Document:

EQUITY CONTRIBUTION GUARANTEE

          EQUITY CONTRIBUTION GUARANTEE, dated as of July 20, 2001, made by COGENTRIX ENERGY, INC., a North Carolina corporation (the "Equity Guarantor"), in favor of CALENDNIA GENERATING, LLC (the "Borrower") and First Union National Bank, a national banking association, as security agent (in such capacity, the "Security Agent") for General Electric Capital Corporation, as letter of credit provider (the "Letter of Credit Provider"), General Electric Capital Corporation and the other banks and financial institutions ("Lenders") parties to the Loan and Reimbursement Agreement, dated as of July 20, 2001 (as amended, supplemented or otherwise modified from time to time, the "Loan Agreement"), among the Borrower, the Issuing Bank, the Lenders and General Electric Capital Corporation, as administrative agent (in such capacity, the "Administrative Agent").

W I T N E S S E T H:

          WHEREAS, pursuant to the Loan Agreement, the Lenders have severally agreed to make Loans to the Borrower and the Issuing Bank has agreed to provide the Credit Support Letters of Credit for the account of the Borrower upon the terms and subject to the conditions set forth therein;

          WHEREAS, Cogentrix Caledonia Holdings I, Inc. ("the "Equity Contributor") owns directly or indirectly 100% of the limited liability interests in the Borrower and will enter into the Equity Contribution Agreement (the "Equity Contribution Agreement"), together with Equity Guarantor and First Union National Bank, as Security Agent, pursuant to which the Equity Contributor will make cash equity contributions to the Borrower upon the terms and subject to the conditions set forth therein;

          WHEREAS, the Equity Guarantor is the direct or indirect parent of the Equity Contributor and the Borrower, and it is to the advantage of the Equity Guarantor that the Lenders make the Loans to the Borrower and the Issuing Bank provide the Credit Support Letters of Credit; and

          WHEREAS, it is a condition precedent to the obligation of the Lenders to make their respective Loans to the Borrower and the Issuing Bank to provide the Credit Support Letters of Credit under the Loan Agreement that the Equity Contributor shall have executed and delivered the Equity Contribution Agreement and that the Equity Guarantor shall have executed and delivered this Equity Contribution Guarantee to the Security Agent for the ratable benefit of the Secured Parties.

          NOW, THEREFORE, in consideration of the premises and to induce the Lenders and the Issuing Bank to enter into the Loan Agreement and to induce the Lenders to make their respective Loans to the Borrower and the Issuing Bank to provide the Credit Support Letters of Credit under the Loan Agreement, the Equity Guarantor hereby agrees with the Borrower, the Security Agent, for the ratable benefit of the Secured Parties, as follows:

     1.   Defined Terms.   (a)   Unless otherwise defined herein, terms defined in Annex A to the Loan Agreement or the in Equity Contribution Agreement, as applicable, and used herein shall have the meanings given to them in Annex A to the Loan Agreement or in the Equity Contribution Agreement, as applicable.

          (b)   As used herein, "Obligations" means the collective reference to the unpaid amount of the Equity Contributions plus interest accruing at the then applicable rate provided in the Equity Contribution Agreement after the Equity Contributions are due, and interest accruing at the then applicable rate provided in the Equity Contribution Agreement after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Equity Contributor whether or not a claim for post-filing or post-petition interest is allowed in such proceeding, due under the Equity Contribution Agreement; provided that the Equity Guarantor's liability for the Obligations under this Equity Contribution Guarantee shall in no event exceed US$55,556,632.00 (the "Maximum Guaranteed Amount").

          (c)   The words "hereof," "herein" and "hereunder" and words of similar import when used in this Equity Contribution Guarantee shall refer to this Equity Contribution Guarantee as a whole and not to any particular provision of this Equity Contribution Guarantee, and section and paragraph references are to this Equity Contribution Guarantee unless otherwise specified.

          (d)   The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.

     2.   Guarantee.   (a)   The Equity Guarantor hereby unconditionally and irrevocably guarantees to the Borrower and the Security Agent, for the ratable benefit of the Secured Parties and their respective successors, indorsees, transferees and assigns, the prompt and complete payment by the Equity Contributor when due of the Obligations up to the Maximum Guaranteed Amount.

         (b)   The Equity Guarantor further agrees to pay any and all expenses (including, without limitation, all reasonable fees and disbursements of counsel) which may be paid or incurred by the Borrower, the Security Agent or any Secured Party in enforcing, or obtaining advice of counsel in respect of, any rights with respect to, or collecting against, the Equity Guarantor under this Equity Contribution Guarantee.

          (c)   The Equity Guarantor agrees that whenever, at any time, or from time to time, it shall make any payment to the Security Deposit Agent on account of its liability hereunder, it will notify the Security Agent in writing that such payment is made under this Equity Contribution Guarantee for such purpose.

     3.   Right of Set-off.  The Security Agent and each Secured Party is hereby irrevocably authorized at any time and from time to time without notice to the Equity Guarantor, any such notice being expressly waived by the Equity Guarantor, to set off and appropriate and apply any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by the Security Agent or such Secured Party to or for the credit or the account of the Equity Guarantor, or any part thereof in such amounts as the Security Agent or such Secured Party may elect, against or on account of the obligations and liabilities of the Equity Guarantor to the Security Agent or such Secured Party hereunder, whether or not the Security Agent or such Secured Party has made any demand for payment and although such obligations, liabilities and claims may be contingent or unmatured; provided that the aggregate of such amount so set off, appropriated and applied, plus the aggregate of the amounts paid by the Equity Guarantor hereunder in respect of the Obligations, shall in no event exceed the Maximum Guaranteed Amount.  The Security Agent and each Secured Party shall notify the Equity Guarantor promptly of any such set-off and the application made by the Security Agent or such Secured Party, as the case may be, of the proceeds thereof; provided that the failure to give such notice shall not affect the validity of such set-off and application.  The rights of the Security Agent and each Secured Party under this paragraph are in addition to other rights and remedies (including, without limitation, other rights of set-off) which the Security Agent or such Secured Party may have.

     4.   No Subrogation.  Notwithstanding any payment or payments made by the Equity Guarantor hereunder, or any set-off or application of funds of the Equity Guarantor by the Security Agent or any Secured Party, the Equity Guarantor shall not be entitled to be subrogated to any of the rights of the Security Agent or any Secured Party against the Equity Contributor or against any collateral security or guarantee or right of offset held by the Security Agent or any Secured Party for the payment of the Obligations, nor shall the Equity Guarantor seek or be entitled to seek any contribution or reimbursement from the Equity Contributor in respect of payments made by the Equity Guarantor hereunder, until all amounts owing to the Security Agent and the Secured Parties on account of the Obligations and the Secured Obligations are paid in full.  If any amount shall be paid to the Equity Guarantor on account of such subrogation rights at any time when all of the Obligations and the Secured Obligations shall not have been paid in full, such amount shall be held by the Equity Guarantor in trust for the Security Agent and the Secured Parties, segregated from other funds of the Equity Guarantor, and shall, forthwith upon receipt by the Equity Guarantor, be turned over to the Security Agent in the exact form received by the Equity Guarantor (duly indorsed by the Equity Guarantor to the Security Agent, if required), to be applied against the Obligations, whether matured or unmatured, in such order as the Security Agent may determine.  After all amounts owing to the Security Agent and the Secured Parties on account of the Obligations and the Secured Obligations are paid in full, the Equity Guarantor shall be subrogated to the rights of the Security Agent and the Secured Parties against the Equity Contributor.

