Document:

Exhibit 10.2

DITECH
NETWORKS, INC.

2006 EQUITY INCENTIVE PLAN

OPTION
AGREEMENT

(NONSTATUTORY STOCK OPTION)

Pursuant to your Option Grant
Notice (“Grant Notice”)
and this Option Agreement, Ditech Networks, Inc. (the “Company”) has granted
you an option under its 2006 Equity Incentive Plan (the “Plan”) to purchase
the number of shares of the Company’s Common Stock indicated in your Grant
Notice at the exercise price indicated in your Grant Notice.  Defined terms not explicitly defined in this
Option Agreement but defined in the Plan shall have the same definitions as in
the Plan.

The details of your option are
as follows:

1.             VESTING.  Subject to the limitations contained herein,
your option will vest as provided in your Grant Notice, provided that vesting
will cease upon the termination of your Continuous Service.

2.             NUMBER
OF SHARES AND EXERCISE PRICE.  The number of shares of Common Stock subject
to your option and your exercise price per share referenced in your Grant
Notice may be adjusted from time to time for capitalization adjustments as set
forth in Section 11(a) of the Plan.

3.             EXERCISE
RESTRICTION FOR NON-EXEMPT EMPLOYEES.  In the event that you are an Employee
eligible for overtime compensation under the Fair Labor Standards Act of 1938,
as amended (i.e., a “Non-Exempt Employee”),
you may not exercise your option until you have completed at least six (6)
months of Continuous Service measured from the Date of Grant specified in your
Grant Notice, notwithstanding any other provision of your option.

4.             METHOD
OF PAYMENT. 
Payment of the exercise price is due in full upon exercise of all or any
part of your option.  You may elect to
make payment of the exercise price in cash or by check or in any other manner permitted by your Grant Notice,
which may include one or more of the following:

(a)           Provided that at
the time of exercise the Common Stock is publicly traded and quoted regularly
in The Wall Street Journal, pursuant to a
program developed under Regulation T as promulgated by the Federal Reserve
Board that, prior to the issuance of Common Stock, results in either the
receipt of cash (or check) by the Company or the receipt of irrevocable
instructions to pay the aggregate exercise price to the Company from the sales
proceeds.

(b)           In the Company’s
sole discretion at the time your option is exercised and provided that at the
time of exercise the Common Stock is publicly traded and quoted regularly in The Wall Street Journal, by delivery to the Company (either
by actual delivery or attestation) of already-owned shares of Common Stock
either that you have held for the period required to

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avoid classification of your option as a liability for
financial accounting purposes or that you did not acquire, directly or
indirectly from the Company, that are owned free and clear of any liens,
claims, encumbrances or security interests, and that are valued at Fair Market
Value on the date of exercise.  “Delivery”
for these purposes, in the sole discretion of the Company at the time you
exercise your option, shall include delivery to the Company of your attestation
of ownership of such shares of Common Stock in a form approved by the
Company.  Notwithstanding the foregoing,
you may not exercise your option by tender to the Company of Common Stock to
the extent such tender would violate the provisions of any law, regulation or
agreement restricting the redemption of the Company’s stock.

5.             WHOLE
SHARES.  You may
exercise your option only for whole shares of Common Stock.

6.             SECURITIES
LAW COMPLIANCE. 
Notwithstanding anything to the contrary contained herein, you may not
exercise your option unless the shares of Common Stock issuable upon such
exercise are then registered under the Securities Act or, if such shares of
Common Stock are not then so registered, the Company has determined that such
exercise and issuance would be exempt from the registration requirements of the
Securities Act.  The exercise of your
option also must comply with other applicable laws and regulations governing
your option, and you may not exercise your option if the Company determines
that such exercise would not be in material compliance with such laws and
regulations.

7.             TERM.  You may not exercise your option before the
commencement or after the expiration of its term.  The term of your option commences on the Date
of Grant and expires upon the earliest of the following:

(a)           three (3) months
after the termination of your Continuous Service for any reason other than your
Disability or death; provided, however,
that (i) if during any part of such three (3) month period your option is not
exercisable solely because of the condition set forth in Section 6, your option
shall not expire until the earlier of the Expiration Date or until it shall
have been exercisable for an aggregate period of three (3) months after the
termination of your Continuous Service and (ii) if (x) you are a Non-Exempt
Employee, (y) you terminate your Continuous Service within six (6) months after
the Date of Grant specified in your Grant Notice, and (z) you have vested in a
portion of your option at the time of your termination of Continuous Service,
your option shall not expire until the earlier of (A) the later of the date
that is seven (7) months after the Date of Grant specified in your Grant Notice
or the date that is three (3) months after the termination of your Continuous
Service, or (B) the Expiration Date;

(b)           twelve (12) months
after the termination of your Continuous Service due to your Disability;

(c)           eighteen (18)
months after your death if you die either during your Continuous Service or
within three (3) months after your Continuous Service terminates;

(d)           the Expiration Date
indicated in your Grant Notice; or

(e)           the day before the
tenth (10th) anniversary of the Date of Grant.

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8.             EXERCISE.

(a)           You may exercise
the vested portion of your option during its term by delivering a Notice of
Exercise (in a form designated by the Company) together with the exercise price
to the Secretary of the Company, or to such other person as the Company may
designate, during regular business hours, together with such additional
documents as the Company may then require.

(b)           By exercising your
option you agree that, as a condition to any exercise of your option, the
Company may require you to enter into an arrangement providing for the payment
by you to the Company of any tax withholding obligation of the Company arising
by reason of (i) the exercise of your option, or (ii) the disposition of shares
of Common Stock acquired upon such exercise.

9.             TRANSFERABILITY.  Your option is not transferable, except by
will or by the laws of descent and distribution, and is exercisable during your
life only by you.  Notwithstanding the
foregoing, by delivering written notice to the Company, in a form satisfactory
to the Company, you may designate a third party who, in the event of your
death, shall thereafter be entitled to exercise your option.  In addition, you may transfer your option to
a trust if you are considered to be the sole beneficial owner (determined under
Section 671 of the Code and applicable state law) while the option is held in
the trust, provided that you and the trustee enter into transfer and other
agreements required by the Company.

10.          OPTION
NOT A SERVICE CONTRACT.  Your option is not an employment or service
contract, and nothing in your option shall be deemed to create in any way
whatsoever any obligation on your part to continue in the employ of the Company
or an Affiliate, or of the Company or an Affiliate to continue your
employment.  In addition, nothing in your
option shall obligate the Company or an Affiliate, their respective
stockholders, Boards of Directors, Officers or Employees to continue any
relationship that you might have as a Director or Consultant for the Company or
an Affiliate.

11.          WITHHOLDING OBLIGATIONS.

(a)           At the time you
exercise your option, in whole or in part, or at any time thereafter as
requested by the Company, you hereby authorize withholding from payroll and any
other amounts payable to you, and otherwise agree to make adequate provision
for (including by means of a “cashless exercise” pursuant to a program
developed under Regulation T as promulgated by the Federal Reserve Board to the
extent permitted by the Company), any sums required to satisfy the federal,
state, local and foreign tax withholding obligations of the Company or an
Affiliate, if any, which arise in connection with the exercise of your option.

(b)           Upon your request
and subject to approval by the Company, in its sole discretion, and compliance
with any applicable legal conditions or restrictions, the Company may withhold
from fully vested shares of Common Stock otherwise issuable to you upon the
exercise of your option a number of whole shares of Common Stock having a Fair
Market Value, determined by the Company as of the date of exercise, not in
excess of the minimum amount of tax required to be withheld by law (or such
lower amount as may be necessary to avoid

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classification of your option as a liability for
financial accounting purposes).  Any
adverse consequences to you arising in connection with such share withholding
procedure shall be your sole responsibility.

(c)           You may not
exercise your option unless the tax withholding obligations of the Company
and/or any Affiliate are satisfied. 
Accordingly, you may not be able to exercise your option when desired
even though your option is vested, and the Company shall have no obligation to
issue a certificate for such shares of Common Stock or release such shares of
Common Stock from any escrow provided for herein unless such obligations are satisfied.

12.          NOTICES.  Any notices provided for in your option or
the Plan shall be given in writing and shall be deemed effectively given upon
receipt or, in the case of notices delivered by mail by the Company to you,
five (5) days after deposit in the United States mail, postage prepaid,
addressed to you at the last address you provided to the Company.

13.          GOVERNING
PLAN DOCUMENT. 
Your option is subject to all the provisions of the Plan, the provisions
of which are hereby made a part of your option, and is further subject to all
interpretations, amendments, rules and regulations, which may from time to time
be promulgated and adopted pursuant to the Plan.  In the event of any conflict between the
provisions of your option and those of the Plan, the provisions of the Plan
shall control.

 4Exhibit 4.8

 

 

 

Thomas
Group, Inc. 401(k) Savings Plan

 

 

 

as amended and restated

effective

January
1, 2002

 

PREAMBLE

The purpose of this Plan
and Trust is to provide, in accordance with its provisions, a defined
contribution plan providing retirement and other related benefits for those
Employees of the Employer who are eligible to participate hereunder.

It is intended that the
Plan qualify for approval under Internal Revenue Code Section 401(a).  It is intended that the Trust be exempt from
taxation under Code Section 501(a).  It
is further intended that the Plan comply with the provisions of the Employee
Retirement Income Security Act of 1974 (ERISA).

In addition, the Plan is
amended to include certain good faith provisions intended to be construed in
accordance with the Economic Growth and Tax Relief Reconciliation Act of 2001 (“EGTRRA”)
and guidance issued thereunder.  Except
as otherwise provided, these good faith EGTRRA provisions shall be effective as
of the first day of the first Plan Year beginning after December 31, 2001.  The good faith EGTRRA provisions shall
supercede the provisions of the Plan to the extent those provisions are
inconsistent with the good faith EGTRRA provisions.

This Plan and Trust is
exclusively for the benefit of the eligible Employees and their Beneficiaries.

This document is a
complete amendment and restatement of the Thomas Group, Inc. 401(k) Savings
Plan which was originally effective January 1, 1990.  The undersigned Plan Sponsor hereby adopts
this amendment and restatement to be effective January 1, 2002, except as
otherwise specified.

The provisions of the
Plan, as amended and restated, will apply to all Plan Participants and
Beneficiaries.

 

 

 

THOMAS GROUP, INC. 401(K) SAVINGS
PLAN

 

Contents

	
  Article 1

  	
  —

  	
  DEFINITIONS

  	
  1-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 2

  	
  —

  	
  ELIGIBILITY
  TO PARTICIPATE

  	
  2-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 3

  	
  —

  	
  PARTICIPANT ACCOUNTS

  	
  3-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 4

  	
  —

  	
  ACCOUNTING AND
  VALUATION

  	
  4-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 5

  	
  —

  	
  IN-SERVICE WITHDRAWALS

  	
  5-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 6

  	
  —

  	
  PARTICIPANT LOANS

  	
  6-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 7

  	
  —

  	
  PAYMENT OF BENEFITS

  	
  7-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 8

  	
  —

  	
  MISCELLANEOUS

  	
  8-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 9

  	
  —

  	
  ADMINISTRATION

  	
  9-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 10

  	
  —

  	
  LIMITATION
  ON CONTRIBUTIONS

  	
  10-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 11

  	
  —

  	
  NONDISCRIMINATION
  PROVISIONS

  	
  11-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 12

  	
  —

  	
  TOP-HEAVY PROVISIONS

  	
  12-1

  
	
   

  	
   

  	
   

  	
   

  
	
  Article 13

  	
  —

  	
  TRUSTEE AND
  TRUST FUND

  	
  13-1

  

 

 

Article 1

DEFINITIONS

As used in this document, unless otherwise defined or
required by the context, the following terms have the meanings set forth in
this Article 1.  Some of the terms used
in this document are not defined in Article 1, but for convenience are defined
as they are introduced in the text.

1.01        Account

Account means a separate account maintained for each Participant
reflecting applicable contributions, applicable forfeitures, investment income
or loss allocated to the account, and distributions.

1.02        Accrued
Benefit

A Participant’s Accrued Benefit means the total value of his
Account(s).

A Participant’s Vested Accrued Benefit is equal to his Vested
Percentage of that portion of his Accrued Benefit that is subject to the
Vesting Schedule plus 100% of the remaining portion of his Accrued Benefit.

1.03        Beneficiary

Beneficiary means the person, persons, trust or other entity who is
designated, in accordance with Section 7.05 below, to receive any amount
payable upon the death of a Participant.

1.04        Code

Code means the Internal Revenue Code of 1986, as it may be amended from
time to time, and all regulations issued thereunder.  Reference to a section of the Code includes
that section and any comparable section or sections of any future legislation that
amends, supplements or supersedes such section and any regulations issued
thereunder.

1.05        Compensation

Except where otherwise specifically provided in this Plan, Compensation
means base or regular wages, overtime and bonuses.

Notwithstanding the foregoing, compensation includes any amounts
contributed by the Employer on behalf of any Employee pursuant to a salary
reduction agreement which are not includable in 

 1-1
 

 

the gross income of the Employee due to Code Sections 125, 402(e)(3),
402(h), 402(k), 403(b) or 457.

For Limitation Years beginning on and after January 1, 1998, for
purposes of applying the definition of Compensation with respect to the Plan
and for purposes of applying the limitations described in Articles 10 and 11 of
the Plan, Compensation paid or made available during such Limitation Years
shall include elective amounts that are not includible in the gross income of
the employee by reason of Code section 132(f)(4).

For purposes of calculating contributions to the Plan pursuant to
Article 3, the period used to determine an Employee’s Compensation for a Plan
Year will be limited to that portion of the Plan Year in which the Employee was
a Participant in the Plan.

For purposes of testing for compliance with the nondiscrimination in
contributions requirements of Code Section 401(a)(4) and the minimum coverage
requirements of Code Section 410(b), the period used to determine an Employee’s
Compensation for a Plan Year may be limited to that portion of the Plan Year in
which the Employee was a Participant in the Plan, provided that, for such
purpose, this method is applied uniformly to all Eligible Employees under the
Plan for the Plan Year.

Notwithstanding the foregoing, the period used to determine an Employee’s
Compensation is defined in Section 10.03(c) for purposes of computing Annual
Additions under Code Section 415;  in
Section 11.02(b)(3) for purposes of nondiscrimination testing under Code
Sections 401(k) and 401(m); in Section 11.01(a) for purposes of determining who
is a Highly Compensated Employee; and in Section 12.01(d) for purposes of
determining who is a Key Employee.

Notwithstanding the foregoing, Compensation for any
Shareholder-Employee includes distributions of earnings of the Employer which
are included in the taxable income of the Shareholder-Employee and result from
his personal services to the Employer.

Notwithstanding the foregoing, for all purposes under this Plan,
Compensation in excess of the Statutory Compensation Limit will be
disregarded.  Statutory Compensation
Limit means $160,000 (for Plan Years beginning after December 31, 1996), as
adjusted in subsequent years in accordance with Code Section 401(a)(17)(B).

The annual compensation of each Participant taken
into account in determining allocations for any Plan Year beginning after
December 31, 2001, shall not exceed $200,000, as adjusted for cost-of-living
increases in accordance with Code Section 401(a)(17)(B).  Annual Compensation means compensation during
the Plan Year or such other consecutive 12-month period over which compensation
is otherwise determined under the Plan (the determination period).  The cost-of-living adjustment in effect for a
calendar year applies to Annual Compensation for the determination period that
begins with or within such calendar year.

 1-2
 

 

1.06        Effective
Date

 

The original Effective Date of this Plan is January 1, 1990.  The Effective Date of this Plan as restated
is January 1, 2002, except as specified
elsewhere in this document.

1.07        Eligible
Employee Classification

An Eligible Employee Classification is a classification of Employees of
a Participating Employer, the members of which are eligible to participate in
the Plan.

The Plan covers all employee classifications except:

·                  Leased Employees, and

·                  Hourly
Employees.

Leased Employees, individuals who are classified by the Employer as
independent contractors and other workers who are classified by the Employer as
non-common law employees are not eligible to participate in the Plan whether or
not such individuals are subsequently determined by a court or administrative
agency to be Employees for purposes of the Internal Revenue Code or Title I of
ERISA.

1.08        Employee

(a)          In
General

Unless otherwise specified, an Employee is any person who is employed
by the Employer, a Related Employer or a Participating Employer.

(b)          Leased
Employee

Effective on the later of the Effective Date of the Plan or the first
day of the first Plan Year beginning after December 31, 1996, a Leased Employee
means any person who, pursuant to an agreement between the Employer or any
Related Employer (“Recipient Employer”) and any other person (“leasing
organization”), has performed services for the Recipient Employer on a
substantially full-time basis for a period of at least one year and such
services are performed under the primary direction or control of the Recipient
Employer.

Any Leased Employee will be treated as an Employee of the Recipient
Employer;  however, contributions or
benefits provided by the leasing organization which are attributable to the
services performed for the Recipient Employer will be treated as provided by
the Recipient Employer.  If all Leased
Employees constitute less than 20% of the Employer’s non-highly-compensated
work force within the meaning of Code Section 414(n)(1)(C)(ii), then the
preceding sentence will not apply to any Leased Employee if such Employee is
covered by a money purchase pension plan which provides:  (1) a nonintegrated Employer contribution
rate of at least 10% of compensation, (2) immediate participation, and (3) full
and immediate vesting (a “Safe Harbor Plan”).

 1-3
 

 

Years of Service include service by an Employee as a Leased Employee.

(c)          Shareholder-Employee

A Shareholder-Employee means a Participant who owns more than 5% of the
Employer’s outstanding capital stock during any year in which the Employer
elected to be taxed as a Small Business Corporation under Code Section
1362(a).  A Shareholder-Employee is
considered an Employee.

(d)          Owner-Employee

Owner-Employee means a Self-Employed Individual who owns more than 10%
interest in either the capital interests or the profit interest of the
Employer.  An Owner-Employee is
considered an Employee.

1.09        Employer

(a)          Employer

Unless otherwise specified, the term Employer includes the Plan
Sponsor, any Related Employer and any Participating Employer who with the written consent of the Plan Sponsor adopts
this Plan.

(b)          Participating
Employer

A Participating Employer is any organization which has adopted this
Plan and Trust,  pursuant
to the written consent of the Plan Sponsor, and in accordance with the
provisions of Section 8.10.

(c)          Predecessor
Employer

Predecessor Employer means any prior employer to which an Employer is
the successor, including any Predecessor Employer for which the Employer
maintains the obligations of a Predecessor Plan established by the Predecessor
Employer.  Service with a Predecessor
Employer will be included as Service with the Employer for all purposes under
this Plan.

In addition, any prior employer listed as a Predecessor Employer in an
Appendix to this Plan will be regarded as a Predecessor Employer for purposes
of this Plan.

(d)          Related
Employer

The term Related Employer means any other corporation, association,
company or entity on or after the Effective Date which is, along with the Plan
Sponsor, a member of a controlled group of corporations (as defined in Code
Section 414(b)), a group of trades or businesses which are under common control
(as defined in Code Section 414(c)), an affiliated service group (as defined in
Code Section 414(m)), or any organization or arrangement required to be
aggregated with the Plan Sponsor by Treasury Regulations issued under Code
Section 414(o).

 1-4
 

 

A Related Employer shall not be a Participating
Employer unless it adopts the Plan in accordance with Section 8.10.

1.10        Employment
Commencement Date

The date an Employee first is credited with an Hour of Service for the
Employer is his Employment Commencement Date.

1.11        Entry
Date

Entry Date means an Employee’s Employment
Commencement Date.

1.12        ERISA

ERISA means Public Law No. 93-406, the Employee Retirement Income
Security Act of 1974, as it may be amended from time to time, and all
regulations issued thereunder.  Reference
to a section of ERISA includes that section and any comparable section or sections
of any future legislation that amends, supplements or supersedes such section
and any regulations issued thereunder.

1.13        Fiscal
Year

Fiscal Year means the taxable year of the Plan Sponsor.  The Fiscal Year of the Plan Sponsor is the 12
month period beginning January 1 and ending December 31.

1.14        Forfeiture

Forfeiture refers to that portion, if any, of a Participant’s Accrued
Benefit which is in excess of his Vested Accrued Benefit following the
termination of the Participant’s employment.  Forfeiture also refers to Matching
Contributions that are forfeited because of Excess Aggregate Contributions.

A Forfeiture is considered to occur as of the earlier of (a) the date
of the occurrence of the fifth of 5 consecutive One Year Breaks-in-Service or
(b) the date a Cash-Out Distribution occurs in accordance with the provisions
of Section 7.06(b).

1.15        Hour
of Service

An Hour of Service means:

(a)          Each hour
for which an Employee is paid, or entitled to payment, for the performance of
duties for the Employer.  These hours
will be credited to the Employee for the computation period in which the duties
are performed;

(b)         Each hour
for which an Employee is paid, or entitled to payment, by the Employer on
account of a period of time during which no duties are performed (irrespective
of whether the 

 1-5
 

 

employment relationship has terminated) due to
vacation, holiday, illness, incapacity (including Disability as defined in
Section 7.03), layoff, jury duty, qualified military service or leave of
absence.  No more than 501 Hours of
Service will be credited under this paragraph for any 12-month period. Hours
under this paragraph will be calculated and credited pursuant to Section
2530.200b-2 of the Department of Labor Regulations which are incorporated
herein by this reference;  and

(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 will not be credited both under paragraphs (a) or (b), as the
case may be, and under this paragraph (c). 
These hours will be credited to the Employee for the computation period
or periods to which the award or agreement pertains rather than the computation
period in which the award, agreement or payment is made.

Hours of Service for all Employees will be determined on the basis of
actual hours for which an Employee is paid or is entitled to payment.  Hours of Service will be credited for
employment with any Related Employer or any Predecessor Employer.  Hours of Service will be credited for any
individual considered an employee under Code Section 414(m) or 414(n) and the
regulations thereunder.

Solely for purposes of determining whether a One Year Break-in-Service
has occurred, a Participant who is absent from work on an authorized Leave of
Absence or by reason of the Participant’s pregnancy, birth of the Participant’s
child, placement of a child with the Participant in connection with the
adoption of such child, or for the purpose of caring for such child for a
period immediately following such birth or placement, will receive credit for the
Hours of Service which otherwise would have been credited to the Participant
but for such absence.  The Hours of
Service credited under this paragraph will be credited in the Plan Year in
which the absence begins if such crediting is necessary to prevent a One Year
Break-in-Service in such Plan Year; 
otherwise, such Hours of Service will be credited in the following Plan
Year.  The Hours of Service credited
under this paragraph are those which would normally have been credited but for
such absence.  In any case in which the
Plan Administrator is unable to determine such hours normally credited, 10
Hours of Service per day will be credited. 
No more than 501 Hours of Service will be credited under this paragraph
for any 12-month period.

The Date of Severance is the second anniversary of the date on which
the absence begins.  The period between
the initial date of absence and the first anniversary of the initial date of
absence is deemed to be a period of Service. 
The period between the first and second anniversaries of the initial
date of absence is neither a period of service nor a period of severance.

1.16        Leave
of Absence

An authorized Leave of Absence means a period of time of one year or
less granted to an Employee by the Employer due to illness, injury, temporary
reduction in work force, or other appropriate cause or due to military service
during which the Employee’s reemployment rights are protected by law, provided
the Employee returns to the service of the Employer on or before the expiration
of such leave, or in the case of military service, within the time his
reemployment rights are so protected or within 60 days of his discharge from
military service if no federal law is 

 1-6
 

 

applicable.  All authorized
Leaves of Absence are granted or denied by the Employer in a uniform and
nondiscriminatory manner, treating Employees in similar circumstances in a like
manner.

If the Participant does not return to active service with the Employer
on or prior to the expiration of his authorized Leave of Absence he will be
considered to have had a Date of Severance as of the earlier of the date on
which his authorized Leave of Absence expired, the first anniversary of the
last date he worked at least one hour as an Active Participant, or the date on
which he resigned or was discharged.

1.17        Normal
Retirement Age and Normal Retirement Date

A Participant’s Normal Retirement Age is age 65.

A Participant’s Normal Retirement Date is the date on which the
Participant attains Normal Retirement Age.

1.18        One
Year Break-in-Service

One Year Break-in-Service is defined in Section 1.30.

1.19        Participant

Participant means an Employee or former Employee who is eligible to
participate in this Plan and who is or who may become eligible to receive a
benefit of any type from this Plan or whose Beneficiary may be eligible to
receive any such benefit.

(a)          Active
Participant

Active Participant means a Participant who is currently an Employee in
an Eligible Employee Classification.

(b)          Disabled
Participant

Disabled Participant means a Participant who has terminated his
employment with the Employer due to his Disability, as defined in Section 7.03,
and who is receiving or is entitled to receive benefits from the Plan.

(c)          Retired
Participant

Retired Participant means a Participant who has terminated his
employment with the Employer after meeting the requirements for his Normal
Retirement Date and who is receiving or is entitled to receive benefits from
the Plan.

