Document:

Exhibit
4.1

 

 

 

 

 

 

 

 

 

 

 

 

SI
INTERNATIONAL, INC.

NONQUALIFIED DEFERRED COMPENSATION PLAN

BASIC
PLAN DOCUMENT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 2006

 

 

TABLE OF CONTENTS

	
  PREAMBLE

  	
   

  	
  1

  
	
   

  	
   

  	
   

  
	
  ARTICLE I

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  DEFINITIONS

  	
   

  	
  2

  
	
  1.1

  	
   

  	
  Account

  	
   

  	
  2

  
	
  1.2

  	
   

  	
  Adoption Agreement

  	
   

  	
  2

  
	
  1.3

  	
   

  	
  Beneficiary

  	
   

  	
  2

  
	
  1.4

  	
   

  	
  Board

  	
   

  	
  2

  
	
  1.5

  	
   

  	
  Certificate of Divestiture

  	
   

  	
  2

  
	
  1.6

  	
   

  	
  Change in Control Event

  	
   

  	
  2

  
	
  1.7

  	
   

  	
  Code

  	
   

  	
  2

  
	
  1.8

  	
   

  	
  Compensation

  	
   

  	
  2

  
	
  1.9

  	
   

  	
  Compensation Deferral Agreement

  	
   

  	
  2

  
	
  1.10

  	
   

  	
  Compensation Deferrals

  	
   

  	
  3

  
	
  1.11

  	
   

  	
  De Minimis Distribution

  	
   

  	
  3

  
	
  1.12

  	
   

  	
  Disability

  	
   

  	
  3

  
	
  1.13

  	
   

  	
  Distributable Event

  	
   

  	
  3

  
	
  1.14

  	
   

  	
  Domestic Relations Order

  	
   

  	
  3

  
	
  1.15

  	
   

  	
  Effective Date

  	
   

  	
  3

  
	
  1.16

  	
   

  	
  Eligible Service Provider

  	
   

  	
  3

  
	
  1.17

  	
   

  	
  ERISA

  	
   

  	
  4

  
	
  1.18

  	
   

  	
  Interim Distribution Date

  	
   

  	
  4

  
	
  1.19

  	
   

  	
  Investment Credits and Debits

  	
   

  	
  4

  
	
  1.20

  	
   

  	
  Investment Preferences

  	
   

  	
  4

  
	
  1.21

  	
   

  	
  Nonqualified Deferred Compensation Plan

  	
   

  	
  4

  
	
  1.22

  	
   

  	
  Participant

  	
   

  	
  4

  
	
  1.23

  	
   

  	
  Plan

  	
   

  	
  4

  
	
  1.24

  	
   

  	
  Plan Administrator

  	
   

  	
  4

  
	
  1.25

  	
   

  	
  Separation from Service

  	
   

  	
  5

  
	
  1.26

  	
   

  	
  Service Recipient

  	
   

  	
  5

  
	
  1.27

  	
   

  	
  Specified Employee

  	
   

  	
  5

  
	
  1.28

  	
   

  	
  Spouse

  	
   

  	
  6

  
	
  1.29

  	
   

  	
  Taxable Year

  	
   

  	
  6

  
	
  1.30

  	
   

  	
  Trust

  	
   

  	
  6

  
	
  1.31

  	
   

  	
  Trustee

  	
   

  	
  6

  
	
  1.32

  	
   

  	
  Unforeseeable Emergency

  	
   

  	
  6

  
	
  1.33

  	
   

  	
  Valuation Date

  	
   

  	
  6

  
	
  1.34

  	
   

  	
  Without Good Cause

  	
   

  	
  6

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  ELIGIBILITY AND PARTICIPATION

  	
   

  	
  7

  
	
  2.1

  	
   

  	
  Eligibility

  	
   

  	
  7

  
	
  2.2

  	
   

  	
  Participation

  	
   

  	
  7

  
	
  2.3

  	
   

  	
  Compensation Deferral Agreement

  	
   

  	
  7

  
	
  2.4

  	
   

  	
  Matching Credits and Discretionary Credits

  	
   

  	
  8

  
	
  2.5

  	
   

  	
  Establishing a Reserve for Plan Liabilities

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  PARTICIPANT ACCOUNTS AND REPORTS

  	
   

  	
  8

  
	
  3.1

  	
   

  	
  Establishment of Accounts

  	
   

  	
  8

  
	
  3.2

  	
   

  	
  Account Maintenance

  	
   

  	
  9

  
	
  3.3

  	
   

  	
  Investment Credits and Debits

  	
   

  	
  9

  
	
  3.4

  	
   

  	
  Participant Statements

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  WITHHOLDING OF TAXES

  	
   

  	
  11

  
	
  4.1

  	
   

  	
  Annual Withholding from Compensation

  	
   

  	
  11

  
	
  4.2

  	
   

  	
  Withholding from Benefit Distributions

  	
   

  	
  11

  

 ii
 

 

 

	
  

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  VESTING

  	
   

  	
  11

  
	
  5.1

  	
   

  	
  Vesting

  	
   

  	
  11

  
	
  5.2

  	
   

  	
  Eligibility for Grandfathering 

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  PAYMENTS

  	
   

  	
  12

  
	
  6.1

  	
   

  	
  Benefits

  	
   

  	
  12

  
	
  6.2

  	
   

  	
  Separation from Service Payment

  	
   

  	
  12

  
	
  6.3

  	
   

  	
  Conflict of Interest Divestiture

  	
   

  	
  13

  
	
  6.4

  	
   

  	
  Death Benefit

  	
   

  	
  13

  
	
  6.5

  	
   

  	
  Disability Benefit

  	
   

  	
  14

  
	
  6.6

  	
   

  	
  Domestic Relations Order Payment

  	
   

  	
  14

  
	
  6.7

  	
   

  	
  Unforeseeable Emergency Distribution

  	
   

  	
  14

  
	
  6.8

  	
   

  	
  Election to Receive Interim Distributions

  	
   

  	
  15

  
	
  6.9

  	
   

  	
  Beneficiary Designation

  	
   

  	
  15

  
	
  6.10

  	
   

  	
  Delay in Distributions

  	
   

  	
  16

  
	
  6.11

  	
   

  	
  Claims Procedure

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  TERMINATION OF DEFERRALS

  	
   

  	
  21

  
	
  7.1

  	
   

  	
  Unforeseeable Emergency

  	
   

  	
  21

  
	
  7.2

  	
   

  	
  Following a Hardship Distribution

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
  21

  
	
  ARTICLE VIII

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  PLAN ADMINISTRATION

  	
   

  	
  21

  
	
  8.1

  	
   

  	
  Appointment

  	
   

  	
  21

  
	
  8.2

  	
   

  	
  Duties of Plan Administrator

  	
   

  	
  22

  
	
  8.3

  	
   

  	
  Service Recipient

  	
   

  	
  22

  
	
  8.4

  	
   

  	
  Administrative Fees and Expenses

  	
   

  	
  22

  
	
  8.5

  	
   

  	
  Plan Administration and Interpretation

  	
   

  	
  23

  
	
  8.6

  	
   

  	
  Powers, Duties, Procedures

  	
   

  	
  23

  
	
  8.7

  	
   

  	
  Information

  	
   

  	
  23

  
	
  8.8

  	
   

  	
  Plan Administration Following a Change in Control
  Event

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  TRUST FUND

  	
   

  	
  24

  
	
  9.1

  	
   

  	
  Trust

  	
   

  	
  24

  
	
  9.2

  	
   

  	
  Unfunded Plan

  	
   

  	
  24

  
	
  9.3

  	
   

  	
  Assignment and Alienation

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  AMENDMENT AND PLAN TERMINATION

  	
   

  	
  24

  
	
  10.1

  	
   

  	
  Amendment

  	
   

  	
  24

  
	
  10.2

  	
   

  	
  Plan Termination

  	
   

  	
  25

  
	
  10.3

  	
   

  	
  Plan Termination Following a Change in Control Event

  	
   

  	
  25

  
	
  10.4

  	
   

  	
  Effect of Payment

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  MISCELLANEOUS

  	
   

  	
  25

  
	
  11.1

  	
   

  	
  Total Agreement

  	
   

  	
  25

  
	
  11.2

  	
   

  	
  Employment Rights

  	
   

  	
  26

  
	
  11.3

  	
   

  	
  Non-Assignability

  	
   

  	
  26

  
	
  11.4

  	
   

  	
  Binding Agreement

  	
   

  	
  26

  
	
  11.5

  	
   

  	
  Receipt and Release

  	
   

  	
  26

  
	
  11.6

  	
   

  	
  Furnishing Information

  	
   

  	
  26

  
	
  11.7

  	
   

  	
  Insurance

  	
   

  	
  27

  
	
  11.8

  	
   

  	
  Governing Law

  	
   

  	
  27

  
	
  11.9

  	
   

  	
  Headings and Subheadings

  	
   

  	
  27

  

 

 iii

 

 

PREAMBLE

The Service
Recipient, by executing the Nonqualified Deferred Compensation Plan Adoption
Agreement, hereby establishes or amends an unfunded Nonqualified Deferred
Compensation Plan for a select group of management or highly compensated
Service Providers.  Under the terms of
the Plan, Eligible Service Providers may elect to defer receipt of their
Compensation to a later Taxable Year.

Participants shall
have no right, either directly or indirectly, to anticipate, sell, assign or
otherwise transfer any benefit accrued under the Plan.  In addition, no Participant shall have any
interest in any Service Recipient assets set aside as a source of funds to
satisfy its benefit obligations under the Plan. 
Participants shall have the status of general unsecured creditors of the
Service Recipient and the Plan constitutes an unsecured promise by the Service
Recipient to make benefit payments in the future.

The Plan is
intended to be “a plan which is unfunded and is maintained by an employer
primarily for the purpose of providing deferred compensation for a select group
of management or highly compensated employees” within the meaning of Title I of
the Employee Retirement Income Security Act of 1974 (“ERISA”), and more
particularly described in DOL Reg. 2520.104-23(d). This plan is also intended
to comply with the requirements of IRC §409A, and the plan shall be interpreted
and administered consistent with the above statement.

 

 1

 

 

ARTICLE I

DEFINITIONS

1.1.                            Account  The
bookkeeping account established for each Participant to record his or her
benefit under the Plan.  Where the
context so requires, references to the Participant’s Account, or to the
Participant’s vested Account, shall mean the portion of the Account
attributable to a specific Taxable Year for which a benefit is payable.

1.2.                            Adoption Agreement 
The written instrument attached to this Basic Plan Document by which the
Service Recipient establishes a Nonqualified Deferred Compensation Plan for
Eligible Service Providers.

1.3.                            Beneficiary  An
individual, individuals, trust or other entity designated by the Participant to
receive his or her benefit in the event of the Participant’s death.  If more than one Beneficiary survives the
Participant, the Participant’s benefit shall be divided equally among all such
Beneficiaries, unless otherwise provided in the Beneficiary Designation
form.  Nothing herein shall prevent the
Participant from designating primary and contingent Beneficiaries.

1.4.                            Board  The Board
of Directors of the Service Recipient or similar governing body if the Service
Recipient has no Board of Directors.

1.5.                            Certificate of Divestiture  A
written determination within the meaning of IRC §1043(b)(2).

1.6.                            Change in Control Event  A
Change in Control as defined in Section IX(a) of the Adoption Agreement, which
also qualifies as a Change in Ownership, Change in Effective Control, or Change
in Ownership of a Substantial Portion of the Assets of the Service Recipient as
defined within the meaning of IRC §409A.

