Document:

exv10w43

Exhibit 10.43

ADVISORY AND NON-COMPETITION AGREEMENT AMENDMENT

     This Advisory and Non-Competition Agreement Amendment (this “Amendment”), dated as of November
24, 2008, is by and between Toll Brothers, Inc. (the “Company”) and Bruce E. Toll (“BET”). This
Amendment amends the Advisory and Non-Competition Agreement, dated as of November 1, 2004 and
previously amended as of June 17, 2007, by and between the Company and BET (as amended, the
“Advisory Agreement”). Capitalized terms used herein and not defined herein shall have the
meanings assigned to such terms in the Advisory Agreement.

     WHEREAS, BET, a founder of the Company, was employed by the Company for many years as its
President, Chief Operating Officer and Secretary and in various capacities with respect to the
Company’s subsidiaries, and, more recently, has been and continues to be retained under the
Advisory Agreement.

     WHEREAS, the Company now deems it advisable to amend the Advisory Agreement to ensure that
payments made to BET thereunder are in compliance with changes made to the tax laws by the addition
to the Internal Revenue Code of 1986, as amended (the “Code”), of Section 409A by the American Jobs
Creation Act of 2004.

     NOW, therefore, in consideration of the mutual obligations and promises contained herein, and
intending to be legally bound, Company and BET hereby agree as follows:

     1. The following sentence is hereby added to the end of Paragraph 5(a) of the Advisory
Agreement:

“Notwithstanding the foregoing, payments otherwise required to be made
to BET pursuant to this Paragraph 5(a) at any time during the fist six
months following the Termination Date shall be delayed until six
months have elapsed following such Termination Date if, and to the
extent, required to comply with Section 409A(a)(2)(B)(i) of the Code
(as hereinafter defined). The aggregate amount of any payments so
delayed shall be paid to BET in a lump sum as soon as practicable
after six months have elapsed following the Termination Date
Thereafter, any payments required to be made to BET pursuant to this
Paragraph 5(a) shall be made in the same manner as payments are to be
made pursuant to Paragraph 3 hereof.”

     2. In all other respects, the Advisory Agreement is continued in full force and effect.

[SIGNATURE PAGE IMMEDIATELY FOLLOWS]

 

 

     IN WITNESS WHEREOF, with the intention of being legally bound, BET and the Company hereby
execute this Agreement as of the date first set forth above.

	 	 	 	 	 	 	 
	 	 	TOLL BROTHERS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Joel H. Rassman
	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Joel H. Rassman	 	 
	 

	 	Title:
	 	Executive Vice President and	 	 
	 

	 	 
	 	Chief Financial Officer	 	 
	 
	 	 	 	 	 	 
	 	 	/s/ Bruce E. Toll	 	 
	 	 	 	 	 
	 	 	BRUCE E. TOLL	 	 

- 2 -exv10w45

Exhibit 10.45

TOLL BROS., INC.

NONQUALIFIED DEFERRED COMPENSATION PLAN

Amended and Restated effective as of November 1, 2008

RECITALS

     This Toll Bros., Inc. Nonqualified Deferred Compensation Plan (the “Plan”) is adopted by Toll
Bros., Inc., a Pennsylvania Corporation (the “Employer”) for certain of its eligible employees.
The purpose of the Plan is to offer those employees an opportunity to elect to defer the receipt of
compensation in order to provide deferred compensation, post- employment, supplemental retirement
and related benefits taxable pursuant to Section 451 of the Internal Revenue Code of 1986, as
amended (the “Code”), and to provide a deferred compensation vehicle to which the Employer may
credit certain amounts on behalf of participants. The Plan is intended to be a “top-hat” plan
(i.e., an unfunded deferred compensation plan maintained for a select group of management or
highly- compensated employees) under Sections 201(2), 301(a)(3) and 401(a)(1) of the Employee
Retirement Income Security Act of 1974 (“ERISA”).

ARTICLE 1

DEFINITIONS

	1.1	 	409A BENEFIT means any portion of a Participant’s Account that is attributable to deferrals
that were or are made after December 31, 2004, that first became or becomes vested after
December 31, 2004, or otherwise is determined to be subject to Code Section 409A.
	 
	1.2	 	ACCOUNT means the balance credited to a Participant’s or Beneficiary’s Plan account,
including amounts credited under the Compensation Deferral Account and the Employer
Contribution Credit Account and deemed income, gains and losses (as determined by the
Employer, in its discretion) credited thereto. A Participant’s or Beneficiary’s Account shall
be determined as of the date of reference.
	 
	1.3	 	BENEFICIARY means any person or persons so designated in accordance with the provisions of
Article 7.
	 
	1.4	 	BOARD means the Board of Directors of Toll Bros., Inc., a Pennsylvania corporation, and its
successors and assigns, or any other corporation or business organization which, with the
consent of Toll Bros., Inc., or its successors or assigns, assumes the obligations of Toll
Bros., Inc., hereunder.
	 
