Document:

Exhibit 4.7

 

COMPUTER
ASSOCIATES INTERNATIONAL INC.

 

Computer
Associates Savings Harvest Plan

 

(“CASH Plan”)

 

[As Amended
and Restated

Effective March 31, 1997]

 

 

[Incorporating
All Amendments Adopted Through February 1, 2000]

 

 

TABLE OF
CONTENTS

 

	
  ARTICLE I

  
	
  GENERAL
  DEFINITIONS

  
	
   

  
	
  1.1

  	
  Beneficiary

  	
   

  
	
  1.2

  	
  Code

  	
   

  
	
  1.3

  	
  Committee

  	
   

  
	
  1.4

  	
  Compensation

  	
   

  
	
  1.5

  	
  Disability

  	
   

  
	
  1.6

  	
  Effective Date

  	
   

  
	
  1.7

  	
  Employee

  	
   

  
	
  1.8

  	
  Employer

  	
   

  
	
  1.9

  	
  Employer Contributions

  	
   

  
	
  1.10

  	
  Employer Discretionary Contributions

  	
   

  
	
  1.11

  	
  Employer Matching Contributions

  	
   

  
	
  1.12

  	
  ERISA

  	
   

  
	
  1.13

  	
  Highly Compensated Employee

  	
   

  
	
  1.14

  	
  Hour of Service

  	
   

  
	
  1.15

  	
  Normal Retirement Age

  	
   

  
	
  1.16

  	
  One Year Break-in-Service

  	
   

  
	
  1.17

  	
  Participant

  	
   

  
	
  1.18

  	
  Period of Separation

  	
   

  
	
  1.19

  	
  Period of Service

  	
   

  
	
  1.20

  	
  Period of Severance

  	
   

  
	
  1.21

  	
  Plan

  	
   

  
	
  1.22

  	
  Plan Year

  	
   

  
	
  1.23

  	
  Pre-Tax Contributions

  	
   

  
	
  1.24

  	
  Qualified Military Service

  	
   

  
	
  1.25

  	
  Re-Employed Individual

  	
   

  
	
  1.26

  	
  Related Company

  	
   

  
	
  1.27

  	
  Rollover Contributions

  	
   

  
	
  1.28

  	
  Salary Reduction Agreement

  	
   

  
	
  1.29

  	
  Trust

  	
   

  
	
  1.30

  	
  Trustee

  	
   

  
	
  1.31

  	
  USERRA

  	
   

  
	
  1.32

  	
  Valuation Date

  	
   

  
	
  1.33

  	
  Voluntary Contributions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
  OBJECTIVE OF
  THE PLAN

  
	
   

  
	
  2.1

  	
   

  	
   

  
	
  2.2

  	
   

  	
   

  

 

ii

 

	
  ARTICLE III

  
	
  PARTICIPATION

  
	
   

  
	
  3.1

  	
  Eligibility

  	
   

  
	
  3.2

  	
  Date of Participation

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
  CONTRIBUTIONS TO THE PLAN

  
	
   

  
	
  4.1

  	
  Pre-Tax Contributions

  	
   

  
	
  4.2

  	
  Salary Reduction Agreements

  	
   

  
	
  4.3

  	
  Amendment and Revocation of Salary
  Reduction Agreements

  	
   

  
	
  4.4

  	
  Employer Matching Contributions

  	
   

  
	
  4.5

  	
  Employer Discretionary Contributions

  	
   

  
	
  4.6

  	
  Allocation of Employer Discretionary
  Contributions

  	
   

  
	
  4.7

  	
  Voluntary Contributions

  	
   

  
	
  4.8

  	
  Make-Up Contributions

  	
   

  
	
  4.9

  	
  Form, Payment and Timing of Contributions
  to the Trust

  	
   

  
	
  4.10

  	
  Non-Discrimination
  Tests

  	
   

  
	
  4.11(a)

  	
  Limitations
  on Annual Additions

  	
   

  
	
  4.11(b)

  	
  Removal of Excess Contributions

  	
   

  
	
  4.11(c)

  	
  Definitions

  	
   

  
	
  4.12

  	
  Rollover
  Contributions

  	
   

  
	
  4.13

  	
  Rollover/Transfer
  Procedures

  	
   

  
	
  4.14

  	
  Transfer
  to Other Qualified Plans

  	
   

  
	
  4.15

  	
  Special
  Rules Relating to Qualified Military Service

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V

  
	
  PARTICIPANTS’ ACCOUNTS

  
	
   

  
	
  5.1

  	
  Separate Accounts

  	
   

  
	
  5.2

  	
  Allocation of Contributions

  	
   

  
	
  5.3

  	
  Allocation of Net Income or Net Loss

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
  VESTING

  
	
   

  
	
  §6.1

  	
  Vesting of Pre-Tax, Voluntary and Rollover
  Contribution Accounts

  	
   

  
	
  §6.2

  	
  Vesting of Employer Matching and
  Discretionary Contribution Accounts

  	
   

  
	
  §6.3

  	
  Years of Service

  	
   

  
	
  §6.4

  	
  Forfeitures

  	
   

  

 

iii

 

	
  ARTICLE VII

  
	
  DISPOSITION OF VESTED INTERESTS IN ACCOUNTS

  
	
   

  
	
  7.1

  	
  Disposition at Termination of Employment

  	
   

  
	
  7.2

  	
  Methods of Distribution

  	
   

  
	
  7.3

  	
  Timing of Distributions

  	
   

  
	
  7.4

  	
  Disposition Upon Death

  	
   

  
	
  7.5

  	
  Designation of Beneficiary

  	
   

  
	
  7.6

  	
  Notification

  	
   

  
	
  7.7

  	
  Required and Minimum Distribution Rules

  	
   

  
	
  7.8

  	
  Required Distributions of Death Benefits

  	
   

  
	
  7.9

  	
  Valuation of Distributions

  	
   

  
	
  7.10

  	
  Direct
  Rollover of Eligible Rollover Distributions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  
	
  IN-SERVICE WITHDRAWALS AND LOANS

  
	
   

  
	
  8.1

  	
  Withdrawals from Participants’ Accounts

  	
   

  
	
  8.2

  	
  Loans to Participants

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX

  
	
  MISCELLANEOUS PROVISIONS

  
	
   

  
	
  9.1

  	
  Termination

  	
   

  
	
  9.2

  	
  Merger or Consolidation

  	
   

  
	
  9.3

  	
  Alienation Prohibited

  	
   

  
	
  9.4

  	
  Governing Law

  	
   

  
	
  9.5

  	
  Plan
  Not Contract of Employment

  	
   

  
	
  9.6

  	
  Reversion
  of Certain Contributions

  	
   

  
	
  9.6(a)

  	
  Disallowance of Deduction

  	
   

  
	
  9.6(b)

  	
  Mistake of Fact

  	
   

  
	
  9.7

  	
  Participant
  or Beneficiary Unable to be Found

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X

  
	
  ADMINISTRATIVE PROVISIONS

  
	
   

  
	
  10.1(a)

  	
  Committee

  	
   

  
	
  10.1(b)

  	
  Quorum; Majority to Govern

  	
   

  
	
  10.1(c)

  	
  Act of Committee

  	
   

  
	
  10.1(d)

  	
  By-Laws

  	
   

  
	
  10.1(e)

  	
  Powers and Duties of Committee

  	
   

  
	
  10.1(f)

  	
  Advisers

  	
   

  
	
  10.1(g)

  	
  Allocation of Fiduciary Responsibilities

  	
   

  
	
  10.1(h)

  	
  Investment Manager

  	
   

  
	
  10.1(i)

  	
  Claims Procedure

  	
   

  
	
  10.1(j)

  	
  Indemnification

  	
   

  
	
  10.1(k)

  	
  Transmission of Notices, Forms and Consents
  Through Electronic Media

  	
   

  

 

iv

 

	
  10.2

  	
  Employer

  	
   

  
	
  10.2(a)

  	
  Contributions

  	
   

  
	
  10.2(b)

  	
  Appointment Removal and Compensation of
  Trustee

  	
   

  
	
  10.2(c)

  	
  Expenses

  	
   

  
	
  10.2(d)

  	
  Amendment of Plan

  	
   

  
	
  10.3

  	
  Service
  in More Than One Capacity

  	
   

  
	
  10.4

  	
  Payments
  to the Trust and Establishment of Investment Funds

  	
   

  
	
  10.5

  	
  Payments
  From the Trust

  	
   

  
	
  10.6

  	
  Voting
  Rights with Respect to Company Stock Fund

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XI

  
	
  INVESTMENT DIRECTIONS

  
	
   

  
	
  11.1

  	
  Directed
  Investments

  	
   

  
	
  11.2

  	
  Allocation
  of Employer Discretionary Contributions Made in Computer Associates
  International, Inc. Stock

  	
   

  
	
  11.3

  	
  Application
  of Securities Law

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XII

  
	
  SPECIAL TOP-HEAVY PROVISIONS

  
	
   

  
	
  12.1

  	
  Purpose

  	
   

  
	
  12.2

  	
  Determination
  of Top-Heaviness

  	
   

  
	
  12.3

  	
  Key
  Employees

  	
   

  
	
  12.4

  	
  Aggregation
  Rules

  	
   

  
	
  12.5

  	
  Special
  Minimum Contribution and Vesting Rules Becoming Operative in the Event the
  Plan Becomes Top-Heavy

  	
   

  
	
  12.6

  	
  Termination of Top-Heavy Status

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE XIII

  
	
  SPECIAL SITUATIONS

  
	
   

  
	
  13.1

  	
  Definitions

  	
   

  
	
  13.1(a)

  	
  Annuity Starting Date

  	
   

  
	
  13.1(b)

  	
  Prior Company

  	
   

  
	
  13.1(c)

  	
  Prior Plan

  	
   

  
	
  13.1(d)

  	
  Transferred Employee

  	
   

  
	
  13.2

  	
  Eligibility
  of Transferred Employees

  	
   

  
	
  13.3

  	
  Prior
  Plan Accounts and Joint and Survivor Annuity Accounts

  	
   

  
	
  13.4

  	
  Vesting
  of Transferred Employees

  	
   

  
	
  13.5

  	
  Distribution
  of Accounts of Transferred Employees

  	
   

  

 

v

 

	
  13.6

  	
  Assignment
  of Joint and Survivor Annuity Account for Plan Loan

  	
   

  
	
  13.7

  	
  Rollover
  Contribution Account of Non-Transferred Employees

  	
   

  
	
   

  	
   

  	
   

  
	
  APPENDIX A 

  	
  Effective Date Provisions

  	
   

  
	
  APPENDIX B 

  	
  Elections Relating to Nondiscrimination Testing and Highly
  Compensated Employee Determination

  	
   

  
				

 

vi

 

PREAMBLE

 

The Computer Associates Savings Harvest Plan (the “CASH Plan”), as
amended and restated effective March 31, 1997, constitutes an amendment,
restatement and continuation of the CASH Plan as in effect on March 30, 1997
and as thereafter amended.

 

Initially, Computer Associates International, Inc. (the “Company”)
adopted each of the Computer Associates International, Inc. Employees’ Money
Purchase Pension Plan (the “Pension Plan”) and the Computer Associates
International, Inc. Employees’ Profit Sharing Plan (the “Profit Sharing Plan”)
effective as of January 1, 1981 (referred to collectively hereinafter as the “Prior
Plans”).  In March of 1985, the Company
amended the Pension Plan to convert said Plan into a profit sharing plan (“Employees’
Savings and Thrift Plan”) for the Plan Year ending March 31, 1985.

 

Effective April 1, 1985, the Company completely amended and restated
the Employees’ Savings and Thrift Plan and merged 

 

 

the Profit Sharing Plan with
and into the aforesaid Plan, thereby creating the CASH Plan.

 

The CASH Plan was subsequently amended from time to time as a result of
certain acquisitions by the Company to set forth the rights of employees of the
acquired companies who became employees of the Company and participants in the
CASH Plan.  The CASH Plan was also subsequently
further amended from time to time to make certain improvements and changes
thereto.  In addition, the Plan was
subsequently amended and restated in its entirety effective April 1, 1988 and
effective March 31, 1992, respectively, to incorporate all amendments that were
made prior to the respective restatements, to make certain further improvements
and changes, and, with respect to the April 1, 1988 amendment and restatement,
bring the Plan into compliance with certain provisions of the Tax Reform Act of
1986 (“TRA’86”), and with respect to the March 31, 1992 amendment and
restatement, bring the Plan into compliance with all of the relevant 

 

 

provisions of TRA’86, the
Omnibus Budget Reconciliation Act of 1986, the Omnibus Budget Reconciliation Act
of 1987, the Technical and Miscellaneous Revenue Act of 1988, the Omnibus
Reconciliation Act of 1989, and the Unemployment Compensation Amendments of
1992.

 

Subsequent to the March 31, 1992 amendment and restatement, the Plan
was further amended from time to time as a result of further acquisitions by
the Company to set forth the rights of employees of the acquired companies who
became employees of the Company and participants in the CASH Plan, and to
(a)(i) change the allocation formula with respect to Employer Discretionary
Contributions, (ii) comply with the limitation on compensation set forth in
section 401(a)(17) of the Internal Revenue Code of 1986, as amended by the
Omnibus Budget Reconciliation of 1993, and (iii) permit Plan participants to
waive the thirty (30) day time period for consenting to a

 

 

distribution under Section
411(a)(11) of the Internal Revenue Code of 1986, as amended (the “Code”),
(b)(i) clarify that the classification of part-time employees who are excluded
from participating in the Plan are those employees who are employed on an
hourly basis, (ii) permit distributions pursuant to a Qualified Domestic
Relations Order prior to a participant’s earliest retirement age, and (iii)
make certain technical changes relating to hardship distributions and
determining Highly Compensated Employees, (c)(i) improve eligibility by
permitting eligible employees to commence participation with respect to Pre-Tax
Contributions on the first day of the calendar month following their date of
hire and (ii) make certain technical changes relating to the administrative
processing of distributions, (d) permit participants to waive the thirty (30)
day time period for consent to a distribution under Code Section 417(e), (e)
permit eligible employees of Infresco Corporation (“Infresco”), a wholly-owned
subsidiary of the Company, to

 

 

participate in the CASH Plan
except with respect to any Employer Discretionary Contributions, and credit
eligibility and vesting service for service with Kindle Incorporated, the
predecessor of Infresco, (f) permit active participants to receive in-service
distributions on or after age fifty-nine and one-half (59-1/2) regardless of
hardship, and (g) permit the use of forfeitures to satisfy Employer
Discretionary Contributions.

 

Effective March 31, 1997, the CASH Plan was again completely amended
and restated to (a) incorporate all amendments made to the Plan since its most
recent amendment and restatement effective March 31, 1992, (b) in connection
with further acquisitions by the Company, set forth the rights of those
employees of the acquired companies who became employees of the Company and
participants in the CASH Plan as a result of said acquisitions, and (c) bring
the provisions of the CASH Plan into compliance with the provisions of the
Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”),
the 

 

 

Retirement Protection Act of
1994 (“RPA”), the Small Business Job Protection Act of 1996 (“SBJPA”), and the
Taxpayer Relief Act of 1997 (“TRA’97”).

 

Subsequent to the March 31, 1997 amendment and restatement, the Plan
was amended in connection with further acquisitions by the Company to set forth
the rights of those employees of the acquired companies who became employees of
the Company and participants in the CASH Plan as a result of said acquisitions.

 

The purpose of this amendment and restatement of the CASH Plan is to
(a) incorporate all amendments made to the Plan since its most recent amendment
and restatement, (b) remove certain optional forms of distribution as permitted
by Code Section 411(d)(6) and the regulations promulgated thereunder, (c)
improve the distribution options under the Plan by permitting Participants to
elect to receive their distributions at any time after termination of
employment, subject to the applicable requirements of Code Section 401(a)(9)
and the regulations

 

 

promulgated thereunder, (d)
make certain additional technical changes, and (e) bring the provisions of the
CASH Plan into compliance with the provisions of the Internal Revenue
Restructuring and Reform Act of 1998 (“IRRA”), and thereby ensure that the Plan
and the Trust created thereunder continue to be qualified and tax-exempt,
respectively, under Sections 401(a), 401(k) and 501(a) of the Code.

 

The terms of this amended and restated Plan shall apply only with
respect to employees who are in the employ of the Company on or after the
effective date of this amendment and restatement, which effective date shall,
except as otherwise provided in the Appendix attached to this Plan and made a
part hereof, be March 31, 1997.  In
addition, any actions which have been taken under this Plan prior to March 31,
1997, including but not limited to, the making of any distributions, loans, or
contributions thereunder, shall be governed by the terms of the Plan then in
effect.

 

 

The purposes of the CASH Plan were, and continue to be, to continue the
benefits that were provided under the Prior Plans and to allow participants to
contribute a portion of their salaries, on a pre-tax basis, in order to
accumulate capital for their retirement. 
The CASH Plan and the Trust created thereunder are intended to meet the
applicable requirements of Sections 401(a), 401(k) and 501(a) of the
Code.

 

 

ARTICLE I

GENERAL
DEFINITIONS

 

The following terms shall have the meanings specified below, unless the
context otherwise requires.

 

1.1                                 Beneficiary
means an individual or other entity designated by a Participant in accordance
with the procedure described in Section 7.5 hereof or, in the absence of any
such designation, the estate of such Participant.

 

1.2                                 Code
means the Internal Revenue Code of 1986, as amended from time to time.

 

1.3                                 Committee
means the individuals appointed by the Employer pursuant to Section 10.1(a),
and when appropriate, such term shall include any individual to whom fiduciary
responsibilities shall have been delegated in accordance with Section 10.1(g)
or (h).

 

1.4                                 (a)                                  Compensation
means for any Plan Year, except as otherwise provided Section 4.6(a) or the
Plan, the basic

 

1

 

compensation (excluding
overtime pay, commissions or bonuses, but including Pre-Tax Contributions made
pursuant to Section 4.1 and elective contributions made by the Employer on
behalf of an Employee that are not included in the Employee’s gross income
under Section 125 of the Code) paid to an Employee by the Employer during such
Plan Year.

 

(b)                                 Notwithstanding
anything in this Plan to the contrary, the amount of Compensation which may be
taken into account for any Participant in any Plan Year shall not exceed
$160,000, as adjusted for increases in the cost-of-living in accordance with
Section 401(a)(17)(B) of the Code and any Treasury Regulations or other notices
or rulings promulgated thereunder; provided, however, that the cost-of-living
adjustment in effect for a calendar year shall apply with respect to the Plan
Year beginning in such calendar year.  If
Compensation shall be determined over a period that contains less than twelve
(12)

 

2

 

calendar months, then the
annual Compensation limit shall be an amount equal to the otherwise applicable
annual Compensation limit multiplied by a fraction, the numerator of which is
the number of months in the short determination period, and the denominator of
which is twelve (12).  With respect to
Pre-Tax, Employer Matching and Voluntary Contributions, the Committee may apply
the limitation set forth in this paragraph (b) by prorating the applicable
limitation, as adjusted, for a Plan Year over the number of pay periods during
the Plan Year.

 

1.5                                 Disability
means an inability 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 to be of long, continued and indefinite duration.  For this purpose, the Committee may require a
certification from a physician regarding such Disability, and the

 

3

 

Committee’s determination as to
whether Disability exists shall be conclusive.

 

1.6                                 Effective
Date of this amended and restated Plan means March 31, 1997, except as
otherwise provided in the Appendix attached to, and made a part of, this Plan.

 

1.7                                 Employee
means any individual employed by the Employer, except that such term shall not
include an independent contractor, any individual with a written service (as
opposed to employment) agreement, or any individual employed by the Employer on
an hourly basis.  Notwithstanding
anything herein or the Plan to the contrary, any individual who is not reported
on the Employer’s payroll records as a common law employee shall not be
eligible to participate in this Plan in any respect during the period of
classification as an independent contractor or individual with a written
service agreement, in the event that a court or administrative agency subsequently
determines that such

 

4

 

individual was a common law
employee for all or a part of that period.

 

1.8                                 Employer
means Computer Associates International, Inc., a Delaware corporation, any
successor (by merger, consolidation, purchase or otherwise) to such corporation
which shall have assumed the obligations of such corporation under this Plan,
and, except as otherwise provided, any Related Company which shall have adopted
the Plan with respect to its Employees with the approval of Computer Associates
International, Inc. or the Executive Committee of the Board of Directors of
Computer Associates International, Inc. 
(For the period prior to May 29, 1981, Computer Associates
International, Inc. was known as Trans-American Computer Associates, Inc.)

 

1.9                                 Employer
Contributions mean Employer Discretionary Contributions and Employer
Matching Contributions.

 

5

 

1.10                           Employer
Discretionary Contributions mean those contributions made to the Plan by
the Employer on behalf of a Participant pursuant to Section 4.5.

 

1.11                           Employer
Matching Contributions mean those contributions made to the Plan by the
Employer on behalf of a Participant pursuant to Section 4.4.

 

1.12                           ERISA
means the Employee Retirement Income Security Act of 1974, as amended from time
to time.

 

 

1.13                           Highly
Compensated Employee means an Employee as described in Section 4.10(a)(ii)(B).

 

1.14                           Hour
of Service means each hour for which an Employee is paid, or entitled to
payment, for the performance of duties for the Employer or a Related Company.

 

1.15                           Normal
Retirement Age means, with respect to any Participant, the first day of the
month during which he attains age sixty-five (65).

 

6

 

1.16                           One
Year Break-in-Service means a twelve (12) consecutive-month Period of
Severance, except as otherwise provided in (a) and (b) below.

 

(a)                                  Notwithstanding
anything in this Section 1.16 to the contrary, in the case of an Employee who
is absent from employment for maternity or paternity reasons, the twelve (12)
consecutive-month period beginning on the first anniversary of the first date
of such absence shall not constitute a One Year Break-In-Service.  For the purposes of this subsection, an
absence from employment for maternity or paternity reasons means an absence (i)
because of the pregnancy of the Employee, (ii) because of the birth of a child
of the Employee, (iii) because of the placement of a child with the Employee in
connection with the adoption of such child by such Employee, or (iv) for the
purpose of

 

7

 

caring for such child for a period beginning immediately after such
birth or placement.

 

The Committee, within a reasonable period of
time after a maternity or paternity leave of absence as described above, may
require the Employee to furnish evidence satisfactory to the Committee, such as
a doctor’s statement, which establishes that such absence was taken for
maternity or paternity reasons as set forth hereinbefore and which sets forth
the number of days of such absence.  If
the Employee fails to submit such evidence within a reasonable period of time
after such request, such absence shall be deemed not to have occurred for
maternity or paternity reasons for purposes of this Section 1.16.

 

(b)                                 Notwithstanding
anything in this Section 1.16 to the contrary, an Employee who is reemployed pursuant
to USERRA shall be treated as not having incurred a One Year

 

8

 

Break-in-Service by reason of any period of Qualified Military Service.

 

1.17                           Participant
means an Employee who participates in the Plan pursuant to the provisions of
Article III and shall also include individuals whether or not Employees who
have amounts to their credit which have not been distributed to them or their
Beneficiaries.

 

1.18                           Period
of Separation means a period of time commencing with the date an Employee
separates from service with the Employer and ending with the date such Employee
resumes employment with the Employer.

 

1.19                           Period
of Service means, for purposes of determining an Employee’s initial or
continued eligibility to participate in the Plan, the time period commencing
with the Employee’s Employment Commencement Date with the Employer and ending
on the date a Period of Severance begins. 
An Employee’s

 

9

 

Employment Commencement Date
shall be that date on which he renders his first Hour of Service for the
Employer.  A Period of Service for these
purposes includes a Period of Separation of less than twelve (12) consecutive
months.  In the case of an Employee who
separates from service with the Employer and later resumes employment with the
Employer, the Period of Service prior to his resumption of employment shall be
aggregated only if such Employee is a Re-employed Individual.  In the case of an Employee who separates from
service with the Employer, later resumes employment with the Employer and is
not a Re-employed Individual, for the purpose of determining such Employee’s
Period of Service, such Employee’s Employment Commencement Date shall be the
date on which such Employee renders his first Hour of Service with the Employer
upon his resumption of employment.  An
Employee’s Period of Service shall include service with a Related Company, and

 

10

 

where required in order to compute
any Employee’s Period of Service, the term Employer shall include a Related
Company.

 

1.20                           Period
of Severance means a period of time commencing with the earlier of:

 

(a)                                  the
date an Employee separates from service with the Employer by reason of quitting,
retirement, death or discharge, or

 

(b)                                 the
date twelve (12) months after the date an Employee separates from service with
the Employer for any other reason, and ending, in the case of an Employee who
separates from service with the Employer by reason other than death, with the
date such Employee resumes employment with the Employer.

 

1.21                           Plan
means the Computer Associates Savings Harvest Plan (the “CASH Plan”), which is
intended to be a profit sharing plan for purposes of Sections 401(a), 402, 412
and 417 of the

 

11

 

Code, and, where applicable,
shall also include prior plans referred to in the PREAMBLE of this Plan
document.

 

1.22                           Plan
Year means the taxable year of the Plan commencing on March 31 and ending
on the following March 30.

 

1.23                           Pre-Tax
Contributions mean those contributions made by the Employer on behalf of a
Participant in accordance with the provisions of Section 4.1.

 

1.24                           Qualified
Military Service means any service in the uniformed services, as defined
under USERRA, by an Employee if such Employee is entitled to reemployment
rights under USERRA with respect to such service.

 

1.25                           Re-Employed
Individual means a person who, after having separated from service, resumes
employment with the Employer,

 

12

 

(a)                                  with
any vested interest in his Employer Matching Account or Employer Discretionary
Contribution Account, or

 

(b)                                 with
no such vested interest, and who resumes such employment either (i) before
incurring five (5) consecutive One Year Breaks-in-Service, or (ii) after
incurring five (5) consecutive One Year Breaks-in-Service but before his latest
Period of Severance equals or exceeds his Period of Service.

 

1.26                           Related
Company means any corporation which is (a) a member of a controlled group
of corporations (within the meaning of Section 414(b) of the Code, as modified
by Section 415(h) of the Code solely for purposes of Section 5.5) of which the
Employer is a member, (b) any trade or business (whether or not incorporated)
which is under common control (within the meaning of Section 414(c) of the
Code, as modified by Section 415(h)

 

13

 

of the Code solely for purposes
of Section 5.5) with the Employer, (c) any business organization which together
with the Employer forms an affiliated service group (within the meaning of
Section 414(m) of the Code), and (d) any other entity required to be aggregated
with the Employer pursuant to regulations under Section 414(o) of the Code.

 

1.27                           Rollover
Contributions mean those contributions made to the Plan on behalf of a
Participant or Employee in accordance with Section 4.12.

 

1.28                           Salary
Reduction Agreement means an agreement between a Participant and the Employer
as described in Section 4.2.

 

1.29                           Trust
means the trust organized in the State of New York which forms a part of this
Plan and to which contributions are made by the Employer in respect of
Participants and from which payments are made to Participants and their
Beneficiaries pursuant to the provisions of this Plan.

 

14

 

1.30                           Trustee
means, at any time, the trustee or trustees of the Trust then in office.

 

1.31                           USERRA
means the Uniformed Services Employment and Reemployment Rights Act of 1994, as
may be amended from time to time.

 

1.32                           Valuation
Date means each calendar day of each Plan Year (excluding Saturday, Sunday
and any day on which the New York Stock Exchange shall be closed), or any other
date or dates selected from time to time by the Committee.

 

1.33                           Voluntary
Contributions mean those contributions made to the Plan on behalf of a
Participant in accordance with Section 4.7.

 

15

 

ARTICLE II

OBJECTIVE OF
THE PLAN

 

2.1                                 The
objective of this Plan is to provide a source of retirement income for
Participants and their Beneficiaries, if any, and to enable Participants to
share in the profits of the Employer.

 

2.2                                 The
Plan is for the exclusive benefit of Participants and their Beneficiaries, if
any, and, except as provided in Section 9.6, at no time prior to the
satisfaction of all liabilities under the Plan to them may any Plan assets be
used for or diverted to any purpose other than for their exclusive benefit.

 

16

 

ARTICLE III

PARTICIPATION

 

3.1                                 Eligibility.

 

(a)                                  Each
Employee who was a Participant in the Plan as of March 30, 1997 shall continue
to be a Participant in accordance with the terms of this amended and restated
Plan.

 

(b)                                 Except
as otherwise provided in paragraph (c) below, each other Employee shall be
eligible to participate in the Plan

 

(i)                                     with
respect to Pre-Tax Contributions, on the date such Employee completes his first
Hour of Service; and

 

(ii)                                  with
respect to Employer Matching Contributions, Employer Discretionary
Contributions, and Voluntary Contributions, on the date such Employee completes
a Period of Service of one year; provided, however, that, commencing effective
July 1, 2001, an Employee shall be eligible to participate with respect to
Voluntary

 

17

 

Contributions on the date the Employee completes his first Hour of
Service.

 

(c)                                  Notwithstanding
anything herein to the contrary, an Employee shall not be eligible to
participate in the Plan if such Employee is

 

(i)                                     included
in a unit of employees covered by a collective bargaining agreement between
employee representatives and the Employer (unless such collective bargaining
agreement calls for the inclusion of such employees herein); or

 

(ii)                                  a
non-resident alien receiving no earned income (within the meaning of Section
911(d)(2) of the Code) from the Employer which constitutes income from sources
within the United States (within the meaning of Section 861(a)(3) of the Code).

 

18

 

3.2                                 Date
of Participation.

 

(a)                                  (i)                                     With
respect to Pre-Tax Contributions, an Employee shall become a Participant on the
first day of the calendar month following his completion of the eligibility
requirements set forth in Section 3.1(b)(i); provided, however, that the
Employee must be actively employed by the Employer on such date in order to
become a Participant on such date. 
Notwithstanding the preceding, commencing effective July 1, 2001, an
Employee shall become a Participant with respect to Pre-Tax Contributions on
the date he completes the eligibility requirements under Section 3.1(b)(i).

 

(ii)                                  Except
as provided in Section 3.1(c), an Employee who separates from service with the
Employer and resumes employment with the Employer shall become a Participant
with respect to Pre-Tax Contributions in accordance with subparagraph (i) above
upon his satisfaction

 

19

 

of the eligibility requirements set forth in Section 3.1(b)(i) after
his resumption of employment with the Employer.

 

(b)                                 (i)                                     With
respect to Employer Matching Contributions, Employer Discretionary
Contributions, and Voluntary Contributions, an Employee shall become a
Participant on the first day of the calendar month following the anniversary of
the date he completes the eligibility requirements set forth in Section
3.1(b)(ii); provided, however, that the Employee must be actively employed by
the Employer on such date in order to become a Participant on such date.  Notwithstanding anything herein to the
contrary, commencing effective July 1, 2001, an Employee shall become a
Participant with respect to Voluntary Contributions on the date he completes
such eligibility requirements.

 

(ii)                                  Except
as provided in Section 3.1(c), a Re-employed Individual who completed a Period
of Service of

 

20

 

one year before his Period of Severance began shall become eligible to
participate on the date his Period of Severance ends.

 

(c)                                  Notwithstanding
anything herein to the contrary, no Pre-Tax Contributions, Employer Matching
Contributions, or Voluntary Contributions shall be made on behalf of a
Participant until he has filed, in the case of Pre-Tax and Employer Matching
Contributions, a Salary Reduction Agreement, and in the case of Voluntary Contributions,
a payroll deduction agreement with the Employer specifying the percentage by
which his Compensation is to be reduced to provide for Pre-Tax Contributions or
Voluntary Contributions, as applicable. 
If an Employee fails to file a Salary Reduction Agreement with respect
to Pre-Tax Contributions or a payroll deduction agreement with respect to
Voluntary Contributions prior to the date he first becomes eligible to
participate in the Plan with respect to such Contributions, he shall be
eligible for Pre-Tax Contributions, Employer Matching Contributions and
Voluntary Contributions, as applicable, for the payroll period commencing as
soon as practicable after the date he files a Salary Reduction Agreement or
payroll deduction agreement, as applicable, with the Employer.

 

21

 

ARTICLE IV

CONTRIBUTIONS
TO THE PLAN

 

4.1                                 Pre-Tax
Contributions.

 

(a)                                  Subject
to the restrictions and limitations set forth under Sections 4.9(d), 4.10(a)
and Section 4.11, the Employer shall make Pre-Tax Contributions on behalf of
each Participant in an amount equal to the amount by which such Participant’s
Compensation has been reduced pursuant to the Salary Reduction Agreement
entered into between the Employer and the Participant pursuant to Section 4.2;
provided, however, that for each calendar year, in no event shall Pre-Tax
Contributions made on behalf of any Participant exceed $9,500, as may be
adjusted from time to time by the Secretary of the Treasury pursuant to Section
402(g)(5) of the Code.  Pre-Tax
Contributions not exceeding five percent (5%) of the Participant’s Compensation
shall be referred to as “Basic Pre-Tax Contributions” and Pre-Tax Contributions
in excess of five percent (5%) of the Participant’s

 

22

 

Compensation shall be referred
to as “Supplemental Pre-Tax Contributions.”

 

(b)                                 (i)                                     If
the amount of Pre-Tax Contributions made on behalf of a Participant for a
calendar year exceeds $9,500, as adjusted, such excess (and the income
allocable thereto) shall be distributed to such Participant no later than the
April 15th first following such calendar year. 
Not- withstanding anything herein to the contrary, (A) any excess
Pre-Tax Contributions that may be distributed to a Participant pursuant to this
paragraph (b) for a calendar year shall be reduced by any Excess Pre-Tax
Contributions previously distributed to, or recharacterized on behalf of, such
Participant pursuant to Section 4.10(a)(iv) for the Plan Year beginning with or
within such calendar year and (B) any Pre-Tax Contributions distributed as
excess Annual Additions pursuant to Section 4.11(b)(ii)

 

23

 

shall be disregarded in
determining whether the $9,500 limitation, as adjusted, is exceeded.

