Document:

Exhibit 10.20(a)

 

NONQUALIFIED

 

SUPPLEMENTAL DEFERRED
COMPENSATION PLAN

 

- PLAN DOCUMENT -

 

 

NONQUALIFIED

SUPPLEMENTAL DEFERRED COMPENSATION PLAN

- PLAN DOCUMENT -

 

SECTION 1  INTRODUCTION

 

1.1                               Adoption
of Plan and Purpose

 

This Plan is an unfunded, nonqualified
deferred compensation plan.  With the
consent of the Employer (as defined in subsection 2.16) the plan may be adopted
by executing the Adoption Agreement (as defined in subsection 2.3) in the form
attached hereto.  The Plan contains
certain variable features which the Employer has specified in the Adoption
Agreement.  Only those variable features
specified by the Employer in the Adoption Agreement will be applicable to the
Employer.

 

The purpose of the Plan is to
provide certain supplemental benefits under the Plan to a select group of
management or highly compensated Employees of the Employer (in accordance with
Sections 201, 301 and 401 of ERISA), Members of the Board(s) of the
Employer, or Other Service Providers to the Employer (as defined below), and to
allow such Employees, Board Members or Other Service Providers the opportunity
to defer a portion of their salaries, bonuses and other compensation, subject
to the terms of the Plan.  Participants
(and their Beneficiaries) shall have only those rights to payments as set forth
in the Plan and shall be considered general, unsecured creditors of the
Employer with respect to any such rights. 
The Plan is designed to comply with the American Jobs Creation Act of 2004
(the “Jobs Act”) and Code Section 409A. 
It is intended that the Plan be interpreted according to a good faith
interpretation of the Jobs Act and Code Section 409A, and consistent with
published IRS guidance, including proposed and final IRS regulations under Code
Section 409A. Treatment of amounts in the Plan under any transition rules provided
under all IRS and other guidance in connection with the Jobs Act or Code Section 409A
shall be expressly authorized hereunder in accordance with procedures developed
by the Administrator.  In the event of
any inconsistency between the terms of the Plan and the Jobs Act or Code Section 409A
(and regulations thereunder), the terms of the Jobs Act and Code Section 409A
(and the regulations thereunder) shall control. 
The Plan is intended to constitute an account balance plan (as defined
in IRS Notice 2005-1, Q&A-9).

 

By becoming a Participant and
making deferrals under this Plan, each Participant agrees to be bound by the
provisions of the Plan and the determinations of the Employer and the
Administrator hereunder.

 

1.2                               Adoption
of the Plan

 

The Employer may adopt the Plan by completing
and signing the Adoption Agreement in the form attached hereto.

 

1.3                               Plan
Year

 

The Plan is administered on the
basis of a Plan Year, as defined in subsection 2.27.

 

1

 

1.4                               Plan
Administration

 

The plan shall be administered
by a plan administrator (the “Administrator,” as that term is defined in Section 3(16)(A) of
ERISA) designated by the Employer in the Adoption Agreement.  The Administrator has full discretionary
authority to construe and interpret the provisions of the Plan and make factual
determinations thereunder, including the power to determine the rights or
eligibility of employees or participants and any other persons, and the amounts
of their benefits under the plan, and to remedy ambiguities, inconsistencies or
omissions, and such determinations shall be binding on all parties.  The Administrator from time to time may adopt
such rules and regulations as may be necessary or desirable for the proper
and efficient administration of the Plan and as are consistent with the terms
of the Plan.  The administrator may
delegate all or any part of its powers, rights, and duties under the Plan to
such person or persons as it may deem advisable, and may engage agents to
provide certain administrative services with respect to the Plan.  Any notice or document relating to the Plan
which is to be filed with the Administrator may be delivered, or mailed by
registered or certified mail, postage pre-paid, to the Administrator, or to any
designated representative of the Administrator, in care of the Employer, at its
principal office.

 

1.5                               Transition
Rules Under Code Section 409A for 2005-2008

 

The Administrator or the
Employer may permit Participants to make special deferral election changes in
2005, or to make changes to the timing and form of payment of any Participant’s
benefits under the Plan under special rules under Code Section 409A,
the Proposed and Final Regulations thereunder, and related IRS Notices, Revenue
Rulings and other issued guidance.  To
the extent such special elections or changes were permitted by the
Administrator or the Employer in accordance with Code Section 409A, such
changes and elections shall be administered in accordance with Code Section 409A
and all applicable guidance on and after January 1, 2009.

 

2

 

SECTION 2  DEFINITIONS

 

2.1                               Account

 

“Account” means all notional
accounts and subaccounts maintained for a Participant in order to reflect his
interest under the Plan, as described in Section 6.

 

2.2                               Administrator

 

“Administrator” means the
individual or individuals (if any) delegated authority by the Employer to
administer the Plan, as defined in subsection 1.4.

 

2.3                               Adoption
Agreement

 

“Adoption Agreement” shall mean
the form executed by the Employer and attached hereto, which Agreement shall
constitute a part of the Plan.

 

2.4                               Beneficiary

 

“Beneficiary” means the person
or persons to whom a deceased Participant’s benefits are payable under
subsection 9.5.

 

2.5                               Board

 

“Board” means the Board of
Directors of the Employer (if applicable), as from time to time constituted.

 

2.6                               Board
Member

 

“Board Member” means a member
of the Board.

 

2.7                               Bonus

 

“Bonus” (also referred to
herein as a “Non-Performance-Based Bonus) means an award of cash that is not a
Performance-Based Bonus (as defined in subsection 2.25) that is payable to an
Employee (or Board Member or Other Service Provider, as applicable) in a given
year, with respect to the immediately preceding Bonus performance period, which
may or may not be contingent upon the achievement of specified performance
goals.

 

2.8                               Code

 

“Code” means the Internal
Revenue Code of 1986, as amended. 
Reference to a specific section of the Code shall include such section,
any valid regulation promulgated thereunder, and any comparable provision of
any future legislation amending, supplementing, or superseding such section.

 

3

 

2.9                               Compensation

 

“Compensation” shall mean the
amount of a Participant’s remuneration from the Employer designated in the
Adoption Agreement.   Notwithstanding the
foregoing, the Compensation of an Other Service Provider (as defined in
subsection 2.22) shall mean his remuneration from the Employer pursuant to an
agreement to provide services to the Employer.  
With respect to any Participant who is a Member of the Board (if
applicable), “Compensation” means all cash remuneration which, absent a
deferral election under the Plan, would have otherwise been received by the
Board Member in the taxable year, payable to the Board Member for service on
the Board and on Board committees, including any cash payable for attendance at
Board meetings and Board committee meetings, but not including any amounts
constituting reimbursements of expenses to Board Members.   To the extent the Employer has designated “401(k) Refunds”
in the Adoption Agreement (and to the extent elected by the Participant), an
amount equal to the Participant’s “401(k) Refund” shall be deferred from
the Participant’s Compensation otherwise payable to the Participant in the next
subsequent Compensation pay period (or such later pay period as the
Administrator determines shall be administratively feasible), and shall be
credited to the Participant’s Compensation Deferral Account in accordance with
subsection 4.1.  For purposes of this
subsection, “401(k) Refund” means any amount distributed to the applicable
Participant from the Employer’s qualified retirement plan intended to comply
with Section 401(k) of the Code that is in excess of the maximum
deferral for the prior calendar year allowable under such qualified retirement
plan.   Notwithstanding the foregoing,
the definition of compensation for purposes of determining key employees under
subsection 9.3 of the Plan shall be determined solely in accordance with
subsection 9.3.  To the extent not
otherwise designated by the Employer in a separate document forming part of the
Plan, Compensation payable after December 31 of a given year solely for
services performed during the Employer’s final payroll period containing December 31,
is treated as Compensation payable for services performed in the subsequent
year in which the non-deferred portion of the payroll payment is actually made.

 

2.10                        Compensation
Deferrals

 

“Compensation Deferrals” means
the amounts credited to a Participant’s Compensation Deferral Account pursuant
to the Participant’s election made in accordance with subsection 4.1.

 

2.11                        Deferral
Election

 

“Deferral Election” means an
election by a Participant to make Compensation Deferrals or Performance-Based
Bonus Deferrals in accordance with Section 4.

 

2.12                        Disability

 

“Disability” for purposes of this Plan shall
mean the occurrence of an event as a result of which the Participant is
considered disabled, as designated by the Employer in the Adoption Agreement.

 

4

 

2.13                        Effective
Date

 

“Effective Date” means the
Effective Date of the Plan, as indicated in the Adoption Agreement.

 

2.14                        Eligible
Individual

 

“Eligible Individual” means
each Board Member, Other Service Provider, or Employee of an Employer who
satisfies the eligibility requirements set forth in the Adoption Agreement, for
the period during which he is determined by the Employer to satisfy such
requirements.

 

2.15                        Employee

 

“Employee” means a person who
is employed by an Employer and is treated and/or classified by the Employer as
a common law employee for purposes of wage withholding for Federal income
taxes.  If a person is not considered to
be an Employee of the Employer in accordance with the preceding sentence, a
subsequent determination by the Employer, any governmental agency, or a court
that the person is a common law employee of the Employer, even if such
determination is applicable to prior years, will not have a retroactive effect
for purposes of eligibility to participate in the Plan.

 

2.16                        Employer

 

“Employer” means the business
entity designated in the Adoption Agreement, and its successors and assigns
unless otherwise herein provided, or any other corporation or business
organization which, with the consent of the Employer, or its successors or
assigns, assumes the Employer’s obligations hereunder, and any affiliate or
subsidiary of the Employer, as defined in Subsections 414(b) and (c) of
the Code and Section 1.409A-1(h) of the Treasury Regulations, or
other corporation or business organization that has adopted the Plan on behalf
of its Eligible Individuals with the consent of the Employer.

 

2.17                        Employer
Contributions

 

“Employer Contributions” means
the amounts other than Matching Contributions that are credited to a
Participant’s Employer Contributions Account under the Plan by the Employer in
accordance with subsection 4.4.

 

2.18                        ERISA

 

“ERISA” means the Employee
Retirement Income Security Act of 1974, as amended.  Reference to a specific section of ERISA
shall include such section, any valid regulation promulgated thereunder, and
any comparable provision of any future legislation amending, supplementing, or
superseding such section.

 

5

 

2.19                        Fiscal
Year Compensation

 

“Fiscal Year Compensation”
means Compensation relating to a period of service coextensive with one or more
consecutive non-calendar-year fiscal years of the Employer, where no amount of
such Compensation is paid or payable during the service period.  For example, a Bonus based upon a service
period of two consecutive fiscal years payable after the completion of the
second fiscal year would be “Fiscal Year Compensation,” but periodic salary
payments or Bonuses based on service periods other than the Employer’s fiscal
year would not be Fiscal Year Compensation.

 

2.20                        Investment
Funds

 

“Investment Funds” means the
notional funds or other investment vehicles designated pursuant to subsection
5.1.

 

2.21                        Matching
Contributions

 

“Matching Contributions” means
the amounts credited to a Participant’s Employer Contribution Account under the
Plan by the Employer that are based on the amount of Participant Deferrals made
by the Participant under the Plan, or that are based upon such other formula as
designated by the Employer in the Adoption Agreement, in accordance with
subsection 4.3.

 

2.22                        Other
Service Providers

 

“Other Service Providers” shall
mean independent contractors, consultants, or other similar providers of
services to the Employer, other than Employees and Board Members.  To the extent that an Other Service Provider
is unrelated to the Employer, as described in Code Section 409A and other
applicable regulations, guidance, etc. thereunder, the provisions of such
guidance shall not apply.  To the extent
that an Other Service Provider uses an accrual method of accounting for a given
taxable year, amounts deferred under the Plan in such taxable year shall not be
subject to Code Section 409A and other applicable guidance thereunder,
notwithstanding any provision of the Plan to the contrary.

 

2.23                        Participant

 

“Participant” means an Eligible
Individual who meets the requirements of Section 3 and elects to make
Compensation Deferrals pursuant to Section 4, or who receives Employer
Contributions or Matching Contributions pursuant to subsection 4.3 or 4.4.  A Participant shall cease being a Participant
in accordance with subsection 3.2 herein.

 

2.24                        Participant
Deferrals

 

“Participant Deferrals” means
all amounts deferred by a Participant under this Plan, including Participant
Compensation Deferrals and Participant Performance-Based Bonus Deferrals.

 

6

 

2.25                        Performance-Based
Bonus

 

“Performance-Based Bonus”
generally means Compensation where the amount of, or entitlement to, the
compensation is contingent on the satisfaction of previously established
organizational or individual performance criteria relating to a performance
period of at least 12 consecutive months in which the Eligible Individual
performs services, pursuant to rules described in Treasury Regulation Section 1.409A-1(e).

 

2.26                        Performance-Based
Bonus Deferrals

 

“Performance-Based Bonus
Deferrals” means the amounts credited to a Participant’s Compensation Deferral
Account from the Participant’s Performance-Based Bonus  pursuant
to the Participant’s election made in accordance with subsection 4.2.

 

2.27                        Plan Year

 

“Plan Year” means each 12-month
period specified in the Adoption Agreement, on the basis of which the Plan is
administered.

 

2.28                        Retirement

 

“Retirement” for purposes of
this Plan means the Participant’s Termination Date, as defined in subsection
2.30, after attaining any age and/or service minimums with respect to
Retirement or Early Retirement as designated by the Employer in the Adoption
Agreement.

 

2.29                        Spouse

 

“Spouse” means the person to
whom a Participant is legally married under applicable state law at the earlier
of the date of the Participant’s death or the date payment of the Participant’s
benefits commenced and who is living on the date of the Participant’s death.

