Document:

Exhibit 10.6

 

Emergency Roadside Assistance Servicing Agreement

 

THIS AGREEMENT is made as of January 1, 2011 (the “Effective Date”) by and among SIGNATURE’S NATIONWIDE MOTOR CLUB, INC. (hereinafter “SNAC”) with offices located at 51 W. Higgins Road, South Barrington, IL 60010, AFFINITY GROUP, INC. (hereinafter “AGI”), with offices located at 64 Inverness Drive East, Englewood, Colorado, 80112, and AFFINITY ROAD AND TRAVEL CLUB, INC. (hereinafter “ART”), with offices located at 64 Inverness Drive East, Englewood, Colorado, 80112.

 

WHEREAS, AGI, through ART, makes available roadside service programs to owners and operators of recreational vehicles within the United States, Canada, Mexico, Puerto Rico, and United States Virgin Islands; and

 

WHEREAS, SNAC is in the business of dispatching emergency roadside assistance services through a network of Independent Service Providers (as defined below) and providing various ancillary services; and

 

WHEREAS, AGI wishes to contract with SNAC to dispatch roadside assistance services and provide ancillary services to Members (or affiliates) of AGI’s membership clubs on the terms defined in greater detail herein; and

 

WHEREAS, SNAC wishes to provide such services itself, and by using Independent Service Providers, subject to the terms and conditions of this Agreement;

 

NOW, THEREFORE, in consideration of the promises contained in this Agreement, which the parties acknowledge to be sufficient, SNAC and AGI agree as follows:

 

Section 1.                                          Definitions.

 

Each of the following capitalized terms will have the meaning ascribed to it in this Section wherever they appear in this Agreement.

 

1.1                               “Additional Services” means all services provided by or through SNAC pursuant to this Agreement which are not ERS Services and for which  SNAC is entitled to compensation or reimbursement by AGI in accordance with the terms of this Agreement.

 

1.2                               “Agreement” means this contract effective January 1, 2011 including all Exhibits.

 

1.3                               “Approved Material” means any promotional material AGI uses to promote the Covered Services and that references SNAC.  SNAC may withdraw its previous approval in writing and in such case the promotional material shall no longer be Approved Material.

 

1.4                               “AGI Program” means a mutually agreed upon set of obligations between AGI and SNAC which are defined generally by this Agreement and specifically within a Program Exhibit hereto.

 

1.5                               “Call Center” means a facility that handles Member phone calls requesting Emergency Roadside Assistance and dispatches Independent Service Providers to 

 

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assist those Members.  An “SNAC Call Center” or “SNAC CSR” shall be a Call Center owned, operated or under the directional or contractual control of SNAC.

 

1.6                               “Claim” means any action, cause of action, suit, claim, demand, settlement, judgment, controversy, loss, obligation, damage, cost, liability, lien, fine, penalty, charge, court cost, reasonable attorneys’ fees and expenses, payment, liability and expense, asserted against, imposed upon, or incurred or suffered by an Indemnitee.

 

1.7                               “Covered Services” means the ERS Services and the Additional Services.

 

1.8                               “CSR” means Dispatch member service representative who receives a request for Disablement assistance from a Member.

 

1.9                               “Disablement” means one mechanical breakdown or other situation rendering a Member’s vehicle inoperable and unable to proceed under its own power, thereby entitling a Member to receive Covered Service(s). A Disablement may incorporate one or more Dispatches and Events.  A Disablement may be made up of one or multiple Dispatches from one or more Independent Service Provider using one or more pieces of equipment.

 

1.10                        “Dispatch” means the act of providing assistance to a Member by sending one or more Independent Service Providers to render Covered Service(s).

 

1.11                        “Effective Date” means the date identified in the preamble to this Agreement, above.

 

1.12                        “Emergency Roadside Assistance” means the delivery of ERS Services through Independent Service Providers, and other services as necessary in order to render the vehicle operable in order to proceed under its own power safely.

 

1.13                        “ERS Services” means the Emergency Roadside Services described under the following headings in Program Exhibit 1: Towing Coverage, Flat Tire Service, Battery Service, Lockout\Lost Key Service, Fuel\Fluid Delivery Service and/or RV Roadside Mechanical Repairs Service, and those other emergency roadside assistance services which may change from time to time upon both parties’ written approval.

 

1.14                        “Event” means a single ERS Service provided by a single service vehicle.

 

1.15                        “Indemnitee” means any person entitled to indemnification under this Agreement, including the non-indemnifying party, its parent, subsidiaries and affiliated entities, and each of their officers, directors, employees, agents, and representatives.

 

1.16                        “Indemnitor” means each indemnifying party when such party is obligated to defend an Indemnitee under this Agreement.

 

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1.17                        “Independent Service Provider” means an independent garage, Towing Network Provider, or other contractor that may be part of SNAC’s network and SNAC dispatches to perform ERS Services for Members.

 

1.18                        “Members” mean the members of AGI’s membership clubs, or AGI affiliates and customers, who are eligible to receive Covered Services under the terms of this Agreement.

 

1.19                        “Member Information” means personally identifiable information as defined by applicable law, which AGI or SNAC obtains with respect to a Member related to AGI’s or SNAC’s performance of the duties and obligations of this Agreement.

 

1.20                        “Notice” means any communication from one party to the other given according to the requirements of the Section of this Agreement entitled “Notices.”

 

1.21                        “Program Exhibit” means to an Exhibit attached to this Agreement either on the Effective Date or thereafter during the Term of this Agreement, sequentially numbered, and signed by both parties.

 

1.22                        “RV” is defined as the abbreviation for “recreational vehicle” and applies to any enclosed piece of equipment dually used as a temporary or full time travel home, used primarily for traveling and recreational personal pleasure and not in connection with any commercial or business enterprise.  Specific RV types include but are not limited to self-contained Motor Homes, Travel Trailers, 5th Wheel Trailers, Pop-up Camping Trailers, Slide-in Truck Campers, and Conversion Vans.

 

1.23                        “Towing Network Provider” means an independent towing facility that performs towing services for Members.

 

Section 2.                                          Covered Services.

 

2.1                               SNAC agrees to provide Covered Services to Members, on a sign-and-drive basis (unless other terms are specifically agreed to in writing by the Parties and set forth in this Agreement and/or a future amendment or modification hereto), who contact an SNAC Call Center.  SNAC shall provide the Covered Services to Members subject to SNAC’s ordinary and reasonable business practices, common industry standards, and this Agreement including the terms and conditions found in Program Exhibit 1.  SNAC shall provide Covered Services in Canada, Mexico, Puerto Rico, all fifty (50) United States and the District of Columbia, and United States Virgin Islands.  SNAC may suspend provision of Covered Services in any such jurisdiction if it determines that continuing to provide such Covered Services in such jurisdiction would violate an applicable law or regulation, or a degradation of the effectiveness of law enforcement agencies in such jurisdiction creates a material risk to SNAC or its employees, agents or contracted service providers; provided, however, that if such suspension, either individually or in the aggregate with other suspensions, has a material adverse effect on the rights or benefits of AGI under this Agreement, AGI shall have the right to terminate this Agreement upon sixty (60) days’ prior written notice.

 

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2.2                               SNAC will staff SNAC Call Centers adequately to meet the service level standards described in Program Exhibit 1 and any subsequent Program Exhibit. AGI will provide SNAC with AGI owned toll-free numbers for Members to contact SNAC Call Centers for Covered Services, the cost of which shall be the sole responsibility of SNAC.  SNAC shall dispatch Emergency Roadside Assistance to light, medium and heavy duty RVs, passenger automobiles, motorcycles, passenger vans, mini-vans, station wagons, sport utility vehicles, all terrain vehicle (ATV) trailers, personal watercraft (PWC) trailers, snowmobile trailers, and light, medium and heavy duty trucks, provided such vehicle (or, in the case of trailers or trailered vehicles, the connected towing vehicle) has experienced a Disablement and such vehicle or trailer is located: 1) on the Member’s property in an area reasonably accessible to an appropriate service vehicle; 2) if not on the Member’s property, within 100 feet of a hard-packed or graded dirt public road, paved street, driveway, parking lot, highway, freeway, expressway or adjacent shoulder, or 3) in a location reasonably accessible to an appropriate service vehicle.  Vehicle types eligible for Dispatch may be added or deleted as mutually agreed in writing by the Parties.  SNAC CSRs shall accept Member phone calls and shall dispatch Independent Service Providers to deliver Emergency Roadside Assistance to Members.  The CSR shall provide the Independent Service Provider appropriate dispatch information which may include the Member’s name, call-back telephone number, service requested, vehicle information, license plate information, breakdown location and the destination to which the vehicle is to be towed, and any other required or relevant information.  After contacting the Independent Service Provider, SNAC’s CSR will advise the Member of the name and telephone number of the Independent Service Provider, as well as the name and telephone number of the destination facility, and the approximate time it will take for the Independent Service Provider to arrive at the Member’s location (ETA).

 

2.3                               AGI and SNAC shall cooperate in providing training to SNAC CSRs about the features and characteristics of AGI’s Programs.  SNAC and AGI shall also cooperate in developing training materials and other resources to educate SNAC CSRs about AGI Programs pursuant to AGI’s certification training programs and schedules as described in greater detail in Program Exhibit 1.  AGI will submit to SNAC the terms, conditions and servicing requirements of all new AGI Programs prior to their implementation.  If, in the exercise of SNAC’s judgment, SNAC determines that AGI’s new Program will cause SNAC unreasonable systems or operational issues, the Parties shall each employ their best efforts to resolve such issues.  Such resolution may require modifications to AGI’s Program prior to launch.  At SNAC’s expense, SNAC will complete CSR training of new AGI Programs after AGI provides SNAC with complete information concerning the AGI Program, including all benefits and claims and service limits.  SNAC will make commercially reasonable efforts to service AGI’s Programs according to their terms, minimize CSR mistakes and address Member complaints and inquiries.  However, AGI acknowledges that occasional human error or mistakes in judgment by individual CSRs are contemplated within applicable service level standards and shall not otherwise constitute a breach of this Agreement.  Further, while SNAC may elect to make improvements in information technology, systems, or infrastructure in order to improve Member service, nothing in this Agreement shall be construed to require SNAC to make any such improvements.