 

(ii)                                  For
the purpose of this paragraph (b), the income allocable to excess Pre-Tax
Contributions for a calendar year shall be equal to the sum of the allocable
gains or losses for such calendar year, which shall be determined pursuant to
(A) or (B) as follows:

 

(A)                              By
multiplying the income or loss for the calendar year allocable to the
Participant’s Pre-Tax Contribution Account by a fraction, the numerator of
which is the Participant’s excess Pre-Tax Contributions for the calendar year
and the denominator of which is the sum of (1) the Participant’s Pre-Tax
Contribution Account as of the beginning of the calendar year and (2) the
Participant’s Pre-Tax Contributions for said calendar year.

 

24

 

(B)                                Pursuant
to the method of allocating income or losses to Participants’ Accounts as set
forth in Section 5.3.

 

The Committee shall have the complete discretion to determine which of
the methods set forth under (A) or (B) above shall be used with respect to a
calendar year, provided that the method chosen is applied in a
nondiscriminatory manner and consistently for all Participants and all
distributions of excess Pre-Tax Contributions for the calendar year.

 

4.2                                 Salary
Reduction Agreements.  Each Participant
who desires to have the Employer make Pre-Tax Contributions on his behalf shall
enter into a written Salary Reduction Agreement with the Employer which,
subject to the provisions of Section 4.3, will be applicable to payroll periods
commencing as soon as practicable after the date the Salary Reduction Agreement
is filed with the Employer. Subject to the provisions of Section 4.1,

 

25

 

the terms of any Salary
Reduction Agreement shall provide that the Participant agrees to accept a
reduction in his Compensation equal to any whole percentage not less than two
percent (2%) or greater than fifteen percent (15%).  In consideration of such Agreement, the
Employer shall make Pre-Tax Contributions to the Participant’s Account for each
payroll period during which the Salary Reduction Agreement is in force, in an
amount equal to the total amount by which the Participant’s Compensation was
reduced during such payroll period.

 

4.3                                 Amendment
and Revocation of Salary Reduction Agreements.

 

(a)                                  The
Employer may amend or revoke, at any time, its Salary Reduction Agreement, with
respect to Pre-Tax Contributions, and/or payroll deduction agreement, with
respect to Voluntary Contributions, with any Participant who is a Highly
Compensated Employee, if the Committee determines that such amendment or
revocation is necessary to insure that the

 

26

 

non-discrimination tests set
forth in Section 4.10 are satisfied for any Plan Year.

 

(b)                                 The
Employer may at any time amend or revoke its Salary Reduction Agreement, with
respect to Pre-Tax Contributions, and/or payroll deduction agreement, with
respect to Voluntary Contributions, with a Participant if the Employer
determines that such amendment or revocation is necessary to insure that a
Participant’s Annual Additions will not exceed the limitations under Section
4.11.

 

(c)                                  A
Participant may amend his Salary Reduction Agreement, with respect to Pre-Tax
Contributions, and/or payroll deduction agreement, with respect to Voluntary
Contributions, not more than one time during each calendar quarter, to
increase, decrease, or revoke the amount of Pre-Tax Contributions or Voluntary
Contributions made to the Plan on his behalf; provided, however, that effective
commencing July 1, 2001, any such

 

27

 

amendment may be made by the
Participant at any time.  Any amendment
hereunder shall become effective for the payroll period commencing as soon as
practicable following receipt by the Employer of notice of the amendment.

 

4.4                                 Employer
Matching Contributions.  Subject to
the restrictions and limitations of Sections 4.9(d), 4.10(b) and Section 4.11,
the Employer shall contribute to the Plan on behalf of each Participant as a “Matching
Contribution,” an amount equal to fifty percent (50%) of such Participant’s
Basic Pre-Tax Contributions, reduced by any amounts allocated to such
Participant’s Account pursuant to Section 6.4; provided, however, that if a
Participant’s Basic Pre-Tax Contributions during a Plan Year shall be limited
to an amount less than five (5%) percent of the Participant’s Compensation due
to the $9,500 (as adjusted) limitation set forth under Section 4.1(a), then
such Employer Matching Contribution shall be determined on the first five

 

28

 

percent (5%) of the aggregate
of the Participant’s Basic Pre-Tax Contributions and Voluntary Contributions
pursuant to Section 4.7.  In no
event shall the Employer Matching Contribution for a Plan Year exceed two and
one-half percent (2-1/2%) of the Participant’s Compensation.

 

4.5                                 Employer
Discretionary Contributions.  In
addition to the Contributions provided for in Sections 4.1 and 4.4 and subject
to the restrictions and limitations of Sections 4.9(d) and 4.11, the Employer
may contribute to the Plan in respect of each Plan Year, as an “Employer
Discretionary Contribution,” an amount as the Board of Directors of Computer
Associates International, Inc. shall, in its sole discretion, determine.

 

4.6                                 Allocation
of Employer Discretionary Contributions.

 

(a)           (i)            Subject to the restrictions and
limitations of Section 4.11 and subject to paragraph (b) below, for each Plan
Year during which an Employer Discretionary Contribution is made, each
Participant’s Employer Discretionary

 

29

 

Contribution Account shall be
credited, at the end of such Year, with that portion of the Employer
Discretionary Contribution for such Plan Year which bears the same ratio to
such Contribution as each Participant’s Compensation (as defined in
subparagraph (ii) below) for such Plan Year bears to the Compensation (as
defined in subparagraph (ii) below) of all Participants for such Plan Year.

 

(ii)           For purposes of
this Section 4.6 and subject to the limitation set forth in Section 1.4(b),
Compensation means the Participant’s rate of basic or regular compensation
(excluding overtime pay, commissions or bonuses, but including Pre-Tax
Contributions and elective contributions made by the Employer on behalf of an
Employee that are not included in the Employee’s gross income under Section 125
of the Code) in effect on the last day of such Plan Year;  provided, however, that in the case of an
Employee who enters or re-enters the Plan on a date other than the first day of
the Plan Year, such

 

30

 

Participant’s Compensation
hereunder for such Plan Year shall be multiplied by a fraction, the numerator
of which is the number of months in such Plan Year during which the Employee
was a Participant and the denominator of which is twelve (12).

 

(b)                                 Notwithstanding
anything herein to the contrary, no allocation shall be made for any Plan Year
with respect to any Participant whose employment terminated during such Plan
Year, unless such Participant shall have resumed employment during such Plan
Year and shall be employed at the end of such Plan Year.

 

(c)                                  Notwithstanding
anything herein to the contrary, if the Plan shall fail to meet the applicable
requirements of either Section 410(b)(1) or Section 410(b)(2)(A)(i) of the Code
and the regulations promulgated thereunder due to the fact that Employer
Discretionary Contributions for the Plan Year have not been allocated to a

 

31

 

sufficient number or percentage
of Participants for such Plan Year, then the following provisions shall apply:

 

(i)            The
group of Participants eligible to receive an allocation of Employer
Discretionary Contributions for the Plan Year shall, to the extent necessary to
satisfy the requirements described above, be expanded to include Participants
who are not actively employed by the Employer on the last day of the Plan Year,
beginning with those Participants whose date of termination during such Plan
Year was closest to the last day of such Plan Year.

 

(ii)           In
the event that the provisions of this paragraph (c) shall be applied during a
Plan Year, such provisions shall be deemed to be a retroactive amendment to the
Plan adopted by the last day of such Plan Year. 
In no event shall the application of this paragraph (c) result in the
elimination or reduction of

 

32

 

benefits under Section 411(d)(6) of the Code and the regulations
promulgated thereunder.

 

4.7                                 Voluntary
Contributions.  Subject to the
restrictions and limitations of Sections 4.10(b) and 4.11, a Participant may,
on such forms as prescribed by the Committee, elect to make Voluntary
Contributions to the Plan on an after-tax basis through regular payroll
deductions in an amount equal to any whole percentage not less than two percent
(2%) or greater than fifteen percent (15%) of the Participant’s Compensation
for the Plan Year.  Notwithstanding
anything in this Section or Section 4.3 to the contrary, in no event shall the
total amount of Pre-Tax Contributions, pursuant to Sections 4.1 and 4.2, and
Voluntary Contributions for any Plan Year exceed fifteen percent (15%) of the
Participant’s Compensation.

 

4.8                                 Make-Up
Contributions.  In the event that the
Committee determines prior to the close of any Plan Year that additional
Pre-Tax Contributions may be made on behalf of any

 

33

 

Participant, or that any
Participant may make additional Voluntary Contributions without violating the
provisions of Section 4.10 or Section 4.11, such Participants may be permitted,
within the sole discretion of the Committee which shall be granted in a uniform
and nondiscriminatory manner, to revise their Salary Reduction Agreements, on a
prospective basis only, or to make an additional Voluntary Contribution, in
accordance with a uniform procedure for such Plan Year established by the
Committee.

 

4.9                                 Form,
Payment and Timing of Contributions to the Trust.

 

(a)                                  Pre-Tax
Contributions, Voluntary Contributions and Employer Matching Contributions
shall be made in cash; provided, however, that Employer Matching Contributions
to the Company Stock Fund (as set forth in Section 10.4) may be made in shares
of common stock of Computer Associates International, Inc.

 

34

 

(b)                                 Employer
Discretionary Contributions may be made in cash and/or in kind, including, in
the case of such Contributions to the Company Stock Fund (as set forth in
Section 10.4), shares of common stock of Computer Associates International,
Inc.;  provided, however, that no
Contribution in kind may be made which would violate the prohibited transaction
rules of Section 4975 of the Code, or the corresponding rules under Section 406
of ERISA.

 

(c)                                  Contributions
pursuant to paragraphs (a) and (b) above shall be deposited into the Trust Fund
at the time and in accordance with procedures established by the Committee,
subject to the following:

 

(i)            Contributions
pursuant to paragraph (a) shall be deposited into the Trust Fund as soon as
practicable following the end of the payroll period with respect to which the
Participant’s Compensation was reduced

 

35

 

pursuant to the Salary Reduction Agreement or payroll deduction
agreement, but not later than the time prescribed by law for the contribution
of such amounts to the Plan; and

 

(ii)           Contributions pursuant to paragraphs
(a) and (b) above shall be deposited into the Trust Fund no later than the time
prescribed by law for filing the Employer’s Federal income tax return for the
taxable year for which the applicable Contribution is made, including
extensions thereof.

 

(d)                                 The
aggregate of Pre-Tax Contributions, Employer Matching Contributions and
Employer Discretionary Contributions for any Plan Year shall not exceed the
lesser of (i) the maximum amount deductible by the Employer under Section
404(a)(3)(A) of the Code as in effect for the Plan Year, including any
carryover deduction allowed thereunder, or (ii) the maximum amount permissible
under Section 4.11.

 

36

 

4.10                           Non-discrimination
Tests.

 

(a)           (i)                                     As
of each Valuation Date (or at such other intervals as it shall deem proper),
the Committee shall review the amount of Pre-Tax Contributions made to the Plan
on behalf of Participants in order to insure that one of the following
non-discrimination tests, pursuant to Section 401(k)(3) of the Code, will be satisfied
as of the end of the Plan Year:

 

(A)                              the
Actual Deferral Percentage (as hereinafter defined) for Highly Compensated
Employees eligible to participate in the Plan for the Plan Year is not more
than the Actual Deferral Percentage for the group of all other Employees
eligible to participate in the Plan for the preceding Plan Year multiplied by
1.25; or

 

(B)                                the
Actual Deferral Percentage for Highly Compensated Employees eligible to
participate in the Plan for the Plan Year does not exceed the Actual Deferral

 

37

 

Percentage for the group of all other Employees eligible to participate
in the Plan for the preceding Plan Year by more than two (2) percentage points,
and the Actual Deferral Percentage for the group of Highly Compensated
Employees eligible to participate in the Plan for the Plan Year is not more
than the Actual Deferral percentage for the group of all other Employees
eligible to participate in the Plan for the preceding Plan Year multiplied by
2.

 

Notwithstanding anything herein to the contrary, the Employer or
Committee may elect in Appendix B, which is attached to the Plan and made a
part hereof, to use the current Plan Year (“current year testing method”)
instead of the preceding Plan Year (“prior year testing method”) under the
aforesaid tests for a Plan Year; provided, however, that with respect to Plan
Years commencing after December 31, 2001 and except as may otherwise be
provided in any applicable notices or other pronouncements, if such

 

38

 

election is made, it may not be
changed except as provided by the Secretary of the Treasury.

 

(ii)                                  For
purposes of the preceding paragraph (a)(i):

 

(A)                              Actual
Deferral Percentage means, with respect to the group of Highly Compensated
Employees eligible to participate in the Plan and the group of all other
Employees eligible to participate in the Plan, the average of the ratios
(calculated separately for each Employee in each group) of the Pre-Tax Contributions
made on behalf of each such Employee for the Plan Year (including any excess
Pre-Tax Contributions distributed under Section 4.1(b) to Participants who are
Highly Compensated Employees and excluding any such distributions to
Participants who are not Highly Compensated Employees and any Pre-Tax

 

39

 

Contributions distributed as excess Annual
Additions pursuant to Section 4.11(b)(ii)) to such Employee’s Compensation for
such Plan Year.  For purposes of this subparagraph
(A), Compensation means compensation within the meaning of Section 414(s) of
the Code and any regulations promulgated thereunder by the Secretary of the
Treasury. 
The period which shall be used to determine Compensation for
purposes of this subparagraph (A) for a Plan Year shall, in the discretion of
the Committee, be either such Plan Year or the calendar year ending within such
Plan Year; provided, however, that selection of the period described herein by
the Committee shall be uniformly applied to determine the Compensation of each
eligible Employee for such Plan Year.

 

40

 

(B)                                Highly
Compensated Employee means any Employee, including an employee of a Related
Company, who (1) during the Plan Year for which a determination is being made
or the preceding Plan Year was at any time a five percent (5%) owner (as
defined in Section 416(i)(l) of the Code) of the Employer, or (2) for the
preceding Plan Year (a) received Compensation (as defined below) from the
Employer in excess of $80,000, as adjusted pursuant to Section 414(q)(1) of the
Code, and (b) if the Employer or Committee elects the application of this
clause (b) in Appendix B which is attached to and made a part of the Plan, was,
for such preceding Year, in the group consisting of the top twenty percent
(20%) of the Employees ranked on the basis of Compensation paid during such
Plan Year.

 

41

 

In determining the number of Employees in the top-paid group under
clause (B)(2) above, the following Employees shall be excluded: (i) Employees
who have not completed at least six (6) months of service; (ii) Employees who
normally work less than seventeen and one-half (17-1/2) hours per week; (iii)
Employees who normally work during not more than six (6) months during any Plan
Year; (iv) Employees who have not attained age twenty-one (21); and (v) except
to the extent provided in regulations, Employees who are included in a unit of
employees covered by an agreement which the Secretary of Labor finds to be a
collective bargaining agreement between employee representatives and the
Employer.  Except as provided by the
Secretary of the Treasury, the Employer may elect to apply (1), (2), (3), or
(4) herein by substituting a shorter

 

42

 

period of service, smaller number of hours or months, or lower age for
the period of service, number of hours or months, or age (as the case may be)
than that specified.

 

A former Employee shall be a Highly Compensated Employee if such
Employee was a Highly Compensated Employee upon separation from service or at
any time after attaining age fifty-five (55).

 

For purposes of this subparagraph (B), Compensation means compensation
within the meaning of Section 414(q)(4) of the Code.  In addition, the determination of Highly
Compensated Employees, including the determination of the number and identity
of Employees in the top-paid group, shall be made in accordance with the
regulations promulgated under Section 414(q) of the

 

43

 

Code, and any other applicable pronouncements promulgated by the
Secretary of the Treasury.

 

For purposes of this subparagraph (ii), Employees shall not include
Employees who are non-resident aliens and who receive no earned income (within
the meaning of Section 911(d)(2) of the Code) from the Employer which
constitutes income from sources within the United States (within the meaning of
Section 861(a)(3) of the Code).

 

Notwithstanding anything in this subparagraph (ii) to the contrary, for
purposes of determining Highly Compensated Employees under this subparagraph
(ii), the calendar year calculation election set forth in paragraph (b) of
Q&A-14 of Treas. Reg. Section 1.414(q)-1T may apply as elected in Appendix
B which is attached to and made a part of the Plan.

 

44

 

(iii)                               In
the event the Committee determines, based upon a review of the Actual Deferral
Percentages, that the non-discrimination tests set forth in paragraph (a)(i)
above will not be met by the end of the Plan Year, it shall notify the Employer
to take measures pursuant to Section 4.3(a) in order to insure compliance with
the non-discrimination rules of Section 401(k)(3) of the Code.

 

(iv)                              (A)                              If,
after the close of a Plan Year, there are Excess Pre-Tax Contributions (as
defined in (C) below) due to the failure to meet either of the
non-discrimination tests set forth in paragraph (a)(i) of this Section 4.10,
then, within two and one-half (2-1/2) months of the close of such Plan Year,
such Excess Pre-Tax Contributions (and any income allocable thereto) shall be
distributed to Highly Compensated Employees on the basis of the respective
portions of the Excess Pre-Tax Contributions attributable to each such Employee
by reducing the

 

45

 

Pre-Tax Contributions made on
behalf of Highly Compensated Employees beginning with the highest of such
Pre-Tax Contributions, until all of such Excess Pre-Tax Contributions have been
distributed; provided, however, that in lieu of such distribution, such Highly
Compensated Employees may be permitted, in accordance with Section
401(k)(8)(A)(ii) of the Code and the regulations promulgated thereunder, to
elect to have such Excess Pre-Tax Contributions recharacterized as Voluntary
Contributions, subject to the provisions of paragraph (b) of this Section 4.10
and Section 4.11.  Notwithstanding
anything herein to the contrary, any Excess Pre-Tax Contributions that may be
distributed or recharacterized pursuant to this paragraph (iv) with respect to
a Participant for a Plan Year, shall be reduced by any excess Pre-Tax
Contributions previously distributed to such Participant pursuant to Section
4.1(b) for the calendar year ending with or within such Plan Year.

 

46

 

(B)                                For
the purpose of this subparagraph (iv), the income allocable to Excess Pre-Tax
Contributions for a Plan Year shall be equal to the sum of the allocable gains
or losses for such Plan Year, which shall be determined pursuant to (1) or (2)
as follows:

 

(1)                                  By
multiplying the income or loss for the Plan Year allocable to the Participant’s
Pre-Tax Contribution Account by a fraction, the numerator of which is the
Participant’s Excess Pre-Tax Contributions for the Plan Year and the
denominator of which is the sum of (a) the Participant’s Pre-Tax Contribution
Account as of the beginning of the Plan Year and (b) the Participant’s Pre-Tax
Contributions for said Plan Year.

 

(2)                                  Pursuant
to the method of allocating income or losses to Participants’ Accounts as set
forth in Section 5.3.

 

47

 

The Committee shall have the complete discretion to determine which of
the methods set forth under (1) or (2) above shall be used with respect to a
Plan Year, provided that the method chosen is applied in a nondiscriminatory
manner and consistently for all Participants and all distributions of Excess
Pre-Tax Contributions for the Plan Year.

 

(C)                                For
purposes of this paragraph (iv), “Excess Pre-Tax Contributions” means, with
respect to a Plan Year, the aggregate amount of Pre-Tax Contributions actually
paid over to the Plan on behalf of Highly Compensated Employees for such Plan
Year, over the maximum amount of Pre-Tax Contributions permitted under the
non-discrimination tests set forth in paragraph (a)(i) of this Section 4.10 for
such Plan Year.

 

(b)                                 (i)                                     As
of each Valuation Date (or at such other intervals as it shall deem proper),
the Committee shall review the amount of Employer Matching Contributions and

 

48

 

Voluntary Contributions made to
the Plan during the Plan Year in order to insure that the Contribution
Percentage (as hereinafter defined) for Highly Compensated Employees eligible
to participate in the Plan for the Plan Year does not exceed, pursuant to
Section 401(m)(2)(A) of the Code, the greater of

 

(A)                              one
hundred twenty-five percent (125%) of the Contribution Percentage for all other
Employees eligible to participate in the Plan for the preceding Plan Year, or

 

(B)                                the
lesser of (1) two hundred percent (200%) of the Contribution Percentage for all
other Employees eligible to participate in the Plan for the preceding Plan
Year, or (2) the Contribution Percentage for all other Employees eligible to
participate in the Plan for the preceding Plan Year plus two (2) percentage
points.

 

49

 

Notwithstanding anything herein to the contrary, the Employer or
Committee may elect in Appendix B, which is attached to the Plan and made a
part hereof, to use the current Plan Year (“current year testing method”) instead
of the preceding Plan Year (“prior year testing method”) under the aforesaid
tests for a Plan Year; provided, however, that with respect to Plan Years
commencing after December 31, 2001 and except as may otherwise be provided in
any applicable notices or other pronouncements, if such election is made, it
may not be changed except as provided by the Secretary of the Treasury.

 

(ii)                                  For
the purposes of the preceding paragraph (b)(i), “Contribution Percentage”
means, with respect to the group of Highly Compensated Employees eligible to
participate in the Plan and the group of all other Employees eligible to
participate in the Plan, the average of the ratios (calculated separately for
each Employee in each group) of the

 

50

 

sum of Employer Matching
Contributions and Voluntary Contributions allocated to each such Employee’s
Account for the Plan Year (excluding any Voluntary Contributions distributed as
excess Annual Additions pursuant to Section 4.11(b)(i)), to such Employee’s
Compensation for such Plan Year.  For
purposes of this paragraph (ii), Compensation means compensation within the
meaning of Section 414(s) of the Code and any regulations promulgated
thereunder by the Secretary of the Treasury. 
The period which shall be used to determine Compensation for purposes of
this paragraph (ii) for a Plan Year shall, in the discretion of the Committee,
be either such Plan Year or the calendar year ending within such Plan Year;
provided, however, that selection of the period described herein by the
Committee shall be uniformly applied to determine the Compensation of each
eligible Employee for such Plan Year.

 

51

 

(iii)                               (A)                              If,
after the close of a Plan Year, there are Excess Aggregate Contributions (as
defined in (C) below) due to the failure to meet the non-discrimination test
set forth in the preceding paragraph (b)(i) of this Section 4.10, then, within
two and one-half (2-1/2) months of the close of such Plan Year, such Excess
Aggregate Contributions (and any income allocable thereto) shall be distributed
to Highly Compensated Employees on the basis of the respective portions of
Excess Aggregate Contributions attributable to each such Employee by reducing
such Contributions for Highly Compensated Employees beginning with the highest
of such Contributions until all of such Excess Aggregate Contributions have
been distributed.

 

(B)                                For
the purpose of this paragraph (iii), the income allocable to Excess Aggregate
Contributions for a Plan Year shall be equal to the sum of the allocable gains
or

 

52

 

losses for such Plan Year,
which shall be determined pursuant to (1) or (2) as follows:

 

(1)                                  By
multiplying the income or loss for the Plan Year allocable to the Participant’s
Voluntary Contribution Account and the Participant’s Employer Matching
Contribution Account by a fraction, the numerator of which is the Participant’s
Excess Aggregate Contributions for the Plan Year and the denominator of which
is the sum of (a) the Participant’s Employer Matching and Voluntary
Contribution Accounts as of the beginning of the Plan Year and (b) the
Participant’s Employer Matching and Voluntary Contributions for said Plan Year.

 

(2)                                  Pursuant
to the method of allocating income or losses to Participants’ Accounts as set
forth in Section 5.3.

 

53

 

The Committee shall have the complete discretion to determine which of
the methods set forth under (1) or (2) above shall be used with respect to a
Plan Year, provided that the method chosen is applied in a nondiscriminatory
manner and consistently for all Participants and all distributions of Excess
Aggregate Contributions for the Plan Year.

 

(C)                                For
purposes of this paragraph (iii), “Excess Aggregate Contributions” means, with
respect to any Plan Year, the aggregate amount of Employer Matching
Contributions and Voluntary Contributions actually paid to the Plan on behalf
of Highly Compensated Employees for the Plan Year over the maximum amount of
such Contributions permitted under the non-discrimination test set forth in
paragraph (b)(i) of this Section 4.10 for such Plan Year.

 

(c)                                  Notwithstanding
anything herein to the contrary, all or any portion of Employer Matching
Contributions

 

54

 

made to the Plan during the
Plan Year may, in accordance with the regulations promulgated under Sections
401(k) and 401(m) of the Code, be treated as Pre-Tax Contributions for purposes
of the nondiscrimination test set forth in paragraph (a) above for the Plan
Year, and to the extent so treated shall (i) not be subject to the
nondiscrimination test set forth in paragraph (b) above for the Plan Year, (ii)
be allocated to the Participant’s Pre-Tax Contribution Account, and (iii) be
subject to all of the vesting and distribution requirements relating to Pre-Tax
Contributions under the terms of this Plan.

 

(d)                                 The
non-discrimination tests set forth under this Section 4.10 shall be subject, if
applicable, to the regulations set forth under Section 401(m) of the Code
relating to the multiple use of alternative limitations under Sections
401(k)(3)(A)(ii)(II) and 401(m)(2)(A)(ii) of the Code.

 

55

 

(e)                                  Notwithstanding
anything in this Section or this Article to the contrary and subject to the
limitations set forth in Section 4.9(d) and Section 4.11, the Employer may, in
accordance with the regulations promulgated under Sections 401(k) and (m) of the
Code, make Qualified Nonelective Contributions (as defined hereinafter) to the
Plan for any Plan Year on behalf of eligible Employees who are not Highly
Compensated Employees and considered under such tests, if the Employer shall
determine that such Contributions are necessary to ensure that the
non-discrimination tests set forth in paragraphs (a) and (b) of this Section
will be satisfied for the Plan Year.  For
purposes of this paragraph (e), Qualified Nonelective Contributions means
contributions made by the Employer, other than Employer Matching Contributions,
that (i) the Participant may not elect to have paid in cash or other benefits
instead of being contributed to the Plan, (ii) are designated by the Employer
as Qualified

 

56

 

Nonelective Contributions,
(iii) are allocated to a Participant’s Pre-Tax Contribution Account, and (iv)
are subject to all of the vesting and distribution requirements relating to
Pre-Tax Contributions under the terms of this Plan.

 

4.11                           (a)                                  Limitations
on Annual Additions. 
Not-withstanding any other provision of the Plan, the sum of Annual
Additions (as defined in paragraph (c)) to a Participant’s Account, when added
to the Annual Additions to the account of the Participant under any other
Defined Contribution Plan (as defined in paragraph (c)) maintained by the
Employer or a Related Company for any Limitation Year (as defined in paragraph
(c)), shall not exceed the lesser of (i) twenty-five percent (25%) of such
Participant’s Limitation Year Compensation (as defined in paragraph (c)), or
(ii) Thirty Thousand Dollars ($30,000), as adjusted pursuant to Section 415(d)
of the Code and any Treasury Regulations or other notices or rulings
promulgated thereunder.

 

57

 

(b)                                 Removal
of Excess Contributions.  In the
event the amount of Annual Additions made on behalf of a Participant during any
Limitation Year exceeds the maximum limitation on Annual Additions set forth in
paragraph (a), the following procedure shall be followed in order that such
excess amount shall not be deemed an Annual Addition for such Limitation Year:

 

(i)                                     If
the Participant with respect to whom the excess amount was allocated has made
Voluntary Contributions to a Defined Contribution Plan maintained by the
Employer for said Limitation Year, all or a portion of such Voluntary
Contributions (and any income attributable thereto) shall be returned to the
Participant in order to eliminate the excess amount.

 

(ii)                                  If
the Participant made no Voluntary Contributions to a Defined Contribution Plan
of the

 

58

 

Employer during the Limitation Year or, if after the return of
Voluntary Contributions under paragraph (i) above, an excess amount remains as
a result of a reasonable error in determining the amount of Pre-Tax
Contributions that the Participant could make under the limits set forth in
paragraph (a), Pre-Tax Contributions (and to the extent required by regulations
or rulings promulgated by the Department of the Treasury, any income
attributable thereto) sufficient to eliminate the excess amount shall be
distributed to the Participant.

 

(iii)                               If,
notwithstanding the procedures followed in paragraphs (i) and (ii) above, an
excess amount of Annual Additions remains allocated to a Participant’s Account
under this Plan, and such excess amount has resulted either from the allocation
of

 

59

 

forfeitures, a reasonable error in estimating such Participant’s
Compensation, or such other facts and circumstances which the Commissioner of
the Internal Revenue Service finds justify the utilization of the procedure
immediately following, Employer Discretionary Contributions or Employer
Matching Contributions on behalf of such Participant for the following
Limitation Year shall be reduced by the amount of such excess if the
Participant is entitled to such Contributions and is covered by the Plan at the
end of the next Limitation Year, and in the event that such Participant is not
covered by the Plan at the end of the next Limitation Year, such excess amounts
shall be held in an unallocated suspense account for such Limitation Year and
allocated to the Accounts of the remaining Participants (to the extent
permissible under this

 

60

 

Section 4.11) in proportion to their Compensation, determined as of the
end of such Limitation Year.  Such
allocation shall be made before any Employer Discretionary or Matching Contributions
may be made for such next Limitation Year. 
Furthermore, the excess amounts shall be used to reduce Employer
Discretionary or Matching Contributions for the next Limitation Year (and
succeeding Limitation Years, as necessary) for all of the remaining
Participants in the Plan.  For purposes
of this subparagraph (iii), excess amounts shall not be distributed to
Participants or former Participants.

 

(iv)                              If,
notwithstanding the procedures followed in paragraphs (i), (ii) and (iii)
above, an excess amount remains allocated to a Participant’s Account under this
Plan, such excess shall be considered a

 

61

 

contribution made by a mistake of fact and shall be returned to the
Employer in order to eliminate such excess.

 

(c)                                  Definitions.  For the purpose of this Section 4.11, the
following definitions shall apply:

 

(i)                                     Annual
Additions means the sum of the following:

 

(A)                              The
amount of Employer Matching Contributions, Employer Discretionary
Contributions, Pre-Tax Contributions (other than excess Pre-Tax Contributions
distributed pursuant to Section 4.1(b)) and any forfeitures allocated under
Section 6.4 to a Participant’s Account during a Limitation Year.

 

(B)                                The
amount of Employer Contributions, Pre-Tax Contributions and

 

62

 

forfeitures allocated to a Participant’s
account under any other Defined Contribution Plan during the Limitation Year.

 

(C)                                The
amount of Participant Voluntary Contributions allocated to a Participant’s
Account during the Limitation Year.

 

(D)                               Amounts
described in Sections 415(l)(1) and 419A(d)(2) of the Code.

 

Rollover Contributions and amounts
transferred under Section 4.12 shall not be counted as Annual Additions, nor
shall the earnings on such Contributions or amounts be counted as Annual
Additions.

 

(ii)                                  Defined
Contribution Plan means any plan described in Section 401(a) or 403(a) of
the Code which provides an individual account for each Participant and

 

63

 

under which benefits are based solely on
amounts (inclusive of forfeitures) contributed to the Participant’s account,
plus any income, expenses, gains and losses thereon.  For purposes of this Section 4.11, (A) all
Defined Contribution Plans, as defined herein, and (B) all defined contribution
plans described in Treasury Regulation Section 1.415-3(d)(2) (relating to
Voluntary Contributions to defined benefit plans) maintained by the Employer or
Related Companies, whether or not terminated, are to be treated as a Defined
Contribution Plan maintained by the Employer.

 

(iii)                               Limitation
Year means the Plan Year.

 

(iv)                              Limitation
Year Compensation means compensation within the meaning of Section
415(c)(3) of the Code (and the regulations promulgated thereunder) for the
Limitation Year.

 

64

 

4.12                           Rollover
Contributions.

 

(a)                                  If
an Employee (whether or not a Participant under this Plan) has received a
distribution from a retirement plan which meets the qualification requirements
of Section 401(a) of the Code (hereinafter referred to as the “Transferor Plan”),
such Employee may, in accordance with procedures established by the Committee,
roll over the distribution received from the Transferor Plan to this Plan,
provided the following conditions are met:

 

(i)                                     the
rollover occurs on or before the 60th day following his receipt of the
distribution from the Transferor Plan;

 

(ii)                                  the
rollover is in accordance with the applicable provisions of the Code; and

 

65

 

(iii)          the
amount rolled over is equal to all or a portion of an Eligible Rollover
Distribution, as defined in Section 7.10(a)(iv).

 

Such rolled over amount shall be allocated to the Employee’s Account hereunder
in the manner described in Section 4.13 as if said Employee were a Participant
hereunder.

 

(b)           `With respect to an
Employee (whether or not a Participant under this Plan) who has an
undistributed balance to his credit in a Transferor Plan (as described in
paragraph (a) above), the Committee may, in its sole discretion, approve a
direct transfer of such balance from such Transferor Plan to this Plan,
provided that the direct transfer shall satisfy the applicable requirements of
the Code.  Such transferred amount shall
be allocated to the Employee’s Account hereunder in the manner described in
Section 4.13 as if said Employee were a Participant hereunder.

