Document:

Exhibit

Exhibit 4.3

THE SOUTHERN COMPANY 
 
 
EMPLOYEE SAVINGS PLAN 
 
 
As Amended and Restated 
 
Effective January 1, 2018

TABLE OF CONTENTS

	
					
	 
	 
	 
	 
	Page

	ARTICLE I
	PURPOSE
	1

	ARTICLE II
	DEFINITIONS
	2

	ARTICLE III
	PARTICIPATION
	12

	 
	3.1
	Eligibility Requirements
	12

	 
	3.2
	Participation upon Reemployment
	12

	 
	3.3
	No Restoration of Previously Distributed Benefits
	12

	 
	3.4
	Loss of Eligible Employee Status
	13

	 
	3.5
	Military Leave
	13

	 
	3.6
	Elizabethtown Gas Company Union Employees
	13

	ARTICLE IV
	ELECTIVE EMPLOYER CONTRIBUTIONS, ROTH CONTRIBUTIONS, AND VOLUNTARY PARTICIPANT CONTRIBUTIONS
	15

	 
	4.1
	Elective Employer Contributions and/or Roth Contributions
	15

	 
	4.2
	Maximum Amount of Elective Employer Contributions and/or Roth Contributions
	15

	 
	4.3
	Distribution of Excess Deferral Amounts
	15

	 
	4.4
	Additional Rules Regarding Elective Employer Contributions and/or Roth Contributions
	16

	 
	4.5
	Section 401(k) Nondiscrimination Tests
	17

	 
	4.6
	Voluntary Participant Contributions
	20

	 
	4.7
	Manner and Time of Payment of Elective Employer Contributions, Roth Contributions, and Voluntary Participant Contributions
	20

	 
	4.8
	Change in Contribution Rate
	20

	 
	4.9
	Change in Contribution Amount
	21

	 
	4.10
	Rollovers from Other Plans
	21

	 
	4.11
	Catch-up Contributions
	21

	
			
	 
	-i-
	 

TABLE OF CONTENTS
(continued)

	
					
	 
	 
	 
	 
	Page

	ARTICLE V
	EMPLOYER MATCHING CONTRIBUTIONS
	22

	 
	5.1
	Amount of Employer Matching Contributions
	22

	 
	5.2
	Payment of Employer Matching Contributions
	22

	 
	5.3
	Limitations on Employer Matching Contributions and Voluntary Participant Contributions
	22

	 
	5.4
	Reversion of Employing Company Contributions
	24

	 
	5.5
	Correction of Prior Incorrect Allocations and Distributions
	25

	ARTICLE VI
	LIMITATIONS ON CONTRIBUTIONS
	26

	 
	6.1
	Section 415 Limitations
	26

	 
	6.2
	Combination of Plans
	26

	ARTICLE VII
	SUSPENSION OF CONTRIBUTIONS
	27

	 
	7.1
	Suspension of Contributions
	27

	 
	7.2
	Resumption of Contributions
	27

	ARTICLE VIII
	INVESTMENT OF CONTRIBUTIONS
	28

	 
	8.1
	Investment Funds
	28

	 
	8.2
	Investment of Contributions
	28

	 
	8.3
	Investment of Earnings
	28

	 
	8.4
	Transfer of Assets between Funds
	28

	 
	8.5
	Change in Investment Direction
	28

	 
	8.6
	Section 404(c) Plan
	28

	 
	8.7
	Suspension, Discontinuance, or Restriction of Trading
	29

	 
	8.8
	Designated Net Litigation Distributions
	29

	 
	8.9
	Diversification Requirements
	29

	
			
	 
	ii
	 

TABLE OF CONTENTS
(continued)

	
					
	 
	 
	 
	 
	Page

	ARTICLE IX
	MAINTENANCE AND VALUATION OF PARTICIPANTS’ ACCOUNTS
	31

	 
	9.1
	Establishment of Accounts
	31

	 
	9.2
	Valuation of Investment Funds
	32

	 
	9.3
	Rights in Investment Funds
	32

	ARTICLE X
	VESTING
	33

	 
	10.1
	Vesting
	33

	ARTICLE XI
	WITHDRAWALS AND LOANS
	34

	 
	11.1
	Withdrawals by Participants
	34

	 
	11.2
	Notice of Withdrawal
	35

	 
	11.3
	Form of Withdrawal
	35

	 
	11.4
	Source of Withdrawal
	36

	 
	11.5
	Requirement of Hardship
	36

	 
	11.6
	Loans to Participants
	38

	ARTICLE XII
	DISTRIBUTION TO PARTICIPANTS
	40

	 
	12.1
	Distribution upon Termination of Employment
	40

	 
	12.2
	Distribution upon Disability
	41

	 
	12.3
	Distribution upon Death
	41

	 
	12.4
	Designation of Beneficiary in the Event of Death
	41

	 
	12.5
	Required Minimum Distributions
	42

	 
	12.6
	Transfer between Employing Companies
	48

	 
	12.7
	Distributions to Alternate Payees
	48

	 
	12.8
	Requirement for Direct Rollovers
	48

	 
	12.9
	Consent and Notice Requirements
	49

	
			
	 
	iii
	 

TABLE OF CONTENTS
(continued)

	
					
	 
	 
	 
	 
	Page

	 
	12.10
	Form of Payment
	49

	 
	12.11
	[Reserved]
	49

	 
	12.12
	Distribution of Dividends Payable on Common Stock
	49

	ARTICLE XIII
	ADMINISTRATION OF THE PLAN
	51

	 
	13.1
	Membership of Administrative Committee
	51

	 
	13.2
	Term
	 
	51

	 
	13.3
	Transaction of Business
	51

	 
	13.4
	Administrative Committee Responsibilities in General
	51

	 
	13.5
	Administrative Committee and Pension Fund Investment Review Committee as Named Fiduciaries
	51

	 
	13.6
	Rules for Plan Administration
	52

	 
	13.7
	Employment of Agents
	52

	 
	13.8
	Co-Fiduciaries
	52

	 
	13.9
	General Records
	52

	 
	13.10
	Liability of the Administrative Committee
	53

	 
	13.11
	Reimbursement of Expenses and Compensation of Administrative Committee
	53

	 
	13.12
	Expenses of Plan and Trust Fund
	53

	 
	13.13
	Responsibility for Funding Policy
	53

	 
	13.14
	Management of Assets
	54

	 
	13.15
	Notice and Claims Procedures
	54

	 
	13.16
	Bonding
	54

	 
	13.17
	Multiple Fiduciary Capacities
	54

	ARTICLE XIV
	TRUSTEE OF THE PLAN
	56

	
			
	 
	iv
	 

TABLE OF CONTENTS
(continued)

	
					
	 
	 
	 
	 
	Page

	 
	14.1
	Trustee
	56

	 
	14.2
	Purchase of Common Stock
	56

	 
	14.3
	Voting of Common Stock
	56

	 
	14.4
	Voting of Other Investment Fund Shares
	57

	 
	14.5
	Uninvested Amounts
	57

	 
	14.6
	Independent Accounting
	57

	ARTICLE XV
	AMENDMENT AND TERMINATION OF THE PLAN
	58

	 
	15.1
	Amendment of the Plan
	58

	 
	15.2
	Termination of the Plan
	58

	 
	15.3
	Merger or Consolidation of the Plan
	58

	ARTICLE XVI
	TOP HEAVY REQUIREMENTS
	60

	 
	16.1
	Top-Heavy Plan Requirement
	60

	 
	16.2
	Determination of Top-Heavy Status
	60

	 
	16.3
	Minimum Allocation for Top-Heavy Plan Years
	60

	ARTICLE XVII
	GENERAL PROVISIONS
	62

	 
	17.1
	Plan Not an Employment Contract
	62

	 
	17.2
	No Right of Assignment or Alienation
	62

	 
	17.3
	Payment to Minors and Others
	62

	 
	17.4
	Source of Benefits
	63

	 
	17.5
	Unclaimed Benefits
	63

	 
	17.6
	Governing Law
	63

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	APPENDIX A – EMPLOYING COMPANIES
	 

	APPENDIX B – ETG Union Participants
	 

	
			
	 
	v
	 

THE SOUTHERN COMPANY 
 
 
EMPLOYEE SAVINGS PLAN 
 
 
As Amended and Restated 
 
Effective January 1, 2018

ARTICLE I
PURPOSE
The purpose of the Plan is to encourage employee thrift, to supplement retirement and death benefits, and to create a competitive compensation program for employees through the establishment of a formal plan under which contributions by and on behalf of Participants are supplemented by contributions of Employing Companies.  This Plan is intended to be a stock bonus plan, and all contributions made by an Employing Company to this Plan are expressly conditioned upon the deductibility of such contributions under Code Section 404.  In addition, the Company Stock Fund under the Plan is also intended to be an employee stock ownership plan, as defined in Code Section 4975(e)(7) and ERISA Section 407(d)(6).  The Plan was originally effective March 1, 1976.  The Plan was amended and restated effective as of December 20, 2006 to provide for the merger of The Southern Company Employee Stock Ownership Plan into the Plan, as well as to incorporate a variety of plan design and other changes.  The Plan was amended and restated effective as of January 1, 2009 in connection with submitting an application to the Internal Revenue Service for a favorable determination letter and to amend the Plan to  clarify the requirement of providing notice to Employing Companies of changes in Employer Matching Contributions and again effective January 1, 2010 to incorporate previous amendments, to establish the Roth Contributions feature of the Plan, to make certain technical amendments to comply with legal requirements, and to delete Plan provisions which are no longer required to be stated because they have become obsolete or are no longer necessary to protect a prior plan feature.  This Plan amendment and restatement effective January 1, 2018 is made to incorporate previous amendments and to provide for the merger of the AGL Resources Inc. Retirement Savings Plus Plan and the Nicor Gas Thrift Plan into the Plan, as well as to incorporate a variety of plan design and other changes.

ARTICLE II 
 
DEFINITIONS
All references to articles, sections, subsections, and paragraphs shall be to articles, sections, subsections, and paragraphs of this Plan unless another reference is expressly set forth in this Plan.  Any words used in the masculine shall be read and be construed in the feminine where they would so apply.  Words in the singular shall be read and construed in the plural, and all words in the plural shall be read and construed in the singular in all cases where they would so apply.
For purposes of this Plan, unless otherwise required by the context, the following terms shall have the meanings set forth opposite such terms:
2.1    “Account” shall mean the total amount credited to the account of a Participant, as described in Section 9.1.
2.2    “Actual Contribution Percentage Test” shall mean the test described in Section 5.3(a).
2.3    “Actual Deferral Percentage” shall mean the ratio (expressed as a percentage) of Elective Employer Contributions and/or Roth Contributions of an Eligible Participant for the Plan Year to the Eligible Participant’s compensation for the Plan Year.  For the purpose of determining an Eligible Participant’s Actual Deferral Percentage for a Plan Year, the Administrative Committee may elect to consider an Eligible Participant’s compensation for (a) the entire Plan Year or (b) that portion of the Plan Year in which the Eligible Participant was eligible to make Elective Employer Contributions and/or Roth Contributions, provided that such election is applied uniformly to all Eligible Participants for the Plan Year.  For purposes of this Section 2.3, “compensation” shall mean actual compensation for services rendered or paid by the employer to an Eligible Participant which is currently includible in the Eligible Participant’s gross income, as reported on the Eligible Participant’s Federal Income Tax Withholding Statement (Form W‐2), plus (i) an Eligible Participant’s elective deferrals under Code Sections 402(g)(3) and 414(v), (ii) amounts contributed or deferred under Code Section 125 by the employer at the Eligible Participant’s election that are not includible in the Eligible Participant’s gross income, and (iii) amounts which are not includible in an Eligible Participant’s gross income by reason of Code Sections 132(f)(4) or 457.  Compensation also shall be limited pursuant to Code Section 401(a)(17).  The Actual Deferral Percentage of an Eligible Participant who does not have Elective Employer Contributions and/or Roth Contributions shall be zero.
2.4    “Actual Deferral Percentage Test” shall mean the test described in Section 4.5(a).
2.5    “Administrative Committee” shall mean the administrative committee appointed pursuant to Section 13.1 to serve as plan administrator.  Its formal title is the Southern Company Employee Savings Plan Committee.
2.6    “Affiliated Employer” shall mean an Employing Company and (a) any corporation which is a member of a controlled group of corporations (as defined in Code Section 414(b)) which includes such Employing Company, (b) any trade or business (whether or not 

2

incorporated) which is under common control (as defined in Code Section 414(c)) with such Employing Company, (c) any organization (whether or not incorporated) which is a member of an affiliated service group (as defined in Code Section 414(m)) which includes such Employing Company, and (d) any other entity required to be aggregated with such Employing Company pursuant to regulations under Code Section 414(o).  Notwithstanding the foregoing, for purposes of applying the limitations of Article VI, the term Affiliated Employer shall be adjusted as required by Code Section 415(h).
2.7    “Aggregate Account” shall mean with respect to a Participant as of the Determination Date, the sum of the following:
(a)    the Account balance of such Participant as of the most recent valuation occurring within a twelve-month period ending on the Determination Date;
(b)    an adjustment for any contributions due as of the Determination Date;
(c)    any Plan distributions, including unrelated rollovers and plan-to-plan transfers (ones which are both initiated by the Employee and made from a plan maintained by one employer to a plan maintained by another employer), but not related rollovers or plan-to-plan transfers (ones either not initiated by the Employee or made to a plan maintained by the same employer), made within the one-year period ending on the Determination Date.  The preceding sentence shall also apply to distributions under a terminated plan which if it had not been terminated would have been required to be included in an Aggregation Group.  In the case of a distribution made for a reason other than severance from employment (or separation from service), death or disability, this provision shall be applied by substituting “five-year period” for “one-year period”;
(d)    any Employee contributions, whether voluntary or mandatory;
(e)    unrelated rollovers and plan-to-plan transfers to this Plan accepted prior to January 1, 1984; and
(f)    related rollovers and plan-to-plan transfers to this Plan.
2.8    “Aggregation Group” shall mean either a Required Aggregation Group or a Permissive Aggregation Group.
2.9    “AGL RSP Plan” shall mean the AGL Resources Inc. Retirement Savings Plus Plan.
2.10    “Annual Addition” shall mean the amount allocated to a Participant’s Account and accounts under all defined contribution plans maintained by the Affiliated Employers during a Limitation Year that constitutes
(a)    Affiliated Employer contributions,
(b)    Voluntary Participant Contributions,

3

(c)    Roth Contributions,
(d)    forfeitures, if any, allocated to a Participant’s Account or accounts under all defined contribution plans maintained by the Affiliated Employers, and
(e)    amounts described in Code Sections 415(l)(1) and 419A(d)(2).
2.11    “Average Actual Deferral Percentage” shall mean the average (expressed as a percentage) of the Actual Deferral Percentages of the Eligible Participants in a group.
2.12    “Average Contribution Percentage” shall mean the average (expressed as a percentage) of the Contribution Percentages of the Eligible Participants in a group.
2.13    “Beneficiary” shall mean any person(s) who, or estate(s), trust(s), or organization(s) which, in accordance with the provisions of Section 12.4, become entitled to receive benefits upon the death of a Participant.
2.14    “Board of Directors” shall mean the Board of Directors of Southern Company Services, Inc.
2.15    “Break-in-Service Date” means the earlier of:
(a)    the date on which an Employee terminates employment, is discharged, retires, or dies; or
(b)    the last day of an approved leave of absence including any extension.
In the case of an individual who is absent from work for maternity or paternity reasons, such individual shall not incur a Break-in-Service Date earlier than the expiration of the second anniversary of the first date of such absence; provided, however, that the twelve-consecutive-month period beginning on the first anniversary of the first date of such absence shall not constitute a Year of Service.  For purposes of this paragraph, an absence from work for maternity or paternity reasons means an absence (a) by reason of the pregnancy of the Employee, (b) by reason of a birth of a child of the Employee, (c) by reason of the placement of a child with the Employee in connection with the adoption of such child by such Employee, or (d) for purposes of caring for such child for a period beginning immediately following such birth or placement.
2.16    “Catch-up Contributions” shall mean contributions made pursuant to Section 4.11 during the Plan Year by an Employing Company, at the election of the Participant, in lieu of cash compensation and shall include contributions made pursuant to a salary reduction agreement.
2.17    “Catch-up Roth Contributions” shall mean contributions made pursuant to Section 4.11 during the Plan Year, at the election of the Participant, in lieu of all or a portion of the Catch-up Contributions that a Participant is otherwise entitled to make to the Plan and which is treated by the Participant as includible in the Participant’s gross income pursuant to Code Section 402A at the time the Participant would have received the amount in cash if the Participant had not made such an election.

4

2.18    “Code” shall mean the Internal Revenue Code of 1986, as amended, or any successor statute, and the rulings and regulations promulgated thereunder.  In the event an amendment to the Code renumbers a section of the Code referred to in this Plan, any such reference automatically shall become a reference to such section as renumbered.
2.19    “Common Stock” shall mean the common stock of The Southern Company, which is readily tradable on the New York Stock Exchange.
2.20    “Company” shall mean Southern Company Services, Inc., and its successors.
2.21    “Company Stock Fund” shall mean the fund under the Plan invested in Common Stock as described in Section 8.1.
2.22    “Compensation” shall mean the salary or wages of a Participant, including annual incentive bonuses, but only to the extent such bonuses are based on base wages and not overtime pay, all amounts contributed by an Employing Company to The Southern Company Flexible Benefits Plan on behalf of a Participant pursuant to a salary reduction arrangement under such plan, plus monthly shift and monthly seven-day schedule differentials, geographic premiums, monthly customer service premiums, monthly nuclear plant premiums, sales commissions paid under a sales commission payment program sponsored by an Employing Company for sales commissioned based employees, military differential pay, and overtime pay resulting from fluctuations in a Participant’s weekly hours worked pursuant to a pre-determined flexible work schedule established or approved by an Employing Company that is intended to produce, on average, forty (40) hour work weeks, and before deduction of taxes, social security, etc., but excluding all awards under any long term incentive pay plans sponsored by the Employing Company, overtime pay (except as specifically included above), any hourly shift differentials, substitution pay, such amounts which are reimbursements to a Participant paid by any Employing Company, including but not limited to, reimbursement for such items as moving expenses and travel and entertainment expenses, and imputed income for automobile expenses, tax preparation expenses and health and life insurance premiums paid by the Employing Company.  Pursuant to Section 4.1, the annual incentive bonus may only be contributed by making a separate election pursuant to Section 5.1 and may not be considered for purposes of the Employer Matching Contribution.
The Compensation of each Participant taken into account for purposes of this Plan shall not exceed the applicable limit under Code Section 401(a)(17).
2.23    “Contribution Percentage” shall mean the ratio (expressed as a percentage), of the sum of the Voluntary Participant Contributions and Employer Matching Contributions under the Plan of the Eligible Participant for the Plan Year to the Eligible Participant’s compensation for the Plan Year.  For the purpose of determining an Eligible Participant’s Contribution Percentage for a Plan Year, the Administrative Committee may elect to consider an Eligible Participant’s compensation for (a) the entire Plan Year or (b) that portion of the Plan Year in which the individual is an Eligible Participant, provided that such election is applied uniformly to all Eligible Participants for the Plan Year.  For purposes of this Section 2.23, “compensation” shall mean actual compensation for services rendered or paid by the employer to an Eligible Participant which is currently includible in the Eligible Participant’s gross income, as reported on 

5

the Eligible Participant’s Federal Income Tax Withholding Statement (Form W‐2), plus (i) an Eligible Participant’s elective deferrals under Code Sections 402(g)(3) and 414(v), (ii) amounts contributed or deferred under Code Section 125 by the employer at the Eligible Participant’s election that are not includable in the Eligible Participant’s gross income, and (iii) amounts which are not includable in an Eligible Participant’s gross income by reason of Code Sections 132(f)(4) or 457.  Compensation also shall be limited pursuant to Code Section 401(a)(17).  The Contribution Percentage of an Eligible Participant who does not make Voluntary Participant Contributions or have Employer Matching Contributions shall be zero.
2.24    “Determination Date” shall mean with respect to a Plan Year, the last day of the preceding Plan Year.
2.25    “Determination Year” shall mean the Plan Year being tested.
2.26    “Disability” shall mean a finding of eligibility for disability benefits by the Social Security Administration or by the claims fiduciary of the Long-Term Disability Program under the Southern Company Services, Inc. Health and Welfare Benefits Plan as determined in accordance with that Plan’s terms and in either case evidenced in a writing provided to the Administrative Committee by the Participant.
2.27    “Direct Rollover” shall mean a payment by the Plan to the Eligible Retirement Plan specified by the Distributee.
2.28    “Distributee” shall include an Employee or former Employee.  In addition, Distributee shall include the Employee’s or former Employee’s surviving spouse, the Employee’s or former Employee’s spouse or former spouse who is an alternate payee under a qualified domestic relations order (as defined in Code Section 414(p)), and, for Plan Years beginning on or after January 1, 2007, the Employee’s or former Employee’s Beneficiary or Beneficiaries.
2.29    “Elective Employer Contribution” shall mean contributions made pursuant to Section 4.1 during the Plan Year on behalf of a Participant by an Employing Company, at the election of the Participant, in lieu of cash compensation and shall include contributions made pursuant to a salary reduction agreement.
2.30    “Eligible Employee” shall mean an Employee who is employed by an Employing Company and (a) who was eligible to be included in the Plan on January 1, 1991, or (b) who is a regular full-time or regular part-time employee, and excluding:
(1)    an individual who is classified by an Employing Company as a leased employee, regardless of whether such classification is determined to be in error;
(2)    any Union Employee unless the representatives of his bargaining unit and the Employing Company mutually agree to participation in the Plan subject to its terms by members of his bargaining unit;
(3)    an individual who is a cooperative education employee; and