1.7.                            Code  The Internal
Revenue Code of 1986, as amended from time to time.  Reference to any section or subsection of the
Code includes reference to any comparable or succeeding provisions of any
legislation which amends, supplements or replaces such section or subsection.

1.8.                            Compensation 
Shall have the meaning elected by the Service Recipient in the Adoption
Agreement.

1.9.                            Compensation Deferral Agreement  The written
agreement between an Eligible Service Provider and the Service Recipient to
defer receipt by the Eligible Service Provider of Compensation.  Such agreement shall state the deferral
amount or percentage of Compensation to be withheld from the Eligible Service
Provider’s Compensation and shall state the date on which the agreement is
effective, as provided at Section 2.3.

 2
 

 

1.10.                     Compensation Deferrals 
That portion of an Eligible Service Provider’s Compensation which is
deferred under the terms of this Nonqualified Deferred Compensation Plan.

1.11.                     De Minimis Distribution  Shall have the meaning elected by the Service
Recipient in the Adoption Agreement.

1.12.                     Disability  A
Participant shall be considered disabled if the Participant (1) is unable to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result in
death or can be expected to last for a continuous period of not less than 12
months; or (2) is, by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than 3 months under an accident
and health plan covering Service Providers of the Participant’s Service
Recipient.

1.13.                     Distributable Event 
The events entitling a Participant or Beneficiary to a payment of
benefits under the Plan, which shall include: Separation from Service; death;
Disability; the occurrence of an Interim Distribution Date; the occurrence of
an Unforeseeable Emergency; and Plan Termination following a Change in Control
Event, if applicable; Plan Termination following a corporate dissolution or
bankruptcy, if applicable; Plan Termination following termination of all
deferred compensation arrangements of the same type, if applicable; a Change in
Control Event; Conflict of Interest Divestiture; and Domestic Relations Order.
Distribution resulting from a Separation of Service for a Specified Employee
may not be made before the date which is six (6) months after the Separation
from Service or, if earlier, the date of death of the Specified Employee.

1.14.                     Domestic Relations Order 
Any judgment, decree, or order (including approval of a property
settlement agreement) which relates to the provision of child support, alimony
payments, or marital property rights to a Spouse, former Spouse, child, or
other dependent of a participant and is made pursuant to a State domestic
relations law (including a community property law).

1.15.                     Effective Date 
The date selected in the Adoption Agreement as of which the Plan first
becomes effective or is amended.

1.16.                     Eligible Service Provider  Any
common-law employee, or non-employee director who provides services to the
Service Recipient designated by the Service Recipient as eligible to
participate in the Plan in accordance with Section 2.1.  Only those
individuals who are part of a select group of management or highly compensated
Eligible Service Providers, as determined by the Service Recipient in its sole
discretion, may be designated as Eligible Service Providers under the Plan.

 3
 

 

1.17.                     ERISA  The
Employee Retirement Income Security Act of 1974, as amended. Reference to any
section or subsection of ERISA includes reference to any comparable or
succeeding provisions of any legislation which amends, supplements or replaces
such section or subsection.

1.18.                     Interim Distribution Date  The first day of a Taxable Year that is five (5) years, seven (7)
years, or ten (10) years, as selected by the Participant at the time he or she
files a Compensation Deferral Agreement for a given Taxable Year, from the end
of the Taxable Year to which the Compensation Deferral Agreement applies, upon
which a distribution may be made to the Participant in accordance with Section
6.8 hereof.

1.19.                     Investment Credits and
Debits  Bookkeeping adjustments to Participants’
Accounts to reflect the hypothetical interest, earnings, appreciation, losses
and depreciation that would be accrued or realized if assets equal to the value
of such Accounts were invested in accordance with such Participants’
Investment Preferences.

1.20.                     Investment Preferences 
Hypothetical investment funds or benchmarks made available to
Participants by the Plan Administrator for purposes of valuing benefits under
the Plan.

1.21.                     Nonqualified Deferred Compensation Plan  A plan, within the meaning of
ERISA §201(2), the purpose of which is to permit a select group of management
or highly compensated Eligible Service Providers to defer receipt of a portion
of their Compensation to a future date.

1.22.                     Participant  An
Eligible Service Provider who is currently deferring a portion of his or her
Compensation under this Plan, or an Eligible Service Provider or former
Eligible Service Provider who is still entitled to the payment of benefits
under the Plan.

1.23.                     Plan  The
Nonqualified Deferred Compensation Plan established by the Service Recipient
under the terms of this Basic Plan Document and the accompanying Adoption
Agreement.

1.24.                     Plan Administrator 
The individual(s) or committee appointed by the Service Recipient (or,
following a Change in Control Event, appointed by the individual who,
immediately prior to such Change in Control Event, was the Chief Executive
Officer or most senior officer who is also a Participant) to administer the
Plan as provided herein.  If no such
appointment is made, the Chief Executive Officer of the Service Recipient shall
serve as the Plan Administrator.  In no
event shall a Plan Administrator who is a Participant be permitted to make
decisions regarding his or her benefits under this Plan.

 4
 

 

1.25.                     Separation from Service  The
voluntary or involuntary severing of employment from the Service Recipient and
any entity or business with which the Service Recipient would be considered a
single employer under Code §§414(b) and 414(c), for any reason other than
Disability or death.  Where a service
provider will continue to provide services for a service recipient (as an
employee or in some other capacity), separation from service will not have
occurred for purposes of §409A if (i) an employee continues to perform services
as an employee at an annual rate that is at least equal to 20% of the average
services rendered during the immediately preceding three full calendar years of
employment (if employed less than three years, such lesser period), and the
annual remuneration for such services is at least equal to 20% of the average
annual remuneration earned by the employee during the final three full calendar
years of employment (if employed less than three years, such lesser period); or
(ii) where an employee continues to perform services for a service
recipient  in a capacity other than as an
employee, at an annual rate that is at least equal to 50% of the average
services rendered during the immediately preceding three full calendar years of
employment (if employed less than three years, such lesser period), and the
annual remuneration for such services is at least equal to 50% of the average
annual remuneration earned by the employee during the final three full calendar
years of employment (if employed less than three years, such lesser period). A
director shall, for purposes of the Plan, be deemed to have incurred a
Separation from Service on the date the director is no longer a director or an
employee of the Service Recipient and any entity or business with which the
Service Recipient would be considered a single employer under Code §§414(b) and
414(c).

1.26.                     Service Recipient  The
corporation or business entity identified in Section I of the Adoption
Agreement, including any successor to such corporation or business that assumes
the obligations of such corporation or business.  The term Service Recipient shall also
include, where appropriate, any entity affiliated with the Service Recipient
which adopts the Plan with the consent of the Service Recipient and is listed
on Exhibit A attached to the Adoption Agreement.  Only the Service Recipient identified in
Section I of the Adoption Agreement shall have the power to amend this Plan,
serve as the Plan Administrator, or exercise any of the powers described in Section 8.3 hereof.

1.27.                     Specified Employee 
A key employee (as defined in Code Section 416(i) without regard to
paragraph (5) thereof) of a corporation any stock in which is publicly traded
on an established securities market or otherwise. Key employees are identified
based on the 12 month period ending on an identification date, as determined by
the Service Recipient. All individuals who are considered to be key employees  under IRC §416(i) during the identification
period must be treated as key employees for purposes of the plan during the 12
month period that begins on the first day of the 4th month following the close of the
identification period. An identification date must be used consistently and any
change to the identification date can not be effective for a period of at least
12 months.

 5
 

 

1.28.                     Spouse  The
individual to whom a Participant is married, or was married in the case of a
deceased Participant who was married at the time of his or her death.

1.29.                     Taxable Year  The
12-consecutive month period beginning each January 1 and ending each
December 31.

1.30.                     Trust  The
agreement, if any, between the Service Recipient and the Trustee under which
assets may be delivered by the Service Recipient to the Trustee to offset
liabilities assumed by the Service Recipient under the Plan.  Any assets held under the terms of the Trust
shall be the exclusive property of the Service Recipient and shall be subject
to the creditor claims of the Service Recipient with respect to whom such Trust
has been established.  Participants shall
have no right, secured or unsecured, to any assets held under the terms of the
Trust.

1.31.                     Trustee  The
institution named by the Service Recipient in the Trust agreement, if any, and
any corporation which succeeds the Trustee by merger or by acquisition of
assets or operation of law.

1.32.                     Unforeseeable Emergency  A
severe financial hardship to the Participant resulting from an illness or
accident of the Participant, the Participant’s Spouse, or a dependent (as
defined in Code §152(a)) of the Participant, loss of the Participant’s property
due to casualty, or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of the Participant.

1.33.                     Valuation Date 
The date on which Participant Accounts under the Plan are valued.  The Valuation Date shall be each business day
of the Taxable Year on which the New York Stock Exchange and, if a Trust has
been established in connection with the Plan, the Trustee are open for
business.

1.34.                     Without Good Cause  A Participant’s involuntary Separation from
Service from the Service Recipient shall be without good cause if it occurs for
reasons other than the Participant’s commission of a crime involving dishonesty
or moral turpitude (e.g., fraud, theft, embezzlement, deception, etc.);
misconduct, including but not limited to insubordinate behavior, by the
Participant in the performance of his or her job duties and responsibilities;
any conduct by the Participant of a nature which reflects negatively upon the
Service Recipient or which would prevent the Participant from being able to
adequately perform his or her job duties and responsibilities (e.g.,
malicious, willful and wanton, or negligent conduct, etc.); the Participant’s
failure to adequately perform his/her duties and responsibilities as such
duties and responsibilities are, from time to time in the Service Recipient’s
absolute discretion, determined; and the Participant’s breach of any of the
Service Recipient’s established operating policies and procedures.

 6
 

 

ARTICLE
II

ELIGIBILITY AND
PARTICIPATION

2.1                                           Eligibility  The
Service Recipient will designate in the Adoption Agreement those persons who
shall be considered Eligible Service Providers under the Plan.

2.2                                           Participation
The Plan Administrator shall provide written notification to each
Eligible Service Provider of his or her eligibility to participate in the Plan.

2.3                                           Compensation
Deferral Agreement  In order to
defer Compensation under the Plan for a given Taxable Year, an Eligible Service
Provider must enter into a Compensation Deferral Agreement with the Service
Recipient authorizing the deferral of all or part of the Participant’s
Compensation for such Taxable Year.  The
Compensation Deferral Agreement shall also specify the method of payment for
benefits under the Plan and, if applicable, an Interim Distribution Date that
shall apply with respect to any amounts credited to the Participant’s Account
for such Taxable Year.

Notwithstanding anything
to the contrary in this Plan, to make a Compensation Deferral for a Taxable
Year, a Participant shall first have made the maximum pre-tax deferral
permitted under the Employer’s tax qualified plan.

All Compensation Deferral
Agreements must be completed prior to the first day of the Taxable Year to
which they relate. A Service Provider, newly eligible for participation in the
Plan, may make a deferral election within the first 30 days of participation in
the plan. In no event shall a Participant be permitted to defer Compensation
with respect to services performed before the date on which the Compensation
Deferral Agreement is signed by the Participant and accepted by the Plan
Administrator.

In the case of any Performance Based Compensation, if
elected by the Service Recipient in the Adoption Agreement, based on services
performed over a period of at least twelve (12) months, a Compensation Deferral
Agreement for Performance Based Compensation may be made no later than six months
before the end of the period

Upon receipt of a properly completed and executed
Compensation Deferral Agreement, the Plan Administrator shall notify the
Service 

 7
 

 

Recipient to commence to withhold that portion of the
Participant’s Compensation specified in the Agreement. In no event will the
Participant be permitted to defer more or less than the amount(s) specified by
the Service Recipient in the Adoption Agreement.

