision within 60 days of
his written request for review, unless special circumstances (such as a
hearing) would make rendering a decision within the 60-day limit unfeasible.
The Claimant must be notified within the 60-day limit if an extension is
necessary. The Plan Administrator shall render a decision on a claim for
benefits no later than 120 days after the request for review is received.

 

SECTION 9.06—DELEGATION
OF AUTHORITY.

 

All or any part
of the administrative duties and responsibilities under this article may
be delegated by the Plan Administrator to a retirement committee. The duties
and responsibilities of the retirement committee shall be set out in a separate
written agreement.

 

66

 

SECTION 9.07—EXERCISE OF DISCRETIONARY AUTHORITY.

 

The Employer, Plan
Administrator, and any other person or entity who has authority with respect to
the management, administration, or investment of the Plan may exercise that
authority in its/his full discretion, subject only to the duties imposed under
ERISA. This discretionary authority includes, but is not limited to, the
authority to make any and all factual determinations and interpret all terms
and provisions of the Plan documents relevant to the issue under consideration.
The exercise of authority will be binding upon all persons; will be given
deference in all courts of law; and will not be overturned or set aside by any
court of law unless found to be arbitrary and capricious or made in bad faith.

 

67

 

ARTICLE X 

 

GENERAL
PROVISIONS

 

SECTION 10.01—AMENDMENTS.

 

The Employer
may amend this Plan at any time, including any remedial retroactive changes
(within the time specified by Internal Revenue Service regulations), to comply
with any law or regulation issued by any governmental agency to which the Plan
is subject.

 

An amendment
may not diminish or adversely affect any accrued interest or benefit of
Participants or their Beneficiaries nor allow reversion or diversion of Plan
assets to the Employer at any time, except as may be required to comply with
any law or regulation issued by any governmental agency to which the Plan is
subject.

 

No amendment to
this Plan shall be effective to the extent that it has the effect of decreasing
a Participant’s accrued benefit. However, a Participant’s Account may be
reduced to the extent permitted under Code Section 41 2(c)(8). For
purposes of this paragraph, a Plan amendment which has the effect of decreasing
a Participant’s Account with respect to benefits attributable to service before
the amendment shall be treated as reducing an accrued benefit. Furthermore, if
the vesting schedule of the Plan is amended, in the case of an Employee
who is a Participant as of the later of the date such amendment is adopted or
the date it becomes effective, the nonforfeitable percentage (determined as of
such date) of such Employee’s right to his employer-derived accrued benefit
shall not be less than his percentage computed under the Plan without regard to
such amendment.

 

No amendment to
the Plan shall be effective to eliminate or restrict an optional form of
benefit with respect to benefits attributable to service before the amendment
except as provided in the MERGERS AND DIRECT TRANSFERS SECTION of this article and
below:

 

(a)                                  The
Plan is amended to eliminate or restrict the ability of a Participant to
receive payment of his Account balance under a particular optional form of
benefit and the amendment satisfies the condition in (1) and the Plan satisfies
the condition in (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 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
Plan provides that 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 ERISA
requirements at 29 CFR 2520.104b-3 relating to a summary of material
modifications, or

 

68

 

(ii)                                  the
first day of the second Plan Year following the Plan Year in which the
amendment is adopted.

 

(b)                                 The
Plan is amended to eliminate or restrict in-kind distributions and the
conditions in Q&A 2(b)(2)(iii) in section 1.411 (d)-4 of the
regulations are met.

 

If, as a result
of an amendment, an Employer Contribution is removed that is not 100%
immediately vested when made, the applicable vesting schedule shall remain
in effect after the date of such amendment. The Participant shall not become
immediately 100% vested in such Contributions as a result of the elimination of
such Contribution except as otherwise specifically provided in the Plan.

 

An amendment
shall not decrease a Participant’s vested interest in the Plan. If an amendment
to the Plan, or a deemed amendment in the case of a change in top-heavy status
of the Plan as provided in the MODIFICATION OF VESTING REQUIREMENTS SECTION of
Article XI, changes the computation of the percentage used to determine
that portion of a Participant’s Account attributable to Employer Contributions
which is nonforfeitable (whether directly or indirectly), each Participant or
former Participant

 

(c)                                  who
has completed at least three Years of Service on the date the election period
described below ends (five Years of Service if the Participant does not have at
least one Hour-of-Service in a Plan Year beginning after December 31,
1988) and

 

(d)                                 whose
nonforfeitable percentage will be determined on any date after the date of the
change

 

may elect, during the
election period, to have the nonforfeitable percentage of his Account that
results from Employer Contributions determined without regard to the amendment.
This election may not be revoked. If after the Plan is changed, the Participant’s
nonforfeitable percentage will at all times be as great as it would have been
if the change had not been made, no election needs to be provided. The election
period shall begin no later than the date the Plan amendment is adopted, or
deemed adopted in the case of a change in the top-heavy status of the Plan, and
end no earlier than the 60th day after the latest of the date the amendment is
adopted (deemed adopted) or becomes effective, or the date the Participant is
issued written notice of the amendment (deemed amendment) by the Employer or
the Plan Administrator.

 

SECTION 10.02—DIRECT ROLLOVERS.

 

Notwithstanding
any provision of the Plan to the contrary that would otherwise limit a
Distributee’s election under this section, a Distributee may elect, at the time
and in the manner prescribed by the Plan Administrator, to have any portion of
an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan
specified by the Distributee in a Direct Rollover.

 

Any
distributions made under the SMALL AMOUNTS SECTION of this article (or
which are small amounts payments made under Article VIII at complete
termination of the Plan) which are Eligible Rollover Distributions and for
which the Distributee has not elected to either have such distribution paid to
him or to an Eligible Retirement Plan shall be paid to the Distributee.

 

SECTION 10.03—MERGERS AND DIRECT TRANSFERS.

 

The Plan may not be merged or consolidated
with, nor have its assets or liabilities transferred to, any other retirement
plan, unless each Participant in the plan would (if the plan then terminated)
receive a benefit

 

69

 

immediately after the merger, consolidation, or transfer which is equal
to or greater than the benefit the Participant would have been entitled to
receive immediately before the merger, consolidation, or transfer (if this Plan
had then terminated). The Employer may enter into merger agreements or direct
transfer of assets agreements with the employers under other retirement plans
which are qualifiable under Code Section 401(a), including an elective
transfer, and may accept the direct transfer of plan assets, or may transfer plan
assets, as a party to any such agreement. The Employer shall not consent to, or
be a party to a merger, consolidation, or transfer of assets with a defined
benefit plan if such action would result in a defined benefit feature being
maintained under this Plan.

 

Notwithstanding
any provision of the Plan to the contrary, to the extent any optional form of
benefit under the Plan permits a distribution prior to the Employee’s
retirement, death, disability, or severance from employment, and prior to plan
termination, the optional form of benefit is not available with respect to
benefits attributable to assets (including the post-transfer earnings thereon)
and liabilities that are transferred, within the meaning of Code Section 414(l),
to this Plan from a money purchase pension plan qualified under Code Section 401(a)
(other than any portion of those assets and liabilities attributable to
voluntary employee contributions).

 

The Plan may
accept a direct transfer of plan assets on behalf of an Eligible Employee. If
the Eligible Employee is not an Active Participant when the transfer is made,
the Eligible Employee shall be deemed to be an Active Participant only for the
purpose of investment and distribution of the transferred assets. Employer
Contributions shall not be made for or allocated to the Eligible Employee,
until the time he meets all of the requirements to become an Active
Participant.

 

The Plan shall
hold, administer, and distribute the transferred assets as a part of the Plan.
The Plan shall maintain a separate account for the benefit of the Employee on
whose behalf the Plan accepted the transfer in order to reflect the value of
the transferred assets.

 

Unless a
transfer of assets to the Plan is an elective transfer as described below, the
Plan shall apply the optional forms of benefit protections described in the
AMENDMENTS SECTION of this article to all transferred assets.

 

A Participant’s
protected benefits may be eliminated upon transfer between qualified defined
contribution plans if the conditions in Q&A 3(b)(1) in section 1.411(d)-4
of the regulations are met. The transfer must meet all of the other applicable
qualification requirements.

 

A Participant’s
protected benefits may be eliminated upon transfer between qualified plans
(both defined benefit and defined contribution) if the conditions in Q&A
3(c)(1) in section 1.411 (d)-4 of the regulations are met. Beginning January 1,
2002, if the Participant is eligible to receive an immediate distribution of
his entire nonforfeitable accrued benefit in a single sum distribution that
would consist entirely of an eligible rollover distribution under Code Section 401(a)(31),
such transfer will be accomplished as a direct rollover under Code Section 401(a)(31).
The rules applicable to distributions under the plan would apply to the
transfer, but the transfer would not be treated as a distribution for purposes
of the minimum distribution requirements of Code Section 401 (a)(9).

 

SECTION 10.04—PROVISIONS RELATING TO THE INSURER AND
OTHER PARTIES.

 

The obligations
of an Insurer shall be governed solely by the provisions of the Annuity
Contract. The Insurer shall not be required to perform any act not provided in
or contrary to the provisions of the Annuity

 

70

 

Contract. Each Annuity Contract when purchased shall comply with the
Plan. See the CONSTRUCTION SECTION of this article.

 

Any issuer or
distributor of investment contracts or securities is governed solely by the
terms of its policies, written investment contract, prospectuses, security
instruments, and any other written agreements entered into with the Trustee
with regard to such investment contracts or securities.

 

Such Insurer,
issuer or distributor is not a party to the Plan, nor bound in any way by the
Plan provisions. Such parties shall not be required to look to the terms of
this Plan, nor to determine whether the Employer, the Plan Administrator, the
Trustee, or the Named Fiduciary have the authority to act in any particular
manner or to make any contract or agreement.

 

Until notice of
any amendment or termination of this Plan or a change in Trustee has been
received by the Insurer at its home office or an issuer or distributor at their
principal address, they are and shall be fully protected in assuming that the
Plan has not been amended or terminated and in dealing with any party acting as
Trustee according to the latest information which they have received at their
home office or principal address.

 

SECTION 10.05—EMPLOYMENT STATUS.

 

Nothing
contained in this Plan gives an Employee the right to be retained in the
Employer’s employ or to interfere with the Employer’s right to discharge any
Employee.

 

SECTION 10.06—RIGHTS TO PLAN ASSETS.

 

An Employee
shall not have any right to or interest in any assets of the Plan upon
termination of employment or otherwise except as specifically provided under
this Plan, and then only to the extent of the benefits payable to such Employee
according to the Plan provisions.

 

Any final
payment or distribution to a Participant or his legal representative or to any
Beneficiaries, spouse or Contingent Annuitant of such Participant under the
Plan provisions shall be in full satisfaction of all claims against the Plan,
the Named Fiduciary, the Plan Administrator, the Insurer, the Trustee, and the
Employer arising under or by virtue of the Plan.

 

SECTION 10.07—BENEFICIARY.