6

(4)    an individual who is classified by the Employing Company as a temporary employee (who was not eligible to be included in the Plan on January 1, 1991) or an independent contractor, regardless of whether such classification is determined to be in error.  Effective September 1, 1998, any individual classified by the Employing Company as a temporary employee shall be excluded from the Plan, regardless of any prior inclusion in the Plan and regardless of whether the “temporary employee” classification is determined to be in error.
2.31    “Eligible Participant” shall mean an Eligible Employee who is authorized to have Elective Employer Contributions, Roth Contributions, and/or Voluntary Participant Contributions allocated to his Account for the Plan Year.
2.32    “Eligible Retirement Plan” shall mean an individual retirement account described in Code Section 408(a), an individual retirement annuity described in Code Section 408(b), an annuity plan described in Code Section 403(a), a plan described in Code Section 403(b), a plan described in Code Section 457(b) which is maintained by a state, an 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, a qualified trust described in Code Section 401(a) that accepts the Distributee’s Eligible Rollover Distribution, or, effective as of January 1, 2008, a Roth IRA described in Code Section 408A.
2.33    “Eligible Rollover Distribution” shall mean 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:  (a) 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, the joint lives (or joint life expectancies) of the Distributee and the Distributee’s Beneficiary, or for a specified period of 10 years or more; (b) any distribution to the extent such distribution is required under Code Section 401(a)(9); (c) any hardship distribution described in Code Section 401(k)(2)(B)(i)(IV); and (d) for Plan Years prior to January 1, 2008, the portion of any distribution from a designated Roth account as defined in Code Section 402A.
2.34    “Employee” shall mean each individual who is employed by an Affiliated Employer under common law and each individual who is required to be treated as an employee pursuant to the “leased employee” rules of Code Section 414(n) other than a leased employee described in Code Section 414(n)(5).
2.35    “Employee Stock Ownership Plan” shall mean The Southern Company Employee Stock Ownership Plan, as such plan existed prior to December 20, 2006.
2.36    “Employer Matching Contribution” shall mean a contribution attributable to each Participant made by an Employing Company pursuant to Section 5.1 with respect to Elective Employer Contributions, Roth Contributions, and Voluntary Participant Contributions each payroll period.  Employer Matching Contributions shall not be made on Catch-Up Contributions or Catch-Up Roth Contributions.
2.37    “Employing Company” shall mean the Company and any affiliate or subsidiary of The Southern Company which the Board of Directors may from time to time determine to bring 

7

under the Plan and which shall adopt the Plan, and any successor of them.  The Employing Companies are set forth on Appendix A to the Plan as updated from time to time.  No such entity shall be treated as an Employing Company prior to the date it adopts the Plan.
2.38    “Enrollment Date” shall mean the first day of each payroll period.
2.39    “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended, or any successor statute, and the rulings and regulations promulgated thereunder.  In the event an amendment to ERISA renumbers a section of ERISA referred to in this Plan, any such reference automatically shall become a reference to such section as renumbered.
2.40    “Excess Aggregate Contributions” shall mean the amount referred to in Code Section 401(m)(6)(B) with respect to a Participant.  In no event may the Excess Aggregate Contributions for any Highly Compensated Employee exceed the amount of the Employer Matching Contributions and/or Voluntary Participant Contributions of the Highly Compensated Employee for the Plan Year.
2.41    “Excess Deferral Amount” shall mean the amount of Elective Employer Contributions and/or Roth Contributions for a calendar year that exceed the Code Section 402(g) limits as allocated to this Plan pursuant to Section 4.3(b).
2.42    “Excess Deferral Contributions” shall mean the amount of Elective Employer Contributions and/or Roth Contributions of a Highly Compensated Employee referred to in Code Section 401(k)(8)(B).
2.43    “Highly Compensated Employee” shall mean (in accordance with and subject to Code Section 414(q) and any regulations, rulings, notices or procedures thereunder), with respect to any Plan Year:  (1) any Employee who was a five percent (5%) owner of The Southern Company or an Affiliated Employer (as determined pursuant to Code Section 416) during the Plan Year or the immediately preceding Plan Year, or (2) any Employee who had compensation in excess of $110,000 in the preceding Plan Year.  The $110,000 amount shall be adjusted for inflation and for short Plan Years, pursuant to Code Section 414(q).  The Employer may, at its election, limit Employees who had compensation in excess of $110,000 to only those Employees who fall within the “top-paid group,” as defined in Code Section 414(q) excluding those employees described in Code Section 414(q)(8) for such purpose.  In determining whether an Employee is a Highly Compensated Employee, the Administrative Committee may make any elections authorized under applicable regulations, rulings, notices, or revenue procedures.  For purposes of this Section 2.42, “compensation” shall mean compensation within the meaning of Code Section 415(c)(3).
2.44    “Hour of Service” shall mean each hour for which an Employee is paid, or entitled to payment, for the performance of duties for an Affiliated Employer.
2.45    “IBEW Employee” shall mean a Union Employee who is an Eligible Employee and who is subject to a collective bargaining agreement between an Employing Company and an International Brotherhood of Electrical Workers (“IBEW”) local union, as represented collectively through the IBEW UCC-1.

8

2.46    “Investment Fund” shall mean any one of the funds described in Article VIII which constitutes part of the Trust Fund.
2.47    “Key Employee” shall mean any Employee or former Employee (and his Beneficiary) who is a key employee within the meaning of Code Section 416(i)(1).
2.48    “Limitation Year” shall mean the Plan Year.
2.49    “Look-Back Year” shall mean the Plan Year preceding the Determination Year.
2.50    “Mirant” shall mean Mirant Corporation, any subsidiary of Mirant Corporation, or any successor thereto.
2.51    “Nicor Thrift Plan” shall mean the Nicor Gas Thrift Plan.
2.52    “Non Highly Compensated Employee” shall mean an Employee who is not a Highly Compensated Employee.
2.53    “Normal Retirement Date” shall mean the first day of the month following a Participant’s sixty-fifth (65th) birthday.
2.54    “One-Year Break in Service” shall mean each twelve-consecutive-month period within the period commencing with an Employee’s Break-in-Service Date and ending on the date the Employee is again credited with an Hour of Service.
2.55    “Participant” shall mean (a) an Eligible Employee who has elected to participate in the Plan as provided in Article III and whose participation in the Plan at the time of reference has not been terminated as provided in the Plan, (b) an Employee or former Employee who has ceased to be an active Participant under (a) above, but for whom an Account is maintained under the Plan, (c) an Eligible Employee who has made a Rollover Contribution to this Plan to the extent that the Provisions of the Plan apply to such Rollover Contribution of the Eligible Employee, (d) an Employee or former Employee for whom an Account is maintained for amounts transferred to the Plan from the Performance Sharing Plan, (e) an Employee or former Employee for whom an Account is maintained for amounts transferred to the Plan from the Employee Stock Ownership Plan, and (f) an Employee or Former Employee for whom an Account holds amounts transferred to the Plan from the AGL RSP Plan or the Nicor Thrift Plan.
2.56    “Pension Fund Investment Review Committee” shall mean the Pension Fund Investment Review Committee of The Southern Company System appointed pursuant to Section 13.4.
2.57    “Performance Sharing Plan” shall mean The Southern Company Performance Sharing Plan, as such plan existed prior to June 21, 2002.
2.58    “Permissive Aggregation Group” shall mean a group of plans consisting of the Required Aggregation Group and, at the election of the Affiliated Employers, such other plan or plans not required to be included in the Required Aggregation Group, provided the resulting 

9

group, taken as a whole, would continue to satisfy the provisions of Code Section 401(a)(4) and 410.
2.59    “Plan” shall mean The Southern Company Employee Savings Plan, as described herein or as from time to time amended.
2.60    “Plan of Reorganization” shall mean the Second Amended Joint Chapter 11 Plan of Reorganization for Mirant Corporation and its Affiliated Debtors.
2.61    “Plan Year” shall mean the twelve-month period commencing January 1st and ending on the last day of December next following.
2.62    “Present Value of Accrued Retirement Income” shall mean an amount determined solely for the purpose of determining if the Plan, or any other plan included in a Required Aggregation Group of which the Plan is a part, is top heavy in accordance with Code Section 416.
2.63    “Required Aggregation Group” shall mean those plans that are required to be aggregated as determined under this Section 2.62.  In determining a Required Aggregation Group hereunder, each plan of the Affiliated Employers in which a Key Employee is a participant and each other plan of the Affiliated Employers which enables any plan in which a Key Employee participates to meet the requirements of Code Section 410 or 401(a)(4) will be required to be aggregated.
2.64    “Rollover Contribution” shall mean that portion of an eligible rollover distribution that an Eligible Employee elects to contribute to this Plan in accordance with the requirements of Section 4.10.  The Plan will accept a direct rollover of an eligible rollover distribution from (a) a qualified plan described in Code Section 401(a) or 403(a), (b) an annuity contract described in Code Section 403(b), or (c) an eligible plan under Code Section 457(b).  In addition, the Plan will accept a Rollover Contribution from a conduit individual retirement account or annuity (“IRA”).  However, in no event shall the Plan accept Roth contributions from a Roth IRA as described in Code Section 408A as a Rollover Contribution.
2.65    “Roth Contribution” shall mean contributions made pursuant to Section 4.1 during the Plan Year, at the election of the Participant, in lieu of all or a portion of the Elective Employer Contribution that a Participant is otherwise entitled to make to the Plan and which is treated by the Participant as includible in the Participant’s gross income pursuant to Code Section 402A at the time the Participant would have received the amount in cash if the Participant had not made such an election.
2.66    “Surviving Spouse” shall mean the person to whom the Participant is married on the date of his death, if such spouse is then living.
2.67    “Top-Heavy Group” shall mean an Aggregation Group in which, as of the Determination Date, the sum of:
(a)    the Present Value of Accrued Retirement Income of Key Employees under all defined benefit plans included in that group, and

10

(b)    the Aggregate Accounts of Key Employees under all defined contribution plans included in the group, exceeds 60% of a similar sum determined for all employees.
2.68     “Trust” or “Trust Fund” shall mean the trust established pursuant to the Trust Agreement.
2.69    “Trust Agreement” shall mean the trust agreement between the Company and the Trustee, as described in Article XIV.
2.70    “Trustee” shall mean the person or corporation designated as trustee under the Trust Agreement, including any successor or successors.
2.71    “Union Employee” shall mean an Employee who is represented by a collective bargaining agreement.
2.72    “Valuation Date” shall mean each business day of the New York Stock Exchange.
2.73    “Voluntary Participant Contribution” shall mean a contribution made pursuant to Section 4.6 during the Plan Year.
2.74    “Year of Service” shall mean a twelve-month period of employment as an Employee, including any fractions thereof.  Calculation of the twelve-month periods shall commence with the Employee’s first day of employment, which is the date on which an Employee first performs an Hour of Service, and shall terminate on his Break-in-Service Date.  Thereafter, if he has more than one period of employment as an Employee, his Years of Service for any subsequent period shall commence with the Employee’s reemployment date, which is the first date following a Break-in-Service Date on which the Employee performs an Hour of Service, and shall terminate on his next Break-in-Service Date.  An Employee who has a Break-in-Service Date and resumes employment with the Affiliated Employers within twelve months of his Break-in-Service Date shall receive a fractional Year of Service for the period of such cessation of employment.
Notwithstanding anything in this Section 2.74 to the contrary, an Employee shall not receive credit for more than one Year of Service with respect to any twelve-consecutive-month period.

11

ARTICLE III
 
PARTICIPATION
3.1    Eligibility Requirements.
(a)    Each Eligible Employee who was an active Participant on December 31, 2017 shall continue to be an active Participant in the Plan on January 1, 2018, provided he remains an Eligible Employee.  Each Eligible Employee having an AGL RSP account and/or a Nicor Thrift Plan account that is merged into the Plan effective January 1, 2018 shall be immediately eligible to participate in the Plan.  Each other Eligible Employee may elect to participate in the Plan as of any Enrollment Date after the Employee’s first day of employment as an Eligible Employee or as soon as administratively practicable thereafter.  An Eligible Employee shall make an election to participate by authorizing deductions from or reduction of his Compensation as contributions to the Plan in accordance with Article IV, and directing the investment of such contributions in accordance with Article VIII.  Such Compensation deduction and/or reduction authorization and investment direction shall be made in accordance with the procedures established by the Administrative Committee.
(b)    Notwithstanding (a) above, each Eligible Employee who is hired on or after December 1, 2017 (or on or after October 30, 2017 for an Eligible Employee having an AGL RSP account, or on or after July 1, 2017 for an Eligible Employee having a Nicor Thrift Plan account, as applicable) shall immediately participate in the Plan after 30 days of employment or such Enrollment Date that occurs as soon as administratively practicable thereafter.  If such Eligible Employee does not make an affirmative election after receipt of notice regarding his Employer Elective Contributions, he shall participate in the Plan as soon as administratively practicable and shall be deemed to have elected an Elective Employer Contribution rate of six percent (6%) of his Compensation (as such Compensation is adjusted pursuant to Section 4.1), provided that, such Eligible Employee may elect at any time to increase or decrease this deemed contribution percentage (including a decrease to a zero percent (0%) contribution rate) in the manner provided in Section 4.1 of the Plan.
3.2    Participation upon Reemployment.  If an Employee terminates his employment with an Affiliated Employer and is subsequently reemployed as an Eligible Employee, he shall become an active Participant in the Plan at the time and in the manner provided in Section 3.1 of the Plan.
3.3    No Restoration of Previously Distributed Benefits.  A Participant who has terminated his employment with the Affiliated Employers and who has received a distribution of the amount credited to his Account pursuant to Section 12.1 shall not be entitled to restore the amount of such distribution to his Account if he is reemployed and again becomes a Participant in the Plan.
A Participant whose benefit under the Plan was transferred to a qualified plan maintained by Mirant Services, LLC as a result of the spin-off of Mirant from the Southern Company 

12

controlled group on April 2, 2001 shall not be entitled to restoration of the amount of such transfer upon his subsequent reemployment by an Affiliated Employer.
Notwithstanding the foregoing, a Participant who terminated employment at a time when he was zero percent (0%) vested in his account under the Performance Sharing Plan and was deemed cashed-out of the Performance Sharing Plan, and who returns to the employ of an Affiliated Employer before incurring five (5) consecutive One-Year Breaks in Service shall be deemed to have bought back into this Plan and shall be entitled to a restoration of his benefits attributable to amounts under the Performance Sharing Plan, unadjusted for any subsequent gains or losses.
3.4    Loss of Eligible Employee Status.  If a Participant loses his status as an Eligible Employee, but remains an Employee, such Participant shall be ineligible to participate and shall be deemed to have elected to suspend his Voluntary Participant Contributions, Elective Employer Contributions, and/or Roth Contributions.
3.5    Military Leave.
(a)    Notwithstanding any provision of the Plan to the contrary, contributions, benefits, and service credit with respect to qualified military service will be provided in accordance with Code Section 414(u).  Loan repayments may be suspended under the Plan as permitted under Code Section 414(u)(4).
(b)    For purposes of Code Section 401(k)(2)(B)(i)(I), effective January 1, 2009, a Participant is treated as having been severed from employment during any period such Participant is performing service in the Uniform Services described in Code Section 3401(h)(2)(A).  If such a Participant elects to receive a distribution by reason of severance from employment, the Participant may not make an Elective Employer Contribution and/or Roth Contribution or other employee contribution during the six-month period beginning on the date of any such distribution.
(c)    A Participant is entitled to receive a “qualified reservist distribution” provided the Participant meets the following requirements:  (i) he is ordered or called to active military duty after September 11, 2001; (ii) the distribution is from amounts attributable to Elective Employer Contributions and, effective January 1, 2010, Roth Contributions; (iii) the Participant is a member of a reserve component, as defined in Section 101 of Title 37, United States Code, and was ordered or called to active duty for a period in excess of 179 days or for an indefinite period; and (iv) the Participant, in a manner prescribed by the Administrative Committee, makes an election to receive a distribution of his Elective Employer Contributions and/or, effective January 1, 2010, Roth Contributions during the period beginning on the date the Participant is ordered or called to active duty and ending at the close of such active duty period.
3.6    Elizabethtown Gas Company Union Employees.  Certain Union Employees described in Appendix B shall become Eligible Employees and commence participation upon the merger of the AGL RSP Plan into this Plan effective January 1, 2018.  Where applicable, such Union Employees shall retain benefits, rights and features associated with their Account in the 

13

AGL RSP Plan on and after January 1, 2018 as provided for in Appendix B, as applicable, until such time the representatives of the applicable bargaining unit and the applicable Employing Company agree to amend such Appendix.  Unless modified by an Appendix, the terms of the Plan control with respect to any such Union Employee.

14

ARTICLE IV
 
ELECTIVE EMPLOYER CONTRIBUTIONS, ROTH CONTRIBUTIONS, 
AND VOLUNTARY PARTICIPANT CONTRIBUTIONS
4.1    Elective Employer Contributions and/or Roth Contributions.  Subject to the combined limitation on Elective Employer Contributions and/or Roth Contributions and Voluntary Participant Contributions under Section 4.6, an Eligible Employee who meets the participation requirements of Article III may elect in accordance with the procedures established by the Administrative Committee to have his Compensation contributed and/or reduced as Elective Employer Contribution and/or Roth Contribution to be contributed to his Account under the Plan, as the case may be, by a whole percentage of his Compensation, which percentage shall not be less than one percent (1%) nor more than fifty percent (50%) of his Compensation (excluding Compensation that is an annual incentive bonus), except to the extent permitted under Section 4.11 of the Plan and Code Section 414(v).  Annual incentive bonuses may only be contributed by making a separate election in accordance with procedures established by the Administrative Committee.
Notwithstanding the preceding paragraph, an IBEW Employee may not contribute any portion of an annual incentive bonus as an Elective Employer Contribution or Roth Contribution.
4.2    Maximum Amount of Elective Employer Contributions and/or Roth Contributions.  Subject to Section 4.11, the maximum amount of Elective Employer Contributions and/or Roth Contributions of a Participant that may be made during any Plan Year to this Plan or any other qualified plan maintained by an Employing Company shall not exceed the dollar limitation set forth in Code Section 402(g) in effect at the beginning of such Plan Year.
4.3    Distribution of Excess Deferral Amounts.
(a)    In General.  Notwithstanding any other provision of the Plan, Excess Deferral Amounts and income allocable thereto shall be distributed (and any corresponding Employer Matching Contributions shall be forfeited) no later than April 15, 2007, and each April 15 thereafter, to Participants who allocate (or are deemed to allocate) such amounts to this Plan pursuant to (b) below for the preceding calendar year.  In the event that a Participant has Excess Deferral Amounts and has made both Elective Employer Contributions and Roth Contributions, the Plan shall distribute Elective Employer Contributions first.  Excess Deferral Amounts that are distributed shall not be treated as an Annual Addition.  Any Employer Matching Contributions forfeited pursuant to this subsection (a) shall be applied, subject to Section 6.1, toward funding Employing Company contributions (for the Plan Year immediately following the Plan Year to which such forfeited Employer Matching Contributions relate) or distributed, as directed by the Administrative Committee, to the extent permitted by applicable law.
(b)    Assignment.  The Participant’s allocation of amounts in excess of the Code Section 402(g) limits to this Plan shall be in writing; shall be submitted to the Administrative Committee no later than March 1; shall specify the Participant’s Excess 