 

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2.4                               SNAC will use its best efforts to dispatch an Independent Service Provider to all Members in need of Emergency Roadside Assistance.  However, AGI recognizes that in some instances, SNAC may be unable to locate an Independent Service Provider or that due to severe weather or other circumstances beyond SNAC’s control, no Independent Service Provider is available for dispatch for an extended period of time.  Further, Independent Service Providers may decline to provide Emergency Roadside Assistance on restricted, toll or private highways or in areas where it would be hazardous for Independent Service Providers’ vehicles to travel.  Therefore, SNAC does not guarantee availability of service other than that represented in the service level standards appearing in Program Exhibit 1, provided, that prior to declining service to any member, SNAC shall contact AGI customer service for AGI’s recommended resolution.  SNAC and AGI shall escalate any such situation to designated employees and shall cooperatively attempt to resolve the situation.  SNAC shall comply with any reasonable proposal by AGI to assist the Member and shall be responsible for the actual cost of Covered Services thereof. A proposal shall be deemed unreasonable if, in either party’s sole discretion, it would expose any individual or entity to a significant risk of personal harm, liability or litigation.

 

2.5                               In addition to dispatching Independent Service Providers to provide Emergency Roadside Assistance, SNAC will be responsible for maintaining its network of Independent Service Providers and paying the Independent Service Providers for the ERS Services performed.

 

2.6                               SNAC will be responsible for maintaining networks of tire and battery delivery providers, qualified mobile mechanics, mobile RV techs, and Repair Facilities, and other networks as required, described in Program Exhibit 1 as those networks are launched and expanded.

 

Section 3.                                          AGI Programs.

 

3.1                               The nature of each AGI Program and its affinity relationship with SNAC related to this Agreement shall be specified in one or more Program Exhibits.  In the event of a conflict between any term of this Agreement and a Program Exhibit, the terms of the Program Exhibit shall prevail.

 

3.2                               Material changes to any AGI Program that negatively impact SNAC’s costs and/or SNAC’s ability to maintain the quality of Covered Services without incurring additional costs shall be made only in a writing executed by authorized representatives of both parties.  Neither party shall have any obligation related to any material changes to an AGI Program until such change is agreed upon by the parties in writing.

 

3.3                               The nature and benefits of the Covered Services are as described in the applicable Program Exhibit (and in Section 2).  SNAC may make minor or incremental changes to the benefits of the Covered Services at its discretion, provided, that to the extent such changes are material or negatively impact AGI’s costs and/or the quality of Covered Services, or if the change conflicts with any term or representation appearing in any applicable AGI Member benefit brochure, such change shall require AGI’s prior written consent.

 

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3.4                               SNAC hereby grants AGI a limited right to reference its Covered Services as a component of the benefits marketed or promoted by AGI to Members.  In no event shall AGI market SNAC’s Covered Services separately as a standalone product to Members.  SNAC Covered Services are supplemental to the product marketed and sold by AGI and AGI understands and agrees that that it may not state through any means nor manner (directly or indirectly) that the primary Member benefit under any AGI Program is provided by SNAC, nor that AGI relies on any SNAC motor club certificate of authority, product filing, license, permit or other governmental approval granted to SNAC without SNAC’s written consent.

 

Section 4.                                          Fees.

 

4.1                               AGI shall pay SNAC for the Covered Services as such amounts as are set forth in Program Exhibit 1.

 

Section 5.                                          Marketing of AGI Programs.

 

5.1                               AGI shall provide SNAC with representative versions of online and written materials that reference SNAC and that will be used in conjunction with the marketing of AGI Programs related to this Agreement.  AGI shall not modify Approved Materials, except if such modifications or designs have been approved via the process set forth below.

 

5.2                               All online and written materials that are utilized by AGI in the promotion of AGI Programs and that reference SNAC or its affiliated companies shall be approved in writing by SNAC.  AGI shall use reasonable efforts to submit materials to SNAC at least thirty (30) calendar days prior to their intended use.  SNAC shall use reasonable efforts to return such materials with SNAC’s comments within ten (10) business days of AGI’s submission.  SNAC’s failure to respond within such period shall be deemed as approval of such materials.  AGI’s use of materials that in the promotion of AGI Programs that reference SNAC but that are not Approved Materials shall be a material breach of this Agreement allowing SNAC to terminate the Agreement unless cured in accordance with Section 8.2.  Immediately upon termination or expiration of this Agreement, AGI shall discontinue all use of Approved Materials that reference SNAC.

 

5.3                               AGI shall also provide SNAC with copies of solicitation materials that are provided to its service providers (dealerships, service centers, etc.) in conjunction with the AGI Program(s) and that reference SNAC.  In no event may AGI (a) sell Covered Services provided by SNAC to a person under the age of 18, or (b) promote Covered Services provided by SNAC in any way (directly or indirectly) with or connected to any product related to tobacco, gambling, adult content or adult themes, alcohol, weight loss, speculative investments or any gaming products or services.  AGI may promote the Covered Services only in conjunction with AGI’s products as stated in the applicable Exhibit.  Any sponsorships or endorsements that reference SNAC, including but not limited to celebrity endorsements, associated with an AGI Program are subject to SNAC’s written approval and periodic review.

 

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5.4                               SNAC will provide AGI with copies of any solicitation materials provided by AGI to consumers or Independent Service Providers by or at the direction of SNAC in conjunction with the AGI Program(s) that reference SNAC and will comply with AGI’s reasonable directions and restrictions regarding the content of such materials.

 

Section 6.                                          Marketing Restrictions, Requirements and Special Considerations.

 

6.1                               AGI shall not make any representation that it is “renting”, using, operating under, providing benefits under, or otherwise relying upon any certificate of authority to operate a motor club held by SNAC or any SNAC affiliate.

 

6.2                               Each party hereto shall be solely responsible for determining the legal and regulatory requirements applicable to it with regard to its obligations and the performance of its duties hereunder and shall not rely on the other party for advice or guidance in the determination of such legal obligations or liabilities.

 

6.3                               Each party shall be solely responsible determining the applicability of any tax obligations it accrues pursuant to this Agreement, including, without limitation, any obligations under the Canadian income tax or G.S.T. system.  Further, each party shall be solely liable for all taxes, including without limitation, income taxes and G.S.T., payable by that party under applicable law.  Neither party shall, absent a specific written agreement to the contrary, have any obligation to advance, pay or assume any tax liability of the other party.

 

6.4                               SNAC shall suppress all Member information from  outbound telemarketing, direct mail, e-mail and other marketing campaigns for motor club and/or Emergency Roadside Services conducted by, or on behalf of, SNAC, Allstate Motor Club, Allstate Enterprises, LLC and their respective subsidiaries and affiliates.  AGI shall be solely responsible for providing lists in a timely manner and for the completeness and accuracy of the information contained in such lists.

 

6.5                               Each calendar year during the Term of this Agreement, SNAC shall participate in a minimum of four (4) recreational vehicle industry trade shows designated by AGI.

 

6.6                               SNAC shall be responsible for the cost and fulfillment of AGI’s key tag program as described in Program Exhibit 1.

 

6.7                               SNAC shall develop and implement a Good Sam Smart-Phone based mobile phone application to launch approximately 90 days following the Effective Date.  Features of the application are described in Program Exhibit 1.

 

Section 7.                                          Exclusivity.

 

7.1                               Except for the AGI Programs contemplated in this Agreement, SNAC shall not create any program or enter into an agreement to provide towing and/or emergency roadside services for recreational vehicles with entities in the RV market place, including but not limited to dealerships, manufacturers or final assemblers of camping trailers, motor homes, travel trailers, truck campers or van 

 

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campers and clubs, retail parts and accessory companies, publication companies, rental companies, campgrounds and resorts, and extended warranty and insurance companies catering specifically to RV owners or enthusiasts.  Agreements that may cause SNAC to occasionally provide services to recreational vehicles as part of a program that covers medium or heavy duty vehicles other than RVs as its primary obligation shall not violate this restriction Existing SNAC partnerships and programs that provide RV services established prior to the Effective Date and that are listed on Schedule 1 attached hereto are excluded.

 

7.2                               During the Term of this Agreement, AGI shall not contract with any direct or indirect competitor of SNAC for services substantially similar to the Covered Services without SNAC’s prior written approval.

 

Section 8.                                          Member Service.

 

8.1                               SNAC will staff its SNAC Call Centers adequately to meet call volume and service levels described in Program Exhibit 1 for AGI Members.

 

8.2                               SNAC will cooperate with AGI in establishing and implementing CSR training and refresher courses and materials designed to educate CSRs on AGI Programs and procedures in compliance with the standards described in Program Exhibit 1.

 

8.3                               SNAC will use commercially reasonable efforts to maintain its network of Independent Service Providers at participation levels adequate to meet its obligations pursuant to this Agreement, but the number of Independent Service Providers and the contract terms, conditions and compensation for Independent Service Providers shall be left to SNAC’s sole and absolute discretion.

 

Section 9.                                          Operations.

 

9.1                               SNAC shall invoice AGI on or about the 15th day of each month for all Covered Services performed.  AGI shall pay any undisputed amounts set forth on such invoice at the prices described in Program Exhibit 1 within thirty (30) days of AGI’s receipt of such invoice.  If AGI reasonably disputes any charges or line items on such invoice, AGI shall inform SNAC in writing, with supporting documentation, of the specific items in dispute.  SNAC shall use reasonable efforts to investigate such disputes and provide feedback within ten (10) business days.  AGI shall not withhold payment of the undisputed amount of such invoice.  If SNAC reasonably determines that all or part of AGI’s dispute is justified, SNAC shall appropriately adjust the invoice and AGI will pay any remaining balance due.  SNAC may impose a late penalty equal to one and one half percent (1.5%) per month of any undisputed amount unpaid and owing for any invoice not paid in accordance with this Paragraph 9.1. Unresolved disputes shall be addressed by the process described in Section 19.

 

9.2                               SNAC shall supply AGI such information in the possession of SNAC as AGI may from time to time reasonably request with respect to the items for which AGI is required to reimburse or pay SNAC in connection with all Covered Services performed, including copies of supporting information relating to the costs of such Covered Services or any other costs incurred by SNAC that are required to be reimbursed by AGI in accordance with the terms hereof.  As set 

 

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forth in Section 23, AGI shall have the right from time to time, upon reasonable prior notice, to inspect such portion of SNAC’s books and records, relating directly to SNAC’s programs and services as will allow AGI to verify the correctness of the amounts that AGI is required to pay SNAC hereunder.