(d)          Vested
Terminated Participant

Vested Terminated Participant means a Participant who has terminated
his employment with the Employer and all Related Employers, who has a
non-forfeitable right to all or a portion of 

 1-7
 

 

his or her Accrued Benefit and who has not received a distribution of
the value of his or her Vested Accrued Benefit.

(e)          Inactive
Participant

Inactive Participant means a Participant who has (i) interrupted his
status as an Active Participant without becoming a Disabled, Retired or Vested
Terminated Participant and (ii) has a non-forfeitable right to all or a portion
of his Accrued Benefit and has not received a complete distribution of his
benefit.

(f)            Former
Participant

Former Participant means a Participant who has terminated his
employment with the Employer and who currently has no non-forfeitable right to
any portion of his or her Accrued Benefit.

1.20        Payroll
Withholding Agreement

Payroll Withholding Agreement means an affirmative election by a
Participant directing the Employer to withhold, each payroll period, a whole
percentage of his Compensation (or such other amount as allowed by the Plan
Administrator) and to contribute such withheld amount to the Plan pursuant to
the provisions of Article 3.

If a Payroll Withholding Agreement is required pursuant to the
provisions of Article 3, then each Participant who elects to participate in the
Plan will enter into such agreement on or before the first day of the payroll
period for which the agreement is applicable (or at some other time as
specified by the Plan Administrator). 
Such agreement will be effective for each payroll period thereafter
until modified or amended.

Payroll Withholding Agreements will be governed by the following
general guidelines:

(a)          The Plan
Administrator will establish and apply guidelines concerning the frequency and
timing of amendments or changes to Payroll Withholding Agreements.  Notwithstanding the foregoing, a Participant
may revoke his Payroll Withholding Agreement at any time and discontinue all
future withholding.

(b)         The Plan
Administrator may amend or revoke its Payroll Withholding Agreement with any
Participant at any time if the Plan Administrator determines that such
revocation or amendment is necessary to insure that a Participant’s Annual
Additions for any Plan Year will not exceed the limitations of Article 10, or
to insure that the requirements of Code Sections 401(k) and 401(m) of the Code
have been satisfied with respect to the amount which may be withheld and
contributed on behalf of the Highly Compensated Group.

1.21        Plan,
Plan and Trust, Trust

The terms Plan, Plan and Trust and Trust mean Thomas Group, Inc. 401(k)
Savings Plan.  The Plan Identification
Number is 003.  Pursuant to Code Section
401(a)(27), the Plan is designated a profit sharing plan.

 1-8
 

 

The term Predecessor Plan means any qualified plan previously
established and maintained by an Employer and to which this Plan is the
successor.

1.22        Plan
Administrator

The Plan Administrator is the Compensation and Stock Option Committee
of the Board of Directors of Thomas Group, Inc. or the person or persons
appointed to serve as Plan Administrator pursuant to Section 9.01.

1.23        Plan
Sponsor

Thomas Group, Inc. is the Plan Sponsor.

1.24        Plan
Year

The Plan Year is the 12 month period beginning January 1 and ending
December 31.

The Limitation Year coincides with the Plan Year.

1.25        Trust
Fund, Trust

These terms mean the total cash, securities, real property, insurance
contracts and any other property held by the Trustee.

1.26        Trustee

The Trustee is the Charles Schwab Trust Company (CSTC) or any successor
Trustee, except that Lee Grubb and Alex Young or a successor trustee appointed
by the Plan Sponsor are appointed as Trustees of certain GIC contracts that are
not controlled by CSTC.

1.27        Valuation
Date

Valuation Date, unless otherwise specified, means any business day on
which the New York Stock Exchange is open.

1.28        Vested
Percentage and Vesting Schedule

A Participant’s Vested Percentage as of a given date will be that
percentage determined in accordance with the following Vesting Schedule.

 1-9
 

 

 

	
  Years of Service

  	
   

  	
  Vested Percentage

  	
   

  
	
  Less than 1
  Years

  	
   

  	
  0%

  	
   

  
	
  1 Year

  	
   

  	
  20%

  	
   

  
	
  2 Years

  	
   

  	
  40%

  	
   

  
	
  3 Years

  	
   

  	
  60%

  	
   

  
	
  4 Years

  	
   

  	
  80%

  	
   

  
	
  5 Years or More

  	
   

  	
  100%

  	
   

  

 

Notwithstanding the preceding, an Active Participant will be 100%
vested upon reaching his Normal Retirement Age.

Notwithstanding the preceding, an Active Participant will be 100%
vested in the event of his death, or upon his becoming eligible for Disability
Retirement as defined in Section 7.03.

Notwithstanding the above, the Vested Percentage of a Participant whose
accounts from a prior plan have been transferred to this Plan pursuant to
Section 8.06 will not be less than his vested percentage determined under the
provisions of the prior plan.

Notwithstanding any provision of this Plan to the contrary, Employees
of Interlink Technologies, a subsidiary of the Plan Sponsor, who became
employees of WMS Solutions, Inc. dba Interlink Technologies as a result of a
contract of sale dated August 31, 1998, shall be 100% vested in all of their
Accrued Benefits under this Plan.

1.29        Written
Resolution

The terms Written Resolution and Written Consent are used
interchangeably and reflect decisions, authorizations, etc. by the Plan
Sponsor.  A Written Resolution or Written
Consent will be evidenced by a resolution or a unanimous written consent of the
Board of Directors of the Plan Sponsor, by the written consent of an officer of
the Plan Sponsor who has been authorized to provide such consent by the Board
of Directors, or by the written consent of a committee of the Employer which
has been authorized to provide such consent by the Board of Directors.

1.30        Year
of Service

(a)          Year
of Vesting Service

Years of Service for purposes of computing a Participant’s Vested
Percentage are referred to as Years of Vesting Service and are based upon an
Employee’s Elapsed Time of employment irrespective of the number of hours
actually worked during such Elapsed Time; 
a Year of Vesting Service (including a fraction thereof) will be
credited for each completed 365 days of Elapsed Time which need not be
consecutive. All periods of employment will be aggregated including Periods of
Severance of less than 365 days.

Years of Vesting Service for purposes of determining a Participant’s
Vested Percentage include service with any organization which is a Related
Employer with respect to the 

 1-10
 

 

Employer, and service with any other organization that may be
designated in an Appendix to this Plan as an employer for which prior service
credit has been granted by the Plan Sponsor for purposes of determining a
Participant’s Vested Percentage.

Years of Vesting Service for purposes of determining the Vested
Percentage of a Participant who is reemployed after a period of Qualified
Military Service as defined in Chapter 43 of Title 38, United States Code, will
include the period of Qualified Military Service.

(b)          Determining
Service based on Elapsed Time

The following rules and terms are used in determining service based on
an Employee’s Elapsed Time of employment:

(1)           Date of
Severance (Termination) - means the earlier of (i) the actual date an Employee
resigns, is discharged, dies or retires, or (ii) the first anniversary of the
date an Employee is absent from work (with or without pay) for any other
reason, e.g., disability, vacation, leave of absence, layoff, etc.

(2)           Elapsed
Time - means the total period of service that has elapsed between an Employee’s
Employment Commencement Date and Date of Termination including Periods of
Severance where a One Year Break-in-Service does not occur.

(3)           Employment Commencement
Date - means the date an Employee first performs one Hour of Service for the
Employer.

(4)           Re-Employment Commencement Date - means the first
date, following a Period of Severance which is not required to be considered
under the Service rules, on which the Employee performs an Hour of Service for
the Employer.

(5)           One Year
Break-in-Service - means any consecutive 365-day period following an Employee’s
Date of Termination as defined above in which the Employee does not complete at
least one Hour of Service.

(6)           Period of
Severance - is the time between the actual Date of Severance as defined above
and the subsequent date, if any, on which the Employee performs an Hour of
Service.

(7)           Exception
for Leaves of Absence due to maternity or paternity reasons.  Notwithstanding the foregoing, if any
Employee is absent due to maternity or paternity reasons (pregnancy or birth of
a child of such individual or the adoption of a child by such individual or for
purposes of caring for such child immediately after birth or adoption) the Date
of Severance (Termination) will be the first anniversary of the date such
absence began and if the absence is for a period of more than 12 months, the
12-month period following the first anniversary of the date such absence began
will not be treated as a period of Service or a Period of Severance.

(8)          Exception for absence
due to Qualified Military Service – An individual who is reemployed by the
Employer after a period of Qualified Military Service as defined in Chapter 43
of Title 38, United States Code and who is entitled to reemployment rights 

 1-11
 

 

under Chapter 43,
is treated as not having one or more One Year Breaks-in-Service with the
Employer by reason of such individual’s period of Qualified Military Service.

 1-12

 

Article 2

ELIGIBILITY TO PARTICIPATE

2.01        Participation

An Employee who is a member of an Eligible Employee Classification will
become eligible to participate in the Plan on his or her Employment
Commencement Date.

An Employee who is eligible to participate as of the Effective Date or
as of a given Entry Date will automatically become a Participant as of such
date.

2.02        Participation
After Reemployment

An Employee who has satisfied all of the eligibility requirements but
terminates employment prior to his Entry Date will participate in the Plan
immediately upon returning to the employ of the Employer in an Eligible
Employee Classification (but not prior to original Entry Date).

A Participant or Former Participant who has terminated employment will
participate as an Active Participant in the Plan immediately upon returning to
the employ of the Employer in an Eligible Employee Classification.

2.03        Change
in Employment Classification

In the event a Participant becomes ineligible to participate because he
is no longer a member of an Eligible Employee Classification, the Participant
will participate immediately upon his return to an Eligible Employee
Classification.

In the event an Employee who is not a member of an Eligible Employee
Classification becomes a member of such a classification, such Employee will
begin to participate on the Entry Date coinciding with or next following the
later of the date he becomes a member of an Eligible Employee Classification or
the date he satisfies the eligibility requirements which are specified in
Section 2.01.

 2-1

 

Article 3

 

PARTICIPANT ACCOUNTS

3.01        Employee
Pre-tax Account

(a)          General

Employee Pre-tax Account means the Account of a Participant reflecting
Employee Pre-tax contributions, investment income or loss allocated thereto and
distributions.  A Participant’s Employee
Pre-tax Account is 100% vested at all times.

(b)          Employee
Pre-tax Contributions

(1)         Amount of Contribution

Each Participant may elect, pursuant to a Payroll Withholding
Agreement, to make an Employee Pre-tax Contribution not to exceed 35% of the Participant’s
Compensation without regard to the limit imposed by Code Section
401(a)(17).  Prior to
January 1, 2002, an Employee Pre-tax Contribution could not exceed
15% of the Participant’s Compensation.

Such contribution will be designated as a whole percentage of
Compensation or such other amount as allowed by the Plan Administrator.

(2)         Nondiscrimination Requirements

All Employee Pre-tax Contributions are Elective Contributions within
the meaning of Section 11.02(b)(8) and must satisfy the Nondiscrimination
Requirements of Section 11.02.

(3)         Excess Deferrals

The maximum amount of Employee Pre-tax Contributions which can be made
under the Plan on behalf of any Participant during any calendar year will be
limited to that amount which would not constitute an Excess Deferral as defined
in Section 11.02(b)(14).

The Plan Administrator will distribute any Excess Deferral, together
with the income allocable to it, to the Participant no later than April 15 of
the calendar year immediately following the year of the Excess Deferral.  If a Participant notifies the Plan
Administrator within the time prescribed by the Code and regulations
promulgated thereunder of any calendar year that Excess Deferrals have been
made on his account for the previous calendar year by reason of participation
in a Cash or Deferred Arrangement maintained by another employer or employers,
and if the Participant requests that the Plan Administrator distribute a
specific amount to him on account of Excess Deferrals and certifies that the requested
amount is an Excess Deferral, the Plan Administrator will designate the amount 

 3-1
 

 

requested together with the income allocable to it as a distribution of
Excess deferrals and distribute such amount no later than April 15 of the
calendar year immediately following the year of such Excess Deferral.

(4)         Timing of Deposits

The Employer will deposit all Employee Pre-tax
Contributions on the earliest date on which contributions can reasonably be
segregated from the Employer’s general assets.

Contributions contributed to the Plan through payroll deduction shall
be segregated from the Employer’s general assets and contributed to the trust
fund as soon as administratively feasible following the payroll period for
which the contribution was made but in no event later than the fifteenth (15th) business day of the month
following the month the deferrals were excluded from Compensation (or such
other date specified under regulations issued by the Secretary of Labor).

The Contribution Period for Employee Pre-tax Contributions is each
payroll period.

(c)          Catch-up
Contributions

Effective January 1, 2002, all Employees who are eligible to
make Employee Pre-tax Contributions under this Plan and who have attained age
50 before the close of the Plan Year shall be eligible to make Catch-Up
Contributions in accordance with, and subject to the limitations of Code
Section 414(v).  Such Catch-Up
Contributions shall not be taken into account for purposes of Code Sections
402(g) and 415.  The Plan shall not be
treated as failing to satisfy the provisions of the Plan implementing the
requirements of Code Sections 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or
416, as applicable, by reason of making of such Catch-Up Contributions.

3.02        Reserved

3.03        Employer
Matching Account

(a)          General

Employer Matching Account means the Account of a Participant reflecting
Employer Matching contributions, forfeitures, investment income or loss
allocated thereto and distributions.  A
Participant’s Employer Matching Account is subject to the Vesting Schedule.

Qualified Employer Matching Account means the Account of a Participant
reflecting Qualified Employer Matching contributions, investment income or loss
allocated thereto and distributions.  A
Participant’s Qualified Employer Matching Account is 100% vested at all times.

(b)          Employer
Matching Contributions

Effective January 1, 2002, at least each calendar quarter, the Employer
may, within the time prescribed by law for making a deductible contribution,
make a Employer Matching 

 3-2
 

 

Contribution to each eligible Participant’s Employer Matching Account
in an amount determined in accordance with this Section subject to the
limitations of Article 10.

The amount of Employer Matching Contribution to be made to an eligible
Participant’s Employer Matching Account is equal to the percentage in the
following schedule of that portion of the Participant’s Employee Pre-tax
Contribution that is not in excess of 15% of the Participant’s Compensation.

	
  Years of Benefit Service

  	
   

  	
  Matching Contribution as a

  Percentage of Employee Pre-tax

  Contribution

  	
   

  
	
  0-3

  	
   

  	
  10%

  	
   

  
	
  4-5

  	
   

  	
  25%

  	
   

  
	
  6-9

  	
   

  	
  50%

  	
   

  
	
  10 or more

  	
   

  	
  75%

  	
   

  

 

(c)          Application
of Forfeitures

Forfeitures from a Participant’s Employer Matching Account shall be
used to reduce Employer Matching Contributions in the Plan Year in which the
Forfeitures are determined to occur.

3.04        Profit
Sharing Account

(a)          General

Profit Sharing Account means the Account of a Participant reflecting
Profit Sharing contributions, forfeitures, investment income or loss allocated
thereto and distributions.  A Participant’s
Profit Sharing Account is subject to the Vesting Schedule.

(b)          Profit
Sharing Contributions

Each Plan Year, the Employer may, within the time prescribed by law for
making a deductible contribution, make an Profit Sharing Contribution to the
Trust.

For a given Plan Year, the total Profit Sharing Contribution, if any,
made by the Employer will be an amount determined and authorized by the
Employer for such Plan Year.

Such Profit Sharing Contribution will be allocated to the Profit
Sharing Accounts of all eligible Participants by the ratio which each eligible
Participant’s Compensation bears to the total Compensation of all eligible
Participants.

With respect to Profit Sharing Contributions, if an Employee enters the
Plan on an Entry Date other than the first day of a Plan Year, the Employee’s
Compensation which would otherwise 

 3-3
 

 

be considered will be limited to the Compensation actually paid to the
Employee while he is a Participant in the Plan.

For a given Plan Year, a Participant is eligible to receive an
allocation of Profit Sharing Contributions if he is employed on the last day of
the Plan Year, or terminates employment during the Plan Year due to retirement,
after attaining Normal Retirement Age (as defined in Section 1.17), Disability
(as defined in Section 7.03) or death.

(c)          Application
of Forfeitures

Forfeitures from a Participant’s Profit Sharing Account will be added
to and allocated along with Profit Sharing Contributions in the Plan Year in
which the Forfeitures are determined to occur.

3.05        Rollover
Account

(a)          General

Rollover Account means the Account of a Participant reflecting Rollover
contributions, investment income or loss allocated thereto and
distributions.  A Participant’s Rollover
Account is 100% vested at all times.

(b)          Rollover
Contribution

Rollover Contribution means a contribution to the Plan by a Participant
where such contribution is the result of a prior distribution from an Individual Retirement Account, an
Individual Retirement Annuity or another qualified plan.  Such prior contribution must be a rollover
amount described in Code Section 402(c)(4) or a contribution described in Code
Section 408(d)(3).

Effective January 1, 2002, Rollover
Contribution means a contribution to the Plan by a Participant where such
contribution is the result of a prior distribution from an eligible retirement
plan as defined in Section 5.07(c).  Such
prior contribution may not include after-tax employee contributions.

Each Employee who is a member of an Eligible Employee Classification,
regardless of whether he is a Participant in the Plan, will have the right to
make a Rollover Contribution of cash (or other property of a form acceptable to
the Plan Administrator and the Trustee) into the Plan from another qualified
plan.  If the Employee is not a
Participant hereunder, his Rollover Account will constitute his entire interest
in the Plan.

An Employee who has a balance in his Rollover Account will be eligible
to participate in any in-service withdrawal benefit pertaining to Rollover
Accounts subject to Section 5.02, and may initiate a participant loan from his
Rollover Account subject to the provisions of Article 6.  In no event will the existence of a Rollover
Account entitle the Employee to participate in any other benefit provided by
the Plan prior to the time when he becomes an Active Participant.

 3-4
 

 

3.06        Prior Plan
Account

 

(a)          General

Prior Plan Account means the Account or Accounts of a Participant
reflecting transfers from another qualified plan, investment income or loss
allocated thereto and distributions.  A
Participant’s Vested Percentage with regard to his Prior Plan Account will be
the greater of the percentage determined according to the Vesting Schedule, a
vesting schedule determined by the terms of a transferor plan, or a vesting
schedule agreed to by the Plan Sponsor with regard to the merger of a
transferor plan.

(b)          Prior
Plan Transfers

Prior Plan Transfers will mean amounts transferred, in accordance with
a Written Resolution pursuant to Section 8.06, to this Plan from another plan
which is qualified under Code Sections 401(a) and 501(a).  Such amounts will, in this Plan, remain
subject to any restrictions or limitation on distribution that the Code
subjected such amounts to under the transferor plan, and such amounts will, to
the extent required under the Code, also remain subject to payment in the form,
at the times, and on the occasions provided in the transferor plan.

If the transferor plan provided a Qualified Joint and Survivor annuity,
but is not subject to the provisions of Code Section 412, then the Qualified
Joint and Survivor Annuity shall cease to apply to the transferred accounts as
of the earlier of ninety (90) days from the date of written notice of such
elimination is provided to affected participants or the first day of the second
Plan Year following the date of transfer.

Subject to any restrictions imposed by the foregoing paragraph, an
Employee who has a balance in his Prior Plan Account will be eligible to
participate in any in-service withdrawal benefit pertaining to Prior Plan
Accounts subject to Section 5.02, and may initiate a participant loan from his
Prior Plan Account subject to the provisions of Article 6.  In no event will the existence of a Prior
Plan Account entitle the Employee to participate in any other benefit provided
by the Plan prior to the time when he becomes an Active Participant.

 3-5

 

Article 4

 

ACCOUNTING AND VALUATION

4.01        General
Powers of the Plan Administrator

The Plan Administrator will have the power to establish rules and
guidelines, which will be applied on a uniform and non-discriminatory basis, as
it deems necessary, desirable or appropriate with regard to accounting
procedures and to the timing and method of contributions to and/or withdrawals
from the Plan.

4.02        Direction
of Investment

(a)          Application
of this Section

Subject to the provisions of this Section, each Participant will have
the right to direct the investment of all of his Accounts among the Investment
Funds which are made available by the Plan Administrator.

(b)          Investment
Fund

An Investment Fund means any portion of the assets of the Trust Fund
that the Plan Administrator designates as an Investment Fund in a manner and
form acceptable to the Trustee, and for which the Plan Administrator maintains
a set of accounts separate from the remaining assets of the Trust Fund.

(c)          General
Powers of the Plan Administrator

The Plan Administrator will have the power to establish rules and
guidelines as it deems necessary, desirable or appropriate with regard to the
directed investment of contributions in accordance with this Section.  Such rules and guidelines are intended to comply
with Section 404(c) of ERISA and the regulations thereunder.  Included in such powers, but not by way of
limitation, are the following powers and rights.

(1)           To direct
the Trustee to temporarily invest those contributions which are pending
directed investment in an Investment Fund or in some other manner as determined
by the Plan Administrator.

(2)           To
establish rules with regard to the transfer of all or any part of the balance
of an Account or Accounts of a given Participant from one Investment Fund to
another.

(3)           Direct the
Trustee to maintain any part of the assets of any Investment Fund in cash, or
in demand or short-term time deposits bearing a reasonable rate of interest, or
in a short-term investment fund that provides for the collective investment of
cash balances or in other cash equivalents having ready marketability,
including, but not limited to, U.S. 

 4-1
 

 

Treasury Bills,
commercial paper, certificates of deposit, and similar types of short-term
securities.

(4)           To
temporarily suspend the ability of Participants to redirect the investment of
their Accounts during a transfer of assets between trustees or custodians,
during the replacement of funds within the Trust, or at other times deemed
necessary with respect to the administration of the Plan.

Neither the Trustee nor the Plan Administrator will be liable for any
loss that results from a Participant’s exercise of control over the investment
of the Participant’s Accounts.  If the
Participant fails to provide adequate directions, the Plan Administrator will
direct the investment of the Participant’s Account.

(d)          Accounting

The Plan Administrator will maintain a set of accounts for each
Investment Fund. The accounts of the Plan Administrator for each Investment
Fund will indicate separately the dollar amounts of all contributions made to
such Investment Fund by or on behalf of each Participant from time to
time.  The Plan Administrator will
compute the net income from investments; 
net profits or losses arising from the sale, exchange, redemption, or
other disposition of assets, and the prorata share attributable to each
Investment Fund of the expenses of the administration of the Plan and Trust and
will debit or credit, as the case may be, such income, profits or losses, and
expenses to the unsegregated balance in each Investment Fund from time to
time.  To the extent that the expenses of
the administration of the Plan and Trust are not directly attributable to a
given Investment Fund, such expenses, as of a given Valuation Date, will be
prorated among each Investment Fund; 
such allocation of expenses will, in general, be performed in accordance
with the guidelines which are specified in this Article.

(e)          Future
Contributions

Each Participant who chooses to participate in the Plan will elect the
percentage of those contributions which are subject to Participant direction of
investment which is to be deposited to each available Investment Fund.  The timing of such election will be specified
by the Plan Administrator.  Such election
will remain in effect until modified.  If
any Participant fails to make an election by the appropriate date, he will be
deemed to have elected an Investment Fund(s) as determined by the Plan
Administrator.  Elections will be limited
to whole percentages (or such other reasonable increments as determined by the
Plan Administrator).

(f)            Change
in Investment of Existing Balances

A Participant may file an election with the Plan Administrator to shift
the aggregate amount or reasonable increments (as determined by the Plan
Administrator) of the balance of his existing Account or Accounts which are
subject to Participant direction of investment among the various Investment
Funds.  Elections will be limited to
whole percentages (or such other reasonable increments as determined by the
Plan Administrator).

 4-2
 

 

(g)         Changes
in Investment Elections

Elections with respect to future contributions and/or with respect to
changes in the investment of past contributions will be in writing or through
such other means as may be approved by the Plan Administrator and in a format
specified by the Plan Administrator.

The Plan Administrator may establish additional rules and procedures
with respect to investment election changes including, for example, the number
of allowed changes per specified period, the amount of reasonable fee, if any,
which will be charged to the Participant for making a change, specified dates
or cutoff dates for making a change, etc.

(h)         Addition
and Deletion of Investment Funds

Investment Funds may be deleted or added from time to time at the
direction of the Plan Administrator.  The
Plan Administrator will establish guidelines for the proper administration of
affected Accounts when an Investment Fund is added or deleted.

(i)            Participant
Direction in Assets other than Investment Funds Authorized by the Plan
Administrator

If approved by the Plan Sponsor, a Participant may have investment
power over an account maintained for him, and may direct the investment and
reinvestment of assets of the account subject to such conditions, limitations
and other provisions as may be required by the Plan Administrator and subject
to such conditions, limitations and other provisions as may be required by the
Trustee pursuant to Section 13.02(e). To the extent provided under ERISA
Section 404(c), the Trustee and Plan Administrator will not be liable for any
loss, or by reason of any breach, which results from such Participant’s
exercise of control.

