Document:

exv10w1

 

[Omnibus Form of Insider Letter Agreement]

Exhibit 10.1

                             , 2006

Santa Monica Media Corporation

9229 Sunset Boulevard, Suite 505

Los Angeles, California 90069

			
		 	                    Re: Initial Public Offering

Ladies and Gentlemen:

     This letter is being delivered to you in accordance with the Underwriting Agreement (the
“Underwriting Agreement”) entered into by and between Santa Monica Media Corporation, a Delaware
corporation (the “Company”), Citicorp Global Markets Inc., Deutsche Bank Securities Inc. and
Ladenburg Thalmann & Co. Inc. (the “Underwriters”), relating to an underwritten initial public
offering (the “IPO”) of the Company’s units (the “Units”), each comprised of one share of the
Company’s common stock, par value $0.001 per share (the “Common Stock”), and one warrant, which is
exercisable for one share of Common Stock (a “Warrant”). Certain capitalized terms used herein are
defined in paragraph 13 hereof.

     In order to induce the Company to enter into the Underwriting Agreement and to proceed with
the IPO, and in recognition of the benefit that such IPO will confer upon the undersigned as a
[beneficial holder of securities of the Company/stockholder of the Company], and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned hereby agrees with the Company as follows:

     1. If the Company solicits approval of its stockholders of a Business Combination, the
undersigned will vote all shares of Common Stock, including Insider Shares, Private Placement
Shares and IPO Shares, owned directly or indirectly by him or it in accordance with the majority of
the votes cast by the holders of the IPO Shares, and hereby waives any and all rights to convert
his or its Insider Shares and Private Placement Shares in connection with a Business Combination.

     2. (i) [In the event that the Company fails to consummate a Business Combination within
(a) 18 months from the effective date (“Effective Date”) of the registration statement relating to
the IPO (the “Registration Statement”), unless a letter of intent, agreement in principle or
definitive agreement has been executed with respect to a Business Combination within such 18 month
period, (“18-Month Execution Failure”) or (b) 24 months after the Effective Date, if a
letter of intent, agreement in principle or definitive agreement has been executed with respect to
a Business Combination within 18 months from the Effective Date but the Business Combination has
not been consummated within such 18 month period (“24-Month Transaction Failure”), the undersigned
will (1) within a reasonable time prior to the expiration of such 18 or 24 month period, as the
case may be, vote to adopt a specific plan of dissolution and liquidation to be included in a proxy
statement to seek stockholder approval for such plan of dissolution and liquidation in the event
that the Company fails to so consummate a Business Combination within such 18- or 24-month period,
as the case may be, and (2) take all reasonable actions within the undersigned’s power to cause to
be prepared a proxy statement that sets forth such plan of dissolution and liquidation and

 

 

recommends that the Company’s stockholders approve such plan.]1 In the event of an
18-Month Execution Failure or 24-Month Transaction Failure, as the case may be, the undersigned
will take all reasonable actions within the undersigned’s power to (x) cause the proxy statement
setting forth the specific plan of dissolution and liquidation approved by the Company’s board of
directors to be filed with the Securities and Exchange Commission (the “SEC”) as promptly as
possible after the expiration of the 18- or 24-month period, as the case may be, and (y)
cause a meeting of the Company’s stockholders to consider such plan of dissolution and liquidation
to be held (1) within 30 days following the passing of the deadline for SEC review of the proxy
statement, in the event the SEC does not review the proxy statement, and (2) promptly following the
conclusion of the comment and review process, in the event the SEC reviews the proxy statement.
The undersigned will vote all shares of Common Stock, including Insider Shares, Private Placement
Shares and IPO Shares, owned directly or indirectly by him or it in favor of such plan of
dissolution and liquidation.

     (ii) [In the event that the Company seeks approval from its stockholders for a Business
Combination within 90 days prior to the expiration of the foregoing 24-month period, the
undersigned will (a) vote to adopt a specific plan of dissolution and liquidation to be included in
the proxy statement seeking such stockholder approval of the Business Combination in the event that
the Company’s stockholders fail to so approve such Business Combination (“90-Day Business
Combination Approval Failure”) and (b) take all reasonable actions within the undersigned’s power
to cause to be prepared a proxy statement that sets forth such Business Combination and plan of
dissolution and liquidation and recommends that the Company’s stockholders approve such plan in the
event of a 90-day Business Combination Approval Failure.]2 In the event that the
Company seeks approval from its stockholders for a Business Combination within 90 days prior to the
expiration of the foregoing 24-month period, the undersigned will take all reasonable actions
within the undersigned’s power to (x) cause the proxy statement setting forth both the Business
Combination recommendation and the specific plan of dissolution and liquidation approved by the
Company’s board of directors to be filed with the SEC and (y) cause a meeting of the
Company’s stockholders to be held to consider such alternative recommendations.

     (iii) In the event the Company’s stockholders approve a plan of dissolution and liquidation in
connection with (a) an 18 Month Execution Failure or (b) a 24 Month Transaction Failure or (c) a
90-Day Business Combination Approval Failure (the date of the first such failure to occur being the
“Transaction Failure Date”), the undersigned will take all reasonable actions within the
undersigned’s power to (x) cause the Trust Fund to be liquidated and, after paying or reserving for
payment the Company’s liabilities, distributed to the holders of the IPO Shares as soon as
practicable and (y) cause the Company to dissolve and liquidate as soon as practicable (the
earliest date on which the conditions in clauses (x) and (y) are both satisfied being the
“Liquidation Date”). [In the event that the assets held outside the Trust Fund are insufficient to
pay the costs and expenses associated with the dissolution and liquidation of the Company, the
undersigned will indemnify and hold the Company harmless, jointly and severally with the other
officers of the Company (with right of contribution against such other officers), against any such
additional costs or expenses incurred by the Company in connection with the dissolution and
liquidation, excluding any special, indirect or consequential costs or expenses, such as litigation
pertaining to our dissolution and liquidation.]3 The undersigned hereby waives any and
all right, title, interest or claim of any kind in or to any distributions of the Trust Fund as a
result of such distribution, or to any other amounts distributed in connection with a liquidating
distribution of the Company with respect to the undersigned’s Insider Shares and the undersigned’s
Private Placement Shares (“Claim”) and hereby waives any Claim the undersigned may have in the
future as a result of, or arising out of, any contracts or agreements with the Company and will not
seek recourse against the Trust Fund for any reason whatsoever. The undersigned hereby agrees that
the Company shall be entitled to reimbursement from the undersigned for any distribution of the
Trust Fund, or any other amounts distributed by the Company in connection with a liquidating
distribution, received by the undersigned in respect of the undersigned’s Insider Shares and
Private Placement Shares.

     3. [Subsequent to the Transaction Failure Date, the undersigned agrees to indemnify and hold
harmless the Company, jointly and severally with the other officers
of the Company (with right of contribution from such other officers), against any and
all loss, liability, claims, damage and expense whatsoever (including, but not limited to, any and
all legal or other expenses reasonably incurred in investigating preparing or defending against any
litigation, whether pending or threatened, or any claim whatsoever) to which the Company may become
subject, prior to, on or after the Transaction Failure Date, as a result of (i) any claim by any vendor or other person who is owed money by the Company
for services rendered or products sold, or (ii) any claim by any acquisition target that the
Company did not pay or reimburse such target for the fees and expenses of third party providers of
services (such as accountants, consultants and attorneys) to the target that the Company agreed in
writing with the target to be liable for, in accordance with the terms of such agreement, but in
each case only to the extent (i) such vendor or prospective acquisition target failed to execute a
valid and enforceable waiver of rights or claims to the Trust Fund, and (ii) necessary to ensure
that such loss, liability, claim, damage or expense does not reduce the amount in the Trust Fund
(or, in the event that such claim arises after the distribution of the Trust Fund, to the extent
necessary to ensure that the Company’s

 

			
	1	 	This section of the agreement will appear
only in the agreements executed by the directors of the Company.
	 
	2	 	This section of the agreement will appear
only in the agreements executed by the directors of the Company.
	 
	3	 	This section of the agreement will appear
only in the agreements executed by the executive officers of the Company.

 

 

former stockholders, other than the officers of the Company, are not liable for any amount of
such loss, liability, claim, damage or expense).]2

     4. Intentionally deleted.

     5. The undersigned acknowledges and agrees that the Company will not consummate any Business
Combination which involves a company which is affiliated with any of the Insiders or their
respective affiliates unless the Company obtains an opinion from an independent investment banking
firm that the Business Combination is fair to the Company’s stockholders from a financial point of
view.

     6. Neither
the undersigned, any member of the family of the undersigned, nor any affiliate of the undersigned will be entitled to receive
and will not accept any compensation, including payments to related parties of the existing
stockholders, for performing due diligence or for services rendered to the Company prior to or in
connection with the consummation of the Business Combination, provided that Santa Monica
Capital Corp. (“Related Party”) shall be allowed to charge the Company $7,500 per month to
compensate it for the Company’s use of Related Party’s offices, utilities and personnel as
described in the Registration Statement. The undersigned shall be entitled to reimbursement from
the Company for his or its out-of-pocket expenses incurred in connection with seeking and
consummating a Business Combination.

     7. Neither the undersigned, any member of the family of the undersigned, nor any affiliate of
the undersigned will be entitled to receive, or accept, a finder’s fee or any other compensation
from the Company in the event the undersigned, any member of the family of the undersigned or any
affiliate of the undersigned originates a Business Combination.

     8. The undersigned shall not, and shall cause the members of such person’s immediate family
and the affiliates of such person to not, accept a finder’s fee or any other compensation in the
event the undersigned, any member of such person’s immediate family or any affiliate of such person
originates the initial Business Combination.

     9. Notwithstanding anything to the contrary herein, the undersigned may be paid consulting,
management or other fees (such as finder’s fees) from a target business, including those with whom
he has a relationship, either prior to or as a result of a Business Combination, with such amount,
to the extent then known, being fully disclosed to in the proxy materials furnished to the
stockholders of the Company in connection with the Business Combination.3

     10. The undersigned shall not (i) sell, offer to sell, contract or agree to sell, hypothecate,
pledge, grant any option to purchase or otherwise dispose of or agree to dispose of,

 

			
	2	 	 This section of the agreement will appear
only in the agreements executed by the officers of the Company.
	 
	3	 	This section applies only to advisers.

 

 

directly or indirectly, or, except as provided in that certain Registration Rights Agreement
dated as of the date hereof pertaining to the Units of the undersigned, file (or participate in the
filing of) a registration statement with the SEC in respect of, or establish or increase a put
equivalent position or liquidate or decrease a call equivalent position within the meaning of
Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the
SEC promulgated thereunder with respect to, any Units and the shares of Common Stock and Warrants
comprising the Units, the shares of Common Stock issuable upon exercise of the Warrants or any
securities convertible into or exercisable or exchangeable for shares of Common Stock or such
Warrants or other rights to purchase shares of Common Stock or any such securities, (ii) enter into
any swap or other arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of Units, shares of Common Stock or Warrants, the shares of Common Stock
issuable upon exercise of the Warrants or any securities convertible into or exercisable or
exchangeable for shares of Common Stock or such Warrants or other rights to purchase shares of
Common Stock or any such securities, whether any such transaction is to be settled by delivery of
shares of Common Stock or such other securities, in cash or otherwise, or (iii) publicly announce
an intention to effect any transaction specified in clause (i) or (ii) until (a) with respect to
his or its Insider Shares, the first anniversary of the Business Combination and (b) with respect
to its Private Placement Shares, upon a Business Combination (each, the “Lock-Up Period”).
Notwithstanding the foregoing, the undersigned may transfer his or its Insider Shares and his or
its Private Placement Shares during the applicable Lock-Up Period (i) by gift to a member of the
undersigned’s immediate family or to a trust, the beneficiary of which is a member of an
undersigned’s immediate family, an affiliate of the undersigned or to a charitable organization,
(ii) by virtue of the laws of descent and distribution upon death of the undersigned, (iii)
pursuant to a qualified domestic relations order, or (iv) in the event of a liquidation of the
Company prior to a Business Combination or the consummation of a liquidation, merger, stock
exchange or other similar transaction which results in all the Company’s stockholders having the
right to exchange their shares of Common Stock for cash, securities or other property subsequent to
the Company’s consummating a Business Combination with a target business; provided, however, that
the permissive transfers pursuant to clauses (i) — (iii) may be implemented only upon the
respective transferee’s written agreement to be bound by the terms and conditions of this
Agreement. During the applicable Lock-Up Period, the undersigned shall not grant a security
interest in his or its Insider Shares or Private Placement Shares.

     11. 4The undersigned agrees to be [President and Chief Executive
Officer, Treasurer and Director/Chairman of the Board of Directors/Member of the Advisory Board]
until the earlier of the consummation by the Company of a Business Combination or the Liquidation
Date. The undersigned’s biographical information furnished to the Company and the Underwriters and
attached hereto as Exhibit A is true and accurate in all respects, does not omit any material
information with respect to the undersigned’s background and contains all of the

 

			
	4	 	Not applicable to investors who are not
officers, directors, members of the Advisory Board or holders of more than 5%
of the equity of the Company.

 

 

information required to be disclosed pursuant to Section 401 of Regulation S-K, promulgated
under the Securities Act of 1933. The undersigned’s questionnaire furnished to the Company and the
Underwriters and attached hereto as Exhibit B is true and accurate in all respects. The
undersigned represents and warrants that:

          (a) the undersigned is not subject to or a respondent in any legal action for, any injunction,
cease-and-desist order or order or stipulation to desist or refrain from any act or practice
relating to the offering of securities in any jurisdiction;

          (b) the undersigned has never been convicted of or pleaded guilty to any crime (i) involving
any fraud or (ii) relating to any financial transaction or handling of funds of another person, or
(iii) pertaining to any dealings in any securities and the undersigned is not currently a defendant
in any such criminal proceeding; and

          (c) the undersigned has never been suspended or expelled from membership in any securities or
commodities exchange or association or had a securities or commodities license or registrations
denied, suspended or revoked.

     12. The undersigned has full right and power, without violating any agreement by which he or
it is bound (including, without limitation, any non-competition or non-solicitation agreement with
any employer or former employer), to enter into this letter agreement, [serve as [President and
Chief Executive Officer, Treasurer and as a member of the Board of Directors of the
Company/Chairman of the Board of Directors/Member of the Advisory Committee] and hereby consents to
being named in the registration statement as a[n] [officer] [director] [adviser] of the
Company.]5

     13. As used herein, (i) a “Business Combination” shall mean the initial acquisition of one or
more assets or operating businesses through a merger, capital stock exchange, asset or stock
acquisition or other similar business combination in the communications, media, gaming and/or
entertainment industries in connection with which the Company will require that a majority of the
shares of Common Stock voted by the public stockholders, as such term is used in the Registration
Statement, are voted in favor of the acquisition and less than 20% of the public stockholders both
exercise their conversion rights and vote against the proposed acquisition selected by the Company;
(ii) “Insiders” shall mean all officers, directors, advisers, beneficial owners and stockholders of
the Company immediately prior to the IPO; (iii) “Insider Shares” shall mean all of the shares of
Common Stock, and the Warrants underlying Units of the Company and all shares of Common Stock
issuable upon exercise of such Warrants owned directly or indirectly by an Insider prior to
                    , 2006 and any securities convertible into or exercisable or exchangeable for shares of
Common Stock or such Warrants or other rights to purchase shares of Common Stock or any such
securities; (iv) “IPO Shares” shall mean the shares of Common Stock underlying the Units issued in
the Company’s IPO; (v) “Private

 

			
	5	 	Not applicable to persons who are not
officers, directors, or members of the Advisory Board.

 

 

Placement Shares” shall mean the 375,000 shares of Common Stock and Warrants underlying the
375,000 Units that the Insiders have agreed to purchase in a private placement immediately prior to
the IPO, all shares of Common Stock issuable upon exercise of such Warrants and any securities
convertible into or exercisable or exchangeable for shares of Common Stock or such Warrants or
other rights to purchase shares of Common Stock or any such securities; and (vi) “Trust Fund” shall
mean the Trust Account established under that certain Investment Management Trust Agreement, dated
as of the date hereof, by and among the Company and Continental Stock Transfer & Trust Company.

     The undersigned acknowledges and understands that the Company will rely upon the agreements,
representations and warranties set forth herein in proceeding with the IPO. Nothing contained
herein shall be deemed to render the Underwriters a representative of, or a fiduciary with respect
to, the Company, its stockholders, or any creditor or vendor of the Company with respect to the
subject matter hereof.

     This letter agreement shall be binding on the undersigned and such person’s respective
successors, heirs, personal representatives and assigns. This letter agreement shall terminate on
the earlier of (i) the consummation of a Business Combination and (ii) the Liquidation Date;
provided that such termination shall not relieve the undersigned from liability for any breach of
this agreement prior to its termination, [and provided further
that the second sentence of Section 2(iii) and Section 3 of this agreement
shall survive a termination pursuant to clause (ii).]

     This letter agreement shall be governed by and interpreted and construed in accordance with
the laws of the State of New York applicable to contracts formed and to be performed entirely
within the State of New York, without regard to the conflicts of law provisions thereof to the
extent such principles or rules would require or permit the application of the laws of another
jurisdiction.

     No term or provision of this letter agreement may be amended, changed, waived, altered or
modified except by written instrument executed and delivered by the party against whom such
amendment, change, waiver, alteration or modification is to be enforced.

 

[Name of current stockholder]

Accepted and agreed:

SANTA MONICA MEDIA CORPORATION

			
	By:	 	
	 
	 	
	Name:	 	
	Title:	 	

 

 

Exhibit A

[Biographical Information Furnished to the Company and the Underwriters]

 

 

Exhibit B

[Questionnaires Furnished to the Company and the Underwriters]exv4w31

 

Exhibit 4.31

Savings and Profit Sharing Plan

For Employees of

First Interstate BancSystem, Inc.