 

9.3                               AGI shall provide SNAC all information reasonably necessary to train CSRs to effectively operate any AGI Program no later than thirty (30) days prior to the targeted launch date of such AGI Program.  For campaigns utilizing bilingual or non-English speaking CSRs, AGI shall provide SNAC sixty (60) days written notice prior to launch and shall provide SNAC all necessary information to set-up any applicable Third Party Account and train CSRs concerning AGI Program at least forty-five (45) days prior to launch.

 

Section 10.                                   Relationship Managers.

 

10.1                        The  SNAC Relationship Manager and any assistant managers assigned by SNAC shall be the primary contact points for AGI to communicate with SNAC concerning AGI Programs and Members. AGI shall employ good faith efforts to include the  SNAC Relationship Manager in all material communications between AGI and SNAC employees related to the AGI Program. Nothing in this paragraph shall be interpreted to restrict AGI senior managers from communicating directly with SNAC senior managers. SNAC shall maintain and provide to AGI a current accurate listing of SNAC employees and Call Center Managers whom AGI may contact in the event that The Relationship Manager is unavailable or unresponsive (the “Escalation List”). After employing good faith efforts to contact the Relationship Manager and at least one other SNAC employee named in the Escalation List, if AGI believes, in good faith, that contacting the Call Center is necessary to provide timely assistance to a Member, AGI shall have direct, 24 hour a day, 7 day per week access to the Call Center managers designated in the Escalation List.

 

Section 11.                                   Reports.

 

11.1                        During the Term of this Agreement, each party will produce and transmit to the other party such reports and data as is necessary for the efficient administration of this Agreement.  SNAC shall provide the reports and summaries required by Program Exhibit 1 within the timeframes set forth thereon.  The format and data included in such reports shall be as described in the applicable Program Exhibit.

 

Section 12.                                   Termination.

 

12.1                        This Agreement will be effective as of the Effective Date written above and will continue until its expiration on March 1, 2014 (its “Initial Term”).  Unless terminated in writing by either party at least one hundred-twenty (120) days prior to the expiration of its Initial Term, this Agreement shall automatically renew for a subsequent renewal terms of one (1) year (each a “Renewal Term”, and collectively with the Initial Term, “Term”) and, unless terminated in writing by either party at least one hundred-twenty (120) days prior to the expiration of such Renewal Term, this Agreement shall automatically renew for a second (2nd) subsequent Renewal Term.

 

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12.2                        Either party may terminate this Agreement upon written notice to the other party if the other party materially breaches this Agreement and fails to cure such breach to the reasonable satisfaction of the non-breaching party within sixty (60) days after Notice of the breach, which Notice explains in reasonable detail the basis of the breach claim. Either party may terminate this Agreement in accordance with the force majeure provision set forth below.

 

12.3                        Either party may terminate this Agreement at any time immediately upon Notice if:

 

12.3.1              The other party makes any general assignment or trust mortgage for the benefit of its creditors or commits an act of bankruptcy; or

 

12.3.2              Any petition is filed by or against the other party initiating a bankruptcy, arrangement, reorganization, or other proceeding under any provision of the U.S. Bankruptcy Code or similar Canadian law; or

 

12.3.3              A receiver or trustee is appointed for the other party or for any or all of its property.

 

12.5                        AGI will be the sole owner of all toll free numbers.  AGI will be the only authorized end user to make changes to the account with the phone company in regard to the toll free numbers.  Allstate will be solely responsible for payment of invoices for all toll free usage and monthly recurring charges including applicable taxes.  Not later than 60 business days prior to the effective date of any termination of this Agreement, SNAC shall deliver to AGI all documents necessary for AGI to reassign AGI owned telephone numbers.

 

Section 13.                                   Confidentiality.

 

13.1                        “Confidential Information” shall be defined for the purposes of this Agreement as any data and information relating to the disclosing party’s business or matters relating to this Agreement which the disclosing party considers to be confidential, including, but not limited to, methods of operation, advertising materials, marketing concepts, Member or Member names and other identifying information, Member Information, and other proprietary information, whether or not such information is expressly marked as confidential and in whatever form it is disclosed.  Confidential Information does not include any information which the receiving party can demonstrate:

 

a.                                       is or becomes available to the public (other than Member Information such as name, address, telephone number, email address, and similar information that is publically available but would be difficult or costly to obtain if not delivered in connection with this Agreement) other than by a breach of this Agreement; or

 

b.                                      was previously known to the receiving party without any obligation to hold it in confidence; or

 

c.                                       was received from a third party free to disclose such information without restriction; or

 

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d.                                      is or was independently developed by the receiving party without the use of the other party’s Confidential Information and other than in connection with the performance of the receiving party’s obligations under this Agreement; or

 

e.                                       the other party has consented in writing to disclosure of such information, but only to the extent of such consent.

 

In the course of negotiation of and carrying out its obligations under this Agreement, each party may have access to or will disclose to the other of certain Confidential Information.  Each party will use the other party’s Confidential Information only for the limited purpose of and as necessary to carry out its obligations under this Agreement and will not alter, copy, misappropriate, use or misuse, transfer, sell, deliver, or divulge Confidential Information for any other purpose whatsoever.  Each party will treat the other party’s Confidential Information as the other’s trade secrets and will not disclose it to any third party without the other party’s prior written consent.  Each party acknowledges that the other party’s Confidential Information partly includes its programs, contracts, terms, procedures, marketing methods, on-line data transfer, reconciliation and reports technology.

 

13.2                        Each party will disclose Confidential Information only to those of its employees and agents whose duties require access to such information and then only for the purposes contemplated by this Agreement.

 

13.3                        The foregoing notwithstanding, either party may disclose the other party’s Confidential Information as required by applicable law or regulation or by a valid order of a court or government agency with appropriate jurisdiction over the parties and the subject matter of the information, but only to the extent of and for the purposes of such law, regulation or order and only after the other party is afforded a reasonable opportunity to oppose such disclosure or seek protection against further disclosure of the information.

 

13.4                        Each party’s Confidential Information is and will remain its sole property.  Neither party obtains any ownership or license interest in any of the other’s Confidential Information by virtue of its disclosure under this Agreement.  Each party will return to the other or destroy, at the disclosing party’s option, all of the other’s Confidential Information in its possession or control upon termination or expiration of this Agreement or at the other party’s request at any other time.

 

13.5                        The parties acknowledge that the harm caused by the wrongful disclosure of Confidential Information will be difficult, if not impossible, to assess on a monetary basis, alone, and that legal damages may not be sufficient compensation for such wrongful disclosure.  Therefore, either party may enforce its right under this Section by equitable means, including, but not limited to, injunctive relief, in addition to any other remedies to which it is otherwise entitled.

 

13.6                        The provisions of this Section will survive termination or expiration of this Agreement for three (3) years or such longer period as required by law; provided,

 

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however, that the obligation not to disclose Member Information will survive termination or expiration of this Agreement indefinitely.

 

Section 14.                                   Intellectual Property.

 

14.1                        Neither Party obtains by virtue of this Agreement rights in nor will it use any copyright, trademark, service-mark, logo, patent or other proprietary designation in which the other party or any of its parents, affiliates, or subsidiaries has any ownership or licensee interest without the other party’s prior written consent, except as otherwise expressly provided in this Agreement.

 

14.2                        Notwithstanding anything to the contrary contained herein, no trademark, service-mark or other intellectual property will be displayed without the owner’s prior express written consent which may be withdrawn with five (5) days written notice.

 

14.3                        Any and all ideas, inventions, discoveries, improvements, processes, products, software, designs, trademarks, trade secrets, reports, manuals, and any other documentation, deliverables, domain names, or work products arising from or relating to SNAC’s (including all SNAC corporate affiliates) business operations and proprietary information existing on the Effective Date and any and all SNAC business process improvements or innovations, operating methods or processes, workflow arrangements, claims processing methods, and other operational improvements, whether existing on the Effective Date or later developed by SNAC (collectively, “SNAC Intellectual Property”) shall be the sole and exclusive property of SNAC and/or its affiliates, including, without limitation, all patent, trademark and trade secret rights and all other similar intellectual property rights wherever they may be secured, free and clear of any claim or retention of rights on the part of AGI.  Any and all ideas, inventions, discoveries, improvements, processes, products, software, designs, trademarks, trade secrets, reports, manuals, and any other documentation, deliverables, or work products created jointly by the parties or by one of the parties utilizing the other party’s Confidential Information, in connection with or arising under this Agreement, the programs and projects engaged in hereunder and the Covered Services, other than SNAC Intellectual Property and the AGI Intellectual Property (as defined below) shall be the property of both SNAC and AGI and may be used separately by each of SNAC and AGI following termination of this Agreement.  Notwithstanding the foregoing, any mobile and/or “smart phone” application (and all components thereof with the sole exception of any AGI Intellectual Property) developed by SNAC under or in relation to this Agreement, the programs and projects engaged in hereunder and the Covered Services shall be deemed, as between the parties, the sole and exclusive property of SNAC, provided, however, that, following termination of this Agreement, AGI shall have the right to develop and use its own mobile and/or “smart phone” application and any such application and all components thereof shall be deemed, as between the parties, the sole and exclusive property of AGI.

 

14.4                        “AGI Intellectual Property” shall include and any and all ideas, inventions, discoveries, improvements, processes, products, software, designs, trademarks, trade secrets, copyrights, reports, manuals, and any other documentation, deliverables, domain names, derivative works, future developments, or

 

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amendments to any existing AGI intellectual property, that (i) have been developed prior to the to the Effective Date by AGI, its affiliates and agents separate and apart from SNAC (“AGI Pre-Existing Developments”), or (ii) may be developed in the future through the exclusive efforts of AGI (or, provided components of future developments through the joint efforts of AGI and SNAC are initially communicated to SNAC as proprietary, confidential or otherwise as the sole intellectual property of AGI, then with respect to those components) (“AGI Future Developments”), but excluding any business process improvements or innovations, operating methods or processes, workflow arrangements, claims processing methods, and other operational improvements developed by SNAC.  Any and all AGI Prior Developments and AGI Future Developments shall be the sole and exclusive property of AGI, including, without limitation, all patent, trademark and trade secret rights and all other similar intellectual property rights wherever they may be secured, free and clear of any claim or retention of rights on the part of SNAC.

 

14.5                        The compiled listing of third party providers comprising repair facilities, mobile mechanic facilities, mobile tech facilities, and the networks utilized for the delivery of tires and/or batteries, and any other SNAC non-Towing Network Providers compiled for the exclusive use of AGI programs (“Networks”), shall be shared between the parties and shall not be the exclusive property of either, nor shall either have any right to prevent the other from utilizing such lists in furtherance of their individual business interests, provided, however, that SNAC agrees that it shall not implement any Networks developed pursuant to this Agreement (or derivatives of such lists) to implement similar programs benefitting AGI’s direct competitor Kampgrounds of America (KOA).