 

Each
Participant may name a Beneficiary to receive any death benefit (other than any
income payable to a Contingent Annuitant) that may arise out of his
participation in the Plan. The Participant may change his Beneficiary from time
to time. Unless a qualified election has been made, for purposes of
distributing any death benefits before the Participant’s Retirement Date, the
Beneficiary of a Participant who has a spouse who is entitled to a Qualified
Preretirement Survivor Annuity shall be the Participant’s spouse. The
Participant’s Beneficiary designation and any change of Beneficiary shall be
subject to the provisions of the ELECTION PROCEDURES SECTION of Article VI.
It is the responsibility of the Participant to give written notice to the
Insurer of the name of the Beneficiary on a form furnished for that purpose.

 

With the
Employer’s consent, the Plan Administrator may maintain records of Beneficiary
designations for Participants before their Retirement Dates. In that event, the
written designations made by Participants

 

71

 

shall be filed with the Plan Administrator. If a Participant dies
before his Retirement Date, the Plan Administrator shall certify to the Insurer
the Beneficiary designation on its records for the Participant.

 

If there is no
Beneficiary named or surviving when a Participant dies, the Participant’s
Beneficiary shall be the Participant’s surviving spouse, or where there is no
surviving spouse, the executor or administrator of the Participant’s estate.

 

SECTION 10.08—NONALIENATION OF BENEFITS.

 

Benefits
payable under the Plan are not subject to the claims of any creditor of any
Participant, Beneficiary, spouse or Contingent Annuitant. A Participant,
Beneficiary, spouse or Contingent Annuitant does not have any rights to
alienate, anticipate, commute, pledge, encumber, or assign any of such
benefits, except in the case of a loan as provided in the LOANS TO PARTICIPANTS
SECTION of Article V. The preceding sentences shall also apply to the
creation, assignment, or recognition of a right to any benefit payable with
respect to a Participant according to a domestic relations order, unless such
order is determined by the Plan Administrator to be a qualified domestic
relations order, as defined in Code Section 414(p), or any domestic
relations order entered before January 1, 1985. The preceding sentences
shall not apply to any offset of a Participant’s benefits provided under the
Plan against an amount the Participant is required to pay the Plan with respect
to a judgement, order, or decree issued, or a settlement entered into, on or
after August 5, 1997, which meets the requirements of Code Sections
401(a)(13)(C) or (D).

 

SECTION 10.09—CONSTRUCTION.

 

The validity of
the Plan or any of its provisions is determined under and construed according
to Federal law and, to the extent permissible, according to the laws of the
state in which the Employer has its principal office. In case any provision of
this Plan is held illegal or invalid for any reason, such determination shall
not affect the remaining provisions of this Plan, and the Plan shall be
construed and enforced as if the illegal or invalid provision had never been
included.

 

In the event of
any conflict between the provisions of the Plan and the terms of any Annuity
Contract issued hereunder, the provisions of the Plan control.

 

SECTION 10.10—LEGAL ACTIONS.

 

No person
employed by the Employer; no Participant, former Participant, or their
Beneficiaries; nor any other person having or claiming to have an interest in
the Plan is entitled to any notice of process. A final judgment entered in any
such action or proceeding shall be binding and conclusive on all persons having
or claiming to have an interest in the Plan.

 

SECTION 10.11—SMALL AMOUNTS.

 

If consent of
the Participant is not required for a benefit which is immediately
distributable in the ELECTION PROCEDURES SECTION of Article VI, a
Participant’s entire Vested Account shall be paid in a single sum as of the
earliest of his Retirement Date, the date he dies, or the date he ceases to be
an Employee for any other reason (the date the Employer provides notice to the
record keeper of the Plan of such event, if later). For purposes of this
section, if the Participant’s Vested Account is zero, the Participant shall be
deemed to have received a distribution of such Vested Account. If a Participant
would have received a

 

72

 

distribution under the first sentence of this paragraph but for the
fact that the Participant’s consent was needed to distribute a benefit which is
immediately distributable, and if at a later time consent would not be needed
to distribute a benefit which is immediately distributable and such Participant
has not again become an Employee, such Vested Account shall be paid in a single
sum. This is a small amounts payment.

 

If a small
amounts payment is made as of the date the Participant dies, the small amounts
payment shall be made to the Participant’s Beneficiary (spouse if the death
benefit is payable to the spouse). If a small amounts payment is made while the
Participant is living, the small amounts payment shall be made to the
Participant. The small amounts payment is in full settlement of benefits
otherwise payable.

 

No other small
amounts payments shall be made.

 

SECTION 10.12—WORD USAGE.

 

The masculine
gender, where used in this Plan, shall include the feminine gender and the
singular words, as used in this Plan, may include the plural, unless the
context indicates otherwise.

 

The words “in
writing” and “written,” where used in this Plan, shall include any other forms,
such as voice response or other electronic system, as permitted by any
governmental agency to which the Plan is subject.

 

SECTION 10.13—CHANGE IN SERVICE METHOD.

 

(a)                                  Change
of Service Method Under This Plan. If this Plan is amended to change the method
of crediting service from the elapsed time method to the hours method for any
purpose under this Plan, the Employee’s service shall be equal to the sum of
(1), (2), and (3) below:

 

(1)                                  The
number of whole years of service credited to the Employee under the Plan as of
the date the change is effective.

 

(2)                                  One
year of service for the applicable computation period in which the change is
effective if he is credited with the required number of Hours-of-Service. If
the Employer does not have sufficient records to determine the Employee’s
actual Hours-of-Service in that part of the service period before the effective
date of the change, the Hours-of-Service shall be determined using an
equivalency. For any month in which he would be required to be credited with
one Hour-of-Service, the Employee shall be deemed for purposes of this section to
be credited with 190 Hours-of-Service.

 

(3)                                  The
Employee’s service determined under this Plan using the hours method after the
end of the computation period in which the change in service method was
effective.

 

If this Plan is amended to change the method
of crediting service from the hours method to the elapsed time method for any
purpose under this Plan, the Employee’s service shall be equal to the sum of
(4), (5), and (6) below:

 

(4)                                  The
number of whole years of service credited to the Employee under the Plan as of
the beginning of the computation period in which the change in service method
is effective.

 

73

 

(5)                                  the
greater of (i) the service that would be credited to the Employee for that
entire computation period using the elapsed time method or (ii) the service
credited to him under the Plan as of the date the change is effective.

 

(6)                                  The
Employee’s service determined under this Plan using the elapsed time method
after the end of the applicable computation period in which the change in
service method was effective.

 

(b)                                 Transfers
Between Plans with Different Service Methods. If an Employee has been a
participant in another plan of the Employer which credited service under the
elapsed time method for any purpose which under this Plan is determined using
the hours method, then the Employee’s service shall be equal to the sum of (1),
(2), and (3) below:

 

(1)                                  The
number of whole years of service credited to the Employee under the plan as of
the date he became an Eligible Employee under this Plan.

 

(2)                                  One
year of service for the applicable computation period in which he became an
Eligible Employee if he is credited with the required number of
Hours-of-Service. If the Employer does not have sufficient records to determine
the Employee’s actual Hours-of-Service in that part of the service period
before the date he became an Eligible Employee, the Hours-of-Service shall be
determined using an equivalency. For any month in which he would be required to
be credited with one Hour-of-Service, the Employee shall be deemed for purposes
of this section to be credited with 190 Hours-of-Service.

 

(3)                                  The
Employee’s service determined under this Plan using the hours method after the
end of the computation period in which he became an Eligible Employee.

 

If an Employee has been a participant in another
plan of the Employer which credited service under the hours method for any
purpose which under this Plan is determined using the elapsed time method, then
the Employee’s service shall be equal to the sum of (4), (5), and (6) below:

 

(4)                                  The
number of whole years of service credited to the Employee under the other plan
as of the beginning of the computation period under that plan in which he
became an Eligible Employee under this Plan.

 

(5)                                  The
greater of (i) the service that would be credited to the Employee for that
entire computation period using the elapsed time method or (ii) the service
credited to him under the other plan as of the date he became an Eligible
Employee under this Plan.

 

(6)                                  The
Employee’s service determined under this Plan using the elapsed time method
after the end of the applicable computation period under the other plan in
which he became an Eligible Employee.

 

If an Employee has been a participant in a
Controlled Group member’s plan which credited service under a different method
than is used in this Plan, in order to determine entry and vesting, the
provisions in (b) above shall apply as though the Controlled Group member’s
plan were a plan of the Employer.

 

74

 

Any modification of service contained in this
Plan shall be applicable to the service determined pursuant to this section.

 

SECTION 10.14—MILITARY
SERVICE.

 

Notwithstanding any provision of this Plan to
the contrary, the Plan shall provide contributions, benefits, and service
credit with respect to qualified military service in accordance with Code Section 414(u).
Loan repayments shall be suspended under this Plan as permitted under Code Section 414(u).

 

75

 

ARTICLE XI

 

TOP-HEAVY
PLAN REQUIREMENTS

 

SECTION 11.01—APPLICATION.

 

The provisions of this article shall
supersede all other provisions in the Plan to the contrary.

 

For the purpose
of applying the Top-heavy Plan requirements of this article, all members of the
Controlled Group shall be treated as one Employer. The term Employer, as used
in this article, shall be deemed to include all members of the Controlled
Group, unless the term as used clearly indicates only the Employer is meant.

 

The accrued
benefit or account of a participant which results from deductible employee
contributions shall not be included for any purpose under this article.

 

The minimum
vesting and contribution provisions of the MODIFICATION OF VESTING REQUIREMENTS
and MODIFICATION OF CONTRIBUTIONS SECTIONS of this article shall not apply
to any Employee who is included in a group of Employees covered by a collective
bargaining agreement which the Secretary of Labor finds to be a collective bargaining
agreement between employee representatives and one or more employers, including
the Employer, if there is evidence that retirement benefits were the subject of
good faith bargaining between such representatives. For this purpose, the term “employee
representatives” does not include any organization more than half of whose
members are employees who are owners, officers, or executives.

 

SECTION 11.02—DEFINITIONS.

 

For purposes of
this article the following terms are defined: Aggregation Group means:

 

(a)                                  each
of the Employer’s qualified plans in which a Key Employee is a participant
during the Plan Year containing the Determination Date (regardless of whether
the plan was terminated) or one of the four preceding Plan Years,

 

(b)                                 each
of the Employer’s other qualified plans which allows the plan(s) described in
(a) above to meet the nondiscrimination requirement of Code Section 401(a)(4)
or the minimum coverage requirement of Code Section 410, and

 

(c)                                  any
of the Employer’s other qualified plans not included in (a) or (b) above which
the Employer desires to include as part of the Aggregation Group. Such a
qualified plan shall be included only if the Aggregation Group would continue
to satisfy the requirements of Code Section 401(a)(4) and Code Section 410.

 

The plans in (a) and (b) above constitute the “required”
Aggregation Group. The plans in (a), (b), and (c) above constitute the “permissive”
Aggregation Group.