     5.   Amendments, etc. with respect to the Obligations; Waiver of Rights.  The Equity Guarantor shall remain obligated hereunder notwithstanding that, without any reservation of rights against the Equity Guarantor, and without notice to or further assent by the Equity Guarantor, any demand for payment of any of the Obligations made by the Borrower, the Security Agent or any Secured Party may be rescinded by the Borrower, the Security Agent or such Secured Party, and any of the Obligations continued, and the Obligations, or the liability of any other party upon or for any part thereof, or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released by the Borrower, the Security Agent or any Secured Party, and the Equity Contribution Agreement, the Loan Agreement, any Notes, and the other Financing Documents and any other documents executed and delivered in connection therewith may be amended, modified, supplemented or terminated, in whole or in part, as the Borrower or the Security Agent (or the Required Lenders, as the case may be) may deem advisable from time to time, and any collateral security, guarantee or right of offset at any time held by the Security Agent or any Secured Party for the payment of the Obligations may be sold, exchanged, waived, surrendered or released.  Neither the Security Agent nor any Secured Party shall have any obligation to protect, secure, perfect or insure any Lien at any time held by it as security for the Obligations or for this Equity Contribution Guarantee or any property subject thereto. When making any demand hereunder against the Equity Guarantor, the Borrower, the Security Agent or any Secured Party may, but shall be under no obligation to, make a similar demand on the Equity Contributor or any other guarantor, and any failure by the Borrower, the Security Agent or any Secured Party to make any such demand or to collect any payments from the Equity Contributor or any such other guarantor or any release of the Equity Contributor or such other guarantor shall not relieve the Equity Guarantor of its obligations or liabilities hereunder, and shall not impair or affect the rights and remedies, express or implied, or as a matter of law, of the Borrower, the Security Agent or any Secured Party against the Equity Guarantor.  For the purposes hereof "demand" shall include the commencement and continuance of any legal proceedings.

     6.   Guarantee Absolute and Unconditional.  The Equity Guarantor waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations and notice of or proof of reliance by the Borrower, the Security Agent or any Secured Party upon this Equity Contribution Guarantee or acceptance of this Equity Contribution Guarantee, and the Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon this Equity Contribution Guarantee; and all dealings between the Equity Contributor or the Equity Guarantor, on the one hand, and the Borrower, the Security Agent and the Secured Parties, on the other, shall likewise be conclusively presumed to have been had or consummated in reliance upon this Equity Contribution Guarantee.  The Equity Guarantor waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon the Equity Contributor or the Equity Guarantor with respect to the Obligations.  This Equity Contribution Guarantee shall be construed as a continuing, absolute and unconditional guarantee of payment without regard to (a) the validity, regularity or enforceability of the Equity Contribution Agreement, the Loan Agreement, any Note, or any other Financing Document, any of the Obligations or any other collateral security therefor or guarantee or right of offset with respect thereto at any time or from time to time held by the Borrower, the Security Agent or any Secured Party, (b) any defense, set-off or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by the Equity Contributor against the Borrower, the Security Agent or any Secured Party, or (c) any other circumstance whatsoever (with or without notice to or knowledge of the Equity Contributor or the Equity Guarantor) which constitutes, or might be construed to constitute, an equitable or legal discharge of the Equity Contributor for the Obligations, or of the Equity Guarantor under this Equity Contribution Guarantee, in bankruptcy or in any other instance.  When pursuing its rights and remedies hereunder against the Equity Guarantor, the Borrower, the Security Agent and any Secured Party may, but shall be under no obligation to, pursue such rights and remedies as it may have against the Equity Contributor or any other Person or against any collateral security or guarantee for the Obligations or any right of offset with respect thereto, and any failure by the Borrower, the Security Agent or any Secured Party to pursue such other rights or remedies or to collect any payments from the Equity Contributor or any such other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of the Equity Contributor or any such other Person or of any such collateral security, guarantee or right of offset, shall not relieve the Equity Guarantor of any liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Borrower, the Security Agent or any Secured Party against the Equity Guarantor.

     7.   Reinstatement.  This Equity Contribution Guarantee shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of any of the Obligations is rescinded or must otherwise be restored or returned by the Borrower, the Security Agent or any Secured Party upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Borrower, the Equity Contributor or any other Person or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, the Borrower, the Equity Contributor or any such other Person or any substantial part of its property, or otherwise, all as though such payments had not been made.  

     8.   No Commencement of Bankruptcy Proceedings.  The Equity Guarantor shall not commence or join with any other Person (other than the Secured Parties) in commencing any proceeding against the Equity Contributor or the Borrower under any bankruptcy, reorganization, liquidation or insolvency law or statute now or hereafter in effect in any jurisdiction.

Payments.  The Equity Guarantor hereby agrees that all payments of the Obligations will be paid to the Security Deposit Agent on or before the first Business Day after such payments are due and shall be made by wire transfer of immediately available funds in Dollars to the Security Deposit Agent at First Union National Bank, Attn:  Corporate Trust - Bond Administration, 401 S. Tryon, 12th Floor, Charlotte, NC  28288-1179, ABA No. 053000219, Account No. 5000000016439, Attention: James Long, Branch 898, Reference: Caledonia, 1072006994, or at such other address as the Security Deposit Agent may designate in writing from time to time.

     9.   Representations and Warranties.  The Equity Guarantor represents and warrants to the Security Agent and the Secured Parties that:

          (a)   Financial Statements.  The balance sheet of the Equity Guarantor as at September 30, 2000, and the related statements of income and cash flows for the period then ended, heretofore furnished to the Administrative Agent and certified by a Responsible Officer of the Equity Guarantor, are the most recent financial statements prepared by the Equity Guarantor prior to the execution and delivery of this Equity Contribution Guarantee, and are complete and correct in all material respects and fairly present the financial condition, results of operations and changes in cash flows of the Equity Guarantor on such date and for such interim period then ended, in conformity with GAAP applied on a consistent basis.  All material liabilities, direct and contingent, of the Equity Guarantor on such date are either disclosed in such balance sheet or have been disclosed in writing by the Equity Guarantor to the Administrative Agent prior to the execution and delivery of this Equity Contribution Guarantee.  On the Closing Date, there are no undisclosed material liabilities, direct or contingent, which have accrued since the date of such financial statements or such subsequent disclosure.

          (b)   Corporate Existence and Business.  The Equity Guarantor is a corporation duly organized and validly existing in good standing under the laws of the jurisdiction of its incorporation, is duly qualified to do business and is in good standing in each other jurisdiction where the failure to so qualify could reasonably be expected to have a  material adverse effect on its ability to perform hereunder.  As of the Closing Date, the Equity Guarantor directly or indirectly owns 100% of the equity interests in the Equity Contributor.