 

Section 15.                                   Publicity.

 

Neither party will make any public announcement or other disclosure regarding the terms of this Agreement without the other party’s prior express written consent and approval, which, for disclosures required by law, will not be unreasonably withheld or delayed.  Both parties are strictly prohibited from disclosing in any manner the pricing, terms or conditions of this Agreement to any third party. As violation of this provision cannot be cured, a breach of this provision shall allow harmed party to immediately terminate this Agreement.  SNAC, upon request may provide AGI with a letter that AGI may disclose acknowledging the existence of a contractual relationship between the parties.

 

Section 16.                                   Representations and Warranties by AGI.

 

16.1                        AGI represents and warrants to SNAC that:

 

16.1.1              AGI has the full corporate right, power and authority to enter into this Agreement and to perform the acts required of it under this Agreement; and

 

16.1.2              AGI has adequate financial resources to fulfill its obligations under this Agreement and that it will provide SNAC prompt notice of any circumstance that could reasonably be anticipated to jeopardize its ability to meet its financial obligations under this Agreement; and

 

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16.1.3              AGI’s execution of this Agreement, along with its performance of its obligations under this Agreement, does not violate any agreement to which it is a party or by which it is bound; and

 

16.1.4              AGI’s disclosure of Member Information as contemplated in this Agreement is in all material respects compliant with its privacy policy and any federal, state, provincial and local laws and regulations governing the privacy of personal information; and

 

16.1.5              To the best of its ability, AGI will comply in all material respects with all federal, provincial, state and local laws, rules and regulations applicable to its business; and

 

16.1.6              As a point of clarification, an inadvertent violation of law or regulation by AGI which does not subject SNAC to criminal or civil liability or jeopardize any license or certificate of authority, shall not be deemed a material breach of this Agreement so long as AGI takes immediate action to bring itself in compliance with such applicable law or regulation; and

 

16.1.9              ART has all of the requisite motor club certificates of authority, licenses, permits and other governmental approvals to engage in the activities contemplated under this Agreement and shall not rely on any SNAC motor club certificate of authority or product filing for any purpose whatsoever.

 

Section 17.                                   Representations and Warranties by SNAC:

 

17.1                        SNAC represents and warrants to AGI that:

 

17.1.1              SNAC has the full corporate right, power and authority to enter into this Agreement and to perform the acts required of it under this Agreement; and

 

17.1.2              SNAC has adequate financial resources to fulfill its obligations under this Agreement and will provide AGI prompt notice of any circumstance that could reasonably be anticipated to jeopardize its ability to meet its financial obligations under this Agreement; and

 

17.1.3              SNAC’s execution of this Agreement, along with its performance of its obligations under this Agreement, does not and will not violate any agreement to which it is a party or by which it is bound; and

 

17.1.4              To the best of its ability, SNAC will comply in all material respects with all federal, provincial, state and local laws, rules and regulations applicable to its business.

 

17.1.5              As a point of clarification, an inadvertent violation of law or regulation by SNAC which does not subject AGI to criminal or civil liability or jeopardize any license or certificate of authority, shall not be deemed a material breach of this Agreement so long as SNAC takes immediate

 

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action to bring itself in compliance with such applicable law or regulation.

 

17.1.6              SNAC has all of the requisite motor club certificates of authority, licenses, permits and other governmental approvals to engage in the activities contemplated under this Agreement and shall not rely on any ART motor club certificate of authority or product filing for any purpose whatsoever.

 

Section 18.                                   Indemnity.

 

18.1                        SNAC assumes liability for and agrees to indemnify and hold AGI and each AGI Indemnitee harmless, from and against any and all Claims of every kind and nature, whether groundless or otherwise, imposed on, incurred by or asserted against AGI or such Indemnitee in any way related to or connected with or arising from or in any way connected with (i) any act or omission of SNAC, including, without limitation, its conduct in performing the services contemplated hereunder, (ii) the failure of SNAC to perform its duties pursuant to this Agreement and/or observance of all the terms, covenants and conditions contained herein, or (iii) any breach of any warranty or representation on its part made herein, alleged or real.  SNAC shall indemnify AGI and its Indemnitees for and hold AGI and its Indemnitees harmless from and against any liability for any acts or omissions of an Independent Service Provider with respect to actual services provided hereunder, when such claim is made by a Member, an AGI customer or a third party (but not by AGI itself) (“Service Provider Claims”); provided however, that SNAC’s obligation to indemnify AGI and hold AGI harmless for Service Provider Claims shall be limited to the insurance coverage maintained from time to time by SNAC and actually payable by the insurance company with respect to each such Service Provider Claim or which would have been paid had SNAC maintained the insurance required hereunder.  During the term of this Agreement, each party shall comply with the insurance requirements set forth in Section 20.1, and SNAC agrees to cause AGI to be named as an additional insured on any such insurance policy(ies) as may be maintained by SNAC for the purpose of satisfying such insurance requirements.

 

18.2.                     AGI, will indemnify, defend, and hold harmless SNAC and SNAC’s Indemnitees, from and against all Claims of every kind and nature, whether groundless or otherwise, asserted by a third party based upon any act or omission of AGI related to this Agreement, or any breach by AGI of any representation or warranty made in this Agreement, alleged or real.

 

18.3                        Each Indemnitee will provide the Indemnitor with notice stating the nature and basis of any Claim for which it intends to seek indemnification under this Section not more than five (5) business days after its receipt of notice of such Claim provided according to the requirements delineated in this Agreement, provided, however, that an Indemnitee’s failure to provide such timely notice does not foreclose the Indemnitee from its right to indemnification if the Indemnitor is not materially prejudiced by such delay.

 

18.4                        If any claim for indemnification is based upon litigation asserted against the Indemnitee, the Indemnitor may, by notice to the Indemnitee within not more

 

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than thirty (30) days after its receipt of notice of the claim for indemnification, elect to assume the defense of any such litigation with counsel reasonably acceptable to the Indemnitee.  Notwithstanding the Indemnitor’s assumption of the defense of any such litigation, the Indemnitee may participate in the litigation with counsel of its own choosing at its own expense.  If the Indemnitor elects not to or otherwise fails to assume the defense of any such litigation, the Indemnitee may proceed to defend such litigation by counsel of its choice and the Indemnitor will reimburse the Indemnitee for all reasonable attorneys’ fees and expenses for such defense.  The Indemnitor may participate in the defense of such litigation at its own expense with counsel of its choice.

 

18.5                        The Indemnitor’s election to assume or not assume the defense of any litigation under this Section will not be deemed to be a concession of any obligation to indemnify the Indemnitee for the subject matter of such litigation.

 

18.6                        Each party will provide the other with such assistance as the other reasonably requests to assist the other party in defending any third party proceeding subject to this Section.

 

18.7                        Neither party will settle an indemnified claim without the consent of the other party, which consent will not be unreasonably withheld or delayed.

 

18.8                        The Indemnitor will be fully subrogated to all rights of the Indemnitee for any claims for any amounts the Indemnitor pays under this Section.

 

18.9                        The provisions of this Section will survive termination of this Agreement.

 

Section 19.                                   Dispute Resolution.

 

19.1                        Except as otherwise expressly provided in this Agreement, the parties will submit all disputed matters between them to the following procedures:

 

19.2                        First, each party will refer each disputed matter to its respective senior executive with authority to resolve the matter on the party’s behalf.  Each such senior executive will work in good faith with the other to attempt to resolve the matter.  If such senior executives do not agree upon a resolution to the matter with ten (10) business days after referral of the matter to them, either party may submit the matter to mediation as described below.

 

19.3                        Either party may, upon notice to the other party and within ten (10) business days after the conclusion of the negotiations between senior executives described above, elect to have the disputed matter referred to non-binding mediation before a single impartial mediator to which the parties agree.  The mediation hearing will be attended by an executive of each party with authority to resolve the matter and will be conducted no more than thirty (30) days after the mediation notice.  The parties will share the expenses of the mediation equally.

 

19.4                        If and only if the parties are unable to resolve the disputed matter through the procedures described above, either party may pursue any other means to resolve the matter to which it is otherwise entitled under law.

 

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Section 20.                                   Insurance.

 

20.1.                     Each party will maintain and provide proof to the other, upon request, of such insurance policies or programs of self-insurance as are reasonable to insure itself and the other party from any and all reasonably foreseeable claims resulting from any action taken or failure to act by its employees, agents or independent contractors pursuant to this Agreement and from the provisions of its services and operation of its business, including the following types and minimum limits:

 

Worker’s Compensation insurance in minimum limits required by law in the applicable jurisdictions covering all of the party’s employees engaged in the performance of any obligations hereunder;

 

Commercial liability, errors & omissions and crime insurance with the following combined single limits:

 

1) AGI: not less than $2,000,000 per occurrence; and

 

2) SNAC: not less than $5,000,000 per occurrence.

 

20.2            SNAC will require and maintain documentary support that all Independent Service Providers maintain the following types of insurance and limits:

 

Worker’s Compensation insurance as required by any applicable law;

 

Comprehensive General and Automobile Liability insurance with minimum limits of $100,000 each person and $300,000 each occurrence for bodily injury and $100,000 each occurrence for property damage or a minimum combined single limit for bodily injury and property damage of $300,000 per occurrence;

 

Garage Keepers’ Legal Liability or Garage Keeper’s Liability insurance (including, “On-Hook” Liability insurance) with a minimum limit of $25,000).

 

Section 21.                                   Limitation of Damages.

 

Except for obligations to third parties for such damages under the indemnification obligations contained in Section 18, above, neither party nor any of its affiliates will be liable to the other for any indirect, special, incidental or consequential damages, including, but not limited to, lost profits, arising out of or related to this Agreement or its performance or breach, even if it is advised of the possibility of any such damages.  AGI acknowledges that Emergency Roadside Assistance is provided by Independent Service Providers who are not under the direction and control of SNAC.

 

Section 22.                                   Force Majeure.