 

66

 

4.13                           Rollover/Transfer
Procedures.  With respect to
rollovers or transfers to the Employee’s Account pursuant to Section 4.12, the
Committee shall develop such procedures and may require such information from
an Employee or the fiduciaries of the Transferor Plan desiring to make such a
rollover or transfer, as it deems necessary or desirable to determine that the
proposed rollover or transfer will meet the rollover or transfer requirements
under the Code.  Upon approval by the
Committee, the amount rolled over or transferred shall be deposited in the
Trust Fund and shall be credited to the applicable Account established in the
Employee’s name and administered in accordance with the provisions of Article
V.  Rollovers made pursuant to Section
4.12(a) shall be credited to the Employee’s Rollover Contribution Account.  Transfers made pursuant to Section 4.12(b)
shall be credited to the Employer’s Rollover Contribution Account, other than
amounts which are attributable to after-tax contributions

 

67

 

which shall be credited to the
Employee’s Voluntary Contribution Account.

 

4.14                           Transfer
to Other Qualified Plans.  In the
event of a restructuring or reorganization of the Employer or the sale of a
subsidiary or a division of the Employer pursuant to which Employees who are
Participants in the Plan become employed by the restructured or acquiring
entity, the Committee, upon the direction of the Board of Directors of Computer
Associates International, Inc. or the Executive Committee of such Board, and to
the extent permitted by law, shall transfer the Accounts of such Participants
to a plan maintained by the restructured or acquiring entity, provided such
plan meets the qualification requirements under Section 401(a) of the Code.

 

4.15                           Special
Rules Relating to Qualified Military Service.

 

Notwithstanding anything in this Plan to the contrary, if a Participant
is entitled to the reemployment

 

68

 

benefits of USERRA resulting
from Qualified Military Service with respect to this Plan, then the following
shall apply:

 

(a)                                  (i)                                     Such
Participant shall, upon reemployment pursuant to USERRA, be permitted to make
additional Pre-Tax Contributions (in the amount determined under subparagraph
(ii) below or such lesser amount as is elected by the Participant pursuant to
the Plan) during the period which begins on the date of reemployment of such
Participant by the Employer and has the same length as the lesser of (A) the
product of three (3) and the period of Qualified Military Service which
resulted in such rights and (B) five (5) years.

 

(ii)                                  The
amount of additional Pre-Tax Contributions which can be made under subparagraph
(i) above shall be the maximum amount of Pre-Tax Contributions that such
Participant would have been permitted to make under the

 

69

 

Plan during the period of Qualified Military Service if the Participant
had continued to be employed by the Employer during such period and received
Compensation, as determined under paragraph (d) below.  Proper adjustments shall be made to the
amount determined hereunder for any Pre-Tax Contributions actually made during
the period of such Qualified Military Service.

 

(iii)                               The
provisions set forth above shall also apply with respect to Voluntary
Contributions.

 

(b)                                 The
Employer shall make Matching Contributions on behalf of such Participant with
respect to any additional Pre-Tax Contributions actually made pursuant to
paragraph (a) above which would have been required had such Pre-Tax Contributions
actually been made during the period of such Qualified Military Service.

 

70

 

(c)                                  Each
period of a Participant’s Qualified Military Service shall, upon reemployment
by the Employer under USERRA, be taken into consideration for the purpose of
determining whether the Participant was employed at the end of a Plan Year and
eligible to receive an allocation of any Employer Discretionary Contributions
for the particular Plan Year pursuant to Section 4.6(b).

 

(d)                                 For
purposes of this Section 4.15 and Section 4.11, a Participant who is in
Qualified Military Service shall be treated as receiving Compensation from the
Employer during such period of Qualified Military Service equal to

 

(i)                                     the
Compensation the Participant would have received during such period if the
Participant were not in Qualified Military Service, determined based on the
rate of pay the Participant would have

 

71

 

received from the Employer but for absence during the period of
Qualified Military Service, or

 

(ii)                                  if
the Compensation the Participant would have received during such period is not
reasonably certain, the Participant’s average Compensation from the Employer
during the twelve (12) month period immediately preceding the Qualified
Military Service (or if shorter, the period of employment immediately preceding
the Qualified Military Service).

 

(e)                                  Nothing
in this Section 4.15, the Plan, or USERRA, shall require the crediting of any
earnings to a Participant with respect to any Contribution before such
Contribution is actually made, or any allocations of forfeitures with respect
to the period of Qualified Military Service.

 

(f)                                    Any
Pre-Tax, Voluntary, Matching or Discretionary Contributions that are made due
to the requirements

 

72

 

of USERRA shall not be subject
to any otherwise applicable limitation contained in Section 4.1 or 4.11, or
Section 404(a) of the Code, and shall not be taken into account in applying
such limitations with respect to the year in which the contribution is made,
but shall be subject to such limitations with respect to the year to which the
Contribution relates (in accordance with rules prescribed by the Secretary of the
Treasury).  In addition, the Plan shall
not be treated as failing to meet the requirements of Section 401(a)(4),
401(k), 401(m), 410(b), or 416 of the Code by reason of the making of (or the
right to make) such Contributions.

 

73

 

ARTICLE V

PARTICIPANTS’ ACCOUNTS

 

5.1                                 Separate
Accounts.  The following separate
accounts shall be maintained for each Participant, if applicable:

 

(a)                                  Pre-Tax
Contributions made pursuant to Section 4.1;

 

(b)                                 Employer
Matching Contributions made pursuant to Section 4.4;

 

(c)                                  Employer
Discretionary Contributions made pursuant to Section 4.5;

 

(d)                                 Voluntary
Contributions, if any, made pursuant to Section 4.7; and

 

(e)                                  Rollover
Contributions, if any, made pursuant to Section 4.12.

 

Such accounts shall be referred to respectively as the “Pre-Tax
Contribution Account,” the “Employer Matching Contribution Account,” the “Employer
Discretionary Contribution Account,” the “Voluntary Contribution Account” and
the “Rollover

 

74

 

Contribution Account,” and
shall be referred to collectively as the “Account.”

 

5.2                                 Allocation
of Contributions.

 

(a)                                  Any
Pre-Tax Contributions, Employer Matching Contributions and Voluntary
Contributions which are deposited into the Trust Fund in accordance with
Section 4.9(c) shall be credited to Participants’ Accounts within the Plan Year
in which they are contributed in a manner determined by the Committee.

 

(b)                                 Any
Employer Discretionary Contributions which are deposited into the Trust Fund
for any Plan Year in accordance with Section 4.9(c) shall be credited to
eligible Participants’ Employer Discretionary Contribution Accounts for the
respective Plan Year in accordance with Section 4.6.

 

75

 

5.3                                 Allocation
of Net Income or Net Loss.

 

(a)                                  At
each Valuation Date, each Pre-Tax Contribution Account, Employer Matching
Contribution Account, Employer Discretionary Contribution Account, Voluntary
Contribution Account and Rollover Contribution Account shall be credited or
charged with that portion of the Net Income or Net Loss of the respective
investment funds in which said Accounts are invested pursuant to Section 10.4
and Article XI, for such Date which bears the same ratio to such Net Income or
Net Loss as the value of such Account, determined at the preceding Valuation
Date, bears to the value of all such Accounts within each respective fund,
determined at such preceding Valuation Date.

 

(b)                                 For
purposes of this Section, the term “Net Income” means the excess, if any, of
income and gains of the Trust for the Valuation Date over the expenses and
losses of the Trust for such Date and the term “Net Loss” means the excess,

 

76

 

if any, of expenses and losses
for such Valuation Date over income and gains for such Date.

 

(c)                                  Notwithstanding
paragraphs (a) and (b) above, the amount of any Net Income or Net Loss
attributable to the General Account (as described under Section 5.1 of the Plan’s
Trust Agreement entered into between the Company and the Trustees, as amended
and in effect prior to March 31, 1993) maintained under the Trust shall be
credited or charged, as the case may be, to such General Account.

 

77

 

ARTICLE VI

VESTING

 

6.1                                 Vesting
of Pre-Tax, Voluntary and Rollover Contribution Accounts.  A Participant’s Pre-Tax Contribution Account,
Voluntary Contribution Account and Rollover Contribution Account shall be 100%
vested at all times.

 

6.2                                 Vesting
of Employer Matching and Discretionary Contribution Accounts.

 

(a)                                  (i)                                     Except
as otherwise provided herein and in paragraphs (b) and (c) below, the Employer
Matching Contribution Account and Employer Discretionary Contribution Account
of a Participant who completes one (1) Hour of Service on or after January 1,
1989 shall become vested in accordance with the following schedule:

 

	
  Years of Service

  	
   

  	
  Vested Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 3

  	
   

  	
  0

  	
  %

  
	
  3 but less than 4

  	
   

  	
  20

  	
  %

  
	
  4 but less than 5

  	
   

  	
  40

  	
  %

  
	
  5 but less than 6

  	
   

  	
  60

  	
  %

  
	
  6 but less than 7

  	
   

  	
  80

  	
  %

  
	
  7 or more

  	
   

  	
  100

  	
  %

  

 

78

 

(ii)                                  In
no event shall such Participant’s vested right to his Employer Matching
Contribution Account or Employer Discretionary Contribution Account on or after
January 1, 1989 be less than such Participant’s vested right to his Employer
Matching Contribution Account or Employer Discretionary Contribution Account
determined as of December 31, 1988 in accordance with the vesting schedule set
forth in the Plan as of such date.

 

(b)                                 Upon
the attainment by a Participant of Normal Retirement Age while employed by the
Employer, or upon termination of employment by reason of death or Disability,
such Participant shall become one hundred percent (100%) vested in his Employer
Matching Contribution Account and Employer Discretionary Contribution Account.

 

(c)                                  In
the event that:

 

79

 

(i)                                     the
Plan shall be terminated either wholly or partially; or

 

(ii)                                  the
Employer shall completely discontinue contributions to the Plan, each
Participant affected by such termination or discontinuance of contributions
shall become one hundred percent (100%) vested in his Employer Contributions
Account.

 

6.3                                 Years
of Service.  For the purpose of
Section 6.2 above, Years of Service means the number of whole years of an
Employee’s Period of Service; provided, however, that each period of Qualified
Military Service served by a Participant shall, upon reemployment under USERRA,
be deemed to constitute service for the purpose of determining Years of Service
hereunder.  Except as otherwise provided
in Section 1.19, in determining the number of whole years of an Employee’s
Period of Service for the purpose of this Section 6.3, all Periods of Service
shall be aggregated and

 

80

 

365 days of service shall be
considered to be a whole Year of Service. 
After determining an Employee’s whole Years of Service for the purpose
of Section 6.2, any remaining less than 365-day Period of Service shall be
disregarded.

 

6.4                                 Forfeitures.

 

(a)                                  In
the event that a Participant is not vested in all or a portion of his Employer
Matching Contribution Account or Employer Discretionary Contribution Account
upon his termination of employment with the Employer, the unvested portion of
such Accounts shall be forfeited as of the earlier of (i) the date such
Participant receives a distribution of his vested Account pursuant to the
provisions of Article VII or (ii) the date such Participant incurs five (5)
consecutive One Year Breaks-in-Service. 
For purposes of this Section, if a Participant terminates employment and
has a zero percent (0%) vested interest in his Employer Matching Contribution
Account or

 

81

 

Employer Discretionary
Contribution Account, such Participant shall be deemed to have received a
distribution of his vested Employer Matching Contribution Account and Employer
Discretionary Contribution Account as of the date of his termination of
employment.

 

(b)                                 (i)                                     If
a forfeiture occurs pursuant to paragraph (a)(i) above, the amount of such
forfeiture shall be restored to the Participant’s Employer Matching
Contribution Account or Employer Discretionary Contribution Account, as applicable,
only if such Participant is reemployed by the Employer prior to incurring five
(5) consecutive One Year Breaks-in-Service and repays to the Plan the full
amount of the distribution attributable to his Employer Matching Contribution
Account and Employer Discretionary Contribution Account, as applicable, prior
to the fifth (5th) anniversary of his reemployment date.  If a Participant shall be deemed to have

 

82

 

received a distribution of his
Employer Matching Contribution Account or Employer Discretionary Contribution
Account pursuant to paragraph (a) above, the forfeiture shall be restored to
such Participant’s Employer Matching Contribution Account or Employer
Discretionary Contribution Account, as applicable, if the Participant is
reemployed by the Employer prior to incurring five (5) consecutive One Year
Break-in-Service.

 

(ii)                                  Restored
forfeitures shall be credited to the Participant’s Employer Matching
Contribution Account or Employer Discretionary Contribution Account, as
applicable, no later than the Valuation Date next following the later to occur
of (A) the Participant’s reemployment date, or (B) the date upon which the
Participant’s repayment to his Employer Matching Contribution Account and
Employer Discretionary Account is made, whichever of (A) or (B) is
applicable.  Funds for restoration shall
be taken from current forfeitures.  To
the extent such

 

83

 

current forfeitures are
inadequate, additional contributions shall be made by the Employer for this
purpose.

 

(c)                                  Forfeitures
shall be applied according to the following priority schedule:

 

(i)                                     First,
to make restoration of prior forfeitures pursuant to paragraph (b) above;

 

(ii)                                  Second,
if funds remain, to defray administrative costs of the Plan as determined by
the Committee;

 

(iii)                               Third,
if funds remain, to the Matching Contribution Accounts of remaining active
Participants in lieu of Matching Contributions which otherwise would have been
made on or after the date of the forfeiture.

 

(iv)                              Fourth,
if funds remain, in lieu of any portion as determined by the Committee, of any
Employer Discretionary Contributions which

 

84

 

otherwise would have been made on or after the date of the forfeiture.

 

85

 

ARTICLE VII

DISPOSITION OF
VESTED INTERESTS IN ACCOUNTS

 

7.1                                 Disposition
on Termination of Employment.  Each
Participant, upon termination of employment with the Employer, shall be
entitled to a distribution of his vested Account balance in such manner and at
such time as described hereinafter.

 

7.2                                 Methods
of Distribution.

 

(a)                                  Except
as otherwise provided in paragraph (b) below, distribution of amounts payable
under Section 7.1 shall be made, at the election of the Participant, in a lump
sum.

 

(b)                                 Notwithstanding
anything in this Article to the contrary, in the event the Participant’s entire
vested Account balance does not exceed $5,000, the Committee shall pay the
Participant a lump sum as soon as practicable following the Participant’s
termination of employment.

 

86

 

7.3                                 Timing
of Distributions.

 

(a)                                  Except
as otherwise provided in paragraph (b) below, Section 7.2(b) and Section 7.7, a
Participant may elect to commence the distribution of his vested Account
balance under Section 7.1 at any time after his termination of employment.

 

(b)                                 Notwithstanding
anything in this Section to the contrary, in no event shall a Participant’s
vested Account be distributed to the Participant prior to his Normal Retirement
Age if the Participant:

 

(i)                                     has
committed any act of fraud, misconduct, proven dishonesty, theft or crime
against the Employer or willful damage or injury to the property, business or
good will of the Employer, or

 

(ii)                                  has
engaged, or continues to engage, in conduct prejudicial or detrimental to the
Employer’s interest by (A) taking any action, directly or indirectly, alone or
through association with other individuals or organizations, which results or
is intended to result in economic loss to the Employer,

 

87

 

(B)                                taking
any action, directly or indirectly, alone or through association with other
individuals, which is in competition with the business of the Employer, or (C)
taking, making use of, or divulging the confidential information or trade
secrets acquired while in the employ of the Employer, including but not limited
to, its customer lists, files and records.

 

7.4                                 Disposition
Upon Death.

 

(a)                                  In
the event of the death of a Participant prior to the payment of benefits
hereunder, the Participant’s vested Account balance shall be paid in a lump sum
to the Beneficiary designated by the Participant in accordance with the
provisions of Section 7.5.

 

(b)                                 In
the event the designated Beneficiary dies prior to receiving the deceased
Participant’s vested Account

 

88

 

under paragraph (a) above, such
vested Account shall be distributed to the estate of the designated Beneficiary
as soon as practicable following such Beneficiary’s death.

 

(c)                                  The
Committee shall pay any death benefit hereunder as soon as practicable
following the Participant’s date of death, except as may otherwise be provided
in Section 7.8.

 

7.5                                 Designation
of Beneficiary.

 

(a)                                  A
Participant may designate one or more individuals or one or more entities to
receive the amounts payable pursuant to Section 7.4.  Any such designation shall be written, signed
by the Participant on a form approved by the Committee, and shall be effective
upon delivery to the Committee.  Any such
designation and all subsequent designations may be revoked at any time by
delivery to the Committee of another designation, executed in the same manner,
which shall become effective upon the same terms and conditions.  Notwithstanding

 

89

 

anything herein or in the Plan
to the contrary, nothing contained in this Section or the Plan shall require
the Committee to permit the designation of contingent Beneficiaries.

 

(b)                                 (i)                                     If
a Participant is married at the time of his death, his spouse shall be deemed
to be his primary designated Beneficiary unless he designates someone other
than his spouse as Beneficiary and his spouse consents, in writing, to such
other designation.  Such spousal consent
shall (A) acknowledge the effect of such designation on the spouse’s rights to
benefits under the Plan, (B) acknowledge the specific non-spouse Beneficiary,
if any, designated by the Participant, including any class of Beneficiaries or
contingent Beneficiaries, which designations may not be changed without the
spouse’s consent, and (C) be witnessed by a notary public. Not-withstanding
anything herein to the contrary, the Committee may, in its discretion which shall
be applied in a uniform and

 

90

 

nondiscriminatory manner,
permit the spouse’s consent hereunder to expressly permit changes in the
Beneficiary designation by the Participant without any requirement of further
consent by the spouse.

 

(ii)                                  Notwithstanding
the provisions of subparagraph (i) above, spousal consent to a designation of a
Beneficiary other than the spouse or to a subsequent change in Beneficiary
shall not be required if it is established to the satisfaction of the Committee
that such spousal consent cannot be obtained because (A) there is no spouse,
(B) the spouse cannot be located, (C) the Participant is legally separated or
has been abandoned (within the meaning of local law) and the Participant has a
court order to such effect, or (D) of such other circumstances as the Secretary
of the Treasury may, by regulations or otherwise, prescribe.  In the event the Participant’s spouse is
legally incompetent to give such spousal

 

91

 

consent hereunder, the spouse’s
legal guardian, even if such guardian is the Participant, may give such
consent.  A former spouse’s consent shall
not be binding on a new spouse.

 

(c)                                  In
the event of the death of a Participant who shall have no surviving Beneficiary
pursuant to a Beneficiary designation in effect, and who shall have no
surviving spouse, the estate of the Participant shall be the Beneficiary of
such Participant, and distribution of the amounts credited to the vested
Account of such Participant shall be made in such manner as described in
Section 7.4.

 

(d)                                 Notwithstanding
anything in the Plan to the contrary, the rights of any spouse or Beneficiary
hereunder shall be extinguished to the extent that such rights are in conflict
with the provisions of any domestic relations order which is a “Qualified
Domestic Relations Order” within the meaning of Section 206(d)(3)(A) of ERISA.

 

92

 

7.6                                 Notification.  The Committee shall provide each Participant
who terminates employment with the Employer and whose vested Account exceeds
$5,000, with a notice of distribution no later than thirty (30) days and no
more than ninety (90) days prior to the scheduled date of distribution,
informing the Participant of his right to defer the commencement of his
distribution.  If the distribution is one
to which Sections 401(a)(11) and 417 of the Code do not apply, such
distribution may commence less than thirty (30) days after such notice is
provided by the Committee, provided that the notice clearly informs the
Participant of his right to a period of at least thirty (30) days after
receiving the notice to consider the decision of whether or not to elect a
distribution, and the Participant, after receiving the notice, affirmatively
elects a distribution. Notwithstanding anything herein to the contrary, except
as provided in Sections 7.7 and 10.1(k), (a) no benefit

 

93

 

shall be payable under the Plan
to any Participant or Beneficiary hereunder unless and until such Participant
or Beneficiary shall submit a written application therefor, on a form provided
by the Committee, specifying the method in which such benefit is to be paid,
and (b) in the event that there shall be a change in the investment funds
available to Participants pursuant to Section 11.1 or a change in the Plan
Trustee, distributions under the Plan may be suspended to the extent necessary
to accomplish such changes.

 

7.7                                 Required
and Minimum Distribution Rules.

 

(a)                                  Unless
a Participant elects otherwise, the distribution of such Participant’s vested
Account shall commence no later than sixty (60) days after the close of the
Plan Year during which occurs the latest of the following:

 

94

 

(i)                                     the
Participant’s attainment of the earlier of age sixty-five (65) or his Normal
Retirement Age;

 

(ii)                                  the
tenth (10th) anniversary of the Participant’s entry into the Plan; or

 

(iii)                               the
Participant’s separation from service with the Employer.

 

For purposes of this Section, a Participant shall be deemed to have
elected otherwise if the Participant does not make an election to commence the
distribution of his vested Account under Section 7.1 by his Required Beginning
Date as defined in Section 7.7(c).

 

(b)                                 Notwithstanding
anything in this Plan to the contrary, all distributions made pursuant to the
provisions of this Article and Article XIII shall be in accordance with the
provisions of Section 401(a)(9) of the Code and the Treasury

 

95

 

Regulations promulgated
thereunder, including the minimum distribution incidental benefit requirement
of Section 1.401(a)(9)-2 of said Regulations. 
The aforesaid provisions and the provisions of this Section 7.7 shall
take precedence over any inconsistent provisions set forth in this Plan.

 

(c)                                  Notwithstanding
anything in this Plan to the contrary, the distribution of a Participant’s vested
Account hereunder shall commence no later than April 1st of the calendar year
following the later of (i) the calendar year in which the Participant attains
age seventy and one-half (70-1/2) or (ii) the calendar year in which the
Participant terminates employment (the “Required Beginning Date”); provided,
however, that clause (ii) shall not apply to a Participant who is a five
percent (5%) owner (as defined in Section 416(i) of the Code) with respect to
the Plan Year ending in the calendar year in which he attains age seventy and
one-half (70-1/2).

 

96

 

(d)                                 The
following minimum distribution rules shall apply with respect to a Participant’s
vested Account on or after the Participant’s Required Beginning Date:

 

(i)                                     The
amount required to be distributed for each calendar year, beginning with
distributions for the first Distribution Calendar Year and each succeeding
Distribution Calendar Year (as defined in subparagraph (v) below), shall be no
less than the quotient obtained by dividing the Participant’s Benefit (as
defined in subparagraph (v) below) by the Applicable Life Expectancy (as
defined in subparagraph (v) below).

 

(ii)                                  Notwithstanding
anything herein to the contrary, for calendar years beginning before January 1,
1989, if the Participant’s spouse is not the Participant’s designated
Beneficiary, the present value of any installment benefits payable to the
Participant shall be greater than fifty (50%) percent of the

 

97

 

present value of the total installment benefits payable to the
Participant and his designated Beneficiary.

 

(iii)                               Notwithstanding
anything herein to the contrary, for calendar years beginning after December
31, 1988, the amount to be distributed during each Distribution Calendar Year,
beginning with distributions for the first Distribution Calendar Year, shall
not be less than the quotient obtained by dividing the Participant’s Benefit by
the lesser of (A) the Applicable Life Expectancy or (B) if the Participant’s
spouse is not the designated Beneficiary, the applicable divisor determined
from the table set forth in Q&A-4 of Section 1.401(a)(9)-2 of the Treasury
Regulations.  Distributions subsequent to
the death of the Participant shall be determined using the Applicable Life Expectancy
as the relevant divisor

 

98

 

without regard to Section 1.401(a)(9)-2 of the Treasury Regulations.

 

(iv)                              The
minimum distribution required for the Participant’s first Distribution Calendar
Year shall be made on or before the Participant’s Required Beginning Date.  The minimum distribution for other
Distribution Calendar Years, including the minimum distribution for the
Distribution Calendar Year in which the Participant’s Required Beginning Date
occurs, shall be made on or before December 31 of that Distribution Calendar
Year.

 

(v)                                 For
the purpose of this paragraph (d), the following definitions shall apply:

 

(A)                              (1)                                  Applicable
Life Expectancy means the Life Expectancy (or joint and last survivor
expectancy) calculated by using the attained age of the Participant (and
designated Beneficiary, if applicable) as of the Participant’s (and

 

99

 

designated Beneficiary’s, if applicable) birthday(s) in the applicable
calendar year, reduced by one for each calendar year which has elapsed since
the date on which Life Expectancy (or joint and last survivor expectancy) was
first calculated; provided, however, that if Life Expectancy is being
recalculated pursuant to subparagraph (2) below, the Applicable Life Expectancy
shall be the Life Expectancy so recalculated. 
The applicable calendar year shall be the first Distribution Calendar
Year; provided, however, that if Life Expectancy (or joint and last survivor
expectancy of the Participant and his spouse) is being recalculated pursuant to
subparagraph (2) below, the applicable calendar year shall be each succeeding
calendar year.

 

(2)                                  Notwithstanding
anything hereinbefore to the contrary, a Participant may make a written
election no later than his Required Beginning Date, on the appropriate form
provided by the Committee, to have the permissive

 

100

 

recalculation rule set forth under Section 401(a)(9)(D) of the Code and
the Treasury Regulations promulgated thereunder apply with respect to the
determination of his Life Expectancy (and/or the Life Expectancy of his spouse,
if applicable).  Such election shall
become irrevocable as of the Participant’s Required Beginning Date.  If the Participant fails to make such
election, the Life Expectancy of the Participant (and his spouse, if
applicable) shall be determined without regard to such provisions.

 

(B)                                Distribution
Calendar Year means a calendar year for which a minimum distribution is required.  Except as otherwise provided under the
Treasury Regulations promulgated under Section 401(a)(9) of the Code, the
first Distribution Calendar Year shall be the calendar year

 

101

 

immediately preceding the calendar year which contains the Participant’s
Required Beginning Date.

 

(C)                                Life
Expectancy means the life expectancy or the joint and last survivor expectancy,
as applicable, computed by use of the expected return multiples in Tables V and
VI of Section 1.72-9 of the Treasury Regulations.

 

(D)                               Participant’s
Benefit means the Participant’s Account as of the last Valuation Date in the
calendar year immediately preceding a Distribution Calendar Year (the “Valuation
Calendar Year”), increased by the amount of any contributions or forfeitures
allocated to said Account during the Valuation Calendar Year after the
Valuation Date and decreased by distributions

 

102

 

made during the Valuation Calendar Year after the Valuation Date.  For purposes of the preceding sentence, if
any portion of the minimum distribution for the first Distribution Calendar
Year is made in the second Distribution Calendar Year on or before the Participant’s
Required Beginning Date, the amount of the minimum distribution made in the
second Distribution Calendar Year shall be treated as if it had been made in
the immediately preceding Distribution Calendar Year.

 

7.8                                 Required
Distribution of Death Benefits.

 

Notwithstanding anything in this Article to the contrary, if a
Participant’s date of death occurs prior to his Required Beginning Date (as
described in Section 7.7(c)), the distribution of his vested Account shall be
completed by December 31 

 

103

 

of the calendar year which
contains the fifth anniversary of the Participant’s date of death.

 

7.9                                 Valuation
of Distributions.  A Participant’s
vested Account balance to be distributed pursuant to Section 7.1 or Section 7.4
of this Article VII or pursuant to any other provision under this Plan, shall
be determined as of the Valuation Date immediately preceding the date of
distribution.  For purposes of this
Section 7.9, the date of distribution shall be the date the Trustee liquidates
the assets in the vested Account of the Participant in order to effectuate the
distribution of said vested Account.

 

7.10                           Direct
Rollover of Eligible Rollover Distributions.

 

(a)                                  For
the purpose of this Section 7.10, the following definitions shall apply:

 

104

 

(i)                                     Direct
Rollover means a direct trustee-to-trustee transfer to the Eligible
Retirement Plan so specified by the Distributee.

 

(ii)                                  Distributee
means (A) a Participant, (B)                                a
Participant’s surviving spouse, or (C) a Participant’s spouse or former spouse
who is an alternate payee pursuant to a “Qualified Domestic Relations Order” as
described in Section 9.3(b).

 

(iii)                               Eligible
Retirement Plan means (A) an individual retirement account described in
Code Section 408(a), (B) an individual retirement annuity described in Code
Section 408(b), other than an endowment contract, (C) a defined contribution
plan which is qualified under Code Section 401(a), the terms of which permit the

 

105

 

acceptance of rollover distributions, or (D) an annuity plan described
in Code Section 403(a).

 

(iv)                              Eligible
Rollover Distribution means any distribution from the Plan to a
Distributee, except that such term shall not include (A) any portion of a
distribution which is attributable to Voluntary Contributions, (B) any
distribution to the extent such distribution is required under Section 7.7, and
(C) any hardship distribution made from a Participant’s Pre-Tax Contribution
Account under Section 8.1(b).

 

(b)                                 Except
as otherwise provided in this Section, if the Distributee of any Eligible
Rollover Distribution elects to have such Distribution paid directly to an
Eligible Retirement Plan and specifies the Eligible Retirement Plan to which
such Distribution is to be paid (in such form and at such time as the

 

106

 

Committee may prescribe), such Distribution shall be made in the form
of a Direct Rollover.

 

(c)                                  A
Distributee may elect to have a portion of an Eligible Rollover Distribution
paid to an Eligible Retirement Plan in a Direct Rollover and to have the
remainder of said Distribution paid to the Distributee.

 

(d)                                 A
Distributee’s election to make or not make a Direct Rollover with respect to
one payment in a series of periodic payments shall apply to all payments in the
series, provided that

 

(i)                                     the
Distributee is permitted at any time to change, with respect to subsequent
payments, a previous election to make or not make a Direct Rollover; and

 

(ii)                                  the
written explanation provided pursuant to Code Section 402(f) explains that the

 

107

 

election to make or not make a Direct Rollover will apply to all future
payments unless the Distributee subsequently changes the election.

 

(e)                                  The
Committee may, pursuant to regulations and rulings promulgated by the Secretary
of the Treasury, establish procedures for the purpose of carrying out the
provisions of this Section 7.10, including establishing any reasonable
procedure for the Distributee to elect a Direct Rollover, establishing a
default procedure, establishing a deadline or time period after which the
Distributee may not revoke an election to make or not make a Direct Rollover,
and limiting the Distributee to a single Direct Rollover for each Eligible
Rollover Distribution.

 

108

 

ARTICLE VIII

IN-SERVICE
WITHDRAWALS AND LOANS

 

8.1                                 Withdrawals
From Participants’ Accounts.

 

(a)                                  Withdrawals
from Voluntary Contribution Account. 
A Participant who has not terminated employment with the Employer may,
at any time, upon written notice to the Committee, signed and acknowledged by
the Participant, elect to withdraw all or part of his Voluntary Contribution
Account.

 

(b)                                 Age
59-1/2 and Hardship Withdrawals from Other Accounts.

 

(i)                                     A
Participant who has not terminated employment with the Employer may request, at
any time on or after the attainment of age fifty-nine and one-half (59-1/2),
upon written notice to the Committee, the withdrawal of additional amounts from
his Account.

 

(ii)                                  (A)                              A
Participant who has not attained age 59-1/2 and has not terminated employment
with the Employer may

 

109

 

request, upon written notice to the Committee, signed and acknowledged
by the Participant, the withdrawal of additional amounts from his Account,
which shall only be permitted if the Committee finds that such withdrawal is
required by the Participant for the purpose of satisfying any of the following
financial needs:

 

(1)                                  medical
expenses incurred by the Participant or a member of his immediate family;

 

(2)                                  purchase
or preservation of the primary residence of the Participant;

 

(3)                                  educational
expenses of the Participant or a member of his immediate family; or

 

(4)                                  effective
commencing July 1, 2001, prevention of the eviction of the Participant

 

110

 

from the Participant’s principal residence or foreclosure on the
mortgage on such residence.

 

(B)                                Withdrawals
pursuant to this Section 8.1(b)shall be made from the Participant’s Account as
follows:

 

FIRST:           From
the Participant’s Pre-Tax Contribution Account; provided, however, that with
respect to a Participant who has not attained age fifty-nine and one-half, the
following conditions and limitations shall apply to withdrawals from the
Pre-Tax Contribution Account:

 

(1)                                  Such
withdrawals shall not include any gains or earnings of the Trust allocated to
such Participant’s Pre-Tax Contribution Account subsequent to March 31, 1989.

 

111

 

(2)                                  Such
withdrawals shall only be permitted if all of the following requirements are
satisfied:

 

(a)                                  The
withdrawal shall not exceed the amount required by the Participant to satisfy
the financial need set forth in paragraph (ii)(A) above.

 

(b)                                 The
Participant has obtained all other distributions under Section 8.1 (a)relating
to Voluntary Contributions.

 

(c)                                  The
Participant has obtained all nontaxable (at the time of the loan) loans from
the Plan, unless the Participant’s financial need cannot reasonably be relieved
by obtaining such loans.

 

112

 

(d)                                 The
Participant acknowledges in writing to the Committee, on such form as it shall
require, that the financial need as set forth in paragraph (ii)(A) above cannot
reasonably be relieved:

 

(i)                                     through
reimbursement or compensation by insurance or otherwise;

 

(ii)                                  by
liquidation of the Participant’s assets, which shall be deemed to include those
assets of the Participant’s spouse and minor children that are reasonably
available to the Participant;

 

(iii)                               by
cessation of the Participant’s Pre-Tax and Voluntary Contributions;

 

(iv)                              by
nontaxable (at the time of the loan) loans or other distributions or
non-taxable loans from qualified plans of any other employer; or

 

113

 

(v)                                 by
borrowing from commercial sources on reasonable commercial terms in an amount
necessary to satisfy the financial need.

 

For purposes of this subparagraph (d), a financial need cannot
reasonably be relieved by one of the actions set forth above if the effect of
such action would be to increase the Participant’s financial need.  In no event may the Committee rely upon the
Participant’s written representations as described above if the Committee has
actual knowledge that the Participant’s financial need can reasonably be
relieved by one of the actions set forth above.