15

Deferral Amount for the preceding calendar year; and shall be accompanied by the Participant’s written statement that if such amounts are not distributed, such Excess Deferral Amount, when added to amounts deferred under other plans or arrangements described in Code Section 401(k), 408(k), 408(p), 402(h)(1)(B), 457, 501(c)(18), or 403(b), exceeds the limit imposed on the Participant by Code Section 402(g) for the year in which the deferral occurred.  A Participant is deemed to notify the Administrative Committee of any Excess Deferral Amounts that arise by taking into account only those deferrals under this Plan and any other plans of an Affiliated Employer.
(c)    Determination of Income or Loss.  The Excess Deferral Amount distributed to a Participant with respect to a calendar year shall be adjusted for any income or loss through the end of the current Plan Year (subject to Section 4.3(d) below) pursuant to the method of allocating income determined by the Administrative Committee.  The income or loss allocable to Excess Deferral Amounts is the sum of:
(1)    income or loss allocated to the Participant’s Account for the taxable year multiplied by a fraction, the numerator of which is such Participant’s Excess Deferral Amount for the year and the denominator is the Participant’s Account balance attributable to Elective Employer Contributions and/or Roth Contributions, minus any income or plus any loss occurring during the Plan Year; and
(2)    if the Administrative Committee shall determine in its sole discretion, ten percent (10%) of the amount determined under (1) above multiplied by the number of whole calendar months between the end of the Plan Year and the date of the distribution, counting the month of distribution if distribution occurs after the 15th of the month.
Notwithstanding the above, the Administrative Committee may designate any reasonable method for computing the income or loss allocable to Excess Deferral Amounts, provided that the method does not violate Code Section 401(a)(4), is used consistently for all Participants and for all corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating income or loss to Participants’ Accounts.
(d)    Maximum Distribution Amount.  The Excess Deferral Amount, which would otherwise be distributed to the Participant, shall, if there is a loss allocable to such Excess Deferral Amount, in no event be less than the lesser of the Participant’s Account under the Plan attributable to Elective Employer Contributions and/or Roth Contributions or the Participant’s Elective Employer Contributions and/or Roth Contributions for the Plan Year.
4.4    Additional Rules Regarding Elective Employer Contributions and/or Roth Contributions.
(a)    Salary reduction agreements shall be governed by the following:
(1)    A salary reduction agreement shall apply to payroll periods during which such salary reduction agreement is in effect.  The Administrative 

16

Committee, in its discretion, may establish administrative procedures whereby the actual reduction in Compensation may be made to coincide with each payroll period of the Employing Company, or at such other times as the Administrative Committee may determine.
(2)    The Employing Company may amend or revoke its salary reduction agreement with any Participant at any time, if the Employing Company determines that such revocation or amendment is necessary to ensure that a Participant’s additions for any Plan Year will not exceed the limitations of Sections 4.2 and 6.1 of the Plan or to ensure that the Actual Deferral Percentage Test is satisfied.
(b)    Roth Contribution elections shall be governed by the following:
(1)    Roth Contribution elections shall apply to payroll periods during which such elections are in effect.  The Administrative Committee, in its discretion, may establish administrative procedures whereby the actual contribution of Compensation may be made to coincide with each payroll period of the Employing Company, or at such other times as the Administrative Committee may determine.
(2)    The Employing Company may amend or revoke the Roth Contribution election of any Participant at any time, if the Employing Company determines that such revocation or amendment is necessary to ensure that a Participant’s additions for any Plan Year will not exceed the limitations of Sections 4.2 and 6.1 of the Plan or to ensure that the Actual Deferral Percentage Test is satisfied.
(c)    Except as required under (a)(2) and (b)(2) above, and under Section 4.5(b) below, no amounts attributable to Elective Employer Contributions and/or Roth Contributions may be distributed to a Participant or his Beneficiary from his Account prior to the earlier of:
(1)    the severance from employment, death or disability of the Participant;
(2)    the attainment of age 591⁄2 by the Participant;
(3)    the termination of the Plan without establishment of a successor plan; or
(4)    a financial hardship of the Participant pursuant to Section 11.5 of the Plan.
4.5    Section 401(k) Nondiscrimination Tests.
(a)    Actual Deferral Percentage Test.  The Plan shall satisfy the nondiscrimination test of Code Section 401(k)(3), under which no Elective Employer 

17

Contributions and/or Roth Contributions shall be made that would cause the Actual Deferral Percentage for Eligible Participants who are Highly Compensated Employees to exceed the following:
(1)    The Average Actual Deferral Percentage for the Eligible Participants who are Highly Compensated Employees in the current Plan Year shall not exceed the Average Actual Deferral Percentage for the prior Plan Year for Eligible Participants who were Non Highly Compensated Employees for the prior Plan Year multiplied by 1.25; or
(2)    The Average Actual Deferral Percentage for Eligible Participants who are Highly Compensated Employees in the current Plan Year shall not exceed the Average Actual Deferral Percentage for Eligible Participants who were Non Highly Compensated Employees in the prior Plan Year multiplied by two (2), provided that the Average Actual Deferral Percentage for Eligible Participants who are Highly Compensated Employees in the current Plan Year does not exceed the Average Actual Deferral Percentage for the prior Plan Year for Eligible Participants who were Non Highly Compensated Employees in the prior Plan Year by more than two (2) percentage points.
(b)    Distribution of Excess Deferral Contributions.
(1)    In General.  The Excess Deferral Contributions for a Highly Compensated Employee for a Plan Year which are to be distributed shall be distributed such that the Highly Compensated Employee with the highest amount of Elective Employer Contributions and/or Roth Contributions for the Plan Year shall be reduced to the extent required to:
(A)    distribute the total amount of Excess Deferral Contributions, or
(B)    cause the amount of such Highly Compensated Employee’s Elective Employer Contributions and/or Roth Contributions to equal the amount of Elective Employer Contributions and/or Roth Contributions of the Highly Compensated Employee with the next highest amount of Elective Employer Contributions and/or Roth Contributions for the Plan Year.
This process must be repeated until all Excess Deferral Contributions are distributed.
In the event that a Participant has Excess Deferral Contributions and has made both Elective Employer Contributions and Roth Contributions, the Plan shall distribute Elective Employer Contributions first.
Excess Deferral Contributions plus any income and minus any loss allocable thereto shall be distributed (and any corresponding Employer Matching Contribution shall be forfeited) to Participants having such Excess Deferral Contributions within two and one-half (21⁄2) months after the last day of the Plan Year in which such excess amounts arose, and in any event not later 

18

than the last day of the Plan Year following the close of the Plan Year for which such contributions were made.  Distribution of Excess Deferral Contributions shall be made to Highly Compensated Employees in accordance with this Section 4.5 (b).  Any Employer Matching Contributions forfeited pursuant to this Subsection (b) (1) shall be applied, subject to Section 6.1, toward funding Employing Company contributions (for the Plan Year immediately following the Plan Year to which such forfeited Employer Matching Contributions relate) or distributed, as directed by the Administrative Committee, to the extent permitted by applicable law.
(2)    Determination of Income or Loss.  Excess Deferral Contributions to be distributed shall be adjusted for any income or loss through the end of the current Plan Year (subject to Section 4.5(b)(3) below) pursuant to the method of allocating income determined by the Administrative Committee.  The income or loss allocable to such Excess Deferral Contributions is the sum of:
(A)    income or loss allocated to the Participant’s Account for the taxable year multiplied by a fraction, the numerator of which is the Participant’s Excess Deferral Contributions to be distributed for the year and the denominator is the Participant’s Account balance attributable to Elective Employer Contributions and/or Roth Contributions, minus any income or plus any loss occurring during the Plan Year; and
(B)    if the Administrative Committee shall determine in its sole discretion, ten percent (10%) of the amount determined under (A) above multiplied by the number of whole calendar months between the end of the Plan Year and the date of the distribution, counting the month of distribution if distribution occurs after the 15th of the month.
Notwithstanding the above, the Administrative Committee may designate any reasonable method for computing the income or loss allocable to Excess Deferral Contributions, provided that the method does not violate Code Section 401(a)(4), is used consistently for all Participants and for all corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating income or loss to Participants’ Accounts.  
(3)    Maximum Distribution Amount.  The Excess Deferral Contributions which would otherwise be distributed to the Participant shall be adjusted for income; shall be reduced, in accordance with regulations, by the Excess Deferral Amount distributed to the Participant; and shall, if there is a loss allocable to the Excess Deferral Contributions, in no event be less than the lesser of the Participant’s Account under the Plan attributable to Elective Employer Contributions and/or Roth Contributions or the Participant’s Elective Employer Contributions and/or Roth Contributions for the Plan Year.
(c)    Special Rules.
(1)    For purposes of this Section 4.5, the Actual Deferral Percentage for any Eligible Participant who is a Highly Compensated Employee for the Plan Year and who is eligible to have deferral contributions allocated to his account 

19

under two (2) or more plans or arrangements described in Code Section 401(k) that are maintained by an Affiliated Employer shall be determined as if all such deferral contributions were made under a single arrangement.  If a Highly Compensated Employee participates in two (2) or more cash or deferred arrangements that have different plan years, all cash or deferred contributions made under such arrangements with or within the same calendar year shall be treated as a single arrangement.  Notwithstanding the foregoing, certain plans shall be treated as separate if mandatorily disaggregated under Code Section 401(k).  For purposes of the Actual Deferral Percentage Test under this Section 4.5, the Company Stock Fund shall not be treated as a separate arrangement.
(2)    In the event that this Plan satisfies the requirements of Code Section 401(k), 401(a)(4), or 410(b) only if aggregated with one or more other plans, or if one or more other plans satisfy the requirements of Code Section 401(k), 401(a)(4), or 410(b) only if aggregated with this Plan, then the actual deferral percentages shall be determined as if all such plans were a single plan.
4.6    Voluntary Participant Contributions.  An Eligible Employee who meets the participation requirements of Article III may elect in accordance with the procedures established by the Administrative Committee to contribute to his Account a Voluntary Participant Contribution consisting of any whole percentage of his Compensation, which percentage is not less than one percent (1%) nor more than fifty percent (50%) of his Compensation.  Annual incentive bonuses may only be contributed by making a separate election in accordance with procedures established by the Administrative Committee.  The maximum Voluntary Participant Contribution shall be reduced by the percent, if any, which is contributed as an Elective Employer Contribution and/or Roth Contribution attributable to such Participant under Section 4.1.  The Employing Company may amend or revoke the Voluntary Participant Contribution election of any Participant at any time, if the Employing Company determines that such revocation or amendment is necessary to ensure that a Participant’s additions for any Plan Year will not exceed the limitations of Section 6.1 of the Plan or to ensure that the Actual Contribution Percentage Test is satisfied.
Notwithstanding the preceding paragraph, an IBEW Employee may not contribute any annual incentive bonus as a Voluntary Participant Contribution.
4.7    Manner and Time of Payment of Elective Employer Contributions, Roth Contributions, and Voluntary Participant Contributions.  Contributions made in accordance with Sections 4.1 and 4.6 will be made only through payroll deductions and will be effective as of the payroll period commencing as soon as practicable after the date on which the Participant elects to commence participation in the Plan.  Contributions shall be remitted to the Trustee as of the earliest date on which such contributions can reasonably be segregated from each Employing Company’s general assets, but in any event not later than the fifteenth (15th) business day of the month following the month during which such amounts would otherwise have been payable to the Participant in cash or such earlier time as may be prescribed by applicable law.
4.8    Change in Contribution Rate.  A Participant may prospectively change the percentage of his Compensation that he has authorized as the Elective Employer Contribution, 

20

Roth Contribution, and/or Voluntary Participant Contribution to another permissible percentage in accordance with the procedures established by the Administrative Committee.  Such election shall be effective as soon as practicable after it is made.
4.9    Change in Contribution Amount.  In the event of a change in the Compensation of a Participant, the percentage of the Elective Employer Contribution, Roth Contribution, and/or Voluntary Participant Contribution currently in effect shall be applied as soon as practicable with respect to such changed Compensation without action by the Participant.
4.10    Rollovers from Other Plans.  An Eligible Employee who has received a distribution of his interest in a retirement plan of a former employer, or a distribution of the interest of his deceased spouse in a retirement plan of his spouse’s former employer, under circumstances meeting the requirements of Code Section 402(c)(4) relating to eligible rollover distributions from qualified plans, including plans established under Code Section 403(b) or 457(b), may elect to deposit all or any portion (as designated by such Eligible Employee) of the amount of such distribution as a Rollover Contribution to this Plan, provided that prior to January 1, 2010, such Rollover Contribution shall not include a rollover from a Roth account as defined in Code Section 402A.  A Rollover Contribution may be made only within sixty (60) days following the date the Eligible Employee receives the distribution from the plan of his former employer (or within such additional period as may be provided under Code Section 408 if the Eligible Employee shall have made a timely deposit of the distribution in an individual retirement account).
The Administrative Committee shall establish rules and procedures to implement this Section 4.10, including without limitation, such procedures as may be appropriate to permit the Administrative Committee to verify the tax qualified status of the plan of the former employer and compliance with any applicable provisions of the Code relating to such contributions.  The amount contributed to the Trustee pursuant to this Section 4.10 shall be placed in the Eligible Employee’s Rollover Contribution subaccount for the benefit of the Eligible Employee pursuant to Section 9.1.  The Eligible Employee shall have a fully vested interest in the balance of his Rollover Contribution subaccount at all times and such Rollover Contribution subaccount shall share in the earnings, gains, and losses of the Trust Fund as set forth in Article IX of the Plan.  An Employee shall be entitled to a distribution of his Rollover Contribution subaccount pursuant to the applicable provisions of Article XI and Article XII hereof.
4.11    Catch-up Contributions.  All Eligible Participants who will have attained age fifty (50) before the close of the taxable year shall be eligible to make Catch-up Contributions and Catch-up Roth Contributions in accordance with, and subject to the limitations of, Code Section 414(v).  Such Catch-up Contributions and Catch-up Roth 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 Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416, as applicable, by reason of making of such Catch-up Contributions and Catch-up Roth Contributions.  Catch-up Contributions and Catch-up Roth Contributions shall be made in such dollar amounts as elected by the Participant in accordance with the procedures established by the Administrative Committee.

21

ARTICLE V
 
EMPLOYER MATCHING CONTRIBUTIONS
5.1    Amount of Employer Matching Contributions.  The Board of Directors, in its sole and absolute discretion, shall determine the amount of Employer Matching Contributions that shall be made by each Employing Company on behalf of each Participant in its employ.  The amount of Employer Matching Contributions shall be fixed by resolutions of the Board of Directors and communicated to each Employing Company prior to the first day the determined match becomes effective.  Notwithstanding the foregoing and except for an IBEW Employee, the Board of Directors expects to make Employer Matching Contributions of one hundred percent (100%) on the first four percent (4%) of Compensation deferred during a payroll period and fifty-five (55%) on the next two percent (2%) of Compensation deferred during a payroll period, provided that, for purposes of this Section 5.1 Compensation shall not include annual incentive bonuses when calculating such Employer Matching Contribution.
5.2    Payment of Employer Matching Contributions.  Except as provided herein, Employer Matching Contributions shall be remitted to the Trustee as soon as practicable after the payroll period to which they relate.
5.3    Limitations on Employer Matching Contributions and Voluntary Participant Contributions.
(a)    Actual Contribution Percentage Test.  The Plan shall satisfy the nondiscrimination test of Code Section 401(m), under which the Average Contribution Percentage for Eligible Participants shall not exceed (1) or (2) as follows:
(1)    The Average Contribution Percentage for Eligible Participants who are Highly Compensated Employees in the current Plan Year shall not exceed the Average Contribution Percentage for the prior Plan Year for Eligible Participants who were Non Highly Compensated Employees in the prior Plan Year multiplied by 1.25; or
(2)    The Average Contribution Percentage for Eligible Participants who are Highly Compensated Employees in the current Plan Year shall not exceed the Average Contribution Percentage for Eligible Participants who were Non Highly Compensated Employees in the prior Plan Year multiplied by two (2), provided that the Average Contribution Percentage for Eligible Participants who are Highly Compensated Employees in the current Plan Year does not exceed the Average Contribution Percentage for the prior Plan Year for Eligible Participants who were Non Highly Compensated Employees in the prior Plan Year by more than two (2) percentage points.
(b)    Distribution of Excess Aggregate Contributions.
(1)    In General.  The Excess Aggregate Contributions for a Highly Compensated Employee for a Plan Year which are to be distributed shall be distributed such that the Highly Compensated Employee with the highest amount 

22

of Matching Employer Contributions and Voluntary Participant Contributions shall be reduced to the extent required to:
(A)    distribute the total amount of Excess Aggregate Contributions, or
(B)    cause the amount of such Highly Compensated  Employee’s Employer Matching Contributions and Voluntary Participant Contributions to equal the amount of Employer Matching Contributions and Voluntary Participant Contributions of the Highly Compensated Employee with the next highest amount of Employer Matching Contributions and Voluntary Participant Contributions for the Plan Year.
This process must be repeated until all Excess Aggregate Contributions are distributed.
Excess Aggregate Contributions, plus any income and minus any loss allocable thereto, shall be distributed (or, if forfeitable, forfeited) within 21⁄2 months after the last day of the Plan Year in which such excess amounts arose, and in any event not later than the last day of the following Plan Year, to Participants to whose Accounts such Excess Aggregate Contributions were allocated for the Plan Year.  Excess Aggregate Contributions shall be treated as Annual Additions.
(2)    Determination of Income or Loss.  Excess Aggregate Contributions to be distributed shall be adjusted for any income or loss through the end of the current Plan Year pursuant to the method of allocating income determined by the Administrative Committee.  The income or loss allocable to such Excess Aggregate Contributions is the sum of:
(A)    income or loss allocated to the Participant’s Account attributable to Voluntary Participant Contributions and Employer Matching Contributions to be distributed for the Plan Year multiplied by a fraction, the numerator of which is the Participant’s Excess Aggregate Contributions for the year and the denominator is the Participant’s Account balance attributable to Voluntary Participant Contributions and Employer Matching Contributions, minus any income or plus any loss occurring during the Plan Year; and
(B)    if the Administrative Committee shall determine in its sole discretion, ten percent (10%) of the amount determined under (1) above multiplied by the number of whole calendar months between the end of the Plan Year and the date of the distribution, counting the month of distribution if distribution occurs after the 15th of the month.
Notwithstanding the above, the Administrative Committee may designate any reasonable method for computing the income or loss allocable to Excess Aggregate Contributions, provided that the method does not violate Code Section 401(a)(4), is used consistently for all Participants and for all corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating income or loss to Participants’ Accounts.  

23

(3)    Accounting for Excess Aggregate Contributions.  Excess Aggregate Contributions shall be distributed first from Voluntary Participant Contributions allocated to the Participant’s Account and any corresponding Employer Matching Contribution shall also be forfeited and then, if necessary, distributed from the remaining Employer Matching Contribution allocated to the Participant’s Account.
(c)    Special Rules.
(1)    The Contribution Percentage for any Eligible Participant who is a Highly Compensated Employee for the Plan Year and who is eligible to make voluntary participant contributions, to receive employer matching contributions, or to make deferral contributions under two or more plans described in Code Section 401(a) or arrangements described in Code Section 401(k) that are maintained by an Affiliated Employer shall be determined as if all such contributions were made under a single plan.
(2)    In the event that this Plan satisfies the requirements of Code Section 401(m), 401(a)(4), or 410(b) only if aggregated with one or more other plans, or if one or more other plans satisfy the requirements of Code Section 401(m), 401(a)(4), or 410(b) only if aggregated with this Plan, then the contribution percentages shall be determined as if all such plans were a single plan.
5.4    Reversion of Employing Company Contributions.  Employing Company contributions computed in accordance with the provisions of this Plan shall revert to the Employing Company under the following circumstances:
(a)    In the case of an Employing Company contribution which is made by reason of a mistake of fact, such contribution upon written direction of the Employing Company shall be returned to the Employing Company within one year after the payment of the contribution.
(b)    If any Employing Company contribution is determined to be nondeductible under Code Section 404, then such Employing Company contribution, to the extent that it is determined to be nondeductible, upon written direction of the Employing Company shall be returned to the Employing Company within one year after the disallowance of the deduction.
The amount which may be returned to the Employing Company under this Section 5.4 is the excess of (1) the amount contributed over (2) the amount that would have been contributed had there not occurred a mistake of fact or disallowance of the deduction.  Earnings attributable to the excess contribution shall not be returned to the Employing Company, but losses attributable thereto shall reduce the amount to be so returned.  If the withdrawal of the amount attributable to the mistaken contribution would cause the balance of the Account of any Participant to be reduced to less than the balance which would have been in the Account had the 

24

mistaken amount not been contributed, then the amount to be returned to the Employing Company shall be limited so as to avoid such reduction.
5.5    Correction of Prior Incorrect Allocations and Distributions.  Notwithstanding any provisions contained herein to the contrary, in the event that, as of any Valuation Date, adjustments are required in any Participants’ Accounts to correct any incorrect allocation of contributions or investment earnings or losses, or such other discrepancies in Account balances that may have occurred previously, the Employing Companies may make additional contributions to the Plan to be applied to correct such incorrect allocations or discrepancies.  The additional contributions shall be allocated by the Administrative Committee to adjust such Participants’ Accounts to the value which would have existed on said Valuation Date had there been no prior incorrect allocation or discrepancies.  The Administrative Committee shall also be authorized to take such other actions as it deems necessary to correct prior incorrect allocations or discrepancies in the Accounts of Participants under the Plan.

25

ARTICLE VI
 
LIMITATIONS ON CONTRIBUTIONS
6.1    Section 415 Limitations.  Notwithstanding any provision of the Plan to the contrary, except to the extent permitted under Code Section 414(v), the total Annual Additions allocated to the Account (and the accounts under all defined contribution plans maintained by an Affiliated Employer) of any Participant for any Limitation Year in accordance with Code Section 415 and the regulations thereunder, which are incorporated herein by this reference, shall not exceed the lesser of the following amounts:
(a)    one hundred percent (100%) of the Participant’s compensation (as defined in Code Section 415(c)(3) and any rulings and regulations thereunder and, for the avoidance of doubt, including military differential pay) in the Limitation Year; or
(b)    $55,000 (as adjusted pursuant to Code Section 415(d)(1)(C)).
6.2    Combination of Plans.  If an Employee participates in more than one defined contribution plan maintained by an Affiliated Employer and his Annual Additions exceed the limitations of Section 6.1, corrective adjustments shall be made first under this Plan and then, to the extent necessary, under such other defined contribution plan.