2006 Restatement

	 	 	 	 	 	 	 
	Article I. The Plan
	 	 	 	 
	 
	 	 	 	 	 	 
	1.1

	 	Plan History and Effective Dates
	 	 	1	 
	1.2

	 	Purposes of the Plan
	 	 	1	 
	 
	 	 	 	 	 	 
	Article II. Definitions
	 	 	 	 
	 
	 	 	 	 	 	 
	2.1

	 	Definitions
	 	 	1	 
	2.2

	 	Gender and Number
	 	 	11	 
	 
	 	 	 	 	 	 
	Article III. Participation
	 	 	 	 
	 
	 	 	 	 	 	 
	3.1

	 	Date of Participation
	 	 	11	 
	3.2

	 	Eligibility Service
	 	 	11	 
	3.3

	 	Duration of Participation
	 	 	12	 
	3.4

	 	Reemployment
	 	 	12	 
	3.5

	 	Leased Employees
	 	 	12	 
	3.6

	 	Transferred Employees
	 	 	13	 
	 
	 	 	 	 	 	 
	Article IV. Contributions
	 	 	 	 
	 
	 	 	 	 	 	 
	4.1

	 	Employer Profit Sharing Contributions
	 	 	13	 
	4.2

	 	Allocation of Employer Profit Sharing Contributions
	 	 	13	 
	4.3

	 	Before-Tax and Matching Contributions
	 	 	14	 
	4.4

	 	After-Tax Contributions
	 	 	15	 
	4.5

	 	Contingency of Contributions on Profits
	 	 	16	 
	4.6

	 	Application of Forfeitures
	 	 	16	 
	4.7

	 	Limitation of Elective Deferrals
	 	 	16	 
	4.8

	 	Actual Deferral Percentage Test
	 	 	17	 
	4.9

	 	Adjustment to Actual Deferral Percentage Test
	 	 	20	 
	4.10

	 	Actual Contribution Percentage Test
	 	 	22	 

i

 

	 	 	 	 	 	 	 
	4.11

	 	Adjustment to Actual Contribution Percentage Test
	 	 	24	 
	4.12

	 	Limitations on Annual Account Additions
	 	 	26	 
	4.13

	 	Rollover Contributions
	 	 	28	 
	 
	 	 	 	 	 	 
	Article V. Vesting in Accounts
	 	 	 	 
	 
	 	 	 	 	 	 
	5.1

	 	After-Tax, Before-Tax and Rollover Contributions Accounts
	 	 	29	 
	5.2

	 	Employer Profit Sharing and Matching
Contributions Accounts
	 	 	29	 
	5.3

	 	Vesting Service
	 	 	30	 
	5.4

	 	Forfeiture of Nonvested Amounts
	 	 	31	 
	 
	 	 	 	 	 	 
	Article VI. Distributions and Withdrawals
	 	 	 	 
	 
	 	 	 	 	 	 
	6.1

	 	Distribution upon Retirement, Death, or Disability
	 	 	32	 
	6.2

	 	Distribution upon Termination of Employment for Reasons
other than Retirement, Death, or Disability
	 	 	33	 
	6.3

	 	Consent to Early Distributions
	 	 	34	 
	6.4

	 	Time of Distribution
	 	 	35	 
	6.5

	 	Required Minimum Distributions
	 	 	35	 
	6.6

	 	Withdrawals
	 	 	41	 
	6.7

	 	Loans
	 	 	44	 
	6.8

	 	Financial Hardship
	 	 	46	 
	6.9

	 	Eligible Rollover Distribution
	 	 	47	 
	 
	 	 	 	 	 	 
	Article VII. Investment Elections
	 	 	 	 
	 
	 	 	 	 	 	 
	7.1

	 	Investment of Accounts
	 	 	49	 
	7.2

	 	Model Portfolios
	 	 	49	 
	7.3

	 	Investment Elections
	 	 	49	 
	7.4

	 	Transfer of Assets
	 	 	50	 
	7.5

	 	Consequence of Investment Elections
	 	 	50	 
	7.6

	 	Distributions and Withdrawals
	 	 	50	 
	 
	 	 	 	 	 	 
	Article VIII. Company Stock
	 	 	 	 
	 
	 	 	 	 	 	 
	8.1

	 	An Investment Fund
	 	 	50	 
	8.2

	 	Purchase of Shares
	 	 	50	 
	8.3

	 	Valuing Stock
	 	 	51	 
	8.4

	 	Crediting of Stock to Account
	 	 	51	 
	8.5

	 	Dividends
	 	 	51	 

ii

 

	 	 	 	 	 	 	 
	8.6

	 	Transfers from Company Stock Investment Fund
	 	 	51	 
	8.7

	 	Distributions and Stock
	 	 	51	 
	8.8

	 	Withdrawals of Company Stock
	 	 	52	 
	8.9

	 	Loans and Stock
	 	 	52	 
	8.10

	 	Voting of Stock
	 	 	52	 
	8.11

	 	Tender Offers
	 	 	52	 
	 
	 	 	 	 	 	 
	Article IX. Accounts and Records of the Plan
	 	 	 	 
	 
	 	 	 	 	 	 
	9.1

	 	Accounts and Records
	 	 	53	 
	9.2

	 	Trust Fund
	 	 	53	 
	9.3

	 	Valuation and Allocation of Expenses
	 	 	53	 
	9.4

	 	Allocation of Earnings and Losses
	 	 	53	 
	 
	 	 	 	 	 	 
	Article X. Financing
	 	 	 	 
	 
	 	 	 	 	 	 
	10.1

	 	Financing
	 	 	53	 
	10.2

	 	Contributions
	 	 	54	 
	10.3

	 	Nonreversion
	 	 	54	 
	10.4

	 	Rights in the Trust Fund
	 	 	54	 
	 
	 	 	 	 	 	 
	Article XI. Committee and Administration
	 	 	 	 
	 
	 	 	 	 	 	 
	11.1

	 	Committee
	 	 	54	 
	11.2

	 	Organization
	 	 	54	 
	11.3

	 	Manner of Action
	 	 	54	 
	11.4

	 	Self-Interest
	 	 	55	 
	11.5

	 	Compensation and Expenses
	 	 	55	 
	11.6

	 	Powers
	 	 	55	 
	11.7

	 	Information
	 	 	55	 
	11.8

	 	Claim Procedure
	 	 	56	 
	11.9

	 	Notice of Address
	 	 	59	 
	11.10

	 	Application for Benefits and Data
	 	 	59	 
	11.11

	 	Indemnity for Liability
	 	 	60	 
	11.12

	 	Effect of a Mistake
	 	 	60	 
	11.13

	 	Missing Persons
	 	 	60	 
	11.14

	 	Appointment of Investment Manager
	 	 	60	 
	11.15

	 	Allocation of Fiduciary Responsibility
	 	 	60	 
	11.16

	 	Agency
	 	 	61	 

iii

 

	 	 	 	 	 	 	 
	Article XII. Amendment and Termination
	 	 	 	 
	 
	 	 	 	 	 	 
	12.1

	 	Amendment and Termination
	 	 	61	 
	12.2

	 	Limitations on Amendments
	 	 	62	 
	12.3

	 	Effect of Bankruptcy and Other Contingencies
Affecting the Employer
	 	 	62	 
	12.4

	 	Limitation on Employer Liability
	 	 	62	 
	12.5

	 	Amendment of Vesting Schedule
	 	 	62	 
	 
	 	 	 	 	 	 
	Article XIII. Miscellaneous
	 	 	 	 
	 
	 	 	 	 	 	 
	13.1

	 	Beneficiary Designation
	 	 	63	 
	13.2

	 	Incompetency
	 	 	64	 
	13.3

	 	Nonalienation
	 	 	65	 
	13.4

	 	Employment Rights
	 	 	65	 
	13.5

	 	Applicable Law
	 	 	65	 
	13.6

	 	Participation in the Plan by an Affiliate
	 	 	65	 
	13.7

	 	Merger, Consolidation, or Transfer
	 	 	65	 
	13.8

	 	Veterans’ Reemployment Rights
	 	 	66	 
	 
	 	 	 	 	 	 
	Article XIV. Top-Heavy Provisions
	 	 	 	 
	 
	 	 	 	 	 	 
	14.1

	 	Application of Top-Heavy Provisions
	 	 	66	 
	14.2

	 	Definitions
	 	 	66	 
	14.3

	 	Minimum Contribution
	 	 	68	 
	14.4

	 	Active Participant
	 	 	68	 

iv

 

Article I. The Plan

     1.1 Plan History and Effective Dates. First Interstate BancSystem, Inc., formerly
known as First Interstate BancSystem of Montana, Inc., formerly known as Security Banks of Montana
(the “Company”) heretofore established and maintained a savings plan, known as the “Savings Plan
for Employees of First Interstate BancSystem of Montana, Inc.” (the “Savings Plan”), for the
benefit of its eligible Employees, effective as of July 1, 1983. Said Savings Plan was thereafter
further amended and restated, effective as of January 1, 1987.

     Additionally, the Company heretofore established and maintained a profit sharing plan, known
as the “Profit Sharing Plan for Employees of First Interstate BancSystem of Montana, Inc.” (the
“Profit Sharing Plan”), for the benefit of its eligible Employees, effective as of January 1, 1983.
Said Profit Sharing Plan was thereafter further amended and restated, effective as of January 1,
1987.

     Effective as of January 1, 1991, the Profit Sharing Plan was merged into the Savings Plan and
the resulting plan was renamed the “Savings and Profit Sharing Plan for Employees of First
Interstate BancSystem of Montana, Inc.” (the “Plan”).

     Said Plan, as subsequently amended and renamed, has most recently been restated pursuant to
the “Savings and Profit Sharing Plan for Employees of First Interstate BancSystem, Inc. – 2002
Restatement,” effective as of January 1, 2002 and other dates specified therein, and was thereafter
amended pursuant to a “First Amendment to Savings and Profit Sharing Plan for Employees of First
Interstate BancSystem, Inc. – 2002 Restatement,” and a “Second Amendment to Savings and Profit
Sharing Plan for Employees of First Interstate BancSystem, Inc. – 2002 Restatement.” The Plan is
hereby further amended and restated as set forth herein effective as of January 1, 2006.

     1.2 Purposes of the Plan. The purposes of the Plan are to enable Participants to
share in the profitable operations of the Company and to provide a convenient way for Participants
to save on a regular and long-term basis for retirement.

Article II. Definitions

     2.1 Definitions. Whenever used in the Plan, the following terms shall have the
respective meanings set forth below unless otherwise expressly provided herein, and when the
defined meaning is intended the term is capitalized.

	 	(a)	 	“Account” means the separate account maintained for each Member
which represents his total proportionate interest in the Trust Fund as of any
Valuation Date and which consists of the sum of the following subaccounts:

	 	(1)	 	“After-Tax Contributions Account” means that portion
of such Member’s Account which evidences the value of

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	 	 	 	the After-Tax Contributions made by the Member prior to January
1, 1989, including the net worth of the Trust Fund attributable
thereto.
	 
	 	(2)	 	“Before-Tax Contributions Account” means that
portion of such Member’s Account which evidences the value of the
Before-Tax Contributions made on his behalf by an Employer, including
the net worth of the Trust Fund attributable thereto.
	 
	 	(3)	 	“Employer Profit Sharing Contributions Account”
means that portion of such Member’s Account which evidences the value
of the Employer Profit Sharing Contributions made on his behalf by an
Employer, including the net worth of the Trust Fund attributable
thereto.
	 
	 	(4)	 	“Matching Contributions Account” means that portion
of such Member’s Account which evidences the value of the Matching
Contributions made on his behalf by an Employer, including the net
worth of the Trust Fund attributable thereto.
	 
	 	(5)	 	“Rollover Contributions Account” means that portion
of such Member’s Account which evidences the value of a Member’s
Rollover Contributions made by the Member pursuant to section 4.13,
including the net worth of the Trust Fund attributable thereto.

	 	(b)	 	“Affiliate” means—

	 	(1)	 	any corporation other than the Company, i.e., either
a subsidiary corporation or an affiliated or associated corporation
of the Company, which together with the Company is a member of a
“controlled group” of corporations (as defined in section 414(b) of
the Code);
	 
	 	(2)	 	any organization which together with the Company is
under “common control” (as defined in section 414(c) of the Code);
	 
	 	(3)	 	any organization which together with the Company is
an “affiliated service group” (as defined in section 414(m) of the
Code); or
	 
	 	(4)	 	any other entity required to be aggregated with the
Company pursuant to Regulations under section 414(o) of
the Code.

2

 

	 	(c)	 	“After-Tax Contributions” means the voluntary contributions made by
a Member prior to January 1, 1989 as described in section 4.4.
	 
	 	(d)	 	“Before-Tax Contributions” means the contributions made by an
Employer on behalf of a Participant pursuant to his election to reduce his
Compensation as described in section 4.3(a).
	 
	 	(e)	 	“Beneficiary” means the person or persons designated by a Member
pursuant to section 13.1.
	 
	 	(f)	 	“Board” means the Board of Directors of the Company.
	 
	 	(g)	 	“Break in Service” means the cessation of crediting Hours of Service
when the Employee—

	 	(1)	 	resigns;
	 
	 	(2)	 	is discharged;
	 
	 	(3)	 	fails to report to work within the period required
under the law pertaining to veterans’ reemployment rights after the
Employee is released from military duty with the armed forces of the
United States, in which case the Employee’s Break in Service shall be
deemed to have occurred on the first day of the Employee’s authorized
leave of absence for such military duty;
	 
	 	(4)	 	is on an authorized leave of absence and fails to
return to employment, in which case the Employee’s Break in Service
shall be deemed to have occurred on the first day of the Employee’s
authorized leave of absence; or
	 
	 	(5)	 	retires or dies.

	 	(h)	 	“Code” means the Internal Revenue Code of 1986, as amended.
	 
	 	(i)	 	“Committee” means the committee described in section 11.1.
	 
	 	(j)	 	“Company” means First Interstate BancSystem, Inc. (formerly known as
“First Interstate BancSystem of Montana, Inc.” and previously “Security Banks
of Montana”), or any successor.
	 
	 	(k)	 	“Compensation” means a Participant’s pay, determined as follows:

3

 

	 	(1)	 	Plan Compensation. For all purposes of the
Plan, except as otherwise specified, Compensation means the base pay,
excluding bonuses, overtime, and incentive pay, actually received by
a Participant from an Employer during any Plan Year, and including
commission paid to mortgage and real estate personnel and brokers’
commissions received after June 30, 1999, all determined prior to any
election to reduce his Compensation under Code section 401(k) as
described in section 4.3(a) and determined prior to any salary
reductions under Code section 125 related to the First Interstate
BancSystem of Montana, Inc. Flexible Compensation Program, provided
however that an Employee’s Compensation for any period under this
paragraph (1) shall be limited in accordance with the Annual
Compensation Limit provided in paragraph (4) hereof. For purposes of
sections 4.2 and 4.3, only Compensation an individual receives while
a Participant shall be taken into account.
	 
	 	(2)	 	Section 414(s) Compensation. Section 414(s)
Compensation means an Employee’s compensation, as defined in section
415(c)(3) of the Code and the applicable Regulations plus, in Plan
Years ending before January 1, 1998 (i.e., before the following
amounts are included in the definition of “Section 415
Compensation”), elective contributions that are made by the Employer
on behalf of the Employee which are excludable from the Employee’s
income under Code section 125 or section 402(h).
	 
	 	 	 	For purposes of sections 4.8, 4.9, 4.10 and 4.11, the Company may
elect to use the definition of Section 415 Compensation under
paragraph (3) below or any alternative definition permitted under
Regulations in lieu of this definition.
	 
	 	 	 	An Employee’s Section 414(s) Compensation for any period shall be
limited in accordance with the Annual Compensation Limit provided
in paragraph (4) hereof.
	 
	 	(3)	 	Section 415 Compensation. For purposes of
applying the limits of section 415 of the Code, as described in
section 4.12, Compensation means an Employee’s compensation as
defined in section 415(c)(3) of the Code and the applicable
Regulations thereunder including, in Plan Years ending after December
31, 1997, elective contributions that are made by the Employer on
behalf of

4

 

	 	 	 	the Employee which are excludable from the Employee’s income
under Code section 125 or section 402(h). For Plan Years
beginning on and after January 1, 2001, Section 415 Compensation
paid or made available during such years shall include elective
amounts that are not includible in the gross income of the
Employee by reason of Code Section 132(f)(4).
	 
	 	(4)	 	Annual Compensation Limit. For Plan Years
beginning on or after January 1, 1994 and prior to January 1, 2002,
the Annual Compensation of each Employee taken into account under the
Plan shall not exceed the OBRA ‘93 annual compensation limit. The
OBRA ‘93 Annual Compensation limit is $150,000, as adjusted by the
Secretary of the Treasury for increases in the cost of living in
accordance with section 401(a)(17)(B) of the Code. The Annual
Compensation of each Participant taken into account in determining
allocations for any Plan Year beginning after December 31, 2001,
shall not exceed $200,000, as adjusted for cost-of-living increases
in accordance with section 401(a)(17)(B) of the Code. Annual
Compensation means Compensation, as defined in paragraphs (1) and (2)
hereof, during the Plan Year or such other consecutive 12-month
period over which Compensation is otherwise determined under the plan
(the “Determination Period”). The cost-of-living adjustment in effect
for a calendar year applies to annual Compensation for the
Determination Period that begins with or within such calendar year.

	 	(l)	 	“Disability” means a physical or mental injury or disease which
causes an Employee to be permanently incapable of rendering satisfactory
service to an Employer, as determined by the Plan Administrator under rules
consistently and uniformly applied to all Employees.
	 
	 	(m)	 	“Distribution Date” means a date as of which a Member’s Account may
be distributed, or commence to be distributed, to him. The business day
coinciding with or next following the fifteenth day of each calendar month
shall be a distribution date.
	 
	 	(n)	 	“Effective Date” means July 1, 1983, as to the Company, and also
means the date, if other than July 1, 1983, as of which the Plan is made
effective as to any other Employer.
	 
	 	(o)	 	“Eligibility Service” means the Service described in section 3.2.

5

 

	 	(p)	 	“Employee” means any person who is employed by the Company or
another Employer which has adopted the Plan.
	 
	 	(q)	 	“Employer” means the Company and any Affiliate which adopts the Plan
pursuant to section 13.6.
	 
	 	(r)	 	“Employer Profit Sharing Contributions” means the contributions made
by an Employer on behalf of a Participant as described in section 4.1.
	 
	 	(s)	 	“Employment Commencement Date” means the first day on which an
Employee first performs an Hour of Service for the Company or an Affiliate,
or, if applicable, the first day following a Break in Service or a Severance
from Service, on which an Employee performs an Hour of Service for the
Company or an Affiliate.
	 
	 	(t)	 	“ERISA” means the Employee Retirement Income Security Act of 1974,
as amended.
	 
	 	(u)	 	“Excess Before-Tax Contributions” means, with respect to a Plan
Year, the excess of Before-Tax Contributions made on behalf of Highly
Compensated Participants for the Plan Year over the maximum amount of such
contributions permitted under section 4.8. Excess Before-Tax Contributions
shall be treated as Annual Additions pursuant to section 4.12.
	 
	 	(v)	 	“Excess Elective Deferrals” has the meaning set forth in Section
4.7.
	 
	 	(w)	 	“Excess Matching Contributions” means, with respect to a Plan Year,
the excess of Matching Contributions made on behalf of Highly Compensated
Participants for the Plan Year over the maximum amount of such contributions
permitted under section 4.10. Excess Matching Contributions shall be treated
as Annual Additions pursuant to section 4.12.
	 
	 	(x)	 	“Forfeitures” means those portions of Accounts which are forfeited
as described in sections 5.4 and 11.13.
	 
	 	(y)	 	“Highly Compensated Employee” means, an Employee who performed
services for the Employer during the Determination Year and is in one or more
of the following groups:

	 	(1)	 	was a Five Percent Owner of the Employer at any time
during the Determination Year or Look-Back Year. “Five Percent
Owner” means any person who owns (or is

6

 

	 	 	 	considered as owning within the meaning of Code section 318) more
than five percent of the outstanding stock of the Employer or
stock possessing more than five percent of the total combined
voting power of all stock of the Employer or, in the case of an
unincorporated business, any person who owns more than five
percent of the capital or profits interest in the Employer. In
determining percentage ownership hereunder, Employers that would
otherwise be aggregated under Code sections 414(b), (c), (m) and
(o) shall be treated as separate Employers; or
	 
	 	(2)	 	received Section 415 Compensation during the
Look-Back Year from the Employer in excess of $80,000;

The “Determination Year” shall be the Plan Year for which testing is being
performed, and the “Look-Back Year” shall be the immediately preceding
twelve-month period.

For purposes of this section, the determination of Section 415
Compensation shall be based only on Section 415 Compensation which is
actually paid, and for Plan Years beginning before January 1, 1998 shall
be made without regard to Code sections 125, 402(e)(3), 402(h)(1)(B) and,
in the case of Employer contributions made pursuant to a salary reduction
agreement, without regard to Code section 403(b). Additionally, the
dollar threshold amount specified in subsection (2) shall be adjusted at
such time and in such manner as is provided in Regulations. In the case
of such an adjustment, the dollar limit which shall be applied is that for
the calendar year in which the Look-Back Year begins.

In determining who is a Highly Compensated Employee, all Affiliates shall
be taken into account as a single Employer and leased employees within the
meaning of Code sections 414(n)(2) and 414(o)(2) shall be considered
Employees unless such leased employees are covered by a plan described in
Code section 414(n)(5) and are not covered in any qualified plan
maintained by the Employer.

A Highly Compensated Employee shall include a former employee who
separated from service prior to the Plan Year and who was an active Highly
Compensated Employee for either (i) the year the employee separated from
service, or (ii) any Plan Year ending on or after the employee’s
fifty-fifth birthday.

	 	(z)	 	“Highly Compensated Participant” means any Highly Compensated
Employee who is eligible to participate in the Plan.

7

 

	 	(aa)	 	“Hour of Service” means—

	 	(1)	 	Each hour for which an Employee is directly or
indirectly paid, or entitled to payment, by the Company or an
Affiliate for—

	 	(A)	 	the performance of duties; or
	 
	 	(B)	 	the nonperformance of duties,
including, but not limited to, vacation, holidays, sickness,
disability, layoff, and similar paid periods of nonworking
time; provided, however, no such Hours of Service shall be
credited if a payment is made or due under a plan maintained
solely to comply with applicable worker’s compensation,
unemployment compensation, or disability insurance laws, or
if a payment solely reimburses an Employee for medically
related expenses incurred by such Employee;

	 	(2)	 	Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by the Company
or an Affiliate, with no duplication of credit for hours.

The Plan Administrator shall determine Hours of Service in accordance with
reasonable standards and policies adopted by it and shall credit Hours of
Service in accordance with Department of Labor regulation section
2530.200b-2.

	 	(bb)	 	“Income” means, for purposes of determining the amount of any corrective
distribution under Section 4.7, 4.9 or 4.11, the sum of the gain or loss for the
taxable year of the individual which is allocable to Excess Elective Deferrals, Excess
Before-Tax Contributions and Excess Matching Contributions as applicable, and not
including the allocable gain or loss for the period between the end of the taxable
year and the date of distribution.
	 
	 	(cc)	 	“Investment Fund” means any investment fund established by the Plan
Administrator as an investment medium for the Trust Fund, including, effective January
1, 1995 or as soon as practicable thereafter, the stock fund described in Article
VIII. The Plan Administrator shall have the discretion to establish and terminate such
funds as it shall deem appropriate; and also to determine such restrictions on the
investment of the Account (or any portion thereof) in any investment fund as it shall
deem appropriate, provided that any such restriction shall be applied in a uniform and
nondiscriminatory manner.