          (c)   Power and Authorization; Enforceable Obligations.  The Equity Guarantor has full power and authority and the legal right to own its properties and to conduct its business as now conducted and proposed to be conducted by it, to execute, deliver and perform this Equity Contribution Guarantee and the other Transaction Documents to which it is a party and to take all action as may be necessary to complete the transactions contemplated hereunder and thereunder.  The Equity Guarantor has taken all necessary corporate action to authorize the execution, delivery and performance of this Equity Contribution Guarantee and the other Transaction Documents to which it is a party.  No consent or authorization of, filing with, or other act by or in respect of any other Person (including any of its stockholders or creditors) is required in connection with its execution, delivery or performance or the validity or enforceability as to it of this Equity Contribution Guarantee and the other Transaction Documents to which it is a party.  This Equity Contribution Guarantee and each of the other Transaction Documents to which the Equity Guarantor is a party has been duly executed and delivered by it and constitutes a legal, valid and binding obligation enforceable against it in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights of creditors generally and by general principles of equity.

          (d)   No Legal Bar.  The execution, delivery and performance by the Equity Guarantor of this Equity Contribution Guarantee and the other Transaction Documents to which it is a party and the making of any payments hereunder by it will not violate any Requirement of Law applicable to it or its properties or any of its contractual obligations and will not result in, or require, the creation or imposition of any Lien on any of its properties or revenues pursuant to any applicable law or contractual obligation.

          (e)   No Proceeding or Litigation.  No litigation or proceeding of or before any arbitrator or Governmental Authority is pending or, to the best of the Equity Guarantor's knowledge, threatened against or affecting it or against or affecting any of its properties, rights, revenues or assets or the transactions contemplated by this Equity Contribution Guarantee and the other Transaction Documents which could reasonably be expected to have a material adverse effect on the Equity Guarantor's ability to perform its obligations hereunder.

          (f)   Investment Company Act.  The Equity Guarantor is not an "investment company" or a company "controlled" by an "investment company", within the meaning of the Investment Company Act of 1940, as amended.

          (g)   The Equity Guarantor agrees that the foregoing representations and warranties shall be deemed to have been made by the Equity Guarantor on the date of each borrowing by the Borrower under the Loan Agreement on and as of such date of borrowing as though made hereunder on and as of such date.

    10.   Covenants.  The Equity Guarantor hereby covenants and agrees with the Security Agent and the Secured Parties that, from and after the date of this Equity Contribution Guarantee until the Obligations are paid in full:

          (a)   Financial Statements; Other Information.  The Equity Guarantor shall furnish or cause to be furnished to the Administrative Agent and each Secured Party:
      (1)     (i)   as soon as available, but in any event within 120 days after the end of each fiscal year of the Equity Guarantor, a copy of the audited balance sheet of the Equity Guarantor as of the end of such fiscal year and the related audited statements of operations, changes in shareholders' equity and of cash flow of the Equity Guarantor for such fiscal year, setting forth in each case in comparative form the figures for the previous fiscal year, certified without a "going concern" or like qualification or exception, or qualification as to the scope of the audit, by Arthur Andersen, LLC or another independent public accounting firm of national standing selected by the Equity Guarantor and which is reasonably acceptable to the Administrative Agent; and

              (ii)   as soon as available, but in any event within 45 days after the end of each of the first three quarterly periods of each fiscal year of the Equity Guarantor, the unaudited balance sheet of the Equity Guarantor as of the end of such quarterly period and the related unaudited statements of operations and changes in shareholder's equity and of cash flow of the Equity Guarantor for such quarterly period and for the portion of the fiscal year through the end of such fiscal quarter, setting forth in each case in comparative form the figures for the previous period, certified by the chief executive officer or chief financial officer of the Equity Guarantor as fairly stating in all material respects the financial condition of the Equity Guarantor as at the end of such quarterly period and the results of its operations and its cash flows for such period (subject to normal year-end audit adjustments),

all such financial statements to be complete and correct in all material respects and to be prepared in reasonable detail and in accordance with GAAP applied consistently throughout the periods reflected therein (except for changes approved or required by the independent public accountants certifying such statements and disclosed therein);

     (2)   concurrently with the delivery of the financial statements of the Equity Guarantor referred to in clauses (1)(i) and (ii) of this Section 5.2(a), a certificate of a Responsible Officer of the Equity Guarantor, stating that, to the best of such Responsible Officer's knowledge after due inquiry, the Equity Guarantor during the period covered by such financial statements has observed and performed in all material respects all of its covenants and other agreements contained in this Equity Contribution Guarantee and the other Transaction Documents to which it is a party, and that such Responsible Officer is not aware of any Default or Event of Default under any Transaction Document to which it is a party at any time during such period or on the date of such certificate (or, if any such Default or Event of Default shall have occurred, a statement setting forth the nature thereof and the steps being taken by the Equity Guarantor to remedy the same); and

     (3)   promptly, such additional information regarding the business, affairs, operations and financial condition of the Equity Guarantor as any Secured Party may reasonably request.

          (b)   Maintenance of Existence, Properties, Etc.  The Equity Guarantor shall at all times preserve and maintain its legal existence as a validly existing corporation under the laws of its jurisdiction of incorporation, its qualification to do business in each other jurisdiction where the failure to so qualify could reasonably be expected to have a material adverse effect on its ability to perform its obligations hereunder and other material rights, franchises, privileges and consents necessary for the maintenance of its existence and the conduct of its business.

     11.   Authority of Security Agent.  (a)   The Equity Guarantor acknowledges that the rights and responsibilities of the Security Agent under this Equity Contribution Guarantee with respect to any action taken by the Security Agent or the exercise or non-exercise by the Security Agent of any option, right, request, judgment or other right or remedy provided for herein or resulting or arising out of this Equity Contribution Guarantee shall, as between the Security Agent and the Secured Parties, be governed by the Loan Agreement, the other Financing Documents and by such other agreements with respect thereto as may exist from time to time among them, but, as between the Security Agent and the Equity Guarantor, the Security Agent shall be conclusively presumed to be acting as Security Agent for the Secured Parties with full and valid authority so to act or refrain from acting, and the Equity Guarantor shall not be under any obligation, or entitlement, to make any inquiry respecting such authority.

          (b)   The Equity Guarantor agrees that the Security Agent (acting for the benefit of the Secured Parties) and any assignee thereof shall be entitled to enforce this Equity Contribution Guarantee in its own name and to exercise any and all rights of the Borrower under this Equity Contribution Guarantee in accordance with the terms hereof (either in its own name or in the name of the Borrower as the Security Agent may elect), and the Equity Guarantor and the Borrower agree to comply and cooperate in all respects with such exercise.  Without limiting the generality of the foregoing, the Security Agent and any assignee thereof shall have the full right and power to enforce directly against the Equity Guarantor all obligations of the Equity Guarantor under this Equity Contribution Guarantee, and otherwise to exercise all remedies available to the Borrower hereunder and to make all demands and give all notices and make all requests (either in its own name or in the name of the Borrower, as the Security Agent may elect) required or permitted to be made or given by the Borrower under this Equity Contribution Guarantee, and the Equity Guarantor acknowledges and agrees that any such action taken by the Security Agent shall be deemed effective for all purposes of this Equity Contribution Guarantee to the same extent as if such action had been taken directly by the Borrower.  If the Equity Guarantor shall receive inconsistent directions from the Borrower and the Security Agent, the directions of the Security Agent shall be deemed the effective directions, and the Equity Guarantor shall accordingly comply with such directions of the Security Agent.