 

2.30                        Termination
Date

 

“Termination Date” means (i) with
respect to an Employee Participant, the Participant’s separation from service
(within the meaning of Section 409A of the Code and the regulations,
notices and other guidance thereunder, including death or Disability) with the
Employer, and any subsidiary or affiliate of the Employer as defined in Sections 414(b) and
(c) of the Code and Section 1.409A-1(h) of the Treasury
Regulations; (ii) with respect to a Board Member Participant, the
Participant’s resignation or removal from the Board (for any reason, including
death or Disability); and (iii) with respect to any Other Service
Provider, the expiration of all agreements to provide services to the Employer
(for any reason, including death or Disability).  The date that an Employee’s, Board Member’s,
or Other Service Provider’s performance of services for all the Employers is
reduced to a level less than 20% of the average level of services performed in
the preceding 36-month period, shall be considered a Termination Date, and the
performance of services at a level of 50% or more of the average level of services
performed in the preceding 36-month period shall not be considered a
Termination Date, based on the parties’ 

 

7

 

reasonable
expectations as of the applicable date. A Participant’s Termination Date shall
not be deemed to have occurred if the Employee’s, Board Member’s or Other
Service Provider’s average level of service performed in the preceding 36-month
period drops below 50% but not less than 20%, unless the Employer: (i) has
designated in a writing forming part of the Plan that a level between 20% and
50% will be deemed to trigger a Termination Date, and (ii) such writing
was in place prior to the Participant’s Termination Date.  If such designation is subsequently changed,
the change must comply with the rules regarding subsequent deferrals and
the acceleration of payments described in Code Section 409A and the
regulations, notices, rulings and other guidance thereunder.  If a Participant is both a Board Member
Participant and an Employee Participant, “Termination Date” means the date the
Participant satisfies both criteria (i) and (ii) above.

 

2.31                        Valuation
Date

 

“Valuation Date” means the last
day of each Plan Year and any other date that the Employer, in its sole
discretion, designates as a Valuation Date, as of which the value of an
Investment Fund is adjusted for notional deferrals, contributions,
distributions, gains, losses, or expenses.

 

2.32                        Other
Definitions

 

Other defined terms used in the
Plan shall have the meanings given such terms elsewhere in the Plan.

 

8

 

SECTION 3  ELIGIBILITY AND PARTICIPATION

 

3.1                               Eligibility

 

Each Eligible Individual on the
Effective Date of the Plan shall be eligible to become a Participant by
properly making a Deferral Election on a timely basis as described in Section 4,
or, if applicable and eligible as designated by the Employer in the Adoption
Agreement, by receiving a Matching Contribution or other Employer Contribution
under the Plan.  Each other Eligible
Individual may become a Participant by making a Deferral Election on a timely
basis as described in Section 4 or, if applicable and eligible as
designated by the Employer in the Adoption Agreement, by receiving a Matching
Contribution or other Employer Contribution under the Plan.  Each Eligible Individual’s decision to become
a Participant by making a Deferral Election shall be entirely voluntary.  The Employer may require the Participant to
complete any necessary forms or other information as it deems necessary or
advisable prior to permitting the Eligible Individual to commence participation
in the Plan.

 

3.2                               Cessation
of Participation

 

If a Termination Date occurs
with respect to a Participant, or if a Participant otherwise ceases to be an
Eligible Individual, no further Compensation Deferrals, Performance-Based Bonus
Deferrals, Matching Contributions or other Employer Contributions shall be
credited to the Participant’s Accounts after the Participant’s Termination Date
or date the Participant ceases to be eligible (or as soon as administratively
feasible after the date the Participant ceases to be eligible), unless he is
again determined to be an Eligible Individual, but the balance credited to his
Accounts shall continue to be adjusted for notional investment gains and losses
under the terms of the Plan and shall be distributed to him at the time and
manner set forth in Section 9.  An
Employee, Board Member or Other Service Provider shall cease to be a
Participant after his Termination Date or other loss of eligibility as soon as
his entire Account balance has been distributed.

 

3.3                               Eligibility
for Matching or Employer Contributions

 

An Employee Participant who has
satisfied the requirements necessary to become an Eligible Individual with
respect to Matching Contributions as specified in the Adoption Agreement, and
who has made a Compensation Deferral election pursuant to subsection 4.1 herein
or who has satisfied such other criteria as specified in the Adoption
Agreement, shall be eligible to receive Matching Contributions described in
subsection 4.3.  An Employee Participant
who has satisfied the requirements necessary to become an Eligible Individual
with respect to Employer Contributions other than Matching Contributions as
specified in the Adoption Agreement, shall be eligible to receive Employer
Contributions described in subsection 4.4.

 

9

 

SECTION 4  DEFERRALS AND CONTRIBUTIONS

 

4.1                               Compensation
Deferrals Other Than Performance-Based Bonus Deferrals

 

Each Plan Year, an Eligible
Individual may elect to defer receipt of no less than the minimum and no
greater than the maximum percentage or amount selected by the Employer in the
Adoption Agreement with respect to each type of Compensation (other than
Performance-Based Bonuses) earned with respect to pay periods beginning on and
after the effective date of the election; provided, however, that Compensation
earned prior to the date the Participant satisfies the eligibility requirements
of Section 3 shall not be eligible for deferral under this Plan. Except as
otherwise provided in this subsection, a Participant’s Deferral Election for a
Plan Year under this subsection must be made not later than December 31 of
the preceding Plan Year (or such earlier date as determined by the
Administrator) with respect to Compensation (other than Performance-Based
Bonuses) earned in pay periods beginning on or after the following January 1
in accordance with rules established by the Administrator.

 

An Employee, Board Member or
Other Service Provider who first becomes an Eligible Individual during a Plan
Year (by virtue of a promotion, Compensation increase, commencement of
employment with the Employer, commencement of Board service, execution of an
agreement to provide services to an Employer, or any other reason) shall be
provided enrollment documents (including Deferral Election forms) as soon as
administratively feasible following such initial notification of eligibility.  Such Eligible
Individual must make his Deferral Elections within 30 days after first becoming
an Eligible Individual, with respect to his Compensation (other than
Performance-Based Bonuses) earned on or after the effective date of the
Deferral Election (provided, however, that if such Eligible Individual is
participating in any other account balance plan maintained by the Employer or
any member of the Employer’s “controlled group” (as defined in subsections 414(b) and
(c) of the Code), such Eligible Individual must make his Compensation
Deferral Election no later than December 31 of the preceding Plan Year (or
such earlier date as determined by the Administrator), or he may not elect to
make Compensation Deferrals for that initial Plan Year).  If an Eligible Individual does not elect to
make Compensation Deferrals during that initial 30-day period, he may not later
elect to make Compensation Deferrals for that year under this subsection.  In the event that an Eligible Individual
first becomes eligible during a Plan Year with respect to which Fiscal Year
Compensation is payable, such Eligible Individual must make his Fiscal Year
Compensation Deferral Election on or before the end of the fiscal year of the
Employer immediately preceding the first fiscal year in which any services are
performed for which the Fiscal Year Compensation is payable.

 

In the case of an Employee,
Board Member or Other Service Provider who is rehired (or who recommences Board
Service or recommences providing services to an Employer as an Other Service
Provider) after having previously been an Eligible Individual, the phrase “first
becomes an Eligible Individual” in the first sentence of the preceding
paragraph shall be interpreted to apply only where the Eligible Individual
either (i) previously received payment of his total Account balances under
the Plan, or (ii) did not previously receive payment of his total Account
balances under the Plan, but is rehired (or recommences Board Service or
recommences 

 

10

 

providing
services to an Employer as an Other Service Provider) at least 24 months after
his last day as a previously Eligible Individual prior to again becoming such
an Eligible Individual.  In all other
cases such rehired Employee, Board Member or Other Service Provider may not
elect to make Compensation Deferrals until the next date determined by the
Administrator with respect to Compensation earned after the following January 1.  Similarly, in the case of an Employee who
recommences status as an Eligible Individual for any other reason after having
previously lost his status as an Eligible Individual (due to Compensation
fluctuations, transfer from an ineligible location or job classification, or
otherwise), the phrase “first becomes an Eligible Individual” shall be
interpreted to apply only where the Eligible Individual either:  (i) previously received payment of his
total Account balances under the Plan, or (ii) did not previously receive
payment of his total Account balances under the Plan, but regains his status as
an Eligible Individual at least 24 months after his last day as a previously
Eligible Individual prior to again becoming such an Eligible Individual.  In all other cases such Re-Eligible
Participant may not elect to make Compensation Deferrals until the next date
determined by the Administrator with respect to Compensation earned after the
following January 1.

 

An election to make
Compensation Deferrals under this subsection 4.1 shall remain in effect through
the last pay period commencing in the calendar year to which the election
applies (except as provided in subsection 4.5), shall apply with respect to the
applicable type of Compensation (other than Performance-Based Bonuses) to which
the Deferral Election relates earned for pay periods commencing in the
applicable calendar year to which the election applies while the Participant
remains an Eligible Individual, and shall be irrevocable (provided, however,
that a Participant making a Deferral Election under this subsection may change
his election at any time prior to December 31 of the year preceding the
year for which the Deferral Election is applicable, subject to rules established
by the Administrator).   If a Participant
fails to make a Compensation Deferral election for a given Plan Year, such
Participant’s Compensation Deferral Election for that Plan Year shall be deemed
to be zero; provided, however, that if the Employer has elected in the Adoption
Agreement that a Participant’s Compensation Deferral Election shall be “evergreen”,
then such Participant’s Compensation Deferral Election shall be deemed to be
identical to the most recent applicable Deferral Election on file with the
Administrator with respect to the applicable type of Compensation; provided,
however, that no In-Service Distribution shall be applicable to any amounts
deferred in a year in which the Participant fails to make an affirmative
election, and payment of such amounts for such year shall be made in accordance
with his most recent election on file with the Administrator (if no election is
on file, then such amounts shall be paid to him in a single lump sum).

 

Compensation Deferrals shall be
credited to the Participant’s Compensation Deferral Account as soon as
administratively feasible after such amounts would have been payable to the
Participant.

 

4.2                               Performance-Based
Bonus Deferrals

 

Each Plan Year, an Eligible
Individual may elect to defer receipt of no less than the minimum and no
greater than the maximum percentage or amount selected by the Employer in the
Adoption Agreement with respect to Performance-Based Bonuses earned with
respect to the 

 

11

 

performance
period for which the Performance-Based 
Bonus is earned; provided, however, that the Eligible Individual
performed services continuously from a date no later than the date upon which
the performance criteria are established through a date no earlier than the
date upon which the Eligible Individual makes a Performance-Based Bonus
Deferral Election; and further provided that in no event may an election to
defer Performance-Based Bonuses be made after such Bonuses have become readily
ascertainable.  Except as otherwise
provided in this subsection, a Participant’s Performance-Based Bonus Deferral
Election under this subsection must be made not later than six months (or such
earlier date as determined by the Administrator) prior to the end of the
performance period.

 

An Employee, Board Member or
Other Service Provider who first becomes an Eligible Individual during a Plan
Year (by virtue of a promotion, Compensation increase, commencement of
employment with the Employer, commencement of Board service, execution of an
agreement to provide services to an Employer, or any other reason) shall be
provided enrollment documents (including Deferral Election forms) as soon as
administratively feasible following such initial notification of eligibility.  Such Eligible
Individual must make his Performance-Based Bonus Deferral Election within 30
days after first becoming an Eligible Individual (provided, however, that if
such Eligible Individual is participating in any other account balance plan
maintained by the Employer or any member of the Employer’s “controlled group”
(as defined in subsections 414(b) and (c) of the Code), such Eligible
Individual must make his Performance-Based Bonus Deferral Election no later
than six months (or such earlier date as determined by the Administrator) prior
to the end of the performance period, or he may not elect to make
Performance-Based Bonus Deferrals for such initial Plan Year.  In the case of a Deferral Election in the
first year of eligibility that is made after the beginning of the
Performance-Based Bonus performance period, the Deferral Election will apply to
the portion of the Performance-Based Bonus equal to the total amount of the
Performance-Based Bonus for the performance period multiplied by the ratio of
the number of days remaining in the performance period after the effective date
of the Deferral Election over the total number of days in the Performance
Period.  If an Eligible Individual does
not elect to make a Performance-Based Bonus Deferral during that initial 30-day
period, he may not later elect to make a Performance-Based Bonus Deferral for
that performance period under this subsection. 
Rules relating to the timing of elections to make a
Performance-Based Bonus Deferral with respect to an Employee, Board Member or
Other Service Provider who becomes an Eligible Individual (due to rehire or
other similar event) after having previously been an Eligible Individual shall
be applied in a manner similar to rules described applicable to rehired
and other Re-Eligible Participants in subsection 4.1 above.

 

An election to make
Performance-Based Bonus Deferrals under this subsection 4.2 shall remain in
effect through the end of the performance period to which the election applies
(except as provided in subsection 4.5), and shall be irrevocable (provided,
however, that a Participant making a Performance-Based Bonus Deferral Election
under this subsection may change his election at any time prior to the first
day of the six-month period ending on the last day of the performance period
for which the Performance-Based Bonus Deferral Election is applicable, subject
to rules established by the Administrator).   If a Participant fails to make a
Performance-Based Bonus Deferral Election for a given performance period, such
Participant’s Performance-Based Bonus Deferral Election for that performance
period shall be deemed to be zero; provided, 

 

12

 

however, that
if the Employer has elected in the Adoption Agreement that a Participant’s
Performance-Based Deferral Election shall be “evergreen”, then such Participant’s
Performance-Based Bonus Deferral Election shall be deemed to be identical to
the most recent applicable Performance-Based Bonus Deferral Election on file
with the Administrator; provided, however, that no In-Service Distribution
shall be applicable to any amounts deferred in a year in which the Participant
fails to make an affirmative election, and payment of such amounts for such
year shall be made in accordance with his most recent election on file with the
Administrator (if no election is on file, then such amounts shall be paid to
him in a single lump sum).

 

Performance-Based Bonus
Deferrals shall be credited to the Participant’s Compensation  Deferral Account as soon as administratively
feasible after such amounts would have been payable to the Participant.

 

4.3                               Matching
Contributions

 

Matching Contributions shall be
determined in accordance with the formula specified in the Adoption Agreement,
and shall be credited to the Employer Contribution Accounts of Participants who
have satisfied the eligibility requirements for Matching Contributions
specified in the Adoption Agreement. 
Matching Contributions under this Plan shall be credited to such Participants’
Employer Contribution Accounts as soon as administratively feasible after the
Applicable Period selected in the Adoption Agreement, but only with respect to
Participants eligible to receive such Matching Contributions as described in
the Adoption Agreement.