4.03        Valuation
Procedure

As of each Valuation Date, the Plan Administrator will determine from
the Trustee the fair market value of each Investment Fund and will, subject to
the provisions of this Article, determine the allocation of such value among
the Accounts of the Participants;  in
doing so, the Plan Administrator will in the following order:

(a)          Credit or
charge, as appropriate, to the proper Accounts all contributions, payments,
transfers, forfeitures, withdrawals or other distributions made to or from such
Accounts since the last preceding Valuation Date and that have not been
previously credited or charged.

(b)         Credit or
charge, as applicable, each Account with its pro rata portion of the
appreciation or depreciation in the fair market value of each Investment Fund
since the prior Valuation Date.  Such
appreciation or depreciation will reflect investment income, realized and
unrealized gains and losses, other investment transactions and expenses paid
from each Investment Fund.

 4-3

 

Article 5

IN-SERVICE WITHDRAWALS

5.01        General

An Active Participant may not withdraw funds from his Accounts except
as permitted in this Section.

5.02        Rollover
Withdrawals

Subject to procedures established by the Plan Administrator and the
provisions of Article 7, a Participant may withdraw, at any time, all or any
portion of his Accounts that are attributable to Rollover Contributions.

5.03        Reserved

5.04        Age
591⁄2 Withdrawals

Subject to procedures established by the Plan Administrator and the
provisions of Article 7, an Active Participant who has attained age 591⁄2 may
withdraw all or any portion of his vested Accounts.  A Participant who has not attained age 591⁄2
may not withdraw any portion of his Accounts prior to the time when benefits
otherwise become payable in accordance with the provisions of Article 7 except
as provided elsewhere in this Article 5.

5.05        Financial
Hardship Withdrawals

Subject to procedures established by the Plan Administrator and the
provisions of Article 7, an Active Participant may file with the Plan
Administrator a request to withdraw, in order to avoid or alleviate a Financial
Hardship, an amount necessary to satisfy the Participant’s immediate and heavy
financial need.

(a)          
Limits on the Amount of a Financial Hardship Withdrawal

A Financial Hardship Withdrawal from a Participant’s Employee Pre-tax
Account may not exceed that portion of his Employee Pre-tax Account which
represents his total Employee Pre-tax Contributions.

Financial Hardship Withdrawals are not permitted from accounts other
than the Participant’s Employee Pre-tax Account.

 5-1
 

 

(b)          Definition
of Financial Hardship

The Plan Administrator will allow Financial Hardship withdrawals only
if they are necessary to satisfy a Participant’s immediate and heavy financial
need.

(c)          
Immediate and Heavy Financial Need

A withdrawal will be deemed to be made due to an immediate and heavy
financial need of the Participant if it is made because of:

(1)           Expenses
for medical care described in Code Section 213(d) previously incurred by the
Participant, his spouse or any of his dependents (as defined in Code Section
152) or necessary for these persons to obtain medical care described in Code
Section 213(d);

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

(3)           Payment of
tuition, room and board or educational fees for the next 12 months of
post-secondary education for the Participant, his spouse, children or
dependents (as defined in Code Section 152);

(4)           Prevention
of the eviction of the Participant from his principal residence or foreclosure
on the mortgage of the Participant’s principal residence.

(d)          
Necessary To Satisfy Financial Need

No withdrawal may exceed the amount necessary to satisfy the
Participant’s immediate and heavy financial need.  However, the amount of an immediate and heavy
financial need may include any amounts necessary to pay any federal, state or
local income taxes or penalties reasonably anticipated to result from the
distribution.

A withdrawal will be treated as necessary only to the extent the
Participant certifies in writing or through such other means as may be approved
by the Plan Administrator (and the Plan Administrator does not have actual
knowledge to the contrary) that the need cannot be reasonably relieved by any
of the following:

(1)           Reimbursement
or compensation by insurance or otherwise;

(2)           Reasonable
liquidation of assets to the extent the liquidation would not itself cause an
immediate and heavy financial need;

(3)           Cessation
of Employee Pre-tax Contributions or Employee After-tax Contributions (as
defined in Section 11.02(b)) or both under any plan maintained by any employer;

(4)           Other
distributions or nontaxable (at the time of the loan) loans from plans
maintained by any employer;

(5)           Borrowing
from commercial sources on reasonable commercial terms.

 5-2
 

 

Unless the Plan Administrator has evidence to the contrary, it may rely
upon the Participant’s representation, in writing or through such other means
as may be permitted by applicable regulations, that the need cannot be relieved
by any of the foregoing.

(e)          
Safe Harbor

No withdrawal may be made until the Participant has obtained all
distributions, other than hardship distributions, and all nontaxable loans
currently available to the Participant under all plans maintained by the
Employer.

(f)            Reliance

The Employer may rely on the Employee’s written representation he is
not able to relieve the financial need through reimbursement or compensation by
insurance or otherwise, by reasonable liquidation of the employee’s assets (to
the extent such liquidation would not cause an immediate and heavy financial
need), by cessation of elective contributions or employee contributions under
the Plan, by other distributions or nontaxable loans from the plans maintained
by the Employer or by another Employer, or by borrowing from commercial sources
on reasonable commercial terms.

(g)         Moratorium
on Elective Contributions Pursuant to a Financial Hardship Withdrawal

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 employee contributions under this and all other plans of
the Employer for 6 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 employee contributions under this
and all other plans of the employer for 6 months after receipt of the distribution
or until January 1, 2002, if later.

5.06        Limitation
on Distributions from Elective Contribution Accounts

No distribution may be made from the Participant’s Employee Pre-tax
Account or any account comprised of Matching Contributions or Nonelective Contributions
which are treated as Elective Contributions in accordance with the provisions
of Section 11.02(b) except under one of the following circumstances:

(a)          the
Participant’s retirement, death, disability or severance from service within
the meaning of Code Section 401(k)(2)(B);

(b)         the
Participant’s attaining of age 591⁄2;

(c)          the
avoidance or alleviation of a Financial Hardship

(d)         the
termination of this Plan without the establishment of a successor plan within
the meaning of Treasury Regulation 1.401(k)-1(d)(3);

 5-3
 

 

(e)          the sale or
other disposition by the Employer of at least 85 percent of the assets used by
the Employer in a trade or business to an unrelated corporation which does not
maintain the plan, but only if the Participant continues employment with the
corporation acquiring the assets and only if the Employer continues to maintain
this Plan;  or

(f)            the sale
or other disposition by the Employer of its interest in a subsidiary to an
unrelated entity which does not maintain the plan, but only if the Participant
continues employment with the subsidiary and only if the Employer continues to
maintain this Plan.

Notwithstanding the
foregoing, if there is a transfer of Plan assets relating to any portion of a
Participant’s benefit under the Plan to a plan of a successor employer, then
such Participant shall be treated as not having a severance from employment
with the employer maintaining the plan that covers the Participant.  Such transfer of plan assets shall not include
a rollover or elective transfer.

This paragraph does not apply to distributions of Excess Deferrals,
Excess Contributions, or excess Annual Additions.

5.07        Benefits
Attributable to Assets Transferred from a Prior Plan

Notwithstanding any provision of this Plan to the contrary, amounts transferred
to this plan in accordance with a Written Resolution pursuant to Section 8.06
will remain subject to any withdrawal rights or restrictions that are required
to be protected under the Code and, to the extent required by law, will remain
subject to payment in the form, at the times, and on the occasions provided in
the transferor plan.

Subject to any restrictions imposed by the foregoing paragraph, the
Plan Administrator may establish a nondiscriminatory policy that will permit
In-Service Withdrawals from an Employee’s Prior Plan Account prior to the time
when he becomes an Active Participant.

 5-4

 

Article 6

PARTICIPANT LOANS

6.01        Loans
to Participants

The Plan Administrator may authorize the Trustee to lend on a
nondiscriminatory basis to a Participant an amount from the Plan as specified
herein;  provided, a reasonable rate of
interest will be charged on the loan, the loan will be secured by 50% of the
Participant’s Vested Accrued Benefit in the Plan, and provision for repayment
will be made.  All loans will be subject
to the approval of the Plan Administrator which will investigate each
application for a loan.  The Plan
Administrator will prescribe such rules as may be necessary to provide
guidelines as to under which circumstances and for what purpose loans will be
permitted.

Notwithstanding the foregoing, the Plan Administrator will not
authorize a loan to a Participant (or Beneficiary) who, at the time the loan is
to be made, is not or will not be a Party in Interest as defined in ERISA
Section 3(14), and each loan will provide for acceleration and maturity at such
time as the Participant (or Beneficiary) ceases to be a Party in Interest.

The Plan Administrator will prescribe guidelines as to which Account or
Accounts loans may be made from.  Each
loan made to a Participant will be made from the Participant’s allowable
Account or Accounts.  All interest and
principal repayments will be credited to the Participant’s Account from which
the loan was made.

6.02        Terms
and Conditions

In addition to any additional rules and regulations as the Plan
Administrator may adopt, all loans will comply with the following terms and
conditions:

(a)          Each
application for a loan by a Participant will be made to the Plan Administrator
in writing or through such other means as may be approved by the Plan
Administrator.  The Plan Administrator’s
action thereon will be final.

(b)         Each loan
will be made against collateral being the assignment of no more than 50% of the
borrower’s entire right, title and interest in and to the Trust Fund on the
date the loan is made, supported by the borrower’s promissory note for the
amount of the loan, including interest payable to the order to the Trustee, and
any additional security deemed necessary to adequately secure the Loan.  If a person fails to make a required payment
by the end of the calendar quarter following the due date set forth in the loan
agreement, the loan will be in default. 
There will be no foreclosure against a Participant’s Accrued Benefit
prior to his becoming entitled to a distribution of benefits in accordance with
the terms of this Plan.  All loans will
become due and payable in full upon the termination of a Participant’s
employment.  If a Participant with an
outstanding loan terminates employment and becomes entitled to a distribution
of benefits from the Plan, then the outstanding balance of the unpaid 

 6-1
 

 

loan plus any accrued interest thereon will be
deducted from the amount of otherwise distributable benefits and the
Participant’s promissory note will be distributed to the Participant.

(c)          The
principal repayment will be amortized over the fixed life of a loan with
installments of principal and interest to be paid not less often than
quarterly.  The period of repayment for
each loan will be arrived at by mutual agreement between the Plan Administrator
and the borrower, but in no event will such period exceed a reasonable period
of time.  The period of repayment will in
no event exceed 5 years unless the loan is to be used to acquire any dwelling
unit which, within a reasonable period of time, is to be used as a principal
residence of the Participant.

(d)         The Plan Administrator
may establish a minimum loan amount that may not be in excess of $1,000.

(e)          The maximum
amount of any loan is such that when the amount of the loan is added to the
outstanding balance of all other loans made to the Participant from the Plan
(and any other plans maintained by the Plan Sponsor or any Related Employer)
the total does not exceed the lesser of:

(1)          50%
of the Participant’s Vested Accrued Benefit; 
or

(2)          $50,000,
reduced by the amount, if any, of the highest balance of all outstanding loans
to the Participant during the one-year period ending on the day prior to the
day on which the loan in question is made.

(f)            Each loan
will bear interest at a rate equal to the prime rate which is published in the
Wall Street Journal as being representative of the base rate on corporate loans
at large U.S. money center commercial banks on the date on which the loan is
requested.

(g)         The Plan
Administrator may limit the number of loans that a Participant may have
outstanding at one time.

(h)         No loan will
be permitted to a Participant in a year in which he is either an Owner-Employee
or Shareholder-Employee as defined in Code Section 4975(d) unless the loan is
the subject of an administrative exemption granted by the U.S. Department of
Labor.

(i)             Loan repayments
will be suspended under this plan as permitted under Code Section 414(u)(4)
which pertains to employees who are absent from a position with the Plan
Sponsor or Related Employer because of Qualified Military Service as defined in
Section 8.12.

 6-2

 

Article 7

PAYMENT OF BENEFITS

7.01        Valuation
of Accounts

For purposes of this Article, the value of a Participant’s Accrued
Benefit will be determined as of the Valuation Date his Accounts are liquidated
to effect his distribution.

7.02        Normal
Retirement

In the event of a Participant’s termination of employment after he has
reached his Normal Retirement Date, he will become a Retired Participant and
his Accrued Benefit will become distributable to him.  An Active Participant’s Accrued Benefit will
become non-forfeitable no later than the date upon which he attains his Normal
Retirement Age.  The form and timing of
benefit payment will be governed by the provisions of Section 7.07.

7.03        Disability
Retirement

In the event of a Participant’s termination of employment due to
Disability, his Accrued Benefit will become non-forfeitable and he will be
entitled to begin to receive a distribution of his Accrued Benefit as of his
date of termination.  The form and timing
of benefit payment will be governed by the provisions of Section 7.07.

Notwithstanding the foregoing, if a Participant terminates employment
for any reason other than Death, Disability or attainment of Normal Retirement
Age and subsequently becomes Disabled, such Participant shall not be considered
as having satisfied the conditions for a Disability Retirement.

Disability means the determination by the Plan Administrator that a
Participant is unable by reason of any medically determinable physical or
mental impairment to perform the usual duties of his employment or of any other
employment for which he is reasonably qualified based upon his education,
training and experience.

7.04        Death
Benefit

In the event of the death of a Participant prior to the date on which
he receives a complete distribution of his benefit under the Plan, if the
Participant has a Surviving Spouse and if a Beneficiary other than the
Participant’s Surviving Spouse has not been designated pursuant to a Qualified
Election, the Participant’s Surviving Spouse will be entitled to receive the
value of the Participant’s Vested Accrued Benefit.

If a Surviving Spouse does not exist or if a Beneficiary other than the
Participant’s Surviving Spouse has been designated pursuant to a Qualified
Election (as defined in Section 7.05(c) and 

 7-1
 

 

(d) below), the Participant’s designated Beneficiary will be entitled
to receive the value of the Participant’s Vested Accrued Benefit.

If the Participant or Former Participant dies
after distribution has commenced, the Trustee shall continue to distribute the
remaining portion of the Participant’s or Former Participant’s Nonforfeitable
Account Balance at least as rapidly as under the method of distribution used
prior to the Participant’s death.

If the Participant or Former Participant dies
before distribution commences, the Trustee shall complete distribution of the
Participant’s or Former Participant’s Nonforfeitable Account Balance by
December 31 of the calendar year containing the fifth (5th) anniversary of the
Participant’s or Former Participant’s death, except to the extent that the
Designated Beneficiary elects to receive distributions under paragraphs (A) or
(B) below:

(A)      If any portion of the Participant’s or Former
Participant’s Nonforfeitable Account Balance is payable to a Designated
Beneficiary, the Designated Beneficiary may elect distributions over the life
or over a period certain not greater than the life expectancy of the Designated
Beneficiary commencing on or before December 31 of the calendar year
immediately following the calendar year in which the Participant or Former
Participant died;

(B)        If the Designated Beneficiary is the Participant’s
Surviving Spouse, the date distributions must begin under paragraph (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 or Former Participant died;  and (2) December 31 of the calendar year in
which the Participant or Former Participant would have attained age seventy and
one-half (70-1/2) years.  If the Participant
has not made an election pursuant to this Section by the time of death, the
Designated Beneficiary must elect the method of distribution no later than the
earlier of:  (1) December 31 of the
calendar year in which distributions must begin under this Section;  or (2) December 31 of the calendar year which
contains the fifth (5th) anniversary of the date of death of the Participant or
Former Participant.  If the Participant
has no Designated Beneficiary, or if the Designated Beneficiary does not elect
a method of distribution, distribution of the Nonforfeitable Account Balance of
the Participant or Former Participant must be completed by December 31 of the
calendar year containing the fifth (5th) anniversary of death.

(C)        If the Surviving Spouse is the Beneficiary of any
portion of a deceased Participant’s or Former Participant’s benefits under the
Plan, the Surviving Spouse shall be permitted to direct that this distribution
of benefits commence at a reasonable time following the death of the
Participant or Former Participant under applicable Treasury regulations.

(D)       If the Surviving Spouse dies after the Participant
or Former Participant, but before payments to the Spouse begin, the preceding
provisions of this Section, with the exception of paragraph (B), shall be
applied as if the Surviving Spouse had been the Participant.

 7-2
 

 

(b)          Post-Retirement Death
Benefit

In the event of the death of a Retired Participant or a Disabled
Participant receiving a benefit, a benefit will be paid to the Participant’s
Beneficiary or Surviving Spouse in accordance with the form of benefit payment
elected under the Plan.

7.05        Designation
of Beneficiary

(a)          General

Each Participant will be given the opportunity to designate a
Beneficiary or Beneficiaries, and from time to time the Participant may file
with the Plan Administrator a new or revised designation on the form provided
by the Plan Administrator.  If a
Participant is married, any designation of a Beneficiary other than the
Participant’s spouse must be consented to by the Participant’s spouse pursuant
to a Qualified Election.

If a Participant dies without a spouse or designated Beneficiary
surviving;  if the designated Beneficiary
(other than the spouse) does not survive until final distribution of the
Participant’s Vested Accrued Benefit;  if
a Participant who is not married dies without a designated Beneficiary;  if a Participant who is not married dies
after having made and revoked a designation but prior to having made a
subsequent designation, or if the Plan Administrator determines that a
Participant’s Beneficiary designation is not effective for any reason, then the
amount remaining of the deceased Participant’s Vested Accrued Benefit will be
payable in the following descending order to:

(i)                              first,
the Participant’s surviving descendants, including adopted persons and their
descendants;

(ii)                           then,
the Participant’s other living heirs-at-law determined under the laws
concerning intestate succession of the state in which the Participant resided
at his death;

(iii)                        then, the
Participant’s estate, personal representatives, heirs or devisees; and

(iv)                       the estate,
personal representatives, heirs or devisees of the deceased Participant’s prior
Beneficiary.

The Plan Administrator shall determine the applicable person, class of
persons, or legal entity to whom the benefit shall be paid beginning with
clause (i), in the descending order of clauses (i) to (iv).  Each class shall be determined to be not in
existence and, therefore, inapplicable by the Plan Administrator before proceeding
to the next class.  In determining if a
classification is inapplicable, the Plan Administrator shall be required only
to make reasonable inquiry into the existence of the person or persons.

Payment made pursuant to the power conferred on the Plan Administrator
in this Section shall operate as a complete discharge of all obligations under
the Plan concerning the share of a deceased Participant and shall not be
subject to review by anyone but shall be final, binding and conclusive on all
persons for all purposes.

 7-3
 

 

(b)          Surviving
Spouse

Surviving Spouse means a deceased Participant’s spouse who was married
to the Participant on the Participant’s date of death.  The Plan Administrator and the Trustee may
rely conclusively on a Participant’s statement, in writing or through such
other means as may be approved by the Plan Administrator, of his marital
status.  Neither the Plan Administrator
nor the Trustee is required at any time to inquire into the validity of any
marriage, the effectiveness of a common-law relationship or the claim of any
alleged spouse which is inconsistent with the Participant’s report of his
marital status and the identity of his spouse.

If it is established to the satisfaction of the Plan Administrator that
the spouse cannot be located, then the deceased Participant’s Vested Accrued
Benefit will be paid as if there were no surviving spouse.  If the spouse is legally incompetent, any
election or consent by the spouse may be made by the spouse’s legal
guardian.  If the deceased Participant is
legally separated or has been abandoned (within the meaning of local law) and
there is an order from a court of competent jurisdiction to this effect, then
the deceased Participant’s Vested Accrued Benefit will be paid as if there were
no surviving spouse.

(c)          Qualified
Election for Accounts not Subject to Qualified Annuity Rules

A Qualified Election for Accounts not subject to Qualified Annuity
rules means the designation of a specific Beneficiary other than the
Participant’s spouse.  Such Qualified
Election must be in writing and must be consented to by the Participant’s
spouse.  The spouse’s written consent to
a Qualified Election must be witnessed by a representative of the Plan
Administrator or a notary public.  Such
consent will not be required if the Participant establishes to the satisfaction
of the Plan Administrator that such written consent may not be obtained because
there is no spouse, the spouse cannot be located or other circumstances that
may be prescribed by Treasury Regulations. 
Any consent necessary under this provision will be valid only with
respect to the spouse who signs the consent (or in the event of a deemed
Qualified Election, the designated spouse). 
Additionally, a revocation of a prior Qualified Election may be made by
a Participant without the consent of the spouse at any time before the
commencement of benefits;  however, any
Qualified Election which follows such revocation must be in writing and must be
consented to by the Participant’s spouse. 
The number of Qualified Elections or revocations of such Qualified
Elections will not be limited.

7.06        Termination
of Employment

(a)          In
General

If a Participant’s employment terminates for any reason other than
retirement, death, or Disability (as defined in Section 7.03), his Vested Accrued
Benefit will become distributable to him as soon as administratively
feasible.  The form and timing of benefit
payment will be governed by the provisions of Section 7.07.

(b)          Cash-Out
Distribution

If a Participant terminates employment and receives a distribution
equal to the Vested Percentage of his Accounts which are subject to the Vesting
Schedule (such Accounts are 

 7-4
 

 

hereinafter referred to as Employer Contribution Accounts), a Cash-Out
Distribution will have occurred if the following conditions are met:

(1)           The
Participant was less than 100% vested in his Employer Contribution Accounts and

(2)           The
distribution was made due to the Employee’s termination of participation in the
Plan.

A distribution will be deemed to be due to the termination of an Employee’s
participation in the Plan if it is made no later than the close of the second
Plan Year following the Plan Year in which such termination occurs.

(c)          Restoration
of Employer Contribution Accounts

If, following the date of a Cash-Out Distribution, a Former Participant
returns to an Eligible Employee Classification prior to incurring 5 consecutive
One Year Breaks-in-Service, then the Participant will have the right to repay,
in cash, to the Trustee, within 5 years after his return date, the portion of
the Cash-Out Distribution which was attributable to his Employer Contribution
Accounts which were less than 100% vested in order to restore such Accounts to
their value as of the date of the Cash-Out Distribution.  The Plan Administrator will restore an
eligible Participant’s Employer Contribution Accounts as of the Valuation Date
coinciding with or immediately following the complete repayment of the Cash-Out
Distribution.

To restore the Participant’s Employer Accounts the Plan Administrator,
to the extent necessary, will, under rules and guidelines applied in a uniform
and nondiscriminatory manner, first allocate to the Participant’s Employer
Contribution Accounts the amount, if any, of Forfeitures which would otherwise
be allocated under Article 3.

To the extent such Forfeitures are insufficient to enable the Plan
Administrator to make the required restoration, the Employer will contribute
such additional amount as is necessary to enable the Plan Administrator to make
the required restoration.  The Plan Administrator
will not take into account the allocation under this Section in applying the
limitation on allocations under Article 10.

(d)          Non-Vested
Participant

If a Participant who is zero percent vested in his Employer Accounts
terminates employment, a Cash-Out Distribution will be deemed to have occurred
as of the Participant’s date of termination of employment.

If the Participant subsequently returns to an Eligible Employee
Classification prior to incurring five consecutive One Year Breaks-in-Service, then
the Participant will immediately become entitled to a complete restoration of
his Employer Contribution Accounts as of the Valuation Date coinciding with or
next following his date of re-employment. 
Such restoration will be made in accordance with the provisions of
Section 7.06(c).

(e)          Determination
of Amount of Vested Undistributed Account

If a Participant received a distribution of all or a portion of his or
her Accounts, Participant is less than 100% vested, and such distribution does
not meet the requirements of a Cash-Out 

 7-5
 

 

Distribution, prior to the Forfeiture of the non-vested portion of his
or her Account, the value of his or her undistributed Account shall be held in
a separate account and shall be determined at any time prior to and including
the date of Forfeiture under the following formula:

X = P(AB + D) - D

For this formula, the variables represent the following factors:

X is the value of the vested portion of the Participant’s Account;

P is the Participant’s Nonforfeitable percentage at the relevant time;

AB is the Account Balance at the relevant time; and

D is the amount of the distribution.

7.07        Timing
and Form of Benefit Payments

(a)          Timing
of Benefit Payment

Subject to the provisions of Section 7.08, the Plan Administrator will
direct the Trustee to make the payment of any benefit provided under this Plan
upon the event giving rise to such benefit within 60 days following the receipt
of a Participant’s request for the payment of benefits in writing or through
such other means as may be approved by the Plan Administrator and in a format
specified by the Plan Administrator.  The
Plan Administrator may temporarily suspend such processing in the event of
unusual or extraordinary circumstances such as the conversion of Plan records
from one recordkeeper to another.

(b)          Form
of Benefit Payment

The form of benefit will be a single sum payment, unless the
Participant elects to receive his benefit in the form of a direct transfer
pursuant to Section 7.09.