The Compensation Deferral Agreement shall remain in
effect for the duration of the Taxable Year to which it relates unless
terminated.

Subject to compliance with Section 409A of the Code,
the Service Recipient shall have the right to terminate a Participant’s
Compensation Deferral Agreement at any time upon written notice to the
Participant. Such termination shall be effective of the first day of the next
payroll period. In no event shall the Service Recipient have the right to
terminate a Compensation Deferral Agreement with respect to Compensation
already deferred. Notwithstanding anything in this Plan to the contrary,
terminating a Participant’s Compensation Deferral Agreement is not a
distributable event.

2.4                                                 Matching Credits and Discretionary Credits  The Service Recipient may adjust the Account
of a Participant with matching or discretionary credits.  The amount of the Discretionary Credits
and/or Matching Credits and the formula(s) for allocating such credits will be
selected by the Service Recipient in the Adoption Agreement.

2.5                                           Establishing
a Reserve for Plan Liabilities 
The Service Recipient may, but is not required to, establish one or more
Trusts to which the Service Recipient may transfer such assets as the Service
Recipient determines in its sole discretion to assist in meeting its
obligations under the Plan.  Any such
assets shall be the property of the Service Recipient and remain subject to the
claims of the Service Recipient’s creditors, to the extent provided under any
Trust established with respect to such Service Recipient.  The Trustee shall have no duty to determine
whether the amounts forwarded by the Service Recipient are the correct amount
or that they have been transmitted in a timely manner.

ARTICLE
III

PARTICIPANT ACCOUNTS AND REPORTS

3.1.                            Establishment of Accounts  The Plan Administrator shall establish and
maintain individual recordkeeping accounts on behalf of each Participant for
purposes of determining each Participant’s benefits under the Plan. A
Participant’s Account does not represent the Participant’s ownership of, or any
ownership interest in, any assets which may be set aside to satisfy the Service
Recipient’s obligations under the Plan.

 8
 

 

3.2.                            Account Maintenance  As
of each Valuation Date, the Plan Administrator shall credit each Participant’s
Account with the following:

(a)          An amount equal to any
Compensation Deferrals made by the Participant since the last Valuation Date;

(b)         An amount equal to any
Matching Credits or Discretionary Credits, and any forfeitures, if applicable,
since the last Valuation Date; and

(c)          An amount equal to
deemed Investment Credits under Section
3.3 below since the last Valuation Date.

As of each Valuation Date, the Plan Administrator
shall debit each Participant’s Account with the following:

(d)         An amount equal to any
distributions from the Plan to the Participant or Beneficiary since the last
Valuation Date; and

(e)          An amount equal to
deemed Investment Debits under Section
3.3 below since the last Valuation Date; and

(f)            An amount equal to any
forfeitures incurred by the Participant since the last Valuation Date.

3.3.                            Investment Credits and Debits   The Accounts of Participants shall be
adjusted for Investment Credits and Debits in accordance with this Section 3.3.

Participants shall have the right to specify one or
more Investment Preferences in which their Compensation Deferrals, Matching
Credits and Discretionary Credits shall be deemed to be invested.  The Investment Preferences shall be utilized
solely for purposes of adjusting their Accounts in accordance with procedures
adopted by the Plan Administrator. The Plan Administrator shall provide the
Participant with a list of the available Investment Preferences.  From time to time, in the sole discretion of
the Plan Administrator, the Investment Preferences available within the Plan
may be revised. All Investment Preference selections must be denominated in
whole percentages unless the Plan Administrator determines that lower
increments are acceptable.  A Participant
may make changes in the manner in which future Compensation Deferrals, Matching
Credits and/or Discretionary Credits are deemed to be invested among the
various Investment Preferences within the Plan in accordance with procedures
established by the Plan Administrator.  A
Participant may re-direct the manner in which earlier Compensation Deferrals,
Matching Credits and/or Discretionary Credits, as well as any appreciation (or
depreciation) to-date, are deemed to be invested among the Investment
Preferences available in the Plan in accordance with procedures established by
the Plan Administrator.

 9
 

 

As of each Valuation Date, the Plan Administrator
shall adjust the Account of each Participant for interest, earnings or
appreciation (less losses and depreciation) with respect to the then balance of
the Participant’s Account equal to the actual results of the Participant’s
deemed Investment Preference elections.

All notional
acquisitions and dispositions of Investment Preferences which occur within a
Participant’s Account, pursuant to the terms of the Plan, shall be deemed to
occur at such times as the Plan Administrator shall determine to be
administratively feasible in its sole discretion and the Participant’s Account
shall be adjusted accordingly. 
Accordingly, if a distribution or reallocation must occur pursuant to
the terms of the Plan and all or some portion of the Account must be valued in
connection with such distribution or reallocation (to reflect Investment
Credits and Debits), the Plan Administrator may in its sole discretion, unless
otherwise provided for in the Plan, select a date or dates which shall be used
for valuation purposes.

Notwithstanding anything to the contrary, any
Investment Credits or Debits made to any Participant’s Account following a Plan
Termination or a Change in Control Event shall be made in a manner no less
favorable to Participants than the practices and procedures employed under the
Plan, or as otherwise in effect, as of the date of the Plan Termination or the
Change in Control Event.

Notwithstanding the Participant’s deemed Investment
Preference elections under the Plan, the Service Recipient shall be under no
obligation to actually invest any amounts in such manner, or in any manner, and
such Investment Preference elections shall be used solely to determine the
amounts by which the Participant’s Account shall be adjusted under this Section 3.3.

3.4.                            Participant Statements   The
Plan Administrator shall provide each Participant with a statement showing the
credits and debits from his or her Account during the period from the last
statement date.  Such statement shall be
provided to Participants as soon as administratively feasible following the end
of each Taxable Year and on such other dates as agreed to by the Service
Recipient and the party maintaining Participant records.

 10
 

 

ARTICLE
IV

WITHHOLDING
OF TAXES

4.1.                            Withholding from Compensation  For any Taxable Year in which Compensation
Deferrals, Matching Credits and/or Discretionary Credits are made to or vested
within the Plan (as applicable), the Service Recipient shall withhold the
Participant’s share of FICA and other employment taxes from the portion of the
Participant’s Compensation not deferred. 
If deemed appropriate by the Service Recipient, the amount of
compensation deferred pursuant to the Participant’s Compensation Deferral
Agreement may be reduced in certain instances where necessary to facilitate
compliance with applicable withholding requirements.

4.2.                            Withholding from Benefit Distributions  The Participant’s Service Recipient (or the
Trustee of the Trust, as applicable) shall withhold from any payments made to a
Participant under this Plan all federal, state and local income, employment and
other taxes required to be withheld by the Service Recipient, in connection
with such payments, in amounts and in a manner to be determined in the sole
discretion of the Service Recipient.

ARTICLE V

VESTING

5.1.                            Vesting  A
Participant shall be immediately vested in (i.e., shall have a
non-forfeitable right to) all Compensation Deferrals credited to his or her
Account, including any Investment Credits or Debits associated therewith.  The Service Recipient shall specify in the
Adoption Agreement the vesting provisions applicable to any Discretionary
Credits or Matching Credits allocated to the Accounts of Participants. Upon a
Distributable Event, except as otherwise provided under the Plan, any amount of
the benefit payment credited to the Account of the Participant that is not
vested shall be forfeited.  Forfeitures
incurred by a Participant shall reduce the amounts credited to a Participant’s
Account, but shall not be reallocated to the Accounts of other Participants
unless otherwise specified in the Adoption Agreement.  A distribution for a Domestic Relations Order
Payment under Section 6.6 shall be made from the Account of the Participant
only to the extent it is vested.

5.2.                            Eligibility for Grandfathering  Any
amount that is earned and vested in an account balance before January 1, 2005,
plus any earnings with respect to such amounts, will be considered eligible for
“grandfathering”, and, therefore, not subject to §409A, unless a “material
modification” (as defined in §409A, its guidance or regulations) is made after
October 3, 2004 with respect to such deferrals.

 11
 

 

ARTICLE
VI

PAYMENTS

6.1.                            Benefits  Except
as otherwise provided under the Plan, a Participant’s or Beneficiary’s benefit
payable under the Plan shall be the value of the Participant’s vested Account
at the time a Distributable Event occurs under the Plan with respect to such
Participant or Beneficiary.  A
Participant’s or Beneficiary’s benefit payable under the Plan shall be the
value of the Participant’s vested Account on the date a Distributions for the
Domestic Relations Order Payments under Section 6.6 or distributions to comply
with a Conflict of Interest Divestiture under Section 6.3. Such benefit shall
be payable from the general assets of the Service Recipient.  In no event, will a Participant’s right to a
benefit under this Plan give such Participant a secured right or claim on any
assets set aside by the Service Recipient to meet its obligations under the
Plan.   All payments from the Plan shall
be subject to applicable tax withholding and shall commence (or be fully paid,
in the event a lump sum form of distribution was selected) no later than sixty
(60) days after the occurrence of the Distributable Event, except as otherwise
provided herein. A payment will be treated as made upon the designated payment
date if the payment is made by the later of (i) the first date that it is
administratively practicable to make such payment on or after the designated
payment date, or (ii) the end of the calendar year containing the designated
date (or the end of the calendar year if only a year is designated).

6.2.                            Form of Benefit Payment 
In the event of a Participant’s Separation from Service, the Participant’s
vested Account shall be paid in the form of a cash lump sum or in annual cash
payments (over a period of five (5), ten (10), or fifteen (15) years), as
elected by the Participant. If applicable, the initial installment shall be
based on the value of the Participant’s vested Account, measured on the date of
his or her Separation from Service, and shall be equal to 1/n (where ‘n’ is
equal to the total number of annual benefit payments not yet distributed).  Subsequent installment payments shall be
computed in a consistent fashion, with the measurement date being the
anniversary of the original measurement date. 
Notwithstanding the Participant’s election regarding the form of the
Separation from Service Payment, the Service Recipient shall have the right to
make a De Minimis Distribution, as elected by the Service Recipient in the
Adoption Agreement, and pay the Participant’s or Beneficiary’s benefit or
remaining benefit in a single lump sum payment. 
Election of the form of the Separation from Service Payment must be
provided to the Plan Administrator at the time the Participant first enters
into a Compensation Deferral Agreement.

 12
 

 

Payments made by reason
of a Change in Control Event, shall be made in a cash lump sum.

A payment to a Specified
Employee must be delayed for at least 6 months, or until death, if earlier.

If determined by the
Service Recipient in the Adoption Agreement, 
Participants may be permitted to subsequently elect a change in the
timing or the form of the Separation from Service Payment, as previously
selected, by submitting the appropriate form to the Plan Administrator. The Plan Administrator shall have sole and
absolute discretion to decide whether such a request shall be approved but may
approve no more than three such requests for any Participant, and such
change in form shall be effective only if:

(a)          it does not accelerate
the time or schedule of any payment;

(b)         such election does not
take effect until at least twelve (12) months after the date on which the
election is made;

(c)          such election is made
not less than 12 months before a scheduled event; and

(d)         the first payment with
respect to which such election is made is deferred for a period of five (5)
years from the date such payment would otherwise have been made.