 

4.4                               Other
Employer Contributions

 

Employer Contributions other
than Matching Contributions shall be discretionary from year to year, and shall
be credited to the Employer Contribution Accounts of Participants who have
satisfied the eligibility requirements for Employer Contributions, all as
determined by the Employer and documented in writing, and such writings will
form part of the Plan, as specified in the Adoption Agreement.  Employer Contributions under this Plan shall
be credited to such Participants’ Employer Contributions Accounts as soon as
administratively feasible.

 

4.5                               No
Election Changes During Plan Year

 

A Participant shall not be
permitted to change or revoke his Deferral Elections (except as otherwise
described in subsections 4.1 and 4.2), except that, if a Participant’s status
changes such that he becomes ineligible for the Plan, the Participant’s
Deferrals under the Plan shall cease as described in subsection 3.2.  Notwithstanding the
foregoing, in the event the Employer maintains a qualified plan designed to
comply with the requirements of Code Section 401(k) that requires the
cessation of all deferrals in the event of a hardship withdrawal under such
plan, the Participant’s Deferrals under this Plan shall cease as soon as
administratively feasible upon notification to the Administrator that the
participant has taken such a hardship withdrawal.  Notwithstanding the foregoing, if the
Employer has elected in the Adoption Agreement to permit Unforeseeable
Emergency Withdrawals pursuant to subsection 9.8, the Participant’s Deferrals
under this Plan shall cease as soon as administratively feasible upon approval
by the 

 

13

 

Administrator
of a Participant’s properly submitted request for an Unforeseeable Emergency
Withdrawal under subsection 9.8.

 

4.6                               Crediting
of Deferrals

 

The amount of deferrals
pursuant to subsections 4.1 and 4.2 shall be credited to the Participant’s
Accounts as of a date determined to be administratively feasible by the Administrator.

 

4.7                               Reduction
of Deferrals or Contributions

 

Any Participant Deferrals or
Employer Contributions to be credited to a Participant’s Account under this Section may
be reduced by an amount equal to the Federal or state income, payroll, or other
taxes required to be withheld on such deferrals or contributions or to satisfy
any necessary contributions under an employee welfare benefit plan described
under Section 125 of the Code.  A
Participant shall be entitled only to the net amount of such deferral or
contribution (as adjusted from time to time pursuant to the terms of the
Plan).  The Administrator may limit a
Participant’s Deferral Election if, as a result of any election, a Participant’s
Compensation from the Employer would be insufficient to cover taxes,
withholding, and other required deductions applicable to the Participant.

 

14

 

SECTION 5  NOTIONAL INVESTMENTS

 

5.1                               Investment
Funds

 

The Employer may designate, in
its discretion, one or more Investment Funds for the notional investment of
Participants’ Accounts.  The Employer, in
its discretion, may from time to time establish new Investment Funds or
eliminate existing Investment Funds.  The
Investment Funds are for recordkeeping purposes only and do not allow
Participants to direct any Employer assets (including, if applicable, the
assets of any trust related to the Plan). 
Each Participant’s Accounts shall be adjusted pursuant to the
Participant’s notional investment elections made in accordance with this Section 5,
except as otherwise determined by the Employer or Administrator in their sole
discretion.

 

5.2                               Investment
Fund Elections

 

The Employer shall have full
discretion in the direction of notional investments of Participants’ Accounts
under the Plan; provided, however, that if the Employer so elects in the
Adoption Agreement, each Participant may elect from among the Investment Funds
for the notional investment of such of his Accounts as are permitted under the
Adoption Agreement from time to time in accordance with procedures established
by the Employer.  The Administrator, in
its discretion, may adopt (and may modify from time to time) such rules and
procedures as it deems necessary or appropriate to implement the notional
investment of the Participant’s Accounts. 
Such procedures may differ among Participants or classes of
Participants, as determined by the Employer or the Administrator in its
discretion.  The Employer or Administrator
may limit, delay or restrict the notional investment of certain Participants’
Accounts, or restrict allocation or reallocation into specified notional
investment options, in accordance with rules established in order to
comply with Employer policy and applicable law, to minimize regulated filings
and disclosures, or under any other circumstances in the discretion of the
Employer.  Any deferred amounts subject
to a Participant’s investment election that must be so limited, delayed or
restricted under such circumstances may be notionally invested in an Investment
Fund designated by the Administrator, or may be credited with earnings at a
rate determined by the Administrator, which rate may be zero.  A Participant’s notional investment election
shall remain in effect until later changed in accordance with the rules of
the Administrator.  If a Participant does
not make a notional investment election, all deferrals by the Participant and
contributions on his behalf will be deemed to be notionally invested in the
Investment Fund designated by the Employer for such purpose, or, at the
Employer’s election, may remain uninvested until such time as the Administrator
receives proper direction, or may be credited with earnings at a rate
determined by the Administrator or Employer, which rate may be zero.

 

5.3                               Investment
Fund Transfers

 

A Participant may elect that
all or a part of his notional interest in an Investment Fund shall be
transferred to one or more of the other Investment Funds.  A Participant may make such notional
Investment Fund transfers in accordance with rules established from time
to time by the Employer or the Administrator, and in accordance with subsection
5.2.

 

15

 

SECTION 6  ACCOUNTING

 

6.1                               Individual
Accounts

 

Bookkeeping Accounts shall be
maintained under the Plan in the name of each Participant, as applicable, along
with any subaccounts under such Accounts deemed necessary or advisable from
time to time, including a subaccount for each Plan Year that a Participant’s
Deferral Election is in effect.  Each such
subaccount shall reflect (i) the amount of the Participant’s Deferral
during that year, any Matching Contributions or Employer Contributions credited
during that year, and the notional gains, losses, expenses, appreciation and
depreciation attributable thereto.

 

                                                Rules and
procedures may be established relating to the maintenance, adjustment, and
liquidation of Participants’ Accounts, the crediting of deferrals and
contributions and the notional gains, losses, expenses, appreciation, and
depreciation attributable thereto, as are considered necessary or advisable.

 

6.2                               Adjustment
of Accounts

 

Pursuant to rules established
by the Employer,  Participants’ Accounts
will be adjusted on each Valuation Date, except as provided in Section 9,
to reflect the notional value of the various Investment Funds as of such date,
including adjustments to reflect any deferrals and contributions, notional
transfers between Investment Funds, and notional gains, losses, expenses,
appreciation, or depreciation with respect to such Accounts since the previous
Valuation Date.  The “value” of an
Investment Fund at any Valuation Date may be based on the fair market value of
the Investment Fund, as determined by the Administrator in its sole discretion.

 

6.3                               Accounting
Methods

 

The accounting methods or
formulae to be used under the Plan for purposes of monitoring Participants’
Accounts, including the calculation and crediting of notional gains, losses,
expenses, appreciation, or depreciation, shall be determined by the
Administrator in its sole discretion. 
The accounting methods or formulae selected by the Administrator may be
revised from time to time.

 

6.4                               Statement
of Account

 

At such times and in such
manner as determined by the Administrator, but at least annually, each
Participant will be furnished with a statement reflecting the condition of his
Accounts.

 

16

 

SECTION 7  VESTING

 

A Participant shall be fully
vested at all times in his Compensation Deferral Account (if applicable).  A Participant shall be vested in his Matching
Contributions and/or Employer Contributions (if applicable), in accordance with
the vesting schedule elected by the Employer under the Adoption Agreement.  Vesting Years of Service shall be determined
in accordance with the election made by the Employer in the Adoption
Agreement.  Amounts in a Participant’s
Accounts that are not vested upon the Participant’s Termination Date (“forfeitures”)
shall be used to reinstate amounts previously forfeited by other Participants
who are subsequently rehired, or shall be returned to the Employer, in the
discretion of the Employer or the Administrator.

 

If a Participant has a
Termination Date with the Employer as a result of the Participant’s Misconduct
(as defined by the Employer in the Adoption Agreement), or if the Participant
engages in Competition with the Employer (as defined by the Employer in the
Adoption Agreement), and the Employer has so elected in the Adoption Agreement,
the Participant shall forfeit all amounts allocated to his or her Matching
Contribution Account and/or Employer Contribution Accounts (if
applicable).  Such forfeitures shall be
returned to the Employer.

 

Neither the Administrator nor
the Employer in any way guarantee the Participant’s Account balance from loss
or depreciation.  Notwithstanding any
provision of the Plan to the contrary, the Participant’s Account balance is
subject to Section 8.

 

Vesting Years of Service in the
event of the rehire of a Participant shall be reinstated, and amounts previously
forfeited by such Participants shall be reinstated from forfeitures made by
other Participants, or shall be reinstated by the Employer.

 

17

 

SECTION 8  FUNDING

 

No Participant or other person
shall acquire by reason of the Plan any right in or title to any assets, funds,
or property of the Employer whatsoever, including, without limiting the
generality of the foregoing, any specific funds, assets, or other property of
the Employer.  Benefits under the Plan
are unfunded and unsecured.  A
Participant shall have only an unfunded, unsecured right to the amounts, if
any, payable hereunder to that Participant. 
The Employer’s obligations under this Plan are not secured or funded in
any manner, even if the Employer elects to establish a trust with respect to
the Plan.  Even though benefits provided
under the Plan are not funded, the Employer may establish a trust to assist in
the payment of benefits.  All investments
under this Plan are notional and do not obligate the Employer (or its
delegates) to invest the assets of the Employer or of any such trust in a
similar manner.

 

18

 

SECTION 9  DISTRIBUTION
OF ACCOUNTS

 

9.1                               Distribution of
Accounts

 

With respect to any Participant who has a
Termination Date that precedes his Retirement date, an amount equal to the
Participant’s vested Account balances shall be distributed to the Participant
(or, in the case of the Participant’s death, to the Participant’s Beneficiary),
in the form of a single lump sum payment, or, if subsection 9.2 applies, in the
form of installment payments as designated by the Employer in the Adoption
Agreement.  Subject to subsection 9.3
hereof, distribution of a Participant’s Accounts shall be made within the
90-day period following the Participant’s Termination Date (provided, however,
that if calculation of the amount of the payment is not administratively practicable
due to events beyond the control of the Participant, the payment will be made
as soon as administratively practicable for the Administrator to make such
payment).    Notwithstanding any
provision of the Plan to the contrary, for purposes of this subsection, a
Participant’s Accounts shall be valued as of a Valuation Date as soon as
administratively feasible preceding the date such distribution is made, in
accordance with rules established by the Administrator.  A Participant’s Accounts may be offset by any
amounts owed by the Participant to the Employer, but such offset shall not
occur in excess of or prior to the date distribution of the amount would
otherwise be made to the Participant.

 

Notwithstanding the foregoing, to the extent
designated by the Employer in the Adoption Agreement, a Participant may elect,
in accordance with this subsection, a distribution date for his Compensation
Deferral Accounts that is prior to his Termination Date (an “In-Service
Distribution”).  A Participant’s election
of an In-Service Distribution date must: (i) be made at the time of his
Deferral Election for a Plan Year; and (ii) apply only to amounts deferred
pursuant to that election, and any earnings, gains, losses, appreciation, and
depreciation credited thereto or debited therefrom with respect to such
amounts.  To the extent permitted by the
Employer, a Participant may elect an In-Service Distribution date with respect
to Performance-Based Bonus Deferrals that is separate from an In-Service
Distribution date with respect to Compensation Deferrals other than
Performance-Based Bonus Deferrals for the same year, provided that the
applicable In-Service Distribution date may not be earlier than the number of
years designated by the Employer in the Adoption Agreement following the year
in which the applicable  Compensation
would have been paid absent the deferral, or as further determined or limited
in accordance with rules established by the Administrator.  Payments made pursuant to an In-Service
Distribution election shall be made in a lump sum as soon as administratively
feasible following January 1 of the calendar year in which the payment was
elected to be made, but in no event later than the end of the calendar year in
which the payment was elected to be made (provided, however, that if
calculation of the amount of the payment is not administratively practicable
due to events beyond the control of the Participant, the payment will be made
as soon as administratively practicable for the Administrator to make such
payment).  For purposes of such payment,
the value of the Participant’s Accounts for the applicable Plan Year shall be
determined as of a Valuation Date preceding the date that such distribution is
made, in accordance with rules established by the Administrator.  In the event a Participant’s Termination Date
occurs (or, if elected by the Employer in the Adoption Agreement, in the event
a Change in Control of the Employer occurs) prior to the date the Participant
had previously elected to have 

 

19

 

an In-Service Distribution
payment made to him, such amount shall be paid to the Participant under the rules applicable
for payment on Termination of Employment in accordance with this subsection 9.1
and subsection 9.2.  No In-Service
Distribution shall be applicable to any amounts deferred in a year in which the
Participant fails to make an affirmative election, and payment of such amounts
for such year shall be made in accordance with his most recent election on file
with the Administrator (if no election is on file, then such amounts shall be
paid to him in a single lump sum).

 

To the extent elected by the Employer in the
Adoption Agreement, Participants whose Termination Date has not yet occurred
may elect to defer payment of any In-Service Distribution, provided that such
election is made in accordance with procedures established by the
Administrator, and further provided that any such election must be made no
later than 12 calendar months prior to the originally elected In-Service
Distribution Date.  Participants may
elect any deferred payment date, but such date must be no fewer than five years
from the original In-Service Distribution Date.

 

9.2                               Installment
Distributions

 

To the extent elected by the Employer in the
Adoption Agreement, a Participant may elect to receive payments from his
Accounts in the form of a single lump sum, as described in Section 9.1, or
in annual installments over a period
elected by the Employer in the Adoption Agreement.  To the extent a Participant fails to make an
election, the Participant shall be deemed to have elected to receive his
distribution for that Plan Year in the form of a single lump sum.  To the extent elected by the Employer in the
Adoption Agreement, a Participant may make a separate election with respect to
his Performance-Based Bonus Deferrals for each year (as adjusted for gains and
losses thereon) that provides for a different method of distribution from the
method of distribution he elects with respect to his Compensation Deferrals (as
adjusted for gains and losses thereon) for that year.  The Participant’s Employer Contributions
Account attributable to such year, if any (as adjusted for gains and losses
thereon), shall be distributed in the same manner as his Compensation Deferral
Account for such year.