     12.   Consent.  The Equity Guarantor hereby consents to the terms and provisions of the Borrower Security Agreement and each of the other Transaction Documents, including, without limitation, the assignment by the Borrower of all of its right, title and interest in, to and under this Equity Contribution Guarantee to the Security Agent pursuant to the terms of the Borrower Security Agreement.

     13,   Notices.  All notices, requests and demands to or upon the Security Agent, any Secured Party or the Equity Guarantor to be effective shall be in writing (or by telex, fax or similar electronic transfer confirmed in writing) and shall be deemed to have been duly given or made  when delivered by hand or  if given by mail, when deposited in the mails by certified mail, return receipt requested, or  if by telex, fax or similar electronic transfer, when sent and receipt has been confirmed, addressed as follows:

          (a)   if to the Borrower, the Security Agent or any Secured Party, at its address or transmission number for notices provided in subsection 12.2 of the Loan Agreement; and

          (b)   if to the Equity Guarantor, at its address or transmission number for notices set forth under its signature below.

     The Security Agent, each Secured Party and the Equity Guarantor may change its address and transmission numbers for notices by notice in the manner provided in this Section.

     14.   Severability.  Any provision of this Equity Contribution Guarantee which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

     15.   Integration.  This Equity Contribution Guarantee represents the agreement of the Equity Guarantor with respect to the subject matter hereof and there are no promises or representations by the Borrower, the Security Agent or any Secured Party relative to the subject matter hereof not reflected herein.

     16.   Amendments in Writing; No Waiver; Cumulative Remedies.  (a)   None of the terms or provisions of this Equity Contribution Guarantee may be waived, amended, supplemented or otherwise modified except by a written instrument executed by the Equity Guarantor, the Borrower and the Security Agent, provided that any provision of this Equity Contribution Guarantee may be waived by the Security Agent and the Secured Parties in a letter or agreement executed by the Security Agent or by telex or facsimile transmission from the Security Agent.

          (b)   Neither the Borrower, the Security Agent nor any Secured Party shall by any act (except by a written instrument pursuant to paragraph (a) hereof), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default or in any breach of any of the terms and conditions hereof.  No failure to exercise, nor any delay in exercising, on the part of the Borrower, the Security Agent or any Secured Party, any right, power or privilege hereunder shall operate as a waiver thereof.  No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  A waiver by the Borrower, the Security Agent or any Secured Party of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which the Borrower, the Security Agent or such Secured Party would otherwise have on any future occasion.

          (c)   The rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights or remedies provided by law.

     17.   Section Headings.  The section headings used in this Equity Contribution Guarantee are for convenience of reference only and are not to affect the construction hereof or be taken into consideration in the interpretation hereof.

     18.   Successors and Assigns.  This Equity Contribution Guarantee shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns, provided that neither the Equity Guarantor nor the Borrower may assign nor otherwise transfer any of its rights or obligations hereunder (other than the assignments by the Borrower in favor of the Security Agent pursuant to the Security Agreement) without the prior written consent of each of the Lenders.

     19.   Governing Law.  This Equity Contribution Guarantee shall be governed by, and construed and interpreted in accordance with, the law of the State of New York.

     20.   Counterparts.  This Equity Contribution Guarantee may be executed by one or more of the parties hereto on any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  A set of the copies of this Equity Contribution Guarantee signed by all the parties shall be lodged with the Borrower and the Security Agent.

     21.   Submission to Jurisdiction; Waivers.  The Equity Guarantor hereby irrevocably and unconditionally:

          (a)   submits for itself and its property in any legal action or proceeding relating to this Equity Contribution Guarantee and the other Transaction Documents, or for recognition and enforcement of any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of the State of New York, the courts of the United States of America for the Southern District of New York, and appellate courts from any thereof;

          (b)   consents that any such action or proceeding may be brought in such courts and waives any objection that it may now or hereafter have to the venue of any such action or proceeding in any such court or that such action or proceeding was brought in an inconvenient court and agrees not to plead or claim the same;

          (c)   agrees that nothing herein shall affect the right to effect service of process in any manner permitted by law or shall limit the right to sue in any other jurisdiction; and

          (d)   waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any legal action or proceeding referred to in this Section any special, exemplary, punitive or consequential damages.

     22.   WAIVER OF JURY TRIAL.  THE EQUITY GUARANTOR, THE BORROWER AND THE SECURITY AGENT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS EQUITY CONTRIBUTION GUARANTEE OR ANY OTHER TRANSACTION DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.

 

 

          IN WITNESS WHEREOF, the undersigned has caused this Equity Contribution Guarantee to be duly executed and delivered by its duly authorized officer as of the day and year first above written.

COGENTRIX ENERGY, INC. 

By:                 s/Clay S. Coleman                    

Name:     Clay S. Coleman

Title:         Vice President - Project Finance

Address for Notices:

Cogentrix Energy, Inc.

9405 Arrowpoint Blvd.

Charlotte, North Carolina 28273

Attention: Chief Financial Officer

Telephone: 704-525-3800

Telecopy: 704-529-1006

With a copy to:

Cogentrix Caledonia Holdings I, Inc. 

9405 Arrowpoint Blvd.

Charlotte, North Carolina 28273

Attention: General Counsel 

Telephone: 704-525-3800

Telecopy: 704-529-1006

 

 

 

Acknowledged and Agreed:

CALEDONIA GENERATING, LLC, as Borrower

By: COGENTRIX CALEDONIA HOLDINGS I, INC., 

              its Manager

By:          s/Clay S. Coleman                    

Name:     Clay S. Coleman

Title:       Vice President - Project Finance

FIRST UNION NATIONAL BANK, 

           as Security Agent

By:                  s/James Long                   

Name:    James Long

Title:     Assistant Vice PresidentEXHIBIT 4.1

                              MATRIX BANCORP, INC.

          Amended and Restated Executive Deferred Compensation Plan

Section 1.  Purpose

1.01  Purpose.  Matrix Bancorp,  Inc. (the "Company"),  by action of its Board
      of  Directors  and its  shareholders,  hereby  amends and  restates  the
      Matrix Bancorp,  Inc.  Executive  Deferred  Compensation  Plan ("Plan").
      The  Plan  is  intended  to  help  the  Company  and  its   subsidiaries
      ("Subsidiaries")  attract  and retain key  employees  and  directors  by
      allowing  them to defer a portion  of their  compensation.  The Plan was
      originally  adopted  effective  as of  January  1,  2001,  and is hereby
      amended and restated in its entirety effective as of such date.

      The Plan is to be construed as a plan maintained to provide deferred
      compensation to a "select group of management or highly compensated
      employees" within the meaning of Section 201(2) of the Employee Retirement
      Income Security Act of 1974 ("ERISA"), as amended from time to time. The
      Plan is intended to be exempt from the participation, vesting, funding and
      fiduciary requirements of Title I of ERISA, to the fullest extent
      permitted under the law. The Plan shall at all times be "unfunded" within
      the meaning of ERISA and the Internal Revenue Code of 1986, as amended
      from time to time.

1.02  Gender and Number. Where the context permits, words in any gender shall
      include any other gender, words in the singular shall include the plural,
      and the plural shall include the singular.