	1.5	 	CHANGE IN CONTROL means a transaction or series of transactions occurring after the Effective
Date, which results in one of the following events: (i) Toll Bros., Inc. is no longer a
subsidiary of Toll Brothers, Inc.; (ii) the consummation of a plan or other arrangement
pursuant to which Toll Brothers, Inc. will be dissolved or liquidated; (iii) the consummation
of a sale or other disposition of all or substantially all of the assets of Toll

1

 

	 	 	Brothers, Inc.; (iv) the consummation of a merger or consolidation of Toll Brothers, Inc.
(either directly or through a wholly-owned subsidiary) with or into another corporation, other
than, in either case, a merger or consolidation of Toll Brothers, Inc. in which holders of
shares of the Toll Brothers, Inc.’s common stock immediately prior to the merger or
consolidation will hold at least a majority of the ownership of common stock of the surviving
corporation (and, if one class of common stock is not the only class of voting securities
entitled to vote on the election of directors of the surviving corporation, a majority of the
voting power of the surviving corporation’s voting securities) immediately after the merger or
consolidation, which common stock (and, if applicable, voting securities) is to be held in the
same proportion as such holders’ ownership of Toll Brothers, Inc. common stock immediately
before the merger or consolidation; (v) the date any entity, person or group, (within the
meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of 1934, as
amended), (other than (A) Toll Brothers, Inc. or any of its subsidiaries or any employee benefit
plan (or related trust) sponsored or maintained by Toll Brothers, Inc. or any of its
subsidiaries or (B) any person who, on the date the Plan is effective, shall have been the
beneficial owner of at least fifteen percent (15%) of the outstanding Toll Brothers, Inc. common
stock), shall have become the beneficial owner of, or shall have obtained voting control over,
more than fifty percent (50%) of the outstanding shares of Toll Brothers, Inc. common stock; or
(vi) the first day after the date this Plan is effective when directors are elected such that a
majority of the Board of Directors of Toll Brothers, Inc. shall have been members of the Board
of Directors of Toll Brothers, Inc. for less than twenty-four (24) months, unless the nomination
for election of each new director who was not a director at the beginning of such twenty-four
(24) month period was approved by a vote of at least two-thirds of the directors then still in
office who were directors at the beginning of such period.
	 
	1.6	 	CODE means the Internal Revenue Code of 1986 and the regulations thereunder, as amended from
time to time.
	 
	1.7	 	COMMON STOCK means Toll Brothers, Inc.’s voting common stock.
	 
	1.8	 	COMPENSATION means the total current cash remuneration, including regular salary, bonus
payments, sales bonus compensation, profit sharing distributions and other compensation as
defined by the Plan Committee and paid by the Employer to an Eligible Employee with respect to
his or her service for the Employer (as determined by the Employer, in its discretion).
	 
	1.9	 	COMPENSATION DEFERRALS are defined in Section 3.1(a).
	 
	1.10	 	COMPETITION means the Employer’s reasonable determination that the Participant has (i)
engaged in, become interested in, directly or indirectly, as a sole proprietor, as a partner
in a partnership, or as a substantial shareholder in a corporation, or become associated with,
in the capacity of an employee, director, officer, principal, agent, trustee or in any other
capacity whatsoever, any enterprise conducted in the geographic area of the business of the
Employer which enterprise is, or may be deemed to be, competitive with any business carried on
by Toll Brothers, Inc. and its subsidiaries; (ii) solicited, induced or attempted to induce,
in connection with any business competitive with that of Toll Brothers, Inc. and its
subsidiaries,

2

 

	 	 	any customers or employees of Toll Brothers, Inc. and its subsidiaries to curtail or discontinue
their relationship with Toll Brothers, Inc. and its subsidiaries; or (iii) disclosed,
communicated or misused, to the detriment or injury of Toll Brothers, Inc. and its subsidiaries,
any confidential and proprietary information relating to the business and operations of Toll
Brothers, Inc. and its subsidiaries to any person or entity not associated with Toll Brothers,
Inc. and its subsidiaries.
	 
	1.11	 	DEFERRAL ELECTION FORM means the form or forms on which a Participant elects to defer
Compensation hereunder and on which the Participant makes certain other designations as
required thereon.
	 
	1.12	 	DESIGNATION DATE means the date or dates as of which a designation of deemed investment
directions by an individual pursuant to Section 4.5, or any change in a prior designation of
deemed investment directions by an individual pursuant to Section 4.5, shall become effective.
The Designation Dates in any Plan Year shall only be the first day of any calendar month as
designated by the Plan Committee.
	 
	1.13	 	EFFECTIVE DATE means the effective date of the Plan, which shall be November 15, 2001.
	 
	1.14	 	ELIGIBLE EMPLOYEE means, for any Plan Year (or applicable portion thereof), a person employed
by the Employer where compensation is paid on a United States payroll, who is determined by
the Plan Committee in its sole discretion to be a member of a select group of management or
highly compensated employees eligible to participate in the Plan. By each November 1, the
Plan Committee shall notify those individuals, if any, who will be Eligible Employees for the
next Plan Year. If the Plan Committee determines that an individual first becomes an Eligible
Employee during a Plan Year, the Plan Committee shall notify such individual of its
determination and of the date during the Plan Year on which the individual shall first become
an Eligible Employee.
	 
	1.15	 	EMPLOYER means Toll Bros., Inc., a Pennsylvania corporation, and its successors and assigns
unless otherwise herein provided, or any other corporation or business organization which,
with the consent of Toll Bros., Inc., or its successors or assigns, assumes the Employer’s
obligations hereunder, and any other corporation or business organization which agrees, with
the consent of Toll Bros., Inc., to become a party to the Plan.
	 
	1.16	 	EMPLOYER CONTRIBUTION CREDIT ACCOUNT is defined in Section 3.2.
	 
	1.17	 	EMPLOYER CONTRIBUTION CREDITS is defined in Section 3.2.
	 
	1.18	 	ENTRY DATE with respect to an individual means 30 days following the date on which the
individual first becomes an Eligible Employee.
	 