 

(a)                                  Installment
Elections.  A
Participant will be required to make his distribution election prior to the
commencement of each calendar year (or, in the event of an election with
respect to Performance-Based Bonuses, prior to six months before the end of the
applicable performance period), or such earlier date as determined by the
Administrator.

 

(b)                                 Installment
Payments.  The first
installment payment shall generally be within the 90-day period following the
Participant’s Termination Date (provided, however, that if calculation of the
amount of the payment is not administratively practicable due to events beyond
the control of the Participant, the payment will be made as soon as
administratively practicable for the Administrator to make such payment).  Succeeding payments shall generally be made
by January 1 of each succeeding calendar year, but in no event later than
the end of each succeeding calendar year (provided, however, that if
calculation of the amount of the payment is not administratively practicable
due to events beyond the control of the Participant, 

 

20

 

the
payment will be made as soon as administratively practicable for the
Administrator to make such payment). The amount to be distributed in each
installment payment shall be determined by dividing the value of the
Participant’s Accounts as of a Valuation Date preceding the date of each
distribution by the number of installment payments remaining to be made, in accordance
with rules established by the Administrator.  In the event of the death of the Participant
prior to the full payment of his Accounts, payments will continue to be made to
his Beneficiary in the same manner and at the same time as would have been payable
to the Participant, but substituting the Participant’s date of death for the
Participant’s Retirement Date.

 

To the extent elected by the Employer in the
Adoption Agreement, Participants who have elected payment in installments may
make a subsequent election to elect payment of that amount in the form of a
lump sum, if payment of installments with respect to that year’s deferrals has
not yet commenced.  Such election must be
made in accordance with procedures established by the Administrator, and any such
election must be made no later than 12 calendar months prior to the originally
elected payment date of the first installment. 
The new payment date for the installment with respect to which such
election is made must be deferred to the later of:  (i) five years from the date such
payment would otherwise have been made, or (ii) the last payment date of
the last installment with respect to that year’s deferrals.  To the extent elected by the Employer in the
Adoption Agreement, Participants who have elected payment in installments may
make a subsequent election to change the number of such installment payments so
long as no acceleration of distribution payments occurs (but no fewer than the
minimum number, and not to exceed the maximum number of installments elected by
the Employer in the Adoption Agreement), if payment of installments with
respect to that year’s Deferral Elections has not yet commenced.  Such election must be made in accordance with
procedures established by the Administrator, and any such election must be made
no later than 12 calendar months prior to the originally elected payment date
of the first installment.  The new
payment date for any installment with respect to which such election is made
must be deferred for a period of not less than five years from the date such
payment would otherwise have been made.   
In the event payment has been elected by the Participant in the form of
installments (to the extent elected by the Employer in the Adoption Agreement),
each installment payment shall be considered a separately identifiable
payment.  In the event payment has been
elected by the Participant in the form of a lump sum (or in the event payment
shall be made to the Participant in the form of a lump sum under the terms of
the Plan in the absence of or in lieu of the Participant’s election), then the
lump sum form shall be deemed to be a separately identifiable form of payment,
and the Participant may make a subsequent deferral election to elect payment of
that amount in the form of installments (to the extent elected by the Employer
in the Adoption Agreement) in accordance with the procedures described above
for changing installment payment elections. 
Participants will be permitted to make such a change only once with
respect to any year’s Deferral Elections.

 

9.3                               Key Employees

 

Notwithstanding anything herein to the
contrary, and subject to Code Section 409A, payment under subsections 9.3
or 9.4 shall not be made or commence as a result of the 

 

21

 

Participant’s Termination
Date to any Participant who is a key employee (defined below) before the date
that is not less than six months after the Participant’s Termination Date.  For this purpose, a key employee includes a “specified
employee” (as defined in Treasury Regulation Section 1.409A-1(i)) during
the entire 12-month period determined by the Administrator ending with the
annual date upon which key employees are identified by the Administrator, and
also including any Employee identified by the Administrator in good faith with
respect to any distribution as belonging to the group of identified key
employees, to a maximum of  200 such key
employees, regardless of whether such Employee is subsequently determined by
the Employer, any governmental agency, or a court not to be a key
employee.  In the event amounts are
payable to a key employee in installments in accordance with subsection 9.2,
the first installment shall be delayed by six months, with all other
installment payments payable as originally scheduled.  To the extent not otherwise designated by the
Employer in a separate document forming a part of the Plan applicable to all
its nonqualified deferred compensation plans, the identification date for determining
the Employer’s key employees is each December 31 (and the new key employee
list is updated and effective each subsequent April 1).  To the extent not otherwise designated by the
Employer in a separate document forming a part of the Plan, the definition of
compensation used to determine key employee status shall be determined under
Treasury Regulation Section 1.415(c)-2(a). 
This subsection 9.3 is applicable only with respect to Employers whose
stock is publicly traded on an “established securities market” (as defined in
Treasury Regulation Section 1.409A-1(k)), and is not applicable to
privately held Employers unless and until such Employers become publicly traded
as defined in the Treasury regulations.

 

9.4                               Mandatory
Cash-Outs of Small Amounts

 

If the value of a Participant’s total Accounts
at his Termination Date (or his death), or at any time thereafter, is equal to
or less than such amount as stated in the Adoption Agreement (which amount
shall not exceed the limit described in Section 402(g) of the Code
from time to time), the Accounts will be paid to the Participant (or, in the
event of his death, his Beneficiary) in a single lump sum, notwithstanding any
election by the Participant otherwise. 
Payments made under this subsection 9.4 on account of the Participant’s
Termination Date shall be made within the 90-day period following the
Participant’s Termination Date (provided, however, that if calculation of the
amount of the payment is not administratively practicable due to events beyond
the control of the Participant, the payment will be made as soon as
administratively practicable for the Administrator to make such payment).

 

9.5                               Designation of
Beneficiary

 

Each Participant from time to time may
designate any individual, trust, charity or other person or persons to whom the
value of the Participant’s Accounts (plus any applicable Survivor Benefit, if
elected by the Employer in the Adoption Agreement) will be paid in the event
the Participant dies before receiving the value of all of his Accounts.  A Beneficiary designation must be made in the
manner required by the Administrator for this purpose.  Primary and secondary Beneficiaries are
permitted. A married participant designating a Beneficiary other than his
Spouse must obtain the consent of his Spouse to such designation (in accordance
with rules 

 

22

 

determined by the
Administrator). Payments to the Participant’s Beneficiary(ies) shall be made in
accordance with subsection 9.1, 9.2 or 9.4, as applicable, after the
Administrator has received proper notification of the Participant’s death.

 

A Beneficiary designation will be effective
only when the Beneficiary designation is filed with the Administrator while the
Participant is alive, and a subsequent Beneficiary designation will cancel all
of the Participant’s Beneficiary designations previously filed with the
Administrator.  Any designation or
revocation of a Beneficiary shall be effective as only if it is received by the
Administrator.  Once received, such
designation shall be effective as of the date the designation was executed, but
without prejudice to the Administrator on account of any payment made before
the change is recorded by the Administrator. 
If a Beneficiary dies before payment of the Participant’s Accounts have
been made, the Participant’s Accounts shall be distributed in accordance with
the Participant’s Beneficiary designation and pursuant to rules established
by the Administrator.  If a deceased
Participant failed to designate a Beneficiary, or if the designated Beneficiary
predeceases the Participant, the value of the Participant’s Accounts shall be
payable to the Participant’s Spouse or, if there is none, to the Participant’s
estate, or in accordance with such other equitable procedures as determined by
the Administrator.

 

9.6                               Reemployment

 

If a former Participant is rehired by an
Employer, or any affiliate or subsidiary of the Employer described in Section 414(b) and
(c) of the Code and Treasury Regulation Section 1.409A-1(h),
regardless of whether he is rehired as an Eligible Individual (with respect to
an Employee Participant), or a former Participant returns to service as a Board
member, any payments being made to such Participant hereunder by virtue of his
previous Termination Date shall continue to be made to him without regard to
such rehire.    If a former Participant
is rehired by the Employer (with respect to an Employee Participant) or returns
to service as a Board member, and in either case any payments to be made to the
Participant by virtue of his previous Termination Date have not been made or
commenced, any payments being made to such Participant hereunder by virtue of
his previous Termination Date shall continue to be made to him without regard
to such rehire or return to service.  See
subsections 4.1 and 4.2 of the Plan for special rules applicable to
deferral elections for rehired or Re-Eligible Participants.

 

9.7                               Special
Distribution Rules

 

Except as otherwise provided herein and in Section 12,
Account balances of Participants in this Plan shall not be distributed earlier
than the applicable date or dates described in this Section 9.  Notwithstanding the foregoing, in the case of
payments:  (i) the deduction for
which would be limited or eliminated by the application of Section 162(m) of
the Code; (ii) that would violate securities or other applicable laws; or (iii) that
would jeopardize the ability of the Employer to continue as a going concern in
accordance with Code Section 409A and the regulations thereunder, deferral
of such payments may be made by the Employer at the Employer’s discretion. In
the case of a payment described in (i) above, the payment must be deferred
either to a date in the first year in which the Employer or Administrator
reasonably anticipates that a payment of such amount would not result in a
limitation of a deduction with respect to the payment of such amount under Section 162(m),
or the year in which the 

 

23

 

Participant’s Termination
Date occurs.  In the case of a payment
described in (ii) or (iii) above, payment will be made in the first
calendar year in which the Employer or Administrator reasonably anticipates
that the payment would not jeopardize the ability of the Employer to continue
as a going concern in accordance with Code Section 409A and the
regulations thereunder, or the payment would not result in a violation of
securities or other applicable laws. 
Payments intended to pay employment taxes or payments made as a result
of income inclusion of an amount in a Participant’s Accounts as a result of a
failure to satisfy Section 409A of the Code shall be permitted at the
Employer or Administrator’s discretion at any time and to the extent provided
in Treasury Regulations under Section 409A of the Code and IRS Notice
2005-1, Q&A-15, and any applicable subsequent guidance.  “Employment taxes” shall include Federal
Income Contributions Act (FICA) tax imposed under Sections 3101 and 3121(v)(2) of
the Code on compensation deferred under the Plan (the “FICA Amount”), the
income tax imposed under Section 3401 of the Code on the FICA Amount, and
to pay the additional income tax under Section 3401 of the Code
attributable to the pyramiding Section 3401 wages and taxes.  A distribution may be accelerated as may be
necessary to comply with a certificate of the sale of business holdings or part
of a company, especially under legal compulsion (as defined in Section 1043(b)(2) of
the Code) with respect to certain conflict of interest rules.  With respect to a subchapter S corporation, a
distribution may be accelerated to avoid a nonallocation year under Code Section 409(p) with
respect to a subchapter S corporation in the discretion of the Employer or
Administrator, provided that the amount distributed does not exceed 125 percent
of the minimum amount of distribution necessary to avoid the occurrence of a
nonallocation year, in accordance with Treasury Regulation Section 1.409A-3(j)(4)(x).

 

9.8                               Distribution on
Account of Unforeseeable Emergency

 

If elected by the Employer in the Adoption
Agreement, if a Participant or Beneficiary incurs a severe financial hardship
of the type described below, he may request an Unforeseeable Emergency
Withdrawal, provided that the withdrawal is necessary in light of severe
financial needs of the Participant or Beneficiary.  To the extent elected by the Employer in the
Adoption Agreement, the ability to apply for an Unforeseeable Emergency
Withdrawal may be restricted to Participants whose Termination Date has not yet
occurred.  Such a withdrawal shall not
exceed the amount required (including anticipated taxes on the withdrawal) to
meet the severe financial need and not reasonably available from other
resources of the Participant (including reimbursement or compensation by
insurance, cessation of deferrals under this Plan for the remainder of the Plan
Year, and liquidation of the Participant’s assets, to the extent liquidation
itself would not cause severe financial hardship).  Each such withdrawal election shall be made
at such time and in such manner as the Administrator shall determine, and shall
be effective in accordance with such rules as the Administrator shall
establish and publish from time to time. 
Severe financial needs are limited to amounts necessary for:

 

(a)                                  A sudden
unexpected illness or accident incurred by the Participant, his Spouse, or
dependents (as defined in Code Section 152(a)).

 

(b)                                 Uninsured
casualty loss pertaining to property owned by the Participant.

 

24

 

(c)                                  Other similar
extraordinary and unforeseeable circumstances involving an uninsured loss
arising from an event outside the control of the Participant.

 

Withdrawals of amounts under this subsection
shall be paid to the Participant in a lump sum as soon as administratively
feasible following receipt of the appropriate forms and information required by
and acceptable to the Administrator.