 

76

 

Compensation means compensation as defined in
the CONTRIBUTION LIMITATION SECTION of Article III. For purposes of
determining who is a Key Employee in years beginning before January 1,
1998, Compensation shall include, in addition to compensation as defined in the
CONTRIBUTION LIMITATION SECTION of Article Ill, elective
contributions. Elective contributions are amounts excludible from the gross
income of the Employee under Code Sections 125, 402(e)(3), 402(h)(1)(B), or
403(b), and contributed by the Employer, at the Employee’s election, to a Code Section 401(k)
arrangement, a simplified employee pension, cafeteria plan, or tax-sheltered
annuity. Elective contributions also include amounts deferred under a Code Section 457
plan maintained by the Employer.

 

Determination Date means as to any plan, for any
plan year subsequent to the first plan year, the last day of the preceding plan
year. For the first plan year of the plan, the last day of that year.

 

Key Employee means any Employee or former
Employee (and the Beneficiaries of such Employee) who at any time during the
determination period was:

 

(a)                                  an
officer of the Employer if such individual’s annual Compensation exceeds 50
percent of the dollar limitation under Code Section 415(b)(1)(A).

 

(b)                                 an
owner (or considered an owner under Code Section 318) of one of the ten
largest interests in the Employer if such individual’s annual Compensation
exceeds 100 percent of the dollar limitation under Code Section 41
5(c)(1)(A).

 

(c)                                  a
5-percent owner of the Employer, or

 

(d)                                 a
1-percent owner of the Employer who has annual Compensation of more than
$150,000.

 

The determination period is the Plan Year
containing the Determination Date and the four preceding Plan Years.

 

The determination of who is a Key Employee
shall be made according to Code Section 416(i)(1) and the regulations
thereunder.

 

Non-key Employee means any Employee who is
not a Key Employee.

 

Present Value means the present value of a
participant’s accrued benefit under a defined benefit plan or purposes of
establishing Present Value to compute the Top-heavy Ratio, any benefit shall be
discounted only for 7.5% interest and mortality according to the 1971 Group
Annuity Table (Male) without the 7% margin but with projection by Scale E from
1971 to the later of (a) 1974, or (b) the year determined by adding the age to
1920, and wherein for females the male age six years younger is used.

 

Top-heavy Plan means a plan which is
top-heavy for any plan year beginning after December 31, 1983. This Plan
shall be top-heavy if any of the following conditions exist:

 

(a)                                  The
Top-heavy Ratio for this Plan exceeds 60 percent and this Plan is not part of
any required Aggregation Group or permissive Aggregation Group.

 

(b)                                 This
Plan is a part of a required Aggregation Group, but not part of a permissive
Aggregation Group, and the Top-heavy Ratio for the required Aggregation Group
exceeds 60 percent.

 

77

 

(c)                                  This
Plan is a part of a required Aggregation Group and part of a permissive
Aggregation Group and the Top-heavy Ratio for the permissive Aggregation Group
exceeds 60 percent.

 

Top-heavy Ratio means:

 

(a)                                  If
the Employer maintains one or more defined contribution plans (including any
simplified employee pension plan) and the Employer has not maintained any
defined benefit plan which during the five-year period ending on the
Determination Date(s) has or has had accrued benefits, the Top-heavy Ratio for
this Plan alone or for the required or permissive Aggregation Group, as
appropriate, is a fraction, the numerator of which is the sum of the account
balances of all Key Employees as of the Determination Date(s) (including any
part of any account balance distributed in the five-year period ending on the
Determination Date(s)), and the denominator of which is the sum of all account
balances (including any part of any account balance distributed in the
five-year period ending on the Distribution Date(s)), 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.

 

(b)                                 If
the Employer maintains one or more defined contribution plans (including any
simplified employee pension plan) and the Employer maintains or has maintained
one or more defined benefit plans which during the five-year period ending on
the Determination Date(s) has or has had accrued benefits, the Top-heavy Ratio
for any required or permissive Aggregation Group, as appropriate, is a
fraction, the numerator of which is the sum of the account balances under the
aggregated defined contribution plan or plans of all Key Employees determined
in accordance with (a) above, and the Present Value of accrued benefits under
the aggregated defined benefit plan or plans for all Key Employees as of the
Determination Date(s), and the denominator of which is the sum of the account
balances under the aggregated defined contribution plan or plans for all
participants, determined in accordance with (a) above, and the Present Value of
accrued benefits under the defined benefit plan or plans for all participants
as of the Determination Date(s), all determined in accordance with Code Section 416
and the regulations thereunder. The accrued benefits under a defined benefit
plan in both the numerator and denominator of the Top-heavy Ratio are increased
for any distribution of an accrued benefit made in the five-year period ending
on the Determination Date.

 

(c)                                  For
purposes of (a) and (b) above, the value of account balances and the Present
Value of accrued benefits will be determined as of the most recent Valuation
Date that falls within or ends with the 12-month period ending on the
Determination Date, except as provided in Code Section 416 and the
regulations thereunder for the first and second plan years of a defined benefit
plan. The account balances and accrued benefits of a participant (i) who is not
a Key Employee but who was a Key Employee in a prior year or (ii) who has not
been credited with at least an hour of service with any employer maintaining
the plan at any time during the five-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.

 

78

 

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).

 

SECTION 11.03—MODIFICATION OF VESTING REQUIREMENTS.

 

If a
Participant’s Vesting Percentage determined under Article I is not at
least as great as his Vesting Percentage would be if it were determined under a
schedule permitted in Code Section 416, the following shall apply.
During any Plan Year in which the Plan is a Top-heavy Plan, the Participant’s
Vesting Percentage shall be the greater of the Vesting Percentage determined
under Article I or the schedule below.

 

	
  VESTING SERVICE

  	
   

  	
  NONFORFEITABLE

  PERCENTAGE

  	
   

  
	
  (whole years)

  	
   

  	
   

  	
   

  
	
  Less than 2

  	
   

  	
  0

  	
   

  
	
  2

  	
   

  	
  20

  	
   

  
	
  3

  	
   

  	
  40

  	
   

  
	
  4

  	
   

  	
  60

  	
   

  
	
  5

  	
   

  	
  80

  	
   

  
	
  6 or more

  	
   

  	
  100

  	
   

  

 

The schedule above
shall not apply to Participants who are not credited with an Hour-of-Service
after the Plan first becomes a Top-heavy Plan. The Vesting Percentage
determined above applies to the portion of the Participant’s Account which is
multiplied by a Vesting Percentage to determine his Vested Account, including
benefits accrued before the effective date of Code Section 416 and
benefits accrued before this Plan became a Top-heavy Plan.

 

If, in a later
Plan Year, this Plan is not a Top-heavy Plan, a Participant’s Vesting
Percentage shall be determined under Article I. A Participant’s Vesting
Percentage determined under either Article I or the schedule above
shall never be reduced and the election procedures of the AMENDMENTS SECTION of
Article X shall apply when changing to or from the schedule as though
the automatic change were the result of an amendment.

 

The part of the
Participant’s Vested Account resulting from the minimum contributions required
pursuant to the MODIFICATION OF CONTRIBUTIONS SECTION of this article (to
the extent required to be nonforfeitable under Code Section 416(b)) may
not be forfeited under Code Section 411(a)(3)(B) or (D).

 

SECTION 11.04—MODIFICATION
OF CONTRIBUTIONS.

 

During any Plan
Year in which this Plan is a Top-heavy Plan, the Employer shall make a minimum
contribution as of the last day of the Plan Year for each Non-key Employee who
is an Employee on the last day of the Plan Year and who was an Active
Participant at any time during the Plan Year. A Non-key Employee is not
required to have a minimum number of Hours-of-Service or minimum amount of
Compensation in order to be entitled to this minimum. A Non-key Employee who
fails to be an Active Participant merely because his Compensation is less than
a stated amount or merely because of a failure to make mandatory participant

 

79

 

contributions or, in the case of a cash or deferred arrangement,
elective contributions shall be treated as if he were an Active Participant.
The minimum is the lesser of (a) or (b) below:

 

(a)                                  3
percent of such person’s Compensation for such Plan Year.

 

(b)                                 The
“highest percentage” of Compensation for such Plan Year at which the Employer’s
contributions are made for or allocated to any Key Employee. The highest
percentage shall be determined by dividing the Employer Contributions made for
or allocated to each Key Employee during the Plan Year by the amount of his
Compensation for such Plan Year, and selecting the greatest quotient (expressed
as a percentage). To determine the highest percentage, all of the Employer’s
defined contribution plans within the Aggregation Group shall be treated as one
plan. The minimum shall be the amount in (a) above if this Plan and a defined
benefit plan of the Employer are required to be included in the Aggregation
Group and this Plan enables the defined benefit plan to meet the requirements
of Code Section 401(a)(4) or 410.

 

For purposes of
(a) and (b) above, Compensation shall be limited by Code Section 401 (a)(17).

 

If the Employer’s
contributions and allocations otherwise required under the defined contribution
plan(s) are at least equal to the minimum above, no additional contribution
shall be required. If the Employer’s total contributions and allocations are
less than the minimum above, the Employer shall contribute the difference for
the Plan Year.

 

The minimum
contribution applies to all of the Employer’s defined contribution plans in the
aggregate which are Top-heavy Plans. A minimum contribution under a profit
sharing plan shall be made without regard to whether or not the Employer has
profits.

 

If a person who
is otherwise entitled to a minimum contribution above is also covered under
another defined contribution plan of the Employer’s which is a Top-heavy Plan
during that same Plan Year, any additional contribution required to meet the
minimum above shall be provided in this Plan.

 

If a person who
is otherwise entitled to a minimum contribution above is also covered under a
defined benefit plan of the Employer’s which is a Top-heavy Plan during that
same Plan Year, the minimum benefits for him shall not be duplicated. The
defined benefit plan shall provide an annual benefit for him on, or adjusted
to, a straight life basis equal to the lesser of:

 

(c)                                  2
percent of his average compensation multiplied by his years of service, or

 

(d)                                 20
percent of his average compensation.

 

Average compensation
and years of service shall have the meaning set forth in such defined benefit
plan for this purpose.

 

For purposes of
this section, any employer contribution made according to a salary reduction or
similar arrangement and employer contributions which are matching
contributions, as defined in Code Section 401(m), shall not apply in
determining if the minimum contribution requirement has been met, but shall
apply in determining the minimum contribution required.

 

The requirements of this section shall
be met without regard to any Social Security contribution.

 

 

80

 

SECTION 11.05—MODIFICATION
OF CONTRIBUTION LIMITATION.

 

If the
provisions of subparagraph (g) of the CONTRIBUTION LIMITATION SECTION of Article III
are applicable for any Limitation Year during which this Plan is a Top-heavy
Plan, the contribution limitations shall be modified. The definitions of
Defined Benefit Plan Fraction and Defined Contribution Plan Fraction in the
CONTRIBUTION LIMITATION SECTION of Article III shall be modified by
substituting “100 percent” in lieu of “125 percent.” In addition, an adjustment
shall be made to the numerator of the Defined Contribution Plan Fraction. The
adjustment is a reduction of that numerator similar to the modification of the
Defined Contribution Plan Fraction described in the CONTRIBUTION LIMITATION SECTION of
Article III, and shall be made with respect to the last Plan Year
beginning before January 1, 1984.