	1.19	 	FORM AND TIMING OF PAYMENT ELECTION FORM means the form or forms on which a Participant
elects the form and timing of the Participant’s Plan benefit.

3

 

	1.20	 	PARTICIPANT means any person so designated in accordance with the provisions of Article 2,
including, where appropriate according to the context of the Plan, any former employee who is
or may become eligible to receive a benefit under the Plan.
	 
	1.21	 	PLAN means this Toll Bros., Inc. Nonqualified Deferred Compensation Plan set forth herein, as
amended from time to time.
	 
	1.22	 	PLAN COMMITTEE refers to the officers and employees of the Employer appointed by the Board to
administer the Plan on behalf of the Employer.
	 
	1.23	 	PLAN YEAR means the twelve (12) month period ending on December 31 of each year during which
the Plan is in effect.
	 
	1.24	 	RETIREMENT AGE with respect to any Participant means the date on which the Participant’s
equals or exceeds 61.
	 
	1.25	 	TOTAL AND PERMANENT DISABILITY means the classification of a Participant as “disabled”
pursuant to the group long term disability plan maintained by the Employer, or a successor to
such plan (or, if there is no such plan, as reasonably determined by the Employer).
	 
	1.26	 	TRUST means the Trust described in Article 11.
	 
	1.27	 	TRUSTEE means the trustee of the Trust described in Article 11.
	 
	1.28	 	VALUATION DATE means the last day of each Plan Year; the date of distribution; or any other
date that the Plan Committee, in its sole discretion, designates as a Valuation Date.

ARTICLE 2

ELIGIBILITY AND PARTICIPATION

	2.1	 	REQUIREMENTS. Every Eligible Employee on the Effective Date shall be eligible to become a
Participant on the Effective Date. Every other Eligible Employee shall be eligible to become
a Participant on the first Entry Date occurring on or after the date on which he or she
becomes an Eligible Employee. No individual shall become a Participant, however, if he or she
is not an Eligible Employee on the date his or her participation is to begin.
	 
	 	 	Participation in the Compensation Deferral portion of the Plan is voluntary. In order to
participate in that portion of the Plan, an otherwise Eligible Employee must make written
application in such manner as may be required by Section 3.1 and by the Employer and must agree
to make Compensation Deferrals as provided in Article 3.
	 
	 	 	Participation in the Employer Contribution Credit Account portion of the Plan is automatic.

4

 

	2.2	 	RE-EMPLOYMENT. If a Participant whose employment with the Employer is terminated is
subsequently re-employed, he or she shall become a Participant in accordance with the
provisions of Section 2.1.
	 
	2.3	 	CHANGE OF EMPLOYMENT CATEGORY. During any period in which a Participant remains in the
employ of the Employer but ceases to be an Eligible Employee, he or she shall not be eligible
to make Compensation Deferrals or to receive Employer Contribution Credits hereunder.

ARTICLE 3

CONTRIBUTIONS AND CREDITS

	3.1	 	PARTICIPANT CONTRIBUTIONS AND CREDITS.

	 	a)	 	COMPENSATION DEFERRALS. In accordance with rules established by the Employer, a
Participant may elect to defer Compensation which is due to be earned and which would
otherwise be paid to the Participant, as a percentage of Compensation or in any fixed
periodic dollar amounts designated by the Participant. Amounts so deferred will be
considered a Participant’s “Compensation Deferrals.” A Participant shall make such an
election with respect to the coming twelve (12) month period during the period beginning on
January 1 and ending on December 31 of each Plan Year following the initial Plan Year (or
during such other period as may be established by the Plan Committee) by completing and
delivering to the Plan Committee a Deferral Election Form in a form prescribed by the Plan
Committee. Should a Participant become newly eligible during a Plan Year, their election
will apply from the date of participation to the next December 31.
	 
	 	 	 	Compensation Deferrals shall be made through regular payroll deductions or through an
election by the Participant to defer the payment of a bonus, sales bonus compensation or
profit sharing distribution not yet payable to him or her at the time of the election, which
election shall be set forth on such Participant’s Deferral Election Form. Compensation
deferrals will be limited to the extent necessary to satisfy applicable tax withholding or
benefit plan contribution requirements. The participant may make an irrevocable election
during the Plan Year to cease contributions to the Plan with written notice given to the
Committee. The Participant will then be ineligible to return to the Plan until the next Plan
Year. The Participant may change his or her regular payroll deduction Compensation Deferral
amount as of, and by written notice delivered to the Plan Committee during the periods
described in the preceding paragraph, with such change being first effective for
Compensation to be earned following the next December 31.
	 