 

9.9                               Distribution
Upon Change in Control

 

In the
event of the occurrence of a Change in Control of the Employer or a member of
the Employer’s controlled group (as designated by the Employer in the Adoption
Agreement, and to the extent certified by the Administrator that a Change in
Control has occurred), distributions shall be made to Participants to the
extent elected by the Employer in the Adoption Agreement, in the form elected
by the Participants as if a Termination Date had occurred with respect to each
Participant, or as otherwise specified by the Employer in the Adoption
Agreement.   The Change in Control shall
relate to:  (i)  the corporation for
whom the Participant is performing services at the time of the Change in
Control event; (ii) the corporation that is liable for the payment from
the Plan to the Participant (or all corporations so liable if more than one
corporation is liable); (iii) a corporation that is a majority shareholder
of a corporation described in (i) or (ii) above; or (iv) any
corporation in a chain of corporations in which each such corporation is a
majority shareholder of another corporation in the chain, ending in a
corporation described in (i) or (ii) above, as elected by the
Employer in the Adoption Agreement.  A “majority
shareholder” for these purposes is a shareholder owning more than 50% of the
total fair market value and total voting power of such corporation.  Attribution rules described in section
318(a) of the Code apply to determine stock ownership.  Stock underlying an option (whether vested or
unvested) is considered owned by the individual who holds the vested (or
unvested) option.  Notwithstanding the
foregoing, if a vested option is exercisable for stock that is not
substantially vested (as defined in section 1.83-3(b) and (j) of the
Code), the stock underlying the option is not treated as owned by the
individual who holds the option.  If plan
payments are made on account of a Change in Control and are calculated by
reference to the value of the Employer’s stock, such payments shall be
completed not later than 5 years after the Change in Control event.  To the extent designated by the Employer in
the Adoption Agreement, the Change in Control shall occur upon the date that: (v) a
person or “Group” (as defined in Treasury Regulation Sections 1.409A-3(i)(5)(v)(B) and
(vi)(D)) acquires more than 50% of the total fair market value or voting power
of stock of the corporation designated in (i) through (iv) above; (vi) a
person or Group acquires ownership (“effective control”) of stock of the
corporation with at least 30% of the total voting power of the corporation
designated in (i) through (iv) above and as further limited by Treasury
Regulation Section 1.409A-3(i)(5)(vi)); (vii) a majority of the board
of directors of the corporation designated in (i) through (iv) above
is replaced during any 12-month period by directors whose appointment or
election is not endorsed by a majority of the board as constituted prior to the
appointment or election; or (viii) a person or Group acquires 

 

25

 

assets
from the corporation designated in (i) through (iv) above having a
total fair market value of at least 40% of the value of all assets of the
corporation immediately prior to such acquisition; as designated by the
Employer in the Adoption Agreement.  For
purposes of (vi) above, if any one person, or more than one person acting
as a Group, is considered to own more than 50 percent of the total fair market
value or total voting power of the stock of a corporation, the acquisition of
additional stock by the same person or persons is not considered to cause a
change in the ownership of the corporation (or to cause a change in the
effective control of the corporation under (vi) above).  An increase in the percentage of stock owned
by any one person, or persons acting as a Group, as a result of a transaction
in which the corporation acquires its stock in exchange for property will be
treated as an acquisition of stock for purposes of this subsection.  For purposes of (v) through (viii) above,
a Change in Control shall be further limited in accordance with Treasury
Regulation Sections 1.409A-3(i)(5)(v), (vi) and (vii).  Distributions under this subsection shall be
made as soon as administratively feasible following such Change in Control.

 

9.10                        Supplemental Survivor Death
Benefit

 

A supplemental survivor
death benefit shall be paid to the Beneficiary of an eligible Participant who
has satisfied the following criteria prior to his death:

 

(a)                                  The Participant
is eligible to participate in the Plan and, at the time of his death, had a
current Account balance (regardless of whether or not the Participant actually
was making Compensation Deferrals at the time of his death);

 

(b)                                 The Participant
was an active Employee with the Employer at the time of his death;

 

(c)                                  The Participant
completed and submitted an insurance application to the Administrator; and

 

(d)                                 The Employer
subsequently purchased an insurance policy on the life of the Participant, with
a death benefit payable, which policy is in effect at the time of the
Participant’s death.

 

Notwithstanding any provision of this Plan or
any other document to the contrary, the supplemental survivor death benefit
payable pursuant to this Subsection 9.10 shall be paid only if an
insurance policy has been issued on the Participant’s life and such policy is
in force at the time of the Participant’s death and the Employer shall have no
obligation with respect to the payment of the supplemental survivor death
benefit, or to maintain an insurance policy for any Participants.

 

26

 

SECTION 10  GENERAL
PROVISIONS

 

10.1                        Interests Not Transferable

 

The interests of persons entitled to benefits
under the Plan are not subject to their debts or other obligations and, except
as may be required by the tax withholding provisions of the Code or any state’s
income tax act, may not be voluntarily or involuntarily sold, transferred,
alienated, assigned, or encumbered; provided, however, that a Participant’s
interest in the Plan may be transferable pursuant to a qualified domestic
relations order, as defined in Section 414(p) of the Code to the extent
designated by the Employer in the Adoption Agreement.

 

10.2                        Employment
Rights

 

The Plan does not constitute a contract of
employment, and participation in the Plan shall not give any Employee the right
to be retained in the employ of an Employer, nor any right or claim to any
benefit under the Plan, unless such right or claim has specifically accrued
under the terms of the Plan.  The
Employer expressly reserves the right to discharge any Employee at any time.

 

10.3                        Litigation by
Participants or Other Persons

 

If a legal action begun against the
Administrator (or any member or former member thereof), an Employer, or any
person or persons to whom an Employer or the Administrator has delegated all or
part of its duties hereunder, by or on behalf of any person results adversely
to that person, or if a legal action arises because of conflicting claims to a
Participant’s or other person’s benefits, the cost to the Administrator (or any
member or former member thereof), the Employer or any person or persons to whom
the Employer or the Administrator has delegated all or part of its duties
hereunder of defending the action shall be charged to the extent permitted by
law to the sums, if any, which were involved in the action or were payable to
the Participant or other person concerned.

 

10.4                        Indemnification

 

To the extent permitted by law, the Employer
shall indemnify each member of the Administrator committee, and any other
employee or member of the Board with duties under the Plan, against losses and
expenses (including any amount paid in settlement) reasonably incurred by such
person in connection with any claims against such person by reason of such
person’s conduct in the performance of duties under the Plan, except in
relation to matters as to which such person has acted fraudulently or in bad
faith in the performance of duties. 
Notwithstanding the foregoing, the Employer shall not indemnify any
person for any expense incurred through any settlement or compromise of any action
unless the Employer consents in writing to the settlement or compromise.

 

27

 

10.5                        Evidence

 

Evidence required of anyone
under the Plan may be by certificate, affidavit, document, or other information
which the person acting on it considers pertinent and reliable, and signed,
made, or presented by the proper party or parties.

 

10.6                        Waiver of
Notice

 

Any notice required under the
Plan may be waived by the person entitled to such notice.

 

10.7                        Controlling
Law

 

Except to the extent superseded
by laws of the United States, the laws of the state indicated by the Employer
in the Adoption Agreement shall be controlling in all matters relating to the
Plan.

 

10.8                        Statutory
References

 

Any reference in the Plan to a
Code section or a section of ERISA, or to a section of any other Federal law,
shall include any comparable section or sections of any future legislation that
amends, supplements, or supersedes that section.

 

10.9                        Severability

 

In case any provision of the
Plan shall be held illegal or invalid for any reason, such illegality or
invalidity shall not affect the remaining provisions of the Plan, and the Plan
shall be construed and enforced as if such illegal and invalid provision had
never been set forth in the Plan.

 

10.10                 Action By the
Employer or the Administrator

 

Any action required or
permitted to be taken by the Employer under the Plan shall be by resolution of
its Board of Directors (which term shall include any similar governing body for
any Employer that is not a corporation), by resolution or other action of a
duly authorized committee of its Board of Directors, or by action of a person
or persons authorized by resolution of its Board of Directors or such
committee.  Any action required or
permitted to be taken by the Administrator under the Plan shall be by
resolution or other action of the Administrator or by a person or persons duly
authorized by the Administrator.

 

10.11                 Headings and
Captions

 

The headings and captions
contained in this Plan are inserted only as a matter of convenience and for
reference, and in no way define, limit, enlarge, or describe the scope or
intent of the Plan, nor in any way shall affect the construction of any
provision of the Plan.

 

28

 

10.12                 Gender and Number

 

Where the context permits,
words in the masculine gender shall include the feminine and neuter genders,
the singular shall include the plural, and the plural shall include the
singular.

 

10.13                 Examination of
Documents

 

Copies of the Plan and any
amendments thereto are on file at the office of the Employer where they may be
examined by any Participant or other person entitled to benefits under the Plan
during normal business hours.

 

10.14                 Elections

 

Each election or request
required or permitted to be made by a Participant (or a Participant’s Spouse or
Beneficiary) shall be made in accordance with the rules and procedures
established by the Employer or Administrator and shall be effective as
determined by the Administrator.  The
Administrator’s rules and procedures may address, among other things, the
method and timing of any elections or requests required or permitted to be made
by a Participant (or a Participant’s Spouse or Beneficiary).  All elections under the Plan shall comply
with the requirements of the Uniformed Services Employment and Reemployment
Rights Act of 1994, as amended (“USERRA”).

 

10.15                 Manner of
Delivery

 

Each notice or statement
provided to a Participant shall be delivered in any manner established by the
Administrator and in accordance with applicable law, including, but not limited
to, electronic delivery.

 

10.16                 Facility of
Payment

 

When a person entitled to
benefits under the Plan is a minor, under legal disability, or is in any way
incapacitated so as to be unable to manage his financial affairs, the
Administrator may cause the benefits to be paid to such person’s guardian or
legal representative.  If no guardian or
legal representative has been appointed, or if the Administrator so determines
in its sole discretion, payment may be made to any person as custodian for such
individual under any applicable state law, or to the legal representative of
such person for such person’s benefit, or the Administrator may direct the
application of such benefits for the benefit of such person.  Any payment made in accordance with the
preceding sentence shall be a full and complete discharge of any liability for
such payment under the Plan.

 

10.17                 Missing Persons

 

The Employer and the
Administrator shall not be required to search for or locate a Participant,
Spouse, or Beneficiary.  Each
Participant, Spouse, and Beneficiary must file with the Administrator, from
time to time, in writing the Participant’s, Spouse’s, or Beneficiary’s post
office address and each change of post office address.  Any communication, statement, or notice 

 

29

 

addressed to a
Participant, Spouse, or Beneficiary at the last post office address filed with
the Administrator, or if no address is filed with the Administrator, then in
the case of a Participant, at the Participant’s last post office address as
shown on the Employer’s records, shall be considered a notification for
purposes of the Plan and shall be binding on the Participant and the
Participant’s Spouse and Beneficiary for all purposes of the Plan.

 

If the Administrator is unable
to locate the Participant, Spouse, or Beneficiary to whom a Participant’s
Accounts are payable, the Participant’s Accounts shall be frozen as of the date
on which distribution would have been completed under the terms of the Plan,
and no further notional investment returns shall be credited thereto.

 

If a Participant whose Accounts
were frozen (or his Beneficiary) files a claim for distribution of the Accounts
within 7 years after the date the Accounts are frozen, and if the Administrator
or Employer determines that such claim is valid, then the frozen balance shall
be paid by the Employer to the Participant or Beneficiary in a lump sum cash
payment as soon as practicable thereafter. 
If the Administrator notifies a Participant, Spouse, or Beneficiary of
the provisions of this Subsection, and the Participant, Spouse, or Beneficiary
fails to claim the Participant’s, Spouse’s, or Beneficiary’s benefits or make
such person’s whereabouts known to the Administrator within 7 years after the
date the Accounts are frozen, the benefits of the Participant, Spouse, or
Beneficiary may be disposed of, to the extent permitted by applicable law, by
one or more of the following methods:

 

(a)                                  By retaining such
benefits in the Plan.

 

(b)                                 By paying such
benefits to a court of competent jurisdiction for judicial determination of the
right thereto.

 

(c)                                  By forfeiting such
benefits in accordance with procedures established by the Administrator.  If a Participant, Spouse, or Beneficiary is
subsequently located, such benefits shall be restored (without adjustment) to
the Participant, Spouse, or Beneficiary under the Plan.

 

(d)                                 By any equitable
manner permitted by law under rules adopted by the Administrator.

 

10.18                 Recovery of
Benefits

 

In the event a Participant,
Spouse, or Beneficiary receives a benefit payment from the Plan that is in
excess of the benefit payment that should have been made to such Participant,
Spouse, or Beneficiary, or in the event a person other than a Participant,
Spouse, or Beneficiary receives an erroneous payment from the Plan, the Administrator
or Employer shall have the right, on behalf of the Plan, to recover the amount
of the excess or erroneous payment from the recipient.  To the extent permitted under applicable law,
the Administrator or Employer may, at its option, deduct the amount of such
excess or erroneous payment from any future benefits payable to the applicable
Participant, Spouse, or Beneficiary.

 

30

 

10.19                 Effect on Other
Benefits

 

Except as otherwise
specifically provided under the terms of any other employee benefit plan of the
Employer, a Participant’s participation in this Plan shall not affect the
benefits provided under such other employee benefit plan.

 

10.20                 Tax and Legal
Effects

 

The Employer, the
Administrator, and their representatives and delegates do not in any way
guarantee the tax treatment of benefits for any Participant, Spouse, or
Beneficiary, and the Employer, the Administrator, and their representatives and
delegates do not in any way guarantee or assume any responsibility or liability
for the legal, tax, or other implications or effects of the Plan.  In the event of any legal, tax, or other
change that may affect the Plan, the Employer may, in its sole discretion, take
any actions it deems necessary or desirable as a result of such change.

 

31

 

SECTION 11  THE ADMINISTRATOR

 

11.1                        Information
Required by Administrator

 

Each person entitled to
benefits under the Plan must file with the Administrator from time to time in
writing such person’s mailing address and each change of mailing address.  Any communication, statement, or notice
addressed to any person at the last address filed with the Administrator will
be binding upon such person for all purposes of the Plan.  Each person entitled to benefits under the
Plan also shall furnish the Administrator with such documents, evidence, data,
or information as the Administrator considers necessary or desirable for the
purposes of administering the Plan.  The
Employer shall furnish the Administrator with such data and information as the
Administrator may deem necessary or desirable in order to administer the
Plan.  The records of the Employer as to
an Employee’s or Participant’s period of employment or membership on the Board,
termination of employment or membership and the reason therefor, leave of
absence, reemployment, and Compensation will be conclusive on all persons
unless determined to the Administrator’s or Employer’s satisfaction to be
incorrect.

 

11.2                        Uniform
Application of Rules

 

The Administrator shall
administer the Plan on a reasonable basis. 
Any rules, procedures, or regulations established by the Administrator
shall be applied uniformly to all persons similarly situated.