26

ARTICLE VII 
 
SUSPENSION OF CONTRIBUTIONS
7.1    Suspension of Contributions.  A Participant may (on a prospective basis) voluntarily suspend the Elective Employer Contributions, Roth Contributions, and/or his Voluntary Participant Contributions in accordance with the procedures established by the Administrative Committee.  Such suspension shall be effective as soon as practicable after it is made.  Whenever Elective Employer Contributions, Roth Contributions, and/or Voluntary Participant Contributions are suspended, Employer Matching Contributions shall also be suspended.
7.2    Resumption of Contributions.  A Participant may terminate prospectively a suspension described in Section 7.1 in accordance with the procedures established by the Administrative Committee.  Such resumption of contributions shall be effective as soon as practicable after the election to terminate prospectively the suspension is made.  There shall be no make up of any contributions by a Participant or by an Employing Company with respect to a period of suspension.

27

ARTICLE VIII 
 
INVESTMENT OF CONTRIBUTIONS
8.1    Investment Funds.  Except for the Company Stock Fund, which shall be and remain an Investment Fund as a matter of Plan design and without any action by the Pension Fund Investment Review Committee, the Pension Fund Investment Review Committee may from time to time select or terminate other Investment Funds.  The Company Stock Fund shall be exclusively invested and, subject to Section 12.12 of the Plan, reinvested in Common Stock, provided that funds applicable to the purchase of Common Stock pending investment of such funds may be temporarily invested in short-term United States Government obligations, other obligations guaranteed by the United States Government, commercial paper, or certificates of deposit, and, if the Trustee so determines, may be transferred to money market funds utilized by the Trustee for qualified employee benefit trusts.
8.2    Investment of Contributions.  Each Participant shall direct, at the time he elects to participate in the Plan and at such other times as may be directed by the Administrative Committee or pursuant to Section 8.5, that his Account be invested in one or more of the Investment Funds, provided such investments are made in one-percent (1%) increments.  Employer Matching Contributions made on or after November 1, 2006, shall be invested solely in accordance with a Participant’s investment direction.  With respect to any investment direction in effect on November 1, 2006 for Elective Employer Contributions and Voluntary Participant Contributions, such investment direction shall also apply to Employer Matching Contributions until the Participant makes a different investment direction.  A Participant may change his investment direction pursuant to Section 8.5.
8.3    Investment of Earnings.  Except as provided in Section 12.12, interest, dividends, if any, and other distributions received by the Trustee with respect to an Investment Fund shall be invested in such Investment Fund.
8.4    Transfer of Assets between Funds.  A Participant may direct in accordance with the provisions of this Section 8.4 and such procedures established by the Administrative Committee that all of his interest in an Investment Fund or Funds attributable to amounts in his Account or any portion of such amount (expressed in number of shares, whole dollar amounts, or one-percent (1%) increments) to the credit of his Account be transferred and invested by the Trustee as of such date in any other Investment Fund as designated by the Participant.  Such direction shall be effective as soon as practicable after it is made.
8.5    Change in Investment Direction.  Any investment direction given by a Participant shall continue in effect until changed by the Participant.  A Participant may change his investment direction as to the future contributions and allocations to his Account in accordance with the procedures established by the Administrative Committee, and such direction shall be effective as soon as practicable after it is made.
8.6    Section 404(c) Plan.  This Plan is intended to be a plan described in ERISA Section 404(c) and shall be interpreted in accordance with Department of Labor Regulations Section 1.404c-1, which is incorporated herein by this reference.  The Administrative Committee 

28

shall take such actions as it deems necessary or appropriate in its discretion to cause the Plan to comply with such requirements, including, but not limited to, providing Participants with the right to request and receive written confirmation of their investment instructions.  Further, the Administrative Committee shall take such actions as it deems necessary or appropriate in its discretion (a) to ensure that confidentiality procedures with respect to a Participant’s ownership of Common Stock and the exercise of ownership rights with respect to such Common Stock are adequate and utilized, and (b) to appoint an independent fiduciary to carry out such actions as the Administrative Committee determines involve the potential for undue influence on Participants with regard to the direct or indirect exercise of shareholder rights with respect to Common Stock.
8.7    Suspension, Discontinuance, or Restriction of Trading.  Notwithstanding any provision of the Plan to the contrary, the Administrative Committee shall take such actions as it deems necessary or appropriate to administer the Plan during any period in which trading of one or more investments has been suspended, discontinued, or otherwise restricted (for example, by ceasing to be traded on a recognized exchange) by application of the securities laws or for any other reason.  Such action may include, but shall not be limited to:  delaying or restricting fund transfers of such investment; delaying, limiting the amount of, or changing the source of loans, withdrawals or distributions under the Plan; or excluding such investment for purposes of determining the availability of loans or withdrawals.  However, in no event shall the foregoing give the Administrative Committee discretion or control over the investment of Plan assets.
8.8    Designated Net Litigation Distributions.  All “Designated Net Litigation Distributions” received by the Plan as described in Section 9.1(e) shall be invested in accordance with a Participant’s investment election under the procedures of this Article VIII in effect at any time such Designated Net Litigation Distributions are received by the Plan.  Section 13.13 shall apply in the event it is necessary to establish a new Account for a former Participant to hold Designated Net Litigation Distributions received by the Plan attributable to such former Participant and such former Participant has not made an affirmative investment election under the procedures of this Article VIII.
8.9    Diversification Requirements.  The Plan shall comply with the diversification requirements under Code Section 401(a)(35) set forth in this Section 8.9; provided, that the Plan may impose a restriction or condition on the divestiture of the Company Stock Fund that is either required by or reasonably designed to ensure compliance with applicable securities laws and the Plan also may impose other restrictions or conditions on investments in the Company Stock Fund that are permissible under Section 1.401(a)(35)-1(e) of the Treasury Regulations.
(a)    A Participant with any portion of his Account invested in the Company Stock Fund that has been purchased with Elective Employer Contributions, Catch-up Contributions, Catch-up Roth Contributions, Rollover Contributions, Roth Contributions, and/or Voluntary Participant Contributions may direct that all of his interest in the Company Stock Fund be divested and an equivalent amount be reinvested in any other Investment Fund as designated by the Participant.
(b)    A Participant who has completed three (3) Years of Service shall have the right to divest any part of his Account attributable to non-elective or Employer Matching 

29

Contributions invested in the Company Stock Fund and direct that an equivalent amount be reinvested in any other Investment Fund as designated by the Participant.
(c)    The Plan shall offer at least three (3) Investment Funds, other than the Company Stock Fund, each of which shall have materially different risk and return characteristics.
(d)    The Plan shall allow a Participant to divest any investment in the Company Stock Fund at least quarterly.

30

ARTICLE IX 
 
MAINTENANCE AND VALUATION OF PARTICIPANTS’ ACCOUNTS
9.1    Establishment of Accounts.
(a)    An Account shall be established for each Participant.  In addition, subaccounts shall be established for each Participant to reflect all Elective Employer Contributions, Roth Contributions, Voluntary Participant Contributions, Employer Matching Contributions, Rollover Contributions, rollover of Roth Contributions and such other Accounts as may be necessary to hold contribution types necessary or desirable to manage amounts merged into the Plan including those set forth in Sections 9.1(b) - (f) below (and the earnings and/or losses on each subaccount).  Each Participant will be furnished a statement of his Account at least annually and upon any distribution.
(b)    The Administrative Committee shall also establish a subaccount known as a Participant’s SEPCO Transferred Account to reflect the Participant’s interest in the Plan resulting from the merger of the SEPCO Plan into this Plan effective as of January 1, 1993.  To the extent that a Participant’s Salary Deferral Account, Employer Contribution Account, and Rollover Account (as those terms were defined under the SEPCO Plan), were transferred to this Plan from the SEPCO Plan, such accounts shall retain their character as participant deferral, employer, or rollover contributions, respectively, and the Administrative Committee shall establish and maintain such bookkeeping accounts as it deems necessary to account for such contributions, and any subsequent earnings or losses attributable thereto, under this Plan.
(c)    Upon the merger of the Performance Sharing Plan into this Plan effective as of June 21, 2002, a Participant’s interest in the Performance Sharing Plan which is transferred to this Plan shall be added to the Participant’s Employer Matching Contributions subaccount and shall be treated as Employer Matching Contributions under the Plan.  In the event a Participant for whom amounts were transferred from the Performance Sharing Plan did not have an Account under this Plan prior to such transfer, an Employer Matching Contributions subaccount shall be established for such Participant.  Except as otherwise determined by the Administrative Committee, the investment elections in effect under the Performance Sharing Plan at the time amounts are transferred to this Plan shall continue to apply to such amounts under this Plan, and Participants may thereafter direct the investment of such amounts in accordance with Article VIII.
(d)    Upon the merger of the Employee Stock Ownership Plan into this Plan, a Participant’s interest in the Employee Stock Ownership Plan which is transferred to this Plan shall be added to the Participant’s Employer Matching Contributions subaccount and shall be treated as Employer Matching Contributions under the Plan.  In the event a Participant for whom amounts were transferred from the Employee Stock Ownership Plan did not have an Account under this Plan prior to such transfer, an Employer Matching Contributions subaccount shall be established for such Participant.  The portion of a Participant’s Account attributable to amounts transferred from the Employee Stock 

31

Ownership Plan initially shall be invested in the Company Stock Fund.  Participants may thereafter direct the investment of such amounts in accordance with Article VIII.
(e)    Pursuant to the terms of the Plan of Reorganization, certain equity holders in Mirant may share in Designated Net Litigation Distributions, as described in Section 10.13 of the Plan of Reorganization.  The Administrative Committee shall establish recordkeeping accounts to reflect a Participant’s interest in any Designated Net Litigation Distributions that may be received by the Plan.  Upon receipt by the Plan of any Designated Net Litigation Distributions, the Administrative Committee shall establish a subaccount known as the “Mirant Litigation Distribution Account” to reflect the Participant’s interest in the Designated Net Litigation Distributions.  In the event Designated Net Litigation Distributions are received by the Plan with respect to any former Participant for whom an Account is no longer maintained, the Administrative Committee shall establish a new Account for such Participant which shall be comprised solely of his Mirant Litigation Distribution Account.
9.2    Valuation of Investment Funds.  Except as provided in Section 12.12 of the Plan, a Participant’s Account in respect of his interest in each Investment Fund shall be credited or charged, as the case may be, as of each Valuation Date with the dividends, income, gains, appreciation, losses, depreciation, forfeitures, expenses, and other transactions with respect to such Investment Fund for the Valuation Date as of which such credit or charge accrued.  Such credits or charges to a Participant’s Account shall be made in such proportions and by such method or formula as shall be deemed by the Administrative Committee to be necessary or appropriate to account for each Participant’s proportionate beneficial interest in the Trust Fund in respect of his interest in each Investment Fund.  Investments of each Investment Fund shall be valued at their fair market values as of each Valuation Date as determined by the Trustee, and such valuation shall conclusively establish such value.
9.3    Rights in Investment Funds.  Nothing contained in this Article IX shall be deemed to give any Participant any interest in any specific property in any Investment Fund or any interest, other than the right to receive payments or distributions in accordance with the Plan or the right to instruct the Trustee how to vote Common Stock as provided in Section 14.3.

32

ARTICLE X 
 
VESTING
10.1    Vesting.  
(a)    Subject to paragraphs (b) and (c) below and certain exceptions set forth in Appendix B, the amount to the credit of a Participant’s Account shall at all times be fully vested and nonforfeitable.
(b)    Subject to Appendix B, upon the merger of the AGL RSP Plan and Nicor Thrift Plan into this Plan, Participants having an AGL RSP Plan account and/or  a Nicor Thrift Plan account shall be fully vested in such Account(s) upon earning one Hour of Service for an Employing Company on or after January 1, 2018.
(c)    With respect to any Participant having an AGL RSP account and/or a Nicor Thrift Plan account, who does not have, at least, one Hour of Service on or after January 1, 2018, the vesting of such Participant’s Account will be determined in accordance with the terms of the AGL RSP Plan or the Nicor Thrift Plan, as applicable, as in effect when they terminated employment.

33

ARTICLE XI 
 
WITHDRAWALS AND LOANS
11.1    Withdrawals by Participants.
(a)    Subject to the provisions of Article XII, this Section 11.1, and Sections 11.2 through 11.5, a Participant may make withdrawals from his Account effective as of any Valuation Date in the order of priority listed below except as set forth in Section 11.5(b):
(1)    All or a portion of the value of his Account attributable to Voluntary Participant Contributions (not including any earnings or appreciation thereon) made prior to January 1, 1987;
(2)    All amounts described above, plus all or a portion of the value of his Account attributable to Voluntary Participant Contributions, plus a ratable portion of the earnings and/or appreciation on Voluntary Participant Contributions;
(3)    All amounts described above, plus effective April 1, 1997, all or a portion of the value of his Account attributable to Rollover Contributions (including earnings and appreciation thereon);
(4)    All amounts described above, plus all or a portion of the value of his Account attributable to his Employer Matching Contributions (including earnings and appreciation thereon) allocated to his Account; provided, however, that such Participant shall have participated in the Plan for sixty (60) months or more at the time of the withdrawal unless such Participant already attained age 59 1⁄2 at the time of the withdrawal request in which case the sixty (60) month service requirement becomes inapplicable;
(5)    (A)    For Participants who have not attained age 591⁄2 or severed from employment with the Affiliated Employers (within the meaning of Code Section 401(k)(2)(B)(i)(I)), all amounts described above, plus all or a portion of the value of his Account attributable to Elective Employer Contributions (not including any earnings or appreciation thereon for Plan Years beginning after December 31, 1988); and
(B)    For Participants who have attained age 591⁄2 or severed from employment with the Affiliated Employers (within the meaning of Code Section 401(k)(2)(B)(i)(I)), all amounts described above, plus all or a portion of the value of his Account attributable to any earnings or appreciation on Elective Employer Contributions.
(6)    For Participants who have attained age 591⁄2 or severed from employment with the Affiliated Employers (within the meaning of Code Section 401(k)(2)(B)(i)(l)), all amounts described above, plus all or a portion of the value 

34

of his Account attributable to Retirement Growth Contributions, including any earnings or appreciation thereon.
(7)    (A)    For Participants who have not attained age 591⁄2 or severed from employment with the Affiliated Employers (within the meaning of Code Section 401(k)(2)(B)(i)(I)), all amounts described above, plus all or a portion of the value of his Account attributable to Roth Contributions (not including any earnings or appreciation thereon for Plan Years beginning after December 31, 1988); and
(B)    For Participants who have attained age 591⁄2 or severed from employment with the Affiliated Employers (within the meaning of Code Section 401(k)(2)(B)(i)(I)), all amounts described above, plus all or a portion of the value of his Account attributable to any earnings or appreciation on Roth Contributions.
For purposes of applying Section 11.1(a)(4), any Participant who has an interest in his Employer Matching Contributions subaccount attributable to an amount transferred from the Employee Stock Ownership Plan shall be treated as first participating in this Plan as of the earlier of the date such individual began participating in the Employee Stock Ownership Plan or the date he began participating in this Plan.
For Participants who have a Nicor Thrift Plan account, amounts in the Retirement Growth Contribution subaccount and/or the 2010 Nicor Account, respectively, may also be withdrawn for purposes of a hardship event under Section 11.5 in this same order after exhausting the amounts provided in Section 11.1(a)(5) and before receiving any amounts provided in Section 11.1(a)(6).
(b)    Notwithstanding the foregoing, a Participant who is eligible for a “qualified distribution” as defined in Code Section 402A(d) may withdraw all or a portion of only his Roth Contributions subaccount effective as of a Valuation Date without regard to the requirement set forth in Section 11(a)(1)-(6).
11.2    Notice of Withdrawal.  Notice of withdrawal must be given by a Participant in accordance with the procedures established by the Administrative Committee, and if such withdrawal would constitute an eligible rollover distribution (within the meaning of Code Section 402(c)(4)), the consent and notice requirements of Section 12.9 must be satisfied.  Payment of a withdrawal shall be made as soon as practicable and in accordance with Section 12.10, if applicable.
11.3    Form of Withdrawal.  All distributions under this Article XI shall be made in the form of cash, provided that with respect to any distribution which is attributable to Common Stock, the Participant shall have the right to demand that such portion of the distribution be made in the form of Common Stock to the extent of the whole number of shares of Common Stock in his Account.  Such demand must be made in accordance with the procedures established by the Administrative Committee.

35

11.4    Source of Withdrawal.
(a)    Withdrawals shall be made in accordance with the instructions of the Participant from each of the Investment Funds in which the amount to be distributed is invested.  The value of the amount to be distributed under any option listed in Section 11.1 shall be determined as soon as practicable in accordance with the procedures established by the Administrative Committee.
(b)    Notwithstanding (a) above, subject to the requirements of Section 11.5, a Participant may make a specific withdrawal of only amounts described in Section 11.1(a)(6)(A) and (B) if made in accordance with procedures established by the Administrative Committee.  The value of the amount to be distributed under this Section 11.4(b) shall be determined as soon as practicable in accordance with the procedures established by the Administrative Committee.
11.5    Requirement of Hardship.
(a)    Except as provided in (e) below, a withdrawal pursuant to Section 11.1(a)(5)(A) and/or Section 11.1(a)(6)(A), in addition to the other requirements of Article XI, shall be permitted only if the Administrative Committee determines that the withdrawal is to be made on account of an immediate and heavy financial need of the Participant, the amount of the withdrawal does not exceed such financial need, and the amount of the withdrawal is not reasonably available from other resources of the Participant.
(b)    For purposes of this Section 11.5, the following shall be deemed to be immediate and heavy financial needs:
(1)    Expenses for (or necessary to obtain) medical care that would be deductible under Code Section 213(d) (determined without regard to whether the expenses exceed 7.5% of adjusted gross income); including but not limited to, expenses for
(A)    the diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body; or
(B)    transportation primarily for and essential to such expenses referred to in (i) above; or
(C)    insurance (including amounts paid as premiums under part B of Title XVIII of the Social Security Act) relating to medical expenses referred to in (i) or (ii) above, provided such expenses are incurred by the Participant, the Participant’s spouse or dependent (as defined in Code Section 152 without regard to subsections (b)(1), (b)(2) and (d)(1)(B) on or after January 1, 2006), or are necessary for such persons to obtain the medical care described above; or

36

(2)    Purchase (excluding mortgage payments) of a principal residence for the Participant; or
(3)    Payment of tuition, related educational fees, and room and board expenses, for the next twelve (12) months of post-secondary education for the Participant, the Participant’s spouse, child or children, or dependent (as defined in Code Section 152 without regard to subsections (b)(1), (b)(2) and (d)(1)(B)); or
(4)    The need to prevent eviction of the Participant from his principal residence or foreclosure on the mortgage of the Participant’s principal residence; or
(5)    Payment of burial or funeral expenses for the Participant’s deceased parent, spouse, child or dependent (as defined in Code Section 152 without regard to subsection (d)(1)(B)); or
(6)    Payment of expenses for the repair of damage to the Participant’s principal residence that would qualify for a casualty deduction under Code Section 165 (determined without regard to whether the loss exceeds 10% of adjusted gross income); or
(7)    Any other need which the Commissioner of the Internal Revenue Service, through the publication of revenue rulings, notices, or other documents of general applicability, deems to be immediate and heavy.
(c)    For purposes of this Section 11.5, a withdrawal shall be deemed necessary to satisfy an immediate and heavy financial need if:
(1)    The distribution is not in excess of the amount of the immediate and heavy financial need of the Participant, including any amounts necessary to pay any federal, state, or local income taxes or penalties reasonably anticipated to result from the distribution;
(2)    The Participant has obtained all distributions (including the distribution of Company Stock Fund dividends under Code Section 404(k), if any, in accordance with Section 12.12) and all nontaxable loans currently available to him under all plans maintained by an Affiliated Employer;
(3)    The Participant has utilized all financial resources including assets belonging to the Participant’s spouse and minor children that are reasonably available to the Participant; and
(4)    The Participant agrees to suspend all Elective Employer Contributions, Roth Contributions, and/or Voluntary Participant Contributions to all plans of an Affiliated Employer for at least six (6) months after receipt of the distribution under this Section 11.5.