 

The
modifications in the paragraph above shall not apply with respect to a
Participant so long as employer contributions, forfeitures, or nondeductible
employee contributions are not credited to his account under this or any of the
Employer’s other defined contribution plans and benefits do not accrue for such
Participant under the Employer’s defined benefit plan(s), until the sum of his
Defined Contribution and Defined Benefit Plan Fractions is less than 1.0.

 

This section shall cease to apply
effective as of the first Limitation Year beginning on or after January 1,
2000.

 

81

 

By executing
this Plan, the Primary Employer acknowledges having counseled to the extent
necessary with selected legal and tax advisors regarding the Plan’s legal and
tax implications.

 

Executed this
                                          
day of                                                                                            ,                        

 

 

	
   

  	
  GOVERNMENT TECHNOLOGY
  SERVICES, INC. By:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Title

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Defined
  Contribution Plan 8.0

  	
   

  

 

82

 

OPERATIONAL HISTORY ADDENDUM TO

PRINCIPAL FINANCIAL GROUP
DEFINED CONTRIBUTION PLAN DOCUMENTS

 

The following provisions apply for Plan Years during the transition
period between the earliest effective date under the law changes, collectively
referred to as GUST, and the date the Employer adopts the GUST restated plan.

 

Definition of Highly Compensated. Employee

 

a)                                      For
the Plan Years marked, the Employer made the top-paid group election.

 

•                                          o
1997 o 1998 o
1999 o 2000 o
2001

 

b)                                     For the Plan Years
marked, the Employer made the calendar year data election.

 

•                                          o
1997 o 1998 o
1999 o 2000 o
2001

 

c)                                      For
the Plan Year marked, the Employer made the calendar year election.

 

•                                          o 1997

 

ADP/ACP Testing

 

a)                                      For
the Plan Years marked, the Employer used the prior year testing method for the
ADP/ACP test.

 

o
1997 ý 1998 ý
1999 ý 2000 o
2001

 

b)                                     For the Plan Years marked, the Employer
used the current year testing method for the PDP/ACP test.

 

ý
1997 o 1998 o
1999 o 2000 o
2001

 

Complete (c) and (d) below if this is a plan that was restated to a
Principal Financial Group plan document after December 31, 1996 and the
ADP and ACP tests. used different testing methods.

 

c)                                      For
the Plan Years marked, the Employer used the prior year testing method for the
ADP test and the current year testing method for the ACP test.

 

o
1997 o 1998 o
1999 o 2000 o
2001

 

d)                                     For
the Plan Years marked, the Employer used the current year testing method for
the ADP test and the prior year testing method for the ACP test.

 

o
1997 o 1998 o
1999 o 2000 o
2001

 

 

1

 

e)                                      For
the Plan Year marked, the Employer used 3% as the nonhighly compensated
employees ADP.

 

o
1997 o 1998 o
1999 o 2000 o
2001

 

Distribution Requirements (Minimum Distributions)

 

a)                                      The
plan will apply the minimum distribution requirements of Code Section 401(a)(9)
in accordance with the 2001 Proposed Regulations for distributions made on or
after June 14, 2001, for calendar years beginning on or after January 1,
2001, unless otherwise specified below.

 

1)                                      o These provisions will be applied for
distributions made on or after
                             
for calendar years beginning on or after January 1, 2001. Such date shall
be substituted for June 14, 2001, in the applicable provisions of the
Plan.

 

2)                                      o These provisions will be applied for
all distributions made for calendar years beginning on or after January 1,
2001.

 

3)                                      o These provisions will be applied for
all distributions made for calendar years beginning on or after January 1,
2002. These provisions will not be applied for distributions made for the 2001
calendar year.

 

Compensation Definition (Qualified Transportation Fringe Benefits)

 

a)                                      Amounts
excludible from the gross income of the Employee by reason of Code Section 132(0(4)
shall not be included in any definition of Compensation for years beginning
before January 1, 2001, unless otherwise specified below.

 

1)                                      o
Such amounts shall be included for years beginning January 1.                                                    
.. (Must be 1998, 1999, or 2000.)

 

Eligible Rollover Distributions (Hardship Distributions)

 

a)                                      Hardship
distributions made after December 31, 1998 are not Eligible Rollover
Distributions, unless otherwise specified below.

 

1)                                      o Hardship distributions made after December 31,
1999 are not Eligible Rollover Distributions.

 

2)                                      o Hardship
distributions made after are not Eligible Rollover Distributions. (Must be
between January 1, 1999 and December 31, 1999)

 

401(k) Safe Harbor Provisions

 

a)                                      For the Plan Years marked, the plan operated
as a 401(k) safe harbor plan.

 

o 1999 o 2000 o 2001

 

2

 

b)                                     The 401(k) safe harbor provisions satisfied
the ADP/ACP test safe harbors as specified in the plan document, unless
otherwise specified below.

 

1)                                      o The 401(k) safe harbor provisions satisfied
the ADP/ACP test safe harbors for the 1999 Plan Year for

 

o ADP/ACP                    
o ADP only

 

2)                                      o The
401(k) sale harbor provisions satisfied the ADP/ACP test safe harbors for the
2000 Plan Year for

 

o ADP/ACP                    
o ADP only

 

3)                                      o The 401(k) safe harbor provisions satisfied
the ADP/ACP test safe harbors for the 2001 Plan Year for

 

o ADP/ACP                    
o ADP only

 

c)                                      The ADP Test Safe Harbor was satisfied using
the contributions specified in the plan document, unless otherwise specified
below.

 

1)                                      o For the 1999 Plan Year the ADP Test Safe
Harbor was satisfied using

 

o Qualified matching contribution - basic
formula.

 

o Qualified matching contribution - enhanced
formula

 

o Qualified nonelective contribution

 

2)                                      o For the 2000 Plan Year the ADP Test Safe
Harbor was satisfied using

 

o Qualified matching contribution - basic
formula.

 

o Qualified matching contribution - enhanced
formula

 

o Qualified nonelective contribution.

 

 

3

 

 

Complete
these sections it the plan restated to a Principal Financial Group plan
document after December 31, 1996 or this is an individually designed plan
document.

 

Small
Amounts (Involuntary Distributions.)

 

a)                                     The involuntary distribution cash out limit
(small amounts limit) was $3,500 for Plan Years beginning before August 6,
1997 and was increased to $5,000 for Plan Years beginning on or after August 7,
1997, unless otherwise specified below.

 

Sub.

 

1)                                      o
The involuntary distribution cash out limit was increased to $5,000 on                 .
(The date the plan restated to a Principal Financial Group prototype or
individually designed plan document with the above involuntary distribution
cash out limit or an earlier date if applicable.)

 

2)                                      o
Prior to            the
involuntary distribution cash out limit was         
not included in the plan document
        $       
Note (3) and (4) are only available on an individually designed plan document.

 

3)                                      ý
The involuntary distribution cash out limit is stated in the plan document.

 

4)                                      o
The involuntary distribution cash out limit is not included in the plan
document

 

4

 

Repeal of Family
Aggregation

 

a)                                     For the Plan Years marked, the Employer
applied the family aggregation rules for determining the amount of
contributions made for or allocated to a member.

 

o 1997 o 1998 o 1999 o 2000 o 2001

 

5

 

GTSI Corp.

 

3901 Stonecroft boulevard Chantilly,
VA2015I-1010

 

AMENDMENT TO ADD TRANSACTION PROCESSING SECTION

 

GTSI
CORP. 401(K INVESTMENT PLAN)

 

The Plan named above
gives the Employer the right to amend it at any time. According to that right,
the Plan is amended effective as of the signature date below, as follows:

 

By adding to the Table
of Contents the following Section 9.08:

 

Section 9.08
            Transaction
Processing By adding the following Section 9.08 to Article IX:

 

SECTION 9.08—TRANSACTION
PROCESSING.

 

Transactions (including, but
not limited to, investment directions, trades, loans, and distributions) shall
be processed as soon as administratively practicable after proper directions
are received from the Participant or such other parties. No guarantee is made
by the Plan, Plan
Administer, Trustee, Insurer, or Employer that such transactions will be
processed on a daily or other basis, and no guarantee is made in any respect
regarding the processing time of such transactions.

 

Nothwithstanding
any other provision of the Plan, the Employer, the Plan Administrator, or the
Trustee reserves the right to not value an investment option on any given
Valuation Date for any reason deemed appropriate by the Employer, the Plan
Administrator, or the Trustee. Administrative practicality will be determined
by legitimate business factors (including, but not limited to, failure of
systems or computer programs, failure of the means of the transmission of data,
force majeure, the failure of a service provider to timely receive values or
prices, and correction for errors or omissions or the errors or omissions of
any service provider) and in no event will be deemed to be less than 14 days.
The processing date of a transaction shall be binding for all purposes of the
Plan and considered the applicable Valuation Date for any transaction.

 

This amendment is made
an integral part of the aforesaid Plan and is controlling over the terms of
said Plan with respect to the particular items addressed expressly herein. All
other provisions of the Plan remain unchanged and controlling.

 

1

 

Unless otherwise stated on any page of this amendment, eligibility for
benefits and the amount of any benefits payable to or on behalf of an
individual who is an Inactive Participant on the effective date(s) stated
above, shall be determined according to the provisions of the aforesaid Plan as
in effect on the day before he became an Inactive Participant.

 

 

	
  Signed this 31 day of

  	
  December 2003

  	
   

  
	
   

  	
   

  	
   

  
	
  For the Employer

  
	
   

  
	
  By

  	
  /s/ Bridget Atkinson

  	
   

  
	
  Bridget Atkinson

  
	
   

  
	
  Title

  	
  VP, HR

  	
   

  
							

 

2

 

TO COMPLY WIH THE 401(a)(9) FINAL AND TEMPORARY REGULATIONS

 

 

 

TO
COMPLY WIH THE 401(a)(9) FINAL AND TEMPORARY REGULATIONS

 

Plan
Name GTSI CORP. 401(K)INVESTMENT PLAN

 

The plan named above gives the Employer the right to amend it at any
time. According to that right, the Plan is amended by adopting the model
amendment set forth below.

 

The plan’s existing minimum distribution provisions are superseded to
the extent they are inconsistent with the provisions of this model amendment,
but those provisions that are not inconsistent (such as the plan’s definition
of required beginning date) shall be retained. The plan’s minimum distribution
provisions are amended as follows:

 

ARTICLE VII. MINIMUM DISTRIBUTION REQUIREMENTS. Section 1.
General Rules

 

1.1.                              Effective
Date. The provisions of this article will apply for purposes of
determining required minimum distributions for calendar years beginning with
the 2003 calendar year.

 

1.2.                              Coordination
with Minimum Distribution Requirements Previously in Effect- This amendment is
not-effective until calendar years beginning with the 2003 calendar year,
therefore, no coordination is required.

 

1.3.                              Precendence.
The requirements of this article will take precedence over any
inconsistent provisions of the plan.

 

1.4.                              Requirements
of Treasury Regulations Incorporated. All distributions required under this article
will be determined and made in accordance with the Treasury regulations under section 401(a)(9)
of the Internal Revenue Code.

 

1.5                                 TEFRA
Section 242(b)(2) Elections. Notwithstanding the other provisions of this
article, distributions may be made under a designation made before January 1,
1984, in accordance with section 242(b)(2) of the Tai. Equity and Fiscal
Responsibility Act (TEFRA) and the provisions of the plan that relate to section 242(b)(2)
of TEFRA.