 

114

 

SECOND:                    From
the Participant’s Rollover Contribution Account, if any, but not including any
portion of such Account which is allocated to a Participant’s Joint and Survivor
Annuity Account (as described in Section 13.3).

 

THIRD:                               From
the Participant’s Employer Contribution Account, to the extent of the
Participant’s vested interest in such Account. 
Employer Contribution Account means the Participant’s Employer Matching Contribution
Account and Employer Discretionary Contribution Account.

 

FOURTH:                   From
the Joint and Survivor Annuity Account (as described in Section 13.3), if any,
of a Participant who is a Transferred Employee (as defined in Section 13.1(d));
provided, however, that in no event shall a withdrawal of any portion of such
Account

 

115

 

be permitted unless such Transferred Employee’s
spouse, if any, consents to such withdrawal within the ninety (90) day period
prior to said withdrawal.  Such spousal
consent shall be given in the manner described in Section 13.5(c)(iii).  Notwithstanding anything herein to the
contrary, effective for the Plan Year commencing March 31, 1999 and for all
Plan Years thereafter, in no event shall any withdrawals hereunder be permitted
with respect to any portion of a Participant’s Joint and Survivor Annuity
Account, if any, which is attributable to amounts transferred, within the
meaning of Section 414(l) of the Code, to the Plan from a money purchase
pension plan qualified under Section 401(a) of the Code (other than any portion
of such transferred amounts attributable to voluntary after-tax contributions).

 

116

 

(c)                                  Any
request for a withdrawal under this Section 8.1 must be made in writing by the
Participant on such forms as are provided by the Committee, and shall be
supported by any information which the Committee requests from the Participant.

 

(d)                                 Notwithstanding
anything herein to the contrary, in the event that there shall be a change in
the investment funds available to Participants pursuant to Section 11.1 or a
change in the Plan Trustee, withdrawals under this Section 8.1 may be suspended
to the extent necessary to accomplish such changes.

 

8.2                                 Loans
to Participants.

 

(a)                                  Any
Participant, other than a Participant who has terminated employment with the
Employer, may take a loan from his Account; provided, however, that in the
event that there shall be a change in the investment funds available to Participants
pursuant to Section 11.1 or a change in the Plan Trustee, loans under this
Section 8.2 may be suspended to the

 

117

 

extent necessary to accomplish
such changes.  A request for a loan shall
be made on a loan application form to be provided by the Committee.

 

(b)                                 In
no event shall the total of any such loan or loans with respect to any
Participant under all plans of the Employer exceed the lesser of (i) Fifty
Thousand Dollars ($50,000), reduced by the excess (if any) of the highest
outstanding balance of loans from such plans during the one (1) year period
ending on the day before the date on which such loan is made, over the
outstanding balance of loans from such plans on the date on which such loan is
made, or (ii) one-half the value of the Participant’s vested Account balance as
of the most recent Valuation Date during the twelve (12) month period
immediately preceding the issuance of the loan, provided such valuation is
adjusted for any distributions or Contributions made after such

 

118

 

Valuation Date; provided,
however, that no loan granted shall be less than One Thousand Dollars ($1,000).

 

(c)                                  In
no event may a Participant have more than two (2) loans outstanding at any time
under the Plan.

 

(d)                                 The
rate of interest on loans to Participants shall be at a reasonable rate fixed
by the Committee at the time the loan is approved.  Such rate shall provide the Trust with a
return commensurate with the interest rates charged by persons in the business
of lending money for loans which would be made under similar circumstances.

 

(e)                                  All
loans shall be repaid at least quarterly in substantially equal installments of
both principal and interest, either through payroll deduction or such other
method as may reasonably be selected by the Committee; provided, however, that
any method selected shall be sufficient to fully amortize the loan within the
repayment period.  All such

 

119

 

repayments shall be credited to the Participant’s Account.  The maximum repayment period of a loan to a
Participant shall be five (5) years.  The
term of the loan shall be arrived at by the Committee pursuant to a uniform,
nondiscriminatory policy.

 

(f)                                    Each
loan shall be supported by collateral which shall consist of the assignment of
no more than fifty percent (50%) of the Participant’s vested Account in the
Trust; provided, however, that the Committee shall require such additional
collateral as the Committee may deem necessary in order to adequately secure
the loan and insure against a loss to the Plan.

 

(g)                                 Upon
the death, retirement or termination of employment of the Participant, the
Committee may deduct the total unpaid balance of any such outstanding loan or
any portion thereof from any payment or distribution to which such Participant
or his Beneficiary or Beneficiaries may be entitled.

 

120

 

(h)                                 Each
Participant to whom a loan is granted under this Section 8.2 shall be required
to execute a promissory note payable to the Trustee.  Such promissory note shall be in the form
provided by the Committee and shall set forth the material terms of the
loan.  Every loan applicant shall receive
a clear statement of the material terms of each loan transaction.

 

(i)                                     (A)                              If
a Participant (1) defaults on the payment of a loan and such default continues
for sixty (60) days, or (2) in the event of the Participant’s bankruptcy,
impending bankruptcy, insolvency, or impending insolvency, the Committee shall
issue a written notice of default to the Participant, in which case the entire
unpaid loan balance shall become due and payable.  The Committee may pursue collection of the
unpaid loan balance, plus accrued but unpaid interest thereon, by foreclosing
upon the collateral given to secure the loan’s repayment and reducing the
Participant’s Account, or by any other lawful means

 

121

 

generally available to
creditors and permitted by ERISA and the Code.

 

(B)                                Notwithstanding
the preceding, (1) except in the case of Employees who have been Participants
for five (5) or more Plan Years, the maximum amount by which an active
Participant’s Employer Matching Contribution Account or Employer Discretionary
Contribution Account balance may be reduced in connection with a default shall
be equal to the excess of such balance over the amount of Employer
Contributions made on his behalf for the two (2) Plan Years ending prior to the
default, and (2) in no event shall any portion of a Participant’s Pre-Tax
Contribution Account be reduced in connection with a default prior to the
earlier of (a) the Participant’s separation from service or (b) the date the
Participant attains age 59-1/2.

 

(j)                                     The
Committee shall have the authority to adopt additional terms and conditions
including rules regarding the financial ability of the Participant to repay the
amount he

 

122

 

seeks to borrow, provided that the Committee shall permit loans to be
available to all Participants on a reasonably equivalent basis, and shall not
make loans available to Participants who are Highly Compensated Employees in an
amount representing a greater percentage of such Participants’ vested Account
than is made available to other Participants.

 

123

 

ARTICLE IX

MISCELLANEOUS
PROVISIONS

 

9.1                                 Termination.

 

(a)                                  An
Employer may terminate the Plan with respect to its Employees at any time and
the Board of Directors of Computer Associates International, Inc. shall have
the right to terminate the Plan at any time. 
In the event of the termination or partial termination of the Plan, or
in the event of a complete discontinuance of contributions to the Plan, all
Participants affected thereby shall be fully vested in and have a one hundred
percent (100%) vested right to their Accounts.

 

(b)                                 As
soon as administratively feasible after the termination of the Plan, the
Committee shall direct the Trustee to distribute each Participant’s Account to
the Participant or his Beneficiary, as applicable, in a lump sum, subject,
however, to the applicable provisions of Section 13.5 relating to distributions
in the form of an Annuity or Qualified

 

124

 

Joint and Survivor Annuity; provided, however, that if the Employer or
a Related Company maintains another defined contribution plan which satisfies
the qualification requirements under Section 401(a) of the Code (other than an
employee stock ownership plan as defined in Section 4975(e)(7) of the Code), no
distribution of an Account which exceeds $5,000 shall be made hereunder to a
Participant who has not attained his Normal Retirement Age without such
Participant’s written consent, and if the Participant does not consent to such
distribution, the Committee shall direct the Trustee to directly transfer such
Participant’s Account to the trust created under such other qualified plan in
accordance with Section 411(d)(6) of the Code and the regulations promulgated
thereunder.

 

9.2                                 Merger
or Consolidation.  In the event of
any merger or consolidation with, or transfer of assets or liabilities to, any
other plan, each Participant shall be

 

125

 

entitled to receive a benefit immediately after such merger,
consolidation or transfer (if the plan then terminated) equal to or greater
than the benefit to which he would have been entitled immediately before such
merger, consolidation or transfer (if the Plan then terminated).

 

9.3                                 Alienation
Prohibited.

 

(a)                                  Except
as provided by Section 8.2(f), paragraph (b) below, and Section 401(a)(13)(C)
of the Code, the rights of a Participant to receive benefits hereunder shall not
be anticipated, assigned (either at law or in equity), alienated, or subject to
attachment, garnishment, levy, execution or other legal or equitable process.

 

(b)                                 Notwithstanding
the provisions of paragraph (a) above, the Committee shall direct the Trustee
to pay benefits from the Plan in accordance with the applicable requirements of
any Qualified Domestic Relations Order. For the purposes of this paragraph (b),
a Qualified Domestic Relations Order means

 

126

 

(i)                                     any
judgment, decree or order (including approval of a property settlement
agreement) made pursuant to a State domestic relations law, which relates to
the provision of child support, alimony payments, or marital property rights of
a spouse, former spouse, child or other dependent of a Participant;

 

(ii)                                  which
creates or recognizes the existence of an alternate payee’s right to, or
assigns to an alternate payee the right to, receive all or a portion of a
Participant’s Account;

 

provided, however, that such Qualified Domestic Relations Order must
clearly specify

 

(iii)                               the
name and last known mailing address of the Participant and of each alternate
payee covered by the order;

 

127

 

(iv)                              the
amount or percentage of the Participant’s benefits to be paid to each alternate
payee, or the method by which such percentages are to be determined;

 

(v)                                 the
number of payments, or the period to which the order applies; and

 

(vi)                              the
name of the plan(s) to which such order applies.

 

In no event will any domestic relations order be deemed to be a
Qualified Domestic Relations Order if such order purports to require the
payment of benefits in a form not otherwise provided under the Plan, or to
require the Plan to provide increased benefits, or to require the payment to an
alternate payee of benefits which are required to be paid to another alternate
payee under a previous Qualified Domestic Relations Order.  Notwithstanding the preceding or anything in
the Plan to the contrary, a Qualified Domestic Relations Order may provide

 

128

 

for payment to an Alternate Payee prior to the Participant’s earliest
retirement age, as said term is defined in Section 414(p)(4)(B) of the Code.

 

(c)                                  The
Committee shall establish a reasonable procedure for determining whether any
domestic relations order is a “Qualified Domestic Relations Order”, and to
administer distributions under such Qualified Domestic Relations Order.  Such procedure shall be in writing, and shall
provide for the prompt notification of each Participant and alternate payee
named in the order of (i) the order’s receipt and (ii) the procedure for
determining the qualified status of the order.

 

(d)                                 During
any period in which the issue of whether a domestic relations order is “Qualified”
is being determined, the Committee shall segregate in a separate account any
amounts that would have been payable to the alternate payee during such period
pursuant to such order, if “Qualified”.  If

 

129

 

within the eighteen (18) month period beginning with the date on which
the first payment would be required to be made under the order, if “Qualified,”
it is determined that the order is a Qualified Domestic Relations Order, the
segregated account shall be distributed in accordance with the order.  If the order is not determined to be a
Qualified Domestic Relations Order within such eighteen (18) month period beginning
with the date on which the first payment would be required to be made under the
order, if “Qualified” , the segregated account shall, at the end of the
eighteen (18) month period, be restored to the Account of the Participant and
treated as if no order existed.  Any
determination that an order is a Qualified Domestic Relations Order which is
made after the close of the eighteen (18) month period shall only be applied
prospectively.

 

(e)                                  Notwithstanding
anything in this Section 9.3 or the Plan to the contrary, the Committee may, in
its discretion

 

130

 

and pursuant to procedures as established by the Committee, delay the
distribution of benefits for a reasonable period of time if the committee
receives notice, in the form of personal service in accordance with applicable
civil procedure, that a domestic relations order is being judicially sought.

 

9.4                                 Governing
Law.  This Plan shall be construed
and enforced in accordance with the relevant provisions of the Code and the
ERISA, but to the extent that their provisions shall not govern the Plan, it
shall be construed and enforced in accordance with the laws of the State of New
York, except the decisional or statutory law of such State concerning conflicts
of law or choice of law shall not be used in determining applicable law.

 

9.5                                 Plan
Not Contract of Employment.  No
provision of this Plan shall be construed as a contract of employment between
the Employer and any Employee, a right of continued employment by

 

131

 

any Employee or as a limitation of the right of the Employer to
discharge any Employee for any reason.

 

9.6                                 Reversion
of Certain Contributions.  All
contributions made by the Employer are made for the exclusive benefit of
Participants and their Beneficiaries, and such contributions shall not be used
for or diverted to purposes other than for the exclusive benefit of the
Participants and their Beneficiaries (including the costs of maintaining and
administering the Plan and Trust). 
Notwithstanding the foregoing, amounts contributed to the Trust by the
Employer may be refunded to the Employer, to the extent that such refunds do
not, in themselves, deprive the Plan of its qualified status, under the
following circumstances and subject to the following limitations:

 

(a)                                  Disallowance
of Deduction.  All Contributions made
by the Employer are conditioned on their deductibility

 

132

 

pursuant to Section 404 of the Code. 
If the deduction of all or any portion of a Contribution made by the
Employer is disallowed, such Contribution (to the extent so disallowed) shall
be returned to the Employer within one (1) year of the date of such
disallowance.  If such Contribution shall
include Pre-Tax Contributions, such Pre-Tax Contributions shall be paid to the
Participants on whose behalf they were made, as soon as practicable thereafter.

 

(b)                                 Mistake
of Fact.  In the case of a
Contribution which is made in whole or in part by reason of a mistake of fact
(for example, incorrect information as to the eligibility or compensation of a
Participant, or a mathematical error) that portion of such Contribution as is
attributable to the mistake of fact shall be returned to the Employer within
one (1) year after the payment of the contribution to which the mistake
applies, including any

 

133

 

Pre-Tax Contributions which shall then be
paid to the Participants in the Plan, in the manner described in subparagraph
(a) above.

 

All refunds pursuant to paragraphs (a) and (b) shall be limited in
amount, circumstance and timing to the provisions of Section 403(c) of the
ERISA, and no such refund shall be made if, solely on account of such refund,
the Plan would cease to be a qualified plan pursuant to Section 401(a) of the
Code.

 

9.7                                 Participant
or Beneficiary Unable to be Found.

 

Notwithstanding anything else contained in this Plan to the contrary,
if the Committee is unable to direct payment of a benefit hereunder to a
Participant or Beneficiary entitled thereto because the identity or whereabouts
of such person cannot be ascertained, notwithstanding the registered or
certified mailing of notice to such person at his last known address as
indicated by the records of the Committee or the Employer, then such benefit
and any other benefits of such person payable from the Trust shall be forfeited
and applied in accordance with Section 6.4(c); provided, however, that such

 

134

 

benefits shall be reinstated upon a proper claim being made by the
Participant or Beneficiary.

 

135

 

ARTICLE X

ADMINISTRATIVE
PROVISIONS

 

10.1                           (a)                                  Committee.  The Plan shall be administered by a Committee
consisting of at least three individuals who shall be appointed by and for the
term specified by the Board of Directors of the Employer.  The Board of Directors of the Employer may
remove any member of the Committee from office at any time with or without
cause.  For purposes of this paragraph
(a), the term “Employer” means Computer Associates International, Inc. and its
successors, and shall not include any Related Company which shall have adopted
the Plan.

 

(b)                                 Quorum;
Majority to Govern.  Two-thirds of
the members of the Committee shall constitute a quorum.  A vote of a majority of the members present
at a meeting, if a quorum is present, shall be the act of the Committee.

 

(c)                                  Act
of Committee.  The Committee may act
at a meeting or may act without a meeting, if each Committee member

 

136

 

consents in writing to the adoption of a resolution authorizing the
action.

 

(d)                                 By-Laws.  The Committee may adopt by-laws to govern the
conduct of its internal affairs.

 

(e)                                  Powers
and Duties of Committee.  The
Committee shall control and manage the operation and administration of the
Plan.  The Committee shall administer the
Plan in accordance with its terms and shall have all powers necessary to carry
out the provisions of the Plan.  Without
limiting the generality of the foregoing, the Committee shall have the
following powers and duties which shall be performed in its full and absolute
discretion:

 

(i)                                     requiring
any Participant or Beneficiary to furnish such information or to execute any
forms or documents as it may request for the proper administration of the Plan,
and to condition the

 

137

 

payment of any benefits under the Plan upon the furnishing by such
Participant or Beneficiary of the information so requested;

 

(ii)                                  adopting
and enforcing such rules and regulations and prescribing the use of such forms
as it shall deem necessary for the efficient administration of the Plan;

 

(iii)                               interpreting
the provisions of the Plan, and resolving any ambiguities, inconsistencies and
omissions in the Plan.  The Committee’s
interpretations and decisions shall be conclusive and binding upon all parties
affected thereby, except as otherwise expressly provided herein;

 

(iv)                              determining
the eligibility of any Employee to participate in the Plan;

 

138

 

(v)                                 determining
all questions relating to the status and rights of Participants under the Plan;

 

(vi)                              furnishing
the Trustee with such information as it may reasonably require to perform its
duties hereunder;

 

(vii)                           employing
such clerical staff as it shall deem necessary for the proper administration of
the Plan;

 

(viii)                        furnishing
such reports to the Labor Department and Internal Revenue Service as shall be
required by law;

 

(ix)                                furnishing
such information to Participants and Beneficiaries as shall be required by law;

 

139

 

(x)                                   providing
directions to the Trustee regarding payment of benefits to Participants and
Beneficiaries;

 

(xi)                                preparing
and maintaining adequate records to accomplish the foregoing duties;

 

(xii)                             providing
procedures and rendering necessary decisions for claims for benefits under the
Plan; and

 

(xiii)                          establishing
and maintaining a funding policy for the Plan and communicating such policy to
the Trustee or any investment adviser.

 

(f)                                    Advisers.  To assist in the performance of its duties,
the Committee may engage in such legal counsel, accountants, pension
consultants, actuaries or other advisers as the Committee may deem necessary or
advisable.

 

140

 

(g)                                 Allocation
of Fiduciary Responsibilities.  The
Committee may, by a duly adopted resolution, allocate fiduciary
responsibilities among its members and may designate individuals other than
Committee members to carry out fiduciary responsibilities.

 

(h)                                 Investment
Manager.  The Committee may appoint
(and may remove from office with or without cause) an investment manager to
manage (or acquire and dispose of) any assets of the Trust.

 

(i)                                     Claims
Procedure.  The Committee shall
provide written notice (in terms calculated to be understood by the Participant
and setting forth specific reasons for the denial) of a denial of a Participant’s
claim for benefits under the Plan and shall afford such Participant a
reasonable opportunity for a fair and plenary review of such denial by the
Committee.

 

141

 

(j)                                     Indemnification.  The Employer shall indemnify any member of
the Committee and those to whom the Committee has delegated fiduciary duties
pursuant to paragraph (g) of this Section 10.1, and shall hold such member or
designated fiduciary harmless from and against any and all claims, losses,
damages, expenses and liability arising from any act or failure to act unless
the same is judicially determined to be the result of the gross negligence or
willful misconduct of such member or designated fiduciary.

 

(k)                                  Transmission
of Notices, Forms and Consents through Electronic Media.  Notwithstanding anything in the Plan to the
contrary, any forms, notices or consents required to be provided or given under
the Plan in writing or otherwise, may, in the discretion of the Committee and
in accordance ERISA, the Code and applicable regulations, be transmitted
through electronic (including telephonic) media pursuant to procedures as

 

142

 

established by the Committee, including but not limited to, Participant
enrollments, the execution of Salary Reduction Agreements, contribution
elections, investment elections, beneficiary designations, and the completion
of any forms required to process any distributions or loans under the
Plan.  Notwithstanding anything in this
paragraph (k) to the contrary and unless regulations provide otherwise,
electronic media shall not be used to obtain any spousal consent required under
the Plan.

 

10.2                           Employer.  As used in subparagraphs (b) and (d) below,
the term “Employer” means Computer Associates International, Inc. and its
successors, and shall not include any Related Company which shall have adopted
the Plan:

 

(a)                                  Contributions.  The Employer shall make contributions to the
Trust as specified in Article IV.

 

143

 

(b)                                 Appointment,
Removal and Compensation of Trustee. 
The Employer shall appoint the Trustee and may remove the Trustee from
office with or without cause. The Trustee shall be compensated either directly
from the Employer or from the Trust Fund.

 

(c)                                  Expenses.  The Employer shall pay the expenses of the
Committee, including any expenses of retaining advisers;  provided, however, that if such expenses are
not paid when due, the Committee may direct that any such reasonable expenses
shall be paid by the Trustees directly from the Trust.

 

(d)                                 Amendment
of Plan.  The Employer may amend the
Plan by a resolution adopted by its Board of Directors or by the Executive
Committee of the Board of Directors; provided, however, that any technical
amendments to the Plan which may be necessary solely to

 

144

 

ensure that the Plan continues to qualify
under the Code, ERISA, any other statute, or any regulations or pronouncements
promulgated by the Internal Revenue Service, the United States Department of
Labor, or any other governmental agency with jurisdiction over the Plan, may be
adopted by proper resolution and execution of the appropriate documents by the
members of the Committee.

 

10.3                           Service
in More Than One Capacity.  Any
individual or group of individuals may serve in more than one fiduciary
capacity with respect to the Plan, including service both as a Trustee and as a
Committee member.

 

10.4                           Payments
to the Trust and Establishment of Investment Funds.  The Employer shall pay all Contributions
under the Plan to the Trustee.  The
Trustee shall hold all Contributions received by it as Trustee in various
investment

 

145

 

funds selected by the Committee, for the purpose of enabling
Participants to direct the investment of their Accounts pursuant to Article
XI.  Such investment funds may include a
Company Stock Fund, which shall consist primarily of the common stock of
Computer Associates International, Inc.

 

10.5                           Payments
from the Trust.  The Trustee shall,
in accordance with the written instructions of the Committee, pay all amounts
directly to the Employee, Participant or Beneficiary entitled to the amounts
specified in such instructions.  Payments
shall be made in money by check, except that payments from the Company Stock
Fund (as set forth in Section 10.4) may, at the Employee’s, Participant’s or
Beneficiary’s election, be made either (a) in kind in full shares of Company
Stock and in cash for any partial shares, or (b) entirely in cash; provided,
however, that with respect to a distribution pursuant to Section 7.2(b) or
Section 7.4, if no election is made by the Employee, Participant or Beneficiary
within a reasonable period of time prior to such distribution, as established by
the Committee and

 

146

 

applied in a uniform and nondiscriminatory manner, then any payments to
such Employee, Participant or Beneficiary from the Company Stock Fund shall be
made in cash.

 

10.6                           Voting
Rights With Respect to Company Stock Fund.

 

Notwithstanding anything in this Section or
Plan to the contrary, the provisions of Section 4(e)(v) of the Trust Agreement
entered into between Computer Associates International, Inc. and the Trustee
(Fidelity Management Trust Company) relating to voting and tender offers of
Company Stock shall govern this Section and are hereby incorporated by
reference.

 

147

 

ARTICLE XI

INVESTMENT
DIRECTIONS

 

11.1                           Directed
Investments.  Except as otherwise
provided herein and in Section 11.2, each Participant shall direct that all
Contributions made or allocated to his Account in accordance with Section 4.1,
Section 4.4, Section 4.5, Section 4.7, or Section 4.12 be invested in the
various investment funds selected by the Committee pursuant to Section
10.4.  Any apportionment of investment
elections by a Participant among such funds shall be made in such multiples as
determined by the Committee and applied in a uniform manner to all
Participants.  A direction made by a
Participant pursuant to this Article shall be made in such manner as prescribed
by the Committee, and shall be deemed to be a continuing direction by the
Participant, until changed by the Participant as described below.  Each Participant shall have the right, which
may be exercised at least one time during any “election period,” as defined
hereinafter, to transfer

 

148

 

(in such multiples as determined by the Committee and uniformly applied
to all Participants) all or any portion of the amounts then credited to his
Account from one investment fund to any of the other investment funds as
selected by the Committee.  For purposes
of this Article, “election period” means the period determined by the
Committee, which shall be at least a three-month period and applied to all
Participants in a uniform and nondiscriminatory manner; provided, however, that
in the event that the Committee shall change the investment funds available to
Participants hereunder or there shall be a change in the Plan Trustee, such
election period may be suspended to the extent necessary to accomplish such
changes.  In addition, each Participant
shall have the right, which may be exercised at least one time during such “election
period,” to change any such direction (in such multiples as determined by the
Committee and uniformly applied to all Participants) with respect to future

 

149

 

Contributions.  If any
Participant initially fails to designate the manner of investment of his
Account or any Contributions made on his behalf, such failure shall be deemed
to be an election by the Participant to invest such amounts in a money market
fund pursuant to the terms of the Trust Agreement of the Plan entered into
between the Employer and the Trustee.

 

11.2                           Allocation
of Employer Discretionary Contributions Made in Computer Associates
International, Inc. Stock.  In the
event that all or a portion of any Employer Discretionary Contributions for a
Plan Year shall be made in shares of common stock of Computer Associates
International, Inc. pursuant to Section 4.9(b), the Committee may, in its
discretion, direct that all or a portion of such Contributions be allocated
directly to the Company Stock Fund (as set forth in Section 10.4), regardless
of any Participant’s investment election in effect under Section 11.1 at the
time such Contributions are made to the Plan. 
If a

 

150

 

Participant has not directed, pursuant to Section 11.1, the investment
of any portion of his Account, or any portion of future Contributions to be
allocated thereto, to the Company Stock Fund at the time the aforesaid
Contributions are made to the Plan, the Committee shall establish such a
Company Stock Fund account on such Participant’s behalf.  Nothing contained herein shall prevent a
Participant from directing, pursuant to Section 11.1 and procedures adopted by
the Committee, the transfer of all or any portion of the amounts deposited into
such Company Stock Fund to any of the other investment funds available pursuant
to Section 11.1.

 

11.3                           Application
of Securities Law.  With respect to
any persons subject to Section 16 of the Securities Exchange Act of 1934 (the “1934
Act”), transactions under this Article or any other provisions of the Plan are
intended to comply with all applicable conditions of Rule 16b-3 or its
successors under the 1934 Act.  To the
extent any provision of this Article or the Plan or any action of the Committee
fails to so comply, it shall

 

151

 

be deemed null and void, to the extent permitted by law and deemed
advisable by the Committee.

 

152

 

ARTICLE XII

SPECIAL
TOP-HEAVY PROVISIONS

 

12.1                           Purpose.  The purpose of this Article is to comply with
the special rules applicable to top-heavy plans contained in Section 416 of the
Code and the regulations thereunder.  In
the event the Plan should become top-heavy as defined in Section 12.2, the
provisions of this Article shall apply notwithstanding anything to the contrary
elsewhere in this Plan.  In the event
that any limitations imposed by this Article are no longer necessary for the
Plan to meet the requirements of Section 401(a) or other applicable provisions
of the Code, these rules shall immediately become null and void and shall no
longer apply without the necessity of further amendment to the Plan.

 

12.2                           Determination
of Top-Heaviness.  The Plan will be
considered to be top-heavy, if as of the most recent determination date:

 

153

 

(a)                                  the
sum of the Account balances, under all defined contribution plans included in
the aggregation group (described in Section 12.4), of all Participants who are
key employees (as defined in Section 12.3) for such Plan Year exceeds sixty
percent (60%) of the sum of the Account balances of all Participants, or

 

(b)                                 the
Plan is part of a top-heavy group.

 

The determination date shall be the last day of the first Plan Year
thereof, and thereafter, the last day of the preceding Plan Year.  For purposes of determining the amount of the
Account of any Participant, such amount shall, except as otherwise provided
herein, include the following:

 

(i)                                     any
plan distributions made within the five (5) year period ending on the
determination date.  All distributions,
including distributions under a terminated plan, which if it had not been
terminated

 

154

 

would have been required to be included in an
aggregation group, will be counted.

 

(ii)                                  with
respect to unrelated rollovers and plan-to-plan transfers (ones which are both
initiated by the Employee and made from a plan maintained by one employer to a
plan maintained by another employer), the plan providing the funds rolled over
or transferred shall always consider such rollovers or plan-to-plan transfers
as a distribution for purposes of this Section. 
The plan accepting such unrelated rollovers or plan-to-plan transfers
shall not count such rollovers or plan-to-plan transfers accepted after
December 31, 1983 as part of the Employee’s account.  However, rollovers or plan-to-plan transfers
accepted prior to January 1, 1984 shall be considered as part of the Employee’s
account.

 

155

 

(iii)                               with
respect to related rollovers and plan-to-plan transfers (ones either not
initiated by the Employee or made to a plan maintained by the same employer),
the plan providing the funds rolled over or transferred shall not count such
funds as a distribution for purposes of this Section.  The plan accepting such rollover or
plan-to-plan transfer shall consider such rollover or plan-to-plan transfer as
part of the Employee’s account, irrespective of the date on which such rollover
or plan-to-plan transfer is accepted.

 

(iv)                              for
Plan Years beginning after December 31, 1984, the account of any Employee who
has not performed any service for the Employer during the five (5) year period
ending on the determination date shall be disregarded.

 

156

 

12.3                           Key
Employees.  The term “key employee”
means any Participant who at any time during the Plan Year or any of the four
(4) preceding Plan Years is, or was:

 

(a)                                  an
officer of the Employer having Compensation in excess of fifty percent (50%) of
the dollar limitation in effect under Section 415(b)(1)(A) of the Code for the calendar
year in which such Plan Year ends; provided, however, no more than the lesser
of (i) fifty Employees, or (ii) the greater of three (3) Employees or ten
percent (10%) of all Employees are to be treated as officers; and provided
further, that officers of any division of the Employer shall not be deemed to
be an officer of the Employer merely because of their positions as officers of
divisions;

 

(b)                                 one
of the ten (10) Employees having annual Compensation from the Employer or more
than the dollar

 

157

 

limitation in effect under Section
415(c)(1)(A) of the Code for the calendar year in which such Plan Year ends and
owning (or considered as owning within the meaning of Section 318 of the Code)
more than a one-half (1⁄2%) percent interest as well as one of the ten (10)
largest interests in the Employer;

 

(c)                                  a
five (5%) percent owner of the Employer; or

 

(d)                                 a
one (1%) percent owner of the Employer having an annual Compensation from the
Employer of more than $150,000.

 

An Employee shall be considered a five percent (5%) owner under
paragraph (c) above if the Employee owns more than five percent (5%) of the
Employer’s outstanding stock or stock possessing five percent (5%) of the total
combined voting power of all the stock of the Employer.  The term one (1%) percent owner under
paragraph (d) above means any person who would be

 

158

 

described in the preceding sentence if “one (1%) percent” were
substituted for “five (5%) percent” each place it appears in the preceding
sentence.  In determining percentage
ownership for purposes of this Section 12.3, the constructive ownership rules
contained in Section 318 of the Code (as modified by Section 416(i)(1)(B)(iii)
of the Code) shall be applicable, but the aggregation rules of Sections
414(b),(c) and (m) of the Code shall not apply. 
In determining the number of officers taken into account under paragraph
(a) above, Employees described in Section 414(q)(5) of the Code shall be
excluded.

 

For purposes of this Section 12.3, Compensation means compensation
within the meaning of Section 414(q)(4) of the Code, and in determining
such Compensation, all Related Companies shall be included with the Employer as
a single employer.

 

12.4                           Aggregation
Rules.  All Related Companies shall
be included with the Employer as a single employer for the purposes

 

159

 

of determining top-heaviness. 
All plans of the Employer in which a key employee participates, and each
other plan of the Employer which enables any plan in which a key employee
participates to meet the requirements of Section 401(a)(4) or Section 410 of
the Code, will be aggregated as part of a required aggregation group for the
purpose of determining top-heaviness.

 

Each plan in the required aggregation group will be top-heavy if the
group is top-heavy and no plan in the group will be top-heavy if the group is
not top-heavy.

 

Although not required, the Committee may elect to include as part of
the aggregation group any plans that are not part of the required aggregation
group as described above, but that satisfy the requirements of Sections
401(a)(4) and 410 of the Code when considered together with the plans
constituting the required aggregation group. 
If the aggregation group elected by the Committee is top-heavy, only
those plans that are part of the

 

160

 

required aggregation group will be subject to the additional
requirements placed on top-heavy plans.

 

An aggregation group will be top-heavy if the sum (as of the
determination date) of:

 

(a)                                  the
present value of the cumulative accrued benefits for key employees under all
defined benefit plans included in such group, and

 

(b                                     the
aggregate of the accounts of key employees under all defined contribution plans
included in such group, exceeds sixty (60%) percent of a similar sum determined
for all employees.

 

12.5                           Special
Minimum Contribution and Vesting Rules Becoming Operative in the Event the Plan
Becomes Top-Heavy.  In the event that
the Plan shall be determined to be top-heavy in

 

161

 

any Plan Year, the following special minimum contribution and vesting
requirements shall become operative for such Plan Year:

 

(a)                                  The
aggregate Employer Discretionary Contributions allocated to the Account of a
non-key employee for each Plan Year in which the Plan is top-heavy shall equal
the lesser of (i) three percent (3%) of compensation (as defined in Treasury
Regulation Section 1.415-2(d)) for that Plan Year, or (ii) the largest
percentage of compensation of Pre-Tax Contributions, Employer Matching
Contributions, and Employer Discretionary Contributions allocated to the
Account of a key employee under the Plan for the Plan Year.  All Employees who are either (i) Participants
or (ii) who have satisfied the eligibility requirements pursuant to Section 3.1
but for whom no Account has been established under the Plan, and who have not

 

162

 

separated from the service of the Employer as
of the last day of the Plan Year shall receive the minimum contribution.