	 	 	 	Once made, a Compensation Deferral Election Form with respect to a payroll deduction
election shall continue in force indefinitely, until changed as provided above. A Deferral
Election Form with respect to deferrals of bonuses, sales bonus compensation, profit sharing
distribution proceeds, or other compensation payments shall continue in force only for the
Plan Year for which the Deferral Election Form is first effective. Compensation Deferrals
shall be deducted by the Employer from the pay of a deferring

5

 

	 	 	 	Participant and shall be credited to the Compensation Deferral Account of the deferring
Participant.
	 
	 	b)	 	PARTICIPANT COMPENSATION DEFERRAL ACCOUNT. There shall be established and maintained
by the Employer a separate Compensation Deferral Account in the name of each Participant to
which shall be credited or debited, as applicable: (a) amounts equal to the Participant’s
Compensation Deferrals; (b) amounts equal to any deemed earnings and/or losses (to the
extent realized, based upon deemed fair market value of the Compensation Deferral; and (c)
any withdrawals or distributions therefrom. A Participant shall at all times be 100%
vested in amounts credited to his or her Compensation Deferral Account.
	 
	 	c)	 	COMPLIANCE WITH CODE SECTION 409A. Notwithstanding anything to the contrary in this
Section 3.1, any election by a Participant to defer base compensation shall become
effective with respect to base compensation that is payable for services performed during a
Plan Year only if such election is filed prior to such deadline as is established by the
Plan Committee for such deferral elections, which in all cases shall be no later than
December 31 of the prior Plan Year, and any such deferral election shall become irrevocable
as of such deadline and may not thereafter be modified until December 31 of the Plan Year
following the Plan Year in which such election became irrevocable. Any election by a
Participant to defer an annual bonus that is determined by reference to the Employer’s
fiscal year shall be effective only if such election is filed prior to such deadline as is
established by the Plan Committee for such deferral elections, which in all cases shall be
no later than October 31 of the Employer’s prior fiscal year, and any such deferral
election shall become irrevocable as of such deadline and may not thereafter be modified
until October 31 of the Employer’s fiscal year following the fiscal year in which such
election became irrevocable. Except as otherwise provided in this Plan or in the
Participant’s Deferral Election Form, a Participant’s election to defer Compensation shall
remain in effect from one Plan Year to the next, unless otherwise changed by the
Participant. The provisions of this Section 3.1(c) are intended to be consistent with the
requirements of Treasury Regulation Section 1.409A-2(a). In addition, and notwithstanding
any other provisions of this Section 3.1, at the discretion of the Plan Committee, an
Eligible Employee may elect to defer Compensation within 30 days after the date the
Eligible Employee first becomes eligible to participate in the Plan; provided, however,
that any such election shall only be effective with respect to Compensation paid for
services to be performed after such 30 day period, consistent with the requirements of
Treasury Regulation Section 1.409A-2(a)(7)..

	3.2	 	EMPLOYER CONTRIBUTION CREDITS. Apart from Compensation Deferral Contributions, the Employer
shall retain the right to make discretionary contributions for any Participant under this
Plan. If applicable, there shall be established and maintained a separate Employer
Contribution Credit Account in the name of each Participant which shall be credited or
debited, as applicable, (a) amounts equal to the Employer’s Contribution Credits; and (b) any
deemed earnings and/or losses (as determined by the Employer, in its discretion) allocated to
the Employer Contribution Credit Account. The Participant’s Employer Contribution Credits for
a Plan Year, if any, shall be determined by the Employer’s Board of

6

 

	 	 	Directors in its sole discretion. The Employer shall credit such Contributions on behalf of such
individuals, in such amounts and with such frequency, as the Board determines in its sole
discretion. A Participant shall become vested in amounts (if any) credited to his or her
Employer Contribution Credit Account according to any vesting schedule(s) adopted by the
Employer’s Board of Directors, in its sole discretion, provided, however, that a Participant
shall become fully vested in amounts (if any) credited to his or her Employer Contribution
Credit Account upon the occurrence during the Participant’s employment with the Employer of: (i)
the Participant’s death or Total and Permanent Disability or (ii) a Change in Control of the
Employer.
	 
	3.3	 	CONTRIBUTIONS TO THE TRUST. An amount may be contributed, if and when applicable, by the
Employer to the Trust maintained under Section 11 equal to the amount(s) required to be
credited to the Participant’s Account under Section 3.1 and 3.2. The Employer shall make a
good faith effort to contribute these amounts to the Trust as soon as practicable following
the date on which the contribution credit amount(s) are determined.

ARTICLE 4

ALLOCATION OF FUNDS

	4.1	 	ALLOCATION OF DEEMED EARNINGS OR LOSSES ON ACCOUNTS. Subject to such limitations as may from
time to time be required by law, imposed by the Employer or the Trustee or contained elsewhere
in the Plan (including Section 4.6), and subject to such operating rules and procedures as may
be imposed from time to time by the Employer, prior to the date on which a direction will
become effective, the Participant shall have the right to direct the Employer as to how
amounts in his or her Account shall be deemed to be invested. The Employer shall direct the
Trustee to invest the account maintained in the Trust on behalf of the Participant pursuant to
the deemed investment directions the Employer has properly received from the Participant.
	 
	 	 	The value of the Participant’s Account shall be equal to the value of the account maintained
under the Trust on behalf of the Participant. As of each Valuation Date of the Trust, the
Participant’s Account will be credited or debited to reflect the Participant’s deemed
investments of the Trust. The Participant’s Account will be credited or debited with the
increase or decrease in the realizable net asset value or credited interest, as applicable, of
the designated deemed investments, as follows: As of each Valuation Date, an amount equal to the
net increase or decrease in realizable net asset value or credited interest, as applicable (as
determined by the Trustee), of each deemed investment option within the Account since the
preceding Valuation Date shall be allocated among all Participants’ Accounts deemed to be
invested in that investment option in accordance with the ratio which the portion of the Account
of each Participant which is deemed to be invested within that investment option, determined as
provided herein, bears to the aggregate of all amounts deemed to be invested within that
investment option.
	 