 

To the extent permitted by law, in the event that either party fails in whole or in part to fulfill its obligations under this Agreement as a consequence of an act of God, fire, explosion, strike, flood, earthquake, embargo, war, riot, or any other cause reasonably beyond the control of the disabled party, such failure to perform will not be considered a breach of this Agreement during the period of such disability and for a reasonable time thereafter; provided, however, that if such period continues in excess of sixty (60) days, the non-disabled party may terminate this Agreement upon thirty (30) days prior written

 

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notice.  In the event of any force majeure occurrence, as set forth in this Section, the disabled party will use its best efforts to meet its obligations under this Agreement.  The disabled party will promptly and in writing advise the other party if it is unable to perform due to a force majeure event, the expected duration of such inability to perform, and any developments that appear likely to affect its ability to perform any of its obligations, in whole or in part.

 

Section 23.                                   Books and Records.

 

Each party will maintain books and records of all activities relevant to this Agreement according to standard business practices sufficient to demonstrate its faithful performance of its obligations.  Each party will provide the other with access to such books and records during normal business hours at the reviewing party’s expense and with not less than fourteen (14) business days prior written notice for purposes of auditing the reviewed party’s performance under this Agreement, including, but not limited to, compliance with its provisions regarding protection of Confidential Information.  Each party will preserve all such books and records for a period of not less than two (2) years (not less than two years from the date of Disablement for call recordings) after the expiration or termination of this Agreement, but, in no event, less than any longer period required by law.  AGI shall have the right, from time to time, upon reasonable prior notice, to inspect such portion of SNAC’s books and records relating directly to AGI’s Programs.

 

Section 24.                                   Relationship of the Parties.

 

The relationship between SNAC and AGI established pursuant to this Agreement is that of independent contractors and neither party will be construed to be the agent or employee of the other.  Except as expressly provided in this Agreement, neither party may bind or obligate the other in any manner without the prior written consent of the other.

 

Section 25.                                   Third Party Beneficiaries.

 

This Agreement has been made for the sole benefit of the named parties and shall not be construed to confer any benefit or rights upon nor may it be enforced by any other person, including, but not limited to, any officer, director, employee, stockholder, creditor or customer of either party; provided, however, that the foregoing third-party beneficiary disclaimer shall not restrict third parties from seeking indemnification from the named parties to the Agreement.

 

Section 26.                                   Governing Law.

 

This Agreement will be governed in all respects by and construed according to the laws of the United States and the State of Delaware without regard to its rules on conflict of laws.  The exclusive venue for any litigation related to or arising from this Agreement shall be in a state or federal court of competent jurisdiction located in Delaware and AGI specifically waives any objection to such jurisdiction and/or forum, whether based on inconvenience or otherwise.

 

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Section 27.                                   Entire Agreement.

 

This Agreement, including the Program Exhibits, contains the entire agreement of the parties and supersedes any and all previous agreements, whether oral or written, between them with respect to its subject matter.

 

Section 28.                                   Amendment.

 

This Agreement may not be modified in any manner except in a written instrument executed by both parties which specifically refers to this Agreement and expressly recites the purpose of the modification.

 

Section 29.                                   Assignment.

 

This agreement may not be assigned or transferred by either party without the other’s prior written consent, which consent may not be unreasonably withheld, conditioned or delayed.  Notwithstanding the foregoing, (a) AGI and ART shall have the right to assign this Agreement to any entity with which either of them may merge or consolidate or which acquires substantially all of the assets of AGI and ART; and (b) SNAC may assign this Agreement or delegate the performance of its duties hereunder to one or more corporate affiliates that are wholly owned subsidiaries of The Allstate Corporation or Allstate Enterprises, LLC,  provided that any such affiliate agrees in writing to be bound by the confidentially provisions contained herein, but such delegation will not relieve SNAC of its responsibilities under this Agreement.

 

Section 30.                                   Waiver.

 

No failure or delay by either party to exercise and no course of dealing with respect to any right of such party regarding an obligation of the other party will operate as a waiver of any such right unless the waiving party so designates in writing.  Any single or partial exercise by either party of any of its rights will not preclude such party from any other exercise of any such right or the exercise of any other right.  Any single or partial waiver by either party of any obligation of the other party under this Agreement will constitute a waiver of such obligation only as specified in such waiver and will not constitute a waiver of any other obligation.

 

Section 31.                                   Severability.

 

With the exception of Section 4, if any provision of this Agreement is held to be invalid or unenforceable for any reason, the parties will reform that provision to the extent necessary to enforce it and preserve the parties’ original intent, failing which, it will be severed from this Agreement with the balance of this Agreement continuing in full force and effect.

 

Section 32.                                   Notices.

 

All notices, requests and approvals required by this Agreement will be in writing addressed to the President of each party at the address stated for each on the first page of this Agreement with a duplicate copy addressed to the attention of each party’s General Counsel at the same address, or to such other address as either party designates to the other by notice.  All notices will be deemed to have been given either when personally delivered or upon delivery by either registered or certified mail, postage prepaid with return receipt requested, or by a recognized overnight delivery service.

 

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Section 33.                                   Headings.

 

The section headings in this Agreement have been inserted as a matter of convenience in reference, only, and are not intended nor should they be construed to convey any substantive content in interpretation of this Agreement.

 

Section 34.                                   Recitals.

 

The recitals are intended and should be construed to be a part of this Agreement for all intents and purposes.

 

Section 35.                                   Exhibits.

 

All exhibits attached to this Agreement, including, but not limited to, Program Exhibit 1, are incorporated into this Agreement by their reference.  In the event that any provision of an Exhibit or other attachment to this Agreement conflicts with any provision in the main body of this Agreement, the provisions contained in the Exhibit will prevail.

 

Section 36.                                   Counterparts.

 

This Agreement may be executed in any number of counterparts, each of which is to be deemed an original and all of which together constitute one and the same instrument.

 

The parties have executed this Agreement by their duly authorized representatives on the dates reflected below to be effective as of the day and year first written above.

 

Signature’s Nationwide Motor Club, Inc.

 

	
By:
    	
/s/   Anthony Royer
    	
 
    	
 
    
	
 
    	
Signature
    	
 
    	
 
    
	
Anthony Royer
    	
 
    	
 
    
	
 
    	
Printed   Name
    	
 
    	
 
    
	
Title:
    	
President
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Affinity Group, Inc.
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/   Prabhuling Patel
    	
 
    	
 
    
	
 
    	
Signature
    	
 
    	
 
    
	
Prabhuling Patel
    	
 
    	
 
    
	
 
    	
Printed   Name
    	
 
    	
 
    
	
Title:
    	
Chief   Marketing Officer
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Affinity Road and Travel   Club, Inc.
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/   Mark Kupper
    	
 
    	
 
    
	
 
    	
Signature
    	
 
    	
 
    
	
 
    	
Mark   Kupper
    	
 
    	
 
    
	
 
    	
Printed   Name
    	
 
    	
 
    
	
Title:
    	
Executive   Vice President
    	
 
    	
 
    

 

20Exhibit 10.8

 

FREEDOMREWARDS 401(k) PLAN SUMMARY PLAN DESCRIPTION

 

February 1, 2010

 

 

FREEDOMREWARDS 401(k) PLAN

 

SUMMARY PLAN DESCRIPTION

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
I.
    	
INTRODUCTION   
    	
1
    
	
 
    	
 
    	
 
    
	
II.
    	
BECOMING   A PARTICIPANT 
    	
2
    
	
 
    	
 
    	
 
    
	
III.
    	
CONTRIBUTIONS   AND ACCOUNTS
    	
3
    
	
 
    	
 
    	
 
    
	
IV.
    	
VESTING   AND FORFEITURE
    	
6
    
	
 
    	
 
    	
 
    
	
V.
    	
THE   TRUST
    	
9
    
	
 
    	
 
    	
 
    
	
VI.
    	
HARDSHIP   WITHDRAWALS, IN-SERVICE DISTRIBUTIONS AND LOANS
    	
11
    
	
 
    	
 
    	
 
    
	
VII.
    	
DISTRIBUTION   AND METHODS OF PAYMENT OF BENEFITS
    	
13
    
	
 
    	
 
    	
 
    
	
VIII.
    	
OTHER   THINGS YOU SHOULD KNOW
    	
16
    

 

 

SUMMARY PLAN DESCRIPTION

 

FREEDOMREWARDS 401(k) PLAN

 

FreedomRoads, LLC

250 Parkway Drive, Suite 270

Lincolnshire, IL 60069

 

(847) 808-3000

 

	
Employer   Plan No. 001
    	
Employer   Federal I.D. No. 87-0689007
    

 

Trustee: Investors Bank & Trust Company

200 Clarendon Street

Boston, MA 02116

 

Committee:                                     Karin Bell, Ken Marshall, Roger Nuttall, Mary Ellen Spedale, Dan Varela and Tamara Ward.

 

The Company is the Plan Administrator.  The Committee acts as agent for the Plan Administrator.

 

The agent for service of legal process is the Company. Service of legal process may be made upon the Company at the above address.

 

I. INTRODUCTION

 

The FREEDOMREWARDS 401(k) PLAN (the “Plan”) is a 401(k) Plan designed to provide Eligible Employees of FREEDOMROADS, LLC (the “Company”) and the Participating Companies listed on the Addendum A to this Summary with benefits upon retirement, disability, death or termination of employment.

 

This Summary Plan Description (the “Summary”) describes the highlights of the Plan as of January 1, 2010, including when you can participate in the Plan and when you may expect to receive benefits. If you have questions after reading this Summary, please feel free to contact a member of the Committee during regular business hours.

 

IN THE CASE OF ANY CONFLICT BETWEEN THIS SUMMARY AND THE PLAN DOCUMENTS, THE TERMS OF THE PLAN DOCUMENTS WILL CONTROL.

 

 

II.                                     BECOMING A PARTICIPANT

 

If you are not already a Participant, you will become a Participant in the Plan on your Entry Date.

 

“Entry Date” means the day you become an Eligible Employee.

 

A “Plan Year” is the 12 consecutive month period ending on December 31.

 

For purposes of 401(k) Contributions, you become an “Eligible Employee” when you have attained the age of 18. There is no service requirement.

 

For purposes of sharing in Profit Sharing and Matching Contributions, you will become an Eligible Employee when you have completed one (1) Year of Service and the attainment of age 18.

 

However, you will not become an Eligible Employee if you are a member of one of the following classes of employees:

 

·                                          Your Compensation and conditions of employment are established under a collective bargaining (union) agreement.

 

·                                          You are a non-resident alien who receives no earned income from services rendered within the United States.

 

·                                          You are not reported on the Company payroll records because you are considered an independent contractor by the Company.

 

Waivers of Participation shall not be permitted.