37

(d)    When all suspensions pursuant to this Section 11.5 are ended, Elective Employer Contributions, Roth Contributions, and/or Voluntary Participant Contributions may be resumed by the Participant (if the Participant is then eligible and elects to resume such contributions) beginning with the Participant’s first payroll period commencing after all suspensions are ended, and Employer Matching Contributions by his Employing Company also shall be resumed.  There shall be no make up of any contributions by a Participant or by an Employing Company with respect to a period of suspension.
(e)    Notwithstanding (a) above, if a Participant has attained age 591⁄2 or severed from employment with the Affiliated Employers (within the meaning of Code Section 401(k)(2)(B)(i)(I)), he shall be permitted to make a withdrawal pursuant to Sections 11.1(a)(5)(A) and 11.1(a)(6)(A), even if such withdrawal is not on account of hardship.
11.6    Loans to Participants.
(a)    The Administrative Committee may, in its sole discretion, direct the Trustee to make a loan or loans from the Trust Fund to any Participant (other than a Participant with an existing Plan loan in arrears) (1) who is an Employee on the active payroll of an Employing Company, (2) who is receiving long-term disability payments under a plan maintained by his Employing Company, (3) who is on a leave of absence authorized by his Employing Company, or (4) who is a party in interest as defined in Section 3(14) of ERISA.  All loan applications shall be made in accordance with the procedures established by the Administrative Committee, which shall form a part of this Plan.  Such procedures shall establish the terms and conditions of loans under the Plan, including the events constituting default, and shall be consistent with the provisions of this Section 11.6.
(b)    The total amount of all loans outstanding to any one Participant under all qualified plans maintained by an Affiliated Employer shall not exceed the lesser of (1) $50,000, reduced by the excess of the highest outstanding balance of loans from all qualified plans maintained by an Affiliated Employer during the twelve-month period ending on the day before a loan is made, over the outstanding balance of any loans to the Participant from all qualified plans maintained by an Affiliated Employer on the date the loan is made, or (2) fifty percent (50%) of such Participant’s Account as of the Valuation Date coinciding with or next following the date the loan application is made.  The minimum amount of any loan shall not equal less than $1,000.
(c)    The principal amount of a loan shall be obtained pro rata from each Investment Fund in which the Participant’s Account is invested at that time such loan is obtained.
(d)    The Administrative Committee shall adopt and follow uniform and nondiscriminatory procedures in making loans under this Plan to make certain that such loans (1) are available to all Participants on a reasonably equivalent basis, (2) are not made available to Highly Compensated Employees, officers, or shareholders in an amount greater than the amount made available to other Participants, (3) bear a 

38

reasonable rate of interest, and (4) are adequately secured.  The repayment of such loans by any Participant who is an Employee on the active payroll of an Employing Company shall be made through payroll deduction.  The minimum amount of any loan repayment shall not equal less than $20.00, and such repayment shall extend for a period certain of at least twelve (12) months (unless repaid in full), but not to exceed fifty-eight (58) months, expressed in any number of whole months (including the month the loan is made).  The term of any loan may be for a period certain of more than fifty-eight (58) months, but not to exceed fifteen (15) years, only if the proceeds of such loan are used to acquire any dwelling used or, within a reasonable period of time, to be used as the principal residence of the Participant.
(e)    The Administrative Committee shall direct the Trustee to obtain from the Participant such note and adequate security as it may require.  All loans made pursuant to this Section 11.6 shall be secured by the Participant’s Account, and no other types of collateral may be used to secure a loan from the Plan.  Notwithstanding the provisions of Section 17.2, if a Participant defaults on a loan under the Plan or if the Participant’s employment terminates prior to full repayment thereof, in addition to any other remedy provided in the loan instruments or by law, the Administrative Committee may direct the Trustee to charge against that portion of the Participant’s Account which secures the loan the amount required to fully repay the loan.  Under no circumstances, however, shall any unpaid loan be charged against a Participant’s Account until permitted by applicable law.  This Section 11.6 authorizes only the making of bona fide loans and not distributions, and before resort is made against a Participant’s Account for his failure to repay any loan, such other reasonable efforts to collect the same shall be made by the Administrative Committee as it deems reasonable and practical under the circumstances.
(f)    No distribution shall be made to any Participant unless and until all unpaid loans to such Participant have either been paid in full or deducted from the Participant’s Account.
(g)    All loans made under this Section 11.6 shall be considered earmarked investments of the Participant’s Account, and any repayment of principal and interest shall be reinvested in accordance with the Participant’s investment direction in effect on the date of such repayment pursuant to Article VIII of the Plan.

39

ARTICLE XII
 
DISTRIBUTION TO PARTICIPANTS
12.1    Distribution upon Termination of Employment.
(a)    In addition to the withdrawal options under Section 11.1, upon the Participant’s severance from employment, the entire balance credited to his Account shall be payable to such Participant in the manner set forth in this Section 12.1 at such time requested by the Participant pursuant to Section 12.5 and in accordance with the procedures established by the Administrative Committee.  The distribution shall commence as soon as practicable after the Valuation Date selected by the Participant in one of the following ways:
(1)    In a partial lump sum, provided that, the Participant has not already commenced payment in a form provided in paragraph (2) or (3) below;
(2)    In a single lump-sum distribution;
(3)    In monthly, quarterly or annual installments not to exceed the Participant’s life expectancy.  Such installments may be determined based on a set amount or a set period with time.  The amount of cash and/or the number of shares of Common Stock in each installment shall be equal to the proportionate value as of each Valuation Date immediately preceding payment of the balance then to the credit of the Participant in his Account determined by dividing the amount credited to his Account as of such Valuation Date by the number of payments remaining to be made.
A Participant who is receiving installment payments may modify the time of payment of some or all of the remaining installments by making a subsequent election in accordance with procedures established by the Administrative Committee or its delegate.  If a Participant dies before receiving all of the amount to the credit of his Account in accordance with this paragraph (3), the amount remaining to the credit of his Account at his death shall be distributed to his Beneficiary in accordance with Section 12.4; or
(4)    A Participant may elect to defer the commencement of the distribution of his Account following the termination of his employment until a later Valuation Date, provided that, such distribution shall commence not later than the date required under Section 12.5 of the Plan.  Any deferred distribution shall be made in a form permitted under this Section 12.1 and commence as soon as practicable after the Valuation Date selected by the Participant.
(b)    Notwithstanding a Participant’s election under paragraph (a) above, the Administrative Committee shall direct payment in a single lump sum to such Participant if the balance of his Account does not exceed $5,000 in accordance with the requirements of Code Section 411(a)(11) and subject to Section 12.8.  The Administrative Committee 

40

shall not cash-out any Participant whose Account balance exceeds $5,000 without the written consent of the Participant.
12.2    Distribution upon Disability.  If a Participant’s employment with the Affiliated Employers is terminated prior to his Normal Retirement Date by reason of his Disability, such disabled Participant, in addition to the withdrawal options under Section 11.1, shall be entitled to receive the entire value credited to his Account at such time as requested by the Participant or such legal representative pursuant to Section 12.5 and in accordance with the procedures established by the Administrative Committee.  Any distribution pursuant to this Section 12.2 shall be made in a single lump sum as soon as practicable after the selected Valuation Date.
Notwithstanding the foregoing, the Administrative Committee shall direct payment in a single lump sum to such Participant or his legal representative if the balance of such Participant’s Account does not exceed $5,000 in accordance with the requirements of Code Section 411(a)(11) and subject to Section 12.8.
12.3    Distribution upon Death.  If a Participant dies before he has received a complete distribution of his Account in accordance with this Article XII, the entire balance credited to the Participant’s Account shall be distributed to the Participant’s surviving Beneficiary or Beneficiaries at her or their election in a form permitted in Section 12.1 in accordance with the procedures established by the Administrative Committee commencing not later than the date required in Section 12.5 of the Plan, provided that, (a) with respect to a Surviving Spouse, the form and timing of such distribution must satisfy the requirements of Section 12.5(d) and (b) with respect to all other Beneficiaries, the distribution elected in accordance with Section 12.1 must be completed by the fifth (5th) anniversary of the Participant’s death provided that, if a distribution to such Beneficiary meeting the requirements of Section 12.5 commenced within the one-year period following the Participant’s death, the five-year requirement can be ignored and payments that satisfy Section 12.5 may continue to be made to such Beneficiary. Notwithstanding the foregoing, the Administrative Committee shall direct payment in a single lump sum to any such Beneficiary or her legal representative if the balance of such Participant’s Account does not exceed $5,000 in accordance with the requirements of Code Section 411(a)(11) and subject to Section 12.8.
12.4    Designation of Beneficiary in the Event of Death.  A Participant may designate a Beneficiary or Beneficiaries (who may be designated contingently) to receive all or part of the amount credited to his Account in case of his death before his receipt of all of his benefits under the Plan, provided that the Beneficiary of a married Participant shall be the Participant’s Surviving Spouse, unless such Surviving Spouse shall consent in a writing witnessed by a notary public, which writing acknowledges the effect of the Participant’s designation of a Beneficiary other than such Surviving Spouse.  However, if such Participant establishes to the satisfaction of the Administrative Committee that such written consent may not be obtained because the Surviving Spouse cannot be located or because of such other circumstances as the Secretary of the Treasury may by regulations prescribe, a designation by such Participant without the consent of the Surviving Spouse shall be valid.

41

Any consent necessary under this Section 12.4 shall be valid and effective only with respect to the Surviving Spouse who signs the consent or, in the event of a deemed consent, only with respect to a designated Surviving Spouse.
A designation of Beneficiary may be revoked by the Participant without the consent of any Beneficiary (or the Participant’s Surviving Spouse) at any time before the commencement of the distribution of benefits.  A Beneficiary designation or change or revocation of a Beneficiary designation shall be made in accordance with the procedures established by the Administrative Committee.
If no designated Beneficiary shall be living at the death of the Participant and/or such Participant’s Beneficiary designation is not valid and enforceable under applicable law or the procedures of the Administrative Committee, such Participant’s Beneficiary or Beneficiaries shall be the person or persons in the first of the following classes of successive preference, if then living:
(a)    the Participant’s spouse on the date of his death,
(b)    the Participant’s children, equally,
(c)    the Participant’s parents, equally,
(d)    the Participant’s brothers and sisters, equally, or
(e)    the Participant’s executors or administrators.
Notwithstanding the foregoing, a deceased Participant who had an AGL RSP Plan account or a Nicor Thrift Plan account who died prior to January 1, 2017 without having an effective beneficiary designation on file with the Administrative Committee shall be deemed to have designated his Surviving Spouse, if living, and if not, his estate.
Payment to such one or more persons shall completely discharge the Plan and the Trustee with respect to the amount so paid.
12.5    Required Minimum Distributions.
(a)    General Rules.
(1)    Notwithstanding the other provisions in this Article XII, the requirements of this Section 12.5 shall apply to any distribution of a Participant’s or Beneficiary’s interest and will take precedence over any inconsistent provisions of this Plan.  Unless otherwise specified, the provisions of this Article apply to calendar years beginning after December 31, 2002.
(2)    All distributions required under this Article shall be determined and made in accordance with the regulations under Code Section 401(a)(9) and the minimum distribution incidental benefit requirement of Code Section 401(a)(9)(G).

42

(3)    Limits on Distribution Periods.  As of the first distribution calendar year, distributions to a Participant, if not made in a single-sum, may only be made over one of the following periods:
(A)    the life of the Participant,
(B)    the joint lives of the Participant and a Designated Beneficiary,
(C)    a period certain not extending beyond the life expectancy of the Participant, or
(D)    a period certain not extending beyond the joint life and last survivor expectancy of the Participant and a Designated Beneficiary.
(4)    TEFRA Section 242(b)(2) Elections.  Notwithstanding the other provisions of this Section 12.5, distributions may be made under a designation made before January 1, 1984, in accordance with Section 242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA).
(b)    Time and Manner of Distribution.
(1)    Required Beginning Date.  The Participant’s entire interest will be distributed, or begin to be distributed, to the Participant no later than the Participant’s Required Beginning Date.
(2)    Death of Participant Before Distributions Begin.  If the Participant dies before the distributions begin, the Participant’s entire interest will be distributed, or begin to be distributed, no later than as follows:
(A)    If the Participant’s surviving Spouse is the Participant’s sole Designated Pre-Retirement Beneficiary, then, except as otherwise elected under Section 12.5(f), distributions to the surviving Spouse will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died, or by December 31 of the calendar year in which the Participant would have attained age 701⁄2, if later.
(B)    If the Participant’s surviving Spouse is not the Participant’s sole Designated Beneficiary, then, except as otherwise elected under Section 12.5(f), distributions to the Designated Beneficiary will begin by December 31 of the calendar year immediately following the calendar year in which the Participant died.
(C)    If there is no Designated Beneficiary as of September 30 of the year following the year of the Participant’s death, the Participant’s entire interest will be distributed by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.

43

(D)    If the Participant’s surviving Spouse is the Participant’s sole Designated Beneficiary and the surviving Spouse dies after the Participant but before distributions to the surviving Spouse begin, this Section 12.5(b)(2), other than Section 12.5(b)(2)(A), will apply as if the surviving Spouse were the Participant.
For purposes of this Section 12.5(b)(2) and Section 12.5(d), unless Section 12.5(b)(2)(D) applies, distributions are considered to begin on the Participant’s Required Beginning Date.  If Section 12.5(b)(2)(D) applies, distributions are considered to begin on the date distributions are required to begin to the surviving Spouse under Section 12.5(b)(2)(A), if applicable.  If distributions under an annuity purchased from an insurance company irrevocably commence to the Participant before the Participant’s Required Beginning Date (or to the Participant’s surviving Spouse before the date distributions required to begin to the surviving Spouse under Section 12.5(b)(2)(A)), the date distributions are considered to begin is the date distributions actually commence.
(3)    Forms of Distribution.  Unless the Participant’s interest is distributed in the form of an annuity purchased from an insurance company or in a single sum on or before the Required Beginning Date, as of the first distribution calendar year distributions will be made in accordance with Section 12.5(c) and (d), if applicable.  If the Participant’s interest is distributed in the form of an annuity purchased from an insurance company, distributions thereunder will be made in accordance with the requirements of Section 401(a)(9) of the Code and the Treasury Regulations.
(c)    Required Minimum Distributions during Participant’s Lifetime.
(1)    Amount of Required Minimum Distribution for Each Distribution Calendar Year.  During the Participant’s lifetime, the minimum amount that will be distributed for each distribution calendar year is the lesser of:
(A)    The quotient obtained by dividing the Participant’s Account balance by the distribution period in the Uniform Lifetime Table set forth in Section 1.401(a)(9)-9, Q&A-2 of the Treasury Regulations, using the Participant’s age as of the Participant’s birthday in the distribution calendar year; or
(B)    If the Participant’s sole Designated Beneficiary for the distribution calendar year is the Participant’s Spouse, the quotient obtained by dividing the Participant’s Account balance by the number in the Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9, Q&A-3 of the Treasury Regulations, using the Participant’s and Spouse’s attained ages as of the Participant’s and Spouse’s birthdays in the distribution calendar year.
(2)    Lifetime Required Minimum Distributions Continue through Year of Participant’s Death.  Required minimum distributions will be determined under 

44

this Section 12.5(c) beginning with the first distribution calendar year and up to and including the distribution calendar year that includes the Participant’s date of death.
(d)    Required Minimum Distributions after Participant’s Death.
(1)    Death On or After Date Distributions Begin.
(A)    Participant Survived by Designated Beneficiary.  If the Participant dies on or after the date distributions begin and there is a Designated Beneficiary, the minimum amount that will be distributed for each distribution calendar year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account balance by the longer of the remaining life expectancy of the Participant or the remaining life expectancy of the Participant’s Designated Beneficiary, determined as follows:
(I)    The Participant’s remaining life expectancy is calculated using the age of the Participant in the year of death, reduced by one for each subsequent year.
(II)    If the Participant’s surviving Spouse is the Participant’s sole Designated Beneficiary, the remaining life expectancy of the surviving Spouse is calculated for each distribution calendar year after the year of the Participant’s death using the surviving Spouse’s age as of the Spouse’s birthday in that year.  For distribution calendar years after the year of the surviving Spouse’s death, the remaining life expectancy of the surviving Spouse is calculated using the age of the surviving Spouse as of the Spouse’s birthday in the calendar year of the Spouse’s death, reduced by one for each subsequent calendar year.
(III)    If the Participant’s surviving Spouse is not the Participant’s sole Designated Beneficiary, the Designated Beneficiary’s remaining life expectancy is calculated using the age of the Beneficiary in the year following the year of the Participant’s death, reduced by one for each subsequent year.
(B)    No Designated Beneficiary.  If the Participant dies on or after the date distributions begin and there is no Designated Beneficiary as of September 30 of the year after the year of the Participant’s death, the minimum amount that will be distributed for each distribution calendar year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account balance by the Participant’s remaining life expectancy calculated using the age of the Participant in the year of death, reduced by one for each subsequent year.

45

(2)    Death before Date Distributions Begin.
(A)    Participant Survived by Designated Beneficiary.  Except as otherwise elected under Section 12.5(f), if the Participant dies before the date distributions begin and there is a Designated Beneficiary, the minimum amount that will be distributed for each distribution calendar year after the year of the Participant’s death is the quotient obtained by dividing the Participant’s Account balance by the remaining life expectancy of the Participant’s Designated Beneficiary, determined as provided in Section 12.5(d)(1).
(B)    No Designated Beneficiary.  If the Participant dies before the date distributions begin and there is no Designated Beneficiary as of September 30 of the year following the year of the Participant’s death, distribution of the Participant’s entire interest will be completed by December 31 of the calendar year containing the fifth anniversary of the Participant’s death.
(C)    Death of Surviving Spouse Before Distributions to Surviving Spouse Are Required to Begin.  If the Participant dies before the date distributions begin, the Participant’s surviving Spouse is the Participant’s sole Designated Beneficiary, and the surviving Spouse dies before distributions are required to begin to the surviving Spouse under Section 12.5(b)(2)(A), this Section 12.5(d)(2) will apply as if the surviving Spouse were the Participant.
(e)    Definitions.
(1)    Designated Beneficiary.  The individual who is designated as the “beneficiary” under the terms of the Plan and is the “Designated Beneficiary” under Section 401(a)(9) of the Code and Section 1.401(a) (9)-4 of the Treasury Regulations.
(2)    Distribution calendar year.  A calendar year for which a minimum distribution is required.  For distributions beginning before the Participant’s death, the first distribution calendar year is the calendar year immediately preceding the calendar year which contains the Participant’s Required Beginning Date.  For distributions beginning after the Participant’s death, the first distribution calendar year is the calendar year in which distributions are required to begin under Section 12.5(b)(2).  The required minimum distribution for the Participant’s first distribution calendar year will be made on or before the Participant’s Required Beginning Date.  The required minimum distribution for other distribution calendar years, including the required minimum distribution for the distribution calendar year in which the Participant’s Required Beginning Date occurs, will be made on or before December 31 of the distribution calendar year.