	4.2	 	ACCOUNTING FOR DISTRIBUTIONS. As of the date of any distribution hereunder, the distribution
made hereunder to the Participant or his or her Beneficiary or Beneficiaries shall be charged
to such Participant’s Account.

7

 

	4.3	 	SEPARATE ACCOUNTS. A separate bookkeeping account under the Plan shall be established and
maintained by the Employer to reflect the Account for each Participant with bookkeeping
sub-accounts to show separately the Participant’s Compensation Deferral and the Participant’s
Employer Contribution Credit Account. Each sub-account will separately account for the credits
and debits described in Article 3 and Section 4.2.
	 
	4.4	 	DEEMED INVESTMENT DIRECTIONS OF PARTICIPANTS. Subject to such limitations as may from time
to time be required by law, imposed by the Employer or the Trustee or contained elsewhere in
the Plan (including Section 4.5), and subject to such operating rules and procedures as may be
imposed from time to time by the Employer prior to and effective for each Designation Date,
each Participant may communicate to the Employer a direction (in accordance with (a), below)
as to how his or her Plan Accounts should be deemed to be invested among such categories of
deemed investments as may be made available by the Employer hereunder. Such direction shall
designate the percentage (in any whole percent multiples) of each portion of the Participant’s
Plan Accounts which is requested to be deemed to be invested in such categories of deemed
investments, and shall be subject to the following rules:

	 	a)	 	Any initial or subsequent deemed investment direction shall be in writing, on a form
supplied by and filed with the Employer, and/or, as required or permitted by the Employer,
shall be by oral designation and/or electronic transmission designation. A designation
shall be effective as of the Designation Date next following the date the direction is
received and accepted by the Employer on which it would be reasonably practicable for the
Employer to effect the designation.
	 
	 	b)	 	All amounts credited to the Participant’s Account shall be deemed to be invested in
accordance with the then effective deemed investment direction, and as of the Designation
Date with respect to any new deemed investment direction, all or a portion of the
Participant’s Account at that date shall be reallocated among the designated deemed
investment funds according to the percentages specified in the new deemed investment
direction unless and until a subsequent deemed investment direction shall be filed and
become effective. An election concerning deemed investment choices shall continue
indefinitely as provided in the Participant’s most recent investment direction form
provided by and filed with the Employer.
	 
	 	c)	 	If the Employer receives an initial or revised deemed investment direction which it
deems to be incomplete, unclear or improper, the Participant’s investment direction then in
effect shall remain in effect (or, in the case of a deficiency in an initial deemed
investment direction, the Participant shall be deemed to have filed no deemed investment
direction) until the next Designation Date, unless the Employer provides for, and permits
the application of, corrective action prior thereto.
	 
	 	d)	 	If the Employer possesses (or is deemed to possess as provided in (c), above) at any
time directions as to the deemed investment of less than all of a Participant’s Account,
the Participant shall be deemed to have directed that the undesignated portion of the
Account

8

 

	 	 	 	be deemed to be invested in a money market, fixed income or similar fund made available
under the Plan as determined by the Employer in its discretion.
	 
	 	e)	 	Each Participant hereunder, as a condition to his or her participation hereunder,
agrees to hold the Employer and its agents and representatives harmless, for any losses or
damages of any kind relating to the investment of the Participant’s Account hereunder,
other than such losses or damages that result directly from gross negligence or intentional
malfeasance on the part of the Employer or its agents or representatives.
	 
	 	f)	 	Each reference in this Section to a Participant shall be deemed to include, where
applicable, a reference to a Beneficiary.

	4.5	 	EXPENSES AND TAXES. Expenses associated with the administration or operation of the Plan
including Trustee fees, shall be paid by the Employer from its general assets. Any taxes
allocable to an Account (or portion thereof) maintained under the Plan which are payable prior
to the distribution of the Account (or portion thereof), as determined by the Employer, shall
be paid by the Employer.

ARTICLE 5

ENTITLEMENT TO BENEFITS

	5.1	 	FIXED PAYMENT DATES; TERMINATION OF EMPLOYMENT. On his or her Form and Timing of Payment
Election Form, a Participant shall select the manner of payment (as described in Section
6.2(b)) and shall select a fixed payment date for the payment or commencement of payment of
his or her Account (or the Participant may select fixed payment dates for the payment or
commencement of payment of portions of his or her Account), which will be valued and payable
according to the provisions of Article 6. Such payment dates may be extended to later dates
so long as elections to so extend the payment dates are made by the Participant at least six
(6) months prior to the date on which the distribution is scheduled to be made or commence.
Such payment dates may not be accelerated, except as provided in Section 5.2. A Participant
may elect on his or her Form and Timing of Payment Election an election each year they are
eligible to participate.
	 
	 	 	A Participant who selects payment or commencement of payment of his or her Account (or portions
thereof) on a fixed date or dates shall receive payment of his or her Account at the earlier of
such fixed payment date or dates (as extended, if applicable) or his or her termination of
employment with the Employer.
	 
	 	 	If a Participant’s employment with the Employer is terminated for any reason (other than by
reason of Total and Permanent Disability) prior to attainment of Retirement Age or if a
Participant does not make an election as provided above for any particular amounts hereunder,
and the Participant terminates employment with the Employer for any reason, the Participant’s
Account at the date of such termination shall be valued and payable at or commencing at such
termination according to the provisions of Article 6.