6.3.                            Conflict of Interest Divestiture  If it is necessary for a Participant to comply
with a Certificate of Divestiture, whether before or after the Participant has
otherwise incurred a Distributable Event or commenced receiving payments from
the Plan, the Plan Administrator, shall pay to the Participant the balance of
the Participant’s vested Account in a single lump sum cash payment.  A Participant requesting a payment to comply
with a Certificate of Divestiture shall apply for the payment in writing on a
form approved by the Plan Administrator and shall provide such additional
information as the Plan Administrator may require.  The Plan Administrator shall have complete
discretion to determine whether the circumstances of the Participant constitute
a Conflict of Interest Divestiture under the Plan.  If the Plan Administrator approves the
request for a payment to comply with a Certificate of Divestiture, the
distribution shall be made no later than sixty (60) days after the date of
approval by the Plan Administrator.

6.4.                            Death Benefit  In
the event of the Participant’s death, whether before or after the Participant
has otherwise incurred a Distributable Event or commenced receiving payments
from the Plan, the Participant’s Beneficiary shall receive the balance of the
Participant’s vested Account in a single lump sum cash payment.

 13

 

 

6.5.                            Disability Benefit 
If a Participant suffers a Disability, whether before or after the
Participant has otherwise incurred a Distributable Event or commenced receiving
payments from the Plan, the Plan Administrator, shall pay to the Participant
the balance of the Participant’s vested Account in a single lump sum cash
payment.  A Participant requesting a
payment due to Disability shall apply for the payment in writing on a form
approved by the Plan Administrator and shall provide such additional information
as the Plan Administrator may require. 
The Plan Administrator shall have complete discretion to determine
whether the circumstances of the Participant constitute a Disability under the
Plan.  If the request for a payment due
to a Disability is approved, the distribution shall be made no later than sixty
(60) days after the date of approval by the Plan Administrator.

6.6.                            Domestic Relations Order Payment  If it is necessary to comply with a Domestic
Relations Order, whether before or after the Participant has otherwise incurred
a Distributable Event or commenced receiving payments from the Plan, the Plan
Administrator, shall pay to the Spouse, former Spouse, child, or other
dependent of the Participant, as specified in the Domestic Relations Order, the
amount from the Participant’s vested Account required to fulfill the Domestic
Relations Order in a single lump sum cash payment.  A Participant requesting a payment pursuant
to a Domestic Relations Order shall apply for the payment in writing on a form
approved by the Plan Administrator and shall provide such additional
information as the Plan Administrator may require.  The Plan Administrator shall have complete
discretion to determine whether the circumstances of the Participant constitute
a Domestic Relations Order Payment under the Plan.  If, subject to the sole discretion of the
Plan Administrator, the request for a payment due to a Domestic Relations Order
is approved, the distribution shall be no later than sixty (60) days after the
date of approval by the Plan Administrator. Notwithstanding the provisions of
Section 6.4, in the event of the Participant’s death, whether before or after
the Participant has otherwise incurred a Distributable Event or commenced
receiving payments from the Plan, the Spouse, former Spouse, child, or other
dependent of the Participant, as specified in the Domestic Relations Order,
shall receive the amount from the Participant’s vested Account required to
fulfill the Domestic Relations Order in a single lump sum cash payment.

6.7.                            Unforeseeable Emergency Distribution  If a Participant suffers an Unforeseeable
Emergency, as defined herein, the Plan Administrator, in its sole discretion,
may pay to the Participant that portion of his or her vested Account which the
Plan Administrator determines is necessary to satisfy the emergency. The
amounts distributed to the Participant as a result of an Unforeseeable
Emergency may not exceed the amounts necessary to satisfy such emergency plus
amounts necessary to pay anticipated taxes reasonably anticipated as a result
of the distribution, 

 14
 

 

                                                            after taking into account the extent
to which such hardship is or may be relieved through reimbursement or
compensation by insurance or otherwise or by liquidation of the Participant’s
assets (to the extent the liquidation of such assets would not itself cause
severe financial hardship).  A
Participant requesting an Unforeseeable Emergency Distribution shall apply for
the payment in writing on a form approved by the Plan Administrator and shall
provide such additional information as the Plan Administrator may require.  The Plan Administrator shall have complete
discretion to determine whether the financial hardship of the Participant
constitutes an Unforeseeable Emergency under the Plan.  If, subject to the sole discretion of the
Plan Administrator, the request for a withdrawal is approved, the distribution
shall be made within sixty (60) days of the date of approval by the Plan
Administrator.

6.8.                            Election to Receive Interim Distributions  A Participant may make an irrevocable advance
election, at the time he or she files a Compensation Deferral Agreement for a
given Taxable Year, to have those Compensation Deferrals to which the agreement
relates paid to him or her at an Interim Distribution Date designated by the
Participant.  Any Matching Credits and/or
Discretionary Credits attributable to such Compensation Deferrals that are
vested as of the Interim Distribution Date shall also be payable.  Such Compensation Deferrals, vested Matching
Credits and/or vested Discretionary Credits, adjusted to reflect Investment
Credits and Debits, shall be payable in a single cash lump sum payment within
sixty (60) days of such Interim Distribution Date.  The Participant’s selection of an Interim
Distribution Date is irrevocable and must comply with the definition of Interim
Distribution Date under Section 1.18  Notwithstanding a Participant’s advance
election to designate an Interim Distribution Date or Dates, the amounts which
would otherwise be subject to such Interim Distribution Date or Dates shall be
distributable upon a Distributable Event pursuant to the Plan, if such
Distributable Event occurs prior to any Interim Distribution Date.

6.9.                            Beneficiary Designation  A Participant shall have the right to
designate a Beneficiary and to amend or revoke such designation at any time in
writing.  Such designation, amendment or
revocation shall be effective upon receipt by the Plan Administrator.   If the Beneficiary is a minor or
incompetent, benefits may be paid to a legal guardian, trustee, or other proper
representative of the Beneficiary, and such payment shall completely discharge
the Service Recipient and the Plan of all further obligations hereunder.

If no Beneficiary designation is made, or if the
Beneficiary designation is held invalid, or if no Beneficiary survives the
Participant and benefits are determined to be payable following the Participant’s
death, the Plan Administrator shall direct that payment of benefits be made to
the person or persons in the first of the below categories in which there is a
survivor.  The categories of successor
beneficiaries, in order, are as follows:

 15
 

 

(a)          Participant’s Spouse;

(b)         Participant’s
descendants, per stirpes (eligible descendants
shall be determined by the intestacy laws of the state in which the decedent
was domiciled);

(c)          Participant’s parents;

(d)         Participant’s brothers
and sisters (including step brothers and step sisters); and

(e)          Participant’s estate.

6.10.                     Delay in Distributions 
Payment of benefits under the Plan may be delayed without violating the
IRC,§409A, or the applicable regulations, as follows, and as determined by the
Service Recipient in the Adoption Agreement:

(a)          Payments subject to Code
§162(m).  A payment may be delayed where
the Service Recipient reasonably anticipates that a deduction with respect to
the payment will be limited/eliminated by application of Code §162(m). In such
an event, the payment will be made either at the earliest date at which the
Service Recipient reasonably anticipates the deduction would not be
limited/eliminated or the calendar year in which the Service Provider separates
from service. In the event this provision is subsequently removed from the
Plan, it must be effective only with respect to amounts deferred after the Plan
is amended to remove the provision.

(b)         Payments that violate a
loan covenant or similar contractual requirement.  A payment may be delayed if such payment
would violate a loan covenant or other contractual requirement. In such an
event, payment will be made in the first calendar year in which the employer
reasonably anticipates that the payment would not violate such loan covenant or
contractual requirement.

(c)          Payments that would
violate Federal Securities law or other applicable law.  In such an event, payment will be made in the
first calendar year in which the employer reasonably anticipates that the
payment would not result in a violation of Federal Securities law or other
applicable law.

6.11.                     Claims Procedure 
All claims for benefits under the Plan, and all questions regarding the
operation of the Plan, shall be submitted to the Plan Administrator in
writing.  The Plan Administrator has sole
discretion and authority to interpret and construe any provision of the Plan,
and its decisions regarding claims for benefits hereunder are final and
binding.

 16
 

 

(a)          Presentation
of Claim  Any Participant
or Beneficiary of a deceased Participant (such Participant or Beneficiary being
referred to below as a “Claimant”) may deliver to the Plan Administrator a
written claim for a determination with respect to the amounts distributable to
such Claimant from the Plan.  The claim
must state with particularity the determination desired by the Claimant.

Any claim by a Participant that a payment made under
the Plan is inadequate or is less than the amount to which the Participant is
entitled must be made in writing pursuant to the foregoing provisions of this
Section within 180 days of the date of such payment.  Notwithstanding any other provision of the
Plan, including the provisions of Section 5.1, a Participant shall forfeit all
rights to any amounts claimed if the Participant fails to make claim as
provided in the preceding sentence.

(b)         Notification
of Decision  The Plan
Administrator shall consider a Claimant’s claim within a reasonable time, and
shall notify the Claimant in writing:

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

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

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

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

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

4)              a description of the
claim review procedure set forth in Section
6.11(c) below, including information regarding any applicable time
limits and a statement regarding the Claimant’s right to bring an action under
ERISA §502(a) following an adverse determination on review; and

 17
 

 

5)              if the decision
involved the Disability of the Participant, information regarding whether an
internal rule or procedure was relied upon in making its decision and that the
Claimant can request a copy of such rule or procedure, free of charge, upon
request.

The Plan Administrator will notify the Claimant of an
adverse decision within ninety (90) days of the date the claim was received,
unless the Plan Administrator determines there are special circumstances that
require an extension of time in which to make a decision.  If an extension of time is needed, the Plan
Administrator shall notify the Claimant of the extension before the expiration
of the original 90-day period.  The
notice will include a description of the special circumstances requiring an
extension of time and an estimate of the date it expects a decision to be
made.  The extension shall not exceed an
additional 90-day period.

If the adverse decision relates to a claim involving
the Disability of the Participant, the Plan Administrator will notify the Claimant
of an adverse decision within forty-five (45) days of the date the claim was
received, unless the Plan Administrator determines that matters beyond its
control require an extension of time in which to make a decision.  If an extension of time is needed, the Plan
Administrator shall notify the Claimant of the extension before the expiration
of the original 45-day period.  The
notice will include a description of the circumstances necessitating the
extension and an estimate of the date it expects a decision to be made.  The extension shall not exceed an additional
30-day period unless, within the 30-day period the Plan Administrator again
determines that more time is needed due to matters beyond its control, in which
case notice of the need for not more than an additional thirty (30) days is
provided to the Claimant before the first 30-day period expires. The notice
will include a description of the circumstances requiring the extension and an
estimate of the date it expects a decision to be made.  Any extension notice will include information
regarding the standards on which a determination of Disability will be made,
the outstanding issues which prevent a decision from being made, and any
additional information which is needed in order to reach a decision.  The Claimant will have forty-five (45) days
to supply any additional information.

If the Plan Administrator notifies the Claimant of the
need for an extension of time to make a decision regarding his or her claim in
accordance with this Section
6.11(b), and the extension is needed due to the Claimant’s failure to
provide information necessary to decide the claim, the period of time in which
the Plan Administrator must make a decision does not include the time between
the date the notice of the extension was sent to the Claimant and the date the
Claimant responds to the request for additional information.

 18
 

 

(c)          Review of a Denied Claim 
Within sixty (60) days after receiving a notice from the Plan
Administrator that a claim has been denied, in whole or in part, a Claimant (or
the Claimant’s duly authorized representative) may file with the Plan
Administrator a written request for a review of the denial of the claim.  During the 60-day review period, the Claimant
(or the Claimant’s duly authorized representative):

i.)        may review relevant documents;

ii.)             may submit written
comments or other documents relating to the claim;

iii.)          may request access to
and copies of all relevant documents, free of charge;

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

The Plan Administrator will consider all documents and
other information submitted by the Claimant in reviewing its previous decision,
including documents not available to or considered by it during its initial
determination.