46

(3)    Life expectancy.  Life expectancy as computed by use of the Single Life Table in Section 1.401(a)(9)-9, Q&A-1 of the Treasury Regulations.
(4)    Participant’s Account balance.  The Account balance as of the last valuation date in the calendar year immediately preceding the distribution calendar year (valuation calendar year) increased by the amount of any contributions made and allocated or forfeitures allocated to the Account balance as of dates in the valuation calendar year after the valuation date and decreased by distributions made in the valuation calendar year after the valuation date.  The Account balance for the valuation calendar year includes any amounts rolled over or transferred to the Plan either in the valuation calendar year or in the distribution calendar year if distributed or transferred in the valuation calendar year.
(5)    Required Beginning Date.  The later of the April 1 of the calendar year following the calendar year in which the Participant attains age 701⁄2 or retires, except that distributions to a 5-percent owner must commence by the April 1 of the calendar year following the calendar year in which such Participant attains age 701⁄2.
(6)    5% Owner.  A Participant who is a 5-percent owner as defined in Code Section 416(i) (determined in accordance with Code Section 416 but without regard to whether the Plan is top heavy) at any time during the Plan Year ending with or within the calendar year in which he attains age 661⁄2, or any subsequent Plan Year.  Once distributions have begun to a 5-percent owner under this Section 12.5, they must continue, even if the Participant ceases to be a 5-percent owner in a subsequent year.
(f)    Participants or Beneficiaries May Elect 5-Year Rule.  Participants or Beneficiaries may elect on an individual basis whether the 5-year rule or the life expectancy rule in Sections 12.5(b)(2) and 12.5(d)(2) applies to distributions after the death of a Participant who has a Designated Beneficiary.  The election must be made no later than the earlier of September 30 of the calendar year in which distribution would be required to begin under Section 12.5(b)(2), or by September 30 of the calendar year which contains the fifth anniversary of the Participant’s (or, if applicable, the surviving Spouse’s) death.  If neither the Participant nor the Beneficiary makes an election under this paragraph (f), distributions will be made in accordance with Sections 12.5(b)(2) or 12.5(d)(2).
(g)    Modification of Required Minimum Distributions for 2009.  Notwithstanding (a)-(f) above, a Participant who would have been required to receive required minimum distributions for 2009 but for the enactment of Code Section 401(a)(9)(H) (“2009 RMDs”), and who would have satisfied that requirement by receiving distributions that are (1) equal to the 2009 RMDs or (2) one or more payments in a series of substantially equal distributions (that include the 2009 RMDs) made at least annually and expected to last for the life (of life expectancy) of the Participant, the joint lives (or joint life expectancy) of the Participant and the Participant’s designated beneficiary, or for a period of at least ten (10) years (“Extended 2009 RMDs”), will 

47

receive those distributions for 2009, unless the Participant chooses not to receive such distributions.  In a manner prescribed by the Administrative Committee, Participants described in the preceding sentence will be given the opportunity to elect to stop receiving the distributions described in the preceding sentence.
12.6    Transfer between Employing Companies.  A transfer by a Participant from one Employing Company to another Employing Company shall not affect his participation in the Plan.  A transfer by a Participant from an Employing Company to an Affiliated Employer that is not an Employing Company shall not be deemed to be a termination of employment with an Employing Company.
12.7    Distributions to Alternate Payees.  If the Participant’s Account under the Plan shall become subject to any domestic relations order which is a qualified domestic relations order satisfying the requirements of Code Section 414(p) and the Administrative Committee has notified the Participant and the alternate payee that the domestic relations order is so qualified under Code Section 414(p), such distribution to an alternate payee shall be made in accordance with the terms of the qualified domestic relations order to the extent permitted under Article XI or Article XII of the Plan.
12.8    Requirement for Direct Rollovers.
(a)    Direct Rollover.  Notwithstanding any provision of the Plan to the contrary that would otherwise limit a Distributee’s election under this Article XII, a Distributee may elect, at the time and in the manner prescribed by the Administrative Committee, to have any portion of an Eligible Rollover Distribution paid directly to an Eligible Retirement Plan specified by the Distributee in a Direct Rollover.
(b)    Automatic Rollover.  If a Distributee (1) fails to make an election in accordance with paragraph (a) above and does not elect to receive directly the balance to his credit (or portion thereof), and (2) such Distributee’s Eligible Rollover Distribution is in excess of $1,000 but less than or equal to $5,000 as determined in accordance with Section 12.1(b) of the Plan, the Eligible Rollover Distribution shall be rolled over to an “eligible retirement plan” within the meaning of Code Section 7701(a)(37) selected by the Administrative Committee and such rollover balance shall be subject to the rights and conditions set forth in a written agreement entered into by the Administrative Committee with the provider of such eligible retirement plan.  This subsection (b) is applicable to distributions made on or after March 28, 2005.  Notwithstanding the preceding, pursuant to the transition rule in Notice 2005‐5, Q&A-9, the Plan shall delay processing of automatic rollovers for the 2005 Plan Year under this subsection (b) because of insufficient administrative procedures for automatic rollovers to a date on or after October 6, 2005 but before the end of the Plan Year.
(c)    Roth Contributions.  Notwithstanding (a) and (b) above, a Direct Rollover of a distribution from a Roth Contributions subaccount will only be made to another designated Roth account (as defined in Code Section 402A) under an applicable retirement plan described in Code Section 402A(e)(1) or to a Roth IRA described in Code Section 408A and only to the extent the rollover is permitted under the rules of Code 

48

Section 402A(c).  The provisions of (a) and (b) above that allow a Participant to elect a Direct Rollover of only a portion of an Eligible Rollover Distribution shall be applied by treating any amount distributed from the Participant’s Roth Contributions subaccount as a separate distribution from any amount distributed from the rest of the Participant’s Account, even if the amounts are distributed at the same time.
12.9    Consent and Notice Requirements.  If the value of the vested portion of a Participant’s Account derived from Employing Company and Employee contributions exceeds $5,000 determined in accordance with the requirements of Code Section 411(a)(11), the Participant must consent to any distribution of such vested account balance prior to his Normal Retirement Date.  The consent of the Participant shall be obtained within the ninety-day period ending on the first day of the first period for which an amount is payable as an annuity or in any other form under this Plan.
The Administrative Committee shall notify the Participant of the right to defer any distribution until the Participant’s Account balance is no longer immediately distributable.  Such notification shall include a general description of the material features and an explanation of the relative values of the operational forms of benefit available under the Plan in a manner that would satisfy the notice requirements of Code Section 417(a)(3); such notification shall be provided no less than 30 days and no more than 90 days prior to the annuity starting date (or, for Plan Years beginning on or after January 1, 2007, no more than 180 days prior to the annuity starting date).
Distributions may commence less than 30 days after the notice required under Section 1.411(a)-11(c) of the Treasury Regulations is given, provided that:
(a)    the Administrative Committee 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 a particular distribution option, and
(b)    the Participant, after receiving the notice, affirmatively elects a distribution.
12.10    Form of Payment.  All distributions under this Article XII shall be made in the form of cash, provided that the person entitled to such distribution may demand that the portion of any distribution which is attributable to Common Stock be distributed in the form of such Common Stock to the extent of the whole number of shares in the Participant’s Account, with a cash adjustment for any fractional shares.
12.11    [Reserved].
12.12    Distribution of Dividends Payable on Common Stock.  Each Participant may elect whether (i) to receive a cash distribution of all or a portion of the dividends payable on the shares of Common Stock credited to the Participant’s Account as of the record date of the Common Stock or (ii) to have such dividends paid to the Plan and reinvested in Common Stock credited to the Participant’s Account.  The election of a Participant whether to receive a cash distribution of dividends shall remain in effect until such election is changed by the Participant.  In the event a Participant fails to make an election with respect to the dividends payable on any shares of 

49

Common Stock credited to the Participant’s Account, such Participant shall be deemed to have elected to have the dividends payable on such shares paid to the Plan and reinvested in Common Stock credited to the Participant’s Account.  Upon the death of a Participant, such Participant shall be deemed to have elected to have the dividends payable on all shares of Common Stock credited to the Participant’s Account reinvested in Common Stock, notwithstanding any election in effect at the time of the Participant’s death.
A Participant may change his election whether to receive a cash distribution of dividends during the first month of each calendar quarter.  However, with respect to each dividend on Common Stock, the election, or deemed election, of a Participant which is in effect on the last day of the first month in the calendar quarter which includes the record date for such dividend (the “Election Deadline”) shall apply with respect to the dividends payable on the shares of Common Stock credited to the Participant’s Account on such record date.  In any event, all elections and deemed elections shall be irrevocable as of the Election Deadline.  Participants are 100% vested in dividends payable on Common Stock.  Payment of cash distributions under this Section 12.12 shall be made to the Plan and to Participants, as the case may be, as soon as administratively practicable following the payable date of the dividends.  The Administrative Committee may establish such administrative procedures as it deems necessary or appropriate to effect the elections under this Section 12.12.
Notwithstanding the foregoing provisions of this Section 12.12, a Participant who requests a hardship withdrawal pursuant to Section 11.5 must satisfy the requirements of Section 11.5(c)(2) by obtaining all distributions (including the distributions of Company Stock Fund dividends under Code Section 404(k), payable on the shares of Common Stock credited to the Participant’s Account at the time of the request, if any).  Accordingly, such Participant may not elect to have such dividends paid to the Plan and reinvested in Common Stock credited to the Participant’s Account.

50

ARTICLE XIII 
 
ADMINISTRATION OF THE PLAN
13.1    Membership of Administrative Committee.  The Plan shall be administered by the Benefits Administration Committee, the members of which shall be appointed from time to time by the Fiduciary Oversight Committee of the Board of Directors.  Under the terms of the Plan, the Benefits Administration Committee shall be referred to as the Administrative Committee as provided in Section 2.5.  The Administrative Committee shall govern itself in accordance with the terms of the Charter for the Benefits Administration Committee approved by the Fiduciary Oversight Committee of the Board.
13.2    Term.  Any person serving in one of the positions set forth in Section 13.1 shall be a member of the Administrative Committee for the period of time during which such individual serves as a member of the Benefits Administration Committee.  The composition of the Administrative Committee may be changed only by action of the Fiduciary Oversight Committee of the Board of Directors.
13.3    Transaction of Business.  The transaction of business by the Administrative Committee shall be accomplished in accordance with the Charter for the Benefits Administration Committee approved by the Fiduciary Oversight Committee of the Board.
13.4    Administrative Committee Responsibilities in General.  The Plan shall be administered by the Administrative Committee which shall have the discretionary authority, power, and the duty to take all actions and to make all decisions necessary or proper to carry out the Plan and to control and manage the operation and administration of the Plan.  The Administrative Committee shall have the discretion to interpret the Plan, including any ambiguities herein, and to determine the eligibility for benefits under the Plan in its sole discretion.  The determination of the Administrative Committee as to any question involving the general administration and interpretation of the Plan shall be final, conclusive, and binding on all persons, except as otherwise provided herein or by law, and may be relied upon by the Company, all Employing Companies, the Trustee, the Participants, and their Beneficiaries.  Any discretionary actions to be taken under the Plan by the Administrative Committee with respect to Employees and Participants or with respect to benefits shall be uniform in their nature and applicable to all persons similarly situated.  Benefits under the Plan shall be paid only if the Administrative Committee or its delegate determines in its discretion that such benefits are payable pursuant to administrative procedures established by the Administrative Committee.  Notwithstanding any provision in the Plan to the contrary, the Administrative Committee shall be authorized to take whatever actions it deems necessary or appropriate in its discretion to implement administrative procedures, including, but not limited to, suspending plan participation (to the extent permitted by applicable law) and suspending changes in investment directions and fund transfers, even though otherwise permitted or required under the Plan.
13.5    Administrative Committee and Pension Fund Investment Review Committee as Named Fiduciaries.  For the purpose of compliance with the provisions of ERISA but subject to the allocation of fiduciary responsibility to the Pension Fund Investment Review Committee pursuant to Section 13.13 concerning the carrying out of a funding policy and method for the 

51

Plan, the Administrative Committee shall be the administrator of the Plan as the term “administrator” is defined in ERISA, and the Administrative Committee shall be, with respect to the Plan, a named fiduciary as that term is defined in ERISA.  The Pension Fund Investment Review Committee shall be the named fiduciary with respect to those matters allocated to it under Section 13.13.  For the purpose of carrying out their duties, the Administrative Committee and the Pension Fund Investment Review Committee may, in each Committee’s respective discretion, allocate its responsibilities under the Plan among its members and may, in its discretion, designate persons (in writing or otherwise) other than members of its Committee to carry out such responsibilities allocated to it under the Plan as it may see fit.
13.6    Rules for Plan Administration.  The Administrative Committee may make and enforce rules and regulations for the administration of the Plan consistent with the provisions thereof and may prescribe the use of such forms or procedures as it shall deem appropriate for the administration of the Plan.
13.7    Employment of Agents.  The Administrative Committee may employ independent qualified public accountants, as such term is defined in ERISA, who may be accountants to The Southern Company and any Affiliated Employer, legal counsel who may be counsel to The Southern Company and any Affiliated Employer, other specialists, and other persons as the Administrative Committee deems necessary or desirable in connection with the administration of the Plan.  The Administrative Committee and any person to whom it may delegate any duty or power in connection with the administration of the Plan, the Company and the officers and directors thereof shall be entitled to rely conclusively upon and shall be fully protected in any action omitted, taken, or suffered by them in good faith in reliance upon any independent qualified public accountant, counsel, or other specialist, or other person selected by the Administrative Committee, or in reliance upon any tables, evaluations, certificates, opinions, or reports which shall be furnished by any of them or by the Trustee.
13.8    Co-Fiduciaries.  It is intended that to the maximum extent permitted by ERISA, each person who is a fiduciary (as that term is defined in ERISA) with respect to the Plan shall be responsible for the proper exercise of his own powers, duties, responsibilities, and obligations under the Plan and the Trust, as shall each person designated by any fiduciary to carry out any fiduciary responsibilities with respect to the Plan or the Trust.  No fiduciary or other person to whom fiduciary responsibilities are allocated shall be liable for any act or omission of any other fiduciary or of any other person delegated to carry out any fiduciary or other responsibility under the Plan or the Trust.
13.9    General Records.  The Administrative Committee shall maintain or cause to be maintained an Account (and any separate subaccount) which accurately reflects the interest of each Participant, as provided for in Section 9.1, and shall maintain or cause to be maintained all necessary books of account and records with respect to the administration of the Plan.  The Administrative Committee shall mail or cause to be mailed to Participants reports to be furnished to Participants in accordance with the Plan or as may be required by ERISA.  Any notices, reports, or statements to be given, furnished, made, or delivered to a Participant shall be deemed duly given, furnished, made, or delivered when addressed to the Participant and delivered to the Participant in person or mailed by ordinary mail to his address last communicated to the Administrative Committee (or its delegate) or of his Employing Company.

52

13.10    Liability of the Administrative Committee.  In administering the Plan, except as may be prohibited by ERISA, neither the Administrative Committee nor any person to whom it may delegate any duty or power in connection with administering the Plan shall be liable for any action or failure to act except for its or his own gross negligence or willful misconduct; nor for the payment of any amount under the Plan; nor for any mistake of judgment made by him or on his behalf as a member of the Administrative Committee; nor for any action, failure to act, or loss unless resulting from his own gross negligence or willful misconduct; nor for the neglect, omission, or wrongdoing of any other member of the Administrative Committee.  No member of the Administrative Committee shall be personally liable under any contract, agreement, bond, or other instrument made or executed by him or on his behalf as a member of the Administrative Committee.
13.11    Reimbursement of Expenses and Compensation of Administrative Committee.  Members of the Administrative Committee shall be reimbursed by the Company for expenses they may individually or collectively incur in the performance of their duties.  Each member of the Administrative Committee who is a full time employee of the Company or of any Employing Company shall serve without compensation for his services as such member; each other member of the Administrative Committee shall receive such compensation, if any, for his services as the Board of Directors may fix from time to time.
13.12    Expenses of Plan and Trust Fund.  The expenses of establishment and administration of the Plan and the Trust Fund, including all fees of the Trustee, auditors, and counsel, shall be paid by the Company or the Employing Companies.  Notwithstanding the foregoing, to the extent provided in the Trust Agreement, certain administrative expenses may be paid from the Trust Fund either directly or through reimbursement of the Company or the Employing Companies.  Any expenses directly related to the investments of the Trust Fund, such as stock transfer taxes, brokerage commissions, or other charges incurred in the acquisition or disposition of such investments, shall be paid from the Trust Fund (or from the particular Investment Fund to which such fees or expenses relate) and shall be deemed to be part of the cost of such securities or deducted in computing the proceeds therefrom, as the case may be.  Investment management fees for the Investment Funds shall be paid from the particular Investment Fund to which they relate.  In the event the Company or an Employing Company pays investment management fees directly, the Company or such Employing Company shall be reimbursed for such fees from the particular Investment Fund to which they relate, unless the Company or the Employing Company, as the case may be, elects not to be reimbursed for such expenses.  Taxes, if any, on any assets held or income received by the Trustee and transfer taxes on the transfer of Common Stock from the Trustee to a Participant or his Beneficiary shall be charged appropriately against the Accounts of Participants as the Administrative Committee shall determine.  Any expenses paid by the Company pursuant to Section 13.11 and this Section 13.12 shall be subject to reimbursement by other Employing Companies of their proportionate shares of such expenses as determined by the Administrative Committee.
13.13    Responsibility for Funding Policy.  The Pension Fund Investment Review Committee of The Southern Company System shall have responsibility for providing a procedure for establishing and carrying out a funding policy and method for the Plan consistent with the objectives of the Plan and the requirements of Title I of ERISA.  Included within the responsibility described in the preceding sentence, where necessary to accomplish the orderly 

53

administration of the Plan with respect to the investment of assets in a Participant’s Account, the Pension Fund Investment Review Committee may designate an Investment Fund or Investment Funds if necessary to serve this purpose.  Nothing in this Section 13.13 shall be construed to relieve a Participant of his obligations under Article VIII or to otherwise supersede any provision of Article VIII.
13.14    Management of Assets.  The Administrative Committee shall not have responsibility with respect to control or management of the assets of the Plan, nor any authority or discretion to select or terminate any Investment Funds.  The Trustee shall have the sole responsibility for the administration of the assets of the Plan as provided in the Trust Agreement, except to the extent that an investment advisor (who qualifies as an Investment Manager as that term is defined in ERISA) who is appointed by the Pension Fund Investment Review Committee shall have responsibility for the management of the assets of the Plan, or some part thereof (including powers to acquire and dispose of the assets of the Plan, or some part thereof).
13.15    Notice and Claims Procedures.  Pursuant to the requirements of ERISA and the regulations thereunder of the Secretary of Labor from time to time in effect, the Administrative Committee shall:
(a)    provide adequate notice in writing to any Participant or Beneficiary whose claim under the Plan has been denied, setting forth specific reasons for such denial, written in a manner calculated to be understood by such Participant or Beneficiary, and
(b)    afford a reasonable opportunity to any Participant or Beneficiary whose claim has been denied for a full and fair review of the decision denying the claim.
Notice and claims procedures established by the Administrative Committee for this purpose shall comply with ERISA, shall be set forth in the Summary Plan Description for the Plan and are incorporated herein by reference.  The decision of the Administrative Committee on review of a claim which has been denied shall be final and conclusive.  In addition to the foregoing, a Participant or Beneficiary shall not be permitted to bring any suit at law or in equity or any other legal claim concerning the Plan without first exhausting the remedies available hereunder as set forth in claims procedures described in the Summary Plan Description of the Plan.  Notwithstanding the foregoing, to the fullest extent permitted by law, no action at law or equity to recover under this Plan shall be commenced later than six months from the date of the decision of the Administrative Committee on appeal (or if no decision is furnished, six months from the final date of the period during which the Administrative Committee is required to provide notification of its determination under regulations issued by the Secretary of Labor).  The review procedures described and authorized herein and under the Summary Plan Description are the exclusive dispute resolution procedures provided under the Plan.
13.16    Bonding.  Unless otherwise determined by the Board of Directors or required by law, no member of the Administrative Committee shall be required to give any bond or other security in any jurisdiction.
13.17    Multiple Fiduciary Capacities.  Any person or group of persons may serve in more than one fiduciary capacity with respect to the Plan, and any fiduciary with respect to the 

54

Plan may serve as a fiduciary with respect to the Plan in addition to being an officer, employee, agent, or other representative of a party in interest, as that term is defined in ERISA.

55

ARTICLE XIV
 
TRUSTEE OF THE PLAN
14.1    Trustee.  The Company has entered into a Trust Agreement with the Trustee to hold the funds necessary to provide the benefits set forth in the Plan.  If the Board of Directors so determines, the Company may enter into a Trust Agreement or Trust Agreements with additional trustees.  Any Trust Agreement may be amended by the Company from time to time in accordance with its terms.  Any Trust Agreement shall provide, among other things, that all funds received by the Trustee thereunder will be held, administered, invested, and distributed by the Trustee, and that no part of the corpus or income of the Trust held by the Trustee shall be used for or diverted to purposes other than for the exclusive benefit of Participants or their Beneficiaries, except as otherwise provided in the Plan.  Any Trust Agreement may also provide that the investment and reinvestment of the Trust Fund, or any part thereof may be carried out in accordance with directions given to the Trustee by any Investment Manager or Investment Managers (as that term is defined in ERISA) who may be appointed by the Pension Fund Investment Review Committee.  The Board of Directors may remove any Trustee or any successor Trustee, and any Trustee or any successor Trustee may resign.  Upon removal or resignation of a Trustee, the Board of Directors shall appoint a successor Trustee.
14.2    Purchase of Common Stock.  As soon as practicable, the Trustee shall purchase Common Stock or cause Common Stock to be purchased in accordance with procedures established by the Administrative Committee or its delegate.  Such Common Stock may be purchased on the open market or by private purchase (including private purchases directly from The Southern Company); provided that (a) no private purchase may be made at any price greater than the last sale price or highest current independent bid price, whichever is higher, for Common Stock on the New York Stock Exchange, plus an amount equal to the commission payable in a stock exchange transaction; (b) if such private purchase shall be a purchase of Common Stock directly from The Southern Company, no commission shall be paid with respect thereto unless such commission satisfies the requirements of Prohibited Transaction Class Exemption 75-1; and (c) the Trustee may purchase Common Stock directly from The Southern Company under The Southern Investment Plan, as from time to time amended, or under any other similar plan made available to holders of record of shares of Common Stock which may be in effect from time to time, at the purchase price provided for in such plan.  The Trustee may hold in cash, and may temporarily invest funds applicable to the purchase of Common Stock in short term United States obligations, other obligations guaranteed by the United States Government, commercial paper, or certificates of deposit, and if the Trustee so determines, may transfer such funds to money market funds utilized by the Trustee for qualified employee benefit trusts.
14.3    Voting of Common Stock.  Before each annual or special meeting of shareholders of The Southern Company, there shall be sent to each Participant a copy of the proxy soliciting material for the meeting, together with a form requesting instructions to the Trustee on how to vote the shares of Common Stock credited to such Participant’s Account as of the record date of the Common Stock.  If a Participant does not provide the Trustee or its designated agent with timely voting instructions for the Trustee, the Pension Fund Investment Review Committee or its delegate may direct the Trustee how to vote such Participant’s shares.  If the Pension Fund 

56

Investment Review Committee or its delegate does not provide the Trustee or its designated agent with timely voting instructions, the Trustee, if required to do so by applicable law, may vote such Participant’s shares.  The Pension Fund Investment Review Committee or its delegate may direct the Trustee with respect to voting unallocated shares of Common Stock, if any.  If the Pension Fund Investment Review Committee or its delegate does not provide the Trustee or its designated agent with timely voting instructions, the Trustee, if required to do so by applicable law, may vote such unallocated shares.
14.4    Voting of Other Investment Fund Shares.  The Pension Fund Investment Review Committee or its delegate may direct the Trustee with respect to voting the shares in any Investment Fund other than the Company Stock Fund.  To the extent an Investment Manager has been designated with respect to an Investment Fund, such Investment Manager (and not the Pension Fund Investment Review Committee) shall direct the Trustee with respect to voting the shares in such Investment Fund.  If the Investment Manager does not direct the Trustee with respect to voting such shares, the Pension Fund Investment Review Committee may direct the Trustee with respect to voting such shares.  If the Pension Fund Investment Review Committee does not provide the Trustee or its designated agent with timely voting instructions, the Trustee, if required to do so by applicable law, may vote such shares.
14.5    Uninvested Amounts.  The Trustee may keep uninvested an amount of cash sufficient in its opinion to enable it to carry out the purposes of the Plan.
14.6    Independent Accounting.  The Board of Directors shall select a firm of independent public accountants to examine and report annually on the financial position and the results of operation of the Trust forming a part of the Plan.