 

(b)                                 The
vested portion of a Participant’s Employer Matching Contribution Account and
Employer Discretionary Contribution Account, except for a Participant who does
not complete an Hour of Service after the Plan becomes top-heavy, will be
determined in accordance with the minimum vesting schedule set forth below, if
the application of such schedule would result in a greater percentage of the
Employer Matching Contribution Account and Employer Discretionary Contribution
Account being vested than the application of the vesting provisions set forth
in Section 6.2.

 

	
  Years of Service

  	
   

  	
  Vested

  Percentage of Account

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 2

  	
   

  	
  0

  	
  %

  
	
  2 but less than 3

  	
   

  	
  20

  	
  %

  
	
  3 but less than 4

  	
   

  	
  40

  	
  %

  
	
  4 but less than 5

  	
   

  	
  60

  	
  %

  
	
  5 but less than 6

  	
   

  	
  80

  	
  %

  
	
  6 or more

  	
   

  	
  100

  	
  %

  

 

A Year of Service, for the purpose of this
Section, means a Period of Service of 365 days, and Years of Service shall
include only those years of service required

 

163

 

to be counted under Section 411(a) of the Code, and shall not include
those years of service permitted to be disregarded under Section 411(a)(4).

 

12.6         Termination of
Top-Heavy Status.  If the Plan ceases
to be top-heavy, this Article XII shall be inoperative with respect to any Plan
Year for which the Plan is determined not to be top-heavy; except that with
respect to any Plan Participant who has completed three (3) or more Years of
Service, as defined in paragraph (b) of Section 12.5, as of the beginning of
the Plan Year for which the Plan is determined not to be top-heavy, the minimum
vesting schedule set forth in that paragraph will continue to apply if, at any
time, the application of such schedule would result in a greater percentage of
the Employer Matching Contribution Account and Employer Discretionary
Contribution Account being vested than would the application of the vesting
provisions set forth in Section 6.2.

 

164

 

ARTICLE XIII

SPECIAL
SITUATIONS

 

13.1                           Definitions.  Solely for the purposes of this Article XIII,
the following definitions shall apply:

 

(a)                                  Annuity
Starting Date means (i) the first day of the first period for which a
Transferred Employee’s benefits under this Article are payable as an annuity,
or (ii) in the event the Transferred Employee’s benefits under this Article are
not payable as an annuity, the first day on which all events have occurred
which entitle the Participant to such benefits.

 

(b)                                 Prior
Company means any company or other business entity acquired by the
Employer.

 

(c)                                  Prior
Plan means the qualified retirement plan under Code Section
401(a)(including Code Section 401(k))maintained by a Prior Company.

 

165

 

(d)                                 Transferred
Employee means an Employee who was employed by a Prior Company immediately
before he became an Employee and who became an Employee as a result of the
acquisition of the Prior Company by the Employer.

 

13.2                           Eligibility
of Transferred Employees.  A
Transferred Employee shall become a Participant in accordance with the
provisions of Article III hereof.  In
applying Article III to Transferred Employees, Periods of Service shall include
service with the Prior Company determined in accordance with the applicable
provisions of the Prior Plan, if any.

 

13.3                           Prior
Plan Accounts and Joint and Survivor Annuity Accounts.  Amounts which are transferred to the Plan
from the Prior Plan (the “Rollover Contributions”) shall be allocated to the
Rollover Contribution Account of the Transferred Employee; provided, however,
that in the event any portion of the Rollover Contributions are subject to the
provisions of Section 417 of the

 

166

 

Code, said portion of the Rollover Contributions, if any, shall be
allocated to a separate account for each Transferred Employee, hereinafter
referred to as the “Joint and Survivor Annuity Account”.  Each Joint and Survivor Annuity Account shall
be credited or charged with Net Income or Net Loss in the manner described in
Section 5.3.

 

13.4                           Vesting
of Transferred Employees. Each Transferred Employee shall at all times be
one hundred (100%) percent vested in his Rollover Contribution Account and
Joint and Survivor Annuity Account, if any. 
Any Contributions made under this Plan on behalf of or by a Transferred
Employee shall be vested in accordance with the provisions of Article VI
hereof.  A Transferred Employee’s vesting
service under the Plan shall include service with the Prior Company, if any,
determined in accordance with the applicable provisions of the Prior Plan, if
any.

 

167

 

13.5                           Distribution
of Accounts of Transferred Employees.

 

(a)                                  Except
as otherwise provided in the following paragraphs, the Account balance of each
Transferred Employee shall be distributed in accordance with the provisions of
Article VII.

 

(b)                                 (i)                                     If
a Transferred Employee is married at the time of distribution, such Transferred
Employee’s Joint and Survivor Annuity Account shall, subject to the provisions
of Section 7.2(b), be distributed hereunder in the form of an annuity purchased
with the entire Joint and Survivor Annuity Account of the Transferred Employee
(A) which is payable for the lifetime of the Transferred Employee with a
survivor annuity for the lifetime of the Transferred Employee’s spouse equal to
at least fifty (50%) percent of the annuity payable during the joint lives of
the Transferred Employee and the Transferred Employee’s spouse,

 

168

 

and (B) which is the actuarial equivalent of a single life annuity
payable for the lifetime of the Transferred Employee that could have been
purchased by utilizing the Transferred Employee’s entire Joint and Survivor
Annuity Account (hereinafter the “Qualified Joint and Survivor Annuity”),
unless the Transferred Employee elects otherwise pursuant to the provision of
paragraph (c).

 

(ii)                                  If
a Transferred Employee is not married at the time of distribution, such
Transferred Employee’s Joint and Survivor Annuity Account shall, subject to the
provisions of Section 7.2(b), be distributed hereunder in the form of a single
life annuity purchased with the entire Joint and Survivor Annuity Account of
the Transferred Employee (hereinafter the “Annuity”), unless the Transferred
Employee elects otherwise pursuant to the provisions of paragraph (iii).  The term Annuity shall, wherever it

 

169

 

appears hereinafter, mean an annuity
purchased with the Transferred Employee’s entire Joint and Survivor Annuity
Account, which is payable for the lifetime of the Transferred Employee.

 

(iii)                               A
Transferred Employee may elect, in writing, during an election period
commencing ninety (90) days prior to his Annuity Starting Date, to waive his
right to a Qualified Joint and Survivor Annuity or Annuity, as applicable, and
to have his Joint and Survivor Annuity Account payable under the distribution
option set forth in Article VII and may revoke said election, in writing, at
any time prior to the end of said election period.  The number of revocations and subsequent new
elections shall not be limited, and any new election must comply with the
requirements of this paragraph (iii).  In
the case of a

 

170

 

married Transferred Employee, an election shall not be given effect
unless the Transferred Employee’s spouse consents, in writing, to the election
during the ninety (90) day election period described above.  Such spousal consent shall acknowledge the
effect of the election on the spouse’s rights to benefits under the Plan, and
the optional form of benefit designated by the Transferred Employee, which may
not be changed without spousal consent (unless the Participant changes his
election to the Qualified Joint and Survivor Annuity).  Such spousal consent shall be witnessed by a
notary public.  Spousal consent to the
election or to a subsequent change in the optional form of benefit shall not be
required if it is established to the satisfaction of the Plan Administrator
that such spousal consent cannot be obtained because (A) there is no spouse,
(B) the spouse cannot be located, (C) the Participant is legally separated

 

171

 

or has been abandoned (within the meaning of local law) and the
Participant has a court order to such effect, or (D)  of such other circumstances as the Secretary of
the Treasury may, by regulations or otherwise, prescribe.  In the event the Participant’s spouse is
legally incompetent to give such spousal consent hereunder, the spouse’s legal
guardian, even if such guardian is the Participant, may give such consent.  A former spouse’s consent shall not be
binding on a new spouse.  Spousal consent
to the Transferred Employee’s revocation of an election to waive the Qualified
Joint and Survivor Annuity shall not be required.  A former spouse’s consent shall not be binding
on a new spouse. Not-withstanding anything herein to the contrary, the
Committee may, in its discretion which shall be applied in a uniform and
nondiscriminatory manner, permit the spouse’s consent hereunder to expressly
permit changes in the optional form

 

172

 

of benefit designated by the Participant without any requirement of
further consent by the spouse.

 

(iv)                              The
Committee shall, no later than thirty (30) days and no more than ninety (90)
days prior to the Annuity Starting Date, provide each Transferred Employee
whose vested Account exceeds $5,000 and on whose behalf a Joint and Survivor
Annuity Account is maintained under the Plan with a written explanation of:

 

(A)                              the
terms and conditions of the Qualified Joint and Survivor Annuity or Annuity;

 

(B)                                the
Transferred Employee’s right to elect another form of benefit, and the effect
of such election;

 

(C)           the
rights of the Transferred Employee’s spouse with respect to the Qualified Joint

 

173

 

and Survivor Annuity, and any election not to receive benefits in such
form;

 

(D)                               the
Transferred Employee’s right to revoke any election not to receive benefits in
the form of a Qualified Joint and Survivor Annuity or Annuity and the effect of
such revocation;

 

(E)                                 the
material features and relative values of the optional forms of benefit
available under the Plan; and

 

(F)                                 the
Transferred Employee’s right, if any, to defer the commencement of his
distribution.

 

Notwithstanding anything herein to the contrary, if a Transferred
Employee, after having received the aforesaid written explanation,
affirmatively elects a form of distribution and such Transferred Employee’s
spouse consents to such distribution, if necessary, in the manner described in
Section 13.5(b)(iii), the Annuity Starting Date may be less than thirty (30)
days after said written explanation is

 

174

 

provided to the Transferred Employee, provided (1) the Committee
provides information to the Transferred Employee clearly indicating that he has
a right to at least thirty (30) days to consider whether to waive the Qualified
Joint and Survivor Annuity and consent to a form of distribution other than the
Qualified Joint and Survivor Annuity, (2) the Transferred Employee is permitted
to revoke an affirmative distribution election at least until the Annuity
Starting Date, or, if later, at any time prior to the expiration of the
seven-day period that begins the day after the explanation of the Qualified
Joint and Survivor Annuity is provided to the Transferred Employee,(3) the
Annuity Starting Date is after the date the aforesaid written explanation is
provided to the Transferred Employee; provided, however that the Annuity
Starting Date may be before the date that any affirmative election is made by
the

 

175

 

Transferred Employee and before the date the distribution may commence
under (4) below, and (4) distribution in accordance with the affirmative
election does not commence before the expiration of the seven-day period that
begins the day after the written explanation is provided to the Transferred
Employee.

 

(v)                                 The
rights of any spouse or Beneficiary hereunder shall be extinguished to the
extent that such rights are in conflict with the provisions of any domestic
relations order which is a “Qualified Domestic Relations Order” within the
meaning of Section 206(d)(3)(A) of ERISA.

 

(c)                                  (i)            If a married Transferred Employee shall
die prior to his Annuity Starting Date, the deceased Transferred Employee’s
Joint and Survivor Annuity Account shall be applied toward the purchase of a
lifetime annuity for such Transferred Employee’s spouse (hereinafter the

 

176

 

“Pre-Retirement Survivor Annuity”), unless
such Transferred Employee elects otherwise pursuant to the election procedure
set forth in paragraphs (ii) and (iii) below. 
Annuity payments to the spouse shall commence no later than the first
day of the month following the date the Transferred Employee would have
attained his Normal Retirement Age, or, if later, the date the Transferred
Employee died; provided, however, that upon written request from the spouse,
the annuity may be paid commencing as of the first day of any month following
the Transferred Employee’s death. 
Notwithstanding the above, the Committee shall distribute the
Transferred Employee’s entire Account to the surviving spouse in a lump sum as
soon as practicable following the Transferred Employee’s death in the event
such Account does not exceed $5,000, and, to the extent permitted by law, the
surviving spouse may elect to receive the deceased

 

177

 

Transferred Employee’s entire Account in
accordance with the provisions of Section 7.4, in lieu of the Pre-retirement
Survivor Annuity described in this paragraph (i).

 

(ii)                                  A
Transferred Employee on whose behalf a Joint and Survivor Annuity Account is maintained
may elect to waive the Pre-retirement Survivor Annuity described in paragraph
(i) above and designate a Beneficiary other than his spouse, during the
election period described in paragraph (iii) below.  If the Transferred Employee elects to waive the
Pre-retirement Survivor Annuity, then, in the event of the death of the
Transferred Employee prior to his Annuity Starting Date, the deceased
Transferred Employee’s Joint and Survivor Annuity Account shall be distributed
in accordance with the provisions of Section 7.4 hereof.  A

 

178

 

waiver by a Transferred Employee of the
Pre-retirement Survivor Annuity shall not be effective unless the Transferred
Employee’s spouse consents in writing to such waiver during the election period
described in paragraph (iii) below.  Such
spousal consent shall acknowledge the effect of the waiver on the spouse’s
rights to benefits under the Plan, and the specific non-spouse Beneficiary, if
any, designated by the Transferred Employee, including any class of
Beneficiaries or contingent Beneficiaries, which designations may not be
changed without the spouse’s consent (unless such spousal consent expressly
permits such changes without any requirement of further consent by the spouse
or unless the Transferred Employee charges his election to the Pre-Retirement
Spouse’s Annuity).  Such spousal consent
shall be witnessed by a notary public. 
Spousal consent to a waiver of the Pre-retirement Survivor Annuity or to
a

 

179

 

subsequent change in Beneficiary shall not be
required if it is established to the satisfaction of the Committee that such
spousal consent cannot be obtained because (A) there is no spouse, (B) the
spouse cannot be located, (C) the Participant is legally separated or has been
abandoned (within the meaning of local law) and the Participant has a court
order to such effect or (D) of such other circumstances as the Secretary of the
Treasury may, by regulations or otherwise, prescribe.  In the event the Participant’s spouse is
legally incompetent to give such spousal consent hereunder, the spouse’s legal
guardian, even if such guardian is the Participant, may give such consent.  Spousal consent to the Transferred Employee’s
revocation of a waiver of the Pre-retirement Survivor Annuity under paragraph
(iii) below is not required.  A former
spouse’s consent shall not be binding on a new spouse.

 

180

 

Not-withstanding anything herein or in the
Plan to the contrary, nothing contained in this Section or the Plan shall
require the Committee to permit the designation of contingent
Beneficiaries.  In addition and
notwithstanding anything herein to the contrary, the Committee may, in its
discretion which shall be applied in a uniform and nondiscriminatory manner,
permit the spouse’s consent hereunder to expressly permit changes in the
Beneficiary designation by the Participant without any requirement of further
consent by the spouse.

 

(iii)                               Each
Transferred Employee on whose behalf a Joint and Survivor Annuity Account is
maintained shall have the right to waive the Pre-retirement Survivor Annuity in
accordance with paragraph (ii), and to revoke said waiver during an election
period commencing on the first day of the Plan Year in which the Transferred
Employee

 

181

 

attains age thirty-five (35), or, if later,
on the date the Transferred Employee first becomes a Participant, and ending on
the date of the Transferred Employee’s death; provided, however, that if the
Transferred Employee’s employment with the Employer is terminated, the election
period shall commence no later than the date of termination of employment with
respect to amounts in the Joint and Survivor Annuity Account prior to such
date.  The number of revocations, and
subsequent new waivers shall not be limited. 
Any new waivers shall comply with the requirements of paragraph (ii)
above and this paragraph (iii).

 

(iv)                              The
Committee shall provide to each Transferred Employee on whose behalf a Joint
and Survivor Annuity Account is maintained, within the period beginning with
the first day of the Plan Year in which the Transferred Employee attains age
thirty-two (32) and ending on the last

 

182

 

day of the Plan Year in which the Transferred
Employee attains age thirty-four (34), a written explanation of:

 

(A)                              the
terms and conditions of the Pre-retirement Survivor Annuity;

 

(B)                                the
Transferred Employee’s right to waive the Pre-retirement Survivor Annuity and
the effect of such waiver;

 

(C)                                the
rights of the Transferred Employee’s spouse with respect to the Pre-retirement
Survivor Annuity and any waiver thereof, and any designation of a Beneficiary
other than the spouse; and

 

(D)                               the
Transferred Employee’s right to revoke any waiver of the Pre-retirement
Survivor Annuity and the effect of such revocation;

 

provided, however, that if the Transferred Employee becomes a
Participant after attaining age thirty-two (32), said

 

183

 

written explanation shall be provided to him by the end of the three
(3) year period beginning with the first day of the Plan Year of his entry, or,
if the Transferred Employee terminates service prior to age thirty-two (32),
said written explanation shall be provided to him within one (1) year following
such termination.

 

(iv)                              Except
as otherwise provided in Section 7.2(b), with respect to any Joint and Survivor
Annuity Account, as described in Section 13.3, of any Transferred Employee who
was a former participant in the Newtrend Plan, the Qualified Joint and Survivor
Annuity described in Section 13.5(b)(i) shall include an annuity payable for the
lifetime of the Transferred Employee with a survivor annuity for the lifetime
of the Transferred Employee’s surviving spouse equal to, pursuant to the
Participant’s election, seventy-five percent (75%) or one hundred percent
(100%) of the annuity payable during the joint lives of

 

184

 

the Transferred Employee and the Transferred Employee’s spouse and
which is equal in value to the Qualified Joint and Survivor Annuity described
in Section 13.5(b)(i).

 

(v)                                 Except
as otherwise provided in Section 7.2(b), with respect to any Joint and Survivor
Annuity Account, as described in Section 13.3, of any Transferred Employee who
was a former participant in the Legent Plan, the Qualified Joint and Survivor
Annuity, as set forth under Section 13.5(b), shall include an annuity for the
lifetime of the Transferred Employee with a survivor annuity equal to, at the
Transferred Employee’s election, one hundred (100%) percent (instead of fifty
(50%)percent) of the annuity payable during the joint lives of the Transferred
Employee and the Transferred Employee’s spouse and which is the actuarial
equivalent of a single life annuity payable for the lifetime of the Transferred
Employee that could have been purchased utilizing the Transferred Employee’s
Joint

 

185

 

and Survivor Annuity Account.  In
addition to the preceding, the provisions of Section 13.5(c) shall apply to
such Transferred Employee’s Joint and Survivor Annuity Account.

 

13.6                           Assignment
of Joint and Survivor Annuity Account for Plan Loan.  In no event shall any portion of the Joint
and Survivor Annuity Account of a married Transferred Employee be assigned as
collateral for a loan pursuant to the provisions of Section 8.2(f), unless such
Transferred Employee’s spouse consents, in writing, to such assignment, within
the ninety (90) day period prior to the distribution of the loan.  Such spousal consent shall be in the manner
described in Section 13.5(b)(iii).

 

13.7                           Rollover
Contribution Account of Non-Transferred Employees.  In the event that a Prior Plan maintained by
a Prior Company shall be terminated on or after such Prior Company becomes a
Related Company, amounts transferred to the Plan as a result of the application
of Treas. Reg. Section 1.411(a)-11(e)(1)

 

186

 

on behalf of employees who where participants in the Prior Plan but who
are not Transferred Employees, shall be allocated to a Rollover Contribution
Account on behalf of such employees. 
Such employees shall be one hundred (100%) percent vested at all times
in such Rollover Contribution Accounts, the distribution of which shall be
subject to the applicable provisions of Section 13.5.

 

IN WITNESS WHEREOF, Computer Associates International, Inc., as authorized
by its Board of Directors, has caused these presents to be signed by its proper
officer this            day
of          , 2001.

 

	
  Attest:

  	
   

  	
  COMPUTER ASSOCIATES INTERNATIONAL, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  
	
  Secretary

  	
   

  	
  Title:

  

 

187

 

APPENDIX A

Effective Date
Provisions

 

The provisions of this amended and restated Plan shall be effective
March 31, 1997, except as otherwise provided (i) below, (ii) in the Plan, or
(iii) pursuant to any applicable regulations, rulings, notices, announcements
or other pronouncements:

 

1.                                       Paragraph
(b) of Section 1.1(11) and Sections 1.1(18), 1.1(23), 4.14 and 6.3(a) shall be
effective December 12, 1994.

 

2.                                       Section
5.5(1)(ii) shall be effective with respect to limitation years beginning after
December 31, 1994.

 

3.                                       Section
7.3(b) shall be effective July 1, 2001.

 

4.                                       Section
7.7(c) shall be effective with respect to years beginning after December 31,
1996.

 

5.                                       The
reference to Section 401(a)(13)(C) of the Code in Section 9.3(a) shall be effective
with respect to judgments, orders, decrees issued and settlement agreements
entered into on or after August 5, 1997.

 

6.                                       The
following Plan provisions became ineffective subsequent to the March 31, 1997
effective date of this amendment and restatement and apply only with respect to
periods between March 31, 1997 and the applicable dates indicated below.

 

(a)                                  The
following provisions were effective until ninety (90)days after the date this
amended and restated Plan is adopted:

 

“1.1(6) Early Retirement Age means, with respect to any
Participant whose employment terminates before Normal Retirement Age, the later
of:

 

(a)                                  the
first day of the month during which he attains age fifty-five (55); or

 

A-1

 

(b)                                 the
tenth (10th) anniversary of the date the Participant commenced participation in
the Plan.”

 

(b)                                 The
last sentence of Sections 3.1(b), 4.5, and 5.2(c), respectively, read as
follows until March 31, 1998:

 

(i)                                     With
respect to Section 3.1(b):

 

“Notwithstanding anything in this Section of the Plan to the contrary,
in no event shall employees of Infresco Corporation be eligible to participate
in the Plan with respect to Employer Discretionary Contributions.”

 

(ii)                                  With
respect to Section 4.5:

 

“Notwithstanding anything in this Section of the Plan to the contrary,
in no event shall any Employer Discretionary Contribution be made by Infresco
Corporation or with respect to any employee of Infresco Corporation.

 

(iii)                               With
respect to former Section 5.2(c):

 

“In addition, and notwithstanding anything in this Plan to the
contrary, no allocation shall be made for any Plan Year with respect to
employees of Infresco Corporation.”

 

(c)                                  The
following provisions were effective until ninety (90)days after the date this
amended and restated Plan is adopted:

 

“§7.1                    Termination
Other Than by Reason of Retirement, Disability or Death. The
non-forfeitable Account balance of a Participant who has terminated employment
with the Employer other than by reason of retirement, Disability or death,
shall be distributed to him in a lump sum as soon as practicable following the
Participant’s termination of employment but not later than 60 days following
the date such Participant incurs a One Year Break-in-Service, provided that
either (i) the value of such balance at the date of distribution is $3,500 or
less, or (ii) the Participant requests such a distribution.  If the value of such balance is greater than
$3,500 and the Participant does not request such a distribution, such balance shall
be held in the Fund until the Participant reaches his Normal

 

A-2

 

Retirement Age, at which time it shall be paid to him under any method
specified in §7.3 selected by such Participant. 
Notwithstanding anything in this Plan to the contrary, for the Plan Year
commencing March 31, 1998 and for all Plan Years thereafter, the $3,500 amount
referred to herein shall be increased to $5,000.

 

§7.2                          (1)                                  Payment
at Normal Retirement Age.  Upon a
Participant’s termination of employment at or after Normal Retirement Age,
amounts credited to his Account shall be payable to him under any method
specified in §7.3 selected by such Participant. 
Except as provided in §7.6(b), any payment under this subparagraph shall
be made or shall commence within 60 days following the end of the Plan Year in
which occurs such termination of employment.

 

(2)                                  Early
Retirement Age or Disability.  Except
as provided in §7.3(d), a Participant who terminates employment at or after
Early Retirement Age or due to Disability (before his attainment of Normal
Retirement Age) may elect to have the amounts credited to his Pre-Tax,
Voluntary and Rollover Contribution Accounts and the non-forfeitable portion of
his Employer Contribution Account paid to him under any method specified in
§7.3 selected by such Participant, in which case any such payments shall be
made or shall commence as soon as practicable following such termination of
employment, but no later than 60 days following the date such Participant
incurs a One Year Break-in-Service; provided, however, that if the Participant
does not make the preceding election, such amounts shall be held in the Fund
until the Participant reaches his Normal Retirement Age, at which time it shall
be paid to him under any method specified in §7.3 selected by the Participant.

 

(3)                                  Payment
Upon Death.  In the event of the
death of a Participant prior to the commencement of benefit payments hereunder,
the Participant’s non-forfeitable Account balance shall be paid to the
Beneficiary designated by the Participant in accordance with the provisions of
§7.4.  The death benefit payable pursuant
to this §7.2(3) shall be paid either (i) in a lump sum, or (ii) in equal
monthly installments over a fixed period of years, provided such fixed period
does not exceed the life expectancy of such designated Beneficiary.  The method of payment shall be specified in
the Beneficiary designation, or, if not specified therein, may be selected by
the Beneficiary, or if the Beneficiary is a minor, by the Beneficiary’s legal
guardian.  In the event the designated
Beneficiary elects

 

A-3

 

option (ii) immediately above and dies prior to receiving the entire
amount credited to the deceased Participant’s non-forfeitable Account, the
balance of said non-forfeitable Account shall be distributed to the estate of
the designated Beneficiary as soon as practicable following such Beneficiary’s
death.  Notwithstanding anything herein
to the contrary, if the Participant’s non-forfeitable Account balance as of the
date of death does not exceed $3,500, the Committee shall pay the Participant’s
non-forfeitable Account balance to his designated Beneficiary in a lump sum as
soon as practicable following the Participant’s death; provided, however, that
for the Plan Year commencing March 31, 1998 and for all Plan Years thereafter,
the $3,500 referred to herein shall be increased to $5,000.

 

§7.3                          Methods
of Distribution.  Distribution of
amounts payable under §7.2(1) or (2) shall be made in one of the following
methods:

 

(a)                                  in
a lump sum; or

 

(b)                                 in
substantially equal monthly installments over a fixed number of years not
extending beyond the life expectancy of the Participant or the life expectancy
of the Participant and a designated Beneficiary.

 

The Committee may provide for such
installments by the purchase and distribution to the Participant of a contract
providing for such installments, or may pay such installments directly from the
Trust.

 

If the Participant commences to receive his
vested Account in installments and dies after his Required Beginning Date (as
defined in §7.6(b)), the remaining installments shall be paid to the
Participant’s designated Beneficiary at least as rapidly as under the method of
payment selected by the Participant and in accordance with Section 401(a)(9) of
the Code and the regulations promulgated thereunder; provided, however, that
the Beneficiary may elect to receive the remaining installments in a single
lump sum payment.  If the Participant
commences to receive his vested Account in installments and dies prior to his
Required Beginning Date, the remaining installments shall be distributed in
accordance with §7.7.

 

(c)                                  The
Committee may, with the prior written consent of the Participant, transfer part
or all of the Trust assets credited to his Account, to the Trustees of another
plan qualified under either Section 401(a) or Section 403(a) of

 

A-4

 

the Code, which will accept such transfer on behalf
of the Participant.

 

(d)                                 Notwithstanding
anything in this Article to the contrary, in the event the Participant’s entire
non-forfeitable Account balance does not exceed $3,500, the Committee shall pay
the Participant a lump sum as soon as practicable following the Participant’s
termination of employment; provided, however, that for the Plan Year commencing
March 31, 1998 and for all Plan Years thereafter, the $3,500 referred to herein
shall be increased to $5,000.

 

§7.6                          Notification.  The Committee shall provide each Participant
whose vested Account exceeds $5,000 with a notice of distribution no later than
thirty (30) days and no more than ninety (90) days prior to the date on which
distributions are scheduled to commence. 
Said notice shall set forth a general description of the material
features and an explanation of the relative values of, the optional forms of
distribution set forth under §7.2 in a manner that would satisfy the notice
requirements of Section 417(a)(3) of the Code and the regulations promulgated
thereunder, and shall also inform the Participant of his right, if any, to
defer the commencement of his distribution. 
If a distribution is one to which §§401(a)(11) and 417 of the Code do
not apply, such distribution may commence less than thirty (30) days after such
notice is provided by the Committee, provided that the notice clearly informs
the Participant of his right to a period of at least thirty (30) days after
receiving the notice to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular distribution option), and the
Participant, after receiving the notice, affirmatively elects a distribution.
Anything herein to the contrary notwithstanding, except as provided in §7.7
below, (a) no benefit shall be payable under the Plan to any Participant or
Beneficiary hereunder unless and until such Participant or Beneficiary shall
submit a written application therefor, on a form provided by the Committee,
specifying the method in which such benefit is to be paid, and (b) in the event
that there shall be a change in the investment funds available to Participants
pursuant to §11.1 or a change in the Plan Trustee, distributions under the Plan
may be suspended to the extent necessary to accomplish such changes.”

 

(d)                                 Section
7.10(e)(iv) read as follows until ninety (90)days after the date this amended
and restated Plan is adopted:

 

A-5

 

“(iv) Eligible Rollover Distribution means any distribution from
the Plan to a Distributee, except that such term shall not include (A) any
portion of a distribution which is attributable to Voluntary Contributions, (B)
any distribution which is one of a series of substantially equal periodic
payments, not less frequently than annually, made (1) for the life (or life
expectancy) of the Participant or the joint lives (or life expectancies) of the
Participant and his designated Beneficiary, or (2) for a specified period of
ten (10) years or more, (C) any distribution to the extent such distribution is
required under §7.7, and (D) any hardship distribution made from a Participant’s
Pre-Tax Contribution Account under §8.1(b).”

 

(e)                                  The
last sentence of Section 7.4 read as follows until March 31, 1998:

 

“Notwithstanding anything herein to the contrary, if the Participant’s
non-forfeitable Account balance as of the date of death does not exceed $3,500,
the Committee shall pay the Participant’s non-forfeitable Account balance to
his designated Beneficiary in a lump sum as soon as practicable following the
Participant’s death; provided, however, that for the Plan Year commencing March
31, 1998 and for all Plan Years thereafter, the $3,500 referred to herein shall
be increased to $5,000.”

 

(f)                                    The
last sentence of Section 9.1(b) read as follows until March 31, 1998:

 

“Notwithstanding anything in this Plan to the contrary, for the Plan
Year commencing March 31, 1998 and for all Plan Years thereafter, the $3,500
referred to above shall be increased to $5,000.”

 

(g)                                 Article
XIII read as follows until ninety (90)days after the date this amended and
restated Plan is adopted:

 

ARTICLE XIII

SPECIAL
SITUATIONS

 

§13.1                    Definitions.  Solely for the purposes of this Article XIII,
the following definitions shall apply:

 

(1)                                  Annuity
Starting Date means (a) the first day of the first period for which a
Transferred Employee’s benefits under this Article are payable as an annuity,
or (b) in the event the Transferred Employee’s benefits under this Article are
not payable as an annuity, the first day on

 

A-6

 

which all events have occurred which entitle
the Participant to such benefits.

 

(2)                                  Prior
Company means Software International Corporation, BPI Systems, Inc., UCCEL
Corporation, Applied Data Research, Inc., Cullinet Software, Inc., DBMS, Inc.,
CompuSystems, Inc., On-Line Software International, Inc., Pansophic Systems,
Incorporated, Nantucket Corporation, The ASK Group, Inc., Newtrend L.P., Legent
Corporation, Kindle Incorporated, Digital Equipment Corporation, Cheyenne
Software, Inc., Preferred Systems, Inc., CapaCity Software Corporation, AI
Ware, Inc., Avalan Technology, Inc., or Systems Start-Up, Ltd., whichever is
applicable.

 

(3)                                  Prior
Plan means the Software International Corporation Retirement/Savings Plan
and Trust as amended and restated effective September 1, 1985, and as
thereafter amended (hereinafter referred to as the “Software Plan”), the BPI
Systems, Inc. Deferred Profit Sharing Plan and Trust as adopted by BPI Systems,
Inc. effective December 17, 1985, and as thereafter amended (hereinafter
referred to as the “BPI Plan”), the UCCEL Corporation Savings Plus Plan as
effective January 1, 1985, and as thereafter amended (hereinafter referred to
as the “UCCEL Plan”), the ADR Savings and Security Plan as amended and restated
effective February 1, 1988, and as thereafter amended (hereinafter referred to
as the “ADR Plan”), the Cullinet Software, Inc. Profit Sharing Retirement Plan
as amended and restated effective May 1, 1987, and as thereafter amended, the
DBMS, Inc. 401(k) Plan as amended and restated effective September 1, 1989, and
as thereafter amended, the CompuSystems, Inc. Retirement Savings Plan as
effective March 1, 1989, and as thereafter amended (hereinafter referred to as
the “CompuSystems Plan”), the On-Line Software International, Inc. Capital
Accumulation Plan as amended and restated effective January 1, 1989, and as
thereafter amended (hereinafter referred to as the “On-Line Plan”), the
Pansophic Systems, Incorporated Profit-Sharing/Savings Investment Plan as
effective October 1, 1990, and as thereafter amended (hereinafter referred to
as the “Pansophic Plan”), the Nantucket Corporation 401(k) Profit Sharing Plan
as effective January 1, 1991, and as thereafter amended (hereinafter referred
to as the “Nantucket Plan”), The ASK Group 401(k) Plan as amended and restated
effective January 1, 1992, and as thereafter amended (hereinafter referred to
as the “ASK Plan”), the Newtrend L.P. 401(k) Savings Plan as amended and
restated effective January 1, 1989, and as thereafter amended (hereinafter
referred to as the “Newtrend Plan”), the Legent Retirement Security Plan as
amended and restated effective October 1, 1992, and as thereafter amended
(hereinafter referred to as the “Legent Plan”), the Cheyenne Software, Inc.
401(k) Plan as amended

 

A-7

 

and restated effective July 1, 1995, and as
thereafter amended (hereinafter referred to as the “Cheyenne Plan”), or the
Preferred Systems, Inc. 401(k) Savings Plan as effective January 1, 1996, and
as thereafter amended (hereinafter referred to as the “Preferred Systems Plan”),
whichever is applicable with respect to a Transferred Employee.