 

11.3                        Review of
Benefit Determinations

 

Benefits will
be paid to Participants and their beneficiaries without the necessity of formal
claims.  Participants or their
beneficiaries, however, may make a written request to the Administrator for any
Plan benefits to which they may be entitled. 
Participants’ written request for Plan benefits will be considered a
claim for Plan benefits, and will be subject to a full and fair review.  If the claim is wholly or partially denied,
the Administrator will furnish the claimant with a written notice of this denial.  This written notice will be provided to the
claimant within 90 days after the receipt of the claim by the
Administrator.  If notice of the denial
of a claim is not furnished to the claimant in accordance with the above within
90 days, the claim will be deemed denied. 
The claimant will then be permitted to proceed to the review stage
described in the following paragraphs.

 

Upon the
denial of the claim for benefits, the claimant may file a claim for review, in
writing, with the Administrator.  The
claim for review must be filed no later than 60 days after the claimant has
received written notification of the denial of the claim for benefits or, if no
written denial of the claim was provided, no later than 60 days after the
deemed denial of the claim.  The claimant
may review all pertinent documents relating to the denial of the claim and
submit any issues and comments, in writing, to the Administrator.  If the claim is denied, the Administrator
must provide the claimant with written notice of this denial within 60 days
after the Administrator’s receipt of the claimant’s written claim for
review.  The Administrator’s decision on
the claim for review will be communicated to the claimant in writing and will
include specific references to the pertinent Plan provisions on which the
decision was based.  If 

 

32

 

the Administrator’s decision on review is not furnished to the claimant
within the time limitations described above, the claim will be deemed denied on
review.  If the claim for Plan benefits
is finally denied by the Administrator (or deemed denied), then the claimant
may bring suit in federal court.  The
claimant may not commence a suit in a court of law or equity for benefits under
the Plan until the Plan’s claim process and appeal rights have been exhausted
and the Plan benefits requested in that appeal have been denied in whole or in
part.  However, the claimant may only
bring a suit in court if it is filed within 90 days after the date of the final
denial of the claim by the Administrator.

 

With respect to claims for benefits payable
as a result of a Participant being determined to be disabled, the Administrator
will provide the claimant with notice of the status of his claim for disability
benefits under the Plan within a reasonable period of time after a complete
claim has been filed, but no later than 45 days after receipt of the claim for
benefits.  The Administrator may request
an additional 30-day extension if special circumstances warrant by notifying
the claimant of the extension before the expiration of the initial 45-day
period.  If a decision still cannot be
made within this 30-day extension period due to circumstances outside the Plan’s
control, the time period may be extended for an additional 30 days, in which
case the claimant will be notified before the expiration of the original 30-day
extension.

 

If the claimant has not
submitted sufficient information to the Administrator to process his disability
benefit claim, he will be notified of the incomplete claim and given 45 days to
submit additional information.  This will
extend the time in which the Administrator has to respond to the claim from the
date the notice of insufficient information is sent to the claimant until the
date the claimant responds to the request. 
If the claimant does not submit the requested missing information to the
Administrator within 45 days of the date of the request, the claim will be
denied.

 

If a disability benefit claim
is denied, the claimant will receive a notice which will include: (i) the
specific reasons for the denial, (ii) reference to the specific Plan
provisions upon which the decision is based, (iii) a description of any
additional information the claimant might be required to provide with an
explanation of why it is needed, and (iv) an explanation of the Plan’s
claims review and appeal procedures, and (v) a statement regarding the
claimant’s right to bring a civil action under Section 502(a) of
ERISA following a denial on appeal.

 

The claimant may appeal a
denial of a disability benefit claim by filing a written request with the
Administrator within 180 days of the claimant’s receipt of the initial denial
notice.  In connection with the appeal,
the claimant may request that the Plan provide him, free of charge, copies of
all documents, records and other information relevant to the claim.  The claimant may also submit written
comments, records, documents and other information relevant to his appeal,
whether or not such documents were submitted in connection with the initial
claim. The Administrator may consult with medical or vocational experts in
connection with deciding the claimant’s claim for benefits.

 

The Administrator will conduct
a full and fair review of the documents and evidence submitted and will
ordinarily render a decision on the disability benefit claim no later than 45 

 

33

 

days after receipt of the
request for review on appeal.  If there
are special circumstances, the decision will be made as soon as possible, but
not later than 90 days after receipt of the request for review on appeal.  If such an extension of time is needed, the
claimant will be notified in writing prior to the end of the first 45-day period.  The Administrator’s final written decision
will set forth: (i) the specific reasons for the decision, (ii) references
to the specific Plan provisions on which the decision is based, (iii) a
statement that the claimant is entitled to receive, upon request and free of
charge, access to and copies of all documents, records and other information
relevant to the benefit claim, and (iv) a statement regarding the claimant’s
right to bring a civil action under Section 502(a) of ERISA following
a denial on appeal.  The Administrator’s
decision made in good faith will be final and binding.

 

11.4                        Administrator’s
Decision Final

 

Benefits under the Plan will be
paid only if the Administrator decides in its sole discretion that a
Participant or Beneficiary (or other claimant) is entitled to them.  Subject to applicable law, any interpretation
of the provisions of the Plan and any decisions on any matter within the
discretion of the Administrator made by the Administrator or its delegate in
good faith shall be binding on all persons. 
A misstatement or other mistake of fact shall be corrected when it
becomes known and the Administrator shall make such adjustment on account
thereof as it considers equitable and practicable.

 

34

 

SECTION 12  AMENDMENT AND TERMINATION

 

While the Employer expects and
intends to continue the Plan, the Employer and the Administrator each reserve
the right to amend the Plan at any time and for any reason, including the right
to amend this Section 12 and the Plan termination rules herein;
provided, however, that each Participant will be entitled to the amount
credited to his Accounts immediately prior to such amendment.  The power to amend the Plan includes (without
limitation) the power to change the Plan provisions regarding eligibility,
contributions, notional investments, vesting, and distribution forms, and
timing of payments, including changes applicable to benefits accrued prior to
the effective date of any such amendment; provided, however, that amendments to
the Plan (other than amendments relating to Plan termination) shall not cause
the Plan to provide for acceleration of distributions in violation of Section 409A
of the Code and applicable regulations thereunder.

 

The Employer reserves the right
to terminate the Plan at any time and for any reason; provided, however, that
each Participant will be entitled to the amount credited to his Accounts
immediately prior to such termination (but such Accounts shall  not be adjusted for future notional income,
losses, expenses, appreciation and depreciation).

 

In the event that the Plan is
terminated pursuant to this Section 12, the balances in affected
Participants’ Accounts shall be distributed at the time and in the manner set
forth in Section 9.  Notwithstanding
the foregoing, the Employer and the Administrator reserve the right to make all
such distributions within the second twelve-month period commencing with the
date of termination of the Plan; provided, however, that no such distribution
will be made during the first twelve-month period following such date of Plan
termination other than those that would otherwise be payable under Section 9
absent the termination of the Plan.  In
the event of a Plan termination due to a Change in Control of the Employer,
distributions shall be made within 12 months of the date of the Change in
Control.

 

35Exhibit
10.20(b)

 

NONQUALIFIED SUPPLEMENTAL

 

DEFERRED COMPENSATION PLAN

 

ADOPTION AGREEMENT

 

 

NONQUALIFIED SUPPLEMENTAL

DEFERRED COMPENSATION PLAN

ADOPTION AGREEMENT

 

ADOPTION
OF PLAN  — [Select one]

 

o                                    Adoption - The undersigned                              (the
“Employer”) hereby adopts as a Nonqualified Deferred Compensation Plan for the
individuals identified in Item 5 herein the form of Plan known as the
Nonqualified Supplemental Deferred Compensation Plan.

 

o                                    Amendment of Previous
Nonqualified Deferred Compensation Plan —  With “Grandfathered” Amounts                    (the
“Employer”) previously has adopted a Nonqualified Deferred Compensation Plan,
known as the                           [enter name of previous plan], and
the execution of this Adoption Agreement constitutes an amendment to that Plan,
effective only for Deferrals, Contributions, earnings, gains, losses,
depreciation and appreciation vested and credited thereto or debited therefrom
on and after the Effective Date listed in Section 2 below, or, if
otherwise determined by the Employer, on and after January 1, 2005 with
respect to Plan provisions required under Section 409A of the Internal
Revenue Code and the regulations thereunder. All other amounts in the plan
shall be subject to the provisions of the previous plan document. This option
is appropriate if the previous plan contains grandfathered amounts not subject
to Section 409A of the Internal Revenue Code. Grandfathered amounts were
contributed to the plan prior to January 1, 2005 under the terms of the
plan in effect prior to October 4, 2004, and those plan terms have not
since been materially modified. Grandfathered amounts and earnings will be administered
under the terms of the prior plan document.

 

x                                  Restatement of Previous Nonqualified Deferred Compensation Plan — Affymetrix, Inc.
(the “Employer”) previously has adopted a Nonqualified Deferred Compensation
Plan, known as the Affymetrix, Inc.
Deferred Compensation Plan [enter name of previous
plan], and the execution of this Adoption Agreement constitutes
a restatement of that Plan, effective as of the Effective Date listed in Section 2
below for all funds under the Plan. This option is appropriate if the previous
plan does not contain “grandfathered” amounts (see description above), or if
Employer wishes to apply Section 409A rules to all amounts in the
plan (even pre-2005 amounts), or if previous plan has been materially modified
and thus become subject to Section 409A.

 

NAME OF PLAN

 

The name of this Plan as
adopted by the Employer is the  [enter name of Plan] Affymetrix, Inc.
Deferred Compensation Plan (the “Plan”).

 

INDIVIDUALIZED
PLAN INFORMATION

 

With
respect to the variable features contained in the Plan, the Employer hereby
makes the following selections granted under the provisions of the Plan:

 

1.                                       Adopting Entity. The Employer adopts the Plan as:

 

1

 

List type of business entity (corporation,
partnership, controlled group of corporations, etc.) Corporation

 

List each Employer adopting the
Plan and Employer Identification Number (EIN):

 

	
  Name of Employer:

  	
   

  	
  Affymetrix, Inc.

  	
   

  	
  EIN:

  	
   

  	
  77-0319159

  
	
  Name of Employer:

  	
   

  	
   

  	
   

  	
  EIN:

  	
   

  	
   

  
	
  Name of Employer:

  	
   

  	
   

  	
   

  	
  EIN:

  	
   

  	
   

  
	
  Name of Employer:

  	
   

  	
   

  	
   

  	
  EIN:

  	
   

  	
   

  
	
  Name of Employer:

  	
   

  	
   

  	
   

  	
  EIN:

  	
   

  	
   

  

(attach additional lists as
necessary)

 

The adopting Employers and the Employer are referred
to herein collectively as the “Employer.”

 

Select state of controlling law
(see Section 10.7 of Plan Document):

 

x                                  State of incorporation;   Delaware

 

o                                    State of domicile

 

2.                                       Effective Date. The “Effective Date” of the adoption of
this Plan, this Plan amendment or this Plan restatement is [enter
date] December 31, 2008.

 

3.                                       Plan Year. The “Plan year” of the Plan shall be [select one]:

 

x                                  the calendar year.

 

o                                    the fiscal year or other 12- month period
ending on the last day of [specify month].

 

o                                    a short Plan year beginning on    ,     and ending on 
  ,    ;
and thereafter the Plan year shall be as indicated in (a) or (b) above.

 

4.                                       Plan Administrator. The “Administrator” of the Plan is Senior
Director, Compensation, Benefits and HRIS.

 

 [fill in the name(s) of the individual(s) or
job title(s) or entity (such as a committee) that is (are) responsible for
administration of the Plan], and such other person(s) or
entity as the Employer shall appoint from time to time.

 

5.                                       Eligible Individuals. The following shall be eligible to
participate in the Plan:  [select all that apply – do not list individual
names]:

 

x                                  A select group of management or
highly-compensated Employees as designated by the Employer in separate
resolutions or agreements;

 

2

 

o                                    Employee Board Members;

 

x                                  Non-Employee Board Members;

 

o                                    Other Service Providers (i.e., independent
contractors, consultants, etc.)

 

o                                    Employees or other Service Providers above
the following Compensation threshold:  [enter dollar amount]  $      ;

 

o                                    Employees with the following job titles:  [enter job title(s); for
example, “Vice President and above”]

 

o                                    Other: [enter description]

 

6.                                       Eligibility Timing. Eligibility timing selected below shall apply
uniformly to all Participant Deferrals (including Performance-Based Bonus
Deferrals), as well as Employer Matching Contributions and Other Employer
Contributions, unless otherwise indicated. If the Employer wishes to provide
for separate eligibility rules for different types of Compensation (for
example, Salary vs. Bonus), or for types of Contributions (for example,
Employer Matching Contributions vs. Participant Deferrals), mark “Other” below
and attach exhibits as necessary  [select
one]:

 

x                                  Eligible immediately upon properly completed
designation by the Plan administrator or Employer;

 

o                                    Eligible after the following period of
employment, Board service, etc. [enter number of days,
months or years, for example, 90 days]      ;

 

o                                    Other  [enter description]:

 

7.                                       Types and Amounts of Participant
Deferrals [select all that apply and enter minimum and maximum
percentages in increments of one percent (for example, Salary minimum 0%
maximum 100%). Note that no Deferral election can reduce a Participant’s
Compensation below the amount necessary to satisfy required withholding for
FICA/Medicare/income taxes,  required
Participant Contributions into another Employer-sponsored benefit plan such as
medical insurance, 401(k) loan repayments, etc.]:

 

x                                  Salary [select one]:

 

x 
percentage [enter  minimum
0% and maximum 75%]

or

x  fixed
dollar amount  [enter
minimum $5000 annual minimum for all deferral sources ].

 

o                                    Non-Performance-Based Bonus [select one]:

 

o 
percentage [enter  minimum
     % and maximum       %]

or

 

3

 

o  fixed
dollar amount  [enter
minimum $    ].

 

x                                  Performance-Based Bonus [select
one and enter performance period (for example, 12-month period ending each March 31
]: performance period from
                
to
                              .