 

For purposes of Eligibility, a “Year of Service” is a consecutive 12-month period in which you work at least one (1) Hour of Service during such consecutive 12-month period. For purposes of becoming a Participant in the Plan, your first consecutive 12month period begins on your date of hire, and all later consecutive 12-month periods begin on the anniversary of your date of hire. For purposes of Eligibility, a Year of Service with any of the Predecessor Employers listed on Addendum A to this Summary will be considered a Year of Service with the Company.

 

An “Hour of Service” is:

 

A. For eligibility and vesting, each hour for which you are paid for the performance of duties and are entitled to receive Compensation;

B. Each hour (but not more than 501 hours) in any Plan Year in which you are paid by the Company for non-performance of duties, including vacations, temporary layoff, approved leave of absence, sickness, disability, jury duty or military duty; and

 

 

C. Each hour for which back pay has been awarded or agreed to by the Company.

 

If you leave the Company and return and you were a Participant, you will be a Participant on the first day of your re-employment.

 

III. CONTRIBUTIONS AND ACCOUNTS

 

The amount of contribution you will be entitled to is based on a formula in the Plan and the amount of Compensation you receive. Contributions made by and for you under the Plan and their earnings will be held in one or more bookkeeping “Accounts” as described below.

 

Your compensation for Plan purposes includes your income or salary as reflected on your pay stub. In addition, your compensation may also reflect the cash value of fringe benefits provided to you by your Employer. Compensation includes your salary deferrals made to the Company’s 401(k) plan or cafeteria plan, if applicable.

 

Compensation shall also include the following types of payments you may receive after you terminate employment with the Company:

 

· Pay for regular services performed.  These are payments you would have received had you continued employment with the Company.  This may include commissions, bonuses or similar type payments.

· Pay for any unused accrued bona fide vacation, sick or other leave.

 

These post-severance payments will be included if they are received by the later of 21⁄2 months after your severance or by the end of Plan Year during which your severance occurs.

 

401(k) Contributions will be deducted from any post-severance payments which are included in Compensation.

 

Compensation will not include post-severance payments received solely as a result of your termination of employment or any payments from the Company’s nonqualified deferred compensation plan, if any.

 

Compensation is limited to $245,000 for the Plan Year beginning in the year 2010 which limit is subject to cost of living increases by the Internal Revenue Service.

 

Compensation paid prior to a Participant’s Entry Date is excluded.

 

 

401(k) CONTRIBUTIONS

 

Once you are a Participant in the Plan, you may elect to save up to 75% of your Compensation. If you are a Highly Compensated Employee, the amount you choose to save will be limited to 15% of your Compensation. The amount you elect to save will be contributed to the Plan on your behalf. These are your “401(k) Contributions”.

 

For the Plan Year beginning in 2010, a “Highly Compensated Employee” (HCE) is any Employee who earns more than $110,000 during the 2009 Plan Year.  A Non-Highly Compensated Employee is any Employee who is not a Highly Compensated Employee. After 2010, the dollar limit may increase each year so you should check with the Committee at the beginning of each Plan Year to find out the new dollar limit.

 

Beginning January 1, 2010, the amount you may choose to save is limited to $16,500 or 75% (15% for HCEs) of your Compensation, whichever is smaller. After 2010, the limit may change each year so you should check with the Committee each January to find out the new limit. You are not required to save.

 

In addition to the 401(k) Contributions you choose to save each year, if you are or will be age 50 before the end of the calendar year (December 31), you can save additional amounts called “Catch Up Contributions”.  These contributions are not subject to the 75% (or 15%) of your Compensation limitation stated above. Your Catch Up Contribution limit for 2010 is $5,500.  After 2010, the limit may change each year so you should check with the Committee each January to find out the new limit.

 

The Committee will give you an election form to fill out. The form will allow you to elect the amount you want to save. Your 401(k) Contributions will be made by withholding from your paycheck. You can change the amount you save at any time by giving advance written notice to the Committee. You may suspend your 401(k) Contributions at any time by giving advance written notice to the Committee. If you suspend your 401(k) Contributions, you may defer again at any time.

 

If you do not complete and file an election form with the Committee regarding your election to make or not to make 401(k) Contributions, you shall have automatic 401(k) Contributions withheld from your Compensation in the amount of 3% of your Compensation.

 

You may change or suspend automatic 401(k) Contributions at any time by filing a new election form with the Committee.

 

If automatic 401(k) Contributions are withheld from your paycheck, the contributions shall be deemed pre-tax 401(k) Contributions.

 

 

Your 401(k) Contributions and Catch-Up Contributions withheld from your paycheck and contributed to the Plan are not subject to Federal income tax until a later time when you actually receive your retirement benefits. Your 401(k) Contributions and Catch-Up Contributions are set aside into a bookkeeping account for you. This account is called a “401(k) Contribution Account.”

 

ROTH CONTRIBUTIONS

 

You may designate all or part of your 401(k) Contributions as Roth Contributions at the time you make your election to save (see above).  Roth Contributions are like 401(k) Contributions because they are withheld from your paycheck but are treated as after-tax contributions for income tax purposes.  However, Roth Contributions and earnings on Roth Contributions are generally tax free when you withdraw them from the Plan, provided the following conditions are met:

 

1.               Your first Roth contribution was made at least five taxable years ago, and

2.               The distribution is being made upon your attainment of age 591⁄2, death, or disability.

 

The overall dollar limit of $16,500 and catch-up limit of $5,500 for 2010 include any designated Roth Contributions. You may change your designated Roth Contributions at the same time that you can change your 401(k) Contributions.  Your 401(k) Contributions that are designated as Roth Contributions are accounted for separately and are referred to as your “Roth Contribution Account.”

 

MATCHING CONTRIBUTIONS

 

Matching Contributions are discretionary.  This means that the Company has the sole right to make (or not to make) a Matching Contribution in any Plan Year.

 

If made, Matching Contributions for each Plan Year shall be allocated to the Matching Contribution Accounts in the proportion that each Participant’s 401(k) Contribution made during the Plan Year bears to all Participants’ 401(k) Contributions made during the Plan Year; provided, however the maximum 401(k) Contributions that will be matched shall be limited to 6% of Compensation.

 

Catch-Up Contributions are eligible to be matched.

 

401(k) Contributions that are designated as Roth Contributions are eligible to be matched.

 

These contributions are called “Matching Contributions”. Your Matching Contributions are set aside into a bookkeeping account for you. This account is called a “Matching Contribution Account”.

 

 

PROFIT SHARING CONTRIBUTIONS

 

The amount of the Profit Sharing Contribution is determined by the Company. This contribution shall be based on a discretionary percentage of your Compensation determined by the Company.

 

These contributions are called “Profit Sharing Contributions”. Your Profit Sharing Contributions are set aside into a bookkeeping account for you. This account is called a “Profit Sharing Contribution Account”.

 

Allocation Requirements

 

You will be eligible to receive an allocation of Profit Sharing Contributions and Matching Contributions in any Plan Year that the Company makes such contributions and you are working for the Company on the last day of the Plan Year.

 

If you are on qualified military service leave you may be entitled to additional Company contributions upon your return to work and be allowed to make up 401(k) Contributions that you missed while you were on qualified military service leave.

 

Rollover Contributions.

 

During any Plan Year, you may, in certain cases, make “Rollover Contributions” to the Plan.  This means that, in certain cases, if you were a participant under another pension or profit-sharing plan or a tax-sheltered annuity (Section 403(b) plan) or governmental (Section 457) plan and you receive a single-sum distribution from that plan, then you may transfer the distribution to the Plan and not be currently taxed on the distribution. You may also rollover contributions from your Individual Retirement Account (IRA), but only an IRA which would be taxable to you if paid to you.  In other words, any IRA other than a Roth IRA or an IRA to which you made non-deductible contributions may be rolled over into this plan. This Plan will accept a direct rollover of Roth Contributions from another Roth 401(k) plan. The Plan does not accept employee after tax contributions. The Account that holds your rollover contributions and its earnings is your “Rollover Contribution Account”.

 

IV. VESTING AND FORFEITURE

 

You can only forfeit that part of an Account that is not vested. You are always fully (100%) vested in any balance in your 401(k) Contribution, Rollover Contribution and Roth Contribution Accounts.

 

 

You will vest in your Profit Sharing Contribution and Matching Contribution Accounts as follows:

 

Years of Vested

Vesting Service Percentage

less than 2 0%

2 20%

3 40%

4 60%

5 80%

6 or more 100%

 

If you are a former Participant of the Blaine Jensen & Sons, Inc. 401(k) Plan, you will be fully vested in your Matching Contributions and Profit Sharing Contributions from that Plan. Please note that this only applies to those contributions made to your Accounts from the Blaine Jensen & Sons, Inc. 401(k) Plan.

 

If you are a former Participant of Dusty’s Camper World of Bartow, Inc. 401(k) and Profit Sharing Plan, you will be fully vested in your Safe Harbor Matching Contributions from that Plan.

 

All Years of Service that you complete while working for the Company will be counted for purposes of computing your vested percentage of the value of your Accounts.

 

For vesting purposes, a “Year of Service” is working for the Company over a period of twelve (12) consecutive months beginning on your date of hire and any subsequent twelve (12) consecutive month period commencing on any anniversary date of your date of hire regardless of whether you are a Participant.

 

For purposes of Vesting, a Year of Service with the Predecessor Employers listed on the Addendum A to this Summary will be considered a Year of Service with the Company.

 

You may also be given credit for Years of Service while you were on qualified military leave if you return to work after a period of qualified military service.

 

Forfeitures may be used to pay administrative expenses of the Plan and then used to reduce Matching Contributions and Profit Sharing Contributions.

 

If you leave the Company after you reach Normal Retirement Age, you become Totally Disabled, or you die while employed by the Company, you will fully vest in your Accounts.

 

 

Your “Normal Retirement Age” is your 591⁄2 birthday.

 

You are “Totally Disabled” if you are unable to work at any substantial gainful activity because of a physical or mental condition, illness or disease which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than twelve (12) months, as determined by a licensed physician selected or approved by the Committee.

 

If you leave the Company prior to full vesting and receive payment of the vested portion of your Profit Sharing Contribution Account and Matching Contribution Account, and you return before you incur five (5) consecutive one-year Breaks-in-Service, then you can repay the distributed portion within five (5) years of the date of your reemployment. If you timely repay the amount you previously received, your previously forfeited benefit will be restored to your Profit Sharing Contribution Account and Matching Contribution Account subject to future vesting.