 

Section 2.
Time and Manner of Distribution.

 

2.1                                 Required
Beginning Date. The participant’s entire interest will be distributed, or begin
to be distributed, to the participant no later than the participant’s required
beginning date.

 

 

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

 

(a)                                  if
the participant’s surviving spouse is the participant’s sole designated
beneficiary, then distributions to the surviving spouse will begin by December
31 of the calendar year immediately following the calendar year in which the
participant would have attained age 70 1/2 if later, except to the extent that
an election is made to receive distributions in accordance with the 5-year
rule. Under the 5-year rule, the participant’s entire interest will be
distributed to the designated beneficiary by December 31 of the calendar
year containing the fifth anniversary of the participant’s death.

 

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

 

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

 

(d)                                 If
the participant’s surviving spouse is the participant’s sole designated
beneficiary and the surviving spouse dies after the participant but before
distributions to the surviving spouse begin, this section 2.2, other than section 2.2(a),
will apply as if the surviving spouse were the participant.

 

For purposes of this section 2.2. and section 4,
unless section 2.2(d) applies, distributions are considered to begin on
the participant’ required beginning date. If section 2.2(d) applies,
distributions are considered to begin on the date distributions are required to
begin to the surviving spouse under section 2.2(a). If distributions under
an annuity purchased from an insurance company irrevocably commence to the
participant before

 

2

 

the participant’s required beginning date (or to
the participant’s surviving spouse before the date distributions are required
begin to the surviving spouse under section 2.2(a)), the date
distributions are considered to begin is the date distributions actually
commence.

 

2.3.                              Forms
of Distribution. Unless the participant’s interest is distributed in the form
of an annuity purchased from an insurance company or in a single sum on or
before the required beginning date, as of the first distribution calendar year
distributions will be made in accordance with sections 3 and 4 of this article.
If the participant’s interest is distributed in the form of an annuity
purchased from an insurance company, distributions thereunder will be made in
accordance with the requirements of section 40l(a)(9) of the code and the
Treasury regulations.

 

Section 3. Required
Minimum Distributions During Participant’s Lifetime.

 

3.1.                              Amount
of Required Minimum Distribution For Each Distribution Calendar Year. During
the participant’s lifetime, the minimum amount that will distributed for each
distribution calendar year is the lesser of:

 

(a)                                  the
quotient obtained by dividing the participant’s account balance by the
distribution period in the Uniform Lifetime Table set forth in section 1.401(a)(9)—9
of the Treasury regulations, using the participant’s age as of the participant’s
birthday in the distribution calendar year; or

 

(b)                                 if
the participant’s sole designated beneficiary for the distribution calendar
year is the participant’s spouse, the quotient obtained by dividing the
participant’s account balance by the number in the Joint and Last Survivor
Table set forth in section l-401(a)(9)-9 of the Treasury regulations,
using the participant’s and spouse’s attained ages as of the participant’s and
spouse’s birthdays in the distribution calendar year.

 

3.2.                              Lifetime
Required Minimum Distributions Continue Through Year of Participant’s Death.
Required minimum distributions will be determined under this section 3
beginning with the first distribution calendar year and up to and including the
distribution calendar year that includes the participant’s date of death.

 

Section 4. Required Minimum Distributions After Participant’s
Death.

 

4.1.                              Death
On or After Date Distributions Begin.

 

3

 

(a)                                  Participant
Survived by Designated Beneficiary. If the participant dies on or after the
date distributions begin and there is a designated beneficiary; the minimum
amount that will be distributed for each distribution calendar year after the
year of the participant’s death is the quotient obtained by dividing the
participant’s account balance by the longer of the remaining life expectancy of
the participant or the remaining life expectancy of the participant’s
designated beneficiary, determined as follows:

 

(1)                                  The
participant’s remaining life expectancy is calculated using the age of the
participant in the year of death, reduced by one for each subsequent year.

 

(2)                                  If
the participant’s surviving spouse is the participant’s sole designated
beneficiary, the remaining life expectancy of the surviving spouse is
calculated for each distribution calendar year after the year of the
participant’s death using the surviving spouse’s age as of the spouse’s birthday
in that year. For distribution calendar years after the year of the surviving
spouse’s death, the remaining life expectancy of the surviving spouse is
calculated using the age of the surviving spouse as of the spouse’s birthday in
the calendar year of the spouse’s death, reduced by one for each subsequent
calendar year.

 

(3)                                  If
the participant’s surviving spouse is not the participant’s sole designated
beneficiary, the designated beneficiary’s remaining life expectancy is
calculated using the age of the beneficiary in the year following the year of
the participant’s death, reduced by one for each subsequent year.

 

(b)                                 No
Designated Beneficiary. If the participant dies on or after the date
distributions begin and there is no designated beneficiary as of September 30
of the year after Vie year of the participant’s death, the minimum amount that
will be distributed for each distribution calendar year after the year of the
participant’s death is the quotient obtained by dividing the participant’s
account balance by the participant’s remaining life expectancy calculated using
the age of the participant in the year of death, reduced by one for each
subsequent year.

 

4.2.                              Death
Before Date Distributions Begin.

 

(a)                                  Participant
Survived by Designated Beneficary. If the participant dies before the date
distributions begin and there is a designated beneficiary, the minimum amount
that will be distributed for each distribution calendar year after the year of the participant’s death is the
quotient obtained by dividing the participant’s account balance by the
remaining life expectancy of the

 

4

 

the year of the participant’s death is the
quotient obtained by dividing the participant’s account balance by the
remaining life expectancy of the participant’s designated beneficiary,
determined as provided in section 4.1, except to the extent that an
election is made to receive distributions in accordance with the 5-year rule.
Under the 5-year rule, the participant’s entire interest will be distributed to
the designated beneficiary by December 31 of the calendar year containing
the fifth anniversary of the participant’s death.

 

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

 

(c)                                  Death
of surviving Spouse Before Distributions to Surviving Spouse Are Required to
Begin. If the participant dies before the date distributions begin, the
participant’s surviving spouse is the participant’s sole designated
beneficiary, and the surviving spouse dies before the distributions are
required to begin to the surviving spouse under section 2.2(a), this section 4.2
will apply as if the surviving spouse were the participant.

 

Section 5. Definitions.

 

5.1.                              Designated
beneficiary. The individual who is designated as the beneficiary under the
BENEFICIARY SECTION of Article X of the plan and is the designated
beneficiary under section 401(a)(9) of the Internal Revenue Code and section 1-401(a)(9)-I,
Q&A-4, of the Treasury regulations.

 

5

 

5.2.                              Distribution
calendar year. A calendar year for which a minimum distribution is required.
For distributions beginning before the participant’s death, the first
distribution calendar year is the calender year immediately preceding the
calendar year which contains the participant’s required beginning date. For
distributions beginning after the participant’s death, the first distribution
calendar year is the calendar year in which distributions are required to begin
under section 2.2. The required minimum distribution for the participant’s
first distribution calendar year will be made on or before the participant’s
required beginning date. The required minimum distribution for other
distribution calendar years, including the required minimum distribution for
the distribution year in which the participant’s required beginning date
occurs, will be made on or before December 31 of that distribution
calendar year.

 

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

 

5.4.                              Participant’s
account balance. The account balance as of the last valuation date in the
calendar year immediately preceding the distribution calendar year (valuation
calendar year) increased by the amount of any contributions made and allocated
or forfeitures allocated to the account balance as of dates in the valuation
calendar year after the valuation date and decreased by distributions made in
the valuation year after the valuation date. The account balance for the
valuation calendar year includes any amounts rolled over or transferred to the
plan either in the valuation calendar year or in the distribution calendar year
if distributed or transferred in the valuation calendar year.

 

5.5.                              Required
beginning date. The date specified in the DEFINITIONS SECTION of Article VII
of the plan.

 

Section 6. Election to Allow Participants or Beneficiaries to
Elect 5-Year Rule.

 

Participants or beneficiaries may elect on an
individual basis whether the 5-year rule or the life expectancy rule in
sections 2.2 and 4.2 of Article VII of the plan applies to distributions
after the death of a participant who has a designated beneficiary. The election
must be made no later than the earlier of September 30 of the calendar
year in which distribution would be required to begin under section 2.2 of
Article VII of the plan, or by September 30 of the calendar year
which contains the fifth anniversary of the participant’s (or, if applicable,
surviving spouse’s) death. If neither the participant nor beneficiary makes an
election under this paragraph, distributions will be made in accordance with
the life expectancy rule under sections 2.2 and

 

6

 

4.2 of Article vii of the plan.

 

Section 7. Election to Allow Designated Beneficiary Receiving
Distributions Under 5-Year Rule to Elect Life Expectancy Distributions.

 

A designated beneficary who is
receiving payments under the 5-year rule may make a new election to receive
payments under the life expectancy rule until December 31, 2003, provided
that all amounts that would have been required to be distributed under the life expectancy rule for all distribution
calendar years before 2004 are distributed by the earlier of December 31,
2003 or the end of the 5-year period.

 

This amendment is made an integral part of the aforesaid Plan and is
controlling over the terms of said Plan with respect to the particular items
addressed expressly therein. All other provisions of the Plan remain unchanged
and controlling.

 

Unless otherwise stated on any page of this amendment, eligibility for
benefits and the amount of any benefits payable to or on behalf of an
individual who is an Inactive Participant on the effective date(s) stated
above, shall be determined according to the provisions of the aforesaid Plan as
in effect on the day before he became an Inactive Participant.

 

Signing this amendment, the Employer, as plan sponsor, has made the
decision to adopt this plan amendment. The Employer is acting in reliance on
its own discretion and on the legal and tax advice of its own advisors, and not
that of any member of the Principal Financial Group or any representative of a
member company of the Principal Financial Group.

 

	
  Signed this 31st day of December 2003

  
	
  For the Employer,

  
	
   

  
	
   

  
	
  By

  	
  /s/ Bridget Atkinson

  	
   

  
	
   

  	
  Bridget Atkinson

  
	
   

  	
   

  
	
   

  	
  VP HR

  	
   

  
	
   

  	
  Business Title

  
				

 

7

 

GOOD FAITH

COMPLIANCE AMENDMENT FOR THE

ECONOMIC GROWTH OF 2001 (EGTRRA)

 

This amendment of the Plan is adopted to
reflect certain provisions of the Economic Growth and Tax Relief Reconciliation
Act of 2001 (EGTRRA). This amendment is intended as good faith compliance with
the requirements of EGTRRA and is to be construed in accordance with EGTRRA and
guidance issued thereunder. Except as otherwise provided, this amendment shall
be effective as of the first day of the first Plan Year beginning after December 31,
2001.