8

 

	 	(dd)	 	“Matching Contributions” means the contributions made by an Employer
on behalf of a Participant, conditioned on the making of Before-Tax
Contributions, as described in section 4.3(b).
	 
	 	(ee)	 	“Member” means a Participant, or a former Participant who still has
a balance in his Account.
	 
	 	(ff)	 	“Non-Highly Compensated Participant” means any Participant who is
not a Highly Compensated Employee.
	 
	 	(gg)	 	“One-Year Break in Service” means a Plan Year during which an
Employee who has had a Break in Service does not have more than 500 Hours of
Service. Solely for purposes of determining whether an Employee has incurred
a One-Year Break in Service, an Employee who is absent from work for reasons
of maternity or paternity leave shall be credited with the number of Hours of
Service (not in excess of 501) equal to—

	 	(1)	 	the number of Hours of Service which otherwise would
normally have been credited to such Employee for such absence, or
	 
	 	(2)	 	in any case in which the number of Hours of Service
described in paragraph (1) cannot be determined, eight Hours of
Service per each day of such absence.

An absence for maternity or paternity reasons means an absence by reason
of the pregnancy of the Employee, by reason of the birth of a child of the
Employee, by reason of placement of a child with the Employee in
connection with the adoption of such child by the Employee, or for
purposes of caring for such child for a period immediately following such
birth or placement. Effective as of August 5, 1993, the foregoing
definition shall also apply to an absence from employment, not to exceed
12 weeks, for which an Employee is entitled to leave under section 102(a)
of the Family and Medical Leave Act of 1993 for maternity or paternity
reasons stated above or—

	 	(A)	 	for purposes of caring for a spouse, child, or
parent (but not parent-in-law) who has a serious health condition, or
	 
	 	(B)	 	because of the Employee’s own serious health
condition.

The Hours of Service described in this section shall be credited only in
the employment year (or Plan Year, if applicable) in which the absence
from work begins if the Employee would be prevented from incurring a
One-Year Break in Service in such year solely

9

 

because of this section or, in any other case, in the immediately
following employment year (or Plan Year, if applicable).

	 	(hh)	 	“Participant” means any Employee who meets the eligibility
requirements to become a Participant as set forth in section 3.1.
	 
	 	(ii)	 	“Plan” means the Savings and Profit Sharing Plan for Employees of
First Interstate BancSystem, Inc. as set forth herein and as amended from
time to time.
	 
	 	(jj)	 	“Plan Administrator” means the entity which has been designated as
the “plan administrator” as provided in Article XI.
	 
	 	(kk)	 	“Plan Year” means the calendar year beginning each January 1.
	 
	 	(ll)	 	“Regulation” means the Income Tax Regulations as promulgated by the
Secretary of the Treasury or his delegate, and as amended from time to time.
	 
	 	(mm)	 	“Retirement Age” means the date a Participant attains his
fifty-fifth birthday.
	 
	 	(nn)	 	“Rollover Contribution” means those contributions made by an
Employee as described in section 4.13.
	 
	 	(oo)	 	“Section 414(s) Compensation” means Compensation as defined in
section 2.1(k)(2).
	 
	 	(pp)	 	“Section 415 Compensation” means Compensation as defined in section
2.1(k)(3).
	 
	 	(qq)	 	“Service” means employment with an Employer, an Affiliate, or a
predecessor thereof.
	 
	 	(rr)	 	“Trust Agreement” means any agreement establishing a trust, which
forms part of the Plan, to receive, hold, invest, and dispose of the Trust
Fund.
	 
	 	(ss)	 	“Trustee” means the corporation, or individual or individuals, or
combination thereof, acting as trustee under the Trust Agreement at any time
of reference.
	 
	 	(tt)	 	“Trust Fund” means the assets of every kind and description held
under the Trust Agreement.
	 
	 	(uu)	 	“Valuation Date” means the last business day of each calendar
quarter, and such other date or dates as the Plan Administrator shall declare
as a Valuation Date for the Plan or for any Account,

10

 

	 	 	 	category of Accounts, Investment Fund, or shares of Company stock. With
respect to each Investment Fund other than the Company stock Investment
Fund, each business day during the Plan Year shall be a Valuation Date.
	 
	 	(vv)	 	“Vesting Service” means Service credited for vesting purposes in
accordance with section 5.3.

     2.2 Gender and Number. The masculine pronoun whenever used shall include the
feminine and neuter pronoun, and the singular shall include the plural where the context requires
it.

Article III. Participation

     3.1 Date of Participation. Each Employee who was a Participant on December 31, 2001
shall continue to be a Participant in this Plan. Each other Employee shall become a Participant on
the first day of the month next following the date the Employee is classified as a regular status
(non-temporary) Employee and has begun working a regular schedule of at least 20 hours per week for
an Employer, or if sooner, the first January 1 or July 1 next following the completion of one year
of Eligibility Service.

     An Employee shall be eligible to make a Rollover Contribution before becoming a Participant;
provided, however, he shall be deemed a Participant to the extent of the Employee’s Rollover
Contribution only and not for any other purposes until the Employee otherwise is eligible to be and
becomes a Participant for all purposes hereunder.

     3.2 Eligibility Service. An Employee shall receive credit for one year of
Eligibility Service upon the first to occur of (a) or (b) below:

	 	(a)	 	the completion of his initial 12-month period of employment with the
Company and/or one or more Affiliates, provided he has completed at least
1,000 Hours of Service during such 12-month period; or
	 
	 	(b)	 	the completion of any Plan Year beginning after his Employment
Commencement Date during which he has completed at least 1,000 Hours of
Service for the Company and/or one or more Affiliates.

     In the case of Employees who were employed by First Citizens Bank of Bozeman, Montana on
January 1, 1995, Eligibility Service shall include Hours of Service performed for First Citizens
Bank of Bozeman, Montana prior to the time it became an Affiliate. In the case of Employees who
were employed by First National Park Bank, N.A. on July 1, 1995, Eligibility Service shall include
Hours of Service performed for First National Park Bank, N.A. prior to the time it became an
Affiliate. In the case of Employees who were employed in either the Helena, Montana or Belgrade,
Montana branch of the First

11

 

National Bank of Montana on the date on which substantially all the operating assets of such
branch were acquired by Company or an Affiliate, Eligibility Service shall include Hours of Service
performed for First National Bank of Montana prior to such date.

     For purposes of determining the Eligibility Service of an individual who is an employee of
First Interstate Bank of Wyoming, N.A., First Interstate Bank of Montana, N.A., Mountain Bank,
Security State Bank Shares, Security State Bank and Trust Company, Equality State Bank, Equality
Bankshares and Subsidiaries,or United States National Bank of Red Lodge on the date such
organization first becomes an Affiliate, service previously completed by the individual as an
employee of such organization (including service for any affiliated or predecessor entity taken
into account for eligibility purposes in a qualified pension or profit sharing plan maintained by
such organization) shall be taken into account to the same extent as service completed for an
Employer.

     In the case of an individuals who was an employee of Iowa State Bank and Trust immediately
prior to becoming an Employee on January 1, 2006, service previously completed by the individual as
an employee of Iowa State Bank and Trust shall be taken into account as of January 1, 2006 to the
same extent as service completed for an Employer, both for purposes of crediting years of
Eligibility Service and for purposes of determining whether the individual has begun working a
regular schedule of at least 20 hours per week for an Employer.

     3.3 Duration of Participation. Participant shall continue to be a Participant until
he terminates his employment with all Employers; thereafter, he shall be a Member for as long as he
has an Account.

     3.4 Reemployment. A former Participant shall again become a Participant immediately
upon resuming employment with an Employer. A former Employee who had a termination of employment
and was not a Participant at such termination of employment shall, upon resuming employment as an
Employee, receive credit for the Hours of Service he had prior to such termination of employment
for purposes of determining his eligibility to become a Participant, and such a former Employee who
had completed one year of Eligibility Service prior to his termination of employment but had not
yet become a Participant in the Plan by reason of his termination before the next occurring January
1, April 1, July 1, or October 1 shall, upon resuming employment as an Employee after such date,
immediately participate in the Plan.

     3.5 Leased Employees. A person who is not an Employee of an Employer or
nonparticipating Affiliate and who performs services for an Employer or a nonparticipating
Affiliate, hereinafter referred to as the “Recipient,” shall be considered a “leased employee” if:

	 	(a)	 	such services are provided pursuant to an agreement between the
Recipient and any other person, corporation or other entity;
	 
	 	(b)	 	such person has performed such services for the Recipient and/or one
or more “related persons” within the meaning of Code section

12

 

	 	 	 	144(a)(3) on a substantially full-time basis for a period of at least one
year; and
	 
	 	(c)	 	such services are performed under primary direction or control by
the Recipient.

     A person who is considered a “leased employee” of the Employer or nonparticipating Affiliate
shall not be considered an Employee for purposes of the Plan. However, if such a person
participates in the Plan as a result of subsequent employment with the Company or participating
Affiliate, he shall receive Eligibility Service and Vesting Service for his period of employment as
a leased employee.

     3.6 Transferred Employees. An Employee who is transferred from an Affiliate into
employment where he becomes a Participant hereunder shall be credited with Eligibility Service and
Vesting Service for all of his employment with the Company and the Affiliate, before and after such
transfer. Such Service shall be credited in accordance with this Article III and Article V.

Article IV. Contributions

     4.1 Employer Profit Sharing Contributions. For the Plan Year, the Employer shall
make an Employer Profit Sharing Contribution to the Plan in such amount (which may be zero) as the
Board shall determine by resolution, either specifying a fixed amount or specifying a definite
basis or formula by which a fixed amount can be determined, and Participants shall be notified of
said fixed amount or basis or formula by any form of communication the Employer considers
convenient. The Employer Profit Sharing Contribution shall be paid to the Trustee not later than
the time prescribed by law for obtaining a federal income tax deduction for such contribution.

     In no event shall an Employer make an Employer Profit Sharing Contribution for any Plan Year
which, when added to Before-Tax and Matching Contributions for such Plan Year, is greater than the
maximum amount deductible from income under the applicable provisions of the Code.

     4.2 Allocation of Employer Profit Sharing Contributions. The Employer Profit Sharing
Contributions for each Plan Year shall be allocated and credited as of the last day of each Plan
Year quarter for which the Employer Profit Sharing Contribution was made to Employer Profit Sharing
Contributions Accounts of Members who are in the employ of the Employer as of that date or who are
Members who retired, died, or incurred a Disability during the Plan Year quarter, in the proportion
of the Compensation of each such Member for that Plan Year quarter bears to the total of the
Compensation of all such Members for that Plan Year quarter. Only Compensation an individual
receives during a calendar quarter in which the individual is a Participant shall be taken into
account under this section.

13

 

     4.3 Before-Tax and Matching Contributions. For each Plan Year, each Employer shall
contribute an amount equal to the sum of (a) Before-Tax Contributions and (b) Matching
Contributions; the amount of each of which is as follows:

	 	(a)	 	Before-Tax Contributions. Each Participant may elect, on a form
provided by the Plan Administrator, to reduce his Compensation by whole
number percentage (not to exceed 15 percent in Plan Years beginning before
January 1, 2002) and to have the amount by which his Compensation is reduced
contributed on his behalf by his Employer as a Before-Tax Contribution to the
Plan.
	 
	 	 	 	In the case of a Participant who first becomes an Employee after December
31, 2000, and any Participant who first becomes an Employee during the
Plan Year ended December 31, 2000 and makes the election provided in the
last sentence of section 5.2(a), if the individual does not affirmatively
elect to either (1) reduce his Compensation by a specified amount to be
contributed to the Plan in accordance with the preceding paragraph, or (2)
not reduce his Compensation in accordance with the preceding paragraph,
then his or her Compensation shall be automatically reduced by 1 percent
and this amount shall be contributed on his behalf by his Employer as a
Before-Tax Contribution to the Plan. In the case of an Employee who
begins participating in the Plan after March 31, 2005, including a
reemployed Employee who resumes participation in the Plan after such date,
4 percent shall be substituted for 1 percent in the preceding sentence.
	 
	 	 	 	Within a reasonable time after an Employee described in the preceding
paragraph is hired, and before the date the Employee becomes a
Participant, the Employer shall provide the Employee with a notice that
explains the automatic Compensation reduction election described in the
preceding paragraph, and the Employee’s right to elect to have no such
Compensation reduction contributions made to the Plan as Before-Tax
Contributions, or to alter the amount of those contributions, including
the procedure for exercising that right and the timing for implementation
of any such election. Each Participant shall be notified annually of his
or her Compensation reduction percentage and the participant’s right to
change the percentage, including the procedure for exercising that right
and the timing for implementation of any such election.
	 
	 	 	 	A Participant may elect, on a form provided by the Plan Administrator, to
increase or decrease his Compensation reductions (within the percentage
limits stated above) or to cease future Compensation reductions as of any
payday, provided the Participant files such form with the Plan
Administrator on or

14

 

	 	 	 	before the Friday next preceding such payday. The Plan Administrator may
adopt rules concerning the administration of this subsection.
	 
	 	 	 	The Before-Tax Contributions made on behalf of each Participant shall be
paid to the Trustee every pay period, at the earliest date on which they
can reasonably be segregated from the Employer’s general assets, not later
than the 15th business day of the month following the month in which such
amounts would otherwise have been payable to the Participant in cash, and
shall be allocated to such Participant’s Account as of the date on which
they are received by the Trustee.
	 
	 	(b)	 	Matching Contributions. Each Employer shall make a Matching
Contribution on behalf of each Participant equal to 125 percent of the first
4 percent of Before-Tax Contributions made with respect to such Participant.
The Matching Contributions made on behalf of each Participant shall be paid
to the Trustee every pay period and allocated to such Participant’s Matching
Contributions Account as of the date on which they are received by the
Trustee. The amount of Matching Contributions shall be adjusted on or before
the close of the Plan Year, so that the total amount of Matching
Contributions made on behalf of each Participant for the Plan Year equals 125
percent of the first four percent of Compensation contributed by the
Participant as a Before-Tax Contribution during the Plan Year.
	 
	 	(c)	 	Catch-Up Contributions. All Participants who are eligible to make
Elective Contributions under this Plan and who would attain Age 50 by the end
of the taxable year shall be eligible to make catch-up contributions in
accordance with, and subject to the limitations of, Section 414(v) of the
Code. Such catch-up contributions shall not be taken into account for
purposes of the provisions of the Plan implementing the required limitations
of Sections 401(a)(30) and 415(c) of the Code. The Plan shall not be treated
as failing to satisfy the provisions of the Plan implementing the
requirements of Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b), or 416 of
the Code, as applicable, by reason of the making of such catch-up
contributions. This Section 3.1(c) shall apply to contributions after
December 31, 2001. No Matching Contributions shall be made with respect to
such catch-up contributions.

     4.4 After-Tax Contributions. Prior to January 1, 1989, each Participant was allowed
to contribute through payroll deductions, in addition to or in lieu of any Before-Tax Contributions
he was making under the Plan, certain specified percentages of his

15

 

Compensation (before reduction for Before-Tax Contributions) to the Plan. Effective January 1,
1989, no additional After-Tax Contributions shall be allowed under the Plan. After-Tax
Contributions made prior to January 1, 1989 shall continue to be held in each Member’s After-Tax
Contributions Account until distributed in accordance with the provisions of Article VI.

     4.5 Contingency of Contributions on Profits. This Plan is designed as a profit
sharing plan under section 401(a) of the Code. However, payment by an Employer of contributions to
the Plan shall not be contingent on the existence of current or accumulated profits of the
Employer.

     4.6 Application of Forfeitures. Forfeitures occurring during any Plan Year shall be
applied as follows:

	 	(a)	 	Such amounts shall be reallocated, as of the last day of the Plan
Year, among the Accounts of Participants reemployed by the Employer to the
extent required by the provisions of Section 5.4;
	 
	 	(b)	 	Such amounts remaining after the application of subsection (a) shall
be first applied to offset administrative expenses (not including expenses
which, pursuant to any applicable Plan provision, are charged solely to the
Account of a Participant to whom such expenses relate) to the extent such
expenses are properly payable by the Plan; and
	 
	 	(c)	 	Such amounts remaining after the application of subsections (a) and
(b) shall be used to reduce future Employer Profit Sharing and Matching
Contributions made under section 4.1 or due under section 4.3(b).

     4.7 Limitation of Elective Deferrals. The “Elective Deferrals” (as defined herein)
made on behalf of any Participant in any calendar year under this Plan and all other plans,
contracts or arrangements of the Company or any Affiliate shall not exceed the amount of the
limitation in effect under Code section 402(g)(1) for taxable years beginning in such calendar
year.

     With respect to any taxable year, a Participant’s “Elective Deferrals” are defined as the sum
of all employer contributions made on the Participant’s behalf pursuant to an election to defer
under any qualified cash or deferred arrangement under Code section 401(k) (including Before-Tax
Contributions under this Plan, except “catch-up Contributions” under Section 4.3(c)), any
simplified employee pension cash or deferred arrangement described in Code section 402(h)(1)(B),
any plan described in Code section 501(c)(18), and any employer contributions made for the purchase
of an annuity contract for the Participant under Code section 403(b) pursuant to a salary reduction
agreement.

16

 

     Notwithstanding any other provision of the Plan, “Excess Elective Deferrals” (as defined
herein), adjusted for any Income allocable thereto, shall be distributed no later than April 15 to
any Participant to whose Account Excess Elective Deferrals were allocated for the preceding year.
The amount distributed shall not exceed the Participant’s Before-Tax Contributions under the Plan
for the taxable year.

     “Excess Elective Deferrals” shall mean those Elective Deferrals that are includable in a
Participant’s gross income under section 402(g) of the Code to the extent such Participant’s
Elective Deferrals for a taxable year exceed the dollar limitation under such Code section, taking
into account only Elective Deferrals under this Plan and any other plans of the Company and any
Affiliate.

     The amount of Excess Elective Deferrals that may be distributed under this section with
respect to a Participant for a taxable year is reduced by any Excess Before-Tax Contributions
previously distributed pursuant to section 4.9 with respect to the Participant for the Plan Year
beginning with or within the taxable year.

     A corrective distribution of Excess Elective Deferrals under this section shall include Income
allocable to such Excess Elective Deferrals for the Plan Year in which such excess occurred, to be
determined in accordance with Regulations under Code section 402(g). In lieu of using the safe
harbor method or the alternative method in the Regulations for allocating such Income, the Plan
Administrator may use any reasonable method for computing such Income, provided that such method
does not violate Code section 401(a)(4), is used consistently for all Participants and for all
corrective distributions under the Plan for the Plan Year, and is used by the Plan for allocating
Income to Participant’s Accounts.

     4.8 Actual Deferral Percentage Test.

	 	(a)	 	Maximum Annual Allocation: Subject to section 4.9, for each Plan
Year the annual allocation derived from Before-Tax Contributions to
Participants’ Accounts shall satisfy one of the following tests:

	 	(1)	 	The Actual Deferral Percentage for the Highly
Compensated Participant group for the current Plan Year shall not be
more than the Actual Deferral Percentage of the Non-Highly
Compensated Participant group for the current Plan Year multiplied by
1.25, or
	 
	 	(2)	 	The excess of the Actual Deferral Percentage for the
Highly Compensated Participant group for the current Plan Year over
the Actual Deferral Percentage for the Non-Highly Compensated
Participant group for the current Plan Year shall not be more than
two percentage points. Additionally, the Actual Deferral Percentage
for the Highly Compensated Participant group for the current Plan
Year shall not exceed the Actual Deferral Percentage for the

17

 

	 	 	 	Non-Highly Compensated Participant group for the current Plan
Year multiplied by 2. The provisions of Code section 401(k)(3)
and Regulations section 1.401(k)-1(b) are incorporated herein by
reference.

	 	(b)	 	For the purposes of this section “Actual Deferral Percentage” means,
with respect to the Highly Compensated Participant group and Non-Highly
Compensated Participant group for a Plan Year, the average of the ratios,
calculated separately for each Participant in such group, of the amount of
Before-Tax Contributions allocated to each Participant’s Account for such
Plan Year, to such Participant’s Section 414(s) Compensation for such Plan
Year. The actual deferral ratio for each Participant and the Actual Deferral
Percentage for each group shall be calculated to the nearest one-hundredth of
one percent. Before-Tax Contributions allocated to each Non-Highly
Compensated Participant’s Account shall be reduced by Excess Elective
Deferrals, as defined in section 4.7, to the extent such Excess Elective
Deferrals are made under this Plan.
	 
	 	(c)	 	The determination of an Employee’s actual deferral ratio shall take
into account only the Employee’s Section 414(s) Compensation earned while the
Employee is a Plan Participant, unless the Plan Administrator determines that
Excess Before-Tax Contributions would be reduced by taking into account each
Employee’s Section 414(s) Compensation for the entire Plan Year.
	 
	 	(d)	 	For the purposes of section 4.8(a) and 4.9, a Highly Compensated
Participant and a Non-Highly Compensated Participant shall include any
Employee eligible to make a deferral election pursuant to section 4.3(a),
whether or not such deferral election was made or suspended pursuant to
section 4.3(a).
	 