9

 

	 	 	Notwithstanding anything herein to the contrary, any election by a Participant regarding the
time and manner of payment of any 409A Benefit must be made at the same time as the deferral
election to which such 409A Benefit is attributable (or at such later time as may be permitted
by the Plan Committee, consistent with applicable IRS guidance regarding compliance with Code
Section 409A).
	 
	5.2	 	IMMEDIATE DISTRIBUTION ELECTION; TEN PERCENT PENALTY. In addition to a Participant’s option
to have payment or commencement of payment of his or her Account occur on the fixed payment
date or on the Participant’s termination of employment as described in Section 5.1, a
Participant may elect to have his or her Account (or a portion thereof) paid or commence to be
paid as soon as possible upon his or her election. For purposes of this Section, the value of
the Participant’s Account shall be determined as of the date of the distribution. Any amount
paid pursuant to this Section shall be subject to a ten percent (10%) penalty, with the amount
of the penalty permanently forfeited from the Participant’s Account and returned to the
Employer on or about the date of the distribution. In addition, the Participant will be
ineligible to participant in any manner in the Plan for a period not less than the balance of
the Plan Year within which the distribution is made and the subsequent Plan Year.
	 
	 	 	Any Participant wishing to elect an immediate distribution pursuant to this Section must
complete an Immediate Distribution Election Form. The distribution shall occur or commence as
soon as is administratively feasible following the Employer’s receipt and approval of the
Immediate Distribution Election Form.
	 
	 	 	Notwithstanding anything to the contrary in this Section 5.2, no distribution of any 409A
Benefit shall be permitted pursuant to this Section 5.2.
	 
	5.3	 	HARDSHIP DISTRIBUTIONS. In the event of financial hardship of the Participant, as
hereinafter defined, the Participant may apply to the Employer for the distribution of all or
any part of his or her Account, without penalty. The Employer shall consider the circumstances
of each such case, and the best interests of the Participant and his or her family, and shall
have the right, in its sole discretion, if applicable, to allow such distribution, or, if
applicable, to direct a distribution of part of the amount requested, or to refuse to allow
any distribution. Upon a finding of financial hardship, the Employer shall direct the
appropriate distribution to the Participant from amounts held by the Trust in respect of the
Participant’s vested account. In no event shall the aggregate amount of the distribution
exceed either the full value of the Participant’s vested account or the amount determined by
the Employer to be necessary to alleviate the Participant’s financial hardship (which
financial hardship may be considered to include any taxes due as a result of the distribution
occurring because of this Section), and which is not reasonably available from other resources
of the Participant. For purposes of this Section, the value of the Participant’s Account shall
be determined as of the date of the distribution. “Financial hardship” means (a) a severe
financial hardship to the Participant resulting from a sudden and unexpected illness or
accident of the Participant or of a dependent (as defined in Code Section 152(a)) of the
Participant, (b) loss of the Participant’s property due to casualty, or (c) other similar
extraordinary and unforeseeable circumstances arising as a result of events beyond the

10

 

	 	 	control of the Participant, each as determined to exist by the Employer. A distribution may be
made under this Section only with the consent of the Employer.
	 
	 	 	Notwithstanding anything to the contrary in this Section 5.3, no distribution of any 409A
Benefit shall be permitted pursuant to this Section 5.3, except to the extent that it is
determined that the financial hardship of a Participant also qualifies as an “unforeseeable
emergency” as that term is used for purposes of Code Section 409A(a)(2)(B)(ii), and Treasury
Regulation Section 1.409A-3(i)(3).
	 
	5.4	 	RE-EMPLOYMENT OF RECIPIENT. If a Participant receiving installment distributions pursuant to
Section 6.2 is re-employed by the Employer, the remaining distributions due to the Participant
shall be suspended until such time as the Participant (or his or her Beneficiary) once again
becomes eligible for benefits under Section 5.1 or 5.2, at which time such distribution shall
commence, subject to the limitations and conditions contained in the Plan.
	 
	5.5	 	REDEFERRALS. In the event a Participant desires to extend a previously elected payment date
that is applicable to the Participant’s 409A Benefit to a subsequent date, such election shall
be permitted only if the election to make such modification to such elected payment date is
filed at least 12 months prior to the date the distribution would have been paid (or the date
the first distribution would have been paid out of a series of distributions), and such
modification results in a deferral of payment (or distribution commencement) for at least five
years. For these purposes, a distribution of benefits in a series of installments shall be
treated, consistent with applicable guidance issued pursuant to Code Section 409A, as a single
payment distributed as of the date such series of payments is to commence.

ARTICLE 6

DISTRIBUTION OF BENEFITS

	6.1	 	AMOUNT. A Participant (or his or her Beneficiary) shall become entitled to receive, within
ninety (90) days following the earlier of the Participant’s termination of employment with the
Employer or the date or dates selected by the Participant on his or her Form and Timing of
Payment Election Form, with the Committee’s consent (or, if no such selection is made, on or
about the date of the Participant’s termination of employment with the Employer), a
distribution in an aggregate amount equal to the Participant’s vested Account. A Participant
may alternatively elect to receive an immediate distribution, subject to a ten percent (10%)
penalty, of all or a portion of his or her Account pursuant to Section 5.2. Any payment due
hereunder from the Trust, which is not paid by the Trust for any reason, will be paid by the
Employer from its general assets. Notwithstanding the foregoing, to the extent payment of a
Participant’s 409A Benefit cannot be paid upon termination of employment without violating
Code Section 409A, payment of such 409A Benefit shall be deferred as required, either by
reason of the provisions of Section 6.6, below, or if required in connection with the
Participant’s election to elect a new payment date pursuant to Section 5.5, above.