 

This amendment shall supersede the provisions
of the Plan to the extent those provisions are inconsistent with the provisions
of this amendment

 

Government Technology

 

The Plan named above gives the Employer the
right to amend it at any time. According to that right, the Plan is amended as follows:

 

INCREASE IN COMPENSATION LIMIT

For Plan Years beginning on and after January 1,
2002, the annual Compensation of each Participant taken into account for
determining all benefits provided under the Plan for any determination period
shall not exceed $200,000, as adjusted 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 Compensation for any prior determination
period is taken into account in determining a Participant’s contributions or
benefits for the current Plan Year, the Compensation for such prior
determination period is subject to the applicable annual compensation limit in
effect for that determination period. For this purpose, in determining
contributions or benefits in Plan Years beginning on or after January 1,
2002, the annual Compensation limit in effect for determination periods
beginning before that date is $200,000.

 

LIMITATIONS ON
CONTRIBUTIONS

Effective date. This
section shall be effective for Limitation Years beginning after December 31,
2001.

 

Maximum Annual Addition. Except to the extent
permitted in the Catch-up Contributions section of this amendment that
provides for catch-up contributions under EGTRRA section 631 and Code Section 414(v),
if applicable, the Annual Addition that may be contributed or allocated to a
Participant’s Account underthe Plan for any Limitation Year shall not exceed
the lesser of:

 

a)       $40,000, as adjusted for increases in
the cost-of-living under Code Section 415(d), or

 

b)       100 percent of the Participant’s
Compensation, for the Limitation Year.

 

The compensation limitation referred to in
(b) shall not apply to any contribution for medical benefits after separation
from service (within the meaning of Code Section 401(h) or 419A(f)(2))
which is otherwise treated as an Annual Addition.

 

Elective Deferral Limits. The cap (or the
choice to not include a cap) on Elective Deferral Contributions will not change,
unless otherwise specified below.

 

a)       (Increase the cap.) Increase the cap
on Elective Deferral Contributions to
                                  
% of Compensation.

 

 

1

 

 

b)       (Remove the
cap.) The cap on Elective Deferral Contributions shall no longer apply.

 

c)
      (Add a cap.) The Plan does not currently cap
Elective Deferral Contributions. A participant may not defer more
than            %
of his Compensation for (Select one.)

 

i)                                         o
for the Plan Year

 

ii)                                      o
for the pay period.

 

iii)                                   o
for the month.

 

Voluntary After-tax Contributions. Voluntary Contributions will not be
added to the Plan, unless otherwise specified below.

 

Modification of
definition of Eligible Rollover Distribution to exclude hardship distributions.
For purposes of the DIRECT ROLLOVER Section, any amount that is distributed on
account of hardship shall not be an Eligible Rollover Distribution and the
Distributee may not elect to have any portion of such a distribution paid
directly to an Eligible Retirement Plan.

 

Plan implementing the requirements of Code Section 401(k)(3),
401(k)(11), 401(k)(12), 410(b), or 416, as applicable, by reason of the making
of such catch-up contributions.

 

a)        Catch-up
Contributions are not permitted.

 

DIRECT ROLLOVERS OF PLAN DISTRIBUTIONS

Effective date. This section shall apply
to distributions made after December 31, 2001.

 

Modification of definition of Eligible
Retirement Plan. For purposes of the DIRECT ROLLOVER
Section. an Eligible Retirement Plan shall also mean an annuity contract
described in Code Section 403(b) and an eligible plan under Code Section 457(b)
which is maintained by a state, political subdivision of a state, or any agency
or instrumentality of a state or political subdivision of a state and which
agrees to separately account for amounts transferred into such plan from this
Plan. The definition of Eligible Retirement Plan shall also apply in the case
of a distribution to a surviving spouse, or to a spouse or former spouse who is
the alternate payee under a qualified domestic relations order, as defined in
Code Section 414(p).

 

 

 

2

 

Modification of definition of Eligible
Rollover Distribution to include after-tax employee contributions.
For purposes of the DIRECT ROLLOVER Section, a portion of a distribution shall
not fail to be an Eligible Rollover Distribution merely because the portion
consists of after-tax employee contributions which are not includible in gross
income. However, such portion may be transferred only to an individual
retirement account or individual retirement annuity described in Code Section 408(a)
or (b), or to a qualified defined contribution plan described in Code Section 401(a)
or 403(a) that agrees to separately account for amounts so transferred,
including separately accounting for the portion of such distribution which is
includible in gross income and the portion of such distribution which is not so
includible.

 

ROLLOVERS FROM OTHER PLANS

 

The Plan will accept Participant Rollover
Contributions and/or direct rollovers of distributions made after December 31,
2001 from the types of plans specified below beginning January 1, 2002.
The Plan will accept all of the following sources of rollovers, unless otherwise
specified in (a) below

 

Direct
Rollovers

The Plan will accept a direct rollover of an
Eligible Rollover Distribution from:

p a qualified plan described in Code Section 401
(a) or 403(a), including after-tax employee contributions.

 

	
  ii)

  	
   

  	
  an annuity contract described in Code
  Section 403(b), excluding after-tax employee contributions.

  
	
   

  	
   

  	
   

  
	
  iii)

  	
   

  	
  an eligible plan under Code
  Section 457(b) which Is maintained by a state, political subdivision of
  a state, or any agency or instrumentality of a state or political subdivision
  of a state.

  

 

Participant Rollover Contributions
from Other Plans

 

The Plan will accept a Participant
contribution of an Eligible Rollover Distribution from:

 

i)
      a qualified plan described in Code Section 401 (a) or
403(a).

 

 

3

	
  ii)

  	
   

  	
  an annuity contract described in Code Section 403(b).

  
	
   

  	
   

  	
   

  
	
  iii)

  	
   

  	
  an eligible plan under Code Section 457(b) which is maintained by
  a state, political subdivision of a state, or any agency or instrumentality
  of a state or political subdivision of a state.

  

 

Participant Rollover Contributions from IRAs

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

 

(Select (a) if you want to allow only certain
sources of rollovers.)

 

	
  a)

  	
   

  	
  o  The
  Plan will accept Participant Rollover Contributions and/or direct rollovers
  of distributions made after December 31, 2001 from the types of plans
  specified below beginning January 1, 2002. (Select any that apply.)

  

 

Direct Rollovers

 

The Plan will accept a direct
rollover of an Eligible Rollover Distribution from:

 

	
  i)

  	
   

  	
  o  a qualified plan described in Code Section 401
  (a) or 403(a), including after-tax employee contributions,

  
	
   

  	
   

  	
   

  
	
  ii)

  	
   

  	
  o  a qualified plan described in Code Section 401(a)
  or 403(a), excluding after-tax employee contributions. (Cannot select if (i) is
  selected.).

  
	
   

  	
   

  	
   

  
	
  iii)

  	
   

  	
  o  an annuity contract described in Code section 403(b),
  excluding after-tax employee contributions.

  
	
   

  	
   

  	
   

  
	
  iv)

  	
   

  	
  o  an
  eligible plan under Code Section 457(b) which is maintained by a state,
  political subdivision of a state, or any agency or instrumentality of a state
  or political subdivision of a state.

  

 

Participant
Rollover Contributions from Other Plans

 

The Plan will
accept a Participant contribution of an Eligible Rollover Distribution from:

 

	
  i)

  	
   

  	
  o  a
  qualified plan described in Code Section 401 (a) or 403(a).

  
	
   

  	
   

  	
   

  
	
  ii)

  	
   

  	
  o  an
  annuity contract described in Code Section 403(b).

  
	
   

  	
   

  	
   

  
	
  iii)

  	
   

  	
  o  an
  eligible plan under Code Section 457(b) which is maintained by a state,
  political subdivision of a state, or any agency or instrumentality of a state
  or political subdivision of a state.

  

 

Participant Rollover Contributions
from IRAs

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

 

i)                 Participant
Rollover Contributions from IRAs are not permitted.

 

4

 

ROLLOVERS DISREGARDED IN INVOLUNTARY CASH-OUTS

 

Rollover Contributions will
be included in determining the value of account balances for involuntary
distributions, unless otherwise specified below. (NOTE Can only select (a) if
the Plan is not subject to the qualified joint and survivor annuity
requirements of Code Sections 401(a)(11) and 417.)

 

	
  a)

  	
   

  	
  Rollover
  Contributions are excluded in determining the value of the Participant’s
  nonforfeitable balance for purposes of the Plan’s involuntary cash-out rules
  for distributions made after
                                                                                  
  ,
                                   (No
  earlier than December 31, 2001.) with respect to Participants who separated
  from service after                   ,
                   
  . (The date may be earlier than December 31, 2001.)

  

 

REPEAL OF MULTIPLE USE TEST

The multiple use test described
in Treasury Regulation section 1.401(m)-2 and the EXCESS AMOUNTS Section shall
not apply for Plan Years beginning after December 31, 2001.

 

DISTRIBUTION UPON SEVERANCE
FROM EMPLOYMENT

Effective date. This section shall
apply for distributions due to severance from employment occurring after December 31,
2001 and distributions that are processed after December 31, 2001
regardless of when the severance from employment occurred.

 

New distributable event -
Distribution Upon Severance From Employment. A Participant’s Elective Deferral
Contributions, Qualified Nonelective Contributions, Qualified Matching
Contributions, and earnings attributable to these Contributions shall be
distributed on account of the Participant’s severance from employment. However,
such a distribution shall be subject to the other provisions of the Plan
regarding distributions, other than provisions that require a separation from
service before such amounts may be distributed.

 

SUSPENSION PERIOD FOLLOWING
HARDSHIP DISTRIBUTION

If the Plan allows
hardship distributions and the deemed hardship provisions are used, the suspension
period following a hardship distribution will be decreased, unless otherwise
specified in (a) below. A Participant who receives a distribution of elective
deferrals after December 31, 2001, on account of hardship shall be
prohibited from making elective deferrals and participant contributions under
this and all other plans of ours for six months after receipt of the
distribution-A Participant who receives a distribution of elective deferrals in
calendar year 2001 on account of hardship shall be prohibited from making
elective deferrals and participant contributions under this and all other plans
of ours for six months after receipt of the distribution or until January 1,
2002, if later.

 

a)                                      The suspension period
will not change. (Not available for 401 (k) Safe Harbor plans.)

 

MODIFICATION OF TOP-HEAVY RULES

Effective date. This section shall apply for purposes of
determining whether the Plan is a Top-heavy Plan for Plan Years beginning after
December 31, 2001, and whether the Plan satisfies the minimum benefits
requirements of Code Section 416(c) for such years. This section amends
the TOP HEAVY PLAN REQUIREMENTS Section of the Plan.

 

5

 

Determination of top-heavy Status.

Key Employee means
any Employee or former Employee (and the Beneficiaries of such Employee) who at
any time during the determination period was:

 

a) an officer of ours if such individual’s
annual Compensation is more than $130,000 (as adjusted under Code Section 416(1)(1)
for Plan Years beginning after December 31, 2002),

 

b) a 5-percent owner of us, or

 

c) a 1-percent owner of us who has annual
Compensation of more than $150,000.

 

The determination period is the Plan Year containing the Determination
Date.

 

The determination of who is a Key Employee shall be made according to
Code Section 416(1)(1) and the applicable regulations and other guidance
of general applicability issued thereunder.

 

Determination of present values and amounts.
This section shall apply for purposes of determining the present values of
accrued benefits and the amounts of account balances of Employees as of the
Determination Date.