	 	(e)	 	For the purposes of this section and Code sections 401(a)(4), 410(b)
and 401(k), if two or more plans of the Company or an Affiliate which have
the same plan year and which include cash or deferred arrangements are
considered one plan for the purposes of Code section 401(a)(4) or 410(b),
other than Code section 410(b)(2)(A)(ii), the cash or deferred arrangements
included in such plans shall be treated as one arrangement. In addition, two
or more cash or deferred arrangements contained in plans which have the same
plan year may be considered as a single arrangement for purposes of
determining whether or not such arrangements satisfy Code sections 401(a)(4),
410(b) and 401(k). In such a case, the cash or deferred arrangements
included in such plans and the plans including such arrangements shall be
treated as one arrangement

18

 

	 	 	 	and as one plan for purposes of this section and Code sections 401(a)(4),
410(b) and 401(k).
	 
	 	 	 	Notwithstanding the above, an employee stock ownership plan described in
Code section 4975(e)(7) may not be combined with this Plan for purposes of
determining whether the employee stock ownership plan or this Plan
satisfies this section and Code sections 401(a)(4), 410(b) and 401(k).
	 
	 	(f)	 	For the purposes of this section, if a Highly Compensated
Participant is a Participant under two or more cash or deferred arrangements
(other than cash or deferred arrangement which is part of an employee stock
ownership plan as defined in Code section 4975(e)(7)) of the Company or an
Affiliate, all such cash or deferred arrangements shall be treated as one
cash or deferred arrangement for the purpose of determining the actual
deferral ratio with respect to such Highly Compensated Participant. However,
if the cash or deferred arrangements have different plan years, this
paragraph shall be applied by treating all cash or deferred arrangements
ending with or within the same calendar year as a single arrangement.
	 
	 	(g)	 	In accordance with Code section 401(k)(3)(F), the Plan Administrator
may, in its discretion, elect to apply this section separately to each of two
groups of Participants:

	 	(1)	 	Non-Highly Compensated participants who have not
completed one Year of Service, or have not attained age 21; and
	 
	 	(2)	 	All other Participants.

If a Participant is described in both (1) and (2) above for different
portions of the Plan Year, the Participant, together with his or her
Compensation and Before-Tax Contributions, if any, shall be taken into
account under (1) above as if he or she were a Participant solely for pay
periods beginning prior to attainment of age 21 and completion of one Year
of Service, whichever occurs later, and shall be taken into account under
(2) above as if he or she were a Participant solely for pay periods
beginning after attainment of age 21 and completion of one Year of
Service, whichever occurs later.

	 	(h)	 	The Plan Administrator may take such additional action as it shall
consider appropriate to ensure compliance with the requirements of this
section, and section 4.9. Such action may include, but is not limited to,
reducing the maximum amount of Before-Tax Contributions under section 4.3
that can be contributed on behalf

19

 

	 	 	 	of or by any group of Highly Compensated Participants.

     4.9 Adjustment to Actual Deferral Percentage Test. If the initial allocations of the
Before-Tax Contributions made pursuant to section 4.3 do not satisfy one of the tests set forth in
section 4.8(a), the Plan Administrator shall adjust Excess Before-Tax Contributions in the manner
set forth below, whereupon the requirements of section 4.8(a) shall be deemed satisfied:

	 	(a)	 	On or before the fifteenth day of the third month following the end
of each Plan Year, the Plan Administrator shall determine and direct the
Trustee to distribute Excess Before-Tax Contributions in accordance with the
following rules:

	 	(1)	 	The Plan Administrator shall calculate the dollar
amount of Excess Before-Tax Contributions for each Highly Compensated
Participant. For each Highly Compensated Participant, the amount of
Excess Before-Tax Contributions is equal to the Before-Tax
Contributions on behalf of such Highly Compensated Participant
(determined prior to the application of this section) minus the amount
of Before-Tax Contributions which would remain if the Before-Tax
Contributions on behalf of all Highly Compensated Participants were
adjusted as follows:

	 	(A)	 	By reducing the Before-Tax
Contributions on behalf of the Highly Compensated
Participant(s) having the highest actual deferral ratio
until one of the tests set forth in section 4.8(a) is
satisfied, or until his actual deferral ratio equals the
actual deferral ratio of the Highly Compensated
Participant(s) having the second highest actual deferral
ratio; and
	 
	 	(B)	 	By repeating this process until
one of the tests set forth in section 4.8(a) is satisfied.

	 	(2)	 	The Plan Administrator shall compute the total
dollar amount of Excess Before-Tax Contributions for all Highly
Compensated Participants determined under paragraph (1), and shall
distribute this amount as provided in paragraphs (3) and (4).
	 
	 	(3)	 	The Before-Tax Contributions of the Highly
Compensated Participant with the highest dollar amount of Before-Tax
Contributions shall be reduced by the amount required to cause that
Highly Compensated Participant’s Before-Tax Contributions to equal
the dollar amount of the Before-Tax Contributions of the Highly
Compensated Participant with

20

 

	 	 	 	the next highest dollar amount of Before-Tax Contributions. This
amount is then distributed to the Highly Compensated Participant
with the highest dollar amount. However, if a lesser reduction,
when added to the total dollar amount already distributed under
this step, would equal the total Excess Before-Tax Contributions,
the lesser reduction amount shall be the amount distributed.
	 
	 	(4)	 	If the total amount distributed is less than the
total Excess Before-Tax Contributions, the step described in
paragraph (3) shall be repeated until the total Excess Before-Tax
Contributions have been distributed.
	 
	 	(5)	 	However, in determining the amount of Excess
Before-Tax Contributions to be distributed with respect to an
affected Highly Compensated Participant as determined herein, such
amount shall be reduced by any Excess Elective Deferrals previously
distributed from this Plan to such affected Highly Compensated
Participant for his taxable year ending with or within such Plan
Year.

	 	(b)	 	With respect to the distribution of Excess Before-Tax Contributions
pursuant to (a) above, such distribution:

	 	(1)	 	shall be made first from unmatched Before-Tax
Contributions, and, thereafter, simultaneously from Before-Tax
Contributions which are matched and Matching Contributions which
relate to such Before-Tax Contributions;
	 
	 	(2)	 	shall be made from Employer Profit Sharing
Contributions only to the extent that the amount required to be
distributed to the Participant exceeds the balance in the
Participant’s Account attributable to Before-Tax Contributions and
Employer Matching Contributions made pursuant to sections 4.3(a) and
4.3(b);
	 
	 	(3)	 	shall be adjusted for Income as provided in
paragraph (c) below; and
	 
	 	(4)	 	shall be designated by the Employer as a
distribution of Excess Before-Tax Contributions (and Income).

	 	(c)	 	A corrective distribution of Excess Before-Tax Contributions under
this section shall include Income allocable to such Excess Before-Tax
Contributions for the Plan Year in which such excess occurred, to be
determined in accordance with Regulations under

21

 

	 	 	 	Code section 401(k). In lieu of using the safe harbor method or the
alternative method in the Regulations for allocating such Income, the Plan
Administrator may use any reasonable method for computing such Income,
provided that such method does not violate Code section 401(a)(4), is used
consistently for all Participants and for all corrective distributions
under the Plan for the Plan Year, and is used by the Plan for allocating
Income to Participant’s Accounts.

     4.10 Actual Contribution Percentage Test.

	 	(a)	 	Maximum Annual Allocation: Subject to section 4.11, for each Plan
Year the annual allocation derived from Matching Contributions to
Participants’ Accounts shall satisfy one of the following tests:

	 	(1)	 	The Actual Contribution Percentage for the Highly
Compensated Participant group for the current Plan Year shall not be
more than the Actual Contribution Percentage of the Non-Highly
Compensated Participant group for the current Plan Year multiplied by
1.25, or
	 
	 	(2)	 	The excess of the Actual Contribution Percentage for
the Highly Compensated Participant group for the current Plan Year
over the Actual Contribution Percentage for the Non-Highly
Compensated Participant group for the current Plan Year shall not be
more than two percentage points. Additionally, the Actual
Contribution Percentage for the Highly Compensated Participant group
for the current Plan Year shall not exceed the Actual Contribution
Percentage for the Non-Highly Compensated Participant group for the
current Plan Year multiplied by 2. The provisions of Code section
401(m) and Regulations section 1.401(m)-1(b) are incorporated herein
by reference.

	 	(b)	 	For the purposes of this section “Actual Contribution Percentage”
means, with respect to the Highly Compensated Participant group and
Non-Highly Compensated Participant group for a Plan Year, the average of the
ratios, calculated separately for each Participant in such group, of the
amount of Matching Contributions allocated to each Participant’s Account for
such Plan Year, to such Participant’s Section 414(s) Compensation for such
Plan Year. The actual contribution ratio for each Participant and the Actual
Contribution Percentage for each group shall be calculated to the nearest
one-hundredth of one percent.

22

 

	 	(c)	 	The determination of an Employee’s actual contribution ratio shall
take into account only the Employee’s Section 414(s) Compensation earned
while the Employee is a Plan Participant, unless the Plan Administrator
determines that Excess Matching Contributions would be reduced by taking
into account each Employee’s Section 414(s) Compensation for the entire
Plan Year.
	 
	 	(d)	 	For the purposes of section 4.10(a) and 4.11, a Highly Compensated
Participant and a Non-Highly Compensated Participant shall include any
Employee eligible to make a deferral election under section 4.3(a) and
thereby become entitled to have Matching Contributions made for him pursuant
to section 4.3(b), whether or not such deferral election was made or
suspended pursuant to section 4.3(a).
	 
	 	(e)	 	For the purposes of this section and Code sections 401(a)(4), 410(b)
and 401(m), if two or more plans of the Company or an Affiliate which have
the same plan year and to which matching contributions, employee
contributions, or both are made are considered one plan for the purposes of
Code section 401(a)(4) or 410(b), other than the average benefits test under
Code section 410(b)(2)(A)(ii), such plans shall be treated as one plan. In
addition, two or more plans of the Employer to which matching contributions,
employee contributions, or both are made which have the same plan year may be
considered as a single plan for purposes of determining whether or not such
plans satisfy Code sections 401(a)(4), 410(b) and 401(m). In such a case,
aggregated plans must satisfy this section and Code sections 401(a)(4),
410(b) and 401(m) as though such aggregated plans were a single plan.
	 
	 	 	 	Notwithstanding the above, an employee stock ownership plan described in
Code section 4975(e)(7) may not be combined with this Plan for purposes of
determining whether the employee stock ownership plan or this Plan
satisfies this section and Code sections 401(a)(4), 410(b) and 401(m).
	 
	 	(f)	 	For the purposes of this section, if a Highly Compensated
Participant is a Participant under two or more plans (other than cash or
deferred arrangement which is part of an employee stock ownership plan as
defined in Code section 4975(e)(7)) which are maintained by the Employer or
an Affiliate and to which matching contributions, employee contributions, or
both are made, all such contributions on behalf of such Highly Compensated
Participant shall be aggregated for the purpose of determining the actual
contribution ratio with respect to such Highly Compensated Participant.
However, if the plans have different plan years, this paragraph shall be
applied by treating all such plans ending with or
within the same calendar year as a single plan.

23

 

	 	(g)	 	In accordance with Code section 401(m)(5)(C), the Plan Administrator
may, in its discretion, elect to apply this section separately to each of two
groups of Participants:

	 	(1)	 	Non-Highly Compensated participants who have not
completed one Year of Service, or have not attained age 21; and
	 
	 	(2)	 	All other Participants.

If a Participant is described in both (1) and (2) above for different
portions of the Plan Year, the Participant, together with his or her
Compensation and Matching Contributions, if any, shall be taken into
account under (1) above as if he or she were a Participant solely for pay
periods beginning prior to attainment of age 21 and completion of one Year
of Service, whichever occurs later, and shall be taken into account under
(2) above as if he or she were a Participant solely for pay periods
beginning after attainment of age 21 and completion of one Year of
Service, whichever occurs later.

	 	(h)	 	The Plan Administrator may take such additional action as it shall
consider appropriate to ensure compliance with the requirements of this
section, and section 4.11. Such action may include, but is not limited to,
reducing the maximum amount of Before-Tax Contributions under section 4.3
that can be contributed on behalf of or by any group of Highly Compensated
Participants.

     4.11 Adjustment to Actual Contribution Percentage Test. If the initial allocations
of the Matching Contributions made pursuant to section 4.3 do not satisfy one of the tests set
forth in section 4.10(a), the Plan Administrator shall adjust Excess Matching Contributions in the
manner set forth below, whereupon the requirements of section 4.10(a) shall be deemed satisfied:

	 	(a)	 	On or before the fifteenth day of the third month following the end
of each Plan Year, the Plan Administrator shall determine and direct the
Trustee to distribute and/or forfeit Excess Matching Contributions in
accordance with the following rules:

	 	(1)	 	The Plan Administrator shall calculate the dollar
amount of Excess Matching Contributions for each Highly Compensated
Participant. For each Highly Compensated Participant, the amount of
Excess Matching Contributions is equal to the Matching Contributions
on behalf of such Highly Compensated Participant (determined prior to
the application of this section) minus the amount of Matching

24

 

	 	 	 	Contributions which would remain if the Matching Contributions on
behalf of all Highly Compensated Participants were adjusted as
follows:

	 	(A)	 	By reducing the Matching
Contributions on behalf of the Highly Compensated
Participant(s) having the highest actual contribution ratio
until one of the tests set forth in section 4.10(a) is
satisfied, or until his actual contribution ratio equals the
actual contribution ratio of the Highly Compensated
Participant(s) having the second highest actual contribution
ratio; and
	 
	 	(B)	 	By repeating this process until
one of the tests set forth in section 4.10(a) is satisfied.

	 	(2)	 	The Plan Administrator shall compute the total
dollar amount of Excess Matching Contributions for all Highly
Compensated Participants determined under paragraph (1), and shall
distribute and/or forfeit this amount as provided in paragraphs (3)
and (4).
	 
	 	(3)	 	The Matching Contributions of the Highly Compensated
Participant with the highest dollar amount of Matching Contributions
shall be reduced by the amount required to cause that Highly
Compensated Participant’s Matching Contributions to equal the dollar
amount of the Matching Contributions of the Highly Compensated
Participant with the next highest dollar amount of Matching
Contributions. This amount is then distributed to the Highly
Compensated Participant with the highest dollar amount, to the extent
such Participant is vested in his Matching Contributions Account, and
is otherwise treated as a forfeiture. However, if a lesser
reduction, when added to the total dollar amount already distributed
under this step, would equal the total Excess Matching Contributions,
the lesser reduction amount shall be the amount distributed and/or
forfeited.
	 
	 	(4)	 	If the total amount distributed and/or forfeited is
less than the total Excess Matching Contributions, the step described
in paragraph (3) shall be repeated until the total Excess Matching
Contributions have been distributed and/or forfeited.

	 	(b)	 	Any distribution of less than the entire amount of Excess Matching
Contributions and Income shall be treated as a pro rata distribution of
Excess Matching Contributions and Income. Any distribution

25

 

	 	 	 	of Excess Matching Contributions (and Income) shall be designated as such
by the Employer. Forfeitures of Excess Matching Contributions shall be
treated in accordance with section 5.4.
	 
	 	(c)	 	Excess Matching Contributions, including forfeited Matching
Contributions shall be treated as Employer contributions for purposes of Code
sections 404 and 415 even if distributed from the Plan.
	 
	 	(d)	 	The determination of the amount of Excess Matching Contributions
with respect to any Plan Year shall be made after first determining the
Excess Before-Tax Contributions and resulting adjustments under sections 4.8
and 4.9.
	 
	 	(e)	 	A corrective distribution of Excess Matching Contributions under
this section shall include Income allocable to such Excess Matching
Contributions for the Plan Year in which such excess occurred, to be
determined in accordance with Regulations under Code section 401(m). In lieu
of using the safe harbor method or the alternative method in the Regulations
for allocating such Income, the Plan Administrator may use any reasonable
method for computing such Income, provided that such method does not violate
Code section 401(a)(4), is used consistently for all Participants and for all
corrective distributions under the Plan for the Plan Year, and is used by the
Plan for allocating Income to Participant’s Accounts.

     4.12 Limitations on Annual Account Additions.

	 	(a)	 	Annual Account Addition. “Annual Account Addition” means for any
Participant for any Plan Year, which shall also be the limitation year, the
sum of—

	 	(1)	 	employer contributions made for him under any
defined contribution plan for such Plan Year;
	 
	 	(2)	 	such Participant’s contributions to any defined
contribution plan for such Plan Year;
	 
	 	(3)	 	forfeitures allocated to him under any defined
contribution plan for such Plan Year; and
	 
	 	(4)	 	contributions allocated on his behalf to any
individual medical account as described under Code sections 401(h)(6)
and 419(A)(d).

26

 

“Any defined contribution plan” means all defined contribution plans of
the Company and Affiliates considered as one plan. For purposes of this
section, “Affiliate” shall have the meaning prescribed in section 2.1(b),
except that the phrase “more than 50 percent” shall be substituted for the
phrase “at least 80 percent” each place it appears in Code section
1563(a)(1). Repayments of a loan or a restored Forfeiture pursuant to
section 11.13 or a Rollover Contribution pursuant to section 4.9 shall not
be included as part of any Participant’s Annual Account Addition.

	 	(b)	 	Limitation. A Participant’s Annual Account Addition for any Plan
Year shall not exceed the lesser of—

	 	(1)	 	$40,000, as adjusted for increases in the cost of
living under Section 415(d) of the Code, such adjusted limitation to
be effective as of January 1st of each calendar year and applicable
to Plan Years ending with or within that calendar year; or
	 
	 	(2)	 	100 percent of such Participant’s Section 415
Compensation for such Plan Year.

	 	(c)	 	Reduction in Annual Account Additions. If in any Plan Year a
Participant’s Annual Account Addition exceeds the limitation determined under
subsection (b) above, such excess shall not be allocated to his accounts in
any defined contribution plan but shall be handled in the following manner
and order until such excess is eliminated:

	 	(1)	 	the portion of the Participant’s Before-Tax
Contributions that has not been matched under section 4.3(b) shall be
refunded to the Participant.
	 
	 	(2)	 	the portion of the Participant’s Before-Tax
Contributions that has been matched under section 4.3(b) shall be
refunded to the Participant and the corresponding portion of Matching
Contributions made with respect to such refunded Before-Tax
Contributions shall be placed in a suspense account.
	 
	 	(3)	 	the portion of the Participant’s Employer Profit
Sharing Contributions shall be placed in a suspense account.
	 
	 	 	 	The amount held in such suspense account shall be treated as a
Matching Contribution in the next following Plan Year and
allocated to the Matching Contributions Accounts of all
Participants pursuant to section 4.3(b). Such suspense
account shall share in the gains and losses of the Trust Fund on
the same basis as other Accounts.

27

 

If Before-Tax Contributions are refunded to any Participant, his share of
earnings and gains allocable to such Before-Tax Contributions shall also
be refunded to him.

The above reductions shall be applied to this Plan first, and thereafter
to any other defined contribution plan.

     4.13 Rollover Contributions. A Participant may, with the approval of the Plan
Administrator in accordance with procedures established by the Plan Administrator, contribute the
following amounts to the Plan, which shall be credited to his Rollover Contributions Account:

	 	(a)	 	a direct rollover of an eligible rollover distribution, excluding
after-tax contributions, from (i) a qualified plan described in Code section
401(a) or 403(a), (ii) an annuity contract or plan described in Code section
403(b), or (iii) an eligible plan under Code section 457(b) which is
maintained by a state, political subdivision of a state, or any agency or
instrumentality of a state or political subdivision of a state; or
	 
	 	(b)	 	amounts distributed to the Participant from a conduit individual
retirement account and transferred by the Participant to this Plan within
sixty (60) days of his receipt thereof from such conduit individual
retirement account, provided that the conduit individual retirement account
has no assets other than assets which

	 	(1)	 	were previously distributed to the Participant by
another plan described in subsection (a) hereof;
	 
	 	(2)	 	were eligible for tax-free rollover to such plan, and
	 
	 	(3)	 	were directly rolled over from such plan to the
conduit individual retirement account or were deposited in such
conduit individual retirement account within sixty (60) days of
receipt thereof; or
	 
	 	(4)	 	constitute earnings on assets described in
paragraphs (1) through (3).

     If the Participant has received the distribution, the related Rollover Contribution must be
paid over to the Trustee on or before the sixtieth day after receipt. In the case of a direct
rollover, the related Rollover Contribution must be transferred directly from said plan.