 

(4)                                  Transferred
Employee means an Employee who was employed by the Prior Company
immediately before he became an Employee.

 

§13.2                    Eligibility
of Transferred Employees.  A
Transferred Employee shall become a Participant in accordance with the
provisions of Article III hereof.  In
applying Article III to Transferred Employees, Periods of Service shall include
service with the Prior Company determined in accordance with the applicable
provisions of the Prior Plan, if any.

 

§13.3                    Prior Plan
Accounts and Joint and Survivor Annuity Accounts.  Amounts which are transferred to the Plan
from the Prior Plan (the “Rollover Contributions”) shall be allocated to the
Rollover Contribution Account of the Transferred Employee; provided, however,
that in the event any portion of the Rollover Contributions are subject to the
provisions of Section 417 of the Code, said portion of the Rollover
Contributions, if any, shall be allocated to a separate account for each
Transferred Employee, hereinafter referred to as the “Joint and Survivor
Annuity Account”.  Each Joint and
Survivor Annuity Account shall be credited or charged with Net Income or Net
Loss in the manner described in §5.3.

 

§13.4                    Vesting of
Transferred Employees.        Each Transferred Employee
shall at all times be one hundred (100%) percent vested in his Rollover
Contribution Account and Joint and Survivor Annuity Account, if any.  Any Contributions made under this Plan on
behalf of or by a Transferred Employee shall be vested in accordance with the
provisions of Article VI hereof.  A
Transferred Employee’s vesting service under the Plan shall include service
with the Prior Company, if any, determined in accordance with the applicable
provisions of the Prior Plan, if any.

 

§13.5                    Distribution
of Accounts of Transferred Employees.

 

(1)                                  Except
as otherwise provided in the following paragraphs, the Account balance of each
Transferred Employee shall be distributed in accordance with the provisions of
Article VII.

 

(2)                                  (a)
If a Transferred Employee is married at the time of distribution, such
Transferred Employee’s Joint and Survivor

 

A-8

 

Annuity Account shall, subject to the provisions of §7.3(d), be
distributed hereunder in the form of an annuity purchased with the entire Joint
and Survivor Annuity Account of the Transferred Employee (i) which is payable
for the lifetime of the Transferred Employee with a survivor annuity for the
lifetime of the Transferred Employee’s spouse equal to at least fifty (50%)
percent of the annuity payable during the joint lives of the Transferred
Employee and the Transferred Employee’s spouse, and (ii) which is the actuarial
equivalent of a single life annuity payable for the lifetime of the Transferred
Employee that could have been purchased by utilizing the Transferred Employee’s
entire Joint and Survivor Annuity Account (hereinafter the “Qualified Joint and
Survivor Annuity”), unless the Transferred Employee elects otherwise pursuant
to the provision of paragraph (c).

 

(b)                                 If
a Transferred Employee is not married at the time of distribution, such
Transferred Employee’s Joint and Survivor Annuity Account shall, subject to the
provisions of §7.3(d), be distributed hereunder in the form of a single life
annuity purchased with the entire Joint and Survivor Annuity Account of the
Transferred Employee (hereinafter the “Annuity”), unless the Transferred
Employee elects otherwise pursuant to the provisions of paragraph (c).  The term Annuity shall, wherever it appears
hereinafter, mean an annuity purchased with the Transferred Employee’s entire
Joint and Survivor Annuity Account, which is payable for the lifetime of the
Transferred Employee.

 

(c)                                  A
Transferred Employee may elect, in writing, during an election period
commencing ninety (90) days prior to his Annuity Starting Date, to waive his
right to a Qualified Joint and Survivor Annuity or Annuity, as applicable, and
to have his Joint and Survivor Annuity Account payable under one of the
applicable distribution options set forth in Article VII and may revoke
said election, in writing, at any time prior to the end of said election
period.  The number of revocations and
subsequent new elections shall not be limited, and any new election must comply
with the requirements of this paragraph (c). In the case of a married
Transferred Employee, an election shall not be given effect unless the Transferred
Employee’s spouse consents, in writing, to the election during the ninety (90)
day election period described above. 
Such spousal consent shall acknowledge the effect of the election on the
spouse’s rights to benefits under the Plan, and the optional form of benefit
and non-spouse Beneficiary, if any, designated by the Transferred Employee
under the optional form of benefit, including any class of Beneficiaries or
contingent Beneficiaries, which designations may not be changed without spousal
consent (unless such spousal consent expressly permits such designations
without any requirement

 

A-9

 

of further consent by the spouse or unless
the Participant changes his election to the Qualified Joint and Survivor
Annuity).  Such spousal consent shall be
witnessed by a notary public.  Spousal
consent to the election or to a subsequent change in the optional form of
benefit or non-spouse Beneficiary shall not be required if it is established to
the satisfaction of the Plan Administrator that such spousal consent cannot be
obtained because (i) there is no spouse, (ii) the spouse cannot be located,
(iii) the Participant is legally separated or has been abandoned (within the
meaning of local law) and the Participant has a court order to such effect, or
(iv)  of such other circumstances as the
Secretary of the Treasury may, by regulations or otherwise, prescribe.  In the event the Participant’s spouse is
legally incompetent to give such spousal consent hereunder, the spouse’s legal
guardian, even if such guardian is the Participant, may give such consent.  A former spouse’s consent shall not be
binding on a new spouse.  Spousal consent
to the Transferred Employee’s revocation of an election to waive the Qualified
Joint and Survivor Annuity shall not be required.  A former spouse’s consent shall not be
binding on a new spouse.

 

(d)                                 The
Committee shall, no later than thirty (30) days and no more than ninety (90)
days prior to the Annuity Starting Date, provide each Transferred Employee
whose vested Account exceeds $3,500 and on whose behalf a Joint and Survivor
Annuity Account is maintained under the Plan with a written explanation of:

 

(i)                                     the
terms and conditions of the Qualified Joint and Survivor Annuity or Annuity;

 

(ii)                                  the
Transferred Employee’s right to elect another form of benefit, and the effect
of such election;

 

(iii)                               the
rights of the Transferred Employee’s spouse with respect to the Qualified Joint
and Survivor Annuity, and any election not to receive benefits in such form;

 

(iv)                              the
Transferred Employee’s right to revoke any election not to receive benefits in
the form of a Qualified Joint and Survivor Annuity or Annuity and the effect of
such revocation;

 

(v)                                 the
material features and relative values of the optional forms of benefit
available under the Plan; and

 

A-10

 

(vi)                              the
Transferred Employee’s right, if any, to defer the commencement of his
distribution.

 

Notwithstanding anything herein to the contrary, if a Transferred
Employee, after having received the aforesaid written explanation,
affirmatively elects a form of distribution and such Transferred Employee’s
spouse consents to such distribution, if necessary, in the manner described in
§13.5(2)(c), the Annuity Starting Date may be less than thirty (30) days after
said written explanation is provided to the Transferred Employee, provided (A)
the Committee provides information to the Transferred Employee clearly
indicating that he has a right to at least thirty (30) days to consider whether
to waive the Qualified Joint and Survivor Annuity and consent to a form of
distribution other than the Qualified Joint and Survivor Annuity, (B) the
Transferred Employee is permitted to revoke an affirmative distribution election
at least until the Annuity Starting Date, or, if later, at any time prior to
the expiration of the seven-day period that begins the day after the
explanation of the Qualified Joint and Survivor Annuity is provided to the
Transferred Employee,(C) the Annuity Starting Date is after the date the
aforesaid written explanation is provided to the Transferred Employee;
provided, however that the Annuity Starting Date may be before the date that
any affirmative election is made by the Transferred Employee and before the
date the distribution may commence under (D) below, and (D) distribution in
accordance with the affirmative election does not commence before the
expiration of the seven-day period that begins the day after the written
explanation is provided to the Transferred Employee.

 

(e)                                  The
rights of any spouse or Beneficiary hereunder shall be extinguished to the
extent that such rights are in conflict with the provisions of any domestic
relations order which is a “Qualified Domestic Relations Order” within the
meaning of Section 206(d)(3)(A) of ERISA.

 

(3)                                  (a)                                  If
a married Transferred Employee shall die prior to his Annuity Starting Date,
the deceased Transferred Employee’s Joint and Survivor Annuity Account shall be
applied toward the purchase of a lifetime annuity for such Transferred Employee’s
spouse (hereinafter the “Pre-Retirement Survivor Annuity”), unless such
Transferred Employee elects otherwise pursuant to the election procedure set
forth in paragraphs (b) and (c) below. 
Annuity payments to the spouse shall commence no later than the first
day of the month following the date the Transferred Employee would have
attained his Normal Retirement Age, or, if later, the date the Transferred
Employee died; provided, however, that upon written request from the spouse,
the annuity may be

 

A-11

 

paid commencing as of the first day of any
month following the Transferred Employee’s death.  Notwithstanding the above, the Committee
shall distribute the Transferred Employee’s entire Account to the surviving
spouse in a lump sum as soon as practicable following the Transferred Employee’s
death in the event such Account does not exceed $3,500, and, to the extent
permitted by law, the surviving spouse may elect to receive the deceased
Transferred Employee’s entire Account in accordance with the provisions of
§7.2(3), in lieu of the Pre-retirement Survivor Annuity described in this
paragraph (a).

 

(b)                                 A
Transferred Employee on whose behalf a Joint and Survivor Annuity Account is
maintained may elect to waive the Pre-retirement Survivor Annuity described in
paragraph (a) above and designate a Beneficiary other than his spouse, during
the election period described in paragraph (c) below.  If the Transferred Employee elects to waive
the Pre-retirement Survivor Annuity, then, in the event of the death of the
Transferred Employee prior to his Annuity Starting Date, the deceased
Transferred Employee’s Joint and Survivor Annuity Account shall be distributed
in accordance with the provisions of §7.2(3) hereof.  A waiver by a Transferred Employee of the
Pre-retirement Survivor Annuity shall not be effective unless the Transferred
Employee’s spouse consents in writing to such waiver during the election period
described in paragraph (c) below.  Such
spousal consent shall acknowledge the effect of the waiver on the spouse’s
rights to benefits under the Plan, and the specific non-spouse Beneficiary, if
any, designated by the Transferred Employee, including any class of
Beneficiaries or contingent Beneficiaries, which designations may not be
changed without the spouse’s consent (unless such spousal consent expressly
permits such changes without any requirement of further consent by the spouse
or unless the Transferred Employee charges his election to the Pre-Retirement
Spouse’s Annuity).  Such spousal consent
shall be witnessed by a notary public. 
Spousal consent to a waiver of the Pre-retirement Survivor Annuity or to
a subsequent change in Beneficiary shall not be required if it is established
to the satisfaction of the Committee that such spousal consent cannot be
obtained because (i) there is no spouse, (ii) the spouse cannot be located,
(iii) the Participant is legally separated or has been abandoned (within the
meaning of local law) and the Participant has a court order to such effect or
(iv) of such other circumstances as the Secretary of the Treasury may, by
regulations or otherwise, prescribe.  In
the event the Participant’s spouse is legally incompetent to give such spousal
consent hereunder, the spouse’s legal guardian, even if such guardian is the
Participant, may give such consent. 
Spousal consent to the Transferred Employee’s revocation of a waiver of
the Pre-retirement Survivor Annuity under

 

A-12

 

paragraph (c) below is not required.  A former spouse’s consent shall not be
binding on a new spouse.

 

(c)                                  Each
Transferred Employee on whose behalf a Joint and Survivor Annuity Account is
maintained shall have the right to waive the Pre-retirement Survivor Annuity in
accordance with paragraph (b), and to revoke said waiver during an election
period commencing on the first day of the Plan Year in which the Transferred
Employee attains age thirty-five (35), or, if later, on the date the
Transferred Employee first becomes a Participant, and ending on the date of the
Transferred Employee’s death; provided, however, that if the Transferred
Employee’s employment with the Employer is terminated, the election period
shall commence no later than the date of termination of employment with respect
to amounts in the Joint and Survivor Annuity Account prior to such date.  The number of revocations, and subsequent new
waivers shall not be limited.  Any new
waivers shall comply with the requirements of paragraph (b) above and this
paragraph (c).

 

(d)                                 The
Committee shall provide to each Transferred Employee on whose behalf a Joint
and Survivor Annuity Account is maintained, within the period beginning with
the first day of the Plan Year in which the Transferred Employee attains age
thirty-two (32) and ending on the last day of the Plan Year in which the
Transferred Employee attains age thirty-four (34), a written explanation of:

 

(i)                                     the
terms and conditions of the Pre-retirement Survivor Annuity;

 

(ii)                                  the
Transferred Employee’s right to waive the Pre-retirement Survivor Annuity and
the effect of such waiver;

 

(iii)                               the
rights of the Transferred Employee’s spouse with respect to the Pre-retirement
Survivor Annuity and any waiver thereof, and any designation of a Beneficiary
other than the spouse; and

 

(iv)                              the
Transferred Employee’s right to revoke any waiver of the Pre-retirement
Survivor Annuity and the effect of such revocation;

 

provided, however, that if the Transferred Employee becomes a
Participant after attaining age thirty-two (32), said written explanation shall
be provided to him by the end of the three (3) year period beginning with the
first day of the Plan Year of his entry, or, if the Transferred Employee
terminates service prior to age thirty-two (32), said

 

A-13

 

written explanation shall be provided to him within one (1) year
following such termination.

 

(4)                                  (a)                                  Except
as otherwise provided in this §13.5, the methods of distribution set forth in
§7.3 shall include a life annuity with respect to any Transferred Employee who
was a former participant in the Software Plan or the UCCEL Plan; provided,
however, that if such Transferred Employee is married at the time of
distribution and elects a life annuity as the method of distribution, such
Transferred Employee’s distribution shall be paid in the form of a Qualified
Joint and Survivor Annuity as described in paragraph (2)(a) above, unless the
Transferred Employee elects otherwise pursuant to the provisions of paragraph
(2)(c) above.

 

(b)                                 Except
as otherwise provided in §7.1(1) and §7.3(d), a Transferred Employee who was a
former participant in the ADR Plan and who terminates employment with the
Employer other than by reason of retirement, disability or death, may elect to
have his Rollover Contribution Account paid to him no later than sixty (60)
days following the end of the Plan Year in which his employment terminates
under the method specified in §7.3(b); provided, however, that if such Transferred
Employee does not make the preceding election, or the election set forth in
§7.1(1), such Transferred Employee’s vested Account balance shall be held in
the Fund until he reaches Normal Retirement Age, at which time it shall be paid
to him under any method specified in §7.3.

 

(c)                                  Except
as otherwise provided in §7.3(d) and §7.6, a Transferred Employee who was a
former participant in the ADR Plan may elect to defer the distribution of his
Rollover Contribution Account for a specified number of calendar months up to
one (1) year following such Transferred Employee’s termination of employment
with the Employer, in which case such Rollover Contribution Account shall be
distributed to him in a lump sum.

 

(d)                                 Except
as otherwise provided in §7.1(1) and §7.3(d), a Transferred Employee who was a
former participant in the On-Line Plan and who terminates employment with the
Employer prior to his Normal Retirement Age or due to Disability (before his
attainment of Normal Retirement Age), may elect to defer the distribution of
his Rollover Contribution Account until the later of (i) the date he attains
age sixty-two (62) or (ii) the later of (A) the date he attains age sixty (60)
or (B) the fifth anniversary of the date he commenced participation in the
On-Line Plan.

 

A-14

 

(5)                                  Notwithstanding
any other provision in this Plan to the contrary and except as otherwise
provided in §7.1(1) and §7.3(d), the subparagraphs set forth below shall apply
solely with respect to the Rollover Contribution Account of any Transferred
Employee who was a former participant in the CompuSystems Plan.

 

(a)                                  The
methods of distribution set forth under §7.3 shall include the following:

 

(i)                                     a
straight life annuity;

 

(ii)                                  a
single life annuity with a period certain of five (5), ten (10) or fifteen (15)
years, as elected by the Participant;

 

(iii)                               a
single life annuity with installment refund;

 

(iv)                              a
survivorship life annuity with installment refund and survivor percentages of
fifty (50), sixty-six and two-thirds (66-2/3) or one hundred (100);

 

(v)                                 a
fixed period annuity for any period of whole months which is not less than
sixty (60) and does not exceed the life expectancy of the Participant and his
designated Beneficiary, where life expectancy is not recalculated; and

 

(vi)                              a
series of installments elected by the Participant with a minimum payment each
year beginning with the year during which the Participant attains age seventy
and one-half (70-1/2).  The payment for
the first year in which a minimum payment is required under this option shall
be made by April 1 of the following calendar year and the payment for the
second year and each succeeding year shall be made by December 31 of that
year.  The minimum payment shall be based
on a period equal to the joint and last survivor expectancy of the Participant
and the Participant’s spouse, if any, where the joint and last survivor
expectancy is recalculated.  If a
Participant dies before receiving all installment payments due under this
option, any remaining installments shall be paid to the Participant’s
Beneficiary in one lump sum.  If a
Transferred Employee elects this method of distribution, he may elect on any
later date to have the balance of his Rollover Contribution Account paid under
any

 

A-15

 

of the optional forms set forth above, including a single lump sum
distribution.

 

(b)                                 If
the Transferred Employee elects an annuity under subparagraph (a) above and is
married at the time distributions commence, distributions of his Rollover
Contribution Account shall be made in the form of a Qualified Joint and
Survivor Annuity as described in paragraph (2)(a) above, unless such Employee
elects otherwise in accordance with the spousal consent provisions set forth in
paragraph (2)(c) above.

 

(c)                                  (i)                                     If
the Transferred Employee terminates employment with the Employer on or after
Normal Retirement Age, Early Retirement Age (as defined herein) or due to
Disability, distributions shall commence in accordance with §7.2(1) or (2),
whichever is applicable; provided, however, that the Transferred Employee may
elect to defer the distribution of his Rollover Contribution Account until the
latest date distributions are required to commence under §7.6.  For purposes of this subparagraph (c)(i),
Early Retirement Age means, with respect to a Transferred Employee hereunder,
the first day of the month coinciding with or first following the date such
Employee terminates employment with the Employer on or after the later of the date
he attains age fifty-five (55) or his completion of seven (7) Years of Service
for vesting purposes, and prior to his Normal Retirement Age.

 

(ii)                                  If
a Transferred Employee terminates employment with the Employer other than by
reason of retirement, disability or death, distributions shall be made in
accordance with §7.1(1); provided, however, that (A) the forms of distribution
under said Section shall, with respect to such Employee’s Rollover Contribution
Account, include the methods of distribution set forth under subparagraph (a)
above, and (B) such Transferred Employee may elect to defer the distribution of
his Rollover Contribution Account until the latest date distributions are
required to commence under §7.6.  If such
Transferred Employee terminates employment with at least seven (7) Years of
Service for vesting purposes, the Transferred Employee may elect to commence
the distribution of his Rollover Contribution Account upon his attainment of
age fifty-five (55).

 

(iii)                               If
a Transferred Employee remains in employment with the Employer on or after his
Normal Retirement Age, such Employee may elect to commence the distribution of
his Rollover Contribution Account at

 

A-16

 

such Age, regardless of whether the Employee has terminated employment
with the Employer.

 

(d)                                 If
the Transferred Employee dies prior to the commencement of benefit payments,
the forms of distribution set forth under §7.2(3) shall include the methods set
forth under subparagraph (a) above, except that a series of installments shall
not be available under subparagraph (a) above if the Beneficiary is not the
Transferred Employee’s surviving spouse.

 

(6)                                  Except
as otherwise provided in §7.1(1) and §7.3(d), the subparagraphs set forth below
shall apply solely with respect to the Rollover Contribution Account of any
Transferred Employee who was a former participant in the Pansophic Plan.

 

(a)                                  The
methods of distribution which such Transferred Employee may elect upon
termination of employment for any reason set forth under §7.1, §7.2(1) or
§7.2(2) shall include the following:

 

(i)                                     a
lump sum;

 

(ii)                                  substantially
equal annual or semi-annual installments over a fixed number of years not
extending beyond the life expectancy of the Transferred Employee or the life
expectancy of the Transferred Employee and a designated Beneficiary; or

 

(iii)                               a
life annuity;  provided, however that if
such Transferred Employee is married at the time of distribution and elects to
receive his Rollover Contribution Account under this life annuity option, such
Transferred Employee’s Rollover Contribution Account shall be paid in the form
of a Qualified Joint and Survivor Annuity as described in paragraph (2)(a)
above, unless the Transferred Employee elects otherwise pursuant to the
provisions of paragraph (2)(c) above.

 

(b)                                 If
such Transferred Employee dies prior to the commencement of benefit payments,
the forms of distribution set forth under §7.2(3) shall include the following:

 

(i)                                     substantially
equal annual or semi-annual installments over a fixed number of years not
extending beyond the life expectancy of the designated Beneficiary; or

 

(ii)                                  a
life annuity.

 

A-17

 

(7)                                  Except
as otherwise provided in §7.1(1) and §7.3(d), the subparagraphs set forth below
shall apply solely with respect to the Rollover Contribution Account of any
Transferred Employee who was a former participant in the Nantucket Plan.

 

(a)                                  The
methods of distribution which such Transferred Employee may elect upon
termination of employment for the reasons set forth under §7.1 shall include
the installment method set forth under §7.3(b).

 

(b)                                 Upon
termination of employment for any reason set forth under §7.1, §7.2(1) or
§7.2(2), the Transferred Employee may elect to defer the distribution of his
Rollover Contribution Account until the April 1 following the date upon which
he attains age seventy and one-half (70-1/2).

 

(8)                                  Except
as otherwise provided in §7.1(1), §7.2(3) and §7.3(d), the subparagraphs set
forth below shall apply solely with respect to the Rollover Contribution
Account of any Transferred Employee who was a former participant in the ASK
Plan.

 

(a)                                  The
methods of distribution available to such Transferred Employee, or if
applicable, his designated Beneficiary, under §7.1 and §7.2 shall include equal
monthly, quarterly or annual installments over a fixed number of years not
extending, in the case of a Participant, beyond the life expectancy of the
Participant or the life expectancy of the Participant and a designated
Beneficiary, and, in the case of a designated Beneficiary, beyond the life
expectancy of the designated Beneficiary.

 

(b)                                 Such
Transferred Employee may elect to commence the distribution of his Rollover
Contribution Account at any time after his termination of employment and prior
to his Normal Retirement Age.  Any such
election shall be in writing on such forms as may be prescribed by the
Committee.

 

(c)                                  Such
Transferred Employee may, at any time after attainment of age 59-1/2, elect to
withdraw all or a portion of his Rollover Contribution Account from the Plan,
in accordance with the procedures set forth in §8.1(3).

 

(9)                                  Except
as otherwise provided in §7.1(1), §7.2(3) and §7.3(d), the subparagraphs set
forth below shall apply solely with respect to the Rollover Contribution
Account, including any Joint and Survivor Annuity

 

A-18

 

Account as described in §13.3, of any Transferred Employee who was a
former participant in the Newtrend Plan.

 

(a)                                  (i)                                     The
methods of distribution available to such Transferred Employee, or, if
applicable, his designated Beneficiary, under §7.1 and §7.2 shall include equal
monthly, quarterly, semiannual or annual installments over a fixed number of
years not extending, in the case of a Participant, beyond the life expectancy
of the Participant or the life expectancy of the Participant and a designated
Beneficiary, and, in the case of a designated Beneficiary, beyond the life
expectancy of the designated Beneficiary.

 

(ii)                                  The
Qualified Joint and Survivor Annuity described in §13.5(2)(a) shall include an
annuity payable for the lifetime of the Transferred Employee with a survivor
annuity for the lifetime of the Transferred Employee’s surviving spouse equal
to, pursuant to the Participant’s election, seventy-five percent (75%) or one
hundred percent (100%) of the annuity payable during the joint lives of the
Transferred Employee and the Transferred Employee’s spouse and which is equal
in value to the Qualified Joint and Survivor Annuity described in §
13.5(2)(a).  Notwithstanding anything in
this §13.5(9) to the contrary, the provisions of this subparagraph (ii) shall
apply only with respect to the Transferred Employee’s Joint and Survivor
Annuity Account, if any.

 

(b)                                 Such
Transferred Employee may elect to commence the distribution of his Rollover
Contribution Account at any time after his termination of employment and prior
to his Normal Retirement Age.  Any such
election shall be in writing on such forms as may be prescribed by the
Committee.

 

(10)                            Except
as otherwise provided in §7.1(1), §7.2(3) and §7.3(d), the subparagraphs set
forth below shall apply solely with respect to the Rollover Contribution
Account, including any Joint and Survivor Annuity Account as described in
§13.3, of any Transferred Employee who was a former participant in the Legent
Plan.

 

(a)                                  The
methods of distribution available to such transferred Employee under §7.1,
§7.2(1), or §7.2(2) shall include the following and shall be subject to the
provisions set forth in §13.5(2):

 

A-19

 

(i)                                     the
Qualified Joint and Survivor Annuity or Annuity, whichever is applicable, as
set forth under §13.5(2) purchased with the Transferred Employee’s entire
Rollover Contribution Account (including any Joint and Survivor Annuity
Account); provided, however, that the Qualified Joint and Survivor Annuity
shall include an annuity for the lifetime of the Transferred Employee with a
survivor annuity equal to, at the Transferred Employee’s election, one hundred
(100%) percent (instead of fifty 50%)percent) of the annuity payable during the
joint lives of the Transferred Employee and the Transferred Employee’s spouse
and which is the actuarial equivalent of a single life annuity payable for the
lifetime of the Transferred Employee that could have been purchased utilizing
the Transferred Employee’s entire Rollover Contribution Account (including any
Joint and Survivor Annuity Account);

 

(ii)                                  a
single lump sum;

 

(iii)                               an
annuity purchased with the Transferred Employee’s entire Rollover Contribution
Account(including any Joint and Survivor Annuity Account) which is payable
monthly for the lifetime of the Transferred Employee and which ceases upon the
death of the Transferred Employee;

 

(iv)                              substantially
equal monthly, quarterly,                                   semi-annual
or annual installments over a fixed number of years not extending beyond the
life expectancy of the Transferred Employee or the life expectancy of the
Transferred Employee and a designated Beneficiary;

 

(v)                                 an
annuity purchased with the Transferred Employee’s entire Rollover Contribution
Account(including any Joint and Survivor Annuity Account) which is payable
monthly for the lifetime of the Transferred Employee, with one hundred twenty
(120) or two hundred forty (240)monthly payments, as elected by the Transferred
Employee, guaranteed but in no event over a period extending beyond the life
expectancy of the Transferred Employee or the life expectancy of the
Transferred Employee and a designated Beneficiary.  Upon the death of the Transferred Employee,
the remaining guaranteed payments shall be paid to the transferred Employee’s
designated Beneficiary;

 

(vi)                              an
annuity purchased with the Transferred Employee’s entire Rollover Contribution
Account(including any Joint and Survivor Annuity

 

A-20

 

Account) which is payable monthly for the lifetime of the Transferred
Employee, with a survivor annuity equal to, at the Transferred Employee’s
election, fifty (50%) percent or one hundred (100%) percent of the annuity
payable during the joint lives of the Transferred Employee and the Transferred
Employee’s designated Beneficiary and which is the actuarial equivalent of a
single life annuity payable for the lifetime of the Transferred Employee that
could have been purchased utilizing the Transferred Employee’s entire Rollover
Contribution Account (including any Joint and Survivor Annuity Account).  If the Transferred Employee’s designated
Beneficiary shall die on or after the date benefits commence hereunder to the
Transferred Employee, no alternative Beneficiary can be named; or

 

(vii)                           any
combination of the preceding as elected by the Transferred Employee.

 

(b)                                 The
provisions of §13.5(3) shall apply to such Transferred Employee’s Rollover
Contribution Account(including any Joint and Survivor Annuity Account).  In addition, the methods of distribution
available to a Transferred Employee’s Beneficiary under §7.2(3) with respect to
the Transferred Employee’s Rollover Contribution Account shall include those
methods set forth under subparagraphs (a)(ii), (iii), (iv) and (vii) above.

 

(c)                                  Notwithstanding
anything herein or the Plan to the contrary, such Transferred Employee may
elect to defer the commencement of his Rollover Contribution Account (including
any Joint and Survivor Annuity Account) until the April 1 following the date
upon which he attains age seventy and one-half (70-1/2).

 

(11)                            Except
as otherwise provided in §7.1(1), §7.2(3), and §7.3(d), a Transferred Employee
who was a former participant in the Cheyenne Plan may elect to commence the
distribution of his Rollover Contribution Account at any time after his
termination of employment and prior to his Normal Retirement Age.  Any such election shall be in writing on such
forms as may be prescribed by the Committee and in accordance with §7.5.

 

(12)                            Except
as otherwise provided in §7.1(1), §7.2(3) and §7.3(d), the methods of
distribution available under §7.1 or §7.2 with respect to the Rollover
Contribution Account of any Transferred Employee who was a former participant
in the Preferred Systems Plan shall include substantially equal monthly,
quarterly,

 

A-21

 

semi-annual or annual installments over a fixed number of years not
extending, in the case of a Participant, beyond the life expectancy of the
Participant and a designated Beneficiary, and, in the case of a designated
Beneficiary, beyond the life expectancy of the designated Beneficiary.

 

A-22

 

APPENDIX B

Elections Relating to Nondiscrimination
Testing

and Highly Compensated Employee Determination

 

1.                                       For
purposes of the nondiscrimination test set forth in Section 4.10(a)(i), the
following testing methods are elected for each of the following Plan Years:

 

	
  1997 Plan Year:

  	
  o

  	
  current year testing method

  
	
   

  	
  o

  	
  prior year testing method

  
	
   

  	
   

  	
   

  
	
  1998 Plan Year:

  	
  ý

  	
  current year testing method

  
	
   

  	
  o

  	
  prior year testing method

  
	
   

  	
   

  	
   

  
	
  1999 Plan Year:

  	
  ý

  	
  current year testing method

  
	
   

  	
  o

  	
  prior year testing method

  
	
   

  	
   

  	
   

  
	
  2000 Plan Year:

  	
  o

  	
  current year testing method

  
	
   

  	
  o

  	
  prior year testing method

  
	
   

  	
   

  	
   

  
	
  2001 Plan Year:

  	
  o

  	
  current year testing method

  
	
   

  	
  o

  	
  prior year testing method.

  

 

 

2.                                       For
purposes of determining Highly Compensated Employees under Section 4.10(a)(ii)(B),
the following elections are made relating to the application of the top-paid
group option under clause (2)(b) of said Section and the calendar year
calculation option under said Section for each of the following Plan Years:

 

(a)                                  Top-Paid
Group Option:

 

	
  1997 Plan Year:

  	
  o

  	
  top-paid group election

  
	
   

  	
  ý

  	
  no top-paid group election

  
	
   

  	
   

  	
   

  
	
  1998 Plan Year:

  	
  o

  	
  top-paid group election

  
	
   

  	
  ý

  	
  no top-paid group election

  
	
   

  	
   

  	
   

  
	
  1999 Plan Year:

  	
  o

  	
  top-paid group election

  
	
   

  	
  ý

  	
  no top-paid group election

  
	
   

  	
   

  	
   

  
	
  2000 Plan Year:

  	
  o

  	
  top-paid group election

  
	
   

  	
  o

  	
  no top-paid group election

  
	
   

  	
   

  	
   

  
	
  2001 Plan Year:

  	
  o

  	
  top-paid group election

  
	
   

  	
  o

  	
  no top-paid group election

  

 

B-1

 

(b)                                 Calendar
Year Calculation Option:

 

	
  1997 Plan Year:

  	
  ý

  	
  calendar year calculation election

  
	
   

  	
  o

  	
  no calendar year calculation election

  
	
   

  	
   

  	
   

  
	
  1998 Plan Year:

  	
  ý

  	
  calendar year calculation election

  
	
   

  	
  o

  	
  no calendar year calculation election

  
	
   

  	
   

  	
   

  
	
  1999 Plan Year:

  	
  ý

  	
  calendar year calculation election

  
	
   

  	
  o

  	
  no calendar year calculation election

  
	
   

  	
   

  	
   

  
	
  2000 Plan Year:

  	
  o

  	
  calendar year calculation election

  
	
   

  	
  o

  	
  no calendar year calculation election

  
	
   

  	
   

  	
   

  
	
  2001 Plan Year:

  	
  o

  	
  calendar year calculation election

  
	
   

  	
  o

  	
  no calendar year calculation election

  

 

3.                                       For
purposes of the nondiscrimination test set forth in Section 4.10(b)(i), the
following testing methods are elected for each of the following Plan Years:

 

	
  1997 Plan Year:

  	
  o

  	
  current year testing method

  
	
   

  	
  o

  	
  prior year testing method

  
	
   

  	
   

  	
   

  
	
  1998 Plan Year:

  	
  ý

  	
  current year testing method

  
	
   

  	
  o

  	
  prior year testing method

  
	
   

  	
   

  	
   

  
	
   

  	
  ý

  	
  current year testing method

  
	
  1999 Plan Year:

  	
  o

  	
  prior year testing method

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  current year testing method

  
	
  2000 Plan Year:

  	
  o

  	
  prior year testing method

  
	
   

  	
   

  	
   

  
	
   

  	
  o

  	
  current year testing method

  
	
  2001 Plan Year:

  	
  o

  	
  prior year testing method.