 

Distributions during year ending on the Determination Date. The present
values of accrued benefits and the amounts of account balances of an Employee
as of the Determination Date shall be increased by the distributions made with
respect to the Employee under the Plan and any plan aggregated with the Plan
under Code Section 416(g)(2) during the one-year period ending on the
Determination Date. The preceding sentence shall also apply to distributions
under a terminated plan which, had it not been terminated, would have been
aggregated with the Plan under Code Section 416(g)(2)(A)(i) In the case of
a distribution made for a reason other than separation from service, death, or
disability, this provision shall be applied by substituting “five-year period’
for one-year period

 

Employees not performing services during year
ending on the Determination Date. The accrued benefits
and accounts of any individual who has not performed services for us during the
one-year period ending on the Determination Date shall not be taken into
account.

 

Minimum benefits.

Matching contributions.
Employer matching contributions shall be taken into account for purposes of
satisfying the minimum contribution requirements of Code Section 416(c)(2)
and the Plan. The preceding sentence shall apply with respect to Matching
Contributions under the Plan or, if the Plan provides that the minimum
contribution requirement shall be met in another plan, such other plan.
Employer matching contributions that are used to satisfy the minimum
contribution requirements shall be treated as matching contributions for
purposes of the actual contribution percentage test and other requirements of
Code Section 401(m).

 

Contributions under other plans. We may provide in the Plan that the minimum benefit
requirement shall be met in another plan (including another plan that consists
solely of a cash or deferred arrangement which meets the requirements of Code Section 401(k)(12)
and matching contributions with respect to which the requirements of Code Section 401(m)(11)
are met).

 

PLAN LOANS FOR OWNER-EMPLOYEES AND
SHAREHOLDER EMPLOYEES

Effective for plan loans made after December 31, 2001, plan provisions
prohibiting loans to any shareholder-employee or Owner-employee shall cease to
apply

 

 

6

 

	
  Signed this 28th day of
  December, 2001

  
	
   

  
	
  /s/ Susan Estes

  	
   

  
	
  Susan Estes

  
	
   

  	
   

  
	
  Title

  
			

 

7

 

AMENDMENT NO. I

 

 

 

AMENDMENT NO. I

 

GTSI EMPLOYEES’ 401(k)
INVESTMENT PLAN

 

The Plan named above gives the Employer the
right to amend it at any time. According to that right, the plan is amended as
of January 1, 2002, as follows:

 

By striking the Title Page and substituting
the following: GTSI CORP. 401(k) INVESTMENT PLAN

 

The provisions and conditions set forth on
any page of this amendment are a part of the Plan as fully as if recited over
the signature(s) below.

 

Unless otherwise stated on any page of this
amendment, eligibility for benefits and the amount of such benefits payable to
or on behalf of an individual who is an Inactive Participant on the effective
date(s) stated above, shall be determined according to the provisions of the
Plan as in effect on the day before he became an Inactive Participant.

 

By signing this amendment, the Employer acknowledges having counseled
to the extent necessary with selected legal and tax advisors regarding the
amendment’s legal and tax implications.

 

Signed this 14th day of November, 2002

 

	
  GTSI Corp.

  
	
   

  
	
   

  
	
  By

  	
  /s/ Bridget Atkinson

  	
   

  
	
   

  
	
   

  
	
  Bridget Atkinson

  
	
   

  
	
   

  
	
  VP, Human Resources

  	
   

  
				

 

 

1

 

Your plan is an important legal
document. This sample plan has been prepared based on our understanding of the
desired provisions. It may not fit your situation. You should consult with your
lawyer on the plan’s legal and tax implications. Neither Principal Life
Insurance Company nor its agents can be responsible for the legal or tax
aspects of the plan nor its appropriateness for your situation. If you wish to
change the provisions of this sample plan, you may ask us to prepare new sample
wording for you and your lawyer to review.Exhibit
10.12

 

FIRST
AMENDMENT TO

CREDIT
FACILITIES AGREEMENT

 

This FIRST AMENDMENT TO
CREDIT FACILITIES AGREEMENT (this “Agreement”) is entered into and effective as
of March 12, 2004, by and among GTSI Corp, a Delaware corporation (“Borrower”),
GE Commercial Distribution Finance Corporation (“GECDF”), as Administrative
Agent, and GECDF and the other Lenders.

 

Recitals:

 

A.                                    Borrower, Administrative Agent and Lenders
are party to that certain Credit Facilities Agreement dated as of October 20
2003 (the “Original Credit Agreement”).

 

B.                                    Administrative Agent, Lenders and Borrower
have agreed to the provisions set forth herein on the terms and conditions
contained herein.

 

Agreement

 

Therefore, in consideration
of the mutual agreements herein and other sufficient consideration, the receipt
of which is hereby acknowledged, Borrower, Administrative Agent and the Lenders
hereby agree as follows:

 

1.              Definitions.  All references to the “Agreement” or the “Credit
Agreement” in the Original Credit Agreement and in this Agreement shall be
deemed to be references to the Original Credit Agreement as it may be amended,
restated, extended, renewed, replaced, or otherwise modified from time to
time.  Capitalized terms used and not
otherwise defined herein have the meanings given them in the Original Credit
Agreement.

 

2.              Effectiveness
of Agreement.  This Agreement shall become effective as of
the date first written above, but only if this Agreement has been executed by
Borrower, Administrative Agent and the Lenders, and only if all of the
documents listed on Exhibit A to this Agreement have been delivered and, as
applicable, executed, sealed, attested, acknowledged, certified, or
authenticated, each in form and substance satisfactory to Administrative Agent
and the Lenders, and the other fundings required by this Agreement have
occurred.

 

3.              New Lender.

 

3.1.              In connection with this Agreement, and
simultaneously with its effectiveness and certain fundings as set forth herein,
SunTrust Bank (“New Lender”) will become a Lender for all purposes under the
Original Credit Agreement and Loan Documents together with the existing Lender
(the “Existing Lender”).  Simultaneously
with the effectiveness of this Agreement and certain fundings as set forth
herein, Exhibit 3 to the Original Credit Agreement is deleted and replaced with
the Exhibit 3 attached hereto.

 

3.2.              Upon the full and
complete execution of this Agreement, the Administrative Agent shall arrange,
and each Lender (including New Lender and the Existing Lender) shall fully cooperate,
in making or receiving, as directed by the Administrative Agent, wire transfers
and fund transfers reasonably necessary to effectuate the pro-rata shares set
forth on Exhibit 3.  Upon such transfer
of funds, this

 

 

Agreement shall be effective
and such effectiveness shall relate back to 8:00 a.m. St. Louis time on the
date of this Agreement.

 

3.3.              New Lender agrees
that, to the extent it has purchased and assumed or be found to have purchased
and assumed from Existing Lender any interest in any Loan that it has purchased
and assumed such interest, without recourse and without representation or
warranty except as expressly set forth in Section 3.4.  Such purchase and assumption shall include
that portion of the Existing Lender’s obligations to fund unfunded Approvals
equal to its percentage of the Floorplan Loans.

 

3.4.              Existing Lender
represents and warrants that it is the legal and beneficial owner of its Loans
and that such interest is free and clear of any adverse claim.

 

3.5.              New Lender
(i) confirms, covenants and agrees that it has received a copy of the
Original Credit Agreement and all prior amendments (if any), the Loan
Documents, together with copies of the Financial Statements referred to therein
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Agreement and become a
Lender, and confirms and covenants that it has entered into this Agreement and
agreed to become a Lender based on its own credit analysis and decision and
without reliance upon any information provided by, or statement made by,
Administrative Agent or any other Lender; (ii) agrees that it will,
independently and without reliance upon the Administrative Agent, any Existing
Lender or any other Lender and based on such documents and information as it
shall deem appropriate at the time, continue to make its own credit decisions
in taking or not taking action under the Original Credit Agreement;
(iii) confirms that it is an Eligible Assignee; (iv) appoints and
authorizes the Administrative Agent to take such action as agent on its behalf
and to exercise such powers and discretion under the Original Credit Agreement
as are delegated to the Administrative Agent by the terms thereof, together
with such powers and discretion as are reasonably incidental thereto;
(v) agrees that it will perform in accordance with their terms all of the
obligations that by the terms of the Original Credit Agreement and the other
Loan Documents are required to be performed by it as a Lender; and
(vi) promptly provide to Administrative Agent any U.S. Internal Revenue
Service or other forms required under the Original Credit Agreement.

 

3.6.              Upon the
effectiveness of this Agreement and the funding by the New Lender of the
amounts directed to be funded by it by the Administrative Agent as set forth in
Section 3.2 hereof, such New Lender shall be a Lender for all purposes
under the Original Credit Agreement and the other Loan Documents.  From and after the effective date of this
Agreement, the Administrative Agent shall make all payments under the Original
Credit Agreement and the Notes consistent with the pro-rata shares of the
Lenders.

 

4.              Amendment.  The
Original Credit Agreement is hereby amended as follows:

 

4.1.              Termination.  A
new Section 3.7 is hereby added to the Credit Agreement as follows:

 

3.7.                            Co-Lender’s Share;
Terminating Lender.               Until all of the Loan Obligations are fully
and indefeasibly paid, no Letters of Credit remain outstanding, the Letter of
Credit Exposure is irreversibly zero and all Facilities are terminated, each
Lender must, subject to Section 18.4 of the Agreement, retain its pro-rata
share of all of the Aggregate Facilities that have not been previously
terminated in accordance with this Agreement and perform all of its obligations
as a Lender hereunder.  Notwithstanding
the preceding sentence, not less than 105 (one hundred five) days prior to the
Initial Maturity Date and each anniversary of the Initial Maturity Date thereafter
(each a “Maturity Date”), each Lender shall notify Administrative Agent in
writing whether or not it desires to terminate the Aggregate Facilities as of
the next Maturity Date.  Any Lender
giving such notice

 

2

 

shall be known as a “Terminating Lender.”  The Administrative Agent shall deliver to
each other Lender any such notice received from a Terminating Lender
immediately upon the Administrative Agent’s receipt.  In the absence of timely notice required
above, Lender shall be deemed to have expressed its desire to renew the
Agreement and to continue as a Lender hereunder through the next Maturity
Date.  Provided that (i) no Event of
Default has occurred and is continuing, (ii) Terminating Lender has given
timely notice of its desire to terminate the Aggregate Facilities as of the
next Maturity Date, and (iii) the Aggregate Facilities are to be renewed by
Borrower and the remaining Lender(s), then, as of the Maturity Date, a
Terminating Lender shall, at the direction of Administrative Agent, assign its
pro-rata share of the Aggregate Facilities to either a substitute Lender or the
remaining Lender(s) on a pro-rata basis. 
Such Lender(s) shall pay the Terminating Lender in full for its pro-rata
share of all Loan Obligations, including the outstanding Loans and accrued but
unpaid interest and fees.  Thereafter,
such Terminating Lender shall be released from its obligations as a Lender
hereunder.