 

x 
percentage [enter  minimum
0% and maximum 90%]

or

x  fixed
dollar amount  [enter
minimum $5000 annual minimum for all deferral sources].

 

o                                    Commissions [select
one]:

 

o  percentage
[enter  minimum
  % and, maximum   %]

or

o  fixed
dollar amount  [enter
minimum $         ].

 

x                                  Board of Directors Fees/Retainer (note —
should not include expense reimbursements):

 

x 
percentage [enter  minimum
0% and, maximum 100%]

or

x  fixed
dollar amount  [enter
minimum $5000 annual minimum for all deferral sources].

 

o                                    Other Service Provider Fees or other earned
income from the Employer:

 

o 
percentage [enter  minimum
  % and, maximum   %]

or

o  fixed
dollar amount  [enter
minimum $  ].

 

o                                    401(k) Refund (amount
deferred from Participant’s regular Compensation equal in value to any refund
paid to Participant in that year resulting from excess deferrals in Employer’s
401(k) plan — see Subsection 2.9 of Plan document for definition.)

 

o                                    Other [enter description]:

 

8.                                       Definition of Compensation for
Purposes of Making Plan Contributions [select one]:

 

o                                    Same definition of Compensation as in
Employer’s 401(k) or other applicable qualified retirement plan, earned
while the Participant is an Eligible Individual, as determined by the Employer.

 

o                                    Participant’s total wages, salary,
commissions, overtime, bonus, etc. for a given year which the Employer is
required to report on Form W-2 or other appropriate form, (or, in the case
of Board members, Board fees and retainer only, but not including expense
reimbursements)(or, in the case of Other Service Providers,

 

4

 

the Participant’s total remuneration from the
Employer for a given year pursuant to the agreement to provide services to the
Employer), earned while the Participant is an Eligible Individual as determined
by the Employer.

 

x                                  Other [enter description]:  (a) Participant’s total annual cash
compensation relating to services performed during any calendar year, including
commissions, overtime, bonus, which the Employer is required to report on Form W-2
or other appropriate form, or, (b) in the case of Board members, Board
fees and retainer only, but not including expense reimbursements or, (c) in
the case of Other Service Providers, the Participant’s total remuneration from
the Employer for a given year pursuant to the agreement to provide services to
the Employer, earned, in each case, while the Participant is an Eligible
Individual as determined by the Employer, but in each case, excluding
distributions from nonqualified deferred compensation plans, fringe benefits,
stock options, relocation expenses, severance pay, automobile and other
allowances and non-monetary awards made to a Participant.

 

9.                                       Expiration of Participant’s
Deferral Elections [select all that apply]:

 

x                                  Renewed Each Year:  Participant’s Deferral Elections must be renewed each year during the
open enrollment period ending no later than December 31 prior to the
effective Plan year (or, in the case of Performance-Based Bonuses, no less than
6 months prior to the end of the applicable performance period).

 

x  For
all types of Compensation Deferrals.

 

o  For
Salary Deferrals only — other types of Deferrals are “evergreen”.

 

o  For
Performance-Based Bonus only — other types of Deferrals are “evergreen”.

 

o 
Other: [specify]

 

o                                    Evergreen:  Participant’s Deferral Elections will be “evergreen” (i.e., will continue
indefinitely until the Participant’s Termination Date unless changed by the
Participant — so each year the Participant will be deemed to have the same election
in place as the prior year unless actively changed by the Participant during
the open enrollment period ending no later than December 31 prior to the
effective Plan year or, in the case of Performance-Based Bonuses, no less than
6 months prior to the end of the applicable performance period).

 

o  For
all types of Compensation Deferrals.

 

o  For
Salary Deferrals only — other types of Deferrals are renewed each year.

 

o  For
Performance-Based Bonus only — other types of Deferrals are renewed each year.

 

o 
Other: [specify]

 

10.                                 Employer Contributions [select all that apply]:.

 

o                                    (a)                                  No Employer Contributions.

 

5

 

o                                    (b)                                 Matching Contributions on all Participant Compensation Deferrals [also complete Items 11 through 14  ].

 

o                                    (c)                                  Matching Contributions on certain types of
Compensation Deferrals (for example, Matching Contributions on Participant
Performance-Based Bonus Deferrals, etc.) [attach explanation describing
which types of deferrals will be matched and also complete Items 11 through 14]

 

x                                  (d)                                 Employer Contributions other than Matching
Contributions [complete Item 15]  (amount or formula for determining and
allocating such contributions should be documented in writing when determined,
and such writings will form part of the Plan).

 

11.                                 Amount of Matching Contribution
on Participant Compensation Deferrals. If the Employer has specified in Item 10(b) or (c) that it
will make Matching Contributions on behalf of Participants based on their
Compensation Deferrals, such Matching Contributions will be in an amount determined
as follows for the applicable period selected in Item 13 below:  [Select (a), (b), (c), (d) or
(e) below — if Employer has indicated in 10(c) above that Matching
Contributions will be made on certain types of Participant Compensation
Deferrals and if Employer wishes for 
different Matching formulas to be used for different types of
Participant Compensation Deferrals, Employer should attach additional copies of
this Item 11 completed for each type of Participant Compensation Deferral that
is matched. ]

 

	
  o

  	
   

  	
  (a)

  	
   

  	
         % of the Compensation
  Deferrals made by each Participant during the applicable period.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  (b)

  	
   

  	
  At a percentage determined from time to time in the discretion of the
  Employer of each Participant’s Compensation Deferrals for the applicable
  period (percentage should be documented in writing when determined, and such
  writings will form part of the plan).

  

 

[Optional:  If 11(a) or (b) above
is selected, the Employer may also specify here that it will not match
Compensation Deferrals in excess of   $   or   % of each Participant’s Compensation during
the applicable period —specify   either a dollar amount or a whole
percentage. If no limit is entered here, the assumption is that
100% of the Participant’s Compensation Deferrals will be matched at the
applicable percentage.]

 

	
  o

  	
   

  	
  (c)

  	
   

  	
          % of the portion of
  each Participant’s Compensation Deferral Contributions during the applicable
  period which does not exceed    % of the Participant’s Compensation
  for such period; plus    % of the portion, if any, of each
  Participant’s Compensation Deferral Contributions during the applicable
  period which exceeds    % but does not exceed   % of
  the Participant’s Compensation for such period.

   

  

 

[Note:  Example for 11(c) above
— select this option if Employer wants to match different percentages and
different levels of deferral — for example, 100% of the first 3% of
compensation deferred, and 50% of the next 2%]

 

6

 

	
  o

  	
   

  	
  (d)

  	
   

  	
           % of the
  Compensation of each Participant who made Compensation Deferral Contributions
  during the applicable period of at least   %
  of Compensation.

   

  
	
  o

  	
   

  	
  (e)

  	
   

  	
  Other:  [describe]

  

 

12.                                 Applicable Period for Matching
Contributions. Employer
Matching Contributions elected under Item 10(b) or (c) shall be
allocated and credited to eligible Participants’ Accounts as soon as
administratively feasible after the end of each “Applicable Period” after the
amounts have been determined by the Employer. For purposes of determining a
Participant’s share of Matching Contributions under Item 10, the Applicable
Period shall be  [Select
one]:

 

o                                    the Plan Year.

 

o                                    the payroll period.

 

o                                    other (specify calendar month, Plan year
quarter, etc.)      .

 

13.                                 Employees Eligible to Receive
Employer Matching Contributions. Matching Contributions made for each Plan Year (if applicable)  shall be allocated and credited to the
Accounts of the following Participants: [Select one if applicable]

 

o                                    Participants who were employed by the
Employer (or, in the case of non-Employee Board Members, served on the Board)
during that Plan Year, or, in the case of Other Service Providers, who provided
services to the Employer during that Plan Year.

 

o                                    Participants who were employed by the
Employer (or, in the case of non-Employee Board Members, served on the Board)
on the last day of the Plan Year, or, in the case of Other Service Providers,
who provided services to the Employer on the last day of the Plan Year.

 

o                                    Participants who were employed by the
Employer (or, in the case of non-Employee Board Members, served on the Board)
on the last day of the Plan Year or who retired, died or were Disabled during
the Plan Year, or, in the case of Other Service Providers, who provided
services to the Employer on the last day of the Plan Year or who died or were
Disabled during the Plan Year. [If this option is
selected, complete Item 30 — definition of “Disability”.]

 

14.                                 Vesting Schedule of Employer
Matching Contributions. If
Matching Contributions are made to the Plan, select the rate at which such
Contributions will vest [select one]:

 

o                                    Immediate 100% vesting for all Participants.

 

o                                    “Cliff” vesting (0%  up to cliff; 100% after cliff) [select one]:

 

o  1
year cliff (less than 1 year 0%; 1 or more years 100%)

 

o  2
year cliff (less than 2 years 0%; 2 or more years 100%)

 

7

 

o  Other
cliff (enter number of years:  less than    years 0%;    or more years 100%)

 

o                                    “Graded” vesting  [enter vesting percentages]:

 

1 year    %                                         6 years    %                                   11 years    %

 

2 years    %                                   7 years    %                                   12 years    %

 

3 years    %                                   8 years    %                                   13 years    %

 

4 years    %                                   9 years    %                                   14 years    %

 

5 years    %                                   10 years    %                             15 years    %

 

o                                    Other vesting schedule: [describe
schedule — subject to approval]

 

15.                                 Vesting Schedule of Employer
Contributions (Other Than Matching Contributions). If Employer Contributions (other than
Matching Contributions) are made to the Plan, select the rate at which such
Contributions will vest [select one]:

 

o                                    Immediate 100% vesting for all Participants.

 

o                                    “Cliff” vesting (0%  up to cliff; 100% after cliff) [select one]:

 

o  1
year cliff (less than 1 year 0%; 1 or more years 100%)

 

o  2
year cliff (less than 2 years 0%; 2 or more years 100%)

 

o  Other
cliff (enter number of years:  less than    years 0%;    or more years 100%)

 

o                                    “Graded” vesting  [enter vesting percentages]:

 

1 year    %                                         6 years    %                                   11 years    %

 

2 years    %                                   7 years    %                                   12 years    %

 

3 years    %                                   8 years    %                                   13 years    %

 

4 years    %                                   9 years    %                                   14 years    %

 

5 years    %                                   10 years    %                             15 years    %

 

x                                  Other vesting schedule: [describe
schedule — subject to approval] Employer Contribution shall
vest in accordance with the vesting schedule set forth in any agreement entered
into between the Participant and Employer. If not addressed in such agreements,
Employer Contribution shall vest in accordance with the schedule declared by a
committee responsible for the administration of the Plan.

 

16.                                 Vesting Years. A “Vesting Year” described above for
purposes of determining vesting under the Plan shall be computed in accordance
with:  [select
one — if this is an amendment or restatement of a prior plan, definition from
prior plan will override this definition.]

 

8

 

o                                    Years of service (12-consecutive-month periods)
with the Employer since date of hire (or date of commencement of Board service).

 

o                                    Years of participation in the Plan
(12-consecutive-month period between date Participant enters Plan and
anniversary of such date) (if this is an amendment or restatement of a prior
Plan, years of participation in prior plan will be included) (additional fees
will apply if this item is selected).

 

o                                    Plan Years since each Plan Year’s total
Contributions were made (“rolling vesting”) (additional fees will apply if this
item is selected). [If this option is selected, select either (a) or
(b) below:]

 

	
  o

  	
   

  	
  (a)

  	
   

  	
  Vesting will be credited/updated on the last day of the Plan year.

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  (b)

  	
   

  	
  Vesting will be credited/updated on the anniversary of the date the
  Contribution is credited.

  

 

17.                                 Full Vesting Upon Occurrence of
Specific Event. [select all that apply]

 

o                                    100% vesting upon Normal Retirement [describe criteria such as age (can be partial
year), years of service with the Employer (must be whole years of service), or
years of participation in the Plan (must be whole years of participation)]

 

o                                    100% vesting upon Early Retirement [describe criteria such as age (must be whole
years), years of service with the Employer (must be whole years of service), or
years of participation in the Plan (must be whole years of participation)]

 

x                                  100% vesting upon Death.

 

x                                  100% vesting upon Disability [complete Item 30 — definition of “Disability”].

 

x                                  100% vesting upon Change in Control of the
Employer [complete Items 28 and29 — definition of “Change
in Control”]

 

o                                    100% vesting upon occurrence of other
event:  [describe
event]

 

18.                                 Service Before Plan’s
Establishment Excluded. Years
of service earned prior to establishment of the Plan shall be disregarded for
purposes of determining vesting under the Plan:

 

o                                    Yes (this may be elected only if this is the
establishment of a new Plan).

 

x                                  No.

 

9

 

19.                                 Forfeitures for Misconduct or
Violation of Non-Compete.  Participants terminating employment prior to
becoming 100% vested will forfeit the forfeitable percentage of their Accounts
as indicated in accordance with the vesting schedule selected in Items 14
and/or 15.  Participants may also forfeit
100% of their Matching and Employer Contribution Accounts (if applicable) under
the following circumstances:  [select any that apply]:

 

o            Misconduct (termination for Cause). [if selected, the definition of Misconduct or Cause
should be documented in writing, and such writings will form part of the Plan]

 

o                                    Engaging in competition with the
Employer.  [if
selected, the definition of engaging in competition should be documented in
writing, and such writing will form part of the Plan]

 

20.                                 Employer Stock as Deemed Investment Option.  If Employer stock will be a deemed investment option, indicate below
how shares are to be tracked:  [select one]

 

o                                    Partial and whole shares.

 

o                                    Unitized fund.

 

21.                                 In-Service Distributions.  If
the Employer elects below, the Plan will allow distributions of Participant
Deferral Contributions to be made to Participants while they are still employed
(“In-Service Distributions”), if they elect a fixed distribution date during
the regular election period.    [Select one — note that In-Service Distributions
of Employer Contributions is not permitted]

 

x                                  No, In-Service Distributions will not be
permitted for contributions on or after January 1, 2009.

 

o                                    Yes, In-Service Distributions will be permitted.  [select one ].