Section 2.  Definitions.  As used herein,  the following  terms shall have the
meaning indicated:

2.01  Account shall mean the bookkeeping account(s) established to record the
      interest of a Participant under the Plan. A Participant's Account shall
      consist of the value of any Compensation amounts the Participant elects to
      defer, any Matching Contributions made by the Company, and any income
      credited or debited thereto.

2.02  Beneficiary shall mean the person or persons entitled to receive a
      distribution under the Plan in the event of a Participant's death.

2.03  Board shall mean the Board of Directors of the Company.

2.04  Change of Control event shall mean any of the following (other than as a
      result of a public offering of shares of the Company):

     (a)  Any transaction (which shall include a series of transactions or a
          transaction occurring pursuant to a plan) that has the result that
          shareholders of the Company immediately before such transaction cease
          to own at least 51% of (x) the voting stock of the Company or (y) any
          entity that results from the participation of the Company in a
          reorganization, consolidation, merger, liquidation or any other form
          of corporate transaction;
<PAGE>

     (b)  A merger, consolidation, reorganization, liquidation or dissolution in
          which the Company does not survive;

     (c)  A sale, lease, exchange or other disposition of all or substantially
          all of the property and assets of the Company; or

     (d)  The adoption of a resolution by the Board to the effect that any
          person or entity has acquired effective control of the business and
          affairs of the Company.

     Notwithstanding the foregoing, a Change of Control shall not be deemed to
     have occurred if there is consummated any transaction (or series of
     integrated transactions) immediately following which the record holders of
     the voting securities of the Company immediately prior to such transaction
     continue to have substantially the same proportionate ownership in the
     entity which owns all or substantially all of the assets of the Company
     immediately following such transaction.

2.05 Code shall mean the Internal Revenue Code of 1986, as amended from time to
     time, all successor laws thereto, and any regulations or guidance
     promulgated thereunder. Where the Plan refers to a particular section of
     the Code, the reference shall also apply to any successor to that section.

2.06 Common Stock shall mean the Company's common stock, par value $.0001 per
     share.

2.07 Compensation shall mean the actual cash remuneration paid to an Employee or
     Director by the Employer in consideration of services rendered.
     Compensation may include base salary, bonus, commission, incentive,
     directors' fees, etc. Compensation does not include relocation allowances
     or any reimbursement paid to Employee or Director in connection with his
     employment or service.

2.08 Deferral Election shall mean an election made under Section 5.01.

2.09 Director shall mean a member of the Board or an advisory director of the
     Board.

2.10 Disability shall mean the Total Disability of a Participant, as defined in
     the Matrix Bancorp, Inc. Long Term Disability Insurance Plan.

2.11 Eligible Person shall mean (a) an Employee of the Employer earning annual
     Compensation of at least $120,000, (b) a member of the Board of Directors,
     including advisory directors, of the Company, or (c) such others selected
     by the Board in its sole and absolute discretion, to make Compensation
     Deferral Elections under the Plan pursuant to Section 5.01 (a) and (b).
     However, an otherwise Eligible Person shall not be eligible to make such
     Deferral Elections and any prior Deferral Elections shall become invalid
     following any distribution of benefits under the Plan pursuant to Section
     7.

2.12 Employee shall mean any person who is an employee of the Company or who
      is an employee of any Subsidiary.
<PAGE>

2.13 Employer shall mean Matrix Bancorp, Inc. or any Subsidiary to which the
     Employee provides services in exchange for Compensation.

2.14 Entry Date shall mean January 1 of each Plan Year, except that a newly
     Eligible Person may enter the Plan other than on January 1 in accordance
     with Section 4.02.

2.15 Matching Contribution shall mean a contribution, as described in Section
     5.03 which is determined annually by the Board.

2.16 Participant shall mean an Eligible Person who has filed a completed and
     executed Deferral Election Agreement and Deferral Enrollment Agreement with
     the Administrator and is participating in the Plan in accordance with the
     provisions of Section 5.

2.17 Payout Date shall mean the earlier of (i) the date on which the Participant
     elected pursuant to his completed and executed Enrollment Election
     Agreement, to commence receiving deferred monies or (ii) the Participant's
     date of Termination, Retirement, death or Disability. The date the
     Participant elects for distribution shall be at least five (5) years from
     the date of original deferral.

2.18 Penalty shall mean twenty-five percent (25%) of the Participant's vested
     Account balance.

2.19 Plan Administrator shall mean the Board or any designated committee of the
     Board.

2.20 Plan Year shall mean the calendar year (January 1 - December 31).

2.21 Retirement shall mean a Participant ceasing to be an Employee or Director
     on or after attainment of any combination of age and full years of service
      (measured on an employment anniversary basis) equal to sixty-five (65).

2.22 Subsidiary shall mean any corporation in any unbroken chain of corporations
     beginning with the Company, if, at the time of reference, each of the
     corporations other than the last corporation in the unbroken chain owns
     stock possessing 50% or more of the total combined voting power of all
     classes of stock in one of the other corporations in such chain.

2.23 Termination shall mean termination of employment or termination of a
     Director's service on the Board, other than by reason of Retirement, death
     or Disability.

2.24 Valuation Date means the date(s) specified by the Plan Administrator as of
     which the value of a Participant's Account is determined.

Section 3.  Administration of the Plan

3.01 Administration. This Plan shall be administered by the Plan Administrator.
<PAGE>

     The Plan Administrator shall have all powers necessary or appropriate to
     carry out the provisions of the Plan. The Plan Administrator may, from time
     to time, establish rules for the administration of the Plan and the
     transaction of the Plan's business.

     The Plan Administrator shall have the exclusive right to make any finding
     of fact necessary or appropriate for any purpose under the Plan, including,
     but not limited to, the determination of eligibility for and amount of any
     benefit.

     The Plan Administrator shall have the exclusive right to interpret the
     terms and provisions of the Plan and to determine any and all questions
     arising under the Plan or in connection with its administration, including,
     without limitation, the right to remedy or resolve possible ambiguities,
     inconsistencies, or omissions by general rule or particular decision, all
     in its sole and absolute discretion.

     All findings of fact, determinations, interpretations and decisions of the
     Plan Administrator shall be conclusive and binding upon all person(s)
     having or claiming to have any interest or right under the Plan and shall
     be given the maximum deference allowed by law.

3.02 Tax Withholding. The Company or the appropriate Employer may withhold from
     any payment under this Plan any and all withholdings under all
     jurisdictions including federal, state, local or foreign taxes required by
     law to be withheld with respect to the payment and any sum the Company or
     the appropriate Employer may reasonably estimate as necessary to cover any
     taxes for which they may be liable and that may be assessed with regard to
     the payment.

Section 4.  Eligibility

4.01 Participation shall be limited to a "select group of management of highly
     compensated employees" within the meaning of ERISA Section 201(2).

4.02 The Plan Administrator may permit any person who first becomes an Eligible
     Person on or after the first day of a Plan Year to enroll in the Plan
     within 30 days following his eligibility. The Deferral Election shall be
     effective only for Compensation earned after the 30-day period.

4.03 The Plan Administrator may permit an Eligible Person to enroll in the Plan
     and commence participation in the Plan on any Entry Date during a Plan
     Year.