28

 

     Prior to accepting any transfer to which this Section applies, the Plan Administrator may
require the Participant to establish by that the amounts to be transferred to this Plan meet the
requirements of this Section. If the Plan Administrator determines that a contribution previously
accepted by the Plan as a Rollover Contribution was not a valid Rollover Contribution within the
meaning of subsections (a) and (b) hereof, the Plan Administrator shall direct the Trustee to
distribute the amount of the invalid Rollover Contribution, plus any earnings attributable thereto,
to the contributing Participant within a reasonable time after such determination.

Article V. Vesting in Accounts

     5.1 After-Tax, Before-Tax and Rollover Contributions Accounts. A Member shall at all
times be fully vested and have a nonforfeitable interest in his After-Tax Contributions Account,
his Before-Tax Contributions Account and his Rollover Contributions Account.

     5.2 Employer Profit Sharing and Matching Contributions Accounts

	 	(a)	 	General. A Member who (1) became a Participant prior to January 1,
2001, or (2) was an Employee on or before January 1, 2000 and became a
Participant on January 1, 2001 after completion of one year of Eligibility
Service, or (3) was an Employee prior to January 1, 2001 and became a
Participant after that date pursuant to section 3.1(a), shall at all times
have a 100 percent vested and nonforfeitable interest in his Employer Profit
Sharing and Matching Contributions Accounts.
	 
	 	 	 	A Member not described in the preceding sentence shall have a zero percent
vested and nonforfeitable interest in his Employer Profit Sharing and
Matching Contributions Accounts until the date the Member completes three
years of Vesting Service, and shall become 100 percent vested in such
Accounts on that date. Such Member includes an individual who first
became an Employee during the Plan Year ending December 31, 2000 and
pursuant to Plan provisions in effect on that date made an election to
become a Participant on January 1, 2001 and to be subject to the
three-year vesting schedule provided in this section 5.2(a) with respect
to Employer Matching Contributions and Employer Profit Sharing
Contributions
	 
	 	(b)	 	Accelerated Vesting. Notwithstanding subsection (a) above, a Member
shall be fully vested and have a nonforfeitable interest in his entire
Employer Profit Sharing and Matching Contributions Accounts on the earliest
date on which—

	 	(1)	 	he attains his Retirement Age while employed by the
Company or an Affiliate;

29

 

	 	(2)	 	he dies or suffers a Disability while employed by
the Company or an Affiliate; or
	 
	 	(3)	 	while he is employed by the Company or an Affiliate,
contributions to the Plan are completely discontinued or the Plan is
terminated, or the Plan is partially terminated and such Member is
affected by such partial termination.

     5.3 Vesting Service. A Member shall be credited with one year of Vesting Service for
each Plan Year in which the individual completed at least 1000 Hours of Service, subject to the
following rules:

	 	(a)	 	Years of Vesting Service completed after a period of
One-Year Breaks in Service shall not be required to be taken into
account for purposes of determining the non-forfeitable percentage of
a Member’s accrued benefit derived from contributions which occurred
prior to such period if the number of consecutive One-Year Breaks in
Service within such period equals or exceeds five.
	 
	 	(b)	 	In the case of a Participant who does not have any
nonforfeitable right to an accrued benefit under the Plan, Years of
Service with the Employer before a One-Year Break in Service shall
not be taken into account if the number of consecutive One-Year
Breaks in Service equals or exceeds five, or if greater, the
aggregate number of Years of Service before such period. If any
Years of Service are not required to be taken into account by reason
of a period of One-Year Breaks in Service to which this paragraph
applies, such Years of Service shall not be taken into account in
applying this paragraph to a subsequent period of One-Year Breaks in
Service.
	 
	 	(c)	 	For purposes of determining the Vesting Service of
an individual who is an employee of United States National Bank of
Red Lodge on the date such organization first becomes an Affiliate,
service previously completed by the individual as an employee of such
organization (including service for any affiliated or predecessor
entity taken into account for eligibility purposes in a qualified
pension or profit sharing plan maintained by such organization) shall
be taken into account to the same extent as service completed for an
Employer.
	 
	 	(d)	 	In the case of an individuals who was an employee of
Iowa

30

 

	 	 	 	State Bank and Trust immediately prior to becoming an Employee on
January 1, 2006, service previously completed by the individual
as an employee of Iowa State Bank and Trust shall be taken into
account to the same extent as service completed for an Employer.

     5.4 Forfeiture of Nonvested Amounts. If any portion of a Participant’s Account is
non-vested upon the Participant’s separation from Service, the non-vested amount shall be retained
in such Account until the earlier of the following events:

	 	(a)	 	the terminated Participant incurs five consecutive One-Year Breaks
in Service, or
	 
	 	(b)	 	prior to the close of the second Plan Year following the Plan Year
in which the Participant separates from Service, the terminated Participant
receives a distribution of his entire nonforfeitable accrued benefit under
the Plan.

     Upon the occurrence of the earlier of the events specified in (a) and (b), the non-vested
portion of the terminated Participant’s Account shall be immediately forfeited and shall be
transferred to a separate Forfeiture account until reallocated in accordance with this section.

     In the event the non-vested portion of a terminated Participant’s Account is forfeited upon a
distribution of such Participant’s entire nonforfeitable accrued benefit, the amount forfeited
shall be restored to the Participant’s Account, unadjusted for gains or losses of the Trust
subsequent to the distribution, if the Participant is reemployed by the Employer or an Affiliate
and repays the amount of the distribution before the earlier of five years after the date on which
the Participant is first subsequently reemployed by the Employer or Affiliate, or the close of the
first period of five consecutive One-Year Breaks in Service commencing after the distribution.

     For purposes of this section, a Participant who has no vested interest in his Account at the
time of separation from Service shall be deemed to have received a distribution of his entire
nonforfeitable accrued benefit under the Plan at such time, and shall be deemed to have repaid the
amount of such distribution at the time of any subsequent employment of the individual by the
Employer or an Affiliate.

     Amounts forfeited hereunder during any Plan Year shall be reallocated, as of the last day of
the Plan Year, among the Accounts of reemployed Participants to the extent this section 5.4
requires the restoration to such Accounts of amounts previously forfeited. If amounts forfeited
during the Plan Year do not equal or exceed the amount of restorations required for the Plan year,
the Employer shall contribute, in addition to the contributions provided in sections 4.1 and 4.3,
the amount necessary to fund such required restorations. The Employer’s contribution shall be made
no later than the close of the Plan Year next following the Plan Year during which such
restorations are required.

31

 

Article VI. Distributions and Withdrawals

     6.1 Distribution Upon Retirement, Death, or Disability. Subject to section 6.3, upon
a Member’s separation from Service after his Retirement Age or because of his Disability or death,
the full amount of Member’s Before-Tax, After-Tax and Rollover Contributions Accounts and the
vested portion of his Employer Profit Sharing and Matching Contributions Accounts shall be
distributed or made available to the Member, or in the case of death of the Member, to his
Beneficiary. The distribution shall be made in a lump sum or in installments as determined by the
Member, or by his Beneficiary (except that a Member may direct prior to his death the method by
which his Account shall be payable in the event of his death).

     At the time of electing a distribution in installments, a Member or Beneficiary must elect
which of the following methods shall govern the determination of the amount of each installment in
the series:

	 	(a)	 	Fixed Period Method. Under this method, a fixed number of annual
installments must be elected, and the amount of each installment shall equal
the quotient obtained by dividing the vested Account at the beginning of the
year by the number of unpaid annual installments remaining (including the
installment being calculated). The Member or Beneficiary may elect (1) to
receive each annual installment on a single Distribution Date each calendar
year; (2) to receive the annual installment for a year in four equal
quarterly payments, payable on the first Distribution Date in each calendar
quarter; or (3) to receive the annual installment in twelve equal payments,
on each Distribution Date during the year. This method of distribution shall
cease to be applicable if the amount of any payment is less than $25.
	 
	 	(b)	 	Fixed Amount Method. Under this method, the amount of each annual,
quarterly or monthly installment shall be a single fixed dollar amount
elected by the Member or Beneficiary, which, shall not exceed the “Applicable
Percentage” of the Member’s vested Account at the time the series of
distributions commences. In the case of an annual, quarterly or monthly
distribution, the “Applicable Percentage” shall be 10%, 2.5% or 0.83%,
respectively. The installment amount shall be paid to the Member or
Beneficiary (1) on a single Distribution Date each calendar year; in the case
of an annual installments; (2) on the first Distribution Date in each
calendar quarter; in the case of quarterly installments; or (3) on each
Distribution Date during the year, in the case of monthly installments.
Installment payments shall continue until the balance of the vested Account
on the applicable Distribution Date is less than or equal to the installment
amount elected by the Member or Beneficiary, whereupon the remainder of the
vested

32

 

	 	 	 	Account shall be distributed as the final installment. If the aggregate
amount of the installments to be distributed during a calendar year under
this method is less than the amount, if any, required to be distributed to
the Member or Beneficiary during the year under section 6.5, the Plan
Administrator shall cause the Trustee to distribute the difference to the
Member or Beneficiary within the time required by section 6.5.
	 
	 	(c)	 	Minimum Distribution Method. If distribution of the Member’s vested
Account is commenced during a calendar year in which a minimum distribution
is required under section 6.5, the Member or Beneficiary may elect to receive
an amount each year which is equal to the required minimum distribution for
the year. The Member or Beneficiary may elect to receive the annual amount
in one annual, four quarterly or twelve monthly payments as provided in
paragraph (a).

     A Member or Beneficiary who has elected an installment distribution may elect to withdraw an
additional amount at the time of receiving any single installment, by so notifying the Plan
Administrator at least three days and not more than 60 days in advance of the date on which the
installment would otherwise become payable, or may elect to change the method of distribution of
future installments by making a new election in accordance with paragraph (a), (b) or (c) hereof.
For purposes of applying paragraphs (a), (b) and (c) when there is a change in the method of
computing future installments, the series of installments shall be deemed to commence with the
first installment for which the change is to be made effective. All installment distributions
shall be subject to the requirements of section 6.5, and Code section 401(a)(9) and the Regulations
thereunder.

     The portion of an Account which has not been distributed to a Member or Beneficiary under an
installment distribution shall continue to be subject to periodic revaluation under section 9.4.
If a Member entitled to receive or receiving distribution under this section 6.1 should die prior
to the time he has received the full distribution from the Plan to which he is entitled, then the
amount to which he is entitled at the date of his death shall be distributed to the Member’s
Beneficiary by any of the methods specified above.

     6.2 Distribution upon Termination of Employment for Reasons Other Than Retirement, Death,
or Disability. Subject to section 6.3, upon a Member’s separation from Service for any reason
other than his retirement, death, or Disability, the full amount of the Member’s Before-Tax,
After-Tax and Rollover Contributions Accounts, and the vested portion of his Employer Profit
Sharing and Matching Contributions Accounts shall be distributed or made available to him.

     When a Member receives a distribution of the entire vested portion of his Accounts pursuant to
this section 6.2, the portions of his Employer Profit Sharing and Matching Contributions Accounts
which are not vested as of his termination of employment shall become a Forfeiture if and to the
extent provided in section 5.4.

33

 

     Distributions pursuant to this section 6.2 shall be made to the Member in a lump sum.

     If a former Participant dies after such separation from Service but prior to receiving the
full distribution from the Trust Fund to which he is entitled under this section 6.2 as specified
above, any unpaid balance thereof at the time of his death shall be distributed to the Member’s
Beneficiary in a lump sum, to be distributed as soon as practicable after his death.

     6.3 Consent to Early Distributions.

	 	(a)	 	No Consent Required. If a Member separates from Service and his
vested Account balance is not in excess of $5,000, the Member will receive a
distribution of the value of that vested portion of his Account without his
consent.
	 
	 	(b)	 	Consent Required. Where the Member’s vested Account balance is in
excess of $5,000, any payment to the Member under the Plan prior to the
Member’s sixty-second birthday may not be made without the Member’s written
consent. A Member’s consent to an early distribution shall not be valid
unless the Member has received notice containing a general description of the
material features and an explanation of the relative values of the optional
forms of benefit available under the Plan (if any) and information regarding
the Member’s right, if any, to defer receipt of the distribution. Such
information must be provided to a Member no less than 30 days and no more
than 90 days before payment under the Plan is scheduled to begin. The
Member’s written consent must not be made more than 90 days before payment
under the Plan is scheduled to begin. Notwithstanding the foregoing, such
distribution may commence less than 30 days after the notice is given,
provided that—

	 	(1)	 	the Plan Administrator clearly informs the Member
that the Member has a right to a period of at least 30 days after
receiving the notice to consider the decision of whether or not to
elect a distribution (and, if applicable, a particular distribution
option), and
	 
	 	(2)	 	the Member, after receiving the notice,
affirmatively elects a distribution.

	 	(c)	 	For distributions made after December 31, 2001 with respect to
Participants who separated from service after such date, for purposes of
determining whether a Participant’s nonforfeitable Account Balance exceeds
$5,000 under this Section 6.3, the value of a Participant’s nonforfeitable
Account balance shall be

34

 

	 	 	 	determined without regard to that portion of the Account balance that is
attributable to Rollover Contributions (and income allocable thereto)
within the meaning of Sections 402(c), 403(a)(4), 403(b)(8),
408(d)(3)(A)(ii) , and 457(e)(16) of the Code. If the value of the
Participant’s nonforfeitable Account balance as so determined is less than
or equal to $5,000, the plan shall immediately distribute the
participant’s entire nonforfeitable Account balance pursuant to paragraph
(a) hereof.

     6.4 Time of Distribution. A distribution under section 6.1 or 6.2 shall be made or
commence as of the first Distribution Date following the month in which the Member separated from
Service or, if the distribution is subject to section 6.3(b), any Distribution Date thereafter as
elected by the Member or the Beneficiary of a deceased Member.

     Unless the Member otherwise elects, distribution of the Member’s Account balance shall
commence not later than the 60th day after the close of the Plan Year in which the latest of the
following events occurs:

	 	(a)	 	The attainment by the Member of his Retirement Age;
	 
	 	(b)	 	The 10th anniversary of the date on which the Member commenced
participation in the Plan:
	 
	 	(c)	 	The termination of the Member’s Service;

provided, however, that the foregoing shall not require the commencement of benefits prior to the
“Required Beginning Date” described in section 6.5 unless the Participant has filed a claim for
benefits with the Plan Administrator.

     6.5 Required Minimum Distributions.

	 	(a)	 	Effective Date. The provisions of this Section will apply for
purposes of determining required minimum distributions for calendar years
beginning with the 2003 calendar year, as well as required minimum
distributions for the 2002 Distribution Calendar Year that are made on or
after January 1, 2003. Required minimum distributions for calendar years
prior to January 1, 2003 shall be governed by the Plan provisions in effect
prior to that date.
	 
	 	(b)	 	Precedence. The requirements of this Section will take precedence
over any inconsistent provisions of the Plan.
	 
	 	(c)	 	Requirements of Treasury Regulations Incorporated. All
distributions required under this Section will be determined and made in
accordance with the Regulations under section 401(a)(9) of the Internal
Revenue Code.

35

 

	 	(d)	 	Required Beginning Date. A Participant’s entire interest will be
distributed, or begin to be distributed, to the Participant no later than the
Participant’s Required Beginning Date.
	 
	 	(e)	 	Death of Participant Before Distributions Begin. If the Participant
dies before distributions begin, the Participant’s entire interest will be
distributed, or begin to be distributed, no later than as follows:

	 	(1)	 	If the Participant’s surviving spouse is the
Participant’s sole Designated Beneficiary, then, except as provided
in subsection (e)(3), distributions to the surviving spouse will
begin by December 31 of the calendar year immediately following the
calendar year in which the Participant died, or by December 31 of the
calendar year in which the Participant would have attained age 70
1/2, if later.
	 
	 	(2)	 	If the Participant’s surviving spouse is not the
Participant’s sole Designated Beneficiary, then, except as provided
in the subsection (e)(3), distributions to the Designated Beneficiary
will begin by December 31 of the calendar year immediately following
the calendar year in which the Participant died.
	 
	 	(3)	 	Participants or Beneficiaries may elect on an
individual basis whether the 5-year rule or the Life Expectancy rule
in subsection (j)(1) applies to distributions after the death of a
Participant who has a Designated Beneficiary. The election must be
made no later than the earlier of September 30 of the calendar year
in which distribution would be required to begin under subsections
(e)(1) and (e)(2), or by September 30 of the calendar year which
contains the fifth anniversary of the Participant’s (or, if
applicable, surviving spouse’s) death. If neither the Participant
nor Beneficiary makes an election under this paragraph, distributions
will be made in accordance with subsections (e)(1), (e)(2) and
(j)(1).
	 
	 	(4)	 	If there is no Designated Beneficiary as of
September 30 of the year following the year of the Participant’s
death, the Participant’s entire interest will be distributed by
December 31 of the calendar year containing the fifth anniversary of
the Participant’s death.
	 
	 	(5)	 	If the Participant’s surviving spouse is the
Participant’s sole Designated Beneficiary and the surviving spouse
dies after the Participant but before distributions to the surviving
spouse begin, this subsection (e), other than subsection
(e)(1), will apply as if the surviving spouse were the
Participant.

36

 

	 	 	 	For purposes of this subsection (e) and subsections (i) and (j), unless
subsection (e)(5) applies, distributions are considered to begin on the
Participant’s Required Beginning Date. If subsection (e)(5) applies,
distributions are considered to begin on the date distributions are
required to begin to the surviving spouse under subsection (e)(1). If
distributions under an annuity purchased from an insurance company
irrevocably commence to the Participant before the Participant’s Required
Beginning Date (or to the Participant’s surviving spouse before the date
distributions are required to begin to the surviving spouse under
subsection (e)(1)), the date distributions are considered to begin is the
date distributions actually commence.
	 
	 	(f)	 	Forms of Distribution. Unless the Participant’s interest is
distributed in the form of an annuity purchased from an insurance company or
in a single sum on or before the Required Beginning Date, as of the first
Distribution Calendar Year distributions will be made in accordance with
subsections (g) through (j) of this Section. If the Participant’s interest
is distributed in the form of an annuity purchased from an insurance company,
distributions thereunder will be made in accordance with the requirements of
section 401(a)(9) of the Code and the Treasury regulations.
	 
	 	(g)	 	Amount of Required Minimum Distribution For Each Distribution
Calendar Year During Participant’s Lifetime. During the Participant’s
lifetime, the minimum amount that will be distributed for each Distribution
Calendar Year is the lesser of:

	 	(1)	 	The quotient obtained by dividing the Participant’s
Account Balance by the distribution period in the Uniform Lifetime
Table set forth in section 1.401(a)(9)-9 of the Regulations, using
the Participant’s age as of the Participant’s birthday in the
Distribution Calendar Year; or
	 
	 	(2)	 	If the Participant’s sole Designated Beneficiary for
the Distribution Calendar Year is the Participant’s spouse, the
quotient obtained by dividing the Participant’s Account Balance by
the number in the Joint and Last Survivor Table set forth in section
1.401(a)(9)-9 of the Regulations, using the Participant’s and
spouse’s attained ages as of the Participant’s and spouse’s birthdays
in the Distribution Calendar Year.

37

 

	 	(h)	 	Lifetime Required Minimum Distributions Continue Through Year of
Participant’s Death. Required minimum distributions will be determined under
subsection (g) beginning with the first Distribution Calendar Year and up to
and including the Distribution Calendar Year that includes the Participant’s
date of death.
	 
	 	(i)	 	Death On or After Date Distributions Begin. If the Participant dies
on or after the date distributions begin, required minimum distributions
shall be determined as follows:

	 	(1)	 	Participant Survived by Designated Beneficiary. If
the Participant dies on or after the date distributions begin and
there is a Designated Beneficiary, the minimum amount that will be
distributed for each Distribution Calendar Year after the year of the
Participant’s death is the quotient obtained by dividing the
Participant’s Account Balance by the longer of the remaining Life
Expectancy of the Participant or the remaining Life Expectancy of the
Participant’s Designated Beneficiary, determined as follows:

	 	(A)	 	The Participant’s remaining Life
Expectancy is calculated using the age of the Participant in
the year of death, reduced by one for each subsequent year.
	 
	 	(B)	 	If the Participant’s surviving
spouse is the Participant’s sole Designated Beneficiary, the
remaining Life Expectancy of the surviving spouse is
calculated for each Distribution Calendar Year after the
year of the Participant’s death using the surviving spouse’s
age as of the spouse’s birthday in that year. For
Distribution Calendar Years after the year of the surviving
spouse’s death, the remaining Life Expectancy of the
surviving spouse is calculated using the age of the
surviving spouse as of the spouse’s birthday in the calendar
year of the spouse’s death, reduced by one for each
subsequent calendar year.
	 
	 	(C)	 	If the Participant’s surviving
spouse is not the Participant’s sole Designated Beneficiary,
the Designated Beneficiary’s remaining Life Expectancy is
calculated using the age of the Beneficiary in the year
following the year of the

38

 

	 	 	 	Participant’s death, reduced by one for each subsequent
year.