Notwithstanding the foregoing, if a terminated
Participant’s total Vested Accrued
Benefit is in excess of $5,000 ($3500 for distributions prior to January 1,
1998) or, in the case of distributions occurring prior to March 22, 1999, was
in excess of $5,000 ($3500 for distributions prior to January 1, 1998) at the
time of a prior distribution, (effective
January 1, 2002, as determined without regard to that portion of the
account balance that is attributable to rollover contributions and allocable
earnings), such Participant’s Vested Accrued Benefit will be payable in a
single sum payment of the entire amount of his Vested Accrued Benefit.  The Plan Administrator may, in accordance
with a policy that does not discriminate among Participants, establish periodic
times when the Plan Administrator will direct the distribution of such amounts
without the request or approval of the Participant.  For Accrued Benefits that are subject to the
Qualified Annuity rules, this paragraph will not apply after the Annuity
Starting Date.

 7-6
 

 

7.08        Commencement
of Benefit

 

(a)          General

Subject to the provisions of this Article, commencement of a benefit
will, unless the Participant elects otherwise in writing or through such other
means as may be approved by the Plan Administrator, begin not later than the
60th day after the later of the close of the Plan Year in which the Participant
attains Normal Retirement Age or the close of the Plan Year which contains the
date the Participant terminates his service with the Employer.

Payment of a Participant’s benefits must begin no later than his
Required Beginning Date.

(b)          Required
Beginning Date

Effective the later of the Effective Date of the Plan or the first day
of the first Plan Year beginning after December 31, 1996, the Required
Beginning Date for the commencement of benefit payments from the Plan is the
April 1 immediately following the later of (i) the calendar year in which the
Participant attains age 70 1⁄2, or (ii) if so elected by the Participant, the
calendar year in which the Participant retires.

Notwithstanding the foregoing, the Required Beginning Date for a
Participant who is a Five Percent Owner (as defined in Section 12.01(d)) with
respect to the Plan Year in which the Participant attains age 70 1⁄2, is the
April 1 immediately following the calendar year in which he attains age 70 1⁄2.

All distributions required under this Section will be determined and
made in accordance with the Treasury Regulations issued under Code Section
401(a)(9), including those dealing with minimum distribution requirements.  Notwithstanding the provisions of Section
7.07, an Active Participant who has reached his Required Beginning Date will
receive an annual distribution of his Accrued Benefit equal to the minimum
required distribution determined under Code Section 401(a)(9).

(c)          Life
Expectancy

For purposes of this Section, life expectancy and joint and last
survivor expectancy are to be computed by the use of the table contained in
Treasury Regulations 1.401(a)(9)-9.

7.09        Directed
Transfer of Eligible Rollover Distributions

(a)          General

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.

 7-7
 

 

(b)          Eligible
Rollover Distribution

An Eligible Rollover Distribution is 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:  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;  any distribution to the extent such
distribution is required under Code Section 401(a)(9);  the portion of any distribution that is not
includable in gross income (determined without regard to the exclusion for net
unrealized appreciation with respect to employer securities); effective for
Plan Years beginning after December 31, 1998, any hardship distribution
described in Code Section 401(k)(2)(B)(i)(IV); and effective
January 1, 2002, any amount that is distributed on account of
hardship.

Effective January 1, 2002, 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 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.

(c)          Eligible
Retirement Plan

An Eligible Retirement Plan is any of the following that accepts the
Distributee’s Eligible Rollover Distribution: 
an individual retirement account described in Code Section 408(a), an
individual retirement annuity described in Code Section 408(b), a qualified
trust described in Code Section 401(a), and effective
January 1, 2002, 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
relation order, as defined in Code Section 414(p).

(d)          Distributee

A Distributee includes an Employee or Former Employee.  In addition, the Employee’s or Former
Employee’s surviving spouse and the Employee’s or Former 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.

(e)          Direct
Rollover

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

 7-8
 

 

7.10        Waiver of
30-Day Notice

 

If a distribution is one to which Code Sections
401(a)(11) and 417 do not apply, such distribution may commence less than 30
days after the notice required under Treasury Regulation 1.411(a)-11(c) is
given, provided that:

(1)           the
Plan Administrator clearly informs the Participant that the Participant has a
right to a period of at least 30 days after receiving the notice to consider
the decision of whether or not to elect a distribution (and, if applicable, a
particular distribution option);  and

(2)           the
Participant, after receiving the notice, affirmatively elects to receive a
distribution.

 7-9

 

Article 8

MISCELLANEOUS

8.01        Exclusive
Benefit

At no time will any part of the principal or income of the Plan assets
be used or diverted for purposes other than the exclusive benefit of
Participants in the Plan and their Beneficiaries, nor may any portion of the
Plan assets revert to the Plan Sponsor or any other Employer except as provided
in Sections 10.01(e) and 8.11.

8.02        Employment
Rights of Parties Not Restricted

The adoption and maintenance of this Plan will not be deemed a contract
between the Plan Sponsor and any Employee. 
Nothing in this Plan will give any Employee or Participant the right to
be retained in the employ of the Plan Sponsor or to interfere with the right of
the Plan Sponsor to discharge any Employee or Participant at any time, nor will
it give the Plan Sponsor the right to require any Employee or Participant to
remain in its employ, or to interfere with any Employee’s or Participant’s
right to terminate his employment at any time.

8.03        Right
of Plan Sponsor to Amend or Terminate

The Plan Sponsor reserves the right to alter, amend, revoke or
terminate this Plan.  No amendment will
deprive any Participant or Beneficiary of any vested right nor will it reduce
any Accrued Benefit to which he is then entitled with respect to Employer contributions
previously made, except as may be required to maintain the Plan as a qualified
plan under the Code.  No amendment will
change the duties or responsibilities of the Trustee without its express
written consent thereto.

If this Plan is revoked or terminated (in whole or in part) or if
contributions are completely discontinued, the Accounts of all affected
Participants will become non-forfeitable. 
The Plan Sponsor will then arrange for allocation of all assets among
Participants so affected by the total or partial termination in accordance with
the requirements of all applicable law and the regulations and requirements of
the Internal Revenue Service.  All
allocated amounts will be retained in the Plan to the credit of the individual
Participants until distribution as directed by the Plan Sponsor.  Distributions to Participants may be in the
form of cash or other Plan assets or partly in each.

8.04        Amendment
to Vesting Schedule

No amendment to the Vesting Schedule will deprive a Participant of his
non-forfeitable right to his Vested Accrued Benefit as of the date of the
amendment.  Further, if the Vesting
Schedule of the Plan is amended, or if the Plan is amended in any way that
directly or indirectly affects the 

 8-1
 

 

computation of a Participant’s non-forfeitable percentage, each
Participant in the Plan as of the date of the amendment will have his Vested
Percentage computed according to the amended Vesting Schedule or according to
the Vesting Schedule prior to the amendment, whichever results in the higher
Vested Percentage.

8.05        Qualification
of Plan

The Plan Sponsor will have the sole responsibility for obtaining and
retaining qualification of the Plan under the Code with respect to the Plan
Sponsor’s individual circumstances.

Notwithstanding any of the foregoing provisions, if this Plan, upon
adoption by the Plan Sponsor, is submitted to the Internal Revenue Service
within the remedial amendment period for the tax year in which the Plan is
first effective, and the Internal Revenue Service then determines that the Plan
as initially adopted by the Plan Sponsor is not a qualified plan under the
Code, the Plan Sponsor may elect to terminate this Plan by giving notice
thereof in writing or through such other means a may be permitted by law.  Such termination will have the same effect as
if the Plan were never adopted, all policies and contracts will be canceled,
and all contributions, to the extent recoverable from the Trustee, will be
returned to their source.  If any amendment
to this Plan is submitted to the Internal Revenue Service within the period
allowed under Code Section 401(b) which then determines that the Plan as
amended is not a qualified plan under the Code, the Plan Sponsor may cancel or
modify any or all provisions of the amendment retroactive to the effective date
of the amendment in order to maintain the qualified status of the Plan,
whereupon notice thereof will be furnished to all affected Employees,
Participants and Beneficiaries in writing or through such other means as may be
permitted by law.

8.06        Mergers,
Consolidations or Transfers of Plan Assets

In the event this Plan is merged or consolidated with another plan
which is qualified under Code Sections 401(a) (and 501(a) if applicable), or in
the event of a transfer of the assets or liabilities of this Plan to another
plan which is qualified under Code Sections 401(a) (and 501(a) if applicable),
the benefit which each Participant would be entitled to receive under the
successor plan or other plan if it were terminated immediately after the merger,
consolidation or transfer will be equal to or greater than the benefit which
the Participant would have received immediately before the merger,
consolidation or transfer if this Plan had then terminated.

Any transfer of assets and/or liabilities to (or from) this Plan from
(or to) another plan qualified under Code Sections 401(a) (and 501(a) if
applicable) will be evidenced by a Written Resolution by the Plan Sponsor of
each affected plan which specifically authorizes such transfer of assets and/or
liabilities.

Any transfer of assets to this Plan will be allowed under the
provisions of this Section if such transferred assets are not required to be
paid in the form of a qualified joint & survivor annuity or a qualified
survivor annuity in accordance with Code Section 401(a)(11).

 8-2
 

 

8.07        Alienation

 

(a)          General

No person entitled to any benefit under this Plan will have any right
to sell, assign, transfer, hypothecate, encumber, commute, pledge, anticipate
or otherwise dispose of his interest in the benefit, and any attempt to do so
will be void.  No benefit under this Plan
will be subject to any legal process, levy, execution, attachment or
garnishment for the payment of any claim against such person.

(b)          Exceptions

Section 8.07(a) will not apply to the extent a Participant or
Beneficiary is indebted to the Plan under the provisions of the Plan.  At the time a distribution is to be made to
or for a Participant’s or Beneficiary’s benefit, the portion of the amount
distributed which equals the indebtedness will be withheld by the Trustee to
apply against or discharge the indebtedness. 
Before making a payment, however, the Participant or Beneficiary must be
given notice, in writing, or through such electronic means as may be permitted
by applicable regulations, that the indebtedness is to be so paid in whole or
part from his Participant’s Accrued Benefit. 
If the Participant or Beneficiary does not agree that the indebtedness
is a valid claim against his Vested Accrued Benefit, he will be entitled to a
review of the validity of the claim in accordance with procedures established
by the Plan Administrator.

Section 8.07(a) will not apply to a qualified domestic relations order
(QDRO) as defined in Code Section 414(p), and those other domestic relations
orders permitted to be so treated by the Plan Administrator under the
provisions of the Retirement Equity Act of 1984.  The Plan Administrator will establish a
written procedure to determine the qualified status of domestic relations
orders and to administer distributions under such qualified orders.  Further, to the extent provided under a QDRO,
a former spouse of a Participant will be treated as the spouse or Surviving
Spouse (as defined in Section 7.05) for all purposes under the Plan.  All rights and benefits, including elections,
provided to a Participant under this Plan will be subject to the rights
afforded to any alternate payee as such term is defined in Code Section 414(p).

This Plan specifically permits distribution to an alternate payee under
a QDRO (without regard to whether the Participant has attained his or her
earliest retirement age as that term is defined under Code Section 414(p)) in
the same manner that is provided for a Vested Terminated Participant.

In addition, Section 8.07(a) will not apply to a judgment or settlement
described in Code Section 401(a)(13)(C).

8.08        Construction

To the extent not preempted by ERISA, this Plan will be construed
according to the laws of the state in which the Plan Sponsor’s principal place
of business is located.  Words used in
the singular will include the plural, the masculine gender will include the
feminine, and vice versa, whenever appropriate.

 8-3
 

 

8.09        Named
Fiduciaries

 

(a)          Allocation
of Functions

The authority to control and manage the operation and administration of
the Plan and Trust created by this instrument will be allocated between the
Plan Sponsor and the Plan Administrator, each of whom are designated as Named
Fiduciaries with respect to the Plan and Trust as provided for by Section
402(a)(2) of ERISA.  The Plan Sponsor
reserves the right to allocate the various responsibilities for the present
execution of the functions of the Plan, other than the Trustees’
responsibilities, among its Named Fiduciaries. 
Any person or group of persons may serve in more than one fiduciary
capacity with regard to the Plan.

(b)          Responsibilities
of the Plan Sponsor

The Plan Sponsor, in its capacity as a Named Fiduciary, will have only
the following authority and responsibility:

(1)           To appoint
or remove the Plan Administrator and furnish the Trustee with certified copies
of any resolutions of the Plan Sponsor with regard thereto;

(2)           To appoint
and remove the Trustee;

(3)           To appoint
a successor Trustee or additional Trustees;

(4)           To
communicate information to the Plan Administrator and the Trustee as needed for
the proper performance of the duties of each;

(5)           To appoint
an investment manager (or to refrain from such appointment), to monitor the
performance of the investment manager so appointed, and to terminate such
appointment (more than one investment manger may be appointed and in office at
any time);  and

(6)           To
establish and communicate to the Trustee a funding policy for the Plan.

(c)          Limitation
on Obligations of Named Fiduciaries

No Named Fiduciary will have authority or responsibility to deal with
matters other than as delegated to it under this Plan or by operation of
law.  A Named Fiduciary will not in any
event be liable for breach of fiduciary responsibility or obligation by another
fiduciary (including Named Fiduciaries) if the responsibility or authority of
the act or omission deemed to be a breach was not within the scope of the Named
Fiduciary’s authority or delegated responsibility.

(d)          Standard
of Care and Skill

The duties of each fiduciary will be performed with the care, skill,
prudence and diligence under the circumstances then prevailing that a prudent
person acting in a like capacity and familiar with such matters would use in
the conduct of an enterprise of like character and with like objectives.

 8-4
 

 

8.10        Adoption and
Withdrawal by Other Organizations

 

(a)          Procedure
for Adoption

Subject to the provisions of this Section, any organization now in
existence or hereafter formed or acquired, which is not already a Participating
Employer under this Plan and which is otherwise legally eligible may, in the
future, with the consent and approval of the Plan Sponsor, by formal Written
Resolution (referred to in this Section as an Adoption Resolution), adopt the
Plan and Trust hereby created for all or any classification of persons in its
employment and thereby, from and after the specified effective date, become a
Participating Employer under this Plan. 
Such consent will be effected by and evidenced by a formal Written
Resolution of the Plan Sponsor.  The Plan
Sponsor’s consent may provide for adoption by all or specified categories of
Related Employers.  The Adoption
Resolution may contain such specific changes and variations in Plan terms and
provisions applicable to the adopting Participating Employer and its Employees
as may be acceptable to the Plan Sponsor. 
However, the sole, exclusive right of any other amendment of whatever
kind or extent to the Plan is reserved to the Plan Sponsor.  The Adoption Resolution will become, as to
the adopting organization and its Employees, a part of this Plan as then
amended or thereafter amended.  It will
not be necessary for the adopting organization to sign or execute the original
or then amended Plan and Trust Agreement or any future amendment to the Plan
and Trust Agreement.  The effective date
of the Plan for the adopting organization will be that stated in the Adoption
Resolution and from and after such effective date the adopting organization
will assume all the rights, obligations and liabilities as a Participating
Employer under this Plan.  The
administrative powers of and control by the Plan Sponsor as provided in the
Plan, including the sole right of amendment or termination of the Plan, of
appointment and removal of the Plan Administrator and the Trustee, and of
appointment and removal of an investment manager will not be diminished by
reason of the participation of the adopting organization in the Plan.

(b)          Withdrawal

Any Participating Employer may withdraw from the Plan at any time,
without affecting the Plan Sponsor or other Participating Employers not
withdrawing.  Withdrawal shall be
effected by providing a written resolution delivered to the Trustee and Plan
Sponsor specifying the effective date of such withdrawal.  A withdrawing Participating Employer may
arrange for the continuation by itself or its successor of this Plan in
separate forms for its own employees, with such amendments, if any, as it may
deem proper, and may arrange for continuation of the Plan by merger with an
existing plan and/or transfer of plan assets. The Plan Sponsor may, in its
absolute discretion, terminate a Participating Employer’s participation at any
time when in its judgment the Participating Employer fails or refuses to
discharge its obligations under the Plan.

(c)          Adoption
Contingent Upon Initial and Continued Qualifications

The adoption of this Plan by an organization as provided is hereby made
contingent and subject to the condition precedent that said adopting
organization meets, for its Employees, all the statutory requirements for
qualified plans, including, but not limited to, Code Sections 401(a) and
501(a).  If the Plan or the Trust, in its
operation, becomes disqualified, for any 

 8-5
 

 

reason, as to the adopting organization and its Employees, the portion
of the Plan assets allocable to them will be segregated as soon as is
administratively feasible, pending either the prompt (1) requalification of the
Plan as to the organization and its employees to the satisfaction of the
Internal Revenue Service so as not to affect the continued qualified status
thereof as to other Employers, (2) withdrawal of the organization from this
Plan and a continuation by itself or its successor of its plan separately from
this Plan, or by merger with another existing plan, with a transfer of its said
segregated portion of Plan assets, or (3) termination of the Plan as to itself
and its Employees.

8.11        Employer
Contributions

Employer contributions made to the Plan and Trust are made and will be
held for the sole purpose of providing benefits to Participants and their Beneficiaries.

In no event will any contribution made by the Employer to the Plan and
Trust or income therefrom revert to the Employer except as provided in Section
10.01(e) or as provided below.

(a)          Notwithstanding
any provision of this Plan to the contrary, if a contribution is made by an
Employer because of a mistake of fact, the contribution may be returned to the
Employer within one year after the payment of the contribution.  If demand is made by the Employer within one
year after payment of the contribution, the Trustee will return the amount of
the mistaken contribution which will be equal to the excess of (i) the amount
contributed over (ii) the amount that would have been contributed had there not
occurred a mistake of fact. Earnings attributable to mistaken contributions may
not be returned to the Employer, but losses attributable thereto will reduce
the amount to be returned.

(b)         Notwithstanding any
provision of this Plan to the contrary, if the Internal Revenue Service
determines that the Plan as adopted by the Employer does not qualify under
applicable sections of the Code and applicable Treasury Regulations, and the
Employer filed an application with the Internal Revenue Service for a
determination of the qualified status of the Plan by the due date of the return
for the taxable year in which the Plan was adopted, the value of all assets
will be distributed by the Trustee to the Employer within one year after the
date such initial qualification is denied. 
Thereafter, the Employer’s participation in this Plan and Trust will be
considered rescinded and of no force or effect.

 (c)       Notwithstanding any provision of this Plan to
the contrary, any contribution by the Employer to the Plan is conditioned on
the deductibility of the contribution by the Employer under the Code.  To the extent any deduction is disallowed,
the Employer, within one year following a final determination of the
disallowance, whether by agreement with the Internal Revenue Service or by
final decision in a court of competent jurisdiction, may demand repayment of
the disallowed contribution, and the Trustee will return the contribution
within one year following the disallowance. 
Earnings attributable to excess contributions may not be returned to the
Employer, but losses attributable thereto will reduce the amount to be
returned.

 8-6
 

 

8.12        Employees in
Qualified Military Service

 

Notwithstanding any provision of this Plan to the contrary,
contributions, benefits and service credits with respect to qualified military
service will be provided in accordance with Code Section 414(u).  Provisions of this plan that refer to
Qualified Military Service as defined in Code Section 414(u) are effective on
the later of the Effective Date of the Plan or December 12, 1994.

 8-7

 

Article 9

ADMINISTRATION

9.01        Plan
Administrator

The Plan Administrator will have the responsibility for the general
supervision and administration of the Plan and will be a fiduciary of the
Plan.  The Plan Sponsor may, by Written
Resolution, appoint one or more individuals to serve as Plan
Administrator.  If the Plan Sponsor does
not appoint an individual or individuals as Plan Administrator, the Plan
Sponsor will function as Plan Administrator. 
The Plan Sponsor may at any time, with or without cause, remove an
individual as Plan Administrator or substitute another individual therefor.

9.02        Powers
and Duties of the Plan Administrator

The Plan Administrator will be charged with and will have delegated to
it the full power, duty, authority and discretion to interpret and construe the
provisions of this Plan, to determine its meaning and intent and to make
application thereof to the facts of any individual case;  to determine in its discretion the rights and
benefits of Participants and the eligibility of Employees;  to give necessary instructions and directions
to the Trustee and the Insurer as herein provided or as may be requested by the
Trustee and the Insurer from time to time; 
to resolve all questions of fact relating to any of the foregoing;  and generally to direct the administration of
the Plan according to its terms.  All
decisions of the Plan Administrator in matters properly coming before it
according to the terms of this Plan, and all actions taken by the Plan
Administrator in the proper exercise of its administrative powers, duties and
responsibilities, will be final and binding upon all Employees, Participants
and Beneficiaries and upon any person having or claiming any rights or interest
in this Plan. The Plan Administrator may engage agents to assist it and may
engage legal counsel who may be counsel for the Plan Sponsor.

The Plan Sponsor and the Plan Administrator will make and receive any
reports and information, and retain any records necessary or appropriate to the
administration of this Plan or to the performance of duties hereunder or to
satisfy any requirements imposed by law. 
In the performance of its duties, the Plan Administrator will be
entitled to rely on information duly furnished by any Employee, Participant or
Beneficiary or by the Plan Sponsor or Trustee.

9.03        Actions
of the Plan Administrator

The Plan Administrator may adopt such rules as it deems necessary,
desirable or appropriate with respect to the conduct of its affairs and the
administration of the Plan.  Whenever any
action to be taken in accordance with the terms of the Plan requires the
consent or approval of the Plan Administrator, or whenever an interpretation is
to be made of the terms of the Plan, the Plan Administrator will act in a
uniform and non-discriminatory manner, treating all Employees and Participants
in similar circumstances in a like manner. 
If the Plan Administrator is a group of individuals, all of its
decisions will be made by a majority vote. 
The Plan Administrator will 

 9-1
 

 

have the authority to employ one or more persons to render advice or
services with regard to the responsibilities of the Plan Administrator,
including but not limited to attorneys, actuaries, and accountants.  The Plan Administrator will have the
authority to delegate its responsibilities under the Plan to appropriate
individuals or entities to act on behalf of the Plan Administrator.  Any persons employed to render advice or
services will have no fiduciary responsibility for any ministerial functions
performed with respect to this Plan.

9.04        Reliance
on Plan Administrator and Plan Sponsor

Until the Plan Sponsor gives notice to the contrary, the Trustee and
any persons employed to render advice or services will be entitled to rely on
the designation of Plan Administrator that has been furnished to them.  In addition, the Trustee and any persons
employed to render advice or services will be fully protected in acting upon
the written directions and instructions of the Plan Administrator made in
accordance with the terms of this Plan. 
If the Plan Administrator is a group of individuals, unless otherwise
specified, any one of such individuals will be authorized to sign documents on
behalf of the Plan Administrator and such authorized signatures will be
recognized by all persons dealing with the Plan Administrator.

The Trustee and any persons employed to render advice or services may
take cognizance of any rules established by the Plan Administrator and rely
upon them until notified to the contrary. 
The Trustee and any persons employed to render advice or services will
be fully protected in taking any action upon any paper or document believed to
be genuine and to have been properly signed and presented by the Plan
Administrator, Plan Sponsor or any agent of the Plan Administrator acting on behalf
of the Plan Administrator.

9.05        Reports
to Participants

The Plan Administrator will report in writing to a Participant his
Accrued Benefit under the Plan and the Vested Percentage of such benefit when
the Participant terminates his employment or reasonably requests such a report
in writing from the Plan Administrator. 
To the extent required by law or regulation, the Plan Administrator will
annually furnish to each Participant, and to each Beneficiary receiving benefits,
a report that fairly summarizes the Plan’s most recent report.

9.06        Bond

The Plan Administrator and other fiduciaries of the Plan will be bonded
to the extent required by ERISA or other applicable law.  No additional bond or other security for the
faithful performance of any duties under this Plan will be required.

9.07        Compensation
of Plan Administrator

The Compensation of the Plan Administrator will be left to the
discretion of the Plan Sponsor;  no
person who is receiving full pay from the Employer will receive compensation
for services as Plan Administrator.  All
reasonable and necessary expenses incurred by the Plan Administrator in
supervising and administering the Plan will be paid from the Plan assets by the
Trustee at the direction of the Plan Administrator to the extent directed by
the Plan Sponsor.

 9-2
 

 

9.08        Claims
Procedure

 

The
Named Fiduciary shall make all determinations as to the right of any Employee,
Participant, Beneficiary or other person to receive a benefit by following the
claims procedure specified in the summary plan description for the Plan and
shall act in a manner which is consistent with regulations published from time
to time by the Department of Labor. 
Effective for benefit claims filed on and after January 1, 2002,
different claims procedures shall apply to claims for Disability Retirement
Benefits and to claims for all other benefits under the Plan.