 

If you leave the Company prior to full vesting and do not receive payment of the vested portion of your Profit Sharing Contribution Account and Matching Contribution Account, and you return before you incur five (5) consecutive one-year Breaks-in-Service, then you will be credited with Years of Service earned after you return to the Company when determining the vested interest in your Profit Sharing Contribution Account and Matching Contribution Account earned prior to that period. Once you have five (5) consecutive one-year Breaks-in-Service, you will forfeit the non-vested portion of your Profit Sharing Contribution Account and Matching Contribution Account.

 

If you leave the Company prior to any vesting in your Profit Sharing Contribution Account and Matching Contribution Account and you return before you incur five (5) consecutive one-year Breaks-in-Service, then your previously forfeited benefit will be restored to your Profit Sharing Contribution Account and Matching Contribution Account subject to future vesting. Years of Service that you completed prior to your Break-in-Service will be counted in determining your vested Profit Sharing Contribution Account and Matching Contribution Account earned prior to the Break-in-Service only if you do not incur five (5) consecutive one-year Breaks-in-Service.

 

If you leave the Company and have five (5) consecutive one-year Breaks-in-Service, Years of Service that you complete after the Break-in-Service are not counted for purposes of determining the vested percentage of the value of your Profit Sharing Contribution Account and Matching Contribution Account as it existed before your Break-in-Service. However, if you are partially vested when you leave the Company, Years of Service that you complete both before and after the Breaks-in-Service are counted to determine your vested percentage in your Profit Sharing Contribution Account and Matching Contribution Account that you earn in Plan Years after the five-year Break-in-Service.

 

 

For purposes of Vesting, a Break-in-Service is when you do not work at least one (1) Hour of Service during any 12 consecutive month period beginning on any anniversary of your date of hire.

 

If you are granted a “maternity or paternity” leave of absence, you will be given service credit during the leave but this is only for purposes of avoiding a Break-in-Service. Maternity or paternity leave of absence means absence from work (1) because you are expecting the birth of a child; (2) because of the birth of a child; (3) because of the adoption of a child; or (4) to care for your child after birth or adoption. The crediting of service during a maternity or paternity leave of absence can prevent you from having a Break-in-Service during the Plan Year in which you begin a leave of absence or the following Plan Year while you are on a leave of absence. No service will be credited unless you give the Committee information before you begin your leave that your absence is “a maternity or paternity leave of absence” and the number of days you plan to be absent.

 

If you are on qualified military service leave you will not incur a Break-in-Service.

 

V. THE TRUST

 

All contributions are placed into a Trust to be held by the Trustee. The contributions and your Accounts are invested by the Trustee as directed by you.  You may obtain the value of your Accounts on a daily basis.

 

You direct how the Trustee is to invest the assets in all of your Accounts. For this reason, the Plan intends to comply with Section 404(c) of ERISA. This means that Plan fiduciaries may be relieved of liability for any losses that are the direct and necessary result of investment instructions given by you, your investment manager or your beneficiary.

 

The Plan offers a broad range of diversified investment options with different risk and return characteristics. These investment options permit you to invest your Accounts in a way that meets your own individual objectives. You choose the investment option that best meets your retirement goals. If the investment option has voting rights, these rights will not be passed through for you to exercise them.

 

You may choose to make your own investment choices from the various investment options or mutual funds made available to you by the Committee.

 

A description of the type and diversification of assets, investment objectives, and risk and return characteristics of individual investments is in the mutual fund prospectuses, annual reports, investment highlights and performance summaries of each mutual fund which will be distributed to you.

 

 

You will receive a copy of the most recent prospectus for each mutual fund in which you actually make an investment. A copy will be provided to you either before or immediately following your initial investment in a mutual fund.

 

You may change how new amounts contributed to your Accounts are invested, and how amounts previously credited to your Accounts are invested, as often as allowed by the Plan’s investment service provider.  You may choose or change investment options by calling the investment service provider by telephone via their 800 number. The Committee will give you information about the investment service provider and their trading policies when you become a Participant.

 

If investment in an available mutual fund is subject to transaction fees (e.g. a check charge, a market value adjustment, or a commission, deferred sales charge, redemption, transfer or exchange fee) associated with the purchase, sale or transfer of your interest in the available plan investments, you will receive that information before you invest.

 

At your request, you will be provided:

 

(i) A description of the annual operating expenses of each investment alternative made available to you (e.g., investment management fees or administrative fees) that reduce the rate of return you receive, and the aggregate amount of these expenses, expressed as a percentage of the average net assets in the investment alternative.

 

(ii) Copies of any materials relating to the available investments, to the extent such materials are provided to the plan (e.g., prospectuses and financial reports).

 

(iii) Information on the value of shares or units of a mutual fund, as well as past and current investment performance of each mutual fund.

 

(iv) Information on the value of the shares or units held in your Accounts.

 

(v) Written confirmation of your investment changes including transfers between funds and changes in the investment of your future contributions.

 

To receive any of the above information, please contact: FreedomRoads, LLC 2 Marriott Drive Lincolnshire, IL 60069-3700 or by telephone at (847) 808-3000

 

 

You are responsible for your own individual investment decisions. Gains and losses to your Accounts come from your investment decisions. Neither the Company, nor the Trustee, nor members of the Administrative Committee are liable if your Accounts suffer a loss as a result of your investment decisions.

 

The investment service provider will give you more information about the investment options available to you.

 

VI. HARDSHIP WITHDRAWALS, IN-SERVICE DISTRIBUTIONS AND LOANS.

 

Hardship Withdrawals

 

You will be entitled to Hardship withdrawals of 401(k) Contributions including Roth Contributions, and Profit Sharing Contributions and Matching Contributions to the extent vested. An “event of hardship” means:

 

·                                          Payment of medical expenses described in Section 213(d) of the Internal Revenue Code of 1986, as amended, which are incurred by you, your spouse, your primary beneficiary, or any of your dependents as defined in Section 152(d) of the Code or necessary for these persons to obtain medical care as described in Section 213(d) of the Code.

 

·                                          Purchase of a principal residence, but not including mortgage payments, by the Employee.

 

·                                          Payment of tuition, room and board, and related educational fees for the next 12 months of post-secondary education for you, your Spouse, children, your primary beneficiary, or dependents.

 

·                                          The need to prevent eviction of the Employee from his or her principal residence or foreclosure on the mortgage of the Employee’s principal residence.

 

·                                          Payment for burial or funeral expenses for your parent, Spouse, children, your primary beneficiary, or dependents.

 

·                                          Payment of expenses for the repair of damage to your principal residence that would qualify for casualty deduction under Section 165 of the Code without regard whether the casualty exceeds 10% of your adjusted gross income.

 

An immediate financial need for one of the reasons stated above includes, in addition, any amount necessary to pay federal, state or local income tax or penalties reasonably anticipated to result from the hardship withdrawal.

 

 

If you receive a hardship distribution of your 401(k) contributions, you will not be allowed to make 401(k) contributions for at least 6 months under this Plan, and if applicable, the Company’s Cafeteria Plan other than deferrals used to provide for health benefits.

 

In-Service Distributions other than Hardship

 

You may request payment of your Accounts at age 591⁄2 or later.

 

However, you may request payment of your Rollover Contribution Account at any time.

 

Loans To Participants

 

You may borrow from the Plan. The Committee will administer the loan program under the Plan using the following guidelines:

 

1. Any Participant who wishes to apply for a loan should apply in writing to the Committee. The repayment period cannot be longer than 5 years unless the loan proceeds will be used to purchase a principal residence.

 

2. The maximum loan amount cannot be more than one-half of your vested benefit or $50,000, whichever is less.

 

3. In deciding whether to approve or deny any loan application, the Committee will review the amount requested, your creditworthiness, and your vested benefit in the Plan.

 

4. The interest rate on the loan will be determined by the Prime Rate plus one percent (1%).

 

5. If you fail to repay the loan timely and your vested interest is distributable, the Committee shall treat the amount in arrears plus accrued interest as a distribution. The Committee will report the deemed distribution to the Internal Revenue Service.

 

6. If you are on qualified military leave, loan repayments shall be suspended during the times you are on military leave.

 

7. Loans will only be made to those Participants who are still employed in the Company.

 

·                  The minimum loan amount should be $1,000.

·                  All loans shall be repaid by payroll deductions.

·                  Loans are a direct investment of a Participant’s account.

 

 

Note: Other rules regarding loans are covered in the loan documentation, which is available from the Plan Administrator.

 

YOU HAVE A DUTY TO KEEP THE COMMITTEE AND THE PERSONNEL OFFICE INFORMED OF YOUR CURRENT HOME ADDRESS (OR THAT OF A CLOSE RELATIVE) SO THAT BENEFITS CAN BE PAID TO YOU WHEN DUE.

 

VII. DISTRIBUTION AND METHODS OF PAYMENT OF BENEFITS.

 

You will be entitled to the vested value of your Accounts when you leave the Company for any reason including Total Disability or death. If you leave the Company before becoming fully vested in the value of your Profit Sharing Contribution Account and Matching Contribution Account, you will be entitled to the vested part of your Accounts determined by your Years of Service.

 

If you leave the Company before Normal Retirement Age (defined in Article IV), the payment of your benefits at the time you leave will be made as soon as administratively feasible after your employment termination date.

 

If your vested benefits are equal to or less than $1,000 and you do not directly transfer your benefit to an IRA or another Plan, your benefit will be distributed in a single-sum payment, after the thirty (30) day waiting period stated below has expired but before one hundred and eighty (180) days from the date the Committee provided you with notice to receive benefits described below.  The single-sum payment will be subject to twenty percent (20%) federal income tax withholding.  To directly transfer your Roth Contribution Account to another plan or Roth IRA, your Roth Contribution Account must total at least $200 unless your total vested benefit exceeds $1,000.

 

If you have elected to receive a distribution from the Plan and your vested benefits are between $1,001 including any Rollover Contributions, and $5,000, you may elect to either directly transfer your benefits to an IRA or another plan or receive your vested benefits. For purposes of determining if your vested benefit is greater than $5,000, Rollover Contributions are excluded. If you do not make this election, the Committee will directly transfer your vested benefits to an IRA established for your benefit.

 

The Committee has entered into a contract with Diversified Investment Advisors which is the IRA Provider.  Any fees charged by the IRA Provider for establishing or maintaining the IRA will be charged directly to your vested benefits.