4.04 Once a Participant makes a Deferral Election of Compensation, his election
     cannot be changed during a Plan Year, except as provided under Section 4.05
     or Section 7.10.

4.05 If a Participant no longer satisfies the definition of "Eligible Person"
     or, in the Plan Administrator's discretion, no longer satisfies the
     requirements of Section 4.01, the Participant's Deferral Election shall
     automatically and immediately terminate. At such time, the Participant will
     be deemed to have reached a Payout Date as defined in Section 2.16 and will
     be eligible for a benefit as explained in Section 7.
<PAGE>

4.06 Participation in or eligibility for the Plan shall not constitute a
     guarantee or contract of employment and shall not give any Employee the
     right to be retained in the employment of the Employer. Nor shall
     participation in or eligibility for constitute any right to claim any
     benefit under the terms of the Plan, unless this right or claim has
     specifically vested under the terms of the Plan.

Section 5.  Deferral Elections and Matching Contributions

5.01 Deferral Elections. A Participant may elect to defer a specified amount or
     percentage of his Compensation. The maximum deferral allowed is one hundred
     percent (100%), less any required withholding under Section 5.02, of the
     Participant's Compensation.

     A Participant who wishes to defer receipt of all or a portion of any
     Compensation to be earned during the Plan Year shall provide the Plan
     Administrator with a completed and executed Deferral Election Agreement and
     Deferral Enrollment Agreement according to the rules established by the
     Plan Administrator in its sole and absolute discretion. A Participant's
     election to defer any Compensation shall be received by the Plan
     Administrator no later than the next Entry Date to which the election will
     take effect.

5.02 Rules Regarding Withholdings. No Participant shall be allowed to defer
     Compensation to the extent the Company determines that such Compensation
     should be withheld to pay the Participant's portion of taxes under the
     Federal Insurance Contributions Act ("FICA"), and federal, state or local
     income taxes, payments required to maintain coverage for the Participant or
     the Participant's dependents under any welfare plan or program of the
     Company, or any similar payment.

5.03 Matching Contributions. The Employer, in its discretion, may make Matching
     Contributions for each Plan Year on behalf of each Participant who elects
     to defer a portion of his Compensation.

     (a)  The amount of the Matching Contribution, if any, shall be determined
          by the Board and may be tied to Company and/or individual performance.
          The Board, in its discretion, may establish a maximum contribution
          amount for any Plan Year.

     (b)  A Participant will be eligible to receive a Matching Contribution if
          employed or if serving as a Director on December 31st of the year in
          which the Matching Contribution relates; provided, however, such
          requirement shall not apply if the Participant separates from service
          prior to December 31 of any Plan Year by reason of death, Disability
          or Retirement.

5.04  Investment Equivalents.

     (a)  General Rule. Except to the extent other arrangements are established
          by the Plan Administrator, each Participant's Account under the Plan
          shall be credited (or debited) with investment gains (or losses)
          corresponding to investment equivalents established by the Plan
          Administrator and selected by the Participant. The Participant's
          election of the investment equivalent or equivalents upon which such
          crediting and debiting will be based, including the right to change
          such
<PAGE>

          election with respect to his future contributions and his existing
          account balance, shall be handled in the manner prescribed by the Plan
          Administrator. Neither the Company, nor any Subsidiary, nor the
          Trustee of the Rabbi Trust, shall be required to invest amounts
          corresponding to the investment equivalents. The investment
          equivalents available under the Plan from time to time shall be
          separately communicated to Participants from time to time and may, in
          the Plan Administrator's discretion, vary from Participant to
          Participant or from contribution source to contribution source.

     (b)  Common Stock of Company. Without limiting the foregoing provisions of
          this Section, the Board, in its sole discretion, may designate Common
          Stock of the Company as investment equivalent with respect to all or
          any portion of a Participant's Account. For each Plan Year, the Board
          may also designate that any Matching Contribution for such Plan Year
          be considered a "Matching Stock Contribution," in which case, such
          contribution will be deemed invested solely in shares of Common Stock
          and Participants shall not have the ability to redirect such amounts
          into other investment equivalents. Each Participant's Account shall be
          credited with any cash dividends and other distributions of securities
          or property attributable to shares of Common Stock credited to a
          Participant's Account at the same time and in the same manner such
          dividends or distributions would have been paid if such Account were
          actually invested in Common Stock.

Section 6.  Vesting; Employment Taxes

6.01  General. Each Participant shall be 100% vested in any Compensation
      deferred. Except as provided in Section 6.02, a Participant's Matching
      Contribution for each Plan Year (if any) shall become vested and
      non-forfeitable based on the following vesting schedule:

                  Years of Vesting Service            Vested Percentage

                        1                               20%
                        2                               40%
                        3                               60%
                        4                               80%
                        5                               100%

     For purposes of the foregoing, "Years of Vesting Service" means the total
     number of full Plan Years in which a Participant has been employed by the
     Employer or has served on the Board following the Plan Year with respect to
     which any Matching Contribution relates. By way of example, a Matching
     Contribution attributable to year 2001 shall vest in 20% increments
     beginning in year 2002; and a Matching Contribution attributable to year
     2002 shall vest in 20% increments beginning in year 2003. Any partial Plan
     Year of employment or Board membership shall not be counted.

6.02 Special. Notwithstanding Section 6.01 above, a Participant shall have a
     nonforfeitable right or vested interest in his entire Account (including
     Matching Contributions) upon the Participant's Retirement, death, or
     Disability or in the event of a Change of Control.
<PAGE>

6.03 FICA and Other Taxes. For each Plan Year during which a Participant vests
     in a new portion of his Account, the Company shall remit the Participant's
     share of FICA and other employment taxes, if any, that are attributable to
     such vesting.

Section 7.  Benefits Distribution

7.01 A Participant is eligible for a benefit under the Plan when he has reached
     a Payout Date (as defined in Section 2). The benefit will be based on the
     total vested value of the Account of the Participant.

7.02 Benefit Upon Termination. A Participant's Termination shall create a lump
     sum distribution of the vested balance of the Participant's Account
     notwithstanding the Participant's Deferral Enrollment Agreement. Payment of
     the vested balance of the Participant's Account shall be made no later than
     60 days following the end of the calendar year during which the Participant
     incurs a Termination.

7.03 Benefit Upon Disability. A Participant's Disability shall create a lump sum
     distribution of the vested balance of the Participant's Account
     notwithstanding the Participant's Deferral Enrollment Agreement. Payment of
     the vested balance of the Participant's Account shall be made no later than
     60 days following the end of the calendar year during which the Participant
     incurs a Disability.

7.04 Benefit Upon Change of Control. A Change of Control, as defined in Section
     2.04, shall create a lump sum distribution of the vested balance of the
     Participant's Account notwithstanding the Participant's Deferral Enrollment
     Agreement. Payment of the vested balance of the Participant's Account shall
     be made as soon as administratively practicable following such Change of
     Control. However, the Participant's Deferral Enrollment Agreement shall
     remain in effect if the surviving corporation assumes this Plan.

7.05 Benefit Amount. Any amount to be distributed shall be determined as of the
     Valuation Date coincident with or immediately preceding the date of
     distribution. All amounts payable under the Plan shall be paid in cash;
     provided, however, any amounts attributable to Matching Stock Contributions
     (as defined in Section 5.04(b)) shall be paid exclusively in whole shares
     of Common Stock and ignoring fractional shares.