	 	(2)	 	No Designated Beneficiary. If the Participant dies
on or after the date distributions begin and there is no Designated
Beneficiary as of September 30 of the year after the year of the
Participant’s death, the minimum amount that will be distributed for
each Distribution Calendar Year after the year of the Participant’s
death is the quotient obtained by dividing the Participant’s Account
Balance by the Participant’s remaining Life Expectancy calculated
using the age of the Participant in the year of death, reduced by one
for each subsequent year.

	 	(j)	 	Death Before Date Distributions Begin. If the Participant dies
before the date distributions begin, required minimum distributions shall be
determined as follows:

	 	(1)	 	Participant Survived by Designated Beneficiary.
Except as provided in subsection (e)(3), if the Participant dies
before the date distributions begin and there is a Designated
Beneficiary, the minimum amount that will be distributed for each
Distribution Calendar Year after the year of the Participant’s death
is the quotient obtained by dividing the Participant’s Account
Balance by the remaining Life Expectancy of the Participant’s
Designated Beneficiary, determined as provided in subsection (i).
	 
	 	(2)	 	No Designated Beneficiary. If the Participant dies
before the date distributions begin and there is no Designated
Beneficiary as of September 30 of the year following the year of the
Participant’s death, distribution of the Participant’s entire
interest will be completed by December 31 of the calendar year
containing the fifth anniversary of the Participant’s death.
	 
	 	(3)	 	Death of Surviving Spouse Before Distributions to
Surviving Spouse Are Required to Begin. If the Participant dies
before the date distributions begin, the Participant’s surviving
spouse is the Participant’s sole Designated Beneficiary, and the
surviving spouse dies before distributions are required to begin to
the surviving spouse under subsection (e)(1), this subsection (j)
will apply as if the surviving spouse were the Participant.

	 	(k)	 	Definitions. The following definitions shall be applicable for
purposes of this Section 4.6:

39

 

	 	(1)	 	“Designated Beneficiary” shall mean the individual
who is designated as the Beneficiary under Section 4.4 of the Plan
and is the Designated Beneficiary under section 401(a)(9) of the
Internal Revenue Code and section 1.401(a)(9)-1, Q&A-4, of the
Regulations.
	 
	 	(2)	 	“Distribution Calendar Year” shall mean a calendar
year for which a minimum distribution is required. For distributions
beginning before the Participant’s death, the first Distribution
Calendar Year is the calendar year immediately preceding the calendar
year which contains the Participant’s Required Beginning Date. For
distributions beginning after the Participant’s death, the first
Distribution Calendar Year is the calendar year in which
distributions are required to begin under subsection (e). The
required minimum distribution for the Participant’s first
Distribution Calendar Year will be made on or before the
Participant’s Required Beginning Date. The required minimum
distribution for other Distribution Calendar Years, including the
required minimum distribution for the Distribution Calendar Year in
which the Participant’s Required Beginning Date occurs, will be made
on or before December 31 of that Distribution Calendar Year.
	 
	 	(3)	 	“Life Expectancy” shall mean Life Expectancy as
computed by use of the Single Life Table in section 1.401(a)(9)-9 of
the Treasury regulations.
	 
	 	(4)	 	“Participant’s Account Balance” shall mean the
Account Balance as of the last Valuation Date in the calendar year
immediately preceding the Distribution Calendar Year (valuation
calendar year) increased by the amount of any contributions made and
allocated or forfeitures allocated to the Account Balance as of dates
in the valuation calendar year after the valuation date and decreased
by distributions made in the valuation calendar year after the
valuation date. The Account Balance for the valuation calendar year
includes any amounts rolled over or transferred to the Plan either in
the valuation calendar year or in the Distribution Calendar Year if
distributed or transferred in the valuation calendar year.
	 
	 	(5)	 	“Required Beginning Date” shall mean April 1st of
the calendar year following the later of (1) the calendar year in
which the Member attains age 70-1/2 or (2) the calendar

40

 

	 	 	 	year in which the Member retires, provided, however, that this
clause (2) shall not apply in the case of a Member who is a “Five
Percent Owner” (as defined in Code section 416(i)(1)(B)) with
respect to the Plan Year ending in the calendar year in which he
attains age 70-1/2, and, in the case of a Member who becomes a
Five Percent Owner during any subsequent Plan Year, clause (2)
shall no longer apply and the Required Beginning Date shall be
the April 1st of the calendar year following the calendar year in
which such subsequent Plan Year ends.

	 	(l)	 	TEFRA Section 242(b) Elections. Notwithstanding the other
provisions of this Section 4.6, distributions may be made under a designation
made before January 1, 1984, in accordance with Section 242(b)(2) of the Tax
Equity and Fiscal Responsibility Act (“TEFRA”) and Section 4.13 of the Plan.

     6.6 Withdrawals.

	 	(a)	 	General. Each request for a withdrawal shall be submitted on a form
prescribed by the Plan Administrator. Subject to section 6.3, the Plan
Administrator may require that a request for a withdrawal be submitted within
a certain period of time prior to a Distribution Date; and that each
withdrawal be made as soon as administratively possible after such
Distribution Date.
	 
	 	(b)	 	Withdrawals.

	 	(1)	 	Each Member may request a partial or total
withdrawal of his After-Tax Contributions Account as of any
Distribution Date.
	 
	 	(2)	 	Each Member may request a partial or total
withdrawal of the vested portion of his Matching Contributions
Account and/or his Employer Profit Sharing Contributions Account
prior to the Member’s termination of employment as of any January 15,
but only if one of the following conditions is met:

	 	(A)	 	the withdrawal is made after the
Employee has been a Participant in the Plan for five years
or more; or
	 
	 	(B)	 	the withdrawal represents a
Matching Contribution amount or an Employer Profit Sharing
Contribution amount that has been a part of the Trust Fund
for at least two years.

41

 

	 	 	 	In addition, each Member who has attained age 591/2 may request a
partial or total withdrawal of the vested portion of his Matching
Contributions Account and/or Employer Profit Sharing
Contributions Account as of any Distribution Date.
	 
	 	(3)	 	Each Member may request a partial or total
withdrawal of the vested portion of his Matching Contributions
Account and/or his Employer Profit Sharing Contributions Account
prior to the Member’s termination of employment, but only if the
withdrawal is made on account of a financial hardship as described in
section 6.8 below.
	 
	 	(4)	 	Each Member may request a partial or total
withdrawal of his Before-Tax Contributions Account, but only if the
withdrawal is after his attainment of age 591/2 or is because of a
financial hardship. Financial hardship shall be limited to the
situations described in section 6.8 below.
	 
	 	 	 	In addition, a Member’s request for a withdrawal on account of
financial hardship must be accompanied or supplemented by such
evidence of hardship as the Plan Administrator may reasonably
require. Such evidence will include representations from the
Participant that the need cannot be relieved—

	 	(A)	 	through reimbursement or
compensation by insurance or otherwise,
	 
	 	(B)	 	by reasonable liquidation of the
Participant’s assets, to the extent such liquidation would
not itself cause an immediate and heavy financial need;
	 
	 	(C)	 	by cessation of Before-Tax
Contributions under the Plan; or
	 
	 	(D)	 	by other distributions or
nontaxable (at the time of the loan) loans from plans
maintained by the Employer, or any employer, or by borrowing
from commercial sources on reasonable commercial terms.

	 	 	 	For purposes of these requirements, the Participant’s resources
shall be deemed to include the assets of the Participant’s spouse
and minor children that are reasonably available to the
Participant.

42

 

	 	 	 	Approval or disapproval of such withdrawal request shall be
within the sole discretion of the Plan Administrator. The Plan
Administrator shall be entitled to reasonably rely upon such
representation by the Participant and shall not make an
independent investigation of the Participant’s financial affairs.
The amount of the withdrawal shall be limited to that amount
necessary to meet the immediate financial needs created by the
hardship.
	 
	 	 	 	Upon the withdrawal of any part of a Member’s Before-Tax
Contributions Account under this paragraph (4) on account of
“financial hardship,” any election of Before-Tax Contributions by
that Member shall be cancelled. The Member shall next be
permitted to have Before-Tax Contributions made on his behalf as
follows:

	 	(i)	 	A Member who receives a
distribution of Before-Tax Contributions before calendar
year 2002 on account of “financial hardship” shall next be
permitted to have Before-Tax Contributions made on his
behalf on or after the January 1, April 1, July 1, or
October 1 coincident with or next following the first
anniversary of such withdrawal, by making a new election in
accordance with section 4.3(a).
	 
	 	(ii)	 	A Member who receives a
distribution of Before-Tax Contributions after December 31,
2001, on account of “financial hardship” shall be prohibited
from having Before Tax Contributions made on his account
under this Plan, and shall be prohibited from making
elective deferrals and employee contributions under all
other plans of the Employer, for six months after receipt of
the distribution. The Participant may resume having
Before-Tax Contributions made on his behalf as of the first
day of any month following the six-month period of
suspension, by making a new election in accordance section
4.3(a).

	 	 	 	A distribution from a Member’s Before-Tax Contributions Account
which is made on account of “financial hardship” may not include
earnings credited to a Member’s Before-Tax Contributions Account
on or after January 1, 1989.
	 
	 	(5)	 	Each Member may request a partial or total
withdrawal of part or all of his Rollover Contributions Account as of
any Distribution Date.

43

 

	 	(c)	 	Accounting for After-Tax Contributions. The Plan Administrator may
establish and maintain such accounts as may be deemed advisable to determine
the Participant’s After-Tax Contributions (and any earnings on such After-Tax
Contributions) for taxation of any such withdrawals made pursuant to this
section 6.6.

     6.7 Loans. Each Member or beneficiary of a Member (collectively referred to in this
section as “borrower”) may, with the approval of the Plan Administrator, borrow amounts from the
borrower’s Account, subject to the following terms and conditions:

	 	(a)	 	The terms of such loan shall be determined in the sole discretion of
the Plan Administrator, subject to the provisions of this section 6.7. The
Plan Administrator shall promulgate and may, from time to time, amend a loan
procedure document which is incorporated by reference herein. The Plan
Administrator may also adopt rules limiting the number of loans that may be
made in any Plan Year by each borrower, may prescribe a minimum amount that
may be borrowed, and may establish other rules relating to loans made under
this section. Each request for a loan shall be submitted on a form prescribed
by the Plan Administrator. Each loan shall be made as of a Valuation Date
coincident with or following the request for the loan; the Plan Administrator
may require that a request for a loan be submitted within a certain period of
time prior to such Valuation Date; and each loan shall be made as soon as
administratively possible after such Valuation Date.
	 
	 	(b)	 	Each loan from the Plan shall be adequately secured. For this
purpose, one-half of the borrowing Participant’s vested interest in the Plan,
determined immediately after the loan is made, shall automatically constitute
security for the loan and for each prior outstanding loan, provided, however,
that such security shall be applied in satisfaction of the loan(s) only at
the time and in the manner provided in this section 6.7.
	 
	 	(c)	 	The term of such loan shall not exceed five years (15 years in the
case of a loan for the acquisition of a principal residence of the borrower).
	 
	 	(d)	 	Such loan shall bear a reasonable rate of interest, which shall be
commensurate with the interest rates being charged at the time such loan is
made under similar circumstances by financial institutions in the community
in which the Employer’s principal office is then located.

44

 

	 	(e)	 	The amount of such loan (when added to the outstanding balance of
all other loans to the borrower from the borrower’s Account) shall not exceed
the lesser of—

	 	(1)	 	$50,000, reduced by the excess (if any) of—

	 	(A)	 	the highest outstanding balance of
loans from the Plan during the one-year period ending on the
day before the loan was made, over
	 
	 	(B)	 	the outstanding balance of loans
from the Plan on the date the loan is made; or

	 	(2)	 	50 percent of the vested and nonforfeitable portion
of such borrower’s Account at the relevant time.

	 	 	 	Notwithstanding the preceding provisions of this subsection, in no event
shall the outstanding balance of such loan exceed 50 percent of such
borrower’s vested Account, or such lower percentage as the Plan
Administrator in its sole discretion may impose by the adoption of a rule.
	 
	 	(f)	 	Such loan shall be evidenced by a promissory note, in such form and
containing such terms and conditions as the Plan Administrator from time to
time directs.
	 
	 	(g)	 	Payments of principal and interest shall be made by approximately
equal payments, at least quarterly, on a basis that would permit such loan to
be levelly amortized over its term. Prepayments of principal and interest may
be made, in whole or in part, at any time without penalty. Payments from
Participants (other than prepayments) shall be made by payroll deduction.
	 
	 	(h)	 	Appropriate disclosure shall be made pursuant to the Truth in
Lending Act to the extent applicable.
	 
	 	(i)	 	Amounts of principal and interest received on a loan shall be
credited to such borrower’s Account, and the outstanding loan balance shall
be considered an investment of the assets of such Account.
	 
	 	(j)	 	Loans shall be deemed to have been made on a pro rata basis from the
available funds of each of the Investment Funds in which such borrower’s
Account is invested, except that amounts invested in the Company stock
Investment Fund shall not be taken into account unless requested by the
borrower or needed to fund the proceeds of the loan. All loan repayments
shall be reinvested in

45

 

	 	 	 	accordance with the borrower’s current investment directive in effect
under section 7.3.
	 
	 	(k)	 	To the extent that the borrower’s Account becomes payable, the
unpaid balance of the loan shall be deducted from the amount otherwise
payable from the borrower’s Account. The preceding sentence shall not apply
in the case of an in-service or hardship withdrawal or an installment
distribution during the lifetime of the borrower, unless so requested by the
borrower.
	 
	 	(l)	 	Foreclosure on an Account used as security for a loan shall be
deferred until a permissible distribution may occur under the terms of the
Plan. If a default in the payment of any loan or installment thereon remains
uncured for thirty days after written notice of such default is either hand
delivered or mailed to the borrower by certified mail, return receipt
requested, and the borrower has retired, become disabled, separated from
Service, has attained age 59-1/2, or is a beneficiary of a deceased Member
with respect to the Account which secures the loan, then the Plan
Administrator shall direct the Trustee to reduce the borrower’s Account by
the unpaid balance of the loan, including interest, to the extent of the
security interest held by the Plan, and to teat the amount of such reduction
as a payment on the loan. Such reduction of the borrower’s Account shall be
considered a distribution and shall be subject to the consent requirements
set forth in section 6.3; provided, however, that pursuant to Regulations
under Code sections 401(a)(11) and 411 such consent requirements shall be
deemed satisfied as of the time the borrower agreed to use his Account as
security for the loan.

     6.8 Financial Hardship. For purposes of sections 6.6(b)(3) and 6.6(b)(4), financial
hardship means one of the following situations:

	 	(a)	 	Financial obligations incurred by a Member because of sickness,
accident, death, or disability in his immediate family which he is not able
to pay for out of liquid assets or current cash flow.
	 
	 	(b)	 	Inability to purchase out of liquid assets or current cash flow, or
otherwise reasonably finance, the purchase of a primary residence for a
Member’s immediate family.
	 
	 	(c)	 	Inability to pay out of liquid assets or current cash flow, or
otherwise reasonably finance, an education for a person in a Member’s
immediate family.
	 
	 	(d)	 	Situations permitted by final Regulations under Code section 401(k).

46

 

	 	(e)	 	Situations permitted by written hardship guidelines approved by the
Plan Administrator.

     6.9 Eligible Rollover Distribution.

	 	(a)	 	Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a distributee’s election under this section, a distributee
may elect, at the time and in the manner prescribed by the Plan
Administrator, to have any portion of an eligible rollover distribution from
this Plan paid directly to an eligible retirement plan specified by the
distributee in a direct rollover, and to have any portion of the eligible
rollover distribution which is not rolled over to an eligible retirement plan
distributed directly to the distributee.
	 
	 	 	 	In the event of a mandatory distribution greater than $1,000 in accordance
with the provisions of section 6.3(a), if the distributee does not elect
to have such distribution paid directly to an eligible retirement plan
specified by the distributee in a direct rollover or to receive the
distribution directly in accordance with this section 6.9(a), then the
Plan Administrator will pay the distribution in a direct rollover to an
individual retirement plan designated by the Plan Administrator, and will
notify the Distributee in writing, either as part of the notice required
under Code Section 402(f) or separately, that the distribution may be
transferred to another individual retirement plan. For purposes of this
paragraph, a “mandatory distribution is an eligible rollover distribution
that is made to a Participant without the Participant’s consent and that
is made to the Participant before the Participant attains Age 62.
	 
	 	(b)	 	Definitions—

	 	(1)	 	An eligible rollover distribution is any
distribution of all or any portion of the balance to the credit of
the distributee, except that an eligible rollover distribution does
not include:

	 	(A)	 	Any distribution that is one of a
series of substantially equal periodic payments (not less
frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or joint
life expectancies) of the distributee and the distributee’s
designated beneficiary, or for a specified period of ten
years or more;
	 
	 	(B)	 	Any distribution to the extent
such distribution is
required under Code section 401(a)(9);

47

 

	 	(C)	 	Any distribution made after
December 31, 2001 on account of a Member’s financial
hardship; and
	 
	 	(D)	 	The portion of any distribution
that is not includible in gross income (determined without
regard to the exclusion for net unrealized appreciation with
respect to employer securities). Notwithstanding the
foregoing, a portion of a distribution shall not fail to be
an eligible rollover distribution merely because the portion
consists of after-tax employee contributions which are not
includible in gross income. However, such portion may be
transferred only to an individual retirement account or
annuity described in Section 408(a) or (b) of the Code, or
to a qualified defined contribution plan described in
Section 401(a) or 403(a) of the Code that agrees to
separately account for amounts so transferred, including
separately accounting for the portion of such distribution
which is includible in gross income and the portion of such
distribution which is not so includible.

	 	(2)	 	An eligible retirement plan is an individual
retirement account described in Section 408(a) of the Code, an
individual retirement annuity described in Section 408(b) of the
Code, an annuity plan or contract described in Section 403(a) or
403(b) of the Code, or a qualified trust described in Section 401(a)
of the Code, that accepts the distributee’s eligible rollover
distribution. “Eligible retirement plan” shall also mean an eligible
plan under Section 457(b) of the Code which is maintained by a state,
political subdivision of a state, or any agency or instrumentality of
a state or political subdivision of a state and which agrees to
separately account for amounts transferred into such plan from this
plan. However, in the case of an eligible rollover distribution to
the surviving spouse prior to January 1, 2002, an eligible retirement
plan is limited to an individual retirement account or individual
retirement annuity.
	 
	 	(3)	 	A distributee includes an Employee or former
Employee. In addition, the Employee’s or former Employee’s surviving
spouse and the Employee’s or former Employee’s spouse or former
spouse who is the alternate payee under a

48

 

	 	 	 	qualified domestic relations order, as defined in Code section
414(p), are distributees with regard to the interest of the
spouse or former spouse.
	 
	 	(4)	 	A direct rollover is a payment by the Plan to the
eligible retirement plan specified by the distributee.

Article VII. Investment Elections

     7.1 Investment of Accounts. At the times and in the manner provided in section 7.3,
each Member may elect to have his Account, other than the portion thereof which is invested in
Company stock, be invested in any one or more of the Investment Funds, either by electing one of
the model portfolios, if any, offered by the Plan Administrator pursuant to section 7.2, or by
self-directing the specific percentages of the Account to be invested in each Investment Fund.
Self-directed investment of the Account in one or more Investment Funds and/or model portfolios
shall be in such increments as may be permitted by the Plan Administrator on a uniform and
nondiscriminatory basis. The Member’s election shall apply to the investment of his Account, if
any, existing at the time of such election, other than the portion thereof which is invested in
Company stock, and to future After-Tax, Before-Tax, Employer Profit Sharing, Matching and Rollover
Contributions made on his behalf, until the Member changes his election as provided in section 7.3.
A Member may direct the investment of a portion of his Account in Company stock only through an
investment transfer governed by Article VIII.

     7.2 Model Portfolios. The Plan Administrator may from time to time establish one or
more model portfolios each of which is offered to Members as a specific investment option. Each
model portfolio shall consist of a mix, in specified percentages, of some or all of the Investment
Funds, not including the stock fund described in Article VIII. If a Member chooses to invest his
Account in a model portfolio, the Member shall be deemed to have instructed the Plan Administrator
to direct the investment of his Account, other than any portion thereof invested in Company stock,
and any future After-Tax, Before-Tax, Employer Profit Sharing, Matching and Rollover Contributions
made on his behalf, in the specific Investment Funds and in the respective percentages designated
for that model portfolio, and to rebalance his Account according to the same percentages from time
to time under rules established by the Plan Administrator for periodic rebalancing of model
portfolio Accounts, until the member changes his election pursuant to section 7.3.