If the appeal relates to a determination of the Plan
Administrator involving the Disability of the Participant, the Claimant will
have one-hundred-eighty (180) days following receipt of a denial to file a
written request for review.  In such
event, no deference shall be given to the initial benefit determination, and
the review shall be conducted by an appropriate fiduciary who is someone other
than the individual who made the initial determination or a subordinate of such
individual.  If the initial determination
was based in whole or in part on a medical judgment, the reviewer shall consult
with an appropriately trained and experienced health care professional, and
shall disclose the identity of any experts who provided advice with regard to
the initial decision.  The health care
professional whose advice is sought during the appeal process will not be an
individual who was consulted during the initial determination, nor a
subordinate of such an individual.

(d)         Decision on Review  The Plan Administrator shall render its
decision on   review promptly, and not
later than sixty (60) days after the filing of a written request for review of
the denial, unless a hearing is held or other special circumstances require
additional time, in which case the Plan Administrator’s decision must be 

 19
 

 

                        rendered
within one hundred twenty (120) days after such date. If an extension of time
is needed, the Plan Administrator shall notify the Claimant of the extension
before the expiration of the original 60-day period. The notice will include a
description of the circumstances requiring the extension and an estimate of the
date it expects a decision to be made. 
Such decision must be written in a manner calculated to be understood by
the Claimant, and if the decision on review is adverse it must contain:

i.)              specific reasons for
the decision;

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

iii.)        a statement that the
Claimant may receive, upon request and free of charge, access to and copies of
relevant documents and information;

iv.)       a statement describing any
voluntary appeal procedures under the Plan and the Claimant’s right to bring an
action under ERISA §502(a);

v.)          if the decision involved
the Disability of the Participant, information regarding whether an internal
rule or procedure was relied upon in making its decision and that the Claimant
can request a copy of such rule or procedure, free of charge, upon request;

vi.)       if the decision involved
the Disability of the Participant, a statement 
that the Claimant and the Plan may have other voluntary alternative
dispute resolution options, such as mediation, and that the Claimant may find
out what options are available by contacting the local U.S. Department of Labor
Office and the state insurance regulatory agency; and

vii.)      such other matters as the
Plan Administrator deems relevant.

If the appeal involves the Disability of the
Participant, the decision of the Plan Administrator will be made within
forty-five (45) days after the filing of the written request for review, unless
special circumstances require additional time, in which case the Plan
Administrator’s decision will be made within ninety (90) days after the date
the request was filed. If an extension of time is needed, the Plan
Administrator shall notify the Claimant of the extension before the expiration
of the original 45-day period. The notice will include a description of the
circumstances requiring the extension and an estimate of the date it expects a
decision to be made.

 20
 

 

If the Plan Administrator notifies the Claimant of the
need for an extension of time to make a decision regarding his or her appeal in
accordance with this Section
6.11(d), and the extension is needed due to the Claimant’s failure to
provide information necessary to decide the appeal, the period of time in which
the Plan Administrator must make a decision does not include the time between
the date the notice of the extension was sent to the Claimant and the date the
Claimant responds to the request for additional information.

ARTICLE
VII

TERMINATION
OF DEFERRALS

7.1.                            Unforeseeable Emergency 
If a Participant suffers an Unforeseeable Emergency, as defined herein,
the Plan Administrator, in its sole discretion, may terminate any future
Compensation Deferrals pertaining to compensation not yet earned required to be
made pursuant to the Participant’s current Compensation Deferral
Agreement.  If the petition for a
termination of Compensation Deferrals is approved, it shall be effective upon
the date of approval.  A Participant
requesting a termination of Compensation Deferrals as a result of an
Unforeseeable Emergency shall apply for the termination in writing on a form
approved by the Plan Administrator and shall provide such additional
information as the Plan Administrator may require.  The Plan Administrator shall have sole
discretion to determine whether the financial hardship of the Participant
constitutes an Unforeseeable Emergency under the Plan.  The Participant’s eligibility for Employer
Matching Credits and/or Employer Discretionary Credits shall be similarly
terminated.

7.2.                            Following
a Hardship Distribution   If a
Participant receives a hardship distribution under a qualified plan with a
qualified cash or deferred arrangement under Section 401(k), the Participant’s
future Compensation Deferrals pertaining to compensation not yet earned by the
Eligible Service Provider shall be terminated as the Plan Administrator, in its
complete and absolute discretion, determines. The Participant’s eligibility for
Service Recipient Matching Credits and Service Recipient Discretionary Credits
may be similarly terminated.

ARTICLE
VIII

PLAN ADMINISTRATION

8.1.                            Appointment  The
Plan Administrator shall serve at the pleasure of the Service Recipient, who
shall have the right to remove the Plan Administrator at any time upon thirty
(30) days written notice.  The Plan
Administrator shall have the right to resign upon thirty (30) days written
notice to the Service Recipient.

 21
 

 

8.2.                            Duties of Plan Administrator  The
Plan Administrator shall be responsible to perform all administrative functions
of the Plan.  These duties include but
are not limited to:

(a)          Communicating with
Participants in connection with their rights and benefits under the Plan.

(b)         Reviewing Investment Preference
elections received from Participants.

(c)          Arranging for the
payment of taxes (including income tax withholding), expenses and benefit
payments to Participants under the Plan.

(d)         Filing any returns and
reports due with respect to the Plan.

(e)          Interpreting and
construing Plan provisions and settling claims for Plan benefits.

(f)            Serving as the Plan’s
designated representative for the service of notices, reports, claims or legal
process.

(g)         Employing any agents such
as accountants, auditors, attorneys, actuaries or any other professionals it
deems necessary in the performance of any of its duties.

8.3.                            Service Recipient  The
Service Recipient has sole responsibility for the establishment and maintenance
of the Plan.  The Service Recipient
through its Board shall have the power and authority to appoint the Plan
Administrator, Trustee and any other professionals as may be required for the
administration of the Plan.  The Service
Recipient shall also have the right to remove any individual or party appointed
to perform administrative, investment, fiduciary or other functions under the
Plan.  The Service Recipient may delegate
any of its powers to the Plan Administrator, Board member or a committee of the
Board.

8.4.                            Administrative Fees and Expenses  All reasonable costs, charges and expenses
incurred by the Plan Administrator or the Trustee in connection with the
administration of the Plan or the Trust shall be paid by the Service
Recipient.  If not so paid, such costs,
charges and expenses shall be charged to the Trust, if any, established in
connection with the Plan.  The Trustee
shall be specifically authorized to charge its fees and expenses directly to
the Trust. If the Trust has insufficient liquid assets to cover the applicable
fees, the Trustee shall have the right to liquidate assets held in the Trust to
pay any fees or expenses due. 
Notwithstanding the foregoing, no Compensation other than reimbursement
for expenses shall be paid to a Plan Administrator who is a Service Provider of
the Service Recipient.

 22
 

 

8.5.                            Plan Administration and Interpretation  The Plan Administrator shall have complete
discretionary control and authority to determine the rights and benefits and
all claims, demands and actions arising out of the provisions of the Plan or
any Participant, Beneficiary, deceased Participant, or other person having or
claiming to have any interest under the Plan. 
The Plan Administrator shall have complete discretion to interpret the
Plan and to decide all matters under the Plan. Such interpretation and decision
shall be final, conclusive, and binding on all Participants and any person
claiming under or through any Participant. 
Any individual serving as Plan Administrator who is a Participant will
not vote or act on any matter relating solely to himself or herself.  When making a determination or calculation,
the Plan Administrator shall be entitled to rely on information furnished by a
Participant, a Beneficiary, the Service Recipient, or other party.  The Plan Administrator shall have the responsibility
for complying with any reporting and disclosure requirements of ERISA.

8.6.                            Powers, Duties, Procedures  The Plan Administrator shall have such powers
and duties, may adopt such rules, may act in accordance with such procedures,
may appoint such officers or agents, may delegate such powers and duties, may
receive such reimbursement and compensation, and shall follow such claims and
appeal procedures with respect to the Plan as it may establish.

8.7.                            Information  To
enable the Plan Administrator to perform its functions, the Service Recipient
shall supply full and timely information to the Plan Administrator on all
matters relating to the Compensation of Participants, their employment,
retirement, death, Separation from Service, and such other pertinent facts as
the Plan Administrator may require.

8.8.                            Plan Administration Following a Change in Control Event  Notwithstanding anything to the contrary in
this Article VIII or elsewhere
in the Plan or Trust, upon a Change in Control Event the individual serving as
Chief Executive Officer immediately prior to such Change in Control Event, who
is also a Participant in the Plan or if the Service Recipient has no Chief
Executive Officer who is also a Participant in the Plan, the Service Recipient’s
most senior officer who is also a Participant in the Plan, shall have the right
to appoint an individual, third party, or committee to serve as Plan
Administrator.  Such appointment shall be
made in writing and copies thereof shall be delivered to the Board, to the existing
Plan Administrator, to the Trustee, and to all Plan Participants.  The Trustee and all other service providers
shall be entitled to rely fully on instructions received from the successor
Plan Administrator and shall be indemnified to the fullest extent permitted by
law for acting in accordance with the proper instructions of the successor Plan
Administrator.

 

 23

 

 

ARTICLE
IX

TRUST FUND

9.1.                                 Trust  Coincident
with the establishment of the Plan, the Service Recipient may establish a Trust
for the purpose of accumulating assets which may, but need not be used, by the
Service Recipient to satisfy some or all of its financial obligations to
provide benefits to Participants under this Plan. Any trust created under this Section 9.1 shall be domiciled in the
United States of America, and no assets of the Plan shall be held or
transferred outside the United States. All assets held in the Trust shall
remain the exclusive property of the Service Recipient and shall be available
to pay creditor claims of the Service Recipient in the event of insolvency, to
the extent provided under any Trust established with respect to such Service
Recipient.  The assets held in Trust
shall be administered in accordance with the terms of the separate Trust
Agreement between the Trustee and the Service Recipient.

9.2.                                 Unfunded Plan  In
no event will the assets accumulated by the Service Recipient in the Trust be
construed as creating a funded Plan under the applicable provisions of ERISA or
the Code, or under the provisions of any other applicable statute or
regulation. Any funds set aside by the Service Recipient in Trust shall be
administered in accordance with the terms of the Trust.

9.3.                                 Assignment and Alienation 
No Participant or Beneficiary of a deceased Participant
shall have the right to anticipate, assign, transfer, sell, mortgage, pledge or
hypothecate any benefit under this Plan. 
The Plan Administrator shall not recognize any attempt by a third party
to attach, garnish or levy upon any benefit under the Plan except as may be
required by law.

ARTICLE X

AMENDMENT AND PLAN
TERMINATION

10.1.                                 Amendment  The
Service Recipient shall have the right to amend this Plan without the consent
of any Participant or Beneficiary hereunder, provided that no such amendment
shall have the effect of reducing any of the vested benefits to which a
Participant or Beneficiary has accrued a right as of the effective date of the
amendment.  Notwithstanding the
foregoing, the Service Recipient shall have the right to amend this Plan in any
manner whatsoever without the consent of any Participant or Beneficiary to
comply with the requirements of Code §409A and any binding guidance thereunder
for the deferral of compensation even if such amendment has the affect of
reducing a vested benefit or existing right of a Participant or Beneficiary
hereunder.