57

ARTICLE XV
 
AMENDMENT AND TERMINATION OF THE PLAN
15.1    Amendment of the Plan.  The Plan may be amended or modified by the Board of Directors pursuant to its written resolutions at any time and from time to time; provided, however, that no such amendment or modification shall make it possible for any part of the corpus or income of the Trust Fund to be used for or diverted to purposes other than for the exclusive benefit of Participants or their Beneficiaries under the Plan, including such part as is required to pay taxes and administration expenses of the Plan.  The Plan may also be amended or modified by the Administrative Committee (a) if such amendment or modification does not involve a substantial increase in cost to any Employing Company, or (b) as may be necessary, proper, or desirable in order to comply with laws or regulations enacted or promulgated by any federal or state governmental authority and to maintain the qualification of the Plan under Code Sections 401(a) and 501(a) and the applicable provisions of ERISA as provided in regulations prescribed by the Secretary of the Treasury.
No amendment to the Plan shall have the effect of decreasing a Participant’s vested interest in his Account, determined without regard to such amendment, as of the later of the date such amendment is adopted or the date it becomes effective.  In addition, if the vesting schedule of the Plan is amended, any Participant who has completed at least three (3) Years of Service and whose vested interest is at any time adversely affected by such amendment may elect to have his vested interest determined without regard to such amendment during the election period defined under Code Section 411(a)(10).  Finally, no amendment shall eliminate an optional form of benefit in violation of Code Section 411(d)(6).
15.2    Termination of the Plan.  It is the intention of the Employing Companies to continue the Plan indefinitely.  However, the Board of Directors pursuant to its written resolutions may at any time and for any reason suspend or terminate the Plan or suspend or discontinue the making of contributions of all Participants and of contributions by all Employing Companies.  Any Employing Company may, by action of its board of directors and approval of the Board of Directors, suspend or terminate the making of contributions of Participants in the employ of such Employing Company and of contributions by such Employing Company.
In the event of termination of the Plan or partial termination or upon complete discontinuance of contributions under the Plan by all Employing Companies or by any one Employing Company, the amount to the credit of the Account of each Participant whose Employing Company shall be affected by such termination or discontinuance shall be determined as of the next Valuation Date and shall be distributed to him or his Beneficiary thereafter at such time or times and in such nondiscriminatory manner as is determined by the Administrative Committee in compliance with the restrictions on distributions set forth in Code Section 401(k).
15.3    Merger or Consolidation of the Plan.  The Plan shall not be merged or consolidated with nor shall any assets or liabilities thereof be transferred to any other plan unless each Participant of the Plan would (if the Plan then terminated) receive a benefit immediately after the merger, consolidation, or transfer which is equal to or greater than the benefit he would 

58

have been entitled to receive immediately prior to the merger, consolidation, or transfer (if the Plan had then terminated).

59

ARTICLE XVI
 
TOP HEAVY REQUIREMENTS
16.1    Top-Heavy Plan Requirements.  For any Plan Year the Plan shall be determined to be a top-heavy plan, the Plan shall provide the minimum allocation requirement of Section 16.3.
16.2    Determination of Top-Heavy Status.
(a)    For any Plan Year commencing after December 31, 1983, the Plan shall be determined to be a top-heavy plan, if, as of the Determination Date, the sum of the Aggregate Accounts of Key Employees under this Plan exceeds 60% of the Aggregate Accounts of all Employees entitled to participate in this Plan.
(b)    [Reserved.]
(c)    In the case of a Required Aggregation Group, each plan in the 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 Aggregation Group is not a Top-Heavy Group.
In the case of a Permissive Aggregation Group, 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.  A plan that is not part of the Required Aggregation Group but that has nonetheless been aggregated as part of the Permissive Aggregation Group will not be considered a top-heavy plan even if the Permissive Aggregation Group is a Top-Heavy Group.
(d)    For purposes of this Article XVI, if any Employee is a non-Key Employee for any Plan Year, but such Employee was a Key Employee for any prior Plan Year, such Employee’s Present Value of Accrued Retirement Income and/or Aggregate Account balance shall not be taken into account for purposes of determining if this Plan is a top-heavy plan (or whether any Aggregation Group which includes this Plan is a Top-Heavy Group).  In addition, if an Employee or former Employee has not performed any services for any Employing Company maintaining the Plan at any time during the one-year period ending on the Determination Date, the Aggregate Account and/or Present Value of Accrued Retirement Income shall be excluded in determining if this Plan is a top-heavy plan.
(e)    Only those plans of the Affiliated Employers in which the Determination Dates fall within the same calendar year shall be aggregated in order to determine whether such plans are top-heavy plans.
16.3    Minimum Allocation for Top-Heavy Plan Years.
(a)    Notwithstanding anything herein to the contrary, for any top-heavy Plan Year, the Employing Company contribution allocated to the Account of each non-Key Employee shall be an amount not less than the lesser of:  (1) 3% of such Participant’s 

60

compensation for that Plan Year, or (2) a percentage of that Participant’s compensation not to exceed the percentage at which contributions are made under the Plan for the Key Employee for whom such percentage is highest for that Plan Year.
(b)    For purposes of the minimum allocation of Section 16.3 (a), the percentage allocated to the Account of any Key Employee shall be equal to the ratio of the Employing Company contributions allocated on behalf of such Key Employee divided by the compensation of such Key Employee for that Plan Year.  Employer Matching Contributions shall be taken into account for purposes of satisfying the minimum contribution allocation requirements under Code Section 416(c)(2) and the Plan.
(c)    For any top-heavy Plan Year, the minimum allocations of Section 16.3(a) shall be allocated to the Accounts of all non-Key Employees who are Participants and who are employed by the Affiliated Employers on the last day of the Plan Year.
(d)    Notwithstanding the foregoing, in any Plan Year in which a non-Key Employee is a Participant in both this Plan and a defined benefit plan, and both such plans are top-heavy plans, the Affiliated Employers shall not be required to provide a non-Key Employee with both the full separate minimum defined benefit and the full separate defined contribution plan allocations.  Therefore, if a non-Key Employee is participating in a defined benefit plan maintained by the Affiliated Employers and the minimum benefit under Code Section 416(c)(1) is provided the non-Key Employee under such defined benefit plan, the minimum allocation provided for above shall not be applicable, and no minimum allocation shall be made on behalf of the non-Key Employee.  Alternatively, the Employing Company may satisfy the minimum allocation requirement of Code Section 416(c)(2) for the non-Key Employee by providing any combination of benefits and/or contributions that satisfy the safe harbor rules of Treasury Regulation Section 1.416-1(M-12).
(e)    For all top-heavy purposes other than the determination of whether an Employee is a Key Employee, “compensation” shall mean all payments by the employer to an Eligible Participant included as wages within the meaning of Code Section 3401(a) and all other payments of compensation to an Eligible Participant by the employer (in the course of the employer’s trade or business) for which the employer is required to furnish the Eligible Participant a written statement under Code Sections 6041(d), 6051(a)(3) and 6052.  Compensation for this purpose shall be determined without regard to any rules under Code Section 3401(a) that limit the remuneration included in wages based on the nature or location of the Eligible Participant or the services performed.  Compensation shall also include (i) an Eligible Participant’s elective deferrals under Code Sections 402(g)(3) and 414(v), (ii) amounts contributed or deferred under Code Section 125 by the employer at the Eligible Participant’s election that are not includible in the Eligible Participant’s gross income, and (iii) amounts which are not includible in an Eligible Participant’s gross income by reason of Code Sections 132(f)(4) or 457.  Compensation also shall be limited pursuant to Code Section 401(a)(17).

61

ARTICLE XVII
 
GENERAL PROVISIONS
17.1    Plan Not an Employment Contract.  The Plan shall not be deemed to constitute a contract between an Affiliated Employer and any Employee, nor shall anything herein contained be deemed to give any Employee any right to be retained in the employ of an Employing Company or to interfere with the right of an Employing Company to discharge any Employee at any time and to treat him without regard to the effect which such treatment might have upon him as a Participant.
17.2    No Right of Assignment or Alienation.  Except as may be otherwise permitted or required by law, no right or interest in the Plan of any Participant or Beneficiary and no distribution or payment under the Plan to any Participant or Beneficiary shall be subject in any manner to anticipation, alienation, sale, transfer (except by death), assignment (either at law or in equity), pledge, encumbrance, charge, attachment, garnishment, levy, execution, or other legal or equitable process, whether voluntary or involuntary, and any attempt to so anticipate, alienate, sell, transfer, assign, pledge, encumber, charge, attach, garnish, levy, or execute or enforce any other legal or equitable process against the same shall be void, nor shall any such right, interest, distribution, or payment be in any way liable for or subject to the debts, contracts, liabilities, engagements, or torts of any person entitled to such right, interest, distribution, or payment.  If any Participant or Beneficiary is adjudicated bankrupt or purports to anticipate, alienate, sell, transfer, assign, pledge, encumber, or charge any such right, interest, distribution, or payment, voluntarily or involuntarily, or if any action shall be taken which is in violation of the provisions of the immediately preceding sentence, the Administrative Committee may hold or apply or cause to be held or applied such right, interest, distribution, or payment or any part thereof to or for the benefit of such Participant or Beneficiary in such manner as is in accordance with applicable law.  In addition, a Participant’s benefits may be offset pursuant to a judgment, order, or decree issued (or settlement agreement entered into) on or after August 5, 1997, if and to the extent that such offset is permissible or required under Code Section 401(a)(13).
Notwithstanding the above, the Administrative Committee and the Trustee shall comply with any domestic relations order (as defined in Code Section 414(p)(1)(B)) which is a qualified domestic relations order satisfying the requirements of Code Section 414(p).  The Administrative Committee shall establish procedures for (a) notifying Participants and alternate payees who have or may have an interest in benefits which are the subject of domestic relations orders, (b) determining whether such domestic relations orders are qualified domestic relations orders under Code Section 414(p), and (c) distributing benefits which are subject to qualified domestic relations orders.
17.3    Payment to Minors and Others.  If the Administrative Committee determines that any person entitled to a distribution or payment from the Trust Fund is an infant or a minor, is incompetent, or is unable to care for his affairs by reason of physical or mental disability, it may cause all distributions or payments thereafter becoming due to such person to be made to any other person for his benefit, without responsibility to follow the application of payments so made.  Payments made pursuant to this provision shall completely discharge the Company, the Trustee, and the Administrative Committee with respect to the amounts so paid.  No person shall 

62

have any rights under the Plan with respect to the Trust Fund, or against the Trustee or any Employing Company, except as specifically provided herein.
17.4    Source of Benefits.  The Trust Fund established under the Plan shall be the sole source of the payments or distributions to be made in accordance with the Plan.  No person shall have any rights under the Plan with respect to the Trust Fund, or against the Trustee or any Employing Company, except as specifically provided herein.
17.5    Unclaimed Benefits.  If the Administrative Committee is unable, within five (5) years after any distribution becomes payable to a Participant or Beneficiary, to make or direct payment to the person entitled thereto because the identity or whereabouts of such person cannot be ascertained, notwithstanding the mailing of due notice to such person at his last known address as indicated by the records of either the Administrative Committee or his Employing Company, then such benefit or distribution will be disposed of as follows:
(a)    If the whereabouts of the Participant is unknown to the Administrative Committee, distribution will be made to the Participant’s Beneficiary or Beneficiaries.
Payment to such one or more persons shall completely discharge the Company, the Trustee, and the Administrative Committee with respect to the amounts so paid.
(b)    If none of the persons described in (a) above, can be located, then the benefit payable under the Plan shall be forfeited and shall be applied to reduce future Employer Matching Contributions.  Notwithstanding the foregoing sentence, such benefit shall be reinstated if a claim is made by the Participant or Beneficiary for the forfeited benefit.
In the event the Administrative Committee makes or directs a payment to the person entitled thereto but the check for such payment remains un-cashed for a period of 180 days, the Administrative Committee shall take such actions as it deems reasonable to determine the whereabouts of such person.  If the whereabouts of the person is unknown or the check remains un-cashed, the Administrative Committee shall direct that such check be cancelled.  In the event the person entitled to such payment subsequently requests payment, the Administrative Committee shall direct such payment to such person in the amount of the previous check.
17.6    Governing Law.  The provisions of the Plan and the Trust shall be construed, administered, and enforced in accordance with the laws of the State of Georgia, except to the extent such laws are preempted by the laws of the United States.

63

IN WITNESS WHEREOF, Southern Company Services, Inc., through the duly authorized officer has adopted this amendment and restatement of The Southern Company Employee Savings Plan effective as of January 1, 2018, to be executed this 12th day of December, 2017.

	
			
	 
	SOUTHERN COMPANY SERVICES, INC.

	 
	By:
	/s/Nancy E. Sykes

	 
	Name:
	Nancy E. Sykes

	 
	Its:
	EVP & Chief Human Resources Officer

64

APPENDIX A - EMPLOYING COMPANIES
The Employing Companies as of January 1, 2018 are:
Alabama Power Company 
Georgia Power Company 
Gulf Power Company 
Mississippi Power Company 
Southern Communications Services, Inc.
Southern Company Gas’ affiliated companies  
Southern Company Services, Inc. 
Southern Nuclear Operating Company, Inc.
Southern Power Company

APPENDIX B – Former AGL Resources Inc. Retirement Savings Plus Plan for
ETG Union Participants

Southern Company Gas previously established the AGL Resources Inc. Retirement Savings Plus Plan.  Effective as of July 1, 2016, Southern Company Services, Inc. (the “Company”) became the plan sponsor of the AGL Resources Inc. Retirement Savings Plus Plan.  Effective as of January 1, 2018, the AGL Resources Inc. Retirement Savings Plus was merged into the Southern Company Employee Savings Plan (the “Plan”) and the provisions in this Appendix B apply to the terminated Union Participants and the active union employees who are or were formerly employed by Elizabethtown Natural Gas and covered by the collective bargaining agreements (between Elizabethtown Gas Company and UWUA Local 24).  Each of these provisions wholly supplements and, to the extent of any conflict, replaces the corresponding provisions of the Plan.  For the avoidance of doubt, the definition for a defined term is set forth in the Plan, unless a different definition is set forth in this Appendix B.

ARTICLE II

DEFINITIONS

		
	•
	 “Compensation” shall have the meaning set forth below; provided, the annual compensation taken into account under the Plan for a Plan Year (or other applicable period) will not exceed the compensation limit under Code Section 401(a)(17) (as adjusted by the Secretary of the Treasury for cost of living increases).  For clarity, an ETG Participant’s Employer Elective Contributions, Roth Contributions and Voluntary Participant Contributions made under this Appendix B will be determined as a percentage of Compensation without excluding the amounts in excess of the limitation under Code Section 401(a)(17).  For purposes of determining the amount of Elective Employer, Roth and Voluntary Participant Contributions made under this Appendix B, determining the amount of Employer Matching Contributions thereon, and for all other purposes except as otherwise specified herein, “Compensation” means the total of the amounts described in subsections (a) and (b) below payable by an Employing Company, as follows:

		
	a.
	Such ETG Participant’s base salary (not including premiums); plus

		
	b.
	Such ETG Participant’s overtime, commissions and annual bonuses payable under the terms of any annual bonus plan sponsored by an Employing Company, as well as any other cash bonus paid by an Employing Company on a regular, periodic basis, such as a quarterly, monthly or semi-annual bonus (but, for clarity, not including retention bonuses, even if they are paid on a periodic basis).

		
	•
	  “ETG Participant” shall mean an employee of Elizabethtown Gas who is covered under the Collective Bargaining Agreement between Elizabethtown Gas and UWUA Local 24.

		
	•
	“Forfeiture” shall mean, for any Plan Year, the dollar amount that is removed from Accounts, but not distributed, during such Plan Year.

		
	•
	“Nonelective Contribution” shall mean the amounts paid to the Trust Fund by each Employing Company pursuant to the terms of Section 5.6 of this Appendix B.

		
	•
	“One-Year Break in Service” with respect to an ETG Participant, a “One-Year Break in Service” shall mean any year during which such Participant fails to complete more than 500 Hours of Service; provided, a One-Year Break in Service will not be deemed to have occurred during any period for which he is granted a leave of absence if he returns to the service of an Affiliate within the time permitted, subject to the following:

		
	(a)
	A One-Year Break in Service will be deemed to have commenced on the first day of the year in which it occurs. 

		
	(b)
	For purposes of determining whether or not an Employee has incurred a One-Year Break in Service, and solely for the purpose of avoiding a One-Year Break in Service, an Employee absent from work due to a maternity or paternity absence will be credited with (i) the number of Hours of Service with which he normally would have been credited but for the maternity or paternity absence, or (ii) if the Administrative Committee is unable to determine the hours described in clause (i) hereof, 8 Hours of Service for each day of absence included in the maternity or paternity leave; provided, the maximum number of Hours of Service credited for purposes of this subsection will not exceed 501 hours.  Hours of Service so credited will be applied only to the year in which the maternity or paternity leave begins, unless such Hours of Service are not required to prevent the Employee from incurring a One-Year Break in Service, in which event such Hours of Service will be credited to the Employee in the immediately following year.  No Hour of Service will be credited due to maternity or paternity absence as described herein unless the Employee furnishes proof satisfactory to the Administrative Committee (1) that his absence from work was due to a maternity or paternity absence and (2) of the number of days he was absent due to the maternity or paternity absence.  The Administrative Committee will prescribe uniform and nondiscriminatory procedures by which to make the above determinations.   

		
	(c)
	The term “maternity or paternity absence” shall mean an ETG Participant’s absence from work because of the pregnancy of the individual, the birth of a child of the individual, the placement of a child with the individual in connection with the adoption of a child by such individual, or for purposes of caring for the child by such person immediately following such birth or placement.  The Administrative Committee may require the individual to furnish such information as the Administrative Committee considers necessary to establish that the individual’s absence was for one of the reasons specified above.

		
	•
	“Pension-Eligible Participant” shall mean an active ETG Participant who is, on any relevant date of determination, eligible to actively accrue benefits under the Southern Company Pension Plan or any other defined benefit plan maintained by the Employing Companies.

B-2

		
	•
	 “Pension-Ineligible Participant” shall mean an active ETG Participant who is not, on any relevant date of determination, eligible to actively accrue benefits under the Southern Company Pension Plan or any other defined benefit plan maintained by the Employing Companies.

ARTICLE IV
ELECTIVE EMPLOYER CONTRIBUTIONS, ROTH CONTRIBUTIONS, AND VOLUNTARY PARTICIPANT CONTRIBUTIONS

4.1A    Automatic Enrollment.  

		
	(a)
	Generally. These provisions will apply to each ETG Participant who is hired or rehired after January 1, 2013.  Unless such an ETG Participant affirmatively elects to receive cash or make a different contribution election, he will be deemed to have made a deferral election to make Elective Employer Contributions, at the automatic contribution rate of six-percent (6%).  The deemed deferral election will be effective as soon as administratively feasible following the 30th day after the ETG Participant is hired.

		
	(b)
	Modification and Termination of Deemed Deferral Election.  An ETG Participant’s deemed deferral election will be effective for all subsequent paydays unless and until it is superseded by a subsequent election by the ETG Participant; provided, a deemed deferral election may be suspended or otherwise changed in accordance with uniform rules established by the Administrative Committee.  When the deemed deferral election ceases to be effective, the ETG Participant will cease to be covered by this automatic contribution arrangement unless he terminates employment and is subsequently rehired as an Eligible Participant with a new or reinstated deemed deferral election.  

ARTICLE V

EMPLOYER MATCHING CONTRIBUTIONS

5.1    Amount of Employer Matching Contributions.  Subject to Article IV of this Appendix B and the following provisions of this Article V, for each ETG Participant, on whose behalf the Employing Company makes (with respect to a payroll period or any other payment of Compensation) Elective Employer Contributions and/or Roth Contributions, the Employing Company will make an Employer Matching Contribution equal to: 

		
	(a)
	Pension-Eligible Participants.  For each ETG Participant who is a Pension-Eligible Participant, and on whose behalf an Employing Company makes (with respect to a payroll period or any other payment of Compensation) Elective Employer Contributions, Catch-up Contributions, Roth Contributions, and/or Roth Catch-up Contributions 

B-3

under this Appendix B, such Employing Company will make an Employer Matching Contribution equal to 65% of the amount of such contributions that do not exceed 8% of the ETG Participant’s Compensation with respect to such payroll period or other payment of Compensation.
		