 

4.2.              Maturity.  Section 6.1.2.3
of the Original Credit Agreement is deleted and replaced with the following:

 

6.1.2.3.        Maturity.   Borrower shall repay the entire amount of the Aggregate Revolving Loan
on February 28, 2005 (“Initial Maturity Date”), unless the Aggregate
Revolving Loan Facility continues after the Initial Maturity Date as provided below
in this Section 6.1.2.3.  Borrower
shall repay the amount of the Swingline Loans on demand.  The Aggregate Revolving Loan Facility will
continue from year to year on each anniversary of the Initial Maturity Date
unless Borrower or the Required Lenders give each party hereto written notice
of termination of not less than 90 days prior to the start of a renewal
period.  Each of the Aggregate Floorplan
Loan Facility, the Interim Floorplan Loan Facility and the Swingline Facility
are discretionary and may be terminated at any time as set forth herein, with
or without notice or demand as set forth herein; provided, however, if Borrower
shall give notice of termination of the Aggregate Revolving Loan Facility, then
such notice shall be deemed to be notice of termination for all Facilities in
which case Borrower shall pay the entire amount of the outstanding Loan
Obligations upon the effective date of such notice of termination, including
payment of cash collateral satisfactory to Administrative Agent as security for
Borrower’s obligation to reimburse Administrative Agent or the Letter of Credit
Issuer, as the case may be, for 105% of all draws and expenses under all
outstanding Letters of Credit and 100% of any unfunded Approvals, in which case
such Approvals shall be otherwise paid in accordance with the applicable
Statements of Transaction.

 

4.3.              Maximum Total Liabilities to
Tangible Net Worth.  Section 15.3
of the Original Credit Agreement is deleted and replaced with the following:

 

15.3          Maximum Total Liabilities to Tangible Net Worth.  Borrower
covenants that the ratio of Total Liabilities minus Subordinated Indebtedness
to Tangible Net Worth plus Subordinated Indebtedness calculated as of the last
day of each fiscal month specified in the table below, shall not be more than
the ratio specified in such table opposite said fiscal month

 

	
  Fiscal Month Ended

  	
   

  	
  Maximum Ratio

  
	
  Each July 31, August 31,
  and September 30

  	
   

  	
  6.00:1.00

  
	
   

  	
   

  	
   

  
	
  Each
  January 31, February 28/29, March 31, April 30, May 31, June 30,
  October 31, November 30 and December 31

  	
   

  	
  4.00:1.00

  

 

3

 

4.4.              Additional Definitions.  The following defined terms are hereby added to Exhibit 2.1 Glossary and Index of Defined
Terms:

 

COMMITMENT — a Lender’s
pro rata share of the Aggregate Facilities.

 

EXISTING
DEFAULT — a Default which has occurred and is continuing, or an Event of
Default which has occurred, and which has not been waived in writing by the
Required Lenders.

 

5.              Representations and
Warranties of Borrower.  Borrower hereby represents and warrants to
Administrative Agent and the Lenders that (i) Borrower’s execution of this
Agreement has been duly authorized by all requisite action of Borrower; (ii) no
consents are necessary from any third parties for Borrower’s execution,
delivery or performance of this Agreement, (iii) this Agreement, the Credit
Agreement, and each of the other Loan Documents, constitute the legal, valid
and binding obligations of Borrower enforceable against each such Borrower in
accordance with their terms, except to the extent that the enforceability
thereof against Borrower may be limited by bankruptcy, insolvency or other laws
affecting the enforceability of creditors rights generally or by equity
principles of general application, (iv) except as disclosed on the supplemental
disclosure schedule attached hereto as Exhibit B and the disclosure schedule attached
to the Original Credit Agreement, all of the representations and warranties
contained in Section 12 of the Credit Agreement are true and correct with
the same force and effect as if made on and as of the date of this Agreement,
and (v) after giving effect to this Agreement, there is no Existing Default.

 

6.              Reaffirmation.  Borrower
hereby represents, warrants, acknowledges and confirms that (i) the Credit
Agreement and the other Loan Documents remain in full force and effect, (ii)
Borrower has no defenses to its obligations under the Credit Agreement and the
other Loan Documents, (iii) the Security Interests of the Administrative Agent
(held for the ratable benefit of the Lenders) under the Security Documents
secure all the Loan Obligations under the Credit Agreement, continue in full
force and effect, and have the same priority as before this Agreement, and (iv)
Borrower has no claim against Administrative Agent or any Lender arising from
or in connection with the Credit Agreement or the other Loan Documents and any
such claim is hereby irrevocably waived and released and discharged forever.

 

7.              Governing Law.  This
Agreement shall be governed by and construed under the laws of the State of
Missouri without giving effect to choice or conflicts of law principles
thereunder.

 

8.              Fees and Expenses.  Borrower
shall promptly pay to Administrative Agent an amount equal to 50% of all reasonable
and documented third party fees, costs and expenses incurred by the
Administrative Agent in connection with the preparation, negotiation, execution
and delivery of this First Amendment to Credit Facilities Agreement
(notwithstanding the fact that Section 18.5 of the Original Credit
Agreement may otherwise require Borrower to pay all of such fees, costs and
expenses), and the 50% balance thereof shall be paid by the Administrative
Agent.

 

4

 

9.              Section Titles.  The section titles
in this Agreement are for convenience of reference only and shall not be
construed so as to modify any provisions of this Agreement.

 

10.       Counterparts; Facsimile
Transmissions.  This Agreement may be executed in one or more
counterparts and on separate counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.  Signatures to this Agreement
may be given by facsimile or other electronic transmission, and such signatures
shall be fully binding on the party sending the same.

 

11.       Incorporation By Reference. 
Administrative Agent, Lenders
and Borrower hereby agree that all of the terms of the Loan Documents are
incorporated in and made a part of this Agreement by this reference.

 

12.       Notice—Oral Commitments Not
Enforceable.  The following notice is given pursuant to Section 432.045
of the Missouri Revised Statutes; nothing contained in such notice shall be
deemed to limit or modify the terms of the Loan Documents:

 

ORAL AGREEMENTS
OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FORBEAR FROM ENFORCING
REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT
ENFORCEABLE.  TO PROTECT YOU (BORROWER)
AND US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS WE
REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS THE
COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY
LATER AGREE IN WRITING TO MODIFY IT.

 

13.       Statutory Notice-Insurance.  The
following notice is given pursuant to Section 427.120 of the Missouri
Revised Statutes; nothing contained in such notice shall be deemed to limit or
modify the terms of the Loan Documents:

 

UNLESS YOU
PROVIDE EVIDENCE OF THE INSURANCE COVERAGE REQUIRED BY YOUR AGREEMENT WITH US,
WE MAY PURCHASE INSURANCE AT YOUR EXPENSE TO PROTECT OUR INTERESTS IN YOUR
COLLATERAL.  THIS INSURANCE MAY, BUT NEED
NOT, PROTECT YOUR INTERESTS.  THE
COVERAGE THAT WE PURCHASE MAY NOT PAY ANY CLAIM THAT YOU MAKE OR ANY CLAIM THAT
IS MADE AGAINST YOU IN CONNECTION WITH THE COLLATERAL.  YOU MAY LATER CANCEL ANY INSURANCE PURCHASED
BY US, BUT ONLY AFTER PROVIDING EVIDENCE THAT YOU HAVE OBTAINED INSURANCE AS
REQUIRED BY OUR AGREEMENT.  IF WE
PURCHASE INSURANCE FOR THE COLLATERAL, YOU WILL BE RESPONSIBLE FOR THE COSTS OF
THAT INSURANCE, INCLUDING THE INSURANCE PREMIUM, INTEREST AND ANY OTHER CHARGES
WE MAY IMPOSE IN CONNECTION WITH THE PLACEMENT OF THE INSURANCE, UNTIL THE
EFFECTIVE DATE OF THE CANCELLATION OR EXPIRATION OF THE INSURANCE.  THE COSTS OF THE INSURANCE MAY BE ADDED TO
YOUR TOTAL OUTSTANDING BALANCE OR OBLIGATION. 
THE COSTS OF THE INSURANCE MAY BE MORE THAN THE COST OF INSURANCE YOU
MAY BE ABLE TO OBTAIN ON YOUR OWN.

 

{remainder of page intentionally left blank;
signature page immediately follows}

 

5

 

                                          IN WITNESS WHEREOF, this Agreement has been
duly executed as of the date first above written.

 

	
  GTSI
  CORP., as Borrower

  
	
   

  
	
  By:

  	
       /s/
  Thomas A. Mutryn

  	
   

  
	
  Name: Thomas A. Mutryn

  
	
  Title: Senior Vice
  President and Chief Financial Officer

  
	
   

  
	
   

  
	
  GE
  COMMERCIAL DISTRIBUTION FINANCE CORPORATION,

  
	
  as
  Administrative Agent and a Lender

  
	
   

  
	
  By:

  	
       /s/
  David Mintert

  	
   

  
	
  Name: David Mintert

  
	
  Title: Vice President of
  Operations

  
	
   

  
	
   

  
	
  SUNTRUST
  BANK, as a Lender

  
	
   

  
	
  By:

  	
       /s/
  Mark Swaak

  	
   

  
	
  Name: R. Mark Swaak

  
	
  Title: Vice President

  

 

6

 

Exhibit A

 

Documents
and Requirements

 

1.               First Amendment to Credit Facilities
Agreement.

 

2.               Amended and Restated Revolving Note in the
amount of $72,000,000.00 to GE Commercial Distribution Finance Corporation.

 

3.               Revolving Note in the amount of
$18,000,000.00 to SunTrust Bank.

 

4.               Assignment and Acceptance Agreement between
GE Commercial Distribution Finance Corporation and SunTrust Bank.

 

5.               Notice of Borrowing Officers, certified by
Secretary or Assistant Secretary of Borrower.

 

 

Exhibit B

 

Disclosure
Schedule

 

Nothing, if nothing listed.

 

 

Exhibit 3

 

LENDERS’
FACILITIES AND PRO-RATA SHARES

 

 

	
  LENDER

  	
   

  	
  TOTALS(1)

  	
   

  	
  REVOLVING

  LOAN

  FACILITY

  	
   

  	
  FLOORPLAN

  LOAN

  FACILITY

  	
   

  	
  PRO-RATA

  SHARES

  	
   

  
	
  GE Commercial Distribution Finance

  	
   

  	
  $

  	
  100,000,000.00

  	
   

  	
  $

  	
  72,000,000.00

  	
   

  	
  $

  	
  60,000,000.00

  	
   

  	
  80

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SunTrust
  Bank

  	
   

  	
  $

  	
  25,000,000.00

  	
   

  	
  $

  	
  18,000,000.00

  	
   

  	
  $

  	
  15,000,000.00

  	
   

  	
  20

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  AGGREGATES

  	
   

  	
  $

  	
  125,000,000.00

  	
   

  	
  $

  	
  90,000,000.00

  	
   

  	
  $

  	
  75,000,000.00

  	
   

  	
  100.00000

  	
  %

  

 

(1)  Subject to the Total Aggregate Credit
Facility Limit of $125,000,000 - which can be composed in any combination of
Aggregate Revolving Loans (subject to the $90,000,000 Aggregate Revolving Loan
Facility) and Aggregate Floorplan Loans (subject to the $75,000,000 Aggregate
Floorplan Loan Facility).

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