 24
 

 

10.2.                          Plan Termination 
The Service Recipient may terminate or discontinue the Plan in whole or
in part at any time as provided for in this Plan or as specified in the
adoption agreement.  Upon Plan
Termination, no further Compensation Deferrals, Discretionary Credits or
Matching Credits shall be made except that the Service Recipient shall be
responsible to pay any benefit attributable to vested amounts credited to the
Participant’s Account as of the effective date of termination (following any
adjustments to such Accounts in accordance with Article III hereof).  If
the Plan is terminated in accordance with this Section 10.2, the Plan
Administrator shall make distribution of the Participant’s vested benefit in a
lump sum cash payment.  A Participant’s
vested benefit shall be adjusted to reflect Investment Credits and Debits for
all Valuation Dates between Plan Termination and the occurrence of a
Participant’s Distributable Event.

10.3.                          Plan
Termination Following a Change in Control Event 
If determined by the Service Recipient in the Adoption
Agreement, a Change in Control Event constitutes a Plan Termination and the
Plan will be terminated.  Upon Plan
Termination Following a Change in Control Event, no further Compensation
Deferrals or Service Recipient Discretionary Credits or Service Recipient Matching
Credits shall be made, and  the Service
Recipient shall be responsible to pay any benefit attributable to vested
amounts credited to the Participant’s Account as of the effective date of
termination  (following any final
adjustments to such Accounts in accordance with Article III hereof).  If
the Plan is terminated in accordance with this Section 10.3, the Plan
Administrator shall make distribution of the Participant’s vested benefit as
soon as possible following such termination.

10.4.                          Effect of Payment 
The full payment of the balance of a Participant’s vested Account under
the provisions of the Plan shall completely discharge all obligations to a
Participant and his designated Beneficiaries under this Plan and each of the
Participant’s Compensation Deferral Agreements shall terminate.

ARTICLE
XI

MISCELLANEOUS

11.1.                          Total Agreement  This
Plan and the executed Adoption Agreement, Compensation Deferral Agreement,
Beneficiary designation and other administration forms shall constitute the
total agreement or contract between the Service Recipient and the Participant
regarding the Plan.  No oral statement
regarding the Plan may be relied upon by the Participant. The Service Recipient
or Plan Administrator shall have the right to 

 25
 

 

                                                       establish such procedures as are
necessary for the administration or operation of the Plan or Trust, and such
procedures shall also be considered a part of the Plan unless clearly contrary
to the express provisions thereof.

11.2.                          Employment Rights 
Neither the establishment of this Plan nor any modification thereof, nor
the creation of any Trust or Account, nor the payment of any benefits, shall be
construed as giving a Participant or other person a right to employment with
the Service Recipient or any other legal or equitable right against the Service
Recipient except as provided in the Plan. 
In no event shall the terms of employment of any Service Provider be
modified or in any way be affected by the Plan.

11.3.                          Non-Assignability 
None of the benefits, payments, proceeds or claims of any Participant or
Beneficiary shall be subject to attachment or garnishment or other legal
process by any creditor of such Participant or Beneficiary, nor shall any
Participant or Beneficiary have the right to alienate, commute, pledge,
encumber or assign any of the benefits or payments or proceeds which he or she
may expect to receive, contingently or otherwise under the Plan.

11.4.                          Binding Agreement 
Any action with respect to the Plan taken by the Plan Administrator or
the Service Recipient or the Trustee or any action authorized by or taken at
the direction of the Plan Administrator, the Service Recipient or other
authorized party shall be conclusive upon all Participants and Beneficiaries
entitled to benefits under the Plan.

11.5.                          Receipt and Release 
Any payment to any Participant or Beneficiary in accordance with the
provisions of the Plan shall, to the extent thereof, be in full satisfaction of
all claims against the Service Recipient, the Plan Administrator and the
Trustee under the Plan, and the Plan Administrator may require such Participant
or Beneficiary, as a condition precedent to such payment, to execute a receipt
and release to such effect.  If any
Participant or Beneficiary is determined by the Plan Administrator to be incompetent
by reason of physical or mental disability (including not being the age of
majority) to give a valid receipt and release, the Plan Administrator may cause
payment or payments becoming due to such person to be made to a legal guardian,
trustee, or other proper representative of the Participant or Beneficiary
without responsibility on the part of the Plan Administrator, the Service
Recipient or the Trustee to follow the application of such funds.

11.6.                          Furnishing Information 
A Participant or his or her Beneficiary will cooperate with the Plan
Administrator or any representative thereof by furnishing any and all
information requested by the Plan Administrator and take such other actions as
may be requested in order to facilitate the administration of the Plan and the
payments of benefits hereunder, including but not limited to taking such
physical examinations as the Plan Administrator may deem necessary.

 26
 

 

11.7.                          Insurance  The
Service Recipients, on their own behalf or on behalf of the trustee of the
Trust, and, in their sole discretion, may apply for and procure insurance on
the life of the Participant, in such amounts and in such forms as they may
choose.  The Service Recipients or the
trustee of the Trust, as the case may be, shall be the sole owner and
beneficiary of any such insurance.  The
Participant shall have no interest whatsoever in any such policy or policies,
and at the request of the Service Recipients shall submit to medical
examinations and supply such information and execute such documents as may be
required by the insurance company or companies to which the Service Recipients
have applied for insurance.

11.8.                          Governing Law 
Construction, validity and administration of this Plan shall be governed
by applicable Federal law and under the laws of the State of Georgia.  If any provision shall be held by a court of
competent jurisdiction to be invalid or unenforceable, the remaining provisions
hereof shall continue to be fully effective.

11.9.                          Headings and Subheadings 
Headings and subheadings in this Plan are inserted for convenience only
and are not to be considered in the interpretation of the provisions hereof.

 

 27

 

 

NONQUALIFIED DEFERRED COMPENSATION PLAN

ADOPTION AGREEMENT

The Service
Recipient named below hereby establishes a Nonqualified Deferred Compensation
Plan for Eligible Service Providers as provided in this Adoption Agreement and
the Basic Plan Document.

I               Service Recipient Information

(a)           Name and Address
of Service Recipient sponsoring the Plan:

SI International,
Inc.                                                                            

12012 Sunset Hills Road,
Suite
800                                                   

Reston, VA 
20190-5869                                                                      

(b)                                 Telephone Number                      7 0 3 – 2 3 4 – 7 0 0 3

(c)                                  Tax ID Number:                            5 2 –  2 1 2 7 2
7 8

(d)                                 Name
of Plan:                                SI
International Deferred Compensation Plan

(e)                                  Tax
Year End:                                12/31                                                                                               

II             Definitions

(a)                                  Compensation:  Compensation under the Plan is defined as (select one or more):

(i)                                     x           Regular Salary: The Participant’s
gross income paid by the Service Recipient during the Taxable Year as
reportable on Internal Revenue Service Form W-2, including amounts excludible
from gross income which are contributed by the Participant on a pre-tax basis
to a salary reduction retirement or welfare plan (including amounts contributed
to this Plan), but excluding Commissions, Bonus, Director Fees, or other
amounts not part of his or her Regular Salary.

(ii)                                  x           Bonus.

(iii)                               x           Performance Based Compensation:
Income where the payment or the amount is contingent on the satisfaction of
organizational or individual performance criteria, and the performance criteria
are not substantially certain to be met at the time a deferral election is
permitted.  Performance Based
Compensation must be based on services performed over a period of at least 12
months where the Compensation Deferral Agreement to defer such compensation is
to be made no later than 6 months before the end of the service period.

Performance Based Compensation may include payments
based upon subjective performance criteria, but:

(1)          any subjective
performance criteria must relate to the performance of the Service Provider, a
group of Service Providers that includes the Participant, or a business unit
for which the Participant provides services (which may include the entire
organization); and

 1
 

 

(2)          the determination that
any subjective performance criteria have been met must not be made by the
Participant or a family member of the Participant (as defined in IRC §
267(c)(4) applied as if the family of an individual includes the Spouse of any
member of the family).

Performance Based Compensation may also include
payments based on performance criteria that are not approved by a compensation
committee of the Board or by the stockholders or members of the Service
Recipient. Notwithstanding the foregoing, Performance Based Compensation does not
include any amount or portion of any amount that will be paid either regardless
of performance, or based upon a level of performance that is substantially
certain to be met at the time the criteria is established, or that is based
solely on the value of, or appreciation in value of, the Service Recipient or
the stock of the Service Recipient.

(iv)                              x           Commissions.

(v)                                 x           Director Fees.

(b)                                 De
minimis Distributions (select one):

(i)                                     x           The Service Recipient shall not have
the right to make De minimis Distributions.

(ii)                                  o            The Service Recipient shall have the
right to make De minimis Distributions, and, notwithstanding the Participant’s
election regarding the Separation from Service Payment, the Service Recipient
shall have the right to pay the Participant’s benefit in a single lump sum
payment, provided that:

(1)          the payment accompanies
the termination of the entirety of the Participant’s interest in the Plan

(2)          the payment is made on
or before the later of the last day of the Taxable Year in which Participant’s
Separation from Service occurred or within two-and-one-half (21⁄2) months after
the Participant’s Separation from Service from the Service Recipient.

(3)          The payment is not
greater than $10,000.

(c)                                  Effective
Date (select one):

(i)                                     o            This is a new Plan and the Effective
Date will be _________________________.

(ii)                                  x           This is an amended and/or restated
Plan. The Plan was previously amended and restated effective as of January 1,
2005, for amounts deferred after December 31, 2004 within the meaning of
Section 409A of the Code.  Amounts
deferred prior to January 1, 2005, and eligible for grandfathering under
Section 5.2 of the basic plan, shall be administered under the Plan as in
effect prior to January 1, 2005 amendment and restatement.  The provisions of the Plan pursuant to this
amendment and restatement shall be effective as of January 1, 2007.

(d)                                   Compensation
Earned During Final Payroll

x                             Compensation that is
attributable to services performed during the final payroll period of a service
provider’s taxable year, and payable in the subsequent taxable year, will be
treated as compensation earned in that subsequent taxable year for purposes of
applying the deferral election timing rules of IRC §409A. (If this
section is not elected, then such compensation will be treated as compensation
for the year in which it was earned.)

 2
 

 

III                                    Eligibility

The Plan is intended to be “a plan which is unfunded
and is maintained by an employer primarily for the purpose of providing
deferred compensation for a select group of management or highly compensated
employees” within the meaning of §§201(2) and 301(a)(3) of the Employee
Retirement Income Security Act of 1974 (“ERISA”). The Service Recipient
adopting this Plan should consult with counsel regarding eligibility under the “select
group” standard.

An individual shall be an Eligible Service Provider as
follows (select one or more):

(a)                                  x           If he or she is designated as an
Eligible Service Provider by resolution of the Board of the Service                    Recipient.

(b)                                 x           If he or she is designated, in
writing, as an Eligible Service Provider by the Chief Executive Officer,
provided that the Plan continues to constitute a plan for a select group of
management or highly compensated employees. 
The Chief Executive Officer will not vote or act on any matter regarding
eligibility that relates solely to himself or herself.

(c)                                  x           If he or she occupies one of the
following positions: 

Director or above.

(d)                                 o            If his or her Compensation for a
Taxable Year is expected to be greater than $____________________.

(e)                                  o            If he or she is an Eligible Service
Provider, as defined in III (a), (b) (c) or (d) above, of an Additional
Adopting Service Recipient as listed on Exhibit A attached to this Adoption
Agreement and is otherwise defined as an Eligible Service Provider under the
Plan.