	(b)
	Pension-Ineligible Participants.  For each ETG Participant who is a Pension-Ineligible Participant, on whose behalf an Employing Company makes under this Appendix B (with respect to a payroll period or any other payment of Compensation) Elective Employer Contributions, Catch-up Contributions, Roth Contributions, and/or Catch-up Roth Contributions under this Appendix B, such Employing Company will make an Employer Matching Contribution equal to:

		
	1.
	100% of the first 3% of the ETG Participant’s Compensation that is contributed as Elective Employer Contributions, Catch-up Contributions, Roth Contributions, and/or Catch-up Roth Contributions under this Appendix B with respect to such payroll period or other payment of Compensation, plus 

		
	2.
	75% of the amount over 3% but not in excess of 6% of the ETG Participant’s Compensation that is contributed as Elective Employer Contributions, Catch-up Contributions, Roth Contributions, and/or Catch-up Roth Contributions under this Appendix B with respect to such payroll period or other payment of Compensation.

5.6    Nonelective Contributions.  The Employing Companies will make a Nonelective Contribution, for the benefit of each ETG Participant, to the Plan with respect to each Plan Year.  The amount of any such Nonelective Contribution for such Plan Year will be equal to 1.5% of the Compensation for the Plan Year for each Pension-Ineligible Participant who (i) was employed by the Employing Companies on the last day of such Plan Year; or (ii) terminated employment with the Employing Companies during such Plan Year due to death, due to Disability, after reaching age 65, or after reaching age 55 and completing 10 Years of Service.

B-4

ARTICLE X

VESTING

10.1    Participant Contributions.  All ETG Participants will at all times be fully vested in the Elective Employer Contribution, Roth Contributions and Voluntary Participant Contribution amounts in their account and amounts from similar sources that are transferred from another plan.

10.2    Employer Contributions.
		
	(a)
	Vesting Schedule.  Except as otherwise provided in this Article X, the Employer Matching Contribution amount and Nonelective Contribution amount in the account of a Participant will vest in accordance with the following vesting schedule, based on the total of the Participant’s years of vesting service:

	
		
	Years of Vesting Service Completed by Participant
	Vested Percentage of ETG Participant’s Employer Matching Contribution  or Nonelective Contribution Accounts

	Less than 1 Year
	0%

	1 Year, but less than 2
	50%

	2 Years, but less than 3
	75%

	3 Years or more
	100%

		
	(b)
	Company Stock Dividends.  Notwithstanding subsection (a) above, amounts attributable to dividends paid to the ETG Participant’s account with respect to Employer Matching Contributions and Nonelective Contributions made in Common Stock (or the common stock of an Affiliated Employer that is readily tradable) held in the ETG Participant’s account, will at all times be vested.

		
	(c)
	Vesting Upon Attainment of Normal Retirement Age, Death or Disability.  Notwithstanding the provisions of subsection (a) above, the portion of an ETG Participant’s account attributable to the Employer Matching Contribution will become 100% vested and nonforfeitable upon the occurrence of any of the following events:

		
	(i)
	the ETG Participant’s death (including his death while performing qualified military service, as required by Code Section 401(a)(37));

		
	(ii)
	the ETG Participant’s reaching age 65; or

B-5

		
	(iii)
	the ETG Participant’s becoming Disabled.   

10.4    Former NUI Employees.  The accounts of all ETG Participants who were previously employed by NUI Corporation on or before December 31, 2005, will be fully vested after the ETG Participant completes one Year of Service.

B-6EX-10.1

 Exhibit 10.1 

EXECUTION VERSION 
 PURCHASE
AGREEMENT 
 This PURCHASE AGREEMENT (this “Agreement”) is entered into as of January 11, 2018 by and between
Taylor Morrison Home Corporation, a Delaware corporation (the “Company”) and each of the parties identified on Schedule I hereto (each a “Seller” and collectively, the “Sellers”). 

Background 
 A.
Each Seller desires to sell to the Company, at the price and upon the terms and conditions set forth in this Agreement, the number of common units (the “Common Units”) of TMM Holdings II Limited Partnership, a limited partnership
formed under the laws of the Cayman Islands (the “Partnership”), and a corresponding number of shares of the Company’s Class B common stock, $0.00001 par value per share (the “Class B Common
Stock”) set forth opposite such Seller’s name on Schedule I hereto (each such Common Unit together with its corresponding share of Class B Common Stock to be sold by such Seller, a “Purchased Interest” of such
Seller); 
 B. The Company desires to purchase each Seller’s Purchased Interests at the price and upon the terms and conditions set
forth in this Agreement (the “Purchases”); 
 C. The Company is conducting a public offering (the “Public
Offering”) of shares of its Class A common stock (the “Underwritten Shares”) pursuant to an Underwriting Agreement, dated January 11, 2018 (the “Underwriting Agreement”); 

D. The Company intends to use the proceeds received from the Public Offering to complete the Purchases. 

E. The board of directors of the Company has approved the transactions contemplated by this Agreement for purposes of Rule 16b-3 under the Securities Exchange Act of 1934 (the “Exchange Act”), which approval is intended to exempt each disposition by each Seller of its respective Purchased Interests to the extent that it
or any person affiliated with it may be deemed an officer or director of the Company, including a “director by deputization,” from Section 16(b) of the Exchange Act. 

THEREFORE, in consideration of the mutual covenants herein and other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the undersigned hereby agree as follows: 
 Agreement 

1. Purchase. 
 (a) At the
Closing (as defined below), subject to the satisfaction of the conditions and to the terms set forth in paragraphs l(b) and l(c) below, each Seller, severally and not jointly, hereby agrees to transfer, assign, sell, convey and

 
deliver to the Company 100% of its right, title and interest in and to such Seller’s Purchased Interests, and the Company hereby agrees to purchase such Purchased Interests at a purchase
price per Purchased Interest equal to the per share price at which the Company sells the Underwritten Shares to the underwriters in the Public Offering (the “Per Share Purchase Price”). 

(b) The obligations of the Company to purchase the Purchased Interests from any Seller shall be subject to (i) the closing of the Public
Offering, (ii) the representations and warranties of such Seller being true and correct in all material respects as of the Closing and (iii) such Seller having complied in all material respects with all of the covenants required to be
performed by such Seller on or prior to the Closing. 
 (c) The closing of the sale of the Purchased Interests (the
“Closing”) shall take place immediately following the closing of the Public Offering, at the offices of the Company, or at such other time and place as may be agreed upon by the Company and the Sellers. 

(d) At the Closing, each Seller shall deliver to the Company or as instructed by the Company duly executed transfer powers relating to such
Seller’s Purchased Interests and the Company agrees to deliver to such Seller the Applicable Purchase Price by wire transfer of immediately available funds to the account(s) specified in writing by such Seller. “Applicable Purchase
Price” means, with respect to any Seller, the product of the Per Share Purchase Price and the aggregate number of Purchased Interests being sold by such Seller pursuant to the terms of this Agreement. 

(e) Neither the Company nor any of its affiliates intends to withhold any amounts payable pursuant to this Agreement pursuant to Sections 1445
or 1446(f) of the Internal Revenue Code of 1986, as amended (the “Code”). If the Internal Revenue Service issues a Notice of Proposed Adjustment (or similar Notice) that the Company was required to withhold and remit tax under
Section 1445 or Section 1446(f) of the Code on the proceeds payable to a Seller pursuant to this Agreement, then at the Company’s request, such Seller shall use commercially reasonable efforts to provide within 30 days evidence
(intended to be sufficient to satisfy the requirements of United States Treasury Regulations Section 1.1445-1(e)(3) or any similar provision of Unites States Treasury Regulations issued under
Section 1446(f) of the Code) that such Seller has filed all federal income tax returns required to be filed by such Seller (and paid all federal income tax shown as due from such Seller on such returns) with respect to the Purchase from such
Seller pursuant to this Agreement; provided, however, at the election of such Seller, such Seller may provide any such evidence directly to the Internal Revenue Service and not to the Company or any other third-party. 

  
 2 

 2. Company Representations. In connection with the transactions contemplated hereby, the
Company represents and warrants as of the date hereof to the Sellers that: 
 (a) The Company is a corporation duly organized and validly
existing under the laws of the State of Delaware. The Company has the requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby. 

(b) This Agreement has been duly authorized, executed and delivered by the Company and constitutes a valid and binding agreement of the Company
enforceable in accordance with its terms, except to the extent that enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other laws affecting enforcement of creditors’ rights or by general equitable principles. 

(c) The execution, delivery and performance by the Company of this Agreement and the consummation of the transactions herein contemplated will
not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, (ii) violate any provision of the certificate of
incorporation or by-laws, or other organizational documents, as applicable, of the Company or its subsidiaries or (iii) violate any statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or any of its subsidiaries or any of their properties, in the case of each such clause, after giving effect to any consents, approvals, authorizations, orders, registrations, qualifications,
waivers and amendments as will have been obtained or made as of the date of this Agreement, and except, in the case of clauses (i) and (ii), as would not reasonably be expected to have a material adverse effect on (A) the business,
operations, results of operations, properties, assets or condition (financial or otherwise) of the Company, the Partnership and its subsidiaries, taken as a whole, or (B) the ability of the Company to consummate the transactions contemplated by
this Agreement (a “Material Adverse Effect”); and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the execution, delivery and
performance by the Company of its obligations under this Agreement, including the consummation by the Company of the transactions contemplated by this Agreement, except where the failure to obtain or make any such consent, approval, authorization,
order, registration or qualification would not reasonably be expected to have a Material Adverse Effect. 
 3. Representations of the
Sellers. In connection with the transactions contemplated hereby, each of the Sellers, severally and not jointly, represents and warrants to the Company as of the date hereof and covenants and agrees that: 

(a) Such Seller is duly organized and existing under the laws of its jurisdiction of organization. 

  
 3 

 (b) All consents, approvals, authorizations and orders necessary for the execution and delivery
by such Seller of this Agreement and for the sale and delivery of the Purchased Interests to be sold by such Seller hereunder, have been obtained; and such Seller has full right, power and authority to enter into this Agreement and to sell, assign,
transfer and deliver the Purchased Interests to be sold by such Seller hereunder, except for such consents, approvals, authorizations and orders as would not impair in any material respect the consummation of such Seller’s obligations
hereunder. 
 (c) This Agreement has been duly executed and delivered by such Seller and constitutes a valid and binding agreement of such
Seller, enforceable in accordance with its terms, except to the extent that enforcement thereof may be limited by bankruptcy, insolvency, reorganization or other laws affecting enforcement of creditors’ rights or by general equitable
principles. 
 (d) The sale of the Purchased Interests to be sold by such Seller hereunder and the compliance by such Seller with all of the
provisions of this Agreement and the consummation of the transactions contemplated herein (i) does not and will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any
statute, indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which such Seller is a party or by which such Seller is bound or to which any of the property or assets of such Seller is subject as of the date hereof,
(ii) nor will such action result in any violation of the provisions of any organizational or similar documents pursuant to which such Seller was formed (to the extent such Seller is not an individual) or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over such Seller or the property of such Seller; except in the case of clause (i) or clause (ii), for such conflicts, breaches, violations or defaults as would not
impair in any material respect the consummation of such Seller’s obligations hereunder. 
 (e) As of the date hereof and immediately
prior to the delivery of the Purchased Interests to the Company at the Closing, such Seller holds good and valid title to the Purchased Interests to be sold at the Closing or a securities entitlement in respect thereof, and holds, and will hold
until delivered to the Company, such Purchased Interests free and clear of all liens, encumbrances, equities or claims; and, upon delivery of such Purchased Interests (including by crediting to a securities account of the Company) and payment
therefor pursuant hereto, assuming that the Company has no notice of any adverse claims within the meaning of Section 8-105 of the New York Uniform Commercial Code as in effect in the State of New York
from time to time (the “UCC”), (A) under 8-501 of the UCC, the Company will acquire a valid security entitlement (within the meaning of
Section 8-102(a)(17) of the UCC) to such Purchased Interests purchased by the Company and (B) no action (whether framed in conversion, replevin, constructive trust, equitable lien or other theory)
based on an adverse claim (within the meaning of Section 8-105 of the UCC) to such security entitlement may be asserted against the Company. 

(f) Such Seller (either alone or together with its advisors) has such knowledge and experience in financial or business matters that it is
capable of evaluating the merits and risks of the Purchases. Such Seller has had the opportunity to ask questions and receive answers concerning the terms and conditions of the Purchases, and has had full access to such other information concerning
the Purchases as it has 

  
 4 

 
requested. Such Seller has received all information that it believes is necessary or appropriate in connection with the Purchases. Such Seller is an informed and sophisticated party and has
engaged, to the extent such Seller deems appropriate, expert advisors experienced in the evaluation of transactions of the type contemplated hereby. Such Seller acknowledges that such Seller has not relied upon any express or implied representations
or warranties of any nature made by or on behalf of the Company, whether or not any such representations, warranties or statements were made in writing or orally, except as expressly set forth for the benefit of such Seller in this Agreement. 

4. Termination. This Agreement shall automatically terminate and be of no further force and effect in the event that the conditions in
paragraph 1(b) of this Agreement have not been satisfied on or prior to January 17, 2018. 
 5. Notices. All notices, demands or
other communications to be given or delivered under or by reason of the provisions of this Agreement will be in writing and will be deemed to have been given when delivered personally, mailed by certified or registered mail, return receipt requested
and postage prepaid, or sent via a nationally recognized overnight courier, or sent via facsimile to the recipient. Such notices, demands and other communications will be sent to the address indicated below: 

To the Sellers: 
 At the address
listed for each Seller on Schedule I hereto. 
 To the Company: 

Taylor Morrison Home Corporation 

4900 North Scottsdale Road, Suite 2000 

Scottsdale, AZ 85251 
 Attention:
Darrell C. Sherman, Esq. 
 Executive Vice President, Chief Legal Officer and Secretary 

Facsimile: (866) 390-2612 

E-mail: dsherman@taylormorrison.com 

with a copy to (which shall not constitute notice): 

Paul, Weiss, Rifkind, Wharton & Garrison LLP 

1285 Avenue of the Americas 
 New
York, NY 10019-6064 
 Attention: John C. Kennedy 

Facsimile: (212) 757-3990 

E-mail: jkennedy@paulweiss.com 

or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. 

  
 5 

 6. Miscellaneous. 

(a) Survival of Representations and Warranties. All representations and warranties contained herein or made in writing by any party in
connection herewith shall survive the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby. 

(b) Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be invalid, illegal, or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality, or unenforceability will not affect any
other provision or any other jurisdiction, but this Agreement will be reformed, construed, and enforced in such jurisdiction as if such invalid, illegal, or unenforceable provision had never been contained herein. 

(c) Complete Agreement. This Agreement and any other agreements ancillary thereto and executed and delivered on the date hereof embody
the complete agreement and understanding between the parties and supersede and preempt any prior understandings, agreements, or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.

 (d) Counterparts. This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of
which taken together constitute one and the same agreement. 
 (e) Assignment; Successors and Assigns. Neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned, in whole or in part, by any of the parties without the prior written consent of the other parties. Subject to the preceding sentence, this Agreement shall bind and inure to the
benefit of and be enforceable by the Sellers and the Company and their respective successors and permitted assigns. Any purported assignment not permitted under this paragraph shall be null and void. 

(f) No Third Party Beneficiaries or Other Rights. This Agreement is for the sole benefit of the parties and their successors and
permitted assigns and nothing herein express or implied shall give or shall be construed to confer any legal or equitable rights or remedies to any person other than the parties to this Agreement and such successors and permitted assigns. 

(g) Governing Law; Jurisdiction. This Agreement and all disputes arising out of or related to this Agreement (whether in contract, tort
or otherwise) will be governed by and construed in accordance with the laws of the State of New York. EACH OF THE PARTIES TO THIS AGREEMENT IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO
THIS AGREEMENT. Each of the parties (i) irrevocably submits to the personal jurisdiction of any state or federal court 

  
 6 

 
sitting in New York, New York, as well as to the jurisdiction of all courts to which an appeal may be taken from such courts, in any suit, action or proceeding relating to or arising out of,
under or in connection with this Agreement, (ii) agrees that all claims in respect of such suit, action or proceeding, whether arising under contract, tort or otherwise, shall be brought, heard and determined exclusively in the federal court of
the Southern District of New York (provided, that, in the event that subject matter jurisdiction is unavailable in that court, then all such claims shall be brought, heard and determined exclusively in any other state or federal court sitting
in New York, New York), (iii) agrees that it shall not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from such court, and (iv) agrees not to bring any action or proceeding relating to or arising out
of, under or in connection with this Agreement or the Company’s business or affairs in any other court, tribunal, forum or proceeding. Each of the parties waives any defense of inconvenient forum to the maintenance of any action or proceeding
brought in accordance with this paragraph. Each of the parties agrees that service of any process, summons, notice or document by U.S. registered mail to its address set forth herein shall be effective service of process for any action, suit or
proceeding brought against it in accordance with this paragraph, provided, that nothing in the foregoing sentence shall affect the right of any party to serve legal process in any other manner permitted by law. 

(h) Mutuality of Drafting. The parties have participated jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by the parties, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any
provision of the Agreement. 
 (i) Remedies. The parties hereto agree and acknowledge that money damages will not be an adequate
remedy for any breach of the provisions of this Agreement, that any breach of the provisions of this Agreement shall cause the other parties irreparable harm, and that any party may in its sole discretion apply to any court of law or equity of
competent jurisdiction (without posting any bond or deposit) for specific performance or other injunctive relief in order to enforce, or prevent any violations of, the provisions of this Agreement. 

(j) Amendment and Waiver. The provisions of this Agreement may be amended, modified or waived only with the prior written consent of the
Company and each of the Sellers. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions of this Agreement, nor shall any waiver constitute a continuing waiver. Moreover, no failure
by any party to insist upon strict performance of any of the provisions of this Agreement or to exercise any right or remedy arising out of a breach thereof shall constitute a waiver of any other provisions or any other breaches of this Agreement.

 (k) Further Assurances. Each of the Company and the Sellers shall execute and deliver such additional documents and instruments and
shall take such further action as may be necessary or appropriate to effectuate fully the provisions of this Agreement. 
 [Signatures
appear on following page] 

  
 7 

 IN WITNESS WHEREOF, the parties hereto have executed this Purchase Agreement on the date first
written above. 
  

					
	Company:
	
	Taylor Morrison Home Corporation
			
		 	By:	 	 /s/ Sheryl D. Palmer

		 	Name:	 	Sheryl D. Palmer
		 	Title:	 	Chairman and Chief Executive Officer

 [Signature Page to Purchase Agreement] 

 
			
	Sellers:
	
	TPG TMM Holdings II, L.P.
	
	By: TPG TMM Holdings II GP, ULC, its general partner
		
	By:	 	 /s/ Michael LaGatta

		 	Name:    Michael LaGatta
		 	Title:      Vice President

  
 9 

[Signature Page to Purchase Agreement] 

 
					
	Sellers:
	
	OCM TMM Holdings II, L.P.
	
	By: OCM TMM Holdings II GP, ULC, its general partner
		
	By:	 	 /s/ Rajath Shourie

		 	Name:	 	Rajath Shourie
		 	Title:	 	Authorized Signatory
		
	By:	 	 /s/ Taejo Kim

		 	Name:	 	Taejo Kim
		 	Title:	 	Authorized Signatory

  
 10 

[Signature Page to Purchase Agreement] 

 SCHEDULE I 
  

					
	 Seller
	  	 Address
	  	 Purchased Interests

	TPG TMM Holdings II, L.P.	  	 TPG Global, LLC
 301 Commerce Street, Suite
3300
 Fort Worth, TX 76102
 Attention: Adam Fliss

Facsimile: (415) 438-6893

E-mail: afliss@tpg.com
  

With a copy (which shall not constitute notice) to:
  

Ropes & Gray LLP
 The Prudential Tower

800 Boylston Street
 Boston, Massachusetts 02199

Attention: Alfred O. Rose

                 Julie H. Jones

Facsimile: (617) 951-7050

E-mail: Alfred.rose@ropesgray.com

             Julie.jones@ropesgray.com
	  	8,853,462
			
	OCM TMM Holdings II, L.P.	  	 Oaktree Capital Management, L.P.
 333 South
Grand Ave., 28th Floor
 Los Angeles, CA 90071
 Facsimile: (213)
830-6293
 E-mail: kliang@oaktreecapital.com

 
 with a copy (which shall not constitute notice) to:

 
 Debevoise & Plimpton LLP

919 Third Avenue
 New York, NY 10022

Attention: Jasmine Ball
 Facsimile: (212) 909-6836
 E-mail: jball@debevoise.com
	  	8,853,462

 [Schedule I to Purchase Agreement]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00278-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00278-of-00352.parquet"}]]