 

o  For
All Participant Deferral Contributions

 

o  For
Participant Compensation Deferral Contributions (other than Performance-Based
Bonus) only.

 

o  For
Participant Performance-Based Bonus Deferral Contributions.

 

Please indicate the number of
years a Participant must defer payment(s) until  In-Service Distribution(s) may begin:

 

o  2
Years after the Calendar Year for which the deferral is effective

 

o          Years
after the Calendar Year for which the deferral is effective

 

Please indicate if separate In-Service Distribution
Dates are allowed for each Type of Participant Deferral selected in Item 7:

 

o  No
(single distribution date allowed per Plan Year)

 

10

 

o  Yes
(requires additional tracked sources per Plan Year)

 

[Note — if “Yes” is elected above and the Plan will
allow In-Service Distributions, please indicate if Participant will be
permitted to make a “pushback” subsequent election to defer the original
distribution date at least five years in accordance with Plan provisions (see
subsection 9.1 of Plan document — note that election must be made 12 months
prior to original distribution date and election will not take effect for 12
months)    o Yes   o No ]

 

22.                                 Unforeseeable Emergency  Distributions Dates.  If
the Employer elects below, the Plan will allow distributions to be made to
Participants while they are still employed if they meet the criteria for an
unforeseeable emergency financial hardship (“Unforeseeable Emergency Distributions”).  Both Participant Deferral Contributions and
Vested Employer Contributions can be distributed in the event of an eligible
Unforeseeable Emergency Distribution event. [Select
one]

 

o                                    No, Unforeseeable Emergency Distributions
will not be permitted.

 

x                                  Yes, Unforeseeable Emergency Distributions
will be permitted.  [select
one below].

 

x  For
active Participants only.

 

o  For
active Participants, terminated Participants and Beneficiaries.

 

23.                                 Form of Distributions (at
Termination of Employment or Death).  Distributions will be made to
Participants upon Termination of Employment with the Employer or Death of the
Participant as follows [select one]

 

o                                    Lump sum only.

 

x                                  Lump sum unless installments elected, but can
only receive installments if Participant meets the following criteria [select all that apply– if item not selected below,
then Participants in that category will receive lump sum only]:

 

o 
Retirement [describe criteria such as age (can be
partial year), years of service with the Employer (must be whole years of
service), or years of participation in the Plan (must be whole years of
participation)]

 

o  Early
Retirement [describe criteria such as age (must be
whole years), years of service with the Employer (must be whole years of
service), or years of participation in the Plan (must be whole years of
participation)]

 

x 
Termination (other than for Misconduct, Cause or Violation of
Non-Compete)

 

x          Lump
sum unless installments elected, and Participant may receive installments
regardless of reason for Termination of Employment.

 

11

 

[Note – if Installments are elected above, please
indicate if Participant will be permitted to make a subsequent election to
change the number of installments in accordance with Plan provisions (see
subsection 9.2 of Plan document)     o Yes   x No ]

 

24.          Distribution Upon Disability.  If the Employer selects below, the Plan will
allow distributions to be made to Participants upon Disability but while they
are still employed if they meet the criteria for Disability in Item 30
below.  The form of distribution will be
the same as for Termination of Employment.

 

o                                    No, distribution upon Disability will not be
permitted.

 

x                                  Yes, distributions upon Disability will be
permitted.  [complete
Item 30 – definition of “Disability”].

 

25.          Expiration of Participant’s Distribution Elections [select
one]:

 

o                                    Renewed Each Year:  Participant’s Distribution Election must be selected each year during
the open enrollment period for the following year’s contributions — if no new
election is made, that year’s contributions default to payment in the form of a
lump sum.

 

x                                  Evergreen:  Participant’s Distribution Election will be “evergreen” (i.e., will
continue indefinitely for each year’s contributions until the Participant’s
Termination Date unless changed by the Participant – so each year the
Participant will be deemed to have the same distribution election in place as
the prior year unless actively changed by the Participant at open enrollment,
and the change will only be applicable to future contributions).

 

26                                    Distributions Upon Change in
Control:  If Employer elects below, distributions will
be made to Participants upon Change in Control of the Employer (without a
termination of employment of the Participant), as follows [select
one, and complete Items 28 and 29 below (definition of “Change in Control”) ]

 

o                                    No, Distributions upon Change in Control will
not be permitted.

 

x                                  Yes, Distributions upon Change in Control
will be permitted, in a lump sum only.

 

o                                    Yes, Distributions upon Change in Control
will be permitted, in a lump sum or in installments as elected by the
Participant [complete Item 23].

 

27.                                 Length of Installments (if
Installment Distributions permitted in Item 23 and/or Item 26 above)  [indicate length below]:

 

Annual
installments over no fewer than 2 [enter minimum number of
years – must be at least 2]  and no more than 15 years at Participant’s
election [enter 

 

12

 

maximum number of years].

 

28.                                 “Change in Control” – Dates of Distribution.  Distributions upon a Change in Control shall occur upon the date that [select all that apply – see Subsection 9.9  of the Plan document for more details]:

 

x                                  A person or group acquires more than 50% of
the total fair market value or voting power of the stock of the corporation
(select definition of “corporation” in Item 29 below).

 

o                                    A person or group acquires ownership of stock
of the corporation with at least 35% of the total voting power of the corporation
(select definition of “corporation” in Item 29 below).

 

o                                    A person or group acquires assets from the
corporation having a total fair market value of at least 40% of the value of
all assets of the corporation immediately prior to such acquisition.  (select definition of “corporation” in Item
29 below).

 

x                                  A majority of the corporation’s board of
directors is replaced during any 12-month period by directors whose appointment
or election is not endorsed by a majority of the board as constituted prior to
the appointment or election (select definition of “corporation” in Item 29 below).

 

29.                                 “Change in Control” – Which
Corporation the Change Relates.  Distributions upon a Change in Control shall
be made only if the Change in Control relates to the corporation selected
below:  [select
all that apply]:

 

x                                  (a)           The
corporation for whom the Participant is performing services at the time of the
Change In Control event.

 

x                                  (b)           The
corporation liable for payments from the Plan to the Participant.

 

x                                  (c)           A
corporation that is a majority shareholder of a corporation described in (a) or
(b) above.

 

x                                  (d)           Any
corporation in the chain of corporations in which each corporation is a
majority shareholder of another corporation in the chain, ending in a corporation
described in (a) or (b) above.

 

30.                                 Definition of “Disability.” A Participant shall be considered “Disabled”
if [select one]:

 

x                            by reason of any medically determinable
physical or mental impairment which can be expected to result in death or can
be expected to last for a continuous period of at least 12 months, the
Participant is receiving income replacement benefits for at least 3 months
under accident and health plans of the Employer;

 

13

 

o                              the Participant is unable to engage in any
substantial gainful activity by reason of any medically determinable physical
or mental impairment that can be expected to result in death or can be expected
to last for a continuous period of not less than 12 months;

 

o                              the Participant is deemed to be totally
disabled by the Social Security Administration;

 

o                              the Participant is determined to be disabled
in accordance with a disability insurance program, provided that the definition
of disability under such disability insurance program complies with the requirements
of one of the three preceding definitions above.

 

31.                                 Distributions to “Key Employees” – Investment.  In order to comply with Internal Revenue Code Section 409A,
distributions to “key employees” (see subsection 9.3 of the Plan Document for
definition) of publicly traded companies made due to employment termination
cannot be made within 6 months of the employment termination date.  If distribution to a key employee must be
delayed to comply with this 6-month rule, indicate below how Account balances
of such a Participant will be invested during the period of delay [select one]:

 

o                                    Valued as of most recent Valuation Date and
held at the Employer without allocation of additional gains or losses after
such Valuation Date  until payment can be
made.

 

x                                  Remain invested as if termination date had
not occurred, then valued as of most recent Valuation Date and distributed.

 

32.                                QDRO Distributions.  The Employer may elect whether distributions from a Participant’s
Account shall be permitted upon receipt by the Plan Administrator of a
Qualified Domestic Relations Order relating to a marital dissolution or
separation that provides for payment of all or a portion of a Participant’s
Accounts to an alternate payee (spouse, former spouse, children, etc.).  [Indicate below whether
QDRO distributions will be permitted]:

 

o                                    No, QDRO Distributions will not be permitted.

 

x                                  Yes, QDRO Distributions will be permitted.

 

33.                                 Additional Survivor Death Benefit
from Life Insurance.  In the event that life insurance is utilized
as a funding vehicle for the Plan, the Employer may wish to provide additional
Survivor Benefit from the following options : 
[select one]

 

o                                    No additional Survivor Benefit offered, but
rather Participant’s vested Account balance.

 

o                                    Face value of life insurance policy of Participant,
if any.

 

o                                    Greater of (a) face value of life
insurance policy of Participant, if any, or (b) Participant’s vested Account
balance.

 

14

 

x                                  Other: [enter amount or formula] $300,000
– the employee must have elected to defer salary and/or bonus for the current
plan year in order to be eligible to receive the additional survivor death
benefit from life insurance.

 

34.           Payment of Plan Expenses.  Plan expenses may be paid as follows: [select one]

 

x                                  Directly by the Employer.

 

o                                    Deducted from the Participant accounts and
Plan’s trust or other custodial account (mutual fund plans only, if applicable).

 

35.           “De Minimis” Small Amount Cashouts. 
If selected by the
Employer, Participant account balances that do not exceed a certain threshold
amount will be automatically cashed out upon the Participant’s Termination of
Employment or Death, as provided below [select one]

 

x                                  Yes, amounts that do not exceed a threshold
dollar amount will automatically be cashed out [enter
dollar amount, not to exceed the IRS 402(g) limit  for a given year ($15,500 for 2007 and 2008)  [enter amount] $15,000

 

o                                    No, no “de minimis” small amounts will be
cashed out.

 

By
signing this Adoption Agreement, the Employer certifies that it has consulted
with legal counsel regarding the effects of the Plan, as applicable, on all
parties.  The Employer further certifies
that it has and will limit participation in the Plan to a select group of
management or highly compensated Employees, Board Members or Other Service
Providers, as determined by the Employer in consultation with legal
counsel.  The Employer further certifies
that it is the Employer’s sole responsibility to ensure that each Participant
with the right to direct deemed investments under the Plan that are based on
securities issued by the Employer or a member of its controlled group (as
defined in Code Section 414(b) and (c)) will receive a prospectus for
any such deemed investment option based on such Employer securities.

 

The
Employer is solely responsible for its compliance with applicable laws, including
Federal and state securities and other applicable laws.

 

Only those elections that
are completed shall be considered as provisions applicable to and forming a
part of the Plan.

 

This
Adoption Agreement may only be used in conjunction with the Plan document.  All selections in the Adoption Agreement
providing for customized or “other” plan provisions are subject to review for
administrative feasibility, and may be subject to additional fees.

 

Terms used in this Adoption
Agreement which are defined in the Plan document shall have the meaning given
them therein.

 

The Employer hereby
acknowledges that it is adopting this Nonqualified Supplemental Deferred
Compensation Plan.  Federal legislation
or other changes in the law relating to 

 

15

 

nonqualified deferred
compensation or other employee benefit plans may require that the Plan be
amended.

 

*      *      *

 

The undersigned duly
authorized owner, or officer of the Employer hereby executes the Plan on behalf
of the Employer.

 

Dated
this 6th day of November, 2008.

 

 

	
   

  	
  Affymetrix, Inc.

  
	
   

  	
   

  
	
   

  	
  By
  

  	
       /s/
  John C. Batty

  
	
   

  	
  Its
  

  	
       Chief
  Financial Officer

  

 

16

 

ADDENDUM
A

TRANSITION RULES UNDER 

CODE SECTION 409A

 

Complete
the following if Plan utilized any of the transition rules permitted under
Code Section 409A.  Check any that
apply.

 

o                                    Deferral Election Change Prior to
3/15/05.  [You may only elect this option
if you are completing this Adoption Agreement prior to 12/31/05].  Plan allowed Participants to elect, prior to March 15, 2005, to
make new elections with respect to amounts earned in 2005 relating to services
performed on or before December 31, 2005 (provided that such amounts were
not paid or payable to the Participant prior to the election).

 

o                                    Deferral Cancellation Prior to
12/31/05.  [You may only elect this option
if you are completing this Adoption Agreement prior to 12/31/05].  Plan allowed Participants to elect, prior to December 31, 2005, to
terminate participation in the Plan and/or to cancel one or more deferral
elections previously elected with respect to amounts payable in 2005.  Amounts subject to the termination or
cancellation were included in the Participant’s income in 2005 or, if later, in
the taxable year in which the amounts were earned and vested.

 

o                                    Change in Payment Elections or
Conditions prior to 12/31/06.  Plan allowed Participants to revoke prior
payment elections and make new payment elections with respect to amounts
subject to 409A on or before December 31, 2006.  However, Participants were not allowed to
change payment elections in 2006 with respect to payments the Participant would
otherwise receive in 2006, or to cause payments to be made in 2006.

 

17

 

ADDENDUM
B

DEFERRAL OF RESTRICTED STOCK UNITS

 

Complete
the following if Employer wishes to allow for deferral of restricted stock
units. Restricted stock units (RSUs) may be deferred into the Plan, but the
election must be made by the following deadline (check any that apply):.

 

o                                    The
end of the calendar year prior to the date of grant of the RSU.

 

o                                    12 months before the payment date of the RSU (vesting
date is treated as the payment date for these purposes), but the election will
not take effect for 12 months, and the subsequent payout date must be at least
five years later than the original payment date).  Indicate subsequent payout date: 
                                    .

 

o                                    Within
30 days of the date of grant (but only if the RSU is structured so that vesting
is contingent on the employee performing services for at least an additional 12
months).

 

o                                    Within
6 months of the payment (vesting) date, but only if the RSU is
performance-based under 409A, and only if the performance period must be at
least 12 months long and either:  (i) the
amount of the compensation cannot be reasonably ascertained at the time of the
election, or (ii) the performance requirement is still not substantially
certain to be met at the time of the election.

 

18

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