IV            Compensation Deferrals (select one or more):

(a)                                  o            A Participant’s Compensation
Deferrals with respect to a Taxable Year shall be limited to a minimum of (select one or more):

(i)                                     o            _______________% of a
Participant’s Regular Salary

(ii)                                  o            _______________% of a
Participant’s Bonus

(iii)                               o            _______________% of a Participant’s
Performance Based Compensation

(iv)                              o            _______________% of a
Participant’s Commissions

(v)                                 o            _______________% of a
Participant’s Director Fees

(b)                                                 A Participant’s Compensation
Deferrals with respect to a Taxable Year shall be limited to a maximum of (select one or more):

	
  

  	
   

  	
  (i)

  	
   

  	
  x

  	
  100

  	
  % of a Participant’s Regular Salary

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
   

  	
  x

  	
  100

  	
  % of a Participant’s Bonus

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iii)

  	
   

  	
  x

  	
  100

  	
  % of a Participant’s Performance Based Compensation

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iv)

  	
   

  	
  x

  	
  100

  	
  % of a Participant’s Commissions

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (v)

  	
   

  	
  x

  	
  100

  	
  % of a Participant’s Director Fees

  

 

(c)                                                  A Participant’s Compensation
Deferrals with respect to a Taxable Year shall be limited to a minimum of (select one or more):

(i)                                     o            $_______________ of a
Participant’s Regular Salary

(ii)                                  o            $_______________ of a
Participant’s Bonus

 3
 

 

(iii)                               o            $_______________ of a
Participant’s Performance Based Compensation

(iv)                              o            $_______________ of a Participant’s
Commissions

(v)                                 o            $_______________ of a
Participant’s Director Fees

(d)                                                 A Participant’s Compensation Deferrals with
respect to a Taxable Year shall be limited to a maximum of (select one or more):

(i)                                     o            $_______________ of a
Participant’s Regular Salary

(ii)                                  o            $_______________ of a
Participant’s Bonus

(iii)                               o            $_______________ of a
Participant’s Performance Based Compensation

(iv)                              o            $_______________ of a
Participant’s Commissions

(v)                                 o            $_______________ of a
Participant’s Director Fees

To make a Compensation
Deferral for a Taxable Year, a Participant shall have made the maximum per-tax
deferral permitted under the Employer’s tax qualified plan.

V             Matching Credits

(a)                                  Matching
Credits shall be determined in accordance with one or more of the following
methods (select one or more):

(i)                                     o            The Service Recipient shall credit
to the Account of each Participant __________% of such Participant’s
Compensation Deferrals.  Matching Credits
shall be made based on Compensation Deferrals made each (select one):

(1)                                  o            pay period

(2)                                  o            Taxable Year

(3)                                  o            Other (specify):

________________________________

(ii)                                  o            The Service Recipient shall credit
to the Account of each Participant __________% of the first __________% of such
Participant’s Compensation Deferrals, plus __________% of the next __________%
of such Participant’s Compensation Deferrals, plus _________% of the next
__________% of such Participant’s Compensation Deferrals.  Matching Credits shall be made based on
Compensation Deferrals made each (select one):

(1)                                  o            Pay period

(2)                                  o            Taxable Year

(3)                                  o            Other (specify):

________________________________

(iii)                               x           An amount determined and made at a
time in the discretion of the Service Recipient.

(b)                                 Limitations
on Matching Credits (select one or more):

(i)                                     o            The Matching Credit shall not exceed
$_______________ for any Participant.

(ii)                                  o            The Service Recipient shall not
provide a Matching Credit for any Compensation Deferral in excess of
__________% of the Participant’s Compensation.

(c)                                  Eligibility
for Matching Credit (select one or more):

(i)                                     o            All Participants who have completed
at least __________ hours of employment during the Taxable Year.

(ii)                                  o            All Participants employed on the
last day of a Taxable Year.

 4
 

 

(iii)                               o            All Participants who satisfy the
following conditions:

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

(iv)                              x           No eligibility conditions.  All Participants who make Compensation
Deferrals are eligible for Matching Credits.

VI                                   Discretionary
Credits

(a)           Amount
of Discretionary Credit (select one or more):

(i)                                     x           An amount determined at the
discretion of the Service Recipient, which need not be uniform as to
Participants.

(ii)                                  o            An amount determined by the
following formula:

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

(b)           Eligibility
for Discretionary Credit (select one or more):

(i)                                     o            All Participants who have completed
at least __________ hours of employment during the Taxable Year.

(ii)                                  o            All Participants employed on the
last day of a Taxable Year.

(iii)                               o            All Participants who satisfy the
following conditions:

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

________________________________________________________________________

(iv)                              x           No eligibility conditions.  All Participants who are Eligible Service
Providers of the Service Recipient during the Taxable Year are eligible for
Discretionary Credits.

VII                               Changing
the Form and Timing of Installment Distributions

x                     Participants
are not permitted to subsequently elect a change in the timing or the form of
the Separation from Service Payment for any Taxable Year.

o                        Participants
may be permitted to subsequently elect a change in the timing or the form of
the Separation from Service Payment, as previously selected, by submitting the
appropriate form to the Plan Administrator, provided (select one):

(1)        o                                              Single
Stream Payments. All the installments are treated as a single payment
whereby the 5 year extension is determined by the first scheduled payment.

(2)       o                                                 Separate Payment Stream.  To
the extent that each installment is a separately identifiable and objectively
determinable amount that a participant is entitled to receive under a plan on a
determinable date, each installment is treated as a separate payment whereby
the 5 year extension is determined independently for each payment.

 5
 

 

VIII         Vesting and Forfeitures (select one or more):

(a)                                  o            A Participant’s entire Account shall
be 100% vested at all times.

(b)                                 o            A Participant’s vesting schedule can
be accelerated at the discretion of the Plan Administrator if such a change in
vesting schedule is in writing.  The Plan
Administrator will not vote or act on any matter regarding Vesting and Forfeitures
that relates solely to himself or herself.

(c)                                  x           The Participant shall at all times be
one hundred percent (100%) vested in his or her Compensation Deferrals, as well
as in any hypothetical appreciation (or depreciation) specifically attributable
to such Compensation Deferrals due to Investment Credits and Debits.  The Participant shall vest in Matching
Credits and/or Discretionary Credits, as well as in any hypothetical
appreciation (or depreciation) specifically attributable to such amounts due to
Investment Credits and Debits, pursuant to the vesting schedule shown below (select one).

(i)                                     o            Service Year Vesting

	
  

  	
   

  	
  Years of Service

  	
   

  	
  Vesting
  Percentage

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  

 

For purposes of the
above schedule, a Participant shall earn a Year of Service as follows:

______________________________________________________________

______________________________________________________________

______________________________________________________________

______________________________________________________________

(ii)                                  x           Class Year Vesting

	
     

  	
   

  	
  Class Years

  	
   

  	
  Vesting
  Percentage

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
  0-3

  	
   

  	
  0

  	
  %

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
  3 and above

  	
   

  	
  100

  	
  %

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
     

  	
   

  	
   

  	
   

  	
   

  	
  %

  	
   

  	
   

  

 

The vesting schedule
described above shall apply separately with respect to any amounts credited to
a Participant’s Account during a given Taxable Year.

For purposes of the
above schedule, a Participant shall earn a Class Year on each one-year
anniversary of the end of the Taxable Year with respect to which the credits
relate.  For example, credits
attributable to the Taxable Year ending 2005 will vest one Class Year for the
applicable amount on December 31, 2006.

 6
 

 

 (d)                              x           A Participant’s entire Account shall
become 100% vested upon (select one or more):

(i)                                     x           The Participant’s death

(ii)                                  x           The Participant’s Disability

(iii)                               x           The Participant’s attainment of age   60  

(iv)                              x           A Change in Control

(v)                                 o            A Conflict of Interest Divestiture

(vi)                              o            The Participant’s involuntary
Separation from Service Without Good Cause by the Service Recipient.

(e)                                  o            A Participant who is otherwise vested in accordance with this Section VII
shall nevertheless forfeit his or her vested Account other than
Compensation Deferrals, as well as in
any hypothetical appreciation (or depreciation) specifically attributable to
such Compensation Deferrals due to Investment Credits and Debits under the
following circumstances (please specify):

______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________

(f)                                    o            Any forfeitures under the Plan shall
be credited to the Account of each Participant other than the Participant whose
Account generated the forfeiture in the same proportion that each such
Participant’s Account as of the end of the Taxable Year in which the forfeiture
occurred bears to the Accounts of all such Participants as of the same date.

IX            Change in Control and Change in
Control Event

(a)                                  x           For purposes of Section 1.6 of the
Basic Plan Document and Section VIII(d) of this Adoption Agreement, Change in
Control shall mean the earliest to occur of the following :

(i)                                     The
consummation of any transaction or series of transactions as a result of which
any “Person” (as the term person is used for purposes of Section 13(d) or 14(d)
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) other
than an “Excluded Person” (as hereinafter defined) has or obtains ownership or
control, directly or indirectly, of fifty percent (50%) or more of the combined
voting power of all securities of the Employer or any successor or surviving
corporation of any merger, consolidation or reorganization involving the
Employer (the “Voting Securities”).  The
term “Excluded Person” means any one or more of the following:  (i) the Employer or any majority-owned
subsidiary of the Employer, (ii) an employee benefit plan (or a trust forming a
part thereof) maintained by (A) the Employer or (B) any majority-owned subsidiary
of the Employer, (iii) any Person who as of the Effective Date of this Plan
owned or controlled, directly or indirectly, ten percent (10%) or more of the
then outstanding Voting Securities, or any individual, entity or group that was
part of such a Person;

(ii)                                  A
merger, consolidation or reorganization involving the Employer as a result of
which the holders of Voting Securities immediately before such merger,
consolidation or reorganization do not immediately following such merger,
consolidation or reorganization own or control, directly or indirectly, at
least fifty percent (50%) of the Voting Securities in substantially the same
proportion as their ownership or control of the Voting Securities immediately
before such merger, consolidation or reorganization;

 7
 

 

(iii)                               The
sale or other disposition of all or substantially all of the assets of the
Employer to any Person (other than a transfer to a majority-owned subsidiary of
the Employer); or

(iv)                              during
any period of two consecutive years or less, individuals who at the beginning
of such period constitute the Board of Directors of the Employer cease, for any
reason, to constitute at least a majority of the Board of Directors, unless the
election or nomination for election of each person who was not a director at
the beginning of such period was approved by vote of at least two-thirds of the
directors then in office who were directors at the beginning of such period or
who were directors previously so approved.

(b)                                 o            Change
of Control shall mean:

___________________________________________________

___________________________________________________

__________________________________________________

(c)                                  The
occurrence of a Change in Control Event shall (select
one):

(i)                                     o            not, under any circumstances,
including the discretion of the Service Recipient, constitute a Plan
Termination Following a Change in Control Event.

(ii)                                  o            constitute a Plan Termination
Following a Change in Control Event.

(iii)                               x           may constitute a Plan Termination
following a Change in Control Event, at the discretion of the Service
Recipient, within 12 months of a Change in Control Event.

(iv)                              x           shall constitute a Distributable
Event within the meaning of 1.13 of the Basic Plan Document.