  
	
   

  	
   

  	
   

  

 

B-2

 

FIRST AMENDMENT

 

TO THE

 

 COMPUTER ASSOCIATES SAVINGS HARVEST PLAN

 

 (As Amended and
Restated Effective March 31, 1997 and adopted May 22, 2001)

 

WHEREAS,
Computer Associates International, Inc. (the “Employer”) established and
presently maintains the Computer Associates Savings Harvest Plan (the “Plan”)
for its eligible employees;

 

WHEREAS,
the Employer desires to amend the Plan to (a) reflect certain provisions of the
Economic Growth and Tax Relief Reconciliation Act of 2001 (“EGTRRA”), (b)
increase the maximum percentage by which participants can make Pre-Tax
and Voluntary Contributions under the Plan from 15% to 20%, (c) improve the
vesting schedule with respect to Employer Discretionary Contributions made for
Plan Years commencing on or after March 31, 2002, and (d) reflect the change in
the name of the Executive Committee of the Board of Directors to the Corporate
Operations Committee of the Board of Directors;

 

WHEREAS,
the EGTRRA provisions of this Amendment are intended as good faith compliance
with certain provisions of EGTRRA and are to be construed in accordance with
EGTRRA and guidance issued thereunder, including IRS Notices 2001-42 and
2001-57;

 

WHEREAS,
this Amendment shall supersede the provisions of the Plan to the extent those
provisions are inconsistent with the provisions of this Amendment; and

 

WHEREAS,
pursuant to Section 10.2(d) of the Plan, the Employer is empowered to amend the
Plan, in whole or in part;

 

NOW,
THEREFORE, the Plan is hereby amended
in the following respects:

 

1.             INCREASE IN
COMPENSATION LIMIT.  Effective
for Plan Years commencing after December 31, 2001, the following language is
inserted before the last sentence in Section 1.4(b):

 

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

 

 

calendar year applies to
annual Compensation for the determination period that begins with or within
such calendar year.”

 

2.             ELECTIVE
DEFERRALS – CONTRIBUTION LIMIT.  Effective
for calendar years commencing after December 31, 2001, the following new
paragraph (c) is hereby added to Section 4.1:

 

“(c) Notwithstanding any
provision in the Plan to the contrary, no Participant shall be permitted to
have Pre-Tax Contributions made under the Plan, or any other qualified plan
maintained by the Employer during the calendar year, in excess of the dollar
limitation contained in Section 402(g) of the Code in effect for such calendar
year, except to the extent permitted under Section 4.8 of the Plan, as amended,
and Section 414(v) of the Code.”

 

3.             INCREASED
PRE-TAX AND VOLUNTARY CONTRIBUTION PERCENTAGES. 
Effective for Plan Years commencing on or after March 31,
2002, the second sentence of Section 4.2 and the first sentence of Section 4.7
are each hereby respectively amended by deleting the phrase “fifteen percent
(15%)” therefrom and replacing it with the phrase “twenty percent (20%)”.

 

4.             CATCH-UP
CONTRIBUTIONS.  Effective for
calendar years commencing after December 31, 2001, the first paragraph set
forth in Section 4.8, including the title thereof, is hereby designated as
paragraph “(a)”, and the following new paragraph (b) is hereby added to said
Section:

 

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

 

2

 

5.             LIMITATIONS
ON CONTRIBUTIONS.  Effective
for Limitation Years commencing after December 31, 2001, the following language
is hereby added to the end of Section 4.11(a):

 

“Except to the extent
permitted under Section 4.8(b) of the Plan and Section 414(v) of the Code, the
sum of the Annual Additions (as defined in paragraph (c)) to a Participant’s
Account, when added to the Annual Additions to the account of the Participant
under any other Defined Contribution Plan (as defined in paragraph (c))
maintained by the Employer or a Related Company for any Limitation Year (as
defined in paragraph (c)), shall not exceed the lesser of: (a) one hundred
percent (100%) of the Participant’s Limitation Year Compensation, or (b)
$40,000, as adjusted for increases in the cost-of-living under Code Section 415(d)
and any Treasury Regulations or other notices or rules promulgated
thereunder.  The compensation limit
referred to in (a) shall not apply to any contribution for medical
benefits after separation from service (within the meaning of Code Section
401(h) or Code Section 419A(f)(2)) which is otherwise treated as an Annual
Addition.”

 

6.             VESTING OF
EMPLOYER MATCHING AND DISCRETIONARY CONTRIBUTIONS.  Effective with respect to
contributions for Plan Years commencing after December 31, 2001, a new subparagraph
(iii) is hereby added to the end of Section 6.2(a) to read as follows:

 

“(iii) Notwithstanding
anything in this Plan to the contrary, the Employer Matching Contribution
Account and Employer Discretionary Contribution Account of a Participant which
are attributable to Employer Matching Contributions and Employer Discretionary
Contributions made with respect to Plan Years commencing on or after March 31,
2002 shall become vested in accordance with the following schedule:

 

	
  Years of Service

  	
   

  	
  Vesting Percentage

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 2

  	
   

  	
  0

  	
  %

  
	
  2 but less than
  3

  	
   

  	
  20

  	
  %

  
	
  3 but less than
  4

  	
   

  	
  40

  	
  %

  
	
  4 but less than
  5

  	
   

  	
  60

  	
  %

  
	
  5 but less than
  6

  	
   

  	
  80

  	
  %

  
	
  6 or more

  	
   

  	
  100

  	
  %”.

  

 

7.             DISTRIBUTION
UPON SEVERANCE FROM EMPLOYMENT.  Effective
with respect to distributions and severance from employment occurring after

 

3

 

January 1, 2002
regardless of when the severance from employment occurred, and except as
otherwise provided by any applicable pronouncements or rulings, a Participant’s
vested Account shall be distributed on account of the Participant’s severance
from employment.  However, such a
distribution shall be subject to the other provisions of the Plan regarding
distributions, other than provisions that require a separation from service
before such amounts may be distributed.

 

8.             DIRECT
ROLLOVERS OF PLAN DISTRIBUTIONS.  Effective
with respect to distributions made after December 31, 2001, the following shall
apply to the direct rollover provisions in Section 7.10 of the Plan:

 

“(a)         Modification of definition of Eligible
Retirement Plan:  An Eligible Retirement
Plan shall also mean an annuity contract described in Code §403(b) and an
eligible Plan under Code §457(b) which is maintained by a state, political
subdivision of a state, or any agency or instrumentality of a state or
political subdivision of a state and which agrees to separately account for
amounts transferred into such Plan from this Plan.  The definition of Eligible Retirement Plan
shall also apply in the case of a distribution to a surviving spouse, or to a
spouse or former spouse who is the alternate payee under a qualified domestic
relation order, as defined in Code §414(p).

 

(b)           Modification of definition of
Eligible Rollover Distribution to exclude hardship distributions:  Any amount that is distributed on account of
hardship shall not be an Eligible Rollover Distribution and the Distributee may
not elect to have any portion of such a distribution paid directly to an
Eligible Retirement Plan.”

 

9.             CHANGE IN
NAME OF EXECUTIVE COMMITTEE.  Effective
May 14, 2002, the phrase “the Executive Committee of the Board of
Directors” in Section 10.2(d) is hereby amended to be “the Corporate
Operations Committee of the Board of Directors, or any successor to said
Committee.”

 

4

 

IN
WITNESS WHEREOF, Computer Associates International, Inc., as
authorized by the Corporate Operations Committee of its Board of Directors, has
caused this Amendment to be signed by its proper officer this 24th
day of March, 2003.

 

 

5

 

SECOND AMENDMENT

 

TO THE

 

COMPUTER ASSOCIATES SAVINGS HARVEST PLAN

 

(As
Amended and Restated Effective March 31, 1997 and adopted May 22, 2001)

 

WHEREAS,
Computer Associates International, Inc. (the “Employer”) established and
presently maintains the Computer Associates Savings Harvest Plan (the “Plan”)
for its eligible employees;

 

WHEREAS,
the Employer desires to amend the Plan to (a) permit the acceptance of
rollovers by employees from conduit individual retirement accounts, (b) permit
those distributions checks which are of a de minimus amount and remain uncashed
for a period of time to be forfeited into the forfeiture account under the
Plan, and (c) clarify that Matching Contributions shall apply with respect to
either Basic Pre-Tax or Basic Voluntary Contributions, or the combination of
such Contributions not in excess of five percent (5%) of the Participant’s
Compensation; and

 

WHEREAS,
pursuant to Section 10.2(d) of the Plan, the Employer is empowered to amend the
Plan, in whole or in part;

 

NOW,
THEREFORE, the Plan is hereby amended
in the following respects:

 

1.             ROLLOVERS
FROM CONDUIT IRAS.  Effective
as of the later of (a) October 1, 2003 or (b) the date the Trustee is
able to accept rollovers from conduit IRAs into the Plan, paragraph (a) of
Section 4.12 is hereby amended to ready in its entirety as follows:

 

“(a)         An Employee (whether or not a
Participant under this Plan) who has received or is entitled to receive a
distribution from a retirement plan which meets the qualification requirements
of Section 401(a) of the Code (hereinafter referred to as the “Transferor Plan”)
may, in accordance with procedures established by the Committee, roll over the
distribution from the Transferor plan to the Trust created under this Plan,
provided the rollover satisfies the applicable requirements of the Code.  Such rolled over amount shall be allocated to
the Employee’s Account hereunder in the manner described in Section 4.13 as if
said Employee were a Participant hereunder. 
Solely for the purposes of this Section 4.12 and Section 4.13, the term
Transferor Plan shall also include an individual retirement account that is
comprised solely of amounts attributable to rollovers from a retirement plan
which meets the qualification requirements of Section 401(a) of the Code, and
any interest earned on such amounts.”

 

 

2.             UNCASHED
DISTRIBUTIONS.  Effective upon
the date of a favorable determination letter issued by the Internal Revenue
Service which considers this Second Amendment, but in no event earlier that the
date of the Trustee of the Plan is able to effectuate this Item 2 of this
Second Amendment, Section 9.7 is hereby amended to read in its entirety as
follows:

 

“9.7 Participant or
Beneficiary Unable to be Found/DeMinimus Uncashed Checks.

 

Notwithstanding
anything provided in this Plan to the contrary, if (a) the Committee is unable
to direct payment of a benefit hereunder to a Participant or Beneficiary
entitled thereto because the identity or whereabouts of such person cannot be
ascertained, notwithstanding the registered or certified mailing of notice to
such person at his last known address as indicated by the records of the
Committee or the Employer, or (b) distribution checks which are of a de minimus
amount (as determined by the Committee) remain uncashed for a period of time
(as determined by the Committee), notwithstanding the mailing of notice to such
person at his last known address as indicated by the records of the Committee
or the Employer, then in the case of clause (a) hereinabove, such benefit
and any other benefits of such person payable from the Trust, and in the case
of clause (b) hereinabove, such distribution shall be forfeited and applied in
accordance with Section 6.4(c); provided, however, that such benefits or
distribution shall be reinstated upon a proper claim being made by the
Participant or Beneficiary.”

 

3.             MATCHING
CONTRIBUTIONS.  Effective for
Plan Years commencing on or after March 31, 1997, the first sentence of Section
4.4 is hereby amended to read in its entirety, as follows:

 

“Subject to the
restrictions and limitations of Sections 4.9(d), 4.10(b) and 4.11, and except
as otherwise provided herein, the Employer shall contributed to the Plan on
behalf of each Participant as a “Matching Contribution,” an amount equal to
fifty percent (50%) of (a) the Participant’s Basic Pre-Tax Contributions,
(b) the Participant’s Basic Voluntary Contributions, or (c) a
combination of the Participant’s Basic Pre-Tax and Basic Voluntary
Contributions, reduced by any amounts allocated to the Participant’s Account
pursuant to Section 6.4; provided, however, that in no event shall the Employer
Matching Contribution apply to any amount in excess of the first five percent
(5%) of the Participant’s Compensation. 
For purposes of this Section 4.4,

 

2

 

Basic Voluntary
Contributions shall mean those Voluntary Contributions made by a Participant
that are not in excess of five percent (5%) of the Participant’s
Compensation.  In no event shall the
Employer Matching Contribution for a Plan Year exceed two and one-half percent
(21⁄2%) of the Participant’s Compensation.”

 

IN
WITNESS WHEREOF, Computer Associates International, Inc., as
authorized by the Corporate Operations Committee of its Board of Directors, has
caused this Amendment to be signed by its proper officer this 2ND
day of September, 2003.

 

 

3

 

THIRD AMENDMENT

 

TO THE

 

COMPUTER ASSOCIATES SAVINGS HARVEST PLAN

 

(As
Amended and Restated Effective March 31, 1997 and adopted May 22, 2001)

 

WHEREAS,
Computer Associates International, Inc. (the “Employer”) established and
presently maintains the Computer Associates Savings Harvest Plan (the “Plan”) for
its eligible employees;

 

WHEREAS,
the Employer desires to amend the Plan to clarify the time for making
contributions under the Plan and to improve the provisions relating to the
Committee; and

 

WHEREAS,
pursuant to Section 10.2(d) of the Plan, the Employer is empowered to amend the
Plan, in whole or in part;

 

NOW,
THEREFORE, the Plan is hereby amended
in the following respects:

 

1.             Subparagraph (i) of Section 4.9(c)
is hereby amended to read in its entirety as follows:

 

“(i)          Contributions pursuant to paragraph
(a) shall be deposited into the Trust no later than the time that is as soon as
practicable following the end of the payroll period with respect to which the
Participant’s Compensation was reduced pursuant to the Salary Reduction
Agreement or payroll deduction agreement, but in no event later than the time
prescribed by law for the contribution of such amounts to the Plan; and....”

 

2.             Subparagraph (i)(A) of Section
4.11(c) is hereby amended by replacing the phrase “any forfeitures” therein
with the phrase “any amounts.”

 

3.             Paragraph (c) of Section 5.3 is
hereby amended to read in its entirety as follows:

 

“(c)         Notwithstanding paragraphs (a) and (b)
above, the amount of any Net Income or Net Loss attributable to the General
Account and other separate accounts, if any, maintained under the Trust
pursuant to Section 6(f) of the Trust Agreement entered into between Computer
Associates International, Inc. and the Trustee, as amended and restated as of
November 27, 2002, shall be credited or charged, as the case may be, to such
General Account or other separate accounts, respectively.”

 

 

4.             Section 6.4 is hereby amended as “Forfeitures
and Unallocated Trust Funds.”

 

5.             Paragraph (c) of Section 6.4 is
hereby amended by inserting the phrase “and unallocated Trust funds that have
not been credited to the Accounts of Participants as of the last day of the
Plan Year” immediately following the word “Forfeitures” in the first line
thereof.

 

6.             Subparagraph (iii) of Section
6.4(c) is hereby amended to read in its entirety as follows:

 

“(iii)        Third, if funds remain, first to the
Matching Contribution Accounts of remaining active Participants in lieu of
Matching Contributions which otherwise would have been made on or after the
date of the forfeiture, and second, in lieu of any portion, as determined by
the Committee, of any Employer Discretionary Contributions which otherwise
would have been made on or after the date of the forfeiture; and....”

 

7.             Subparagraph (iv) of Section 6.4(c)
is hereby amended to read in its entirety as follows:

 

“(iv)        Fourth, if funds remain, to the Matching
Contribution Accounts of remaining active Participants.”

 

8.             The following new paragraph (d) is
hereby added to the end of Section 6.4:

 

“(d)         Any amounts held in the Trust that have
not been credited to the Accounts of Participants under the Plan as of the last
day of the Plan Year may be applied in the manner described in paragraph (c)
above, as determined by the Committee.”

 

9.             The following new sentence is
hereby added to the end of paragraph (a) of Section 10.1:

 

“(a) Committee.  The Plan shall be administered by a Committee
consisting of at least three individuals who shall be appointed by the Board of
Directors of the Employer.  The Board of
Directors of the Employer may remove any member of the Committee from office at
any time with or without cause; provided, however, that in the event that a
member of the Committee shall also be an Employee, the termination of
employment of such Employee shall be deemed to be a removal of such member from
the Committee.  Notwithstanding anything
in this Section or the Plan to the

 

2

 

contrary, in the event
that the membership of the Committee shall become less than three individuals,
the Committee shall consist of the members then in office until the Board of
Directors shall appoint additional members. 
For purposes of this paragraph (a), the term “Employer” means
Computer Associates International, Inc. and its successors, and shall not
include any Related Company which shall have adopted the Plan.”

 

10.           Items 1 through 8 of this Amendment
shall be effective for the Plan Year ending March 30, 2004.  Item 9 of this Amendment shall be effective
as of January 27, 2004.

 

IN
WITNESS WHEREOF, Computer Associates International, Inc., as
authorized by the Corporate Operations Committee of its Board of Directors, has
caused this Amendment to be signed by its proper officer this 30th
day of March, 2004.

 

 

3

 

FOURTH AMENDMENT

 

TO THE

 

COMPUTER ASSOCIATES SAVINGS HARVEST PLAN

 

(as amended and restated
effective March 31, 1997 and adopted May 22, 2001)

 

WHEREAS, Computer Associates International, Inc. (the “Employer”)
established and presently maintains the Computer Associates Savings Harvest
Plan (the “Plan”) for its eligible employees;

 

WHEREAS, as part of the most recent determination
letter application to the Internal Revenue Service (the “Service”) relating to
the continued qualification of the Plan under Sections 401(a) and 401(k)
of the Internal Revenue Code of 1986, as amended (the “Code”), and the
continued tax-exempt status of the Trust thereunder under Section 501(a)
of the Code, this Amendment was submitted in proposed form clarifying certain
provisions of the Plan and making certain technical corrections thereto;

 

WHEREAS, pursuant to Plan Section 10.2(d), the
Committee of the Plan has the power to amend the Plan with respect to such
technical amendments; and

 

WHEREAS, the Service has issued a favorable determination
letter, which considered and approved said Amendment;

 

NOW THEREFORE, the Plan is hereby amended in the
following respects:

 

1.             Subparagraphs (iv)
and (v) on page 133 are hereby redesignated as subparagraphs (d) and
(e) respectively.

 

2.             The
language set forth in the first clause of Paragraphs 6(a), (c), and (g) of
Appendix A is hereby amended to read in its entirety as follows:

 

 

“The
following provisions shall be effective until the earlier of (i) the
ninetieth (90th) day after the date the Committee distributes a
summary to Participants that reflects the elimination of certain optional forms
of payment set forth below and that satisfies the requirements of DOL
Regulation 2520.l04b-3 for pension plans, or (ii) the first day of
the second Plan Year following the Plan Year in which this amended and restated
Plan is adopted:”

 

3.             The
language set forth in the first clause of Paragraph 6(d) of
Appendix A is hereby amended to read in its entirety as follows:

 

“Section 7.10(e)(iv) read as follows prior to
January 1, 1999:”

 

4.             Section 13.1(2)
as set forth under Paragraph 6(g) of Appendix A is hereby amended to
read in its entirety as follows:

 

“(2)         Prior
Company shall mean Software International Corporation, BPI Systems, Inc.,
UCCEL Corporation, Applied Data Research, Inc., Cullinet Software, Inc., DBMS,
Inc., CompuSystems, Inc., On-Line Software International, Inc., Pansophic
Systems, Incorporated, Nantucket Corporation, The ASK Group, Inc., Newtrend
L.P., Legent Corporation, Kindle Corporation, Digital Equipment Corporation,
Cheyenne Software, Inc., Preferred Systems, Inc., CapaCity Software
Corporation, AI Ware, Inc., Avalan Technology, Inc., Systems Start-Up, Ltd.,
Realogic, Inc., Viewpoint Datalabs, Inc., LDA Systems, Inc., Distribution
Software, Inc., Computer Management Sciences, Inc., and PLATINUM technology
international, inc. (formerly known as PLATINUM technology, inc.), whichever is
applicable.”

 

5.             The
language set forth in the last five lines of paragraph (3) of
Section 13.1 under Paragraph 6(g) of Appendix A commencing with
the word “or” is hereby deleted therefrom and the following language shall be
substituted in its place:

 

“. . . the
Preferred Systems, Inc. 401(k) Savings Plan as effective January 1, 1996,
and as thereafter amended (hereinafter referred to as the “Preferred Systems
Plan”), the Realogic, Inc. Savings Plan and Trust as amended and restated
effective April 1, 1997, and as thereafter amended (hereinafter referred
to as the “Realogic Plan”), the Viewpoint Retirement Plan as effective
January 1, 1994, and as thereafter amended (hereinafter referred to as the
“Viewpoint Plan”), the LDA Systems, Inc. Retirement Savings Plan as amended and
restated effective July 1, 1991, and as

 

2

 

thereafter amended
(hereinafter referred to as the “LDA Plan”), the Computer Management Sciences,
Inc. Profit Sharing 401(k) Plan as amended and restated effective
January 1, 1998, and as thereafter amended (hereinafter referred to as the
“CMSI Plan”), or the PLATINUM technology, inc. 401(k) Savings Plan as amended
and restated effective January 1, 1998, and as thereafter amended
(hereinafter referred to as the “Platinum Plan”), whichever is applicable with
respect to a Transferred Employee.”

 

6.             Paragraph (4)
of Section 13.1 under Paragraph 6(g) of Appendix A is hereby
amended to read in its entirety as follows:

 

“(4)         Transferred Employee shall mean
an Employee who was employed by a Prior Company immediately before he became an
Employee in connection with the acquisition of the Prior Company or a division
thereof by the Employer.”

 

7.             A
new paragraph (13) is hereby added to Section 13.5 under
Paragraph 6(g) of Appendix A, to read as follows:

 

“(13)       Except as otherwise provided in §7.1(1),
§7.2(3) and §7.3(d), the methods of distribution available with respect to the
Rollover Contribution Account of any Transferred Employee who was a former
participant in the Realogic Plan shall include the methods of distribution set
forth in paragraphs (7)(a) and (7)(b) of this §13.5.”

 

8.             A
new paragraph (14) is hereby added to Section 13.5 under
Paragraph 6(g) of Appendix A, to read as follows:

 

“(14)       Except as otherwise provided in §7.1(1),
§7.2(3) and §7.3(d), the methods of distribution available with respect to the
Rollover Contribution Account of any Transferred Employee who was a former
participant in the Viewpoint Plan shall include the method of distribution set
forth in paragraph 12 of this §13.5.”

 

9.             A
new paragraph (15) is hereby added to Section 13.5 under Paragraph 6(g)
of Appendix A, to read as follows:

 

“(15)       Except
as otherwise provided in §7.1(1), §7.2(3) and §7.3(d), the methods of
distribution available with respect to the Rollover Contribution Account of any
Transferred Employee who was a former

 

3

 

participant in the LDA
Plan shall include the methods of distribution set forth in
paragraphs (6)(a)(ii) and (iii), (7)(a), (7)(b), and (10)(a)(v) of this §13.5, and shall also include a cash
refund annuity under which such Transferred Employee’s Rollover Contribution
Account shall be used to purchase an annuity payable for his or her lifetime
with any excess of the purchase price over the remaining payments due payable
in a lump sum to his or her beneficiary upon the Transferred Employee’s death.
Notwithstanding anything herein to the contrary, if the Transferred Employee
elects a life annuity form as provided hereunder as the method of distribution
and is married at the Annuity Starting Date, such Transferred Employee’s
distributions shall be paid in the form of a Qualified Joint and Survivor
Annuity as described in paragraph (2)(a) above, unless the Transferred
Employee elects otherwise pursuant to the provisions of paragraph (2)(c)
above.”

 

10.           A
new paragraph (16) is hereby added to Section 13.5 under
Paragraph 6(g) of Appendix A, to read as follows:

 

“(16)       Except as otherwise provided in §7.1(1),
§7.2(3) and §7.3(d), the methods of distribution available with respect to the
Rollover Contribution Account of any Transferred Employee who was a former
participant in the CMSI Plan shall include the methods of distribution set
forth in paragraphs (7)(a) and (7)(b) of this §13.5.”

 

11.           A
new paragraph (17) is hereby added to Section 13.5 under
Paragraph 6(g) of Appendix A, to read as follows:

 

“(17)       Except as otherwise provided in §7.1(1),
§7.2(3) and §7.3(d), the methods of distribution available with respect to the
Rollover Contribution Account of any Transferred Employee who was a former
participant in the Platinum Plan shall include the methods of distribution set
forth in paragraphs (6)(a)(ii) and (iii) of this §13.5.”

 

12.           The
preceding Items of this Amendment shall be effective as follows: Items 1,
2 and 6 shall be effective March 31, 1997. 
Item 3 shall be effective prior to January 1, 1999.  The references in Item 4 to Realogic,
Inc., Viewpoint Datalabs, Inc., LDA Systems, Inc., Distribution Software, Inc.,
Computer Management Sciences, Inc., and PLATINUM technology international, inc.
(formerly known as PLATINUM

 

4

 

technology, inc.) shall
be effective October 1, 1998, November 1, 1998, December 1,
1998, March 1, 1999, May 1, 1999, and July 1, 1999,
respectively; the references in Item 5 to the Realogic, Viewpoint, LDA,
CMSI and Platinum Plans shall be effective October 1, 1998,
November 1, 1998, December 1, 1998, May 1, 1999, and
July 1, 1999, respectively; Item 7 shall be effective
December 1, 1998; Item 8 shall be effective January 29,1999;
Item 9 shall be effective April 28, 1999; Item 10 shall be
effective August 1, 1999; and Item 11 shall be effective
October 1, 1999.

 

IN WITNESS WHEREOF, the Committee of the Computer
Associates Savings Harvest Plan has caused this Amendment to be signed by a
member thereof this 7th day of June, 2004.

 

 

5

 

FIFTH AMENDMENT

TO THE

COMPUTER ASSOCIATES SAVINGS HARVEST PLAN

(as amended and restated effective March 31, 1997 and adopted May 22,
2001)

 

WHEREAS,
Computer Associates International, Inc. (the “Employer”) established and
presently maintains the Computer Associates Savings Harvest Plan (the “Plan”)
for its eligible employees;

 

WHEREAS,
the Plan, as most recently amended and restated, was submitted to the Internal
Revenue Service (“Service”) in order to obtain a determination from the Service
that the Plan continues to be qualified under Sections 401(a) and 401(k)
of the Internal Revenue Code of 1986, as amended (the “Code”), and that the
Trust created thereunder continues to be tax-exempt under Section 501(a)
of the Code;

 

WHEREAS,
the Service has requested that certain technical amendments be made to the Plan
in connection with the issuance of such a determination letter;

 

WHEREAS,
pursuant to Plan Section 10.2(d), the Committee of the Plan has the power
to amend the Plan with respect to such technical amendments;

 

NOW
THEREFORE, the Plan is hereby amended in the following respects:

 

1.             The first sentence of
subparagraph (i) of Section 3.2(b) is hereby amended to read in its
entirety as follows:

 

“(i)          With
respect to Employer Matching Contributions, Employer Discretionary
Contributions, and Voluntary Contributions, an Employee shall become a
Participant on the first day of the calendar month following the first day
after the date on which he completes the eligibility requirements set forth in
Section 3.l(b)(ii); provided, however, that the Employee must be actively
employed by the Employer on such date in order to become a Participant on such
date.”

 

 

2.             Section 4.10(a)(iv)(C) is hereby
amended to read in its entirety as follows:

 

“(C)         For
purposes of this paragraph (iv), “Excess Pre-Tax Contributions” means,
with respect to a Plan Year, the excess of (1) the aggregate amount of Pre-Tax
Contributions actually taken into account in computing the Actual Deferral
Percentages of Highly Compensated Employees for such Plan Year, over (2) the
maximum amount of such Contributions permitted by the non-discrimination test
set forth under Section 4.10(a)(i) (determined by hypothetically reducing
contributions made on behalf of Highly Compensated Employees in order of the
Actual Deferral Percentages, beginning with the highest of such percentages).”

 

3.             Section 4.10(b)(iii)(C) is
hereby amended to read in its entirety as follows:

 

“(C)         For
purposes of this paragraph (iii), “Excess Aggregate Contributions” means,
with respect to a Plan Year, the excess of (1) the aggregate amount of
Employer Matching and Voluntary Contributions actually taken into account in
computing the Actual Contribution Percentages of Highly Compensated Employees
for such Plan Year, over (2) the maximum amount of such Contributions
permitted by the non-discrimination test set forth under
Section 4.10(b)(i) (determined by hypothetically reducing contributions
made on behalf of Highly Compensated Employees in order of the Actual
Contribution Percentages, beginning with the highest of such percentages).”

 

4.             Paragraph (iii) of Section
4.11(c) is hereby amended to read in its entirety as follows:

 

“(iv)        Limitation
Year Compensation means compensation within the meaning of Treasury
Regulation Section 1.415-2(d)(11)(i) for the Limitation Year; provided,
however, that for Limitation Years commencing after December 31, 1997,
such

 

2

 

compensation shall include any amounts which are
contributed or deferred at the election of the Participant and are not
includible in gross income by reason of Section 125 or 457 of the Code,
and further provided that for Limitation Years commencing after December 31,
2000, such compensation shall include any amounts which are contributed or
deferred at the election of the Participant and are not includible in gross
income by reason of Section 132(f)(4) of the Code.”

 

5.             Except as otherwise provided in
this Amendment, the provisions of this amendment shall be effective
March 31, 1997.

 

IN
WITNESS WHEREOF, the Committee of the Computer Associates Savings Harvest Plan
has caused this Amendment to be signed by a member thereof this 7th day of
June, 2004.

 

 

3

 

SIXTH AMENDMENT

TO THE

COMPUTER ASSOCIATES SAVINGS HARVEST PLAN

 

(As Amended and Restated
Effective March 31, 1997 and adopted May 22, 2001)

 

WHEREAS,
Computer Associates International, Inc. (the “Employer”) established and
presently maintains the Computer Associates Savings Harvest Plan (the “Plan”)
for its eligible employees;

 

WHEREAS,
the Employer desires to amend the Plan to delete a provision that precludes the
distribution of a participant’s vested account until such participant’s normal
retirement age based on his or her actions;

 

WHEREAS,
the Employer also desires to amend the Plan to provide that the Compensation
and Human Resource Committee will replace the Corporate Operations Committee as
administrator under the Plan; and

 

WHEREAS,
pursuant to Section 10.2(d) of the Plan, the Employer is empowered to amend the
Plan, in whole or in part;

 

NOW
THEREFORE, the Plan is hereby amended in the following
respects:

 

1.             Paragraph (b) of Section 7.3 is hereby deleted in its
entirety.

 

2.             All references in the Plan to the Executive Committee or
the Corporate Operations Committee are hereby amended to refer to the
Compensation and Human Resource Committee of the Board (or any successor to
such Compensation and Human Resource Committee).

 

3.             This Amendment shall be effective as of January 1, 2005.

 

IN
WITNESS WHEREOF, Computer Associates International, Inc., as
authorized by the Corporate Operations Committee of its Board of Directors, has
caused this Amendment to be signed by its proper officer this         
day of                 ,
2005.

 

 

SEVENTH
AMENDMENT

 

TO THE

 

COMPUTER
ASSOCIATES SAVINGS HARVEST PLAN

 

(As Amended and
Restated Effective March 31, 1997)

 

THIS AMENDMENT to the Computer Associates Savings
Harvest Plan (“Plan”) is hereby made and entered
into by the Plan Committee (“Committee”).

 

W I T N E S S E T
H:

 

WHEREAS, Computer Associates International, Inc.
sponsors and maintains the Plan for the benefit of the Plan’s participants and
beneficiaries;

 

WHEREAS,
the Plan reserves to the Committee the right to amend or modify the Plan from
time to time; and

 

WHEREAS,
the Committee desires to amend the Plan’s small account cash-out limit from
$5,000 to $1,000, effective as of March 28, 2005.

 

NOW, THEREFORE, the Plan is amended as follows:

 

1.

 

Effective as of March 28, 2005, Section
7.2(b) is amended by deleting its reference to “$5,000” and
substituting “$1,000” therefor.

 

2.

 

Effective as of March 28, 2005, Section 7.6 is
amended by deleting its reference to “$5,000” and substituting “$1,000”
therefor.

 

3.

 

Effective as of March 28,
2005, Section 9.1(b) is amended by deleting
its reference to “$5,000” and substituting “$1,000” therefor.

 

4.

 

Effective as of March 28,
2005, Section 13.5(b)(iv)  is amended by deleting its
reference to “$5,000” and substituting “$1,000” therefor.

 

 

5.

 

Effective as of March 28,
2005, Section 13.5(c)(i) is amended by
deleting its reference to “$5,000” and substituting “$1,000” therefor.

 

6.

 

Except as amended herein, the provisions of the Plan
shall remain in full force and effect.

 

IN WITNESS WHEREOF, the Committee has caused this
Amendment to be executed this        day of                   ,
2005.

 

2Exhibit 4.7

 

NIKU
CORPORATION

2000 STOCK
INCENTIVE PLAN

Adopted August 9,
2000

As Amended August 13, 2001

 

1.                                      PURPOSE.  The purpose of this Plan is to provide
incentives to attract, retain, compensate and motivate employees, directors and
consultants of Niku Corporation, a Delaware corporation (the “Company”) and its
Subsidiaries, including those connected with the Company’s acquisitions of ABT
Corporation, bSource.com, Inc. and 600 Monkeys, Inc., by offering
them an opportunity to participate in the Company’s future performance through
awards of Options, Restricted Stock and Stock Bonuses.  Capitalized terms not defined in the text are
defined in Section 22 if they are not otherwise defined in other sections
of this Plan.