9.09        Unclaimed
Benefits

If a Participant or Beneficiary is entitled to a distribution from the
Plan, the Participant or Beneficiary will be responsible for providing the Plan
Administrator with his current address. 
If the Plan Administrator notifies the Participant or Beneficiary by
registered mail (return receipt requested) at his last known address that he is
entitled to a distribution and also notifies him of the provisions of this
paragraph, and the Participant or Beneficiary fails to claim his benefits under
the Plan or provide his current address to the Plan Administrator within one
year after such notification, the distributable amount will be forfeited and used
to reduce the cost of the Plan.  If the
Participant or Beneficiary is subsequently located, such benefit will be
restored.

9.10        Fiduciary
Responsibility

The Trustee will be solely responsible for its own acts or
omissions.  The Trustee will not have duty
to question any other fiduciary’s performance of duties allocated to such other
fiduciary pursuant to the Plan.  If the
Plan permits the appointment of additional trustees of separate Trust Funds
under the Plan, each will have no duties or responsibilities for Plan assets
held by another trustee.

Nothing contained in this Section will preclude any agreement
allocating specific responsibilities or obligations among the co-fiduciaries
provided that the agreement does not violate any of the terms and provisions of
this Plan or the requirements of applicable laws.

9.11        Expenses
of Administration

The Plan Sponsor does not and will not guarantee the Plan assets
against loss.  The Plan Sponsor may in
its sole discretion, but will not be obligated to, pay the ordinary expenses of
establishing the Plan, including the fees of administrators, recordkeepers,
consultants, accountants and attorneys in connection therewith.  The Plan Sponsor may, in its sole discretion
(but will not be obligated to), pay other costs and expenses of administering
the Plan, the taxes imposed upon the Plan, if any, and the fees, charges or
commissions with respect to the purchase and sale of Plan assets.  Unless paid by the Plan Sponsor, such costs
and expenses, taxes (if any), and fees, charges and commissions will be a
charge upon Plan assets and deducted by the Trustee.

 9-3
 

 

9.12        Distribution
Authority

If any person entitled to receive payment under this Plan is a minor,
declared incompetent or is under other legal disability, the Plan Administrator
may, in its sole discretion, direct the Trustee to:

(a)          Distribute
directly to the person entitled to the payment;

(b)         Distribute
to the legal guardian or, if none, to a parent of the person entitled to
payment or to a responsible adult with whom the person entitled to payment
maintains his residence;

(c)          Distribute
to a custodian for the person entitled to payment under the Uniform Gifts to
Minors Act if permitted by the laws of the state in which the person entitled
to payment resides;  or

(d)         Withhold
distribution of the amount payable until a court of competent jurisdiction
determines the rights of the parties thereto or appoints a guardian of the
estate of the person entitled to payment.

If there is any dispute, controversy or disagreement between any
Beneficiary or person and any other person as to who is entitled to receive the
benefits payable under this Plan, or if the Plan Administrator is uncertain as
to who is entitled to receive benefits, or if the Plan Administrator is unable
to locate the person who is entitled to benefits, the Plan Administrator may
with acquittance interplead the funds into a court of competent jurisdiction in
the judicial district in which the Plan Sponsor maintains its principal place
of business and, upon depositing the funds with the clerk of the court, be
released from any further responsibility for the payment of the benefits.  If it is necessary for the Plan Administrator
to retain legal counsel or incur any expense in determining who is entitled to
receive the benefits, whether or not it is necessary to institute court action,
the Plan Administrator will be entitled to reimbursement from the benefits for
the amount of its reasonable costs, expenses and attorneys’ fees incurred.

 9-4

 

Article
10

LIMITATION ON CONTRIBUTIONS

10.01      Limitation
on Annual Additions

The amount of the Annual Addition which may be allocated under this
Plan to any Participant’s Account as of any Allocation Date will not exceed the
Defined Contribution Limit (based upon his Compensation up to such Valuation
Date) reduced by the sum of any allocations of Annual Additions made to
Participant’s Accounts under this Plan as of any preceding Allocation Date
within the Limitation Year.

If, as a result of the allocation of forfeitures, a reasonable error in
estimating a participant’s Compensation or a reasonable error in determining
the amount of elective deferrals (within the meaning of section 402(g)(3) of
the Code), the Annual Addition under this Plan on
behalf of a Participant exceeds the Defined Contribution Limit for such
Participant, then such amount in excess of the Defined Contribution Limit shall
be reduced as of any Allocation Date. The
reduction will be, to the extent required, effected by first reducing Participant
contributions (which increase the Annual Addition), then Forfeitures (if any),
and then Employer contributions to be allocated under this Plan on behalf of
the Participant as of the Allocation Date.

Effective January 1, 2002, all employees who are eligible to
make Employee Pre-tax Contributions under this Plan and who have attained age
50 before the close of the plan year shall be eligible to make Catch-Up
Contributions in accordance with, and subject to the limitations of, Code
Section 414(v).  Such Catch-Up
Contributions shall not be taken into account for purposes of the provisions of
the Plan implementing the required limitations of Code Sections 402(g) and 415.
The Plan shall not be treated as failing to satisfy the provisions of the Plan
implementing the requirements of Code Sections 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.

Any necessary reduction will be made as follows:

(a)          The amount
of the reduction consisting of after-tax Participant contributions and income
allocable to such contributions will be paid to the Participant as soon as
administratively feasible.

(b)         The amount
of the reduction consisting of any other Participant contributions and income
allocable to such contributions will be paid to the Participant as soon as
administratively feasible.

(c)          The amount
of the reduction consisting of Forfeitures will be allocated and reallocated to
other Accounts in accordance with the Plan formula for allocating Forfeitures
to the extent that such allocations do not cause the additions to any other
Participant’s Accounts to exceed the lesser of the Defined Contribution Limit
or any other limitation provided in the Plan.

 10-1
 

 

(d)         The amount
of the reduction consisting of Employer contributions will be allocated and
reallocated to other Accounts in accordance with the Plan formula for Employer
Contributions to the extent that such allocations do not cause the additions to
any other Participant’s Accounts to exceed the lesser of the Defined
Contribution Limit or any other limitation provided in the Plan.

(e)          To the
extent that the reductions described in paragraph (d) cannot be allocated to
other Participant’s Accounts, the reductions will be allocated to a suspense
account as Forfeitures and held therein until the next succeeding Allocation
Date on which Forfeitures could be applied under the provisions of the
Plan.  All amounts held in a suspense
account must be applied as Forfeitures before any additional contributions,
which would constitute Annual Additions, may be made to the Plan.  If the Plan terminates, the suspense account
will revert to the Employer to the extent it may not be allocated to any
Participant’s Accounts.

(f)            If a
suspense account is in existence at any time during a Limitation Year pursuant
to this Section, it will not participate in the allocation of the Trust Fund’s
investment gains and losses.

10.02      Where
Employer Maintains Another Qualified Plan

(a)          Where
Employer Maintains Another Qualified Defined Contribution Plan

If the Employer maintains this Plan and one or more other qualified
defined contribution plans, one or more welfare benefit funds (as defined in
Code Section 419(e)), or one or more individual medical accounts (as defined in
Code Section 415(l)(2)), all of which are referred to in this Article 10 as “qualified
defined contribution plans,” the Annual Additions allocated under this Plan to
any Participant’s Accounts will be limited in accordance with the allocation
provisions of this Section 10.02(a).

The amount of the Annual Additions which may be allocated under this
Plan to any Participant’s Accounts as of any Allocation Date will not exceed
the Defined Contribution Limit (based upon Compensation up to the allocation
date) reduced by the sum of any allocations of Annual Additions made to the
Participant’s Accounts under this Plan and any other qualified defined
contribution plans maintained by the Employer as of any earlier Allocation Date
within the Limitation Year.

If an Allocation Date of this Plan coinciding with an Allocation Date
of any other plan described in the foregoing paragraph, the amount of Annual
Additions to be allocated on behalf of a Participant under this Plan as of such
date will be an amount equal to the product of the amount described in the next
preceding paragraph multiplied by a fraction (not to exceed 1.0), the numerator
of which is the amount to be allocated under this Plan without regard to this
Article during the Limitation Year and the denominator of which is the amount
that would otherwise be allocated on this Allocation Date under all plans
without regard to this Article 10.

If the Annual Addition under this Plan on behalf of a Participant is to
be reduced as of any Allocation Date as a result of the next preceding two
paragraphs, the reduction will be, to the 

 10-2
 

 

extent required, effected by first reducing Participant contributions
(which increase the Annual Addition) plus applicable trust earnings, then
Forfeitures (if any), and then any Employer contributions plus applicable trust
earnings, to be allocated under this Plan on behalf of the Participant as of
the Allocation Date.

If as a result of the first four paragraphs of this Section 10.02, the
allocation of additions is reduced, the reduction will be treated in the manner
described in the third paragraph of Section 10.01.

(b)          Where
Employer Maintains a Qualified Defined Benefit Plan

If the Employer maintains (or has ever maintained), in addition to this
Plan, one or more qualified defined benefit plans, then for any Limitation Year
beginning before January 1, 2000, the Annual Additions allocated under this
Plan to any Participant’s Accounts will be limited in accordance with the
provisions of Code Section 415(e), incorporating any transition rules that may
apply to a Participant’s Accounts and including any adjustments that may be
required for a Limitation Year in which the Plan is determined to be Top Heavy
and subject to the requirements of Code Section 416.

10.03      Definitions
Applicable to Article 10

(a)          Allocation
Date

Allocation Date means the date with respect to which all or a portion
of employer contributions, employee contributions and/or forfeitures are
allocated to participant accounts under a defined contribution plan.

(b)          Annual
Additions

Annual Additions are the sum of the following amounts allocated to any
defined contribution plan maintained by the Employer (including voluntary
contributions to any defined benefit plan maintained by the Employer) on behalf
of a Participant for a Limitation Year:

All Employee and Employer contributions;

All reallocated forfeitures;

Excess contributions described in Code Section 401(k) and excess
aggregate contributions described in Code Section 401(m), irrespective of
whether the Plan distributes or forfeits such Excess Amounts, and excess
deferrals described in Code Section 402(g), unless the excess deferrals are
distributed no later than the first April 15 following the close of the
Participant’s taxable year;

Excess Amounts reapplied to reduce Employer Contributions under this
Section;

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

 10-3
 

 

Contributions paid or accrued after December 31, 1985, in taxable years
ending after that 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 described in Code Section
419(e), maintained by the Employer;  and

Allocations under a simplified employee pension
plan.

Contributions or forfeitures will be treated as Annual Additions
regardless of whether they constitute Excess Deferrals, Excess Contributions or
Excess Aggregate Contributions within the meaning of the regulations under Code
Section 401(k) or 401(m) and regardless of whether they are corrected through
distribution or recharacterization. 
Excess deferrals distributed in accordance with Treasury Regulation
1.402(g)-1(e)(2) or (3) are not Annual Additions.

(c)          Compensation

Except as otherwise provided in this Article 10, Compensation for
purposes of this Article is Compensation as defined in Section 1.05.

For Plan Years beginning on or after January 1, 1998, Compensation for purposes
of this Article 10 includes any amounts contributed by the Employer or any
Related Employer on behalf of any Employee pursuant to a salary reduction
agreement which are not includable in the gross income of the Employee due to
Code Section 125, 402(e)(3), 402(h), 402(k), 403(b), 457, or other amounts
which may be included under the provisions of Code Section 415(c)(3), as
amended from time to time.

For Plan Years beginning prior to January 1, 1998, Compensation for
purposes of this Article 10 excludes any amounts contributed by the Employer or
any Related Employer on behalf of any Employee pursuant to a salary reduction
agreement which are not includable in the gross income of the Employee due to
Code Section 125, 402(e)(3), 402(h), 402(k) or 403(b).

For purposes of this Article 10, the period used to determine an
Employee’s Compensation is the Limitation Year.

(d)          Defined
Contribution Limit

The Defined Contribution Limit for a given Limitation Year is equal to
the lesser of (1) the Defined Contribution Compensation Limit, which is 25% of
Compensation applicable to the Limitation Year, or (2) the Defined Contribution
Dollar Limit.  The Defined Contribution
Dollar Limit shall be the dollar limitation under Code Section 415(c)(1)(A), as
adjusted for cost of living under Code Section 415(d).  If a short Limitation Year is created because
of an amendment changing the Limitation Year to a different 12 consecutive
month period, the Defined Contribution Dollar Limit is multiplied by a
fraction, the numerator of which is equal to the number of months in the short
Limitation Year and the denominator of which is 12.

Effective for Limitation Years beginning after December 31, 2001,
Defined Contribution Limit for a given Limitation Year is equal to the lesser
of (1) $40,000 as adjusted for 

 10-4
 

 

increases in the cost-of-living under Code Section 415(d), or (2) 100%
of the Participant’s Compensation for the Limitation Year.

(e)          Employer

The Employer is the Employer that adopts this Plan together with all
Related Employers.  For this purpose, the
definition of Related Employer in Section 1.09 of this Plan is modified by Code
Section 415(h).

(f)            Limitation
Year

The Limitation Year will be the 12 consecutive month period which is
specified in Article 1 of this Plan and which is adopted for all qualified
plans maintained by the Plan Sponsor pursuant to a Written Resolution adopted
by the Plan Sponsor.  In the event of a
change in the Limitation Year, the additional limitations of Treasury
Regulation 1.415-2(b)(4)(iii) will also apply.

 10-5

 

Article
11

NONDISCRIMINATION

11.01

Highly Compensated Definitions

(a)          Calendar
Year Data Election

The Calendar Year Data Election means the Employer has elected to
determine who is Highly Compensated based on Compensation received (or for
federal tax purposes, deemed to be received) in the Calendar Year that ends
within the Plan Year for which the determination is being made. This election
is permitted for Plans with fiscal Plan Years beginning after December 31,
1997. For 1997 Determination Years, Plans with calendar Plan Years were also
permitted to make this election.

(b)          Compensation

Except as otherwise provided in this paragraph, Compensation for
purposes of this Section 11.01 is Compensation as defined in Section 1.05.

For purposes of determining whether an Employee is a Highly Compensated
Employee, the period used to determine an Employee’s Compensation is the Plan
Year.

(c)          Determination
Year

Determination Year means the Plan Year for which the determination of
who is Highly Compensated is being made.

(d)          Highly
Compensated Employee

Highly Compensated Employee means any individual who is a Highly
Compensated Active Employee or a Highly Compensated Former Employee within the
meaning of Code Section 414(q) and the regulations thereunder.

(e)          Highly
Compensated Active Employee

Highly Compensated Active Employee means any individual who:

·                  During
the Determination Year or the Lookback Year was at any time a 5-percent Owner
(within the meaning of Code Section 416(i)) of the Employer or any Related
Employer;

·                  During
the Lookback Year

 11-1
 

 

·                  (i)
received Compensation from the Employer and all Related Employers in excess of
$80,000 (or any greater amount determined by regulations issued by the
Secretary of the Treasury under Code Section 415(d));  and

·                  (ii),
was in the Top-paid Group for such Lookback Year.

(f)            Highly
Compensated Former Employee

Highly Compensated Former Employee means any Former Employee who had a
Separation Year (within the meaning of Treasury Regulation 1.414(q)-1T
Q&A-5) and was a Highly Compensated Active Employee for either the
Separation Year or any Determination Year ending on or after the Employee’s
55th birthday.

(g)         Highly
Compensated Group

Highly Compensated Group means all Highly Compensated Employees.

(h)         Lookback
Year

Lookback Year means the 12-month period immediately preceding the
Determination Year.

(i)            Non-Highly
Compensated Employee

Non-Highly Compensated Employee means an Employee who is not a Highly
Compensated Employee.

(j)            
Non-Highly Compensated Group

Non-Highly Compensated Group means all Non-Highly Compensated
Employees.

(k)        Top-Paid
Group

Top-Paid Group means those individuals who are among the top 20 percent
of Employees of the Employer and all Related Employers when ranked on the basis
of Compensation received during the year. 
In determining the number of individuals in the Top-Paid Group (but not
the identity of those individuals), the following individuals may be excluded:

Employees who have not completed 6 months of Service by the end of the
year.  For this purpose, an Employee who
has completed One Hour of Service in any calendar month will be credited with
one month of Service;

Employees who normally work fewer than 171⁄2 hours per week;

Employees who normally work fewer than 6 months during any year.  For this purpose, an Employee who has worked
on one day of a month is treated as having worked for the whole month;

Employees who have not reached age 21 by the end of the year;

 11-2
 

 

Nonresident aliens who received no earned income (which constitutes
income from sources within the United States) within the year from the Employer
or any Related Employer;  and

Employees covered by a collective bargaining agreement negotiated in
good faith between the employee representatives and the Employer or a group of
employers of which the Employer is a member if (i) 90% or more of all employees
of the Employer and all Related Employers are covered by collective bargaining
agreements, and (ii) this Plan covers only Employees who are not covered under
a collective bargaining agreement.

11.02      Nondiscrimination
Requirements under Code Sections 401(k) and 401(m)

(a)          Effective
Date

The provisions of this Article are effective on the later of the
Effective Date of the Plan or the first day of the first Plan Year beginning
after December 31, 1996.

(b)          Definitions
Relating to Code Sections 401(k) and 401(m)

The following definitions apply to this Section:

(1)         Aggregate Limit

With respect to a given Plan Year, Aggregate Limit means the greater of
the sum of [A + B] or the sum of [C + D] where:

A is equal to 125% of the greater of DP or CP;

B is equal to 2 percentage points plus the lesser of
DP or CP, not to exceed 2 times the lesser of DP or CP;

C is equal to 125% of the lesser of DP or CP;

D is equal to 2 percentage points plus the greater of
DP or CP, not to exceed 2 times the greater of DP or CP;

DP represents the Deferral Percentage for the
Non-highly Compensated Group eligible under the Cash or Deferred Arrangement
for the Plan Year;  and

CP represents the Contribution Percentage for the
Non-highly Compensated Group eligible under the plan providing for the Employee
After-tax Contributions or Employer Matching Contributions for the Plan Year
beginning with or within the Plan Year of the Cash or Deferred Arrangement.

(2)         Cash or Deferred Arrangement (CODA)

A Cash or Deferred Election is any election (or modification of an
earlier election) by an Employee to have the Employer either:

 11-3
 

 

(A)      provide an
amount to the Employee in the form of cash or some other taxable benefit that
is not currently available, or

(B)        contribute an
amount to the Plan (or provide an accrual or other benefit) thereby deferring
receipt of Compensation.

A Cash or Deferred Election will only be made with respect to an amount
that is not currently available to the Employee on the date of election.  Further, a Cash or Deferred Election will
only be made with respect to amounts that would have (but for the Cash or
Deferred Election) become currently available after the later of the date on
which the Employer adopts the Cash or Deferred Arrangement or the date on which
the arrangement first becomes effective.

A Cash or Deferred Election does not include a one-time irrevocable
election upon the Employee’s commencement of employment or first becoming an
Eligible Employee.

(3)         Compensation

Except as otherwise provided in this paragraph, Compensation for
purposes of this Section 11.02 is Compensation as defined in Section 1.05.

For purposes of this Section 11.02, the period used to determine an
Employee’s Compensation for a Plan Year may, at the election of the Employer,
be limited to that portion of the Plan Year in which the Employee was an
Eligible Employee.

(4)         Contribution Percentage

Contribution Percentage means, for any specified group, the average of
the ratios calculated (to the nearest one-hundredth of one percent) separately
for each Participant in the group, of the amount of Employee After-tax
Contributions and Matching Contributions which are made by or on behalf of each
Participant for a Plan Year to each Participant’s Compensation for the Plan
Year.

For purposes of determining the Contribution Percentage, each Employee
who is eligible under the terms of the Plan to make or to have contributions
made on his behalf is treated as a Participant. 
The Contribution Percentage of an eligible Employee who makes no
Employee After-tax Contribution and receives no Matching Contribution is zero.

The Contribution Percentage of a Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to make Employee
After-tax Contributions or receive an allocation of Matching Contributions
(including Elective Contributions and Nonelective Contributions which are
treated as Employee or Matching Contributions for purposes of the Contribution
Percentage Test) allocated to his accounts under two or more plans which are
sponsored by the Employer will be determined as if the Employee After-tax and
Matching Contributions were made under a single plan.  For purposes of this paragraph, if a Highly
Compensated Employee participates in two or more such plans which have
different Plan Years, all plans ending with or within the same calendar year
will be treated as a single plan.

 11-4
 

 

Anything to the contrary notwithstanding, in calculating the average
Non-highly Compensated Employee average Contribution Percentage for the 1997
Plan Year, the plan must use the Highly Compensated Employee definition
applicable to the preceding Plan Year.

(5)         Contribution Percentage Test

The Contribution Percentage Test is a test applied on a Plan Year basis
to determine whether a plan meets the requirements of Code Section 401(m). For
1997 and 1998 plan years, a plan may perform the Contribution Percentage Test
using either current year data or prior year data without Internal Revenue
Service approval. The Appendix attached hereto and made a part of this Plan
describes the testing elections made by the Employer for the 1997 and 1998 Plan
Years.

In each of the following tests, the Contribution Percentage for the
Highly Compensated Group for a Plan Year is compared with the Contribution
Percentage for the Non-highly Compensated Group for the Current Year.  The Contribution Percentage Test may be met
by either satisfying the General Contribution Percentage Test or the
Alternative Contribution Percentage Test.

Effective for Plan Years beginning after December 31, 1998, the General
Contribution Percentage Test is satisfied if the Contribution Percentage for
the Highly Compensated Group does not exceed 125% of the Contribution
Percentage for the Non-highly Compensated Group, determined for the Plan Year
for which the General Contribution Percentage Test is conducted.

The Alternative Contribution Percentage Test is satisfied if the
Contribution Percentage for the Highly Compensated Group does not exceed the
lesser of:

(A)      the Contribution
Percentage for the Non-highly Compensated Group plus 2 percentage points, or

(B)        the
Contribution Percentage for the Non-highly Compensated Group multiplied by 2.0.

The Contribution Percentage for the Non-highly Compensated Group shall
be determined based on the average Contribution Percentage of the Non-highly
Compensated Group for the Plan Year for which the Alternative Contribution
Percentage Test is conducted.

If (i) one or more Highly Compensated Employees of the Employer or any
Related Employer are eligible to participate in both a Cash or Deferred
Arrangement and a plan which provides for Employee After-tax Contributions or
Matching Contributions, (ii) the Contribution Percentage for the Highly
Compensated Group does not satisfy the General Contribution Percentage Test,
and (iii) the Contribution Percentage for the Highly Compensated Group does not
satisfy the General Contribution Percentage Test, then the Contribution
Percentage Test will be deemed to be satisfied only if the sum of the Contribution
Percentage and the Contribution Percentage for the Highly Compensated Group
does not exceed the Aggregate Limit; 
provided, however that the General 

 11-5
 

 

Contribution Percentage Test and the General Contribution; provided,
however, that the applicable Contribution Percentage Test and the applicable
Contribution Percentage Test are independently satisfied.

The Plan will not fail to satisfy the Contribution Percentage test
merely because all of the Eligible Employees under the Plan for a Plan Year are
Highly Compensated Employees.

If (i) one or more Highly Compensated Employees of the Employer or any
Related Employer are eligible to participate in both a Cash or Deferred
Arrangement and a plan which provides for Employee After-tax Contributions or
Matching Contributions, (ii) the Contribution Percentage for the Highly
Compensated Group does not satisfy the General Contribution Percentage Test,
and (iii) the Contribution Percentage for the Highly Compensated Group does not
satisfy the General Contribution Percentage Test, then the Contribution
Percentage Test will be deemed to be satisfied only if the sum of the
Contribution Percentage and the Contribution Percentage for the Highly
Compensated Group does not exceed the Aggregate Limit;  provided, however, that the applicable
Contribution Percentage Test and the applicable Contribution Percentage Test
are independently satisfied.

The Plan will not fail to satisfy the Contribution Percentage test
merely because all of the Eligible Employees under the Plan for a Plan Year are
Highly Compensated Employees.

(6)         Deferral Percentage

Deferral Percentage means, for any specified group, the average of the
ratios calculated (to the nearest one-hundredth of one percent) separately for
each Participant in the group, of the amount of Elective Contributions which
are made on behalf of each Participant for a Plan Year to each Participant’s
Compensation for the Plan Year.

For purposes of determining the Deferral Percentage, each Employee who
is eligible under the terms of the Plan to have contributions made on his
behalf is treated as a Participant.  The
Deferral Percentage of an eligible Employee who makes no Elective Contribution
is zero.

The Deferral Percentage of a Participant who is a Highly Compensated
Employee for the Plan Year and who is eligible to have Elective Contributions
(including Nonelective Contributions or Matching Contributions which are
treated as Elective Contributions for purposes of the Deferral Percentage Test)
allocated to his accounts under two or more Cash or Deferred Arrangements which
are maintained by the Employer will be determined as if the Elective
Contributions were made under a single Arrangement.  For purposes of this paragraph, if a Highly
Compensated Employee participates in two or more Cash or Deferred Arrangements
which have different Plan Years, all Cash or Deferred Arrangements ending with
or within the same calendar year will be treated as a single Arrangement.