7.06 Benefit Upon Retirement or Attainment of Scheduled Payout Date. Upon a
     Participant's Retirement or attainment of his Payout Date, the vested
     balance of the Participant's Account shall be distributed as soon
     administratively practicable in the form specified in the Participant's
     Deferral Enrollment Agreement.

      The Deferral Enrollment Agreement shall state:

     (a)  the Payout Date with respect to the Participant's Account, and

     (b)  the form of payment, whether in one lump sum or annual installments
          over 5 or 10 years.
<PAGE>

7.07 Rules Regarding Modification of Deferral Enrollment Agreement ("Modified
     Enrollment Agreement"). The form and timing of payment may be modified by
     the Participant if communicated to the Plan Administrator prior to the end
     of the Plan Year preceding: (i) the scheduled lump sum payment or
     installment payment, or (ii) Retirement, provided however that such
     modifications must be made at least one year prior to the scheduled payment
     date.

7.08 Participant's Death.

     (a)  If a Participant dies after payment of benefits under the Plan have
          commenced, payments shall continue to be made in the same form and for
          the same duration as elected by the Participant. However, such
          distributions of benefits shall be made to his Beneficiary. The
          Beneficiary may elect to receive a lump sum payment of the benefits
          with the approval of the Plan Administrator.

     (b)  If a Participant dies prior to the commencement of a payment of his
          benefits under the Plan, distributions of his Account shall be made to
          his Beneficiary. The payment shall be made in one lump sum no later
          than 60 days following the end of the calendar year during which the
          Participant's death occurs.

     (c)  Each Participant shall submit a written, signed, and dated list of his
          designated Beneficiary to the Plan Administrator on a form approved by
          the Plan Administrator ("Matrix Beneficiary Designation Form"). The
          Participant may change the Beneficiary at any time without the consent
          of any prior Beneficiary. If no Beneficiary survives the Participant
          or if no valid Beneficiary designation is in effect, the Participant's
          Beneficiary shall be his estate.

7.09 Emergency Benefit. In the event that the Plan Administrator, on written
     petition of the Participant, determines, in its sole discretion, that the
     Participant has suffered an unforeseeable financial emergency, the Company
     shall pay to the Participant, as soon as practicable following such
     determination, an amount up to the balance of his deferrals as necessary to
     meet the emergency (the "Emergency Benefit"). For purposes of the Plan, an
     unforeseeable financial emergency is an unexpected need for cash arising
     from an illness, casualty loss, sudden financial reversal, or other such
     unforeseeable occurrence. The amount of the benefits otherwise payable
     under the Plan shall thereafter be adjusted to reflect the payment of the
     Emergency Benefit. Applications for Emergency Benefits and the
     determinations thereon by the Plan Administrator shall be in writing, and a
     Participant may be required to furnish written proof of the financial
     emergency. Any Participant who receives an Emergency Benefit will be
     precluded from making new deferrals under the Plan until the next
     enrollment period that occurs at least twelve (12) months following payment
     of the Emergency Benefit. No payment shall be made under this Section if
     the Plan Administrator determines that such payment would leave any other
     amounts deferred hereunder to be deemed constructively received under the
     Code.

7.10 Early Distribution. Notwithstanding a Participant's election under Section
     5, a Participant may elect to receive his entire vested Account in a single
     lump sum payment of the vested balance of the Participant's Account less an
     immediate Penalty as defined in
<PAGE>

     Section 2.18. Any Participant who receives a distribution under this
     Section 7.10 will be precluded from making new deferrals under the Plan
     until the next enrollment period that occurs at least 24 months following
     payment of the distribution amount.

7.11 Small Benefit. In the event the Plan Administrator determines that the
     vested balance of the value of a Participant's Account is less than $25,000
     at the time of commencement of payment of his benefits, or that the portion
     of the value of the balance of the Participant's Account payable to any
     Beneficiary is less than $25,000 at the time of commencement of payment of
     a survivor benefit to such Beneficiary, the Plan Administrator may pay the
     benefit in the form of a lump sum payment, notwithstanding any provision of
     this Section 7 to the contrary. Such lump sum payment shall be equal to the
     vested balance of the Participant's Account or the portion thereof payable
     to a Beneficiary.

7.12 Tax Withholdings. To the extent required by law in effect at the time
     payments of deferred amounts are made, the Company shall withhold from
     payments made hereunder the taxes required to be withheld by the federal or
     any state or local governments.

Section 8.  Rabbi Trust

8.01 Rabbi Trust. The Company shall maintain a single Rabbi Trust as part of the
     Plan to implement the provisions of the Plan.

8.02 Contributions. The Employer shall make contributions to the Rabbi Trust
     from time to time. Contributions shall be made equal to the amounts
     deferred pursuant to each respective Participant's Deferral Election
     Agreement.

8.03 Investments of the Rabbi Trust. The Company shall vest in itself or the
     trustee of the Rabbi Trust, responsibility for the management and control
     of the assets of the Rabbi Trust.

     No Participant or Beneficiary shall have any interest whatsoever in any
     specific asset of the Company, Subsidiaries or Rabbi Trust. To the extent
     that any person acquires a right to receive payments under the Plan, such
     right shall be no greater than the rights of any unsecured general creditor
     of the appropriate Employer.

8.04 No Reversion. Except as specified below and in the Rabbi Trust agreement,
     the Company and the Subsidiaries shall not have any right, title, or
     interest in the Contributions made to (or earnings under) the Rabbi Trust.
     No part of the Rabbi Trust shall revert to any Employer except upon
     complete termination of the Plan after the satisfaction of all fixed and
     contingent liabilities of the Plan.

Section 9.  Amendment and Termination of the Plan

9.01 Amendment and Termination. While the Company expects and intends to
     continue the Plan, the Company must reserve and hereby reserves the right
     to amend or to terminate the Plan in any way, at any time, for any reason;
     except that no amendment shall reduce a Participant's benefits to less than
     the amount the Participant would have been entitled to
<PAGE>

     receive if the Participant had resigned from the employment or Board
     service on the effective date of amendment or termination.

     In the event a Subsidiary ceases to qualify as a "Subsidiary" of the
     Company has herein defined, such Subsidiary shall terminate its
     participation in the Plan unless the Board, in its sole and absolute
     discretion, approves the continued participation of such former Subsidiary.
     In either case, the Board shall coordinate in good faith with the
     Subsidiary to effectively carry out the intent of the Plan with respect to
     the employees of that former Subsidiary.

9.02 Distribution Upon Termination of the Plan. If the Plan is terminated with
     respect to one or more participating Employers before all benefits under
     the Plan have been paid, distributions shall be made (or benefit payments
     continued) pursuant to the elections made on the Participant election
     forms. However, the Board may, in its sole and absolute discretion, direct
     that distribution be made in any form at any time selected by the Board,
     regardless of whether payments of benefits under the Plan have commenced.

Section 10.  General Provisions

10.01 Applicable Laws. The Plan shall be construed and administered under the
      laws of the State of Colorado, without regard to conflict of laws
      provisions, to the extent that such laws are not pre-empted by the laws of
      the United States of America.