 

2.                                      SHARES SUBJECT TO THE PLAN.

 

2.1                                 Number of Shares Available.  Subject to Sections 2.2 and 17, the total
number of Shares reserved and available for grant and issuance pursuant to this
Plan will be 2,600,000 Shares.  Subject
to Sections 2.2 and 17, Shares that are subject to: (a) issuance upon
exercise of an Option but cease to be subject to such Option for any reason
other than exercise of such Award and (b) an Award granted hereunder but
are forfeited or are repurchased by the Company at the original issue price
because the Shares are Unvested Shares at the time of the Participant’s
Termination, will again be available for grant and issuance in connection with
future Awards under this Plan.  At all
times the Company shall reserve and keep available a sufficient number of
Shares as shall be required to satisfy the requirements of all outstanding
Awards granted under this Plan.

 

2.2                                 Adjustment of Shares.  If the number of outstanding shares is
changed by a stock dividend, recapitalization, stock split, reverse stock
split, subdivision, combination, reclassification or similar change in the
capital structure of the Company without consideration, then (a) the
number of Shares reserved for issuance under this Plan, (b) the Exercise
Prices of and number of Shares subject to outstanding Options, and (c) the
number of Shares subject to other outstanding Awards, will be proportionately
adjusted, subject to any required action by the Board or the stockholders of
the Company and compliance with applicable securities laws; provided,
that fractions of a Share will not be issued but will either be paid in cash at
the Fair Market Value of such fraction of a Share or will be rounded up to the
nearest whole Share, as determined by the Committee; and provided, further,
that the Exercise Price of any Award may not be decreased to below the par
value of the Shares.

 

3.                                      ELIGIBILITY.  Awards may be granted to employees, officers,
directors, consultants, independent contractors and advisors of the Company or
any Parent or Subsidiary of the Company; provided such consultants,
independent contractors and advisors render bona fide services not in
connection with the offer and sale of securities in a capital-raising
transaction.  A person may be granted
more than one Award under this Plan. 
Awards granted to officers and non-employee directors may not exceed in
the aggregate forty percent (40%) of all Shares that are reserved for grant
under this Plan.  Awards granted as
Restricted Stock to officers and non-employee directors may not exceed in the
aggregate forty percent (40%) of all Shares that are granted as Restricted
Stock.

 

4.                                      ADMINISTRATION.

 

4.1                                 Committee Authority.  This Plan will be administered by the
Committee or by the Board acting as the Committee.  Subject to the general purposes, terms and
conditions of this Plan, and to the direction of the Board, the Committee will
have full power to implement and carry out this Plan.  Without limitation, the Committee will have
the authority to:

 

(a)                                  construe and
interpret this Plan, any Award Agreement and any other agreement or document
executed pursuant to this Plan;

 

(b)                                 prescribe, amend and
rescind rules and regulations relating to this Plan or any Award;

 

 

(c)                                  select persons to
receive Awards;

 

(d)                                 determine the form and
terms of Awards;

 

(e)                                  determine the number of
Shares subject to Awards;

 

(f)                                    determine whether
Awards will be granted singly, in combination with, in tandem with, in
replacement of, or as alternatives to, other Awards under this Plan or any
other incentive or compensation plan of the Company or any Parent or Subsidiary
of the Company;

 

(g)                                 grant waivers of Plan
or Award conditions;

 

(h)                                 determine the vesting,
exercisability and payment of Awards;

 

(i)                                     correct any
defect, supply any omission or reconcile any inconsistency in this Plan, any
Award or any Award Agreement;

 

(j)                                     determine whether
an Award has been earned; and

 

(k)                                  make all other
determinations necessary or advisable for the administration of this Plan.

 

4.2                                 Committee Discretion.  Any determination made by the Committee with
respect to any Award will be made in its sole discretion at the time of grant
of the Award or, unless in contravention of any express term of this Plan or
Award, at any later time, and such determination will be final and binding on
the Company and on all persons having an interest in any Award under this
Plan.  The Committee may delegate to one
or more officers of the Company the authority to grant an Award under this Plan
to Participants who are not officers.

 

5.                                      OPTIONS.  Only nonqualified stock options that do not
qualify as incentive stock options within the meaning of Section 422(b) of
the Code may be granted under this Plan. 
The Committee may grant Options to eligible persons and will determine (i) the
number of Shares subject to the Option, (ii) the Exercise Price of the
Option, (iii) the period during which the Option may be exercised, and (iv) all
other terms and conditions of the Option, subject to the following:

 

5.1                                 Form of Option Grant.  Each Option granted under this Plan will be
evidenced by a Stock Option Agreement. 
The Stock Option Agreement will be in such form and contain such
provisions (which need not be the same for each Participant) as the Committee
may from time to time approve, and which will comply with and be subject to the
terms and conditions of this Plan.

 

5.2                                 Date of Grant.  The date of grant of an Option will be the
date on which the Committee makes the determination to grant the Option, unless
a later date is otherwise specified by the Committee.  The Stock Option Agreement and a copy of this
Plan will be delivered to the Participant within a reasonable time after the
Option is granted.

 

5.3                                 Exercise Period
and Expiration Date.  Options will be
exercisable within the times or upon the occurrence of events determined by the
Committee as set forth in the Stock Option Agreement governing such Option; provided,
however, that no Option will be exercisable after the expiration of ten (10) years
from the date the Option is granted.  The
Committee also may provide for Options to become exercisable at one time or
from time to time, periodically or otherwise, in such number of Shares or
percentage of Shares as the Committee determines.

 

5.4                                 Exercise Price.  The Exercise Price of an Option will be
determined by the Committee when the Option is granted and may be not less than
the par value of the Shares on the date of grant.  Payment for the Shares purchased must be made
in accordance with Section 7 of this Plan.

 

 

5.5                                 Method of Exercise.  Options may be exercised only by delivery to
the Company of a written stock option exercise agreement  (the “Exercise Agreement”)
in a form approved by the Committee (which need not be the same for each
Participant), stating the number of Shares being purchased, the restrictions
imposed on the Shares purchased under such Exercise Agreement, if any, and such
representations and agreements regarding Participant’s investment intent and
access to information and other matters, if any, as may be required or
desirable by the Company to comply with applicable securities laws, together
with payment in full of the Exercise Price for the number of Shares being
purchased.

 

5.6                                 Termination.  Notwithstanding the exercise periods set
forth in the Stock Option Agreement, exercise of an Option will always be
subject to the following:

 

(a)                                  If the Participant is
Terminated for any reason except death or Disability, then the Participant may
exercise such Participant’s Options only to the extent that such Options would
have been exercisable upon the Termination Date no later than three (3) months
after the Termination Date (or such shorter or longer time period not exceeding
five (5) years as may be determined by the Committee, but in any event, no
later than the expiration date of the Options.

 

(b)                                 If the Participant is
Terminated because of Participant’s death or Disability (or the Participant
dies within three (3) months after a Termination other than for Cause or
because of Participant’s Disability), then Participant’s Options may be
exercised only to the extent that such Options would have been exercisable by
Participant on the Termination Date and must be exercised by Participant (or
Participant’s legal representative or authorized assignee) no later than twelve
(12) months after the Termination Date (or such shorter or longer time period
not exceeding five (5) years as may be determined by the Committee) but in
any event no later than the expiration date of the Options.

 

(c)                                  Notwithstanding the
provisions in paragraph 5.6(a) above, if a Participant is terminated for
Cause, neither the Participant, the Participant’s estate nor such other person
who may then hold the Option shall be entitled to exercise any Option with
respect to any Shares whatsoever, after termination of service, whether or not
after termination of service the Participant may receive payment from the
Company or any Parent or Subsidiary of the Company for vacation pay, for
services rendered prior to termination, for services rendered for the day on
which termination occurs, for salary in lieu of notice, or for any other benefits.  In making such determination, the Board shall
give the Participant an opportunity to present to the Board evidence on his
behalf.  For the purpose of this
paragraph, termination of service shall be deemed to occur on the date when the
Company dispatches notice or advice to the Participant that his service is
terminated.

 

5.7                                 Limitations on Exercise.  The Committee may specify a reasonable
minimum number of Shares that may be purchased on any exercise of an Option,
provided that the minimum number will not prevent a Participant from exercising
the Option for the full number of Shares for which it is then exercisable.

 

5.8                                 Modification, Extension or Renewal.  The Committee may modify, extend or renew
outstanding Options and authorize the grant of new Options in substitution
therefor, provided that any such action may not, without the written consent of
a Participant, impair any of such Participant’s rights under any Option
previously granted.  The Committee may
reduce the Exercise Price of outstanding Options without the consent of
Participants affected by a written notice to them; provided, however,
that the Exercise Price may not be reduced below the minimum Exercise Price
that would be permitted under Section 5.4 of this Plan for Options granted
on the date the action is taken to reduce the Exercise Price; and provided,
further, that the Exercise Price shall not be reduced below the par value of
the Shares.

 

6.                                      RESTRICTED STOCK
AND STOCK BONUSES.

 

6.1                                 Restricted Stock Award.  A Restricted Stock Award is an offer by the
Company to sell to an eligible person Shares that are subject to
restrictions.  The Committee will
determine to whom an offer will be made, the number of Shares the person may
purchase, the price to be paid (the “Purchase Price”),
the restrictions to which the Shares will be subject, and all other terms and
conditions of the Restricted Stock Award, subject to this

 

 

section of the Plan.  All
purchases under a Restricted Stock Award made pursuant to this Plan will be
evidenced by an Award Agreement (“Restricted
Stock Purchase Agreement”) that will be in such form
(which need not be the same for each Participant) as the Committee will from
time to time approve, and will comply with and be subject to the terms and
conditions of this Plan.  The offer of
Restricted Stock will be accepted by the Participant’s execution and delivery
of the Restricted Stock Purchase Agreement and full payment for the Shares to
the Company within thirty (30) days from the date the Restricted Stock Purchase
Agreement is delivered to the person.  If
such person does not execute and deliver the Restricted Stock Purchase
Agreement along with full payment for the Shares to the Company within thirty
(30) days, then the offer will terminate, unless otherwise determined by the
Committee.

 

6.2                                 Purchase Price.  The Purchase Price of Shares sold pursuant to
a Restricted Stock Award will be determined by the Committee on the date the
Restricted Stock Award is granted and may be not less than the par value of the
Shares on the date of grant.  Payment of
the Purchase Price may be made in accordance with Section 7 of this Plan.

 

6.3                                 Terms of Restricted
Stock Awards.  Restricted Stock Awards shall be subject to
such restrictions as the Committee may impose. 
These restrictions may be based upon completion of a specified number of
years of service with the Company or upon completion of the performance goals
as set out in advance in the Participant’s individual Restricted Stock Purchase
Agreement.  Restricted Stock Awards may
vary from Participant to Participant and between groups of Participants. Prior
to the grant of a Restricted Stock Award, the Committee shall: (a) determine
the nature, length and starting date of any Performance Period for the
Restricted Stock Award; (b) select from among the Performance Factors to
be used to measure performance goals, if any; and (c) determine the number
of Shares that may be awarded to the Participant.  Prior to the payment of any Restricted Stock
Award, the Committee shall determine the extent to which such Restricted Stock
Award has been earned. Performance Periods may overlap and Participants may
participate simultaneously with respect to Restricted Stock Awards that are
subject to different Performance Periods and having different performance goals
and other criteria.

 

6.4                                 Termination During Performance Period.  If a Participant is Terminated during a
performance period for any reason, then such Participant will be entitled to
payment (whether in Shares, cash or otherwise) with respect to the Restricted
Stock Award only to the extent earned as of the date of Termination in
accordance with the Restricted Stock Purchase Agreement, unless the Committee
will determine otherwise.

 

6.5                                  Awards of Stock Bonuses. A Stock Bonus is an award of Shares (which
may consist of Restricted Stock) for services rendered to the Company or any
Parent or Subsidiary of the Company.  A
Stock Bonus may be awarded for past services already rendered to the Company,
or any Parent or Subsidiary of the Company pursuant to an Award Agreement (the “Stock Bonus Agreement”)
that will be in such form (which need not be the same for each Participant) as
the Committee will from time to time approve, and will comply with and be
subject to the terms and conditions of this Plan. A Stock Bonus may be awarded
upon satisfaction of such performance goals as are set out in advance in the
Participant’s individual Award Agreement (the “Performance Stock Bonus
Agreement”) that will be in such form (which need not be the same for each
Participant) as the Committee will from time to time approve, and will comply
with and be subject to the terms and conditions of this Plan. Stock Bonuses may
vary from Participant to Participant and between groups of Participants, and
may be based upon the achievement of the Company, Parent or Subsidiary and/or
individual performance factors or upon such other criteria as the Committee may
determine.

 

6.6                                  Terms of Stock Bonuses. The Committee will determine the number of
Shares to be awarded to the Participant. If the Stock Bonus is being earned
upon the satisfaction of performance goals pursuant to a Performance Stock
Bonus Agreement, then the Committee will: (a) determine the nature, length
and starting date of any Performance Period for each Stock Bonus; (b) select
from among the Performance Factors to be used to measure the performance, if
any; and (c) determine the number of Shares that may be awarded to the
Participant. Prior to the payment of any Stock Bonus, the Committee shall
determine the extent to which such Stock Bonuses have been earned. Performance
Periods may overlap and Participants may participate simultaneously with
respect to Stock Bonuses that are subject to different Performance Periods and
different performance goals and other criteria. The number of Shares may be
fixed or may vary in accordance with such performance goals and criteria as may
be determined by the Committee. The Committee may adjust the performance goals
applicable to the Stock Bonuses to

 

 

take
into account changes in law and accounting or tax rules and to make such
adjustments as the Committee deems necessary or appropriate to reflect the
impact of extraordinary or unusual items, events or circumstances to avoid
windfalls or hardships.

 

6.7                                 Form of Payment. The earned portion of a Stock Bonus may be
paid currently or on a deferred basis with such interest or dividend
equivalent, if any, as the Committee may determine. Payment may be made in the
form of cash or whole Shares or a combination thereof, either in a lump sum
payment or in installments, all as the Committee will determine.

 

7.                                       PAYMENT FOR SHARE PURCHASES.

 

7.1                                 Payment.  Payment for Shares purchased on exercise of
an Award may be made in cash (by check) or, where expressly approved for the
Participant by the Committee and where permitted by law:

 

(a)                                  by cancellation of
indebtedness of the Company to the Participant;

 

(b)                                 by surrender of shares
that either:  (1) have been owned by
Participant for more than six (6) months and have been paid for within the
meaning of SEC Rule 144 (and, if such shares were purchased from the
Company by use of a promissory note, such note has been fully paid with respect
to such shares); or (2) were obtained by Participant in the public market;

 

(c)                                  by tender of a full
recourse promissory note having such terms as may be approved by the Committee
and bearing interest at a rate sufficient to avoid imputation of income under
Sections 483 and 1274 of the Code; provided, however, that a
Participant who is not an employee of the Company may not purchase Shares with
a promissory note unless the note is adequately secured by collateral other
than the Shares; and provided, further, that the portion of the Exercise Price
equal to the par value of the Shares must be paid in cash;

 

(d)                                 by waiver of
compensation due or accrued to the Participant for services rendered;

 

(e)                                  provided that a
public market for the Company’s stock exists:

 

(1)                                  through a “same day
sale” commitment from the Participant and a broker-dealer that is a member of
the National Association of Securities Dealers (an “NASD Dealer”)
whereby the Participant irrevocably elects to exercise the Option and to sell a
portion of the Shares so purchased to pay for the Exercise Price, and whereby
the NASD Dealer irrevocably commits upon receipt of such Shares to forward the
Exercise Price directly to the Company; or

 

(2)                                  through a “margin”
commitment from the Participant and a NASD Dealer whereby the Participant
irrevocably elects to exercise the Option and to pledge the Shares so purchased
to the NASD Dealer in a margin account as security for a loan from the NASD
Dealer in the amount of the Exercise Price, and whereby the NASD Dealer
irrevocably commits upon receipt of such Shares to forward the Exercise Price
directly to the Company; or

 

(f)                                    by any combination
of the foregoing.

 

7.2                                 Loan Guarantees.  The Committee may help the Participant pay
for Shares purchased under this Plan by authorizing a guarantee by the Company
of a third-party loan to the Participant.

 

8.                                      WITHHOLDING TAXES.

 

8.1                                 Withholding Generally.  Whenever Shares are to be issued on exercise
of Awards granted under this Plan, the Company may require the Participant to
remit to the Company an amount sufficient to satisfy federal, state and local
withholding tax requirements prior to the delivery of any certificate or
certificates for such

 

 

Shares.  If a payment in
satisfaction of an Award is to be made in cash, such payment will be net of an
amount sufficient to satisfy federal, state, and local withholding tax
requirements.

 

8.2                                 Stock Withholding.  When, under applicable tax laws, a
Participant incurs tax liability in connection with the exercise or vesting of
any Award that is subject to tax withholding and the Participant is obligated
to pay the Company the amount required to be withheld, the Committee may in its
sole discretion allow the Participant to satisfy the minimum withholding tax
obligation by electing to have the Company withhold from the Shares to be
issued that number of Shares having a Fair Market Value equal to the minimum
amount required to be withheld, determined on the date that the amount of tax
to be withheld is to be determined.  All
elections by a Participant to have Shares withheld for this purpose will be
made in accordance with the requirements established by the Committee and be in
writing in a form acceptable to the Committee

 

9.                                      PRIVILEGES OF STOCK OWNERSHIP.

 

9.1                                 Voting and Dividends.  No Participant will have any of the rights of
a stockholder with respect to any Shares until the Shares are issued to the
Participant.  After Shares are issued to
the Participant, the Participant will be a stockholder and have all the rights
of a stockholder with respect to such Shares, including the right to vote and
receive all dividends or other distributions made or paid with respect to such
Shares; provided, however, that if such Shares are Restricted Stock, any new,
additional or different securities the Participant may become entitled to
receive with respect to the Shares by virtue of a stock dividend, stock split
or any other change in the corporate or capital structure of the Company will
be subject to the same restrictions as the Restricted Stock; provided, further
that the Participant will have no right to retain such dividends or
distributions with respect to Shares that are repurchased at the Participant’s
original Exercise Price pursuant to Section 11.

 

9.2                                 Financial Statements.  The Company will provide financial statements
to each Participant prior to such Participant’s purchase of Shares under this
Plan, and to each Participant annually during the period such Participant has
Awards outstanding; provided, however, that the Company will not
be required to provide such financial statements to Participants whose services
in connection with the Company assure them access to equivalent information.

 

10.                               TRANSFERABILITY.

 

10.1                           Except as otherwise provided
in this Section 10, Awards granted under this Plan, and any interest
therein, will not be transferable or assignable by Participant, and may not be
made subject to execution, attachment or similar process, otherwise than by
will or by the laws of descent and distribution or as determined by the
Committee and set forth in the Award Agreement.

 

10.2                           Unless otherwise restricted
by the Committee, an Option shall be exercisable: (i) during the
Participant’s lifetime only by (A) the Participant, (B) the
Participant’s guardian or legal representative, (C) a Family Member of the
Participant who has acquired the Option by “permitted transfer;” and (ii) after
Participant’s death, by the legal representative of the Participant’s heirs or
legatees.  “Permitted transfer” means, as
authorized by this Plan and the Committee in an Option, any transfer effected
by the Participant during the Participant’s lifetime of an interest in such
Option but only such transfers which are by gift or domestic relations
order.  A permitted transfer does not
include any transfer for value and neither of the following are transfers for
value:  (a) a transfer of under a
domestic relations order in settlement of marital property rights or (b) a
transfer to an entity in which more than fifty percent of the voting interests
are owned by Family Members or the Participant in exchange for an interest in
that entity.

 

10.3                           Unless otherwise restricted
by the Committee, a Restricted Stock may be transferred during the Participant’s
lifetime, only to (A) the Participant, or (B) the Participant’s
guardian or legal representative.

 

11.                               RESTRICTIONS ON SHARES.  At the discretion of the Committee, the
Company may reserve to itself and/or its assignee(s) in the Award Agreement a
right to repurchase at the Participant’s Exercise Price a portion of or all
Unvested Shares held by a Participant following such Participant’s Termination
at any time within ninety (90) days after the later of Participant’s
Termination Date and the date Participant purchases Shares under this

 

 

Plan, for cash and/or cancellation of purchase money indebtedness, at
the Participant’s Exercise Price or Purchase Price, as the case may be.

 

12.                               CERTIFICATES.  All certificates for Shares or other
securities delivered under this Plan will be subject to such stock transfer
orders, legends and other restrictions as the Committee may deem necessary or
advisable, including restrictions under any applicable federal, state or foreign
securities law, or any rules, regulations and other requirements of the SEC or
any stock exchange or automated quotation system upon which the Shares may be
listed or quoted.

 

13.                               ESCROW; PLEDGE OF SHARES.  To enforce any restrictions on a Participant’s
Shares, the Committee may require the Participant to deposit all certificates
representing the Shares, together with stock powers or other instruments of
transfer approved by the Committee, appropriately endorsed in blank, with the
Company or an agent designated by the Company to hold in escrow until such
restrictions have lapsed or terminated, and the Committee may cause a legend or
legends referencing such restrictions to be placed on the certificates.  Any Participant who is permitted to execute a
promissory note as partial or full consideration for the purchase of Shares
under this Plan will be required to pledge and deposit with the Company all or
part of the Shares so purchased as collateral to secure the payment of
Participant’s obligation to the Company under the promissory note; provided,
however, that the Committee may require or accept other or additional
forms of collateral to secure the payment of such obligation and, in any event,
the Company will have full recourse against the Participant under the
promissory note notwithstanding any pledge of the Participant’s Shares or other
collateral.  In connection with any
pledge of the Shares, Participant will be required to execute and deliver a
written pledge agreement in such form as the Committee will from time to time
approve.  The Shares purchased with the
promissory note may be released from the pledge on a pro rata basis as the
promissory note is paid.

 

14.                               EXCHANGE AND BUYOUT OF AWARDS.  The Committee may, at any time or from time
to time, authorize the Company, with the consent of the respective
Participants, to issue new Awards in exchange for the surrender and
cancellation of any or all outstanding Awards. 
The Committee may at any time buy from a Participant an Award previously
granted with payment in cash, Shares (including Restricted Stock) or other
consideration, based on such terms and conditions as the Committee and the
Participant may agree.

 

15.                               SECURITIES LAW AND OTHER REGULATORY COMPLIANCE.  An Award will not be effective unless such
Award is in compliance with all applicable federal and state securities laws, rules and
regulations of any governmental body, and the requirements of any stock
exchange or automated quotation system upon which the Shares may then be listed
or quoted, as they are in effect on the date of grant of the Award and also on
the date of exercise or other issuance. 
Notwithstanding any other provision in this Plan, the Company will have
no obligation to issue or deliver certificates for Shares under this Plan prior
to:  (a) obtaining any approvals
from governmental agencies that the Company determines are necessary or
advisable; and/or (b) completion of any registration or other
qualification of such Shares under any state or federal law or ruling of any
governmental body that the Company determines to be necessary or
advisable.  The Company will be under no
obligation to register the Shares with the SEC or to effect compliance with the
registration, qualification or listing requirements of any state securities laws,
stock exchange or automated quotation system, and the Company will have no
liability for any inability or failure to do so.

 

16.                               NO OBLIGATION TO EMPLOY.  Nothing in this Plan or any Award granted
under this Plan will confer or be deemed to confer on any Participant any right
to continue in the employ of, or to continue any other relationship with, the
Company or any Parent or Subsidiary of the Company or limit in any way the
right of the Company or any Parent or Subsidiary of the Company to terminate Participant’s
employment or other relationship at any time, with or without cause.

 

17.                               CORPORATE TRANSACTIONS.

 

17.1                           Assumption or Replacement of Awards
by Successor.  In the event of (a) a
dissolution or liquidation of the Company, (b) a merger or consolidation
in which the Company is not the surviving corporation (other than a merger or
consolidation with a wholly-owned subsidiary, a reincorporation of the Company
in a

 

 

different jurisdiction, or other transaction in which there is no
substantial change in the stockholders of the Company or their relative stock
holdings and the Awards granted under this Plan are assumed, converted or
replaced by the successor corporation, which assumption will be binding on all
Participants), (c) a merger in which the Company is the surviving
corporation but after which the stockholders of the Company immediately prior
to such merger (other than any stockholder that merges, or which owns or
controls another corporation that merges, with the Company in such merger) cease
to own their shares or other equity interest in the Company, (d) the sale
of substantially all of the assets of the Company, or (e) the acquisition,
sale, or transfer of more than 50% of the outstanding shares of the Company by
tender offer or similar transaction (each, a “Corporate Transaction”), (i) the
vesting of all outstanding Awards will accelerate as to an additional 25% of
the Shares that are unvested on the date of the Corporate Transaction and, (ii) thereafter,
unless otherwise set forth below, all unvested shares subject to outstanding
Awards will continue to vest in equal monthly installments over the remaining
original vesting term as set forth in the Award Agreement.  Upon a Corporate Transaction, all outstanding
Awards shall be assumed by the successor or acquiring corporation (if any),
which assumption will be binding on all Participants.  In the alternative, the successor or
acquiring corporation may substitute equivalent Awards or provide substantially
similar consideration to Participants as was provided to shareholders (after
taking into account the existing provisions of the Awards).  The successor corporation may also issue, in
place of outstanding unvested Shares of the Company held by the Participants,
substantially similar shares or other property subject to repurchase
restrictions no less favorable to the Participant.  In the event such successor corporation (if
any) refuses to assume or substitute Awards, as provided above, pursuant to a
Corporate Transaction described in this Subsection 17.1, such Awards will
expire on such Corporate Transaction at such time and on such conditions as the
Committee will determine. 
Notwithstanding anything in this Plan to the contrary, the Committee
may, in its sole discretion, provide that the vesting of any or all Awards
granted pursuant to this Plan will accelerate upon a Corporate Transaction
described in this Section 17.  If
the Committee exercises such discretion with respect to Options, such Options
will become exercisable in full prior to the consummation of such event at such
time and on such conditions as the Committee determines, and if such Options
are not exercised prior to the consummation of the Corporate Transaction, they
shall terminate at such time as determined by the Committee.

 

17.2                           Other Treatment of Awards.  Subject to any greater rights granted to
Participants under the foregoing provisions of this Section 17, in the
event of the occurrence of any Corporate Transaction described in Section 17.1,
any outstanding Awards will be treated as provided in the applicable agreement
or plan of merger, consolidation, dissolution, liquidation, or sale of assets.

 

17.3                           Assumption of Awards by the Company.  The Company, from time to time, also may
substitute or assume outstanding awards granted by another company, whether in
connection with an acquisition of such other company or otherwise, by either; (a) granting
an Award under this Plan in substitution of such other company’s award; or (b) assuming
such award as if it had been granted under this Plan if the terms of such
assumed award could be applied to an Award granted under this Plan.  Such substitution or assumption will be
permissible if the holder of the substituted or assumed award would have been
eligible to be granted an Award under this Plan if the other company had
applied the rules of this Plan to such grant.  In the event the Company assumes an award
granted by another company, the terms and conditions of such award will remain
unchanged (except that the exercise price and the number and nature of
Shares issuable upon exercise of any such option will be adjusted appropriately
pursuant to Section 424(a) of the Code).  In the event the Company elects to grant a
new Option rather than assuming an existing option, such new Option may be granted
with a similarly adjusted Exercise Price.

 

18.                               ADOPTION.  This Plan will become effective on the date
that it is adopted by the Board (the “Effective Date”).

 

19.                               TERM OF PLAN/GOVERNING
LAW.  Unless earlier terminated
as provided herein, this Plan will terminate ten (10) years from the
Effective Date.  This Plan and all
agreements thereunder shall be governed by and construed in accordance with the
laws of the State of California.

 

20.                               AMENDMENT OR TERMINATION OF PLAN.  The Board may at any time terminate or amend
this Plan in any respect, including without limitation amendment of any form of
Award Agreement or instrument to be executed pursuant to this Plan.

 

 

21.                               NONEXCLUSIVITY OF THE PLAN.  Neither the adoption of this Plan by the
Board, nor any provision of this Plan will be construed as creating any
limitations on the power of the Board to adopt such additional compensation
arrangements as it may deem desirable, including, without limitation, the
granting of stock option and bonuses otherwise than under this Plan, and such
arrangements may be either generally applicable or applicable only in specific
cases.

 

22.                               DEFINITIONS.  As used in this Plan, the following terms
will have the following meanings:

 

“Award”
means any award under this Plan, including any Option or Restricted Stock.

 

“Award Agreement”
means, with respect to each Award, the signed written agreement between the
Company and the Participant setting forth the terms and conditions of the
Award.

 

“Board”
means the Board of Directors of the Company.

 

“Cause”
means the commission of an act of theft, embezzlement, fraud, dishonesty or a
breach of fiduciary duty to the Company or a Parent or Subsidiary of the
Company.

 

“Code” means
the Internal Revenue Code of 1986, as amended.

 

“Committee”
means the Compensation Committee of the Board.

 

“Company”
means NIKU Corporation or any successor corporation.

 

“Disability”
means a disability, whether temporary or permanent, partial or total, as
determined by the Committee.

 

“Exercise Price”
means the price at which a holder of an Option may purchase the Shares issuable
upon exercise of the Option.

 

“Fair Market Value”
means, as of any date, the value of a share of the Company’s  Common Stock determined as follows:

 

(a)                                  if
such Common Stock is then quoted on the Nasdaq National Market, its closing
price on the Nasdaq National Market on the date of determination as reported in
The Wall Street Journal;

 

(b)                                 if
such Common Stock is publicly traded and is then listed on a national
securities exchange, its closing price on the date of determination on the
principal national securities exchange on which the Common Stock is listed or
admitted to trading as reported in The Wall Street Journal; or

 

(c)                                  if
such Common Stock is publicly traded but is not quoted on the Nasdaq National
Market nor listed or admitted to trading on a national securities exchange, the
average of the closing bid and asked prices on the date of determination as
reported in The Wall Street Journal;

 

(d)                                 if
none of the foregoing is applicable, by the Committee in good faith.

 

“Family Member”
includes any of the following:

 

(a)                                  child,
stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse,
sibling, niece, nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law of the Participant, including
any such person with such relationship to the Participant by adoption;

 

(b)                                 any
person (other than a tenant or employee) sharing the Participant’s household;

 

(c)                                  a
trust in which the persons in (a) and (b) have more than fifty
percent of the beneficial interest;

 

 

(d)                                 a
foundation in which the persons in (a) and (b) or the Participant
control the management of assets; or

 

(e)                                  any
other entity in which the persons in (a) and (b) or the Participant
own more than fifty percent of the voting interest.

 

“Option”
means an award of an option to purchase Shares pursuant to Section 5.

 

“Parent”
means any corporation (other than the Company) in an unbroken chain of
corporations ending with the Company if each of such corporations other than
the Company owns stock possessing 50% or more of the total combined voting
power of all classes of stock in one of the other corporations in such chain.

 

“Participant”
means a person who receives an Award under this Plan.

 

“Performance Factors” means the factors selected by the
Committee from among the following measures to determine whether the
performance goals established by the Committee and applicable to Awards have
been satisfied:

 

(a) Net revenue and/or net revenue growth;

 

(b) Earnings before income taxes and
amortization and/or earnings before income taxes and amortization growth;

 

(c) Operating income and/or operating income
growth;

 

(d) Net income and/or net income growth;

 

(e) Earnings per share and/or earnings per
share growth;

 

(f) Total stockholder return and/or total
stockholder return growth;

 

(g) Return on equity;

 

(h) Operating cash flow return on income;

 

(i) Adjusted operating cash flow return on
income;

 

(j) Economic value added; and

 

(k) Individual confidential business objectives.

 

“Performance Period” means the period of service
determined by the Committee, not to exceed five years, during which years of
service or performance is to be measured for Restricted Stock Awards or Stock
Bonuses.

 

“Plan” means
this NIKU Corporation 2000 Stock Incentive Plan, as amended from time to time.

 

“Restricted Stock Award”
means an award of Shares pursuant to Section 6.

 

“SEC” means
the Securities and Exchange Commission.

 

“Securities Act”
means the Securities Act of 1933, as amended.

 

“Shares”
means shares of the Company’s Common Stock reserved for issuance under this
Plan, as adjusted pursuant to Sections 2 and 17, and any successor security.

 

“Stock Bonus” means an award of Shares, or cash in
lieu of Shares, pursuant to Section 6.

 

“Stock Option Agreement”
means, with respect to each Option, the signed written agreement between the
Company and the Participant setting forth the terms and conditions of the
Option.

 

“Subsidiary”
means any corporation (other than the Company) in an unbroken chain of
corporations beginning with the Company if each of the corporations other than
the last corporation in the unbroken chain owns stock possessing 50% or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.

 

“Termination”
or “Terminated” means, for purposes of
this Plan with respect to a Participant, that the Participant has for any
reason ceased to provide services as an employee, officer, consultant,
independent contractor, or advisor to the Company or a Parent or Subsidiary of
the Company.  An employee will not be
deemed to have ceased to provide services in the case of (i) sick leave, (ii) military
leave, or (iii) any other leave of absence approved by the Committee, provided,
that such leave is for a period of not more than 90 days, unless reemployment
upon the expiration of such leave is guaranteed by contract or statute or
unless provided otherwise pursuant to formal policy adopted from time to time
by the Company and issued and promulgated to employees in writing.  In the case

 

 

of any employee on an approved leave of absence, the Committee may make
such provisions respecting suspension of vesting of the Award while on leave
from the employ of the Company or a Parent or Subsidiary of the Company as it
may deem appropriate, except that in no event may an Award be exercised after
the expiration of the term set forth in the Award Agreement.  The Committee will have sole discretion to
determine whether a Participant has ceased to provide services and the
effective date on which the Participant ceased to provide services (the “Termination Date”).

 

“Unvested Shares”
means “Unvested Shares” as defined in the Award Agreement.

 

“Vested Shares”
means “Vested Shares” as defined in the Award Agreement.

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