Anything to the contrary notwithstanding, in calculating the average
Non-highly Compensated Employee average Deferral Percentage for the 1997 Plan
Year, the plan 

 11-6
 

 

must use the Highly Compensated Employee definition applicable to the
preceding Plan Year.

(7)         Deferral Percentage Test

The Deferral Percentage Test is a test applied on a Plan Year basis to
determine whether a plan meets the requirements of Code Section 401(k). For
1997 and 1998 plan years, a plan may perform the Deferral Percentage Test using
either current year data or prior year data without Internal Revenue Service approval.
The Appendix attached hereto and made a part of this Plan describes the testing
elections made by the Employer for the 1997 and 1998 Plan Years.

In each of the following tests, the Deferral Percentage for the Highly
Compensated Group for a Plan Year is compared with the Deferral Percentage for
the Non-highly Compensated Group. for the current Plan Year (or the preceding
Plan Year if elected by the Employer in an Appendix to this Plan;  provided, however, that if such an election
is made, it will be made in accordance with regulations issued by the Secretary
of the Treasury).  The Deferral
Percentage Test may be met by either satisfying the General Deferral Percentage
Test or the Alternative Deferral Percentage Test.

In the case of the first Plan Year of the Plan (if this is not a
successor plan within the meaning of Treasury Regulation 1.401(k)-1(d)(3)), the
Deferral Percentage for the Non-highly Compensated Group may be either (i) the
actual Deferral Percentage for the Non-highly Compensated Group for the first
Plan Year or, if the Employer elects, 3% as the Deferral Percentage for the
Non-highly Compensated Group for the preceding year.

Effective for Plan Years beginning after December 31, 1998, the General
Deferral Percentage Test is satisfied if the Deferral Percentage for the Highly
Compensated Group does not exceed 125% of the Deferral Percentage for the
Non-highly Compensated Group, determined for the Plan Year for which the
General Deferral Percentage Test is conducted.

The Alternative Deferral Percentage Test is satisfied if the Deferral
Percentage for the Highly Compensated Group does not exceed the lesser of:

(A)      the Deferral
Percentage for the Non-highly Compensated Group plus 2 percentage points, or

(B)        the Deferral
Percentage for the Non-highly Compensated Group multiplied by 2.0.

The Deferral Percentage for the Non-highly Compensated Group shall be
determined based on the average Deferral Percentage of the Non-highly
Compensated Group for the Plan Year for which the Alternative Deferral Percentage
Test is conducted.

If (i) one or more Highly Compensated Employees of the Employer or any
Related Employer are eligible to participate in both a Cash or Deferred
Arrangement and a plan which provides for Employee After-tax Contributions or
Matching Contributions, (ii) the Deferral Percentage for the Highly Compensated
Group does not satisfy the General 

 11-7
 

 

Deferral Percentage Test, and (iii) the Contribution Percentage for the
Highly Compensated Group does not satisfy the General Contribution Percentage
Test, then the Deferral Percentage Test will be deemed to be satisfied only if
the sum of the Deferral Percentage and the Contribution Percentage for the
Highly Compensated Group does not exceed the Aggregate Limit; provided,
however, that the applicable Deferral Percentage Test and the applicable
Contribution Percentage Test are independently satisfied.

The Plan will not fail to satisfy the Deferral Percentage test merely
because all of the Eligible Employees under the Plan for a Plan Year are Highly
Compensated Employees.

(8)         Elective Contribution

Elective Contribution means any contribution made by the Employer to a
Cash or Deferred Arrangement on behalf of and at the election of an Employee.
An Elective Contribution will be taken into account for a given Plan Year only
if:

(A)      The Elective
Contribution is allocated to the Participant’s Account as of a date within the
Plan Year to which it relates;

(B)        The
allocation is not contingent upon the Employee’s participation in the Plan or
performance of services on any date after the allocation date;

(C)        The Elective
Contribution is actually paid to the trust no later than 12 months after the
end of the Plan Year to which the Elective Contribution relates;  and

(D)       The Elective
Contribution relates to Compensation which either (i) but for the Participant’s
election to defer, would have been received by the Participant in the Plan Year
or (ii) is attributable to services performed by the Participant in the Plan
Year and, but for the Participant’s election to defer, would have been received
by the Participant within two and one-half months after the close of the Plan
Year.

Elective Contributions will be treated as Employer Contributions for
purposes of Code Sections 401(a), 401(k), 402(a), 404, 409, 411, 412, 415, 416,
and 417.

(9)         Elective Deferral

Elective Deferral means the sum of the following:

(A)      Any Elective
Contribution to any Cash or Deferred Arrangement to the extent it is not
includable in the Participant’s gross income for the taxable year of
contribution;

(B)        Any employer
contribution to a simplified employee pension as defined in Code Section 408(k)
to the extent not includable in the Participant’s gross income for the taxable
year of contribution;

(C)        Any employer
contribution to an annuity contract under Code Section 403(b) under a salary
reduction agreement to the extent not includable in the Participant’s gross
income for the taxable year of contribution; 
plus

 11-8
 

 

(D)       Any employee
contribution designated as deductible under a trust described in Code Section
501(c)(18) for the taxable year of contribution.

(10) Eligible
Employee

Eligible Employee means an Employee who is directly or indirectly
eligible to make a Cash or Deferred Election under the Plan for all or a
portion of the Plan Year.  An Employee who
is unable to make a Cash or Deferred Election because the Employee has not
contributed to another plan is also an Eligible Employee.  An Employee who would be eligible to make
Elective Contributions but for a suspension due to a distribution, a loan, or
an election not to participate in the Plan, is treated as an Eligible Employee
for purposes of Code Section 401(k)(3) and 401(m) for a Plan Year even though
the Employee may not make a Cash or Deferred Election due to the suspension.  Also, an Employee will not fail to be treated
as an Eligible Employee merely because the employee may receive no additional
Annual Additions because of Code Section 415(c)(1) or 415(e).

(11) Employee
After-tax Contribution

Employee After-tax Contribution means any contribution made by an
Employee to any plan maintained by the Employer or any Related Employer which
is other than an Elective Contribution and which is designated or treated at
the time of contribution as an after-tax contribution.  Employee After-tax Contributions include
amounts attributable to Excess Contributions which are recharacterized as
Employee After-tax Contributions.

(12) Excess
Contribution

Excess Contribution means, for each member of the Highly Compensated
Group, the amount of Elective Contribution (including any Qualified Nonelective
Contributions and Qualified Matching Contributions which are treated as
Elective Contributions) which exceeds the maximum contribution which could be
made if the Deferral Percentage Test were to be satisfied.

(13) Excess Aggregate
Contribution

Excess Aggregate Contribution means, for each member of the Highly
Compensated Group, the amount of Employee After-tax and Matching Contributions
(including any Qualified Nonelective Contributions and Elective Contributions
which are treated as Matching Contributions) which exceeds the maximum
contribution which could be made if the Contribution Percentage Test were to be
satisfied.

(14) Excess
Deferral

Excess Deferral means, for a given calendar year, that amount by which
each Participant’s total Elective Deferrals under all plans of all employers
exceed the dollar limit in effect under Code Section 402(g) for the calendar
year.

 11-9
 

 

(15) Matching
Contribution

Matching Contribution means any contribution made by the Employer to
any plan maintained by the Employer or any Related Employer which is based on
an Elective Contribution or an Employee After-tax Contribution together with
any forfeiture allocated to the Participant’s Account on the basis of Elective
Contributions, Employee After-tax Contributions or Matching Contributions.  A Matching Contribution will be taken into
account for a given Plan Year only if:

(A)      The Matching
Contribution is allocated to a Participant’s Account as of a date within the
Plan Year to which it relates;

(B)        The
allocation is not contingent upon the Employee’s participation in the Plan or
performance of services on any date after the allocation date;

(C)        The Matching
Contribution is actually paid to the Trust no later than 12 months after the
end of the Plan Year to which the Matching Contribution relates;  and

(D)       The Matching
Contribution is based on an Elective or Employee After-tax Contribution for the
Plan Year.

Any contribution or allocation, other than a Qualified Nonelective
Contribution, which is used to meet the minimum contribution or benefit
requirement of Code Section 416 is not treated as being based on Elective
Contributions or Employee After-tax Contributions and therefore is not treated
as a Matching Contribution.

Qualified Matching Contribution is defined in Section 11.02(b)(17)
below.

(16) Nonelective
Contribution

Nonelective Contribution means any Employer contribution, other than a
Matching Contribution, which meets all of the following requirements:

(A)      The Nonelective
Contribution is allocated to a Participant’s Account as of a date within the
Plan Year to which it relates;

(B)        The
allocation is not contingent upon the Employee’s participation in the Plan or
performance of services on any date after the allocation date;

(C)        The
Nonelective Contribution is actually paid to the Trust no later than 12 months
after the end of the Plan Year to which the Nonelective Contribution
relates;  and

(D)       The Employee
may not elect to have the Nonelective Contribution paid in cash in lieu of
being contributed to the Plan.

Qualified Nonelective Contribution is defined in Section 11.02(b)(18)
below.

 11-10

 

(17) Qualified
Matching Contribution

Qualified Matching Contribution means a Matching Contribution which is
100% vested and may be withdrawn or distributed only under the conditions
described in Treasury Regulation 1.401(k)-1(d).

(18) Qualified
Nonelective Contribution

Qualified Nonelective Contribution means a Nonelective Contribution
which is 100% vested and may be withdrawn or distributed only under the
conditions described in Treasury Regulation 1.401(k)-1(d).

(c)          Application
of Deferral Percentage Test

All Elective Contributions, including any Elective Contributions which
are treated as Employee After-tax or Matching Contributions with respect to the
Contribution Percentage Test, must satisfy the Deferral Percentage Test.  Furthermore, any Elective Contributions which
are not treated as Employee After-tax or Matching Contributions with respect to
the Contribution Percentage Test must satisfy the Deferral Percentage
Test.  The Plan Administrator will
determine as soon as administratively feasible after the end of the Plan Year
whether the Deferral Percentage Test has been satisfied.  If the Deferral Percentage Test is not
satisfied, the Employer may elect to make an additional contribution to the
Plan on account of the Non-highly Compensated Group.  The additional contribution will be treated
as a Nonelective Contribution.

If the Deferral Percentage Test is not satisfied after any Nonelective
Contributions, the Plan Administrator may, in its sole discretion,
recharacterize all or any portion of the Excess Contribution of each Highly
Compensated Employee as an Employee After-tax Contribution if Employee
After-tax Contributions are otherwise allowed by the Plan.  If so, the Plan Administrator will notify all
affected Participants and the Internal Revenue Service of the amount
recharacterized no later than the 15th day of the third month following the end
of the Plan Year in which the Excess Contribution was made.  Excess Contributions will be includable in
the Participant’s gross income on the earliest date any Elective Contribution
made on behalf of the Participant during the Plan Year would have been received
by the Participant had the Participant elected to receive the amount in
cash.  Recharacterized Excess Contributions
will continue to be treated as Employer contributions that are Elective
Contributions for all other purposes under the Code, including Code Sections
401(a) (other than 401(a)(4) and 401(m)), 404, 409, 411, 412, 415, 416, 417 and
401(k)(2).  With respect to the Plan Year
for which the Excess Contribution was made, the Plan Administrator will treat
the recharacterized amount as an Employee After-tax Contribution for purposes
of the Deferral Percentage Test and the Contribution Percentage Test and for
purposes of determining whether the Plan meets the requirements of Code Section
401(a)(4), but not for any other purposes under this Plan.  Therefore, recharacterized amounts will
remain subject to the nonforfeiture requirements and distribution limitations
which apply to Elective Contributions.

If the Deferral Percentage Test is still not satisfied, then after the
close of the Plan Year in which the Excess Contribution arose but within 12
months after the close of that Plan Year, 

 11-11
 

 

the Plan Administrator will distribute the Excess Contributions, together
with allocable income, to Participants of the Highly Compensated Group to the
extent necessary to satisfy the Deferral Percentage Test.  Failure to do so will cause the Plan to not
satisfy the requirements of Code Section 401(a)(4) for the Plan Year for which
the Excess Contribution was made and for all subsequent Plan Years for which
the Excess Contribution remains uncorrected.

The amount of Excess Contribution to be distributed to a Highly
Compensated Employee for a Plan Year will be reduced by any Excess Deferrals
previously distributed to the Participant for the calendar year ending with or
within the Plan Year in accordance with Code Section 402(g)(2).

Excess Contributions will be treated as Employer contributions for
purposes of Code Sections 404 and 415 even if distributed from the Plan.

(d)          Application
of Contribution Percentage Test

Employee After-tax Contributions and Matching Contributions,
disregarding any Matching Contributions which are treated as Elective
Contributions with respect to the Deferral Percentage Test, must satisfy the
Contribution Percentage Test.  The Plan
Administrator will determine as soon as administratively feasible after the end
of the Plan Year whether the Contribution Test has been satisfied.  If the Contribution Percentage Test is not
satisfied, the Employer may elect to make an additional contribution to the
Plan for the benefit of the Non-Highly Compensated Group.  The additional contribution will be treated
as a Nonelective Contribution.

If the Contribution Percentage Test is still not satisfied, then after
the close of the Plan Year in which the Excess Aggregate Contribution arose but
within 12 months after the close of that Plan Year, the Plan Administrator will
distribute (or forfeit, to the extent not vested) the Excess Aggregate
Contributions, together with allocable income, to Participants of the Highly
Compensated Group to the extent necessary to satisfy the Contribution
Percentage Test.  Failure to do so will
cause the Plan to not satisfy the requirements of Code Section 401(a)(4) for
the Plan Year for which the Excess Aggregate Contribution was made and for all
subsequent Plan Years for which the Excess Aggregate Contribution remains
uncorrected.

The determination of any Excess Aggregate Contributions will be made
after the recharacterization of any Excess Contributions as Employee After-tax
Contributions.

Excess Aggregate Contributions, including forfeited Matching
Contributions, will be treated as Employer contributions for purposes of Code
Sections 404 and 415 even if they are distributed from the Plan.

Forfeited Matching Contributions that are reallocated to the Accounts
of other Participants are treated as Annual Additions under Code Section 415
for the Participant whose Accounts they are reallocated to and for the
Participants from whose Accounts they are forfeited.

If in a given Plan Year, a) the Employer has made a Safe Harbor
Employer Nonelective Contribution or a Safe Harbor Employer Matching
Contribution for such Plan Year within 

 11-12
 

 

the time prescribed under this Section 11.02 to be considered a
contribution for such Plan Year, b) meets the notice requirements of Code
Section 401(k)(12)(D), and c) (i) the matching contribution on behalf of any
Participant in such year have not been made with respect to Employee Pre-tax
Contributions in excess of six (6) percent of a Participant’s Compensation,
(ii) the rate of matching contribution does not increase as the rate of
Employee Pre-tax Contributions increase, and (iii) the Employer Matching
Contributions with respect to any Participants who are Highly Compensated
Employee at any rate of pre-tax contribution is not greater than that with
respect to Participants who are Non-Highly Compensated Employees, then the Plan
shall be deemed to satisfy the Contributions Percentage Test for such Plan
Year.

(e)          Reduction
of Excess Amounts

For the purpose of determining the total amounts of Excess
Contributions and/or Excess Aggregate Contributions to be recharacterized,
returned to Participants or forfeited as the case may be, the total Excess
Contribution or total Excess Aggregate Contribution will be reduced in a manner
so that the Deferral Percentage or the Contribution Percentage (Relevant
Percentage) of the affected Participant(s) with the highest Relevant Percentage
will first be lowered to a point not less than the level of the affected
Participant(s) with the next highest Relevant Percentage.  If further overall reductions are required to
satisfy the relevant test, each of the above Participants’ (or groups of
Participants’) Relevant Percentage will be lowered to a point not less than the
level of the affected Participant(s) with the next highest Relevant Percentage,
and so on continuing until sufficient total reductions have occurred to achieve
satisfaction of the relevant test.

The total Excess Contributions or Excess Aggregate Contributions so
determined will then be recharacterized, returned to Participants or forfeited
in such a manner that the amount of such contributions allocated to the Highly
Compensated Participant(s) by or for whom the highest amount of such
contributions have been made during the Plan Year will first be lowered to an
amount not less than the amount made by or for the Highly Compensated
Participant with the next highest amount of such contributions made during the
Plan Year.  If further reductions are
required to reduce the accounts of Highly Compensated Participants by the total
of all Excess Contributions or Excess Aggregate Contributions, each of the above
Participant’s relevant contributions will be lowered to a point not less than
the level of the Highly Compensated Participant with the next highest amount of
such contributions made during the Plan Year, and so on, continuing until
sufficient total reductions have been made to equal the total amount of Excess
Contributions and/or excess Aggregate Contributions as the case may be.

(f)            Priority
of Reductions

The Plan Administrator will determine the method and order of
correcting Excess Contributions and Excess Aggregate Contributions.  The method of correcting Excess Contributions
and Excess Aggregate Contributions must meet the requirements of Code Section
401(a)(4).  The determination of whether
a rate of Matching Contribution discriminates under Code Section 401(a)(4) will
be made after making any corrective distributions of Excess Deferrals, Excess
Contributions and Excess Aggregate Contributions.

 11-13
 

 

Excess Aggregate Contributions (and any attributable income) will be
corrected first, by distributing any excess Employee After-tax Contributions
(and any attributable income);  then by
distributing vested excess Matching Contributions (and any attributable
income);  and finally, by forfeiting or
distributing non-vested Matching Contributions (and any attributable
income).  The Plan will not distribute
Employee After-tax Contributions while the Matching Contributions based upon
those Employee After-tax Contributions remain allocated.

(g)         Income

The income allocable to any Excess Contribution made to a given Account
for a given Plan Year will be equal to the total income allocated to the
Account for the Plan Year, multiplied by a fraction, the numerator of which is
the amount of the Excess Contribution and the denominator of which is equal to
the sum of the balance of the Account at the beginning of the Plan Year plus
the Participant’s Elective Contributions and amounts treated as Elective
Contributions for the Plan Year.

The income allocable to any Excess Aggregate Contribution made to a
given Account for a given Plan Year will be equal to the total income allocated
to the Account for the Plan Year, multiplied by a fraction, the numerator of
which is the amount of the Excess Aggregate Contribution and the denominator of
which is equal to the sum of the balance of the Account at the beginning of the
Plan Year plus the Participant’s Employee After-tax and Matching Contributions
and amounts treated as Employee After-tax and Matching Contributions for the
Plan Year.

Notwithstanding the foregoing, the Plan may use any reasonable method
for computing the income allocable to any Excess Contribution or Excess
Aggregate Contribution provided the method does not violate Code Section
401(a)(4), is used consistently for all corrective distributions under the Plan
for the Plan Year, and is used by the Plan for allocating income to the
Participants’ Accounts.

Income includes all earnings and appreciation, including interest,
dividends, rents, royalties, gains from the sale of property, and appreciation
in the value of stocks, bonds, annuity and life insurance contracts and other
property, regardless of whether the appreciation has been realized.

(h)         Allocation
of Qualified Matching Contributions.

The Employer may designate all or a portion of its Matching
Contribution as a Qualified Matching Contribution in order to satisfy
nondiscrimination requirements.  To be
eligible for such designation, such contributions must be contributed no later
than the time prescribed by Treasury Regulations to be considered, based upon
whether the Employer is utilizing the current year or prior year testing
method.  To the extent that the Employer designates all
or any portion of contributions for the Plan Year as a Qualified Matching
Contribution as defined in Section 11.02(b)(18), such contribution will be
allocated to the Employee Pre-tax or Qualified Employer Matching Accounts of
some or all eligible Participant(s) (i) beginning with such eligible
Participant(s) who have the lowest testing Compensation as defined in Section
11.02(b), until such eligible Participant(s) reach their Defined Contribution
Limit as 

 11-14
 

 

defined in Section 10.03(d), or the amount designated as Qualified
Matching Contribution is fully allocated; 
and then (ii) continuing with successive eligible Participants or groups
of eligible Participants in the same manner until the amount of the Qualified
Matching Contribution is fully allocated.

(i)            Allocation
of Qualified Non-elective Contributions.

The Employer may designate all or a portion of its Non-elective
Contribution as a Qualified Non-elective Contribution in order to satisfy
nondiscrimination requirements.  To be
eligible for such designation, such contributions must be contributed no later
than the time prescribed by Treasury Regulations to be considered, based upon
whether the Employer is utilizing the current year or prior year testing
method.  To the extent that the Employer designates all
or any portion of contributions for the Plan Year as a Qualified Non-elective
Contribution as defined in Section 11.02(b)(18), such contribution will be
allocated to the Employee Pre-tax Accounts of some or all eligible
Participant(s) (i) beginning with such eligible Participant(s) who have the
lowest testing Compensation as defined in Section 11.02(b), until such eligible
Participant(s) reach their Defined Contribution Limit as defined in Section
10.03(d), or the amount designated as Qualified Non-elective Contribution is
fully allocated;  and then (ii)
continuing with successive eligible Participants or groups of eligible
Participants in ascending order of testing Compensation in the same manner
until the amount of the Qualified Non-elective Contribution is fully allocated.

(j)            Treatment
as Elective Contributions

The Plan Administrator may, in its discretion, treat all or any portion
of Qualified Nonelective Contributions or Qualified Matching Contributions or
both, whether to this Plan or to any other qualified plan which has the same
Plan Year and is maintained by the Employer or a Related Employer, as Elective
Contributions for purposes of satisfying the Deferral Percentage Test if they
meet all of the following requirements:

(1)           All
Nonelective Contributions, including the Qualified Nonelective Contributions
treated as Elective Contributions for purposes of the Deferral Percentage Test,
satisfy the requirements of Code Section 401(a)(4);

(2)           Any
Nonelective Contributions which are not treated as Elective Contributions for
purposes of the Deferral Percentage Test or as Matching Contributions for
purposes of the Contribution Percentage Test satisfy the requirements of Code
Section 401(a)(4);

(3)           The
Qualified Matching Contributions which are treated as Elective Contributions
for purposes of the Deferral Percentage Test are not taken into account in
determining whether any Employee After-tax Contributions or other Matching
Contributions satisfy the Contribution Percentage Test;

(4)           Any
Matching Contributions which are not treated as Elective Contributions for
purposes of the Deferral Percentage Test satisfy the requirements of Code
Section 401(m);  and

 11-15
 

 

(5)           The plan
which includes the Cash or Deferred Arrangement and the plan or plans to which
the Qualified Nonelective Contributions and Qualified Matching Contributions
are made could be aggregated for purposes of Code Section 410(b).

(k)        Treatment
as Matching Contributions

The Plan Administrator may, in its discretion, treat all or any portion
of Qualified Nonelective Contributions or Elective Contributions or both,
whether to this Plan or to any other qualified plan which has the same Plan
Year and is maintained by the Employer or a Related Employer, as Matching
Contributions for purposes of satisfying the Contribution Percentage Test if
they meet all of the following requirements:

(1)           All
Nonelective Contributions, including the Qualified Nonelective Contributions
treated as Matching Contributions for purposes of the Contribution Percentage
Test, satisfy the requirements of Code Section 401(a)(4);

(2)           Any
Nonelective Contributions which are not treated as Elective Contributions for
purposes of the Deferral Percentage Test or as Matching Contributions for
purposes of the Contribution Percentage Test satisfy the requirements of Code
Section 401(a)(4);

(3)           The
Elective Contributions which are treated as Matching Contributions for purposes
of the Contribution Percentage Test are not taken into account in determining
whether any other Elective Contributions satisfy the Deferral Percentage Test;

(4)           The
Qualified Nonelective Contributions and Elective Contributions which are
treated as Matching Contributions for purposes of the Contribution Percentage
Test are not taken into account in determining whether any other contributions
or benefits satisfy Code Section 401(a);

(5)           All
Elective Contributions, including those treated as Matching Contributions for
purposes of the Contribution Percentage Test, satisfy the requirements of Code
Section 401(k)(3);  and

(6)           The plan
that takes Qualified Nonelective Contributions and Elective Contributions into
account in determining whether Employee After-tax and Matching Contributions
satisfy the requirements of Code Section 401(m)(2)(A) and the plan or plans to
which the Qualified Nonelective Contributions and Elective Contributions are
made could be aggregated for purposes of Code Section 410(b).

(l)            
Aggregation of Plans

If the Employer or a Related Employer sponsors one or more other plans
which include a Cash or Deferred Arrangement, the Employer may elect to treat
any two or more of such plans as an aggregated single plan for purposes of
satisfying Code Sections 401(a)(4), 401(k) and 410(b).  The Cash or Deferred Arrangements included in
such aggregated plans will be treated as a single Arrangement for purposes of
this Section.  However, only those plans
that have the same plan year may be so aggregated.