11

 

	6.2	 	METHOD OF PAYMENT.

	 	a)	 	PAYMENTS. Payments under the Plan shall be made in cash as elected by the Participant
and as permitted by the Employer and the Trustee in their sole and absolute discretion
subject, however, to Section 12.4 and any other applicable restrictions on transfer as may
be applicable legally or contractually.
	 
	 	b)	 	TIMING AND MANNER OF PAYMENT. Except as otherwise provided herein, in the case of
distributions to a Participant or his or her Beneficiary by virtue of an entitlement
pursuant to Sections 5.1 or 5.2, an aggregate amount equal to the Participant’s vested
Account will be paid by the Trust or the Employer, as provided in Section 6.1, in a lump
sum or in bi-weekly, monthly, quarterly or annual substantially equal installments for a
period not to exceed ten (10) years (adjusted for gains and losses), as selected by the
Participant as provided in Article 5. If a Participant fails to designate properly the
manner of payment of the Participant’s benefit under the Plan, such payment will be in a
lump sum.
	 
	 	 	 	If the whole or any part of a payment hereunder is to be in installments, the balance of the
Participant’s Account not yet distributed shall continue to be deemed to be invested
pursuant to Sections 4.1 and 4.5 under such procedures as the Employer may establish, in
which case any deemed income, gain, loss or expense or tax allocable thereto (as determined
by the Trustee, in its discretion) shall be reflected in the installment payments in such
equitable manner as the Trustee shall determine.
	 
	 	 	 	Notwithstanding the preceding, if at any time up to twenty- four (24) months following the
Participant’s termination of employment with the Employer the Participant enters in
Competition with Toll Brothers, Inc. and/or its subsidiaries, the Employer may accelerate
the payment of the Participant’s benefits hereunder.
	 
	 	c)	 	COMPLIANCE WITH CODE SECTION 409A. Notwithstanding anything to the contrary in this
Section 6.2, no distribution of any 409A Benefit shall be made at a time or in a manner
that is not consistent with a valid election in effect at the time the deferral to which
such 409A Benefit is attributable was made (or at such later time as may be permitted by
the Plan Committee, consistent with applicable IRS guidance regarding compliance with Code
Section 409A), or pursuant to a valid modification of the time and manner of distribution
as permitted under Section 5.1.

	6.3	 	DEATH BENEFITS. If a Participant dies before terminating his or her employment with the
Employer and before the commencement of payments to the Participant hereunder, the entire
value of the Participant’s Account shall be paid, within ninety (90) days following the
Participant’s death, in a lump sum, to the person or persons designated in accordance with
Section 7.1. Upon the death of a Participant after payments hereunder have begun but before he
or she has received all payments to which he or she is entitled under the Plan, the remaining
benefit payments shall be paid to the person or persons designated in accordance with Section
7.1, in the time and manner in which such benefits were otherwise to be payable

12

 

	 	 	to the Participant, or the Beneficiary may make an irrevocable election to receive the remaining
balance in a lump sum.
	 
	 	 	Notwithstanding the foregoing provisions of this Section 6.3, no election to modify the manner
of payment of any 409A Benefit under this Section 6.3 shall be permitted except to the extent
such election is made at the time the deferral to which such 409A Benefit is attributable was
made, or at such later time as may be permitted by the Plan Committee, consistent with
applicable IRS guidance regarding compliance with Code Section 409A.
	 
	6.4	 	DISABILITY BENEFITS. If a Participant experiences a Total and Permanent Disability before
terminating his or her employment with the Employer and before the commencement of payments to
the Participant hereunder, the Participant shall become fully vested in his or her Account,
and shall become entitled to receive (or to commence receiving) the entire balance of his or
her Account in a single lump sum payment on the thirtieth (30th) day following the Total and
Permanent Disability (or as soon thereafter as is administratively feasible). Notwithstanding
the preceding, the Participant may irrevocably elect, prior to the end of such thirty (30) day
period, to waive his or her right to a single lump sum payment and instead to receive his or
her Account in installments as provided hereunder or pursuant to an alternative payment
schedule offer by the Employer, including a schedule which takes into account the payments the
Participant receives under the group long term disability plan maintained by the Employer. If
such waiver election is timely made, the Participant shall receive his or her entire Account
balance at the time and in the manner designated by the Participant on the form supplied by
the Employer on which such waiver election is made.
	 
	 	 	Notwithstanding the foregoing provisions of this Section 6.4, no election to modify the manner
of payment of any 409A Benefit under this Section 6.4 shall be permitted except to the extent
such election is made at the time the deferral to which such 409A Benefit is attributable was
made, or at such later time as may be permitted by the Plan Committee, consistent with
applicable IRS guidance regarding compliance with Code Section 409A. In addition, no
distribution of any 409A Benefit shall be made by reason of a Participant’s Total and Permanent
Disability under this Section 6.4 unless such Participant’s condition also qualifies as
“disabled” as that term is defined in Code Section 409A(a)(2)(C) and Treasury Regulation
Section 1.409A-3(i)(4).
	 