X.                                    Plan
Terminations  In addition to the
option elected pursuant to a Change in Control Event, above, the Service
Recipient may terminate the Plan (select one or more)
:

o                                    Following a
Corporate Dissolution or with the approval of a Bankruptcy Court.

x                                  Following termination
of all arrangements of the same type as the Deferral Agreement

XI.           Distributions
(select one or more).

x           Within 12 months after a Plan
Termination following a Change in Control Event.

o                                    Within 12 months
after a Plan Termination following a Corporate Dissolution or with the approval
of a Bankruptcy Court.

x                                  After a Plan
Termination following termination of all arrangements of the same type as the
Deferral Agreement. (1) all plans of
the same type must be terminated with respect to all participants, (2) no
payments (other than ordinary course payments that would have been made had the
plan not terminated) may be made within 12 months of the plan termination, (3)
all payments are to be made within 24 months of the plan termination, and (4)
no new similar plan may be adopted for five years.

 8
 

 

 

  XII.         Delay in Distributions (select
one or more).

x                                  Payments subject to
Code §162(m).  A payment may be delayed
where the Service Recipient reasonably anticipates that a deduction with
respect to the payment will be limited/eliminated by application of Code
§162(m). In such an event, the payment will be made either at the earliest date
at which the Service Recipient reasonably anticipates the deduction would not
be limited/eliminated or the calendar year in which the Service Provider
separates from service. In the event this provision is subsequently removed
from the Plan, it must be effective only with respect to amounts deferred after
the Plan is amended to remove the provision.

x                                  Payments that violate
a loan covenant or similar contractual requirement.  A payment may be delayed if such payment would
violate a loan covenant or other contractual requirement. In such an event,
payment will be made in the first calendar year in which the employer
reasonably anticipates that the payment would not violate such loan covenant or
contractual requirement.

x                                  Payments that would
violate Federal Securities law or other applicable law.  In such an event, payment will be made in the
first calendar year in which the employer reasonably anticipates that the
payment would not result in a violation of Federal Securities law or other
applicable law.

XIII.      Signatures

This Nonqualified Deferred Compensation Plan,
including this Adoption Agreement, has been designed to permit Participants to
defer Federal and state income tax on amounts credited to their Accounts until a
later Taxable Year.  The Service
Recipient adopting this Plan should consult with tax counsel regarding the
consequences of adopting this Plan to both the Service Recipient and Service
Providers and the effect an amendment or restatement of an existing plan using
this Plan Document may have, if any, under Code §409A on previously deferred
amounts.  Registration of interests under
this Nonqualified Deferred Compensation Plan may be required under securities
law.  Independent legal counsel should be
consulted with respect to securities law issues.  By executing this Adoption Agreement, the
Service Recipient acknowledges that no representations or warranties as to the
tax or securities law consequences to the Service Recipient and Participants of
the operation of this Plan have been made by the entity who has provided this
Plan document and Adoption Agreement.

The Plan and this accompanying Adoption Agreement were
adopted by the Service Recipient the ___ day of
December, 2006.

	
  Executed for the Service
  Recipient by:

  	
   

  	
  Thomas E. Dunn

  
	
   

  	
   

  	
   

  
	
  Title of Individual:

  	
   

  	
  EVP, Chief Financial Officer and Treasurer

  
	
   

  	
   

  	
   

  
	
  Signature:

  	
   

  	
  /s/ THOMAS E. DUNN

  

 9
 

 

EXHIBIT A

ADDITIONAL
ADOPTING SERVICE RECIPIENTS

In accordance with paragraph 1.26 of the Basic
Plan Document, the Service Recipient has consented to allow the following
entities to participate in the Plan:

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

 

 10Exhibit
10.10

Analytical
Surveys, Inc.

Incentive and Reward Program (IRP)

For Fiscal 2006 and 2007

ASI’s Incentive and Reward Program (IRP) is designed to provide
significant reward and incentive to executive management. Although many factors
will determine the success of the company, one of the most critical factors is
aligning the goals of executive management with the goals of the corporation.
ASI’s IRP is designed to motivate superior performance from the key
people who impact profitability of the company. Ultimately, the program is
intended to improve the organization’s earnings and cash flow, and assist in
attracting and retaining the best managerial talent.

IRP
Overview

The Incentive and Reward
Program is made up of three basic components:

Annual Revenue Goals

Quarterly Revenue and Profitability Goals

Non-participating
interest in oil and gas investments

Annual Revenue Goal

Prior to the beginning of
each new fiscal year, an annual revenue goal will be determined. The first step
in this determination process will be a meeting of executive management to
review proposed opportunities and forecast the market potential for the coming
year. The outcome of this process will be an annualized revenue goal that will
then be presented to ASI’s Board of Directors for review, feedback, and
approval.

Quarterly Revenue and Profitability Goal

Once the annual revenue
goal has been established, the executive management team will evaluate the
makeup of the revenue projections by quarter and forecast quarterly revenue and
profitability goals. These quarterly goals now become the basis for the
Incentive and Reward Program. Profitability measures are based upon earnings
before interest and taxes (EBIT).

Overriding Royalty Interests

As ASI evolves its
business into the energy sector, it is critical that management focus on oil
and gas investments that generate sufficient revenue and profitability to
satisfy the goals of the organization, and also provide upside potential. As
such, the company will set aside an overriding royalty interest equal to 2% of
the net revenue interest in each oil and gas interest, which is purchased or
otherwise acquired by ASI. This interest will be assigned as an overriding
royalty interest to the primary members of the Executive Management Team

 

 1
 

 

Incentive Rewards

 

Incentive Rewards are
dollars that are accrued on a quarterly basis with the amount of accrual based
upon the success of the Executive Management team and the company. The Cash
Incentive Reward funds are divided into the following categories:

·                  Primary IRP Funds (Members of the Executive Management Team)
– Each participant within this category will be equally qualified for
distribution of Executive Reward dollars. The distribution for this category is
approximately 80% of the Incentive and Reward pool for each quarter.

·                  Discretionary IRP Funds – A portion of the Incentive Reward
dollars are reserved for discretionary distribution. The purpose of the
discretionary fund is to award individuals for an outstanding contribution to
the success of the quarter. The discretionary funds may be used as an
additional award to member(s) of the Executive Management Team or as an award
to individual(s) outside of the Management Team that contributed to the
quarter. The total discretionary fund is targeted to be approximately 20% of
the Incentive and Reward pool for each quarter.

Cash Incentive Rewards

Although the value
of the Incentive and Reward Pool is formula driven, ASI’s Executive Management
Team will review quarterly results and recommend the size of the Incentive and
Reward pool for each quarter. In determining the size of the pool, two major
factors will be taken into account; the amount of revenue and profitability
(earnings before interest and taxes — EBIT) during the quarter as compared to
the goal, and the overall financial condition of the company. Once the
Executive Management Team has determined what they believe is appropriate, the
recommendation will be presented to the Board of Directors for review, feedback
and approval.

Cash Incentive Rewards
will be awarded on a quarterly basis. Incentive Rewards are deemed earned upon
the accounting close of the completed quarter and will be paid within ten (10)
days following the approval of the Board of Directors.

Overriding Royalty Interest Incentive Rewards

The company will assign overriding royalty interests
to the individual participants of the Management Team on a deal by deal basis.
The assignments will be executed and filed within ten (10) days following the
approval of the assignment by the Board of Directors.

 

 2
 

 

Incentive and Reward Program Targets for Fiscal Year 2006

 

	
  Total Revenue Goal for Q4 -
  FY 2006:

  	
   

  	
   

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fiscal Year 2006

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Q4-

  	
  Jul, Aug, Sep

  	
  2006 

  	
   

  	
  Revenue

  	
   

  	
  $

  	
  1,000,000

  	
   

  
	
   

  	
   

  	
  EBIT

  	
   

  	
  $

  	
  -0-

  	
   

  
									

 

Incentive and Reward Program Targets for Fiscal Year 2007

 

	
  Total Revenue Goal for - FY
  2007

  	
   

  	
   

  	
   

  	
  $

  	
  3,800,000

  	
   

  
	
  EBIT Goal for - FY 2007

  	
   

  	
   

  	
   

  	
  $

  	
  400,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fiscal Year 2007

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Q1 -

  	
  Oct, Nov, Dec

  	
  2006

  	
   

  	
  Revenue

  	
   

  	
  $

  	
  200,000

  	
   

  
	
   

  	
   

  	
  EBIT

  	
   

  	
  $

  	
  (200,000

  	
  )

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Q2 -

  	
  Jan, Feb, Mar,

  	
  2007

  	
   

  	
  Revenue

  	
   

  	
  $

  	
  600,000

  	
   

  
	
   

  	
   

  	
  EBIT

  	
   

  	
  $

  	
  -0-

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Q3 -

  	
  Apr, May, Jun

  	
  2007

  	
   

  	
  Revenue

  	
   

  	
  $

  	
  1,200,000

  	
   

  
	
   

  	
   

  	
  EBIT

  	
   

  	
  $

  	
  200,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Q4 -

  	
  Jul, Aug, Sep

  	
  2007

  	
   

  	
  Revenue

  	
   

  	
  $

  	
  1,800,000

  	
   

  
	
   

  	
   

  	
  EBIT

  	
   

  	
  $

  	
  400,000

  	
   

  
													

 

Incentive and
Reward Program Formulas

The basis for the
recommendation to the Board of Directors for payout of Incentive rewards is:

Cash Incentive Rewards – ASI cash incentive rewards are based upon 5% of earnings
before interest and taxes (EBIT).

Overriding
Royalty Interest Incentive Rewards – 2% of ASI Energy’s net revenue interest in oil and gas
investments.  For example, if ASI Energy
enters into an investment that has a 10% net revenue interest, 2% of that 10%,
or 2/10ths of one percent is available for the
non-participating incentive pool.  The 2%
pool is to be distributed between two executive officers; the pool may be
increased by 1% for an additional executive officer.

General Policies

The goal of the Incentive
and Reward Program is to allow for full management of the business while
providing an incentive to the people that are responsible for ASI’s success.

The following are the general policies of the program:

 

 3
 

 

·                  The
program outlined herein will expire at the end of ASI’s 2008 fiscal year, which
occurs on September 30, 2008. Prior to that date, Executive Management will
review the plan and evaluate its validity based upon the status of the company
at that time. Based upon that evaluation, a recommendation for an extension of
the current plan or a modified Reward and Incentive Plan will be submitted to
the Board of Directors for review, feedback and approval.

·                  The
program outlined here in no way represents guaranteed bonus or entitlement for
anyone. The program and its measures can be changed at any time at the sole
discretion of ASI executive management. In the event of program change,
payments and assignments that have been previously approved will be “grandfathered”
payable in accordance with the original plan.

·                  Under
the Incentive and Reward Program, funds are not considered “earned” until the
scheduled payout date. Therefore, any individual who resigns or is terminated
for cause is due only the funds that have been earned by the date of
termination of employment.

·                  In
the event of termination of employment, Participant will deliver to employer
all hardware, software, memoranda, notes, plans, records, reports, and other
documents and information provided to Participant by Employer or created by
Participant in connection with Participant’s employment responsibilities, and
all copies of all such documents in any tangible form which Participant may
then possess or have under Participant’s control, and will destroy all of such
information in intangible form which is in Participant’s possession or under
Participant’s control.

·                  Eligible
participants shall not pay, offer to pay, assign or give any part of his/her
Incentive Reward or any other money or consideration to any agent, customer or
representative of the customer or any other person as an inducement or reward
for assistance in making a sale. This provision does not prohibit participants
from engaging in normal business entertainment activities with
customers/prospective customers or their agents or representatives, or giving
business gifts of nominal value to customers/prospective customers or their
agents or representatives.

·                  This
program replaces any previously existing ASI programs.

 4

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