 

 

Your IRA funds will be invested in an investment product that is designed to preserve principal and provide for a reasonable rate of return and liquidity (for example, a brokerage savings account or a money market fund). This investment product is designed to preserve principal and provide for a reasonable rate of return and liquidity.

 

For information concerning the Plan’s automatic rollover process, the IRA Provider and the fees and expenses that may be charged to the IRA, please contact:

 

Dan Varela, by mail at: FreedomRoads, LLC 2 Marriott Drive Lincolnshire, IL 60069-3700

 

or by telephone at (847) 808-3000

 

If your vested benefit is greater than $5,000 when you leave the Company, you may consent to a distribution as permitted by the plan in any of the alternative methods outlined below.  If you do not consent to a distribution, your benefits will be deferred to the earlier of your Normal Retirement Age or Age 62 if later or until you consent to an immediate distribution.  Unless you elect to transfer your benefit directly to an IRA or another plan, your distribution, generally, will be reduced by federal income tax withholding as described above.

 

The Plan will exclude your Rollover Contribution Accounts when calculating the $5,000 amount.

 

The Committee will provide you with a notice of your right to defer benefits to Normal Retirement Age or Age 62 if later no less than thirty (30) days and no more than one hundred and eighty (180) days prior to the proposed payment date. After you receive the notice, you can make a written consent to a distribution. Distribution of your benefits can be made no sooner than thirty (30) days following your receipt of the notice unless you waive the thirty (30) day waiting period and no later than one hundred and eighty (180) days following your receipt of the notice.

 

Alternate Forms of Payment

 

Your alternate choices of payment are as follows:

 

Single Sum. The payment of all or a portion of your vested Accounts in a single sum in cash.

 

 

Direct Transfer. You may also choose a direct or partial direct transfer to an individual retirement account (IRA), an individual retirement annuity, an annuity plan, a tax-sheltered annuity (section 403(b) plan) or governmental (section 457) plan or another qualified plan that accepts transfers.  If you choose a partial direct transfer your vested Accounts must total more than $500.

 

You may also choose to directly roll over your Account(s) to a Roth IRA.  Please note that if you choose to roll over to a Roth IRA, the taxable portion of your Account(s) will be taxed at the time of your rollover.

 

Installments. The payment of your vested Accounts in a series of installments payable monthly, quarterly, semi-annually or annually.  A Participant shall not be entitled to change the amount of installment payments.

 

Death Benefits and Spousal Rights

 

If you are married when you die, your death benefits will automatically be paid to your Spouse in any one of the alternative methods listed above, unless you and your Spouse specifically give up the right to have survivor benefits paid to your Spouse.

 

The Committee will give to you forms on which you may select the Beneficiary you want to receive your death benefits.  You may change your Beneficiary selection at any time before your death. If for some reason you have not properly selected your Beneficiary, then your benefits will be paid in the following order of preference:  to your Spouse; to your living trust; to your children; to your estate.

 

You can select a Beneficiary other than your Spouse by signing a Waiver Election as discussed below.

 

However, if you select a Beneficiary other than your Spouse, your Spouse must consent to the Waiver Election and state that your selection of another Beneficiary will cause him or her to lose survivor benefits in your Account which the pension laws of the United States give to him or her.

 

The Waiver Election must be in writing on forms approved by the Committee, signed by you and consented to by your spouse.  Your Spouse’s consent must state the effect of the waiver on his or her right to your death benefits under the Plan.  Your Spouse’s consent must be witnessed by the Plan’s representative or a notary public.

 

At the appropriate time, the Committee will give you a written explanation of: (i) your right to sign, and the effect of, a Waiver Election; (ii) the rights of your Spouse to consent to any Waiver Election; and (iii) the right to sign, and the effect of, a cancellation of a previously signed Waiver.

 

 

Any Waiver Election, once signed, may be canceled or changed by you during your lifetime, as long as it is canceled or changed before you actually retire or die.  Any new Waiver Election made by you must also be consented to by your Spouse unless your Spouse signed a general waiver allowing you to change your beneficiary designation at any time without further consent.

 

Payment of the full amount in your Account must be made within five (5) years after your death. However, if you die after payment of your Account in installments has begun, the remaining portion of your Account will continue to be paid over the remaining installment period selected prior to your death.

 

If you die before payment of your Account has begun, the five-year period can be lengthened if you designated a Beneficiary to receive payment of the Account in installments over a longer period and such payments begin at the appropriate time.

 

Qualified Domestic Relations Order

 

The Committee will establish procedures to assure both you and your Spouse that your rights to your Account (and your Spouse’s interest in your Account) are preserved if your marriage is dissolved.  To comply with these procedures, your lawyer must get for you and your Spouse a “Qualified Domestic Relations Order” from a court of law. Participants and Beneficiaries can obtain, without charge, a copy of these procedures from the Committee.

 

If you remarry, the pension laws of the United States give to your new Spouse automatic survivor benefits in your Account. Because of this, the Committee may not be able to follow the Beneficiary designation on file if it does not provide for your new Spouse. To designate a Beneficiary other than your new Spouse, you will have to make a Waiver Election with his or her consent.

 

VIII. OTHER THINGS YOU SHOULD KNOW

 

A. Amendment and Termination.

 

The Company intends to continue the Plan; however, it has the right at any time to change the Plan in any way or even cancel the Plan, if it wants to do so.

 

If the Company changes the Plan the change will not take away any benefit you accrue before the Company actually adopts the change.  Trust assets still will only be available for Participants and Beneficiaries, or to pay Plan administration expenses.  Trust assets still will not be used to pay Company premiums or contributions under any other Company plan.  Any right you have under the Plan to select a particular form of distribution of your Plan benefits will not be taken away, if the benefit is protected under Section 411(d)(6) of the Internal Revenue Code of 1986, as amended.

 

 

If, while you are a Participant, the Plan is canceled or contributions are permanently stopped, you will become fully vested in the value of your Accounts regardless of your Years of Service.  In other words, any vesting schedule described above will be disregarded.  In addition, the Trust will continue until all Accounts have been distributed.

 

If you are affected by a partial termination of the Plan, you will also become fully vested in the value of your Accounts regardless of your Years of Service.

 

B. Benefits Not Guaranteed.

 

If the Plan terminates, benefits provided under this Plan are neither insured nor guaranteed by the Company, by the Pension Benefit Guaranty Corporation, a federal governmental agency, nor under any state or federal law.

 

C. The Committee.

 

The Committee is appointed by the Company. The Committee members serve without pay.  The Committee as agent for the Plan Administrator makes the rules under which the Plan is run, and sees to it that the Plan is run in a way which is fair to all Participants.  The Committee’s address and phone number are the same as the Company’s.

 

D. Making Elections.

 

Any elections, choices or waivers you make under the Plan (for example, choosing your Beneficiary) must be made in writing on forms acceptable to the Committee.

 

E. Claims Procedures.

 

If you (or after your death, your Beneficiary) feel that you are not receiving benefits which are due you, you must file a written claim for your benefits with a member of the Committee or officer of the Company.  The Committee will decide whether to grant or deny your claim. The Committee may notify you in writing prior to the termination of the initial 90-day period that it requires up to an additional ninety (90) days to consider your claim. The extension notice shall indicate the special circumstances requiring an extension of time and the date by which the plan expects to render the benefit determination.

 

Within ninety (90) days after filing your claim, the Committee shall provide you with written or electronic notification of any adverse benefit determination setting forth the specific reason or reasons of why your claim was denied, referring to the Plan provisions on which the decision was based. The notice will also tell you what, if anything, you can do in order to have your claim approved, and the Plan’s review procedures and the time limits applicable to such procedures.

 

 

You have the right to request, in writing, within sixty (60) days after you receive notice that your claim has been denied, a review of your denied claim, and you and your representative can review and copy Plan documents free of cost, which relate to your claim, and submit written comments to the Committee.  The claim will be reviewed by the Committee and you will receive written notice of the final decision of the Committee within sixty (60) days of the Committee’s receipt of your request for review. The Committee may notify you in writing that it requires up to an additional sixty (60) days to review your request for review.

 

F. Statement of ERISA Rights.

 

As a Participant in the Plan you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). ERISA provides that all Plan Participants will be entitled to:

 

Receive Information About Your Plan and Benefits

 

(1) Examine, without charge, at the Committee’s office and at other specified locations, such as worksites and union halls, all documents governing the Plan, including insurance contracts and collective bargaining agreements, and a copy of all documents filed by the Plan with the U.S. Department of Labor including annual report (Form 5500 Series) and plan descriptions, which is available at the Public Disclosure Room of the Employee Benefits Security Administration.

 

(2) Obtain, upon written request to the Committee’s, copies of documents governing the operation of the Plan, including insurance contracts and collective bargaining agreements, and copies of the latest annual report (Form 5500 Series) and updated summary plan description. The Committee may make a reasonable charge for the copies.

 

(3) Receive a summary of the Plan’s annual financial report. The Committee is required by law to furnish each Participant with a copy of this summary annual report.

 

(4) Obtain a statement telling you whether you have a right to receive a pension at Normal Retirement Age (as defined in Article IV) and if so, what your benefits would be at Normal Retirement Age if you stop working under the Plan now. If you do not have a right to a pension, the statement will tell you how many more years you have to work to get a right to a pension. This statement must be requested in writing and is

 

 

not required to be given more than once every twelve (12) months. The Plan must provide the statement free of charge.

 

Prudent Actions by Plan Fiduciaries

 

In addition to creating rights for Plan Participants ERISA imposes duties upon the people who are responsible for the operation of the employee benefit plan. The people who operate your Plan, called “fiduciaries” of the Plan, have a duty to do so prudently and in the interest of you and other Plan Participants and beneficiaries. No one, including your Company, your union, or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a pension benefit or exercising your rights under ERISA.

 

Enforce Your Rights

 

If your claim for a pension benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules.

 

Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of Plan documents or annual reports from the Plan and do not receive them within thirty (30) days, you may file suit in a federal court. In such a case, the court may require the Committee to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Committee. If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or federal court. In addition, if you disagree with the Plan’s decision or lack thereof concerning the qualified status of a domestic relations order or a medical child support order, you may file suit in federal court. If it should happen that Plan fiduciaries misuse the Plan’s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a federal court. The court will decide who should pay court costs and legal fees. If you are successful the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous.

 

Assistance with Your Questions

 

If you have any questions about your Plan, you should contact the Committee. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the Committee, you should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in your telephone directory or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue N.W., Washington, D.C. 20210. You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration.

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