10.02 Securities Laws Limitation.

      (a)   Notwithstanding any provision in this Plan to the contrary, no
            shares of Common Stock will be issued pursuant to the Plan until
            such shares have been duly listed or approved for quotation, upon
            official notice of issuance, on the National Market System of The
            Nasdaq Stock Market, Inc. and such other exchanges, if any, as the
            Board may determine, and a registration statement under the
            Securities Act of 1933, as amended, with respect to such shares has
            become, and remains, effective.

      (b)   100,000 shares of Common Stock are authorized for issuance to
            Participants under this Plan, subject to adjustment as set forth in
            sub-paragraph (c) below. This authorization may be increased from
            time to time by approval of the Board, and if such approval is
            required, by the shareholders of the Company. In the discretion of
            the Board, the shares of Common Stock payable under the Plan may
            consist of newly issued shares or shares reacquired by the Company.
            The Company will at all times during the term of the Plan retain as
            authorized and unissued shares of Common Stock at least the number
            of shares from time to time required under the provisions of the
            Plan, or otherwise assure itself of its ability to perform its
            obligations hereunder.

      (c)   If there is any change in the Common Stock and/or in the corporate
            structure of the Company, through merger, consolidation, division,
            share exchange, combination, reorganization, recapitalization, stock
            dividend, stock split, spin-off, split up, dividend in kind or other
            change in the corporate structure or distribution to the
            shareholders, appropriate adjustments may be made by the Board (or,
            if the
<PAGE>

            Company is not the surviving corporation in any such transaction,
            the board of directors of the surviving corporation) in the
            aggregate number and kind of shares subject to the Plan, and the
            number and kind of shares which may be issued under the Plan.
            Appropriate adjustments may also be made in the terms of any
            Employer contributions previously approved by the Board upon the
            occurrence of any such events upon any equitable basis determined by
            the Board in its discretion.

10.03 Benefits Payable from General Assets. Amounts payable hereunder shall be
      paid exclusively from the general assets of the Employer, and no person
      entitled to payment hereunder shall have any claim, right, security
      interest, or other interest in any fund, trust, account, insurance
      contract, or asset of the Employer which may be looked to for such
      payment, other than the right of an unsecured general creditor against the
      Employer, in respect of the Account of such Participant established
      hereunder. There shall be no ability to obtain the general assets of the
      Employer except in the case of bankruptcy or insolvency.

10.04 Cost of the Plan. All costs of the Plan, including the administration
      thereof, shall be borne by the Company and no contributions from
      Participants shall be required or permitted.

10.05 Severability. If any provision of the Plan is held illegal or invalid, the
      illegality or invalidity shall not affect its remaining parts. The Plan
      shall be construed and enforced as if it did not contain the illegal or
      invalid provision.

10.06 No Assignment of Rights. No interest, right, or claim in or to any payment
      hereunder shall be assignable, transferable, or subject to sale, mortgage,
      pledge, hypothecation, commutation, anticipation, garnishment, attachment,
      execution, or levy of any kind. The Company and Subsidiaries shall not
      recognize any attempt to assign, transfer, sell, mortgage, pledge,
      hypothecate, commute or anticipate the same, except to the extent required
      by law.

10.07 Successors to Company. The Plan shall inure to the benefit of, and shall
      be binding upon, the Company and the Participants and their successors or
      assigns.

10.08 Legal Fees to Enforce Rights After Change of Control. The Company is aware
      that upon the occurrence of a Change of Control, the Board (which might
      then be composed of new members) or a shareholder of the Company, or of
      any successor corporation might then cause or attempt to cause the Company
      or such successor to refuse to comply with its obligations under the Plan
      and might cause or attempt to cause the Company to institute, or may
      institute, litigation seeking to deny Participants the benefits intended
      under the Plan.

      In these circumstances, the purpose of the Plan could be frustrated.
      Accordingly, if, following a Change of Control, it should appear to any
      Participant that the Company has failed to comply with any of its
      obligations under the Plan or any agreement thereunder or, if the Company
      or any other person takes any action to declare the Plan void or
      unenforceable or institutes any litigation or other legal action designed
      to deny, diminish
<PAGE>

      or to recover from any Participant the benefits intended to be provided,
      then the Company irrevocably authorizes such Participant to retain counsel
      of his or her choice at the expense of the Company to represent such
      Participant in connection with the initiation or defense of any litigation
      or other legal action, whether by or against the Company or any director,
      officer, shareholder or other person affiliated with the Company or any
      successor thereto in any jurisdiction.

Section 11. Claims Procedures

11.01 Presentation of Claim. Any Participant or Beneficiary of a deceased
      Participant (such Participant or Beneficiary being referred to below as a
      "Claimant") may deliver to the Plan Administrator a written claim for a
      determination with respect to the amounts distributable to such Claimant
      from the Plan. If such a claim relates to the contents of a notice
      received by the Claimant, the claim must be made within 60 days after such
      notice was received by the Claimant. The claim must state with
      particularity the determination desired by the Claimant. All other claims
      must be made within 180 days of the date on which the event that caused
      the claim to arise occurred. The claim must state with particularity the
      determination desired by the Claimant.

11.02 Notification of Decision. The Plan Administrator shall consider a
      Claimant's claim within a reasonable time, and shall notify the Claimant
      in writing:

            (i)   that the Claimant's requested determination has been made, and
                  that the claim has been allowed in full; or

            (ii)  that the Plan Administrator has reached a conclusion contrary,
                  in whole or in part, to the Claimant's requested
                  determination, and such notice must set forth in a manner
                  calculated to be understood by the Claimant:

                  (1)   the specific reason(s) for the denial of the claim, or
                        any part of it;

                  (2)   specific reference(s) to pertinent provisions of the
                        Plan upon which such denial was based;

                  (3)   a description of any additional material or information
                        necessary for the Claimant to perfect the claim, and an
                        explanation of why such material or information is
                        necessary; and

                  (4)   an explanation of the claim review procedure set forth
                        in Section 11.03 below.

11.03 Review of a Denied Claim. Within 60 days after receiving a notice from the
      Plan Administrator that a claim has been denied, in whole or in part, a
      Claimant (or the Claimant's duly authorized representative) may file with
      the Plan Administrator a written request for a review of the denial of the
      claim. Thereafter, but not later than 30 days after the review procedure
      began, the Claimant (or the Claimant's duly authorized representative):
<PAGE>

            (i)   may review pertinent documents;

            (ii)  may submit written comments or other documents; and/or

            (iii) may request a hearing, which the Plan Administrator, in its
                  sole discretion, may grant.

11.04 Decision on Review. The Plan Administrator shall render its decision on
      review promptly, and not later than 60 days after the filing of a written
      request for review of the denial, unless a hearing is held or other
      special circumstances require additional time, in which case the Plan
      Administrator's decision must be rendered within 120 days after such date.
      Such decision must be written in a manner calculated to be understood by
      the Claimant, and it must contain:

            (i)   specific reasons for the decision;

            (ii)  specific reference(s) to the pertinent Plan provisions upon
                  which the decision was based; and

            (iii) such other matters as the Plan Administrator deems relevant.

11.05 Legal Action. A Claimant's compliance with the foregoing provisions of
      this Article 11 is a mandatory prerequisite to a Claimant's right to
      commence any legal action with respect to any claim for benefits under the
      Plan.

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