     7.3 Investment Elections. Each Member may make the elections described in section
7.1 and change such elections within a reasonable time after first becoming a Participant, and from
time to time in accordance with procedures established by the Plan Administrator. The Plan
Administrator may permit the making and changing of such elections through the completion and
filing of election forms, or through internet and/or voice response facilities, or any combination
of the foregoing, provided that the election procedures shall permit Members and Beneficiaries to
give investment instructions no less frequently than once within any three month period. If a
Member fails to make an

49

 

election, that Member shall be deemed to have elected to invest in a default Investment Fund
or model portfolio selected by the Plan Administrator.

     7.4 Transfer of Assets. The Plan Administrator shall direct the Trustee to transfer
moneys or other property from the appropriate Investment Fund to the other Investment Fund as may
be necessary to carry out the aggregate transfer transactions after the Plan Administrator has
caused the necessary entries to be made in the Members’ Accounts in the Investment Funds and has
reconciled offsetting transfer elections, in accordance with uniform rules established by the Plan
Administrator.

     7.5 Consequence of Investment Elections. In accordance with section 404(c) of ERISA
and regulations thereunder, the provisions of this Article VII are intended to protect the Plan,
the Employer, the Plan Administrator and the Trustee from liability for investment results where a
Member exercises control over the assets in his Plan Account. In complying with such section of
ERISA, the Plan Administrator shall be the fiduciary designated to provide information to Members,
receive Member’s investment instructions, and provide written confirmation of investment elections
to Members.

     7.6 Distributions and Withdrawals. In the case of any cash distribution or
withdrawal under Article VI, to the extent administratively feasible such distribution or
withdrawal shall be funded by a pro rata liquidation or partial liquidation of the assets in which
the distributee’s Account is invested, including Company stock held for the Account of the
distributee pursuant to Article VIII, but not including any outstanding loan which is treated as an
investment of the Account under section 6.7.

Article VIII. Company Stock

     8.1 An Investment Fund. Notwithstanding anything to the contrary in this Plan, the
Investment Fund consisting of Company stock, established as of January 1, 1995 under section
2.1(cc), shall be governed by the provisions of this Article.

     8.2 Purchase of Shares. The shares of Company stock available for purposes of the
Plan shall be purchased by the Trustee from the Company or from such other person or persons and at
such time or times as the Trustee may in its sole discretion determine. Company stock may or may
not be available for purchase in a given Plan Year.

     If available, full shares of Company stock may be purchased (effective as of such date as
designated by the Plan Administrator) by the Member’s election (made during the time period
designated by the Plan Administrator) to transfer assets from other Investment Funds into Company
stock; provided, however, that—

	 	(a)	 	Rollover Contributions Account assets shall not be used to purchase
stock; and
	 
	 	(b)	 	the maximum investment in Company stock shall, at the time of the
election, in no event exceed 50 percent of the Member’s
Account balance less the Rollover Contributions Account.

50

 

     The purchase price shall be the price of the Company stock as determined by an independent
financial appraisal firm as of the last preceding Valuation Date for which an appraisal has been
issued.

     In the event the total request for purchase of Company stock when offered exceeds the amount
available at that time, the shares of available Company stock will be allocated on a proportionate
basis with each Member receiving a number of shares equal to the number of shares available
multiplied by a fraction, the numerator of which is the number of shares such Member requested, and
the denominator of which is the total number of shares requested by all Members.

     The Plan Administrator, in its discretion may set a limit for the minimum number of shares
that must be purchased to participate in the offering. This amount shall be set by the Plan
Administator for administrative purposes.

     The Plan Administrator may limit the class of Members who shall be eligible to request the
purchase of Company stock at the time of any offering thereof, to those who are active Participants
in the Plan.

     8.3 Valuing Stock. When valuing Company stock for any purpose under this Plan,
except as otherwise specifically provided in section 8.2, the price of the Company stock, as
determined by an independent financial appraisal firm as of the last preceding Valuation Date for
which an appraisal has been issued before the effective date of any transfer, distribution,
withdrawal, or loan, shall be used in determining the equivalent cash value (for the purpose of an
investment transfer, distribution, withdrawal or loan) of Company stock shares.

     8.4 Crediting of Stock to Account. As of the end of each calendar quarter, the
Account (or appropriate subaccount) of each Member shall be credited with the value of shares of
Company stock, adjusted for appreciation or depreciation as determined by an independent financial
appraisal firm.

     8.5 Dividends. As of the end of each calendar quarter, any cash stock dividend
declared during such calendar quarter shall be invested on the Member’s behalf in accordance with
the Member’s current investment directive in effect under section 7.3.

     8.6 Transfers From Company Stock Investment Fund. A Member may transfer assets held
in the Company stock Investment Fund to one or more other Investment Funds as described in section
7.1, based upon the equivalent cash value of the Company stock described in section 8.3.

     8.7 Distributions and Stock. In the event of a distribution under Article VI, such
shares of Company stock used as the source of the distribution shall be converted to cash, based on
the value of said stock as described in section 8.3.

51

 

     8.8 Withdrawals of Company Stock. In the event of a permissible withdrawal under
section 6.6, such shares of Company stock used as the source of the withdrawal shall be converted
to cash, based on the value of said stock as described in section 8.3.

     8.9 Loans and Stock. In the event of a loan under section 6.7, such shares of
Company stock used as the source of the loan shall be converted to cash, based on the value of said
stock as described in section 8.3.

     Repayments of the loan shall not be invested in Company stock, but shall be invested as
described in section 6.7(j)—that is, based upon the borrower’s current investment election under
section 7.1.

     8.10 Voting of Stock.

	 	(a)	 	Prior to each meeting of stockholders of the Company, each
Member will be furnished any proxy material relating to such meeting, together
with a form to be sent to the Trustee on which may be set forth the Member’s
instructions as to the manner of voting the shares of Company stock then held
by the Trustee under the Plan to the extent of the Member’s proportionate
interest therein. Upon receipt of such instructions, the Trustee shall vote
such shares in accordance therewith.
	 
	 	(b)	 	If, within such reasonable period of time prior to such
stockholders’ meeting as may be specified by the Trustee, no instructions have
been received by the Trustee from a Member, the Trustee shall vote
such shares, in person or by proxy, in accordance with the voting instructions
received from a majority of the Members for which it holds shares.

     8.11 Tender Offers. As soon as practicable after being informed of the commencement
of a tender offer or exchange offer (“Offer”) for shares of Company stock, the Company shall use
reasonable best efforts to cause each Member, whose Account has credited to it any shares of
Company stock, to be advised in writing of the terms of the Offer, together with forms by which the
Member may instruct the Trustee, or revoke such instruction, to tender shares credited to his
Account, to the extent permitted under the terms of any such Offer. The Trustee shall follow the
directions of each Member but the Trustee shall not tender such shares for which no instructions
are received. The number of shares of Company stock with respect to which a Member may provide
instructions shall be the total number of shares of Company stock credited to the Member’s Account,
whether or not the shares are vested, as of the last Valuation Date for which an appraisal has been
issued before the month during which the Offer commenced or such other date which may be designated
by the Company, in its sole discretion, as it deems appropriate for reasons of administrative
convenience. The giving of the instructions to the Trustee to tender shares and the tender thereof
shall not be deemed a withdrawal or suspension from the Plan or a forfeiture of any portion of the
Member’s interest in the Plan. Any securities received by the Trustee as a result of a tender of
shares

52

 

of Company stock hereunder shall be held, and any cash so received shall be invested in
short-term investments, for the account of each Member with respect to whom shares of Company stock
were tendered pending any reinvestment by the Trustee, as it may deem appropriate, consistent with
the purposes of the Plan, or in any investment option of the Plan as the Member may direct under
the terms of the Plan.

Article IX. Accounts and Records of the Plan

     9.1 Accounts and Records. The Accounts and records of the Plan shall be maintained
by the Plan Administrator and shall accurately disclose the status of the Accounts of each Member
or his Beneficiary in the Plan.

     Each Member shall be advised from time to time, at least once during each Plan Year, as to the
status of his Account.

     9.2 Trust Fund. Each Member shall have an undivided proportionate interest in the
Trust Fund which shall be measured by the proportion that the value of his Account bears to the
total value of all Accounts as of the date that such interest is being determined.

     9.3 Valuation and Allocation of Expenses. As of each Valuation Date, the Plan
Administrator, with the assistance of the Trustee, shall determine the fair market value of the
Trust Fund after first deducting any expenses which have not been paid by the Employers and the
Members. Unless paid by the Employers, all reasonable costs and expenses incurred in connection
with the general administration of the Plan and Trust shall be chargeable to the Trust Fund.
Administrative expenses incurred in connection with the processing of any loan, distribution or
withdrawal, other than a distribution pursuant to a qualified domestic relations order, shall be
charged to the Member’s or Beneficiary’s Account from which the loan or distribution is made.

     9.4 Allocation of Earnings and Losses. As of each Valuation Date, the Plan
Administrator, with the assistance of the Trustee, shall allocate the net earnings and gains or
losses of each Investment Fund of the Trust Fund since the preceding Valuation Date to each
Member’s Account in the same proportion that the value of his Account invested in such Investment
Fund bears to the total value of all Accounts invested in such Investment Fund; and, for this
purpose, the Plan Administrator shall adopt uniform rules which conform to generally accepted
accounting practices. The foregoing shall not apply to the loan fund which shall be accounted for
separately such that interest on a Member’s loan is credited solely to such Member’s Account.

Article X. Financing

     10.1 Financing. The Company shall enter into a Trust Agreement in order to implement
and carry out the provisions of the Plan and to finance the benefits under the Plan. All rights
which may accrue to any person under the Plan shall be subject to all the terms and provisions of
such Trust Agreement, except to the extent any term or provision

53

 

of such Trust Agreement may conflict with the terms of the Plan. The Company may modify the
Trust Agreement from time to time to accomplish the purposes of the Plan.

     10.2 Contributions. The Employers shall make such contributions to the Trust Fund as
are required by the provisions of the Plan, subject to the right of the Company to discontinue the
Plan at any time and for any reason.

     10.3 Nonreversion. No Employer shall have any right, title, or interest in the
contributions made to the Trust Fund, and no part of the Trust Fund shall revert to any Employer,
except that if a contribution is made to the Trust Fund by an Employer by a mistake of fact, then
such contribution may be returned to such Employer within one year after the payment of the
contribution; and if any part or all of a contribution is disallowed as a deduction under Code
section 404 (and the Employer hereby conditions all contributions upon deductibility under the
Code), then to the extent such contribution is disallowed as a deduction it will be returned to
such Employer within one year after the disallowance.

     10.4 Rights in the Trust Fund. Persons eligible for benefits under the Plan are
entitled to look only to the Trust Fund for the payment of such benefits and have no claim against
any Employer, the Plan Administrator, or any other person. No person has any right or interest in
the Trust Fund except as expressly provided in the Plan.

Article XI. Committee and Administration

     11.1 Committee. The Board may appoint a Committee of three or more members, to hold
office at the pleasure of the Board, for the purpose of administering the Plan. If so appointed,
the Committee shall be the “plan administrator” of the Plan in accordance with ERISA (the “Plan
Administrator”), and shall be a fiduciary under the Plan and Trust Agreement and a named fiduciary
in accordance with ERISA. Provided, however, that should the Board not appoint a Committee as
provided herein, or if at any time all the Committee seats are vacant due to resignation, death or
removal of all Committee members, the Company shall constitute the Plan Administrator and named
fiduciary and shall have all of the powers and duties herein otherwise conferred upon the
Committee.

     11.2 Organization. The Committee shall choose from its members a chairman and a
secretary. The secretary shall keep minutes of the Committee’s proceedings and shall keep all
dates, records, and documents pertaining to the Committee’s administration of the Plan. The
Committee may employ and suitably compensate such attorneys and advisors and such clerical and
other services as it may deem necessary in the performance of its duties.

     11.3 Manner of Action. A majority of the members of the Committee at the time in
office shall constitute a quorum for the transaction of business. Action of the Committee at any
meeting shall be determined by the vote of a majority of those members present at such meeting.
Upon the written concurrence of a majority of the members at the time in office, action of the
Committee may be taken without a meeting.

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Either the chairman or the secretary may execute any certificate or other written direction on
behalf of the Committee.

     11.4 Self-Interest. A member of the Committee who is also a Member shall not vote on
any question relating specifically to himself.

     11.5 Compensation and Expenses.

	 	(a)	 	A member of the Committee shall serve without compensation for his
services as such if he is an Employee; however, he may receive reimbursement
of expenses properly and actually incurred.
	 
	 	(b)	 	All reasonable expenses of the Plan Administrator, the Committee or
a member of the Committee which are properly and actually incurred shall be
chargeable to the Trust Fund as administrative expenses unless paid by the
Employers.

     11.6 Powers. The Plan Administrator, on behalf of the Members, shall enforce the
Plan in accordance with the terms of the Plan and Trust Agreement and shall have all powers
necessary and the sole and absolute discretion to accomplish that purpose including, but not by way
of limitation, the following:

	 	(a)	 	to determine conclusively all questions of fact, including those
relating to the eligibility of Employees to become Participants;
	 
	 	(b)	 	to compute and certify to the Trustee the amount and kind of
benefits payable to Members;
	 
	 	(c)	 	to authorize all disbursements by the Trustee from the Trust Fund;
	 
	 	(d)	 	to discuss the investment of the Trust Fund with the Trustee;
	 
	 	(e)	 	to interpret conclusively the terms and provisions of the Plan;
	 
	 	(f)	 	to make and publish such uniform and nondiscriminatory rules for the
Plan as are not inconsistent with the provisions hereof; and
	 
	 	(g)	 	to make or cause to be made all reports and filings necessary to
meet its responsibilities under ERISA concerning reporting and disclosure
requirements.

     11.7 Information. To enable the Plan Administrator to perform its functions, the
Employers shall supply full and timely information to the Plan Administrator of all matters
relating to the compensation of all Members, their retirement, death, or other cause for
termination of employment, and such other pertinent facts as the Plan Administrator may require.
The Plan Administrator shall advise the Trustee of such of the foregoing facts as may be pertinent
to the Trustee’s duties.

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     11.8 Claim Procedure. If any person believes he is being denied any rights or
benefits under the Plan, such person (the “Claimant”) may file a claim in writing ( a “Claim”) with
the Committee, and the Committee will review and make a determination with respect to such Claim in
accordance with the following procedures:

	 	(a)	 	Claim not Involving Determination of Disability. If the Claim does
not require the Committee to make a determination regarding the existence of
a condition of disability (i.e., is not a “Disability Claim as hereinbelow
defined), the Committee will notify the Claimant of its determination within
90 days after the Claim was filed. If special circumstances require an
extension of time for processing the Claim, the 90-day period may be extended
to 180 days, in which case the Committee shall notify the Claimant within the
first 90 days, and the notice of extension shall state the circumstances
which require the extension and the date by which the Committee expects to
make a decision.
	 
	 	(b)	 	Claim Involving Determination of Disability. If the Claim requires
the Committee to make a determination regarding the existence of a condition
of disability (a “Disability Claim”), the Committee will notify the Claimant
of its determination within 45 days after the Claim was filed. If special
circumstances outside the control of the Committee require an extension of
time for processing the Claim, the 45-day period may be extended to 75 days,
in which case the Committee shall notify the Claimant within the first 45
days, and the notice of extension shall state the following:

	 	(1)	 	The circumstances which require the extension;
	 
	 	(2)	 	The date by which the Committee expects to make a
decision;
	 
	 	(3)	 	The standards on which the Claimant’s entitlement to
a benefit is based; and
	 
	 	(4)	 	The additional information needed to resolve those
issues.

	 	 	 	The Claimant will be given at least 45 days to provide any additional
information requested in the notice of extension. If necessary due to
circumstances outside the control of the Committee, the Committee may
extend the period for making the decision for an additional 30 days, by
notifying the Claimant in the same manner before the end of the initital
30-day period.
	 
	 	(c)	 	Notice of Denial of Claim. If any Claim is wholly or partially
denied, the Committee will notify the Claimant of its decision in

56

 

	 	 	 	writing. Such notification will be written in a manner calculated to be
understood by such person and will contain:

	 	(1)	 	The specific reason or reasons for the denial;
	 
	 	(2)	 	Specific reference to the pertinent plan provisions
on which the denial is based;
	 
	 	(3)	 	A description of any additional material or
information, if any, the Claimant must provide in order to have a
valid Claim and an explanation of why such material or information is
necessary;
	 
	 	(4)	 	A description of the Plan’s review procedures and
the time limits that apply to those procedures, including a statement
of the Claimant’s right to file a lawsuit if the Claim is denied on
review; and
	 
	 	(5)	 	In the case of a denied Disability Claim, a copy of
any internal rule, guideline, protocol or similar guideline which the
Committee relied upon to reach its decision, or a statement that upon
request the Claimant will be provided such copy free of charge.

	 	(d)	 	Request for Review of Denied Claim. Within 60 days after the
Claimant receives notice of the Committee’s denial of a Claim, (180 days in
the case of a denied Disability Claim) the Claimant may appeal the decision
of the Committee by giving the Committee written notice requesting a review
of the Claim. The Committee will then review the Claim and make a decision
on it.
	 
	 	(e)	 	Access to Documents and Submission of Comments. A Claimant who
requests review of a denied Claim must be provided, free of charge, access
to, and copies of, all documents, records, and other information relevant to
the Claim (“Information”). Information is considered “relevant” to the claim
if it meets any of the following requirements:

	 	(1)	 	The Information was relied upon by the Committee in
reaching its decision; or
	 
	 	(2)	 	The Information was submitted to the Committee, or
considered by the Committee, or generated in the process of the
Committee reaching its decision; or
	 
	 	(3)	 	The Information demonstrates that the Committee
complied with administrative processes and safeguards that ensure

57

 

	 	 	 	that its decision was made in accordance with the Plan and that,
where appropriate, the Plan provisions have been applied
consistently to other individuals in similar circumstances; or

	 	(4)	 	The Information is a statement of policy or guidance
concerning the denial of Plan benefits for Disability with respect to
the Claimant’s medical diagnosis, whether or not the Committee relied
on this information in deciding the Claim.

	 	 	 	Prior to the review by the Committee, the Claimant and any representative
selected by the Claimant shall be given an opportunity to submit written
comments, documents, records and other information relating to the Claim.
	 
	 	(f)	 	Review of Claim. The Committee’s review of a denied Claim will take
into account all comments, documents, records and other information submitted
by or on behalf of the Claimant and relating to the Claim, whether or not the
information was submitted to the Committee or considered by it when the Claim
was initially denied.
	 
	 	(g)	 	Review of Denied Disability Claim. In reviewing a denied Disability
Claim, the Committee will consult with a health care professional who has
appropriate medical training and experience for purposes of making any
determination that is based in whole or in part on medical judgment. The
health care professional must not be an individual who was consulted by the
Committee in connection with the original denial of the Claim, or a
subordinate of such a person. The Committee will identify any medical or
vocational experts whose advice was obtained in connection with the denial of
the Claim, whether or not their advice was relied upon by the Committee.
	 
	 	(h)	 	Final Decision on Reviewed Claim. The Committee’s final decision on
review of a denied Claim shall be in writing. If the Claim is denied on
review, the written decision will provide the Claimant with the following
information:

	 	(1)	 	The specific reasons for the decision;
	 
	 	(2)	 	Reference to the specific Pan provisions on which
the decision is based;
	 
	 	(3)	 	A statement that the Claimant is entitled to
receive, on request, all Information relevant to the Claim
(determined
in accordance with subsection (e));

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	 	(4)	 	A statement of the Claimant’s right to file a
lawsuit under ERISA; and
	 
	 	(5)	 	In the case of a denied Disability Claim, a copy of
any internal rule, guideline, protocol or similar guideline which the
Committee relied upon to reach its decision, or a statement that upon
request the Claimant will be provided such copy free of charge.

	 	(i)	 	Time Period for Review of Denied Claim. The decision of the
Committee shall be made within 60 days after the date the Committee receives
the initial request for review, or 45 days in the case of a Disability Claim.
If special circumstances require an extension of the time for processing the
request for review, the 60-day period may be extended to 120 days (90 days in
the case of a Disability Claim). If the Committee decides an extension is
required, it shall notify the Claimant before the initial period for review
has expired, and the notification shall inform the Claimant of the
circumstances which require the extension, and the date by which the
Committee expects to reach a decision.
	 
	 	(j)	 	Request for Further Information. If the Committee extends the time
period for deciding a Claim or reviewing a denied claim due to the Claimant’s
failure to submit information needed for the decision, the notice of
extension will specify the information needed. The time period for the
Committee’s initial decision or decision on review (including the extension)
will be increased by the period from the date the notice of extension is sent
to the Claimant until the date on which the Claimant responds to the request
for additional information.

     11.9 Notice of Address. Each person entitled to benefits from the Trust Fund must
file with his Employer or the Plan Administrator, in writing, his post office address and each
change of post office address. Any communication, statement, or notice addressed to such a person
at his latest reported post office address will be binding upon him for all purposes of the Plan,
and neither the Plan Administrator nor any Employer or Trustee shall be obliged to search for or
ascertain his whereabouts.