 11-16
 

 

If the Employer or a Related Employer sponsors one or more other plans
to which Employee After-tax Contributions or Matching Contributions are made,
the Employer may elect to treat any two or more of such plans as an aggregated
single plan for purposes of satisfying Code Sections 401(a)(4), 401(m) and 410(b).  However, only those plans that have the same
plan year may be so aggregated.

Any such aggregation must be made in accordance with Treasury
Regulation 1.401(k)-1(b)(3).  For
example, contributions and allocations under the portion of a plan described in
Code Section 4975(e)(7) (an ESOP) may not be aggregated with the portion of a
plan not described in Code Section 4975(e)(7) (a non-ESOP) for purposes of
determining whether the ESOP or non-ESOP satisfies the requirements of Code
Sections 401(a)(4), 401(k), 401(m) and 410(b).

Plans that could be aggregated under Code Section 410(b) but that are
not actually aggregated for a Plan Year for purposes of Code Section 410(b) may
not be aggregated for purposes of Code Sections 401(k) and 401(m).

(m) Repeal of Multiple Use Test

Notwithstanding
any provision to the contrary, the multiple use test described in Treasury
Regulation Section 1.401(m)-2 and this Section of the Plan shall not apply for
Plan Years beginning after December 31, 2001.

11.03      Failure
to Meet Minimum Coverage Requirements

For any Plan Year, if the Plan fails to satisfy the ratio percentage
test under Code Section 410(b)(1)(B) for a Contribution Period, the Employer
may elect to suspend the requirement under Section 3.03(b) that a Participant
be employed on the last day of the Plan Year and/or be credited with a minimum
number of hours of service to be eligible to share in the allocation of such
contribution for such Contribution Period.

If this paragraph applies for a Plan Year, the Employer will suspend
the requirements to share in the allocation of a contribution for a given
Contribution Period in the following manner.

(a)                                  All
Participants who are (i) Nonhighly Compensated Employees, (ii) employed by the
Employer on the last day of the Plan Year and (iii) not otherwise benefiting
under the Plan, shall be included in the group of Participants eligible to
receive an allocation in accordance with this section.

(b)                                 The
Employer shall contribute on behalf of such number of Participants in this
group, beginning with the Participant with the lowest Compensation and
continuing in ascending order, from the lowest to the highest Compensation,
until the number of Participants benefiting under this Section, within the
meaning of Treas. Reg. § 1.410(b)-3(a)(2), is sufficient for the Plan to
satisfy the ratio percentage test under Code Section 410(b)(1)(B).

(c)                                  Should
the Plan fail to satisfy the coverage requirements of Code Section 410(b) after
the application of paragraph (2), then the next group of Participants eligible
to share in any 

 11-17
 

 

allocation made hereunder, shall be those former
Participants who (i) separated from service during the Plan Year;  (ii) were Nonhighly Compensated
Employees;  and (iii) completed more than
500 hours during the Plan Year.

(d)                                 The
Employer shall contribute on behalf of such number of Participants in this
group, beginning with the Participant with the lowest Compensation and
continuing in ascending order, from the lowest to the highest Compensation,
until the number of Participants benefiting under this Section, within the
meaning of Treas. Reg. § 1.410(b)-3(a)(2), is sufficient for the Plan to
satisfy the ratio percentage test under Code Section 410(b)(1)(B).

(e)                                  If
two or more Employees in a class have the same Compensation, the Employer will
suspend the requirements to share in the allocation of the contribution for all
such Employees, irrespective of whether the Plan can satisfy the coverage
requirements by accruing benefits for fewer than all such Employees.

(f)                                    If
the Employer’s Plan includes matching contributions subject to Code Section
401(m), this suspension of accrual requirements applies separately to the Code
Section 401(m) portion of the Plan, and the Employer will treat an Employee as
benefiting under that portion of the Plan if the Employee is an Eligible
Employee for purposes of the Code Section 401(m) nondiscrimination test.

 11-18

 

Article
12

TOP-HEAVY PROVISIONS

The following shall apply for purposes of determining
whether the Plan is a Top-Heavy Plan under Code Section 416(g) for Plan Years
beginning after December 31, 2001, and whether the Plan satisfies the minimum
benefit requirements of Code Section 416(g) for such years.

12.01      Top-Heavy
Definitions

(a)          Aggregate
Account

Aggregate Account means, with respect to each Participant, the value of
all accounts maintained on behalf of the Participant, whether attributable to
Employer or Employee contributions, used to determine Top-Heavy Plan status
under the provisions of a defined contribution plan.  A Participant’s Aggregate Account as of the
Determination Date will be the sum of:

(1)           the
balance of his Account(s) as of the most recent valuation date occurring within
a 12-month period ending on the Determination Date (excluding any amounts
attributable to deductible voluntary employee contributions);  plus

(2)           contributions
that would be allocated as of a date not later than the Determination Date,
even though those amounts are not yet made or required to be made;  plus

(3)           only Plan
Distributions made within the Plan Year that includes the Determination Date
will be considered except for distributions made for a reason other than a separation
from Service, death or disability, in which case Distributions in the 4
preceding Plan Years will also be considered.

(b)          Aggregation
Group

Aggregation Group means either a Required Aggregation Group or a
Permissive Aggregation Group as hereinafter determined.

(1)         Required Aggregation Group

Each plan of the Employer in which a Key Employee is a Participant, and
each other plan of the Employer which enables any plan in which a Key Employee
participates to meet the requirements of Code Section 401(a)(4) or 410, will be
aggregated and the resulting group will be known as a Required Aggregation
Group.

Each plan in the Required Aggregation Group will be considered a
Top-Heavy Plan if the Required Aggregation Group is a Top-Heavy Group.  No plan in the Required Aggregation Group
will be considered a Top-Heavy Plan if the Required Aggregation Group is not a
Top-Heavy Group.

 12-1
 

 

(2)         Permissive Aggregation Group

The Employer may also include any other plan not required to be
included in the Required Aggregation Group, provided the resulting group (to be
known as a Permissive Aggregation Group), taken as a whole, would continue to
satisfy the provisions of Code Sections 401(a)(4) and 410.

Only a plan that is part of the Required Aggregation Group will be
considered a Top-Heavy Plan if the Permissive Aggregation Group is a Top-Heavy
Group.  No plan in the Permissive
Aggregation Group will be considered a Top-Heavy Plan if the Permissive
Aggregation Group is not a Top-Heavy Group.

Only those plans of the Employer in which the Determination Dates fall
within the same calendar year will be aggregated in order to determine whether
the plans are Top-Heavy Plans.

(c)          Determination
Date

Determination Date means the last day of the preceding Plan Year, or,
in the case of the first Plan Year, the last day of the first Plan Year.

(d)          Key
Employee

Effective January 1, 2002, Key Employee means any Employee or
Former Employee (including any deceased Employee) who at any time during the
Plan Year that includes the Determination Date was an officer of the Employer
having Annual Compensation greater than $130,000 (as adjusted under Code
Section 416(i)(1) for Plan Years beginning after December 31, 2002), a
5-percent owner of the Employer, or a 1- percent owner of the Employer having Annual
Compensation of more than $150,000. For this purpose, Annual Compensation means
compensation within the meaning of Code Section 415(c)(3).  The determination of who is a Key Employee
will be made in accordance with Code Section 416(i)(1) and the applicable
regulations and other guidance of general applicability issued thereunder.

(e)          Non-Key
Employee

Non-Key Employee means any Employee (and his Beneficiaries) who is not
a Key Employee.

(f)            Plan
Distributions

The Present Value of
Accrued Benefits and the amounts of account balances of an Employee as of the
Determination Date shall be increased by the Plan 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 1-year period ending on the
Determination Date. The preceding sentence shall also apply to distributions
under a terminated plan which, had it not been terminated, would have been
aggregated with the Plan under Code Section 416(g)(2)(A)(i).  In the case of a Plan Distribution made for a
reason other than separation from service, death, or disability, this provision
shall be applied by substituting “5-year period” for “1-year period.”

 12-2
 

 

(g)         Present
Value of Accrued Benefit

In the case of a defined benefit plan, a Participant’s Present Value of
Accrued Benefit, for Top-Heavy determination purposes, will be determined using
the following rules:

(1)           The
Present Value of Accrued Benefit will be determined as of the most recent “valuation
date” within a 12-month period ending on the Determination Date.

(2)           For the
first Plan Year, the Present Value of Accrued Benefit will be determined as if
(A) the Participant terminated service as of the Determination Date;  or (B) the Participant terminated service as
of the valuation date, but taking into account the estimated Present Value of
Accrued Benefits as of the Determination Date.

(3)           For any
other Plan Year, the Present Value of Accrued Benefit will be determined as if
the Participant terminated service as of the valuation date.

(4)           The
valuation date must be the same date used for computing the defined benefit
plan minimum funding costs, regardless of whether a calculation is performed
that plan year.

(5)           A
Participant’s Present Value of Accrued Benefit as of a Determination Date will
be the sum of:

(A)      the present
value of his Accrued Benefit determined using the actuarial assumptions which
are specified below;  plus

(B)        any Plan
Distributions made within the Plan Year that includes the Determination Date or
within the four preceding Plan Years; 
plus

(C)        any employee
contributions, whether voluntary or mandatory. 
However, amounts attributable to qualified voluntary employee
contributions, as defined in Code Section 219(e)(2) will not be considered to
be a part of the Participant’s Present Value of Accrued Benefit.

For purposes of this Section, the present value of a Participant’s
Accrued Benefit will be equal to the greater of the present value determined
using the actuarial assumptions which are specified in the defined benefit plan
or the present value determined using the Applicable Interest Rate and the
Applicable Mortality Table.

The Applicable Interest Rate is the rate equal to the annual rate of
interest on 30-year Treasury securities for the month of November preceding the
first day of the year of distribution or such other time as the Secretary of
the Treasury may by regulations prescribe.

The Applicable Mortality Table is the table based on the mortality
rates in Revenue Ruling 95-6 or such other table as the Secretary of the
Treasury may later prescribe.

(6)           Solely for
the purpose of determining if this Plan (or any other plan included in a
Required Aggregation Group of which this Plan is a part) is Top-Heavy, the
Accrued Benefit of any Employee other than a Key Employee will be determined
under

 12-3
 

 

(A)      the method, if
any, that uniformly applies for accrual purposes under all plans maintained by
the Employer or any Related Employer, or

(B)        if there is
no such method, as if the benefit accrued no more rapidly than the slowest
accrual rate permitted under the fractional accrual rate of Code Section
411(b)(1)(C).

(h)         Single
Sum Benefit

The Single Sum Benefit for any Participant in a defined benefit pension
plan will be equal to his Present Value of Accrued Benefit.  The Single Sum Benefit for any Participant in
a defined contribution plan will be equal to his Aggregate Account.

(i)            
Top-Heavy Group

Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the Single Sum Benefits of all Key Employees under all
plans included in the group exceeds 60% of a similar sum determined for all
Participants.

Super Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the sum of (1) the Single Sum Benefits of all Key Employees
under all defined benefit plans included in the group, plus (2) the Single Sum
Benefit of all Key Employees under all defined contribution plans included in
the group exceeds 90% of a similar sum determined for all Participants.

(j)            
Top-Heavy Plan

This Plan will be a Top-Heavy Plan for any Plan Year beginning after
December 31, 1983, in which, as of the Determination Date, the Single Sum
Benefits of all Key Employees exceed 60% of the Single Sum Benefits of all
Participants under this Plan.

This Plan will be a Super Top-Heavy Plan for any Plan Year beginning
after December 31, 1983, in which, as of the Determination Date, the Single Sum
Benefits of all Key Employees exceed 90% of the Single Sum Benefits of all
Participants under this Plan.

If any Participant is a Non-Key Employee for a given Plan Year, but was
a Key Employee for any prior Plan Year, the Participant’s Single Sum Benefit
will not be taken into account for purposes of determining whether this Plan is
a Top-Heavy or Super Top-Heavy Plan (or whether any Aggregation Group which
includes this Plan is a Top-Heavy or Super Top-Heavy Group).

If an individual has performed no services for the Employer at any time
during the 5-year period ending on the Determination Date, any Single Sum
Benefit of such individual will not be taken into account for purposes of
determining whether this Plan is a Top-Heavy or Super Top-Heavy Plan (or
whether any Aggregation Group which includes this Plan is a Top-Heavy Group or
Super Top-Heavy Group).

 12-4
 

 

12.02      Minimum
Benefit for a Top-Heavy Plan

(a)          Minimum
Allocation to a Defined Contribution Plan

Notwithstanding anything contained herein to the contrary, for any Plan
Year in which this Plan is determined to be Top-Heavy, a Participant who is a
Non-Key Employee (including any Employee who is excluded from the Plan because
his Compensation is less than a stated amount) will be entitled to a minimum
allocation of Employer contributions plus any reallocated Forfeitures, in
addition to any Matching Contributions allocated under the Plan, equal to 3% of
the Non-Key Employee’s Compensation received during the Plan Year while a
Participant in the Plan. This minimum allocation will be deposited to the
Participant’s Account specified by the Plan Administrator, will be subject to
the vesting and distribution rules pertaining to the Account to which it is
deposited, and will be provided to each Non-Key Employee who is a Participant
and is employed by the Employer on the last day of the Plan Year whether or not
he or she is an otherwise eligible Participant or fails to make any mandatory
Employee contribution to the Plan.

The percentage referred to in the preceding paragraph will not exceed
the percentage of Compensation at which Elective Contributions to a Cash or
Deferred Arrangement and Employer contributions are made or allocated to the
Key Employee for whom such percentage is the largest;  provided, however, this sentence will not
apply if the Plan is required to be included in an Aggregation Group to meet
the requirements of Code Sections 401(a)(4) or 410(b).

For any Plan Year, the minimum allocation required under this Section
will be reduced by any other contributions made by the Employer which may be
taken into account in satisfying the requirements of Code Section 416(c)(2).  However, neither Elective Contributions to a
Cash or Deferred Arrangement nor Matching Contributions for Non-Key Employees
will be taken into account in satisfying the requirements of Code Section
416(c)(2).

(b)          Minimum
Accrued Benefit under a Defined Benefit Plan

In lieu of the foregoing, the requirements of Code Section 416(c) will
be satisfied in any Plan Year in which a Non-key Employee is a Participant in
both this Plan and a defined benefit pension plan included in a Required
Aggregation Group which is top-heavy if the Participant is entitled to a
minimum accrued benefit under the defined benefit plan equal to the greater of
(1) the accrued benefit provided under the defined benefit plan or (2) a
monthly benefit in the form of a straight life annuity (with no ancillary benefits)
beginning at normal retirement date equal to the Participant’s average monthly
compensation (which means the average rate of Compensation during the five
consecutive years, as defined for purposes of determining average monthly
compensation, in which the Participant had the highest Compensation) multiplied
by the lesser of (1) 2% for each year of benefit service performed while
actually participating in the plan during a Plan year in which the plan is
determined to be Top-Heavy, or (2) 20%. 
The defined benefit plan may not satisfy this requirement through
Employer contributions to Social Security.

 12-5
 

 

(c)          Minimum
Benefits

Employer matching contributions will 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 will be met in another
plan, such other plan.  Employer matching
contributions that are used to satisfy the minimum contribution requirements
will be treated as matching contributions for purposes of the Actual
Contribution Percentage Test and other requirements of Code Section 401(m).

12.03      Minimum
Vesting Schedule for a Top-Heavy Plan

In any Plan Year in which the Plan is determined to be a Top-Heavy
Plan, a Participant’s Vested Accrued Benefit for Employer contributions
credited during that Plan Year will be the Vested Accrued Benefit determined by
applying the Vesting Schedule provided in Article 1.

The minimum vesting requirements of this Article will apply to all
Accounts of a Participant that include contributions subject to the Minimum
Vesting Schedule for a Top-Heavy Plan.

If in any subsequent Plan Year the Plan ceases to be a Top-Heavy Plan,
the minimum vesting requirements of this Article will continue to apply to all
Accounts of the Participant that include contributions subject to the Minimum
Vesting Schedule for a Top-Heavy Plan.

 12-6

 

Article
13

TRUSTEE AND TRUST FUND

13.01      Acceptance
of Trust

The Trustee, by signing this Agreement, accepts this Trust and agrees
to perform the duties of the Trustee in accordance with the terms and
conditions set forth herein.

13.02      Trust
Fund

(a)          Purpose
and Nature

The Trustee will establish and maintain a Trust Fund for purposes of
providing a means of accumulating the assets necessary to provide the benefits
which become payable under the Plan.  The
Trustee will receive, hold and invest all contributions made by the Employer,
any Participating Employers, and the Participants, including the investment
earnings thereon.  The Trust Fund arising
from such contributions and earnings will consist of all assets held by the
Trustee under the Plan and Trust.  The
Trustee will manage the Trust Fund without distinction between principal and
income.  All benefits payable under the
Plan will be paid by the Trustee from the Trust Fund.

Any person having any claim under the Plan will look solely to the
assets of the Trust Fund for satisfaction. 
In no event will the Plan Administrator, the Employer, any Employees,
any officer of the Employer or any agents of the Employer or the Plan
Administrator be liable in their individual capacities to any person
whomsoever, under the provisions of this Plan and Trust, except as provided by
law.

The Trust Fund will be used and applied only in accordance with the
provisions of the Plan and Trust, to provide the benefits thereof, and no part
of the corpus or income of the Trust Fund will be used for, or diverted to,
purposes other than for the exclusive benefit of the Participants or their
Beneficiaries entitled to benefits under the Plan, except to the extent
specifically provided elsewhere herein.

The Trust Fund is intended to be a “domestic trust” for purposes of
Code Section 7701(a)(30)(E).  In such
regard, the Trust Fund will be administered exclusively in the United States
and will be subject to the jurisdiction of courts within the United States.  Notwithstanding any provision of the Plan, to
the extent required to satisfy Code Section 7701(a)(30)(E), all substantial
decisions concerning the Trust Fund, including decisions regarding (i) the
establishment, operation and termination of the Trust Fund, and (ii) the
designation, termination and replacement of the Plan’s Trustee, will be made by
individuals who are United States Persons, as defined in Code Section
7701(a)(30).

 13-1
 

 

(b)          Operation
of Trust Fund

The Trust Fund will be maintained in accordance with the accounting
requirements of the Plan.  No Participant
will have any right to any specific asset or any specific portion of the Trust
Fund prior to distribution of benefits. 
Withdrawals from the Trust Fund will be made to provide benefits to
Participants and Beneficiaries in the amounts specified by the Plan, and to pay
expenses agreed to in writing by the Plan Administrator.

(c)          Investments

The Trustee will invest the Trust Fund in accordance with the proper
directions of the Plan Administrator or Investment Manager.

(d)          Plan
Sponsor Direction of Investment

The Plan Sponsor will have the right to direct the Trustee with respect
to the investment and reinvestment of assets comprising the Trust Fund.  The Trustee and the Plan Sponsor (or the Plan
Administrator or an Investment Committee appointed by the Plan Sponsor) will
execute a letter of agreement as a part of this Plan containing such
conditions, limitations and other provisions they deem appropriate before the
Trustee will follow any Plan Sponsor direction with respect to the investment
or reinvestment of any part of the Trust Fund. 
Such letter of agreement may provide for Participant direction with
respect to the investment and reinvestment of a Participant’s Accounts in
accordance with Article 4.

Except to the extent required by ERISA or otherwise provided in a
letter of agreement or in this Section 13, the Trustee will have no duty or
responsibility to review, initiate action, or make recommendations regarding
Trust assets and will retain such assets until directed by the Plan administrator
to dispose of such assets.

(e)          Participant
Direction in Assets other than Investment Funds Authorized by the Plan
Administrator

If permitted under Section 4.02(i), each Participant may have
investment power over an account maintained for him, and may direct the
investment and reinvestment of assets of the account subject to such
conditions, limitations and other provisions as may be required by the Plan
Administrator and by the Trustee.  Such
direction will be furnished to the Trustee under procedures agreed to by the
Trustee and the Plan Administrator.  To
the extent provided under ERISA Section 404(c), the Trustee and the Plan
Administrator will not be liable for any loss, or by reason of any breach, which
results from such Participant’s exercise of control.  The Trustee will keep separate accounts for
each such Participant with respect to any portion of the Participant’s Accounts
to which this paragraph applies.  The
Trustee will have no duty or responsibility to review or make recommendations
regarding investments made at the direction of the Participant and will be
required to act only upon receipt of proper directions.  A Participant will not have authority to
direct the investment of assets in an account subject to this paragraph in a
loan to any Participant, including himself, or “collectibles” within the
meaning of Code Section 408(m)(2).

 13-2
 

 

13.03      Receipt
of Contributions

The Trustee will be accountable to the Employer for the funds
contributed to it, but will have no duty to see that the contributions received
comply with the provisions of the Plan. 
The Trustee will not be obligated to collect any contributions from the
Employer or the Participants.  The
Trustee will have no duty to compute any amount required to be transferred or
paid to it by the Employer.

13.04      Powers
of the Trustee

The Trustee’s authority and discretion with respect to the Trust Fund
will at all times be subject to the proper written directions of the Plan
Administrator or Investment Manager.  The
Trustee is authorized and empowered, but not by way of limitation, with the
following powers, rights and duties:

(a)          To invest any part or
all of the Trust Fund in any common or preferred stocks, open-end or closed-end
mutual funds, United States retirement plan bonds, corporate bonds, debentures,
convertible debentures, commercial paper, U.S. 
Treasury bills, book entry deposits with the United States Federal
Reserve Bank or System, Master Notes or similar arrangements sponsored by the
Trustee or any other financial institution as permitted by law, improved or
unimproved real estate situated in the United States, mortgages, notes or other
property of any kind, real or personal, as a prudent man would so invest under
like circumstances with due regard for the purposes of this Plan;

(b)         To hold that portion of
the Trust Fund as the Trustee may deem necessary for ordinary administration
and for the disbursement of funds in cash, without liability for interest, by
depositing the same in any bank (including deposits which bear a reasonable
rate of interest in a bank or similar financial institution supervised by the
United States or a State, even where the bank or financial institution is the
Trustee, or otherwise is a fiduciary of the Plan, including The Charles Schwab
Trust Company), subject to the rules and regulations governing such deposits,
and without regard to the amount of any such deposit.

(c)          To manage, sell,
contract to sell, grant options to purchase, convey, exchange, transfer,
abandon, improve, repair, insure, lease for any term even though commencing in
the future or extending beyond the term of the Trust, and otherwise deal with
all property, real or personal, in such manner, for such considerations and on
such terms and conditions as the Trustee will decide;

(d)         To credit and distribute
the Trust as directed by the Plan Administrator or any agent of the Plan
Administrator.  The Trustee will not be
obliged to inquire as to whether any payee or distributee is entitled to any
payment or whether the distribution is proper or within the terms of the Plan,
or as to the manner of making any payment or distribution.  The Trustee will be accountable only to the
Plan Administrator for any payment or distribution made by it in good faith on
the order or direction of the Plan Administrator or any agent of the Plan
Administrator;

 13-3
 

 

(e)          To borrow money from any
person other than a party in interest of the Plan (unless covered by a
prohibited transaction exemption) with or without giving security, and to
assume indebtedness, extend mortgages and encumber by mortgage or pledge;

(f)            To compromise,
contest, arbitrate, or abandon claims and demands, in its discretion;

(g)         To have with respect to
the Trust all of the rights of an individual owner, whether specifically
referred to or not in this document, including the power to give proxies, to
participate in any voting trusts, mergers, consolidations or liquidations, to
exercise or sell stock subscriptions or conversion rights;

(h)         To hold any securities or
other property in the name of the Trustee or its nominee, or in another form as
it may deem reasonable, with or without disclosing the trust relationship;

(i)             To perform any and
all other acts in its judgment necessary or appropriate for the proper and
advantageous management, investment and distribution of the Trust;

(j)             To compromise,
arbitrate, or otherwise adjust or settle claims in favor of or against the
Trust and to deliver or accept consideration in either total or partial
satisfaction of any indebtedness or other obligation, and to continue to hold
property so received for the period of time that the Trustee deems appropriate;

(k)          To file all tax forms or
returns required of the Trustee;

(l)             To begin, maintain or
defend any litigation necessary in connection with the administration of the
Plan, except that the Trustee will not be obligated to or required to do so
unless indemnified to its satisfaction; 
and

(m)       To keep any or all of the
Trust property at any place or places within the United States or abroad, or
with a depository or custodian at such place or places;  provided, however, that the Trustee may not
maintain the indicia of ownership of any assets of the Plan outside the
jurisdiction of the District Courts of the United States, except as may be
expressly authorized in U.S. Treasury or U.S. Department of Labor regulations.