	6.5	 	CHANGE IN CONTROL. Notwithstanding anything herein to the contrary, upon a Change in Control
of Toll Brothers, Inc., each Participant shall become fully vested in his of her Account, and
shall become entitled to receive the entire balance of his of her Account in a single lump sum
payment on the thirtieth (30th) day following the Change in Control (or as soon as
administratively feasible). Notwithstanding the preceding, the Participant may irrevocably
elect, prior to the end of such thirty (30) day period, to waive his or her right to receive
such a Change in Control distribution. If such waiver election is timely made, the Participant
shall receive his or her entire Account balance at the time designated in the most recent
Participant Enrollment and Election Form received by the Committee from the Participant, or,
if no election as to timing of Account distribution has been made on the Participant’s
Enrollment and Election Form, at the time the Participant terminates employment with the
Employer.

13

 

	 	 	Notwithstanding the foregoing provisions of this Section 6.5, each Participant’s 409A Benefit
shall be distributed on the thirtieth (30th) day following the Change in Control (or as soon as
administratively feasible) but only if the event that constitutes a Change in Control also
qualifies as a “change in the ownership or effective control of the corporation” as that phrase
is used for purposes of Code Section 409A, and then only to the extent and in the manner
permissible under Code Section 409A(a)(2)(A)(v), and applicable regulations promulgated
thereunder. In addition, no Participant shall be permitted at the time of a Change in Control to
waive or defer receipt of his or her 409A Benefit distributable by reason of such Change in
Control. Waiver of a right to receive the Change in Control distribution of a Participant’s
409A may, however, be permitted if such waiver is made at the time the deferral to which such
409A Benefit is attributable was made, or at such later time as may be permitted by the Plan
Committee, consistent with applicable IRS guidance regarding compliance with Code Section 409A.
	 
	6.6	 	SPECIAL DEFERRAL OF DISTRIBUTIONS TO SPECIFIED EMPLOYEES. Distribution of any 409A Benefit
made on account of a Participant’s termination of employment that would be paid prior to the
date that is six months after such Participant’s termination of employment, shall be deferred
and paid out as soon as practicable following the six month anniversary of such Participant’s
termination of employment; provided, however, that this Section 6.6 shall only be applicable
to a Participant who is a “specified employee,” as that term is defined in Code Section
409A(a)(2)(B)(i) and Treasury Regulation Section 1.409A-1(i)). To the extent any payment of
benefits to a Participant is delayed by reason of this Section 6.6, such Participant’s
Compensation Deferral Account shall continue to be credited with deemed investment returns,
earning, gains and losses in the same manner as Compensation Deferral Accounts are credited
for Participants who have not terminated employment with the Employer.

ARTICLE 7

BENEFICIARIES; PARTICIPANT DATA

	7.1	 	DESIGNATION OF BENEFICIARIES. Each Participant from time to time may designate any person or
persons (who may be named contingently or successively) to receive such benefits as may be
payable under the Plan upon or after the Participant’s death, and such designation may be
changed from time to time by the Participant by filing a new designation. Each designation
will revoke all prior designations by the same Participant, shall be in a form prescribed by
the Employer, and will be effective only when filed in writing with the Employer during the
Participant’s lifetime.
	 
	 	 	In the absence of a valid Beneficiary designation, or if, at the time any benefit payment is due
to a Beneficiary, there is no living Beneficiary validly named by the Participant, the Employer
shall pay any such benefit payment to the Participant’s spouse, if then living, but otherwise to
the Participant’s estate. In determining the existence or identity of anyone entitled to a
benefit payment, the Employer may rely conclusively upon information supplied by the
Participant’s personal representative, executor or administrator. If a question arises as to
the existence or identity of anyone entitled to receive a benefit payment as aforesaid, or if

14

 

	 	 	a dispute arises with respect to any such payment, then, notwithstanding the foregoing, the
Employer, in its sole discretion, may distribute such payment to the Participant’s estate
without liability for any tax or other consequences which might flow therefrom, or may take such
other action as the Employer deems to be appropriate.
	 
	7.2	 	INFORMATION TO BE FURNISHED BY PARTICIPANTS AND BENEFICIARIES; INABILITY TO LOCATE
PARTICIPANTS OR BENEFICIARIES. Any communication, statement or notice addressed to a
Participant or to a Beneficiary at his or her last post office address as shown on the
Employer’s records shall be binding on the Participant or Beneficiary for all purposes of the
Plan. The Employer shall not be obliged to search for any Participant or Beneficiary beyond
the sending of a registered letter to such last known address. If the Employer notifies any
Participant or Beneficiary that he or she is entitled to an amount under the Plan and the
Participant or Beneficiary fails to claim such amount or make his or her location known to the
Employer within three (3) years thereafter, then, except as otherwise required by law, the
Employer may direct distribution of such amount to the Participant’s estate. If the location
of none of the foregoing persons can be determined, the Employer shall have the right to
direct that the amount payable shall be deemed to be a forfeiture, except that the dollar
amount of the forfeiture, unadjusted for deemed gains or losses in the interim, shall be paid
by the Employer if a claim for the benefit subsequently is made by the Participant or the
Beneficiary to whom it was payable. If a benefit payable to an unlocated Participant or
Beneficiary is subject to escheat pursuant to applicable state law, the Employer shall not be
liable to any person for any payment made in accordance with such law.

ARTICLE 8

ADMINISTRATION

	8.1	 	PLAN COMMITTEE. Notwithstanding any other provision of the Plan document, any member of the
Plan Committee or any other officer or employee of the Employer who exercises discretion or
authority on behalf of the Employer shall not be a fiduciary of the Plan merely by virtue of
his or her exercise of such discretion or authority. The Board shall identify the Employer’s
officers and employees