     11.10 Application for Benefits and Data. All persons claiming benefits from the
Trust Fund must make application and furnish to the Plan Administrator or its designated agent such
documents, evidence, or information as the Plan Administrator or its designated agent considers
necessary or desirable for the purpose of administering the Plan. Each such person must furnish
such information promptly and sign such documents as the Plan Administrator or its designated agent
may require before any benefits become payable from the Trust Fund.

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     11.11 Indemnity for Liability. The Company shall indemnify each member of the
Committee against any and all claims, losses, damages, and expenses, including counsel fees,
incurred by the Committee and against any liability, including any amounts paid in settlement with
the Committee’s approval, arising from the member’s or Committee’s action or failure to act in
connection with the member’s or Committee’s duties and responsibilities under the Plan, except when
the same is judicially determined to be attributable to the gross negligence or willful misconduct
of such member. The Company shall also indemnify each of its officers, directors and employees in
the same manner as provided for members of the Committee, or of the Company if acting as Plan
Administrator under section 11.1, which have been delegated to or assumed by such individual.

     11.12 Effect of a Mistake. In the event of a mistake or misstatement as to the
eligibility or participation or Compensation of any Member, or the amount of payments made or to be
made to a Member or Beneficiary, the Plan Administrator shall, if possible, cause to be withheld or
accelerated or otherwise make adjustment of such amounts of payments as will in its sole judgment
entitle the Member or Beneficiary to the proper amount of payments under the Plan.

     11.13 Missing Persons. If the Plan Administrator shall be unable to locate a Member
or Beneficiary within two years after an Account becomes payable, the Plan Administrator may mail a
notice by registered mail to the last known address of such person outlining the following action
to be taken unless such person makes written reply to the Plan Administrator within 60 days from
the mailing of such notice: The Plan Administrator may direct that the amount of such Account shall
be treated as a Forfeiture for the current Plan Year; provided, however, that in the event of the
subsequent reappearance of such Member or Beneficiary prior to termination of the Plan, such
Forfeiture shall be restored to such Account. (Such restored Forfeiture shall be paid from current
Forfeitures to the extent they are sufficient, and thereafter from an additional Employer
contribution.)

     11.14 Appointment of Investment Manager. The Plan Administrator may appoint any
individual or entity which qualifies as an “investment manager” within the meaning of section 3(38)
of ERISA to serve as the investment manager of the Trust Fund. The investment manager, prior to
exercising its functions as such, shall acknowledge its fiduciary status with respect to the Plan
in writing.

     11.15 Allocation of Fiduciary Responsibility. The Plan Administrator shall be
responsible for the duties and obligations imposed upon it pursuant to the Plan and the Trust
Agreement, including, but not limited to, the administration of the Plan, the appointment of an
investment manager, and consultation with the Trustee as to the investment of the Trust Fund. The
Trustee shall be responsible for the duties and responsibilities assigned to it pursuant to the
Plan and the Trust Agreement; provided, however, that if an investment manager is appointed, the
Trustee shall be relieved of any and all liability for the acts or omissions of the investment
manager and shall not be under any obligation to invest or otherwise manage any asset of the Trust
Fund which is

60

 

subject to the management of the investment manager. The investment manager shall be
responsible for the investment of the portion of the Trust Fund subject to its management, in
accordance with the Trust Agreement. This section is intended to allocate to each fiduciary the
individual responsibility for the prudent execution of the functions assigned to it, and none of
such responsibilities or any other responsibilities shall be shared by two or more of the
fiduciaries unless such sharing is specifically called for by a provision of the Plan or the Trust
Agreement. Whenever one fiduciary is required by the Plan or the Trust Agreement to follow the
directions of another fiduciary, the two fiduciaries shall not be deemed to have been assigned a
shared responsibility. Rather, the giving of the directions shall be deemed to be the sole
responsibility of the fiduciary so charged, and the responsibility of the fiduciary receiving those
directions shall be to follow them insofar as such instructions are on their face proper under
applicable law.

     11.16 Agency. The Company and the Plan Administrator shall act as agent for each
Employer in the administration of the Plan.

Article XII. Amendment and Termination

     12.1 Amendment and Termination.

	 	(a)	 	The Company does hereby expressly and specifically reserve the sole
and exclusive right at any time and for any reason, and from time to time, by
action of its Board by resolution at a corporate meeting or by corporate
consent, to amend, modify, or terminate the Plan. The Company’s right of
amendment, modification, or termination as aforesaid shall not require the
assent, concurrence, or any other action by any other Employer,
notwithstanding that such action by the Company may relate in whole or in
part to persons in the employ of any Employer (including the Company).
	 
	 	(b)	 	While each Employer contemplates carrying out the provisions of the
Plan indefinitely with respect to its Employees, no Employer shall be under
any obligation or liability whatsoever to maintain the Plan for any minimum
or other period of time.
	 
	 	(c)	 	Upon any termination of the Plan in its entirety, or with respect to
any Employer, the Company shall give written notice thereof to the Trustee
and any Employer involved, and such termination shall be effective as of the
later to occur of the date specified in such notice or the date such notice
is delivered to the Trustee, subject to the provisions of the law.
	 
	 	(d)	 	Except as provided by law, upon any termination of the Plan, no
Employer with respect to whom the Plan is terminated (including the Company)
shall thereafter be under any obligation, liability, or responsibility
whatsoever to make any contribution or payment to the Trust Fund, the Plan,
any Member, any Beneficiary, or any

61

 

	 	 	 	other person, trust or fund whatsoever, for any purpose whatsoever under
or in connection with the Plan, regardless of whether or not such Employer
has theretofore made the payments provided for under section 10.2 or under
any other provision of the Plan.

     12.2 Limitations on Amendments. The provisions of this section are subject to and
limited by the following restrictions:

	 	(a)	 	No amendment shall operate either directly or indirectly to give any
Employer any interest whatsoever in any funds or property held by the Trustee
under the terms hereof, or to permit corpus or income of the Trust to be used
for or diverted to purposes other than the exclusive benefit of Members or
their Beneficiaries.
	 
	 	(b)	 	Except as otherwise permitted by law or regulations, no such
amendment shall have the effect of eliminating or reducing an early
retirement benefit or a retirement type subsidy or eliminating an optional
form of benefit with respect to benefits attributable to service before the
amendment.

     12.3 Effect of Bankruptcy and Other Contingencies Affecting the Employer. In the
event an Employer terminates its connection with the Plan, or in the event an Employer is
dissolved, liquidated, or shall by appropriate legal proceedings be adjudged a bankrupt, or in the
event judicial proceedings of any kind result in the involuntary dissolution of an Employer, the
Plan shall be terminated with respect to such Employer. The merger, consolidation, or
reorganization of an Employer, or the sale by it of all or substantially all of its assets, shall
not terminate the Plan if there is delivery to such Employer by the successor to such Employer or
by the purchaser of all or substantially all of its assets, a written instrument requesting that it
be substituted for the Employer and agreeing to perform all the provisions hereof which such
Employer is required to perform. Upon the receipt of said instrument, with the approval of the
Company, the successor or the purchaser shall be substituted for such Employer herein, and such
Employer shall be relieved and released from any obligations of any kind, character, or description
herein or in any trust agreement imposed upon it.

     12.4 Limitation on Employer Liability. The adoption of the Plan is strictly a
voluntary undertaking on the part of the Employers and shall not be deemed to constitute a contract
between the Employers and any Employee or Member, or to be consideration for, an inducement to or a
condition of the employment of any Employee. A Member, Employee, or Beneficiary shall not have any
right to retirement or other benefits except to the extent provided herein.

     12.5 Amendment of Vesting Schedule. If the Plan is amended to provide a different
vesting schedule, each person adversely affected—

	 	(a)	 	who is a Participant during the election period below; and

62

 

	 	(b)	 	who has completed at least three years of Service may elect to have
such amendment disregarded in determining the vested percentage of his
Employer Profit Sharing and Matching Contributions Accounts. That election
must be in writing and delivered to the Plan Administrator

within the election period. Upon delivery, his election will be irrevocable. The election period
begins on the date such amendment is adopted and ends 60 days after the latest of the date—

	 	(1)	 	the amendment is adopted;
	 
	 	(2)	 	the amendment becomes effective; or
	 
	 	(3)	 	the Plan Administrator delivers a written notice of the amendment to
the Participant.

No amendment to the Plan’s vesting schedule may decrease the vesting which any Member has earned as
of the date of the amendment.

Article XIII. Miscellaneous

     13.1 Beneficiary Designation

	 	(a)	 	Each unmarried Member may designate, on a form provided for that
purpose by the Plan Administrator, a Beneficiary or Beneficiaries to receive
his interest in the Plan in the event of his death, but such designation
shall not be effective for any purpose until it has been filed by him during
his lifetime with the Plan Administrator. He may, from time to time during
his lifetime, on a form approved by and filed with the Plan Administrator,
change his Beneficiary or Beneficiaries. In the event that he fails to
designate a Beneficiary, or if for any reason such designation shall be
legally ineffective, or if all designated Beneficiaries predecease him or die
simultaneously with him, distribution shall be made to his spouse; or if
none, to his children; or if none, to his parents; or if none, to his estate.
If any such Beneficiary shall die prior to receiving the distribution that
would have been made to such Beneficiary had such Beneficiary’s death not
occurred, then, for the purposes of the Plan, the distribution that would
have been received by such Beneficiary shall be made to such Beneficiary’s
estate.
	 
	 	(b)	 	The Beneficiary of each Member who is married shall be the surviving
spouse of such Member, unless such spouse consents in writing to the
designation of another Beneficiary or Beneficiaries. Each married Member may,
from time to time, change his

63

 

	 	 	 	designation of Beneficiary; provided, however, that the Member may not
change his Beneficiary without the written consent of his spouse, unless
such spouse’s prior consent expressly permits designations by the Member
without any requirement of further consent by the spouse.
	 
	 	(c)	 	The written consent described in subsection (b) of this section
shall acknowledge the effect of such election and shall be witnessed by a
Plan representative designated by the Plan Administrator or a notary public.
	 
	 	(d)	 	Notwithstanding the foregoing, the spouse’s consent to the
designation or change of designation of a Beneficiary by a Member shall not
be required if it is established to the satisfaction of the Plan
Administrator that the consent may not be obtained because there is no
spouse, because the spouse cannot be located, or because of such other
circumstances as the Secretary of the Treasury may by Regulations prescribe.
	 
	 	(e)	 	If a Member’s interest is required to be distributed to more than
one Beneficiary, then unless otherwise provided in the Member’s designation
of Beneficiaries, the Member’s interest shall be divided among the
Beneficiaries in equal shares (or such other proportionate shares as may be
specified in the designation of Beneficiaries) and a separate Account shall
be established for each such Beneficiary with respect to the Beneficiary’s
share until such share has been entirely distributed to the Beneficiary. To
the extent permitted under applicable Regulations and the Plan, each
Beneficiary shall be entitled to elect any form of distribution or other
option provided by the Plan with respect to the Beneficiary’s separate
Account, without the consent of any other Beneficiary.

     13.2 Incompetency. Whenever and as often as any person entitled to receive a
distribution under the Plan shall be under a legal disability or, in the sole judgment of the Plan
Administrator, shall otherwise be unable to care for such distributions to his own best interest
and advantage, the Plan Administrator, in the exercise of its discretion, may direct such
distributions to be made in any one or more of the following ways:

	 	(a)	 	directly to such person;
	 
	 	(b)	 	to his spouse;
	 
	 	(c)	 	to his legal guardian or conservator; or
	 
	 	(d)	 	any other person to be held and used for his benefit.

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The decision of the Plan Administrator shall, in each case, be final and binding upon all parties,
and any distribution made pursuant to the power herein conferred on the Plan Administrator shall,
to the extent so made, be a complete discharge of the obligations under the Plan of the Employers,
the Trustee, and the Plan Administrator in respect of such person.

     13.3 Nonalienation. Except as provided in Code section 401(a)(13), no benefit
payable at any time under the Plan shall be subject in any manner to alienation, sale, transfer,
assignment, pledge, attachment, garnishment, or encumbrance of any kind. Any attempt to alienate,
sell, transfer, assign, pledge, or otherwise encumber any such benefit, whether presently or
thereafter payable, shall be void. No benefit nor the Trust Fund shall in any manner be liable for
or subject to the debts or liabilities of any Member or of any other person entitled to any
benefit. The Plan Administrator shall establish procedures to determine whether domestic relations
orders are “qualified domestic relations orders” and to administer distributions under such
qualified domestic relations orders.

     After September 22, 1993, if a Domestic Relations Order is presented to the Plan and is
determined to be a “Qualified Domestic Relations Order,” and if such Order provides for
distribution to an Alternate Payee of such Alternate Payee’s entire interest under the Order in a
single lump sum as of any Valuation Date, the Plan shall make such distribution on or as soon as
administratively feasible after such specified Valuation Date. Except as otherwise provided in the
preceding sentence, distribution of benefits to an Alternate Payee pursuant to a Qualified Domestic
Relations Order shall be made only at such time and in such manner as may be permitted by the Plan
and by applicable provisions of ERISA and the Code. For purposes of this section, the terms
“Domestic Relations Order,” “Qualified Domestic Relations Order,” and “Alternate Payee” shall have
the meanings given to such terms by Code section 414(p).

     13.4 Employment Rights. An Employer’s right to discipline or discharge its Employees
shall not be affected by reason of any of the provisions of the Plan.

     13.5 Applicable Law. The Plan and all rights hereunder shall be governed by and
construed in accordance with the laws of Montana and of the United States of America.

     13.6 Participation in the Plan by an Affiliate. Any Affiliate which desires to
become an Employer may, with the approval of the Board and subject to such terms and conditions as
the Board may prescribe, adopt the Plan and Trust Agreement. In addition, any company which is not
an Affiliate may become an adopting employer with respect to its own employees, with the approval
of the Board and subject to such terms and conditions as the Board may prescribe.

     13.7 Merger, Consolidation, or Transfer. In the case of any merger or consolidation
of the Plan with, or in the case of any transfer of assets or liabilities of the Plan to or from,
any other plan, each Member shall receive a benefit immediately after the merger, consolidation, or
transfer (if the Plan had then terminated) which is equal to or greater than the benefit he would
have been entitled to receive immediately before the
merger, consolidation, or transfer (if the Plan had then terminated), and any protected
benefit under Code section 411(d)(6) shall be preserved.

65

 

     13.8 Veterans’ Reemployment Rights. Notwithstanding any provision of the Plan to the
contrary, contributions, benefits and service credit with respect to qualified military service
will be provided in accordance with Code section 414(u).

Article XIV. Top-Heavy Provisions

     14.1 Application of Top-Heavy Provisions

	 	(a)	 	Single Plan Determination. Except as provided in subsection (b)(2)
below, for Plan Years beginning January 1, 1984, if as of a Determination
Date, the sum of the amount of the section 416 Accounts of Key Employees and
the Beneficiaries of deceased Key Employees exceeds 60 percent of the amount
of the section 416 Accounts of all Members and Beneficiaries other than
former Key Employees, the Plan is top-heavy and the provisions of this
Article will become applicable.
	 
	 	(b)	 	Aggregation Group Determination.

	 	(1)	 	If as of a Determination Date this Plan is part of an
Aggregation Group which is top-heavy, the provisions of this Article will
become applicable. Top-heaviness for the purpose of this subsection will be
determined with respect to the Aggregation Group in the same manner as
described in subsection (a) above except that if the Aggregation Group
includes a defined benefit plan, the section 416 Account will include the
present value of the accrued benefit of a participant or a beneficiary under
that plan.
	 
	 	(2)	 	If this Plan is top-heavy under subsection (a) above, but the
Aggregation Group is not top-heavy, this Article will not be applicable.

	 	(c)	 	Responsibility. The Plan Administrator shall have responsibility to
make all calculations to determine whether this Plan is top-heavy.

     14.2 Definitions.

	 	(a)	 	“Aggregation Group” means this Plan and all other plans maintained
by the Company and Affiliates which cover a Key Employee and any other plan
that enables a plan covering a Key Employee to meet the requirements of Code
sections 401(a)(4) or 410. In addition, at the election of the Plan
Administrator, the Aggregation Group may be expanded to include any other
qualified plan maintained by the Company or an Affiliate if the
expanded Aggregation Group meets the requirements of Code sections
401(a)(4) and 410.

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	 	(b)	 	“Determination Date” means the last day of the Plan Year immediately
preceding the Plan Year for which top-heaviness is to be determined, or in
the case of the first Plan Year of a new plan, the last day of such Plan
Year.
	 
	 	(c)	 	“Key Employee” means an Employee or former Employee (including any
deceased Employee) who at any time during the plan year that includes the
Determination Date was an officer of the Employer having annual Section 415
Compensation greater than $130,000 (as adjusted under section 416(i)(1) of
the Code for Plan Years beginning after December 31, 2002), a 5-percent owner
of the Employer, or a 1-percent owner of the Employer having annual Section
415 Compensation of more than $150,000. The determination of who is a Key
Employee will be made in accordance with Code Section 416(i)(1) and the
applicable Regulations and other guidance of general applicability issued
thereunder. Any Member who is not a Key Employee shall be a “non-Key
Employee” for purposes of this Article XIV.
	 
	 	(d)	 	“Section 416 Account” means—

	 	(1)	 	the amount credited to a Member’s or Beneficiary’s Account
under the Plan or to an account under any other qualified defined contribution
plan which is part of an Aggregation Group as of a Determination Date; plus
	 
	 	(2)	 	the present value of the accrued benefit credited to a Member
or Beneficiary under a qualified defined benefit plan which is part of the
Aggregation Group; and
	 
	 	(3)	 	the amount of distributions to the Member or Beneficiary
during the one-year period ending on a Determination Date other than a
distribution which is a tax-free rollover contribution (or similar transfer)
that is not initiated by the Member or that is contributed to a plan which is
maintained by the Company or an Affiliate (except that in the case of a
distribution made for a reason other than separation from employment, death,
or disability, this provision shall be applied by substituting “5-year period”
for “1-year period); reduced by
	 
	 	(4)	 	the amount of rollover contributions (or similar transfer)
and earnings thereon credited as of a Determination Date under the Plan or a
plan forming part of an Aggregation Group which is attributable to rollover
contributions (or similar transfer) initiated
by the Member and derived from plans not maintained by the Company or an
Affiliate.

67

 

	 	 	 	The Account of a Member who was a Key Employee and who subsequently meets
none of the conditions of section 14.2(c) for the Plan Year containing the
Determination Date and the preceding four Plan Years is not a Section 416
Account and will be excluded from all computations under this Article.
Furthermore, if a Member has not performed any services for the Company or
an Affiliate during the one-year period ending on the Determination Date,
any account of such Member (and any accrued benefit of such Member) shall
not be taken into account in computing top-heaviness under this Article.

     14.3 Minimum Contribution.

	 	(a)	 	General. If this Plan is determined to be top-heavy under the
provisions of section 14.1 with respect to a Plan Year, the sum of Employer
Profit Sharing and Matching Contributions and Forfeitures allocated under the
Plan to the account of each Active Participant (as defined in section 14.5)
who is not a Key Employee and who is otherwise eligible for such an
allocation under the provisions of sections 4.2 and 4.3(b) of the Plan,
together with employer contributions (other than pay reduction contributions)
and forfeitures allocated to the accounts of the Participant under all other
qualified defined contribution plans in the Aggregation Group, will not be
less than 3 percent of the Active Participant’s compensation (as defined in
Regulation section 1.415-2(d)). This section will not apply to a Participant
who is also covered under a top-heavy defined benefit plan maintained by the
Company or an Affiliate which provides the benefit specified by Code section
416(c)(1).
	 
	 	(b)	 	Exception. The contribution rate specified in subsection (a) above
will not exceed the percentage at which employer contributions (including pay
reduction contributions) and forfeitures are allocated under the defined
contribution plans of the Aggregation Group to the account of the Key
Employee for whom such percentage is the highest for the Plan Year. For the
purpose of this subsection, the percentage for each Key Employee will be
determined by dividing the employer contributions and forfeitures for the Key
Employee by the amount of his compensation (as defined in Treasury Regulation
section 1.415-2(d)) for the year.

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     14.4 Active Participant. For the purpose of this Article XIV, an “Active
Participant” shall mean any Participant regardless of whether such Active Participant is
employed on the last day of the top-heavy Plan Year, and regardless of whether such Active
Participant made Before-Tax contributions during the top-heavy Plan Year.

* * * * * * * * * *

     In Witness Whereof, the authorized officers of the Company have signed this document on
December ___, 2005, effective as of January 1, 2006, or such other dates as set forth herein or
required by law.

	 	 	 	 	 	 	 
	 	 	First Interstate BancSystem, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	ROBERT A. JONES	 	 
	 

	 	 	 	Executive Vice President	 	 
	 

	 	 	 	Chief Administrative Officer	 	 

69

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