13.05      Investment
in Common or Collective Trust Funds

Notwithstanding the provisions of Section 13.04, the Plan Sponsor
specifically authorizes the Trustee to invest all or any portion of the assets
comprising the Trust Fund in any common or collective trust fund which at the
time of the investment provides for the pooling of the assets of plans
qualified under Code Section 401(a).  The
authorization applies only if such common or collective trust fund:  (a) is exempt from taxation under Code
Section 584 or 501(a);  (b) if exempt
under Code Section 501(a), expressly limits participation to pension and profit
sharing trusts which are exempt under Code Section 501(a) by reason of
qualifying under Code Section 401(a); 
(c) prohibits that part of its corpus or income which equitably belongs
to any participating trust from being used for or diverted to any purposes
other than for the exclusive benefit of the Employees or their Beneficiaries
who are entitled to benefits under such participating trust;  (d) prohibits assignment by a participating
trust of any part of its equity or 

 13-4
 

 

interest in the group trust;  and
(e) the sponsor of the group trust created or organized the group trust in the
United States and maintains the group trust at all times as a domestic trust in
the United States.  The provisions of the
common or collective trust fund agreement, as amended by the Trustee from time
to time, are by this reference incorporated within this Plan and Trust.  The provisions of the common or collective
trust fund will govern any investment of Plan assets in that fund.  This provision constitutes the express
permission required by Section 408(b)(8) of ERISA.

13.06      Investment
in Insurance Company Contracts

The Trustee may invest any portion of the Trust Fund in a deposit
administration, guaranteed investment or similar type of investment contract
(hereinafter referred to as Contract); 
provided, however, that no such Contract may provide for an optional
form of benefit which would not be provided for under the provisions
hereof.  The Trustee will be the complete
and absolute owner of Contracts held in the Trust Fund.

The Trustee may convert from one form to another any Contract held in
the Trust Fund;  designate any mode of
settlement;  sell or assign any Contract
held in the Trust Fund;  surrender for
cash any Contract held in the Trust Fund; 
agree with the insurance company issuing any Contract to any release,
reduction, modification or amendment thereof; 
and, without limitation of any of the foregoing, exercise any and all of
the rights, options and privileges that belong to the absolute owner of any
Contract held in the Trust Fund that are granted by the terms of any such
Contract or by the terms of this Agreement.

The Trustee will hold in the Trust Fund the proceeds of any sale,
assignment or surrender of any Contract held in the Trust Fund and any and all
dividends and other payments of any kind received in respect to any Contract
held in the Trust Fund.

13.07      Fees
and Expenses from Fund

The Trustee will be entitled to receive reasonable annual compensation
as may be mutually agreed upon from time to time between the Plan Sponsor and
the Trustee.  The Trustee will pay all
expenses reasonably incurred by it in its administration and investment of the
Trust Fund from the Trust Fund unless the Plan Sponsor pays the expenses.  No person who is receiving full pay from the
Plan Sponsor will receive compensation for services as Trustee.

13.08      Records
and Accounting

The Trustee will keep full and complete records of the administration
of the Trust Fund which the Plan Sponsor and the Plan Administrator may examine
at any reasonable time.  As soon as
practical after the end of each Plan Year and at such other reasonable times as
the Plan Sponsor may direct, the Trustee will prepare and deliver to the Plan
Sponsor and the Plan Administrator an accounting of the administration of the
Trust, including a report on the fair market value of all assets of the Trust
Fund.

 13-5
 

 

13.09      Distribution
Directions

The Trustee will make distributions or transfers from the Trust as
specified in proper directions from the Plan Administrator or his
representative.  The Trustee is
authorized, to the extent required under applicable law, to withhold from
distributions to any payee an amount that the Trustee determines is necessary
to cover federal and state taxes, and the Trustee is required to withhold such
amounts if so directed by the Plan Administrator.  The Trustee will have no liability for making
any distribution or transfer pursuant to the direction of the Plan
Administrator (including amounts withheld pursuant to the previous sentence)
and will be under no duty to make inquiry whether any distribution or transfer
directed by the Plan Administrator is made pursuant to the provisions of the
Plan.

The Administrator will furnish to the Trustee all information necessary
to carry out such withholding, and, until such information is provided, the
Trustee will refrain from making such distribution.

If no one claims a payment or distribution made from the Trust, the
Trustee will notify the Plan Administrator and will dispose of the payment in
accordance with the subsequent written direction of the Plan Administrator.

13.10      Third
Party

No person dealing with the Trustee will be obliged to see to the proper
application of any money paid or property delivered to the Trustee, or to
inquire whether the Trustee has acted pursuant to any of the terms of the
Plan.  Each person dealing with the
Trustee may act upon any notice, request or representation in writing by the
Trustee, or by the Trustee’s duly authorized agent, and will not be liable to
any person whomsoever in so doing.  The
certification of the Trustee that it is acting in accordance with the Plan will
be conclusive in favor of any person relying on the certification.

13.11      Professional
Agents, Affiliates and Arbitration

(a)          Professional
Agents

The Trustee may employ and pay from the Trust Fund reasonable
compensation to agents, attorneys, accountants and other persons to advise the
Trustee as in its opinion may be necessary. 
The Trustee may delegate to any agent, attorney, accountant or other
person selected by it any non-Trustee power or duty vested in it by the Plan;  the Trustee may act or refrain from acting on
the advice or opinion of any agent, attorney, accountant or other person so
selected.

(b)          Use
of Affiliates

Charles Schwab Trust Company (CSTC) is authorized to contract or make
other arrangements with The Charles Schwab Corporation, Charles Schwab &
Co., Inc., their affiliates and subsidiaries, successors and assigns
(collectively referred to as Schwab), and any other organizations affiliated
with or subsidiaries of CSTC or related entities, for the 

 13-6
 

 

provision of services to the Trust Fund or Plan, except where such
arrangements are prohibited by law or regulation.  As used below, authorized person means any
person whose authorization is required pursuant to the provision of any
prohibited transaction exemption otherwise applicable.

CSTC is authorized to place securities orders, settle securities
trades, hold securities in custody and other related activities on behalf of
the Trust Fund through or by Schwab whenever possible unless the authorized
person specifically instructs the use of another Broker.  Trades and related activities conducted
through the Broker will be subject to fees and commissions established by the
Broker, which may be paid from the Trust Fund or netted from the proceeds of
trades.

Trades will not be executed through Schwab unless the Plan
Administrator and the authorized person have received disclosure concerning the
relationship of Schwab to CSTC, and the fees and commissions which may be paid
to Schwab, CSTC and any affiliate or subsidiary of any of them as a result of
using Schwab to execute trades or for other services.

CSTC is authorized to disclose such information as is necessary to the
operation and administration of the Trust Fund to Schwab and to such other
persons or organizations that CSTC determines have a legitimate business
purpose for obtaining such information.

At the direction of the authorized person, CSTC may purchase shares of
regulated investment companies (or other investment vehicles) advised by Schwab
or CSTC (“Schwab Funds”), except to the extent that such investment is
prohibited by law or regulation.  Schwab
Fund shares may not be purchased for or held by the Trust Fund unless the Plan
Administrator has received disclosure concerning the relationship of Schwab or
CSTC to the Schwab Funds, and any fees which may be paid to such entities.

To the extent permitted under applicable laws, CSTC may invest in
deposits, long and short term debt instruments, stocks and other securities,
including those of CSTC or Schwab.

CSTC and Schwab are authorized to tape record conversations between
CSTC or Schwab and persons acting on behalf of the Plan or a Participant in
order to verify data on transactions.

(c)          Arbitration

Any dispute under this agreement by and between the Trustee and the
Plan Sponsor will be resolved by submission of the issue to a member of the
American Arbitration Association who is chosen by the Plan Sponsor and the
Trustee.  If the Plan Sponsor and the
Trustee cannot agree on such a choice, each will nominate a member of the
American Arbitration Association, and the two nominees will then select an
arbitrator.  Expenses of the arbitration
will be paid as decided by the arbitrator. 
This paragraph will not be interpreted to diminish any rights a
Participant may have under ERISA.

 13-7
 

 

13.12      Valuation
of Trust

The Trustee will value the Trust Fund as of the last day of each Plan
Year to determine the fair market value of the Trust, and the Trustee will
value the Trust Fund on such other date(s) as may be necessary to carry out the
provisions of the Plan.

Notwithstanding any other provision, if the Trustee should determine
that the Trust Fund consists in whole or in part of property not traded freely
on a recognized market, or that information necessary to ascertain the fair
market value is not readily available, the Trustee may request instructions
from the Plan Administrator concerning the value of such property for all
purposes under this Plan and Trust, and the Plan Administrator will comply with
that request.  The Trustee will be
entitled to rely upon the value placed upon such property by the Plan
Administrator.  At the Trustee’s option,
it may request that the Plan Administrator hire an independent appraiser that
meets the requirements of Code Section 401(a)(38)(C) to value the
property.  Alternatively, if the Trustee
chooses or if the Administrator fails or refuses to instruct the Trustee on the
value of such property within a reasonable time after receipt of the Trustee’s
request, the Trustee at its sole discretion may engage an independent appraiser
to determine the fair market value of such property.  Any expenses with respect to such appraisal
will be paid by the Trustee out of the Trust Fund or, at the option of the Plan
Sponsor, by the Plan Sponsor.

13.13      Liability
of Trustee

The Trustee will be liable only for the safeguarding and administration
of the assets of this Trust Fund in accordance with the provisions hereof and
any amendments hereto and no other duties or responsibilities will be
implied.  The Trustee will not be
required to pay any interest on funds paid to or deposited with it or to its
credit under the provisions of this Trust, unless pursuant to a written
agreement between the Plan Sponsor and the Trustee.  The Trustee will not be responsible for the
adequacy of the Trust Fund to meet and discharge any liabilities under the Plan
and will not be required to make any payment of any nature except from funds
actually received as Trustee.

The Trustee may consult with legal counsel (who may be legal counsel
for the Plan Sponsor) selected by the Trustee and the opinion of such counsel,
when relied upon by the Trustee, will be evidence that the Trustee was acting
in good faith.

It will not be the duty of the Trustee to determine the identity or
mailing address of any Participant or any other person entitled to benefits
hereunder, such identity and mailing addresses to be furnished by the Plan
Sponsor, the Plan Administrator or an agent of the Plan Administrator.

The Trustee will be under no liability in making payments in accordance
with the terms of this Plan and the certification of the Plan Administrator or
an agent of the Plan Administrator who has been granted such powers by the Plan
Administrator.

Except to the extent required by any applicable law, no bond or other
security for the faithful performance of duty hereunder will be required of the
Trustee.

 13-8
 

 

13.14      Removal
or Resignation and Successor Trustee

A Trustee may resign at any time upon giving 90 days prior written
notice to the Plan Sponsor or, with the consent of the Plan Sponsor, a Trustee
may resign with less than 90 days prior written notice.

The Plan Sponsor may remove a Trustee by giving at least 60 days prior
written notice to the Trustee.

Upon the removal or resignation of a Trustee, the Plan Sponsor will
appoint and designate a successor Trustee which will be one or more individual
successor Trustees or a corporate Trustee organized under the laws of the
United Sates or of any state thereof with authority to accept and execute
trusts.  Any successor Trustee must
accept and acknowledge in writing its appointment as a successor Trustee before
it can act in such capacity.

Title to all property and records or true copies of such records
necessary to the current operation of the Trust Fund held by the Trustee
hereunder will vest in any successor Trustee acting pursuant to the provisions
hereof, without the execution or filing of any further instrument.  Any resigning or removed Trustee will execute
all instruments and do all acts necessary to vest such title in any successor
Trustee of record.  Each successor
Trustee will have, exercise and enjoy all the powers, both discretionary and
ministerial, herein conferred upon his predecessor.  No successor Trustee will be obligated to
examine the accounts, records and acts of any previous Trustee or Trustees, and
each successor Trustee in no way or manner will be responsible for any action
or omission to act on the part of any previous Trustee.

The resigning or removed trustee may require as a condition of
transferring assets to a successor Trustee that the successor Trustee present
evidence that any bonding requirement under ERISA Section 412 has been met
and/or may require that the Plan Sponsor provide a writing indemnifying the
Trustee against any losses arising from the replacement of the Trustee except to
the extent caused by a breach of fiduciary duty by the removed Trustee.

If either party has given notice of removal or resignation as provided
under this Section 13.14, and upon the expiration of the advance notice period
no other successor Trustee has been appointed and has accepted such
appointment, this provision will serve as (i) notice of appointment of the
Chief Executive Officer of the Plan Sponsor as Trustee and (ii) as acceptance
by that person of that appointment.  The
Trustee is authorized to reserve such sum of money as it may deem advisable for
payment of fees and expenses in connection with the settlement of its accounts
or other proper Trust expenses, and any balance of such reserve remaining after
the payment of such fees and expenses will be paid to the successor Trustee.

Any corporation which results from any merger, consolidation or
purchase to which the Trustee may be a party, or which succeeds to the trust
business of the Trustee, or to which substantially all the trust assets of the
Trustee may be transferred, will be the successor to the Trustee hereunder
without any further act or formality with like effect as if the successor
Trustee had originally been named Trustee herein;  and in any such event it will not be
necessary for the Trustee or any successor Trustee to give notice thereof to
any person, and any requirement, statutory or otherwise, that notice will be
given is hereby waived.

 13-9
 

 

13.15      Appointment
of Investment Manager

One or more Investment Managers, within the meaning of Section 3(38) of
ERISA, may be appointed by the Plan Sponsor (or the Plan Administrator) to
exercise full investment management authority with respect to all or a portion
of the Trust assets, as provided in Sections 3(38) and 403(a)(2) of ERISA.  Authorized payment of the fees and expenses
of the Investment Manager(s) may be made from the Trust assets.  For purposes of this agreement, any
Investment Manager so appointed will, during the period of his appointment,
possess fully and absolutely those powers, rights and duties of the Trustee (to
the extent delegated in writing by the Plan Sponsor or the Plan Administrator)
with respect to the investment or reinvestment of that portion of the Trust
assets over which the Investment Manager has investment management authority.  The Investment Manager must be one of the
following:

(a)          Registered
as an investment advisor under the Investment Advisors Act of 1940;

(b)         A bank, as
defined in the Investment Advisors Act of 1940; 
or

(c)          An
insurance company qualified to manage, acquire, or dispose of such Plan assets
under the laws of more than one state.

Any Investment Manager will acknowledge in writing to the Plan Sponsor
or the Plan Administrator and to the Trustee that he or it is a fiduciary with
respect to the Plan.  During any period
of time when the Investment Manager is so appointed and serving, and with
respect to those assets in the Plan over which the Investment Manager exercises
investment management authority, the Trustee’s responsibility will be limited
to holding such assets as a custodian, providing accounting services,
disbursing benefits as authorized, and executing such investment instructions
only as directed by the Investment Manager. 
The Trustee will not be responsible for any acts or omissions of the Investment
Manager.  Any certificates or other
instruments duly signed by the Investment Manager (or the authorized
representative of the Investment Manager), purporting to evidence any
instruction, direction or order of the Investment Manager with respect to the
investment of those assets of the Plan over which the Investment Manager has
investment management authority, will be accepted by the Trustee as conclusive
proof thereof.  The Trustee will also be
fully protected in acting in good faith upon any notice, instruction,
direction, order, certificate, opinion, letter, telegram or other document
believed by the Trustee to be genuine and from the Investment Manager (or the
authorized representative of the Investment Manager).  The Trustee will not be liable for any action
taken or omitted by the Investment Manager or for any mistakes of judgment or
other action made, taken or omitted by the Trustee in good faith upon direction
of the Investment Manager.

13.16      Termination
of Trust

In the event that this Plan is terminated by the Plan Sponsor, the
Trust Fund will be distributed by the Trustee as and when directed by the Plan
Administrator in accordance with the provisions of the Plan and Trust.  From the date of termination of the Plan and
until the final distribution of the Trust assets, the Trustee will continue to
have all the powers provided under this Section that are necessary or desirable
for the orderly liquidation and distribution of the Trust Fund.

 13-10
 

 

The Trustee may condition the transfer or distribution of any assets of
the Trust Fund upon termination of the Plan on receipt of a favorable
determination letter from the Internal Revenue Service confirming that the
termination of the Plan does not adversely affect the tax-exempt status of the
Trust Fund.  Alternatively, the Trustee,
in its sole discretion, may accept the indemnification of the Trustee, that is
provided by the Plan Sponsor, against any liability arising from such transfer
or distribution, or may require the Plan Sponsor to post a bond sufficient to
protect the Trustee against such liability until such time as a favorable
determination letter is received.

13.17      Governing
Law

The Trust will be administered in the State of California, and its
validity, construction, and all rights hereunder will be governed by ERISA and,
to the extent not preempted, by the laws of California.  If any provisions of this Trust will be
invalid or unenforceable, the remaining provisions will continue to be fully
effective.

13.18      Proxy
Voting

In no event will the Trustee be responsible for the voting or tendering
of shares of securities held in the Trust or for ascertaining or monitoring
whether, or how, proxies are voted or whether the proper number of proxies is
received.  The Trustee will deliver to
the Plan Administrator, or the person or persons identified by the Plan
Administrator, proxies and powers of attorney and related informational
material, for any shares or other property held.  Subject to the provisions of this paragraph,
the Plan Administrator will have responsibility for instructing the Trustee as
to voting such shares and the tendering of such shares, by proxy or in person,
except to the extent such responsibility is delegated to another person, under
the terms of the Plan and Trust Agreement or under an agreement between the
named fiduciary of the Plan and an investment manager, in which case such
persons will have such responsibility. 
The Trustee may use agents to effect such delivery to the Plan
Administrator or the person or persons identified by the Plan Administrator.

13.18      Employer
Stock

(a)          Type
of Employer Stock

The Trustee will, to the extent practical based on the Participant’s
election, invest that portion of the Trust fund so elected by a Participant, in
common stock of the Employer or any Participating Employer (Employer Stock)
which includes treasury stock which has been purchased by the Employer.  The percentage of Plan assets invested in
such Employer Stock will be such an amount as directed by Participants, which
may exceed 10% of the Plan’s assets.

(b)          Voting
Rights

Voting rights with respect to shares of Employer Stock held in the
Trust Fund will be voted by the Trustee in such manner as may be determined by
the respective Participants, with respect to all matters requiring shareholder approval.

 13-11
 

 

The Trustee and the Employer will adopt reasonable measures to enable
the Employer to notify the Participants of the date and purpose of each meeting
of stockholders of the Employer at which holders of shares of Employer Stock
will be entitled to vote, and to request instructions from each Participant to
the Trustee as to the voting at such meeting of full shares of Employer Stock
(whether or not vested) in the Accounts of such Participant.  The Trustee, itself or by proxy, will vote
full shares of Employer Stock in accordance with the instructions of the
Participant.  If prior to the time of
such meeting of stockholders (or a date prior thereto specified by the Trustee)
the Trustee will not have received instructions from any Participant, the Trustee
will have no duty to make any decision or take any action regarding any such
stock unless otherwise instructed by the named fiduciary.

(c)          Tender
Offers

Each Participant, or, in the event of his death, his Beneficiary, will
have the right, to the extent of the number of full shares of Employer Stock in
his account, to direct the Trustee in writing as to the manner in which to
respond to a tender or exchange offer with respect to shares of such Employer
Stock.

The Employer will utilize its best efforts to timely distribute or
cause to be distributed to each Participant (or Beneficiary) such information
as will be distributed to shareholders of the Employer in connection with any
such tender or exchange offer.

The Trustee will, with respect to Employer Stock held in the Trust
Fund, accept or reject the terms of any tender offer and, accordingly, tender
Employer Stock held by the Trustee in the Trust Fund in accordance with the
terms and provisions of any tender offer, or not tender such Employer Stock, as
directed by the respective Participants. 
With respect to full shares of Employer Stock which are allocated to
Participants who have not given directions, the Trustee will not tender any
shares of Employer Stock with respect to which such Participants (or Beneficiaries)
have the right of direction.

The sum of fractional shares allocated to Participants’ Accounts and
unallocated shares of Employer Stock will be tendered or exchanged in the same
manner and proportion as shares with respect to which Participants have the
right of direction are tendered or exchanged.

The Plan Administrator may establish such rules and guidelines as it
deems appropriate to properly effect the provisions of this Section.

13.19      Trustee
Indemnification

To the extent permitted under applicable law, the Employer shall
indemnify and hold harmless the Trustee, its officers, employees, and agents
from and against all liabilities, losses, expenses, and claims (including
reasonable attorney’s fees and costs of defense) arising out of (1) the acts or
omissions to act with respect to the Plan or Trust by persons unrelated to the
Trustee (“unrelated persons”), (2) the Trustee’s action or inaction with
respect to the Plan or Trust resulting from reasonable reliance on the action
or inaction of unrelated persons, including directions to invest or otherwise
deal with Plan assets, or (3) any violation by any unrelated person of the
provisions of applicable law or any regulations promulgated 

 13-12
 

 

thereunder or other applicable standards of fiduciary conduct, unless
the Trustee commits a breach of its duties by reason of its negligence or
willful misconduct.  Expenses incurred by
the Trustee which it believes to be subject to indemnification under this
Agreement shall be paid by the Employer upon the Trustee’s request, provided
that the Employer may delay payment of any amount in dispute until such dispute
is resolved according to the provisions of the Plan or any Separate Trust
Agreement. Such resolution may include the award of interest on unpaid amounts
determined to be payable to the Trustee under this Section.

 13-13

 

APPENDIX

Schedule of Employers for whom prior service credit
has been granted by the Plan Sponsor for purposes of calculating Years of
Vesting Service and Years of Eligibility Service pursuant to Section 1.30.

None.

Schedule of entities
designated by the Plan Sponsor as Allocation Units for purposes of the
allocation of contributions to Participants pursuant to Article 3.

None.

Schedule of qualified
plans for which asset transfers are authorized by the Plan Sponsor pursuant to
Section 8.06 on behalf of Participants who transfer employment between the Plan
Sponsor or a Participating Employer in this Plan and employers whose qualified
plans are listed below.

None.

Schedule of Elections to
limit Highly Compensated Employees for a particular Lookback Year to those who
were in the Top-paid Group for such Lookback Year as defined in Section
11.01(d)(2) and 11.01(j).

	
  A.

  	
  1997 PLAN YEAR

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.

  	
  TOP PAID GROUP ELECTION

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  CALENDAR YEAR ELECTION

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B.

  	
  1998 PLAN YEAR

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.

  	
  TOP PAID GROUP ELECTION

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  CALENDAR YEAR ELECTION

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C.

  	
  1999 PLAN YEAR

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.

  	
  TOP PAID GROUP ELECTION

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  CALENDAR YEAR ELECTION

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  D.

  	
  2000 PLAN YEAR

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.

  	
  TOP PAID GROUP ELECTION

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  CALENDAR YEAR ELECTION

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  E.

  	
  2001 PLAN YEAR

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.

  	
  TOP PAID GROUP ELECTION

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  CALENDAR YEAR ELECTION

  	
  YES

  	
  o

  	
  NO

  	
  x

  

 

 

Schedule of Elections to compare the Contribution Percentage and
Deferral Percentage for the Highly Compensated Group for a Plan Year with the
Contribution Percentage and Deferral Percentage respectively for the Non-highly
Compensated Group for the preceding Plan Year in accordance with regulations
issued by the Secretary of the Treasury and pursuant to Sections 11.02(b)(5)
and 11.02(b)(7).

 

	
  A.

  	
  1997 PLAN YEAR

  
	
   

  	
   

  
	
   

  	
  1.

  	
  INITIAL YEAR

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
  LOOKBACK YEAR 3%

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  b.

  	
  ACTUAL DEFERRALS

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  PRIOR YEAR TESTING

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.

  	
  CURRENT YEAR TESTING

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  B.

  	
  1998 PLAN YEAR

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.

  	
  INITIAL YEAR

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
  LOOKBACK YEAR 3%

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  b.

  	
  ACTUAL DEFERRALS

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  PRIOR YEAR TESTING

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.

  	
  CURRENT YEAR TESTING

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  C.

  	
  1999 PLAN YEAR AND AFTER

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  1.

  	
  INITIAL YEAR

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  a.

  	
  LOOKBACK YEAR 3%

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  b.

  	
  ACTUAL DEFERRALS

  	
  YES

  	
  x

  	
  NO

  	
  o

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  PRIOR YEAR TESTING

  	
  YES

  	
  o

  	
  NO

  	
  x

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.

  	
  CURRENT YEAR TESTING

  	
  YES

  	
  x

  	
  NO

  	
  o

  

 

 

IN WITNESS WHEREOF, this
instrument has been executed by the duly authorized and empowered officers of
the Plan Sponsor, this                 
day of                                           ,
              .

	
  

  	
  THOMAS GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  

The Trustee agrees to serve as Trustee under the terms
of this instrument.

	
   

  	
  THE CHARLES SCHWAB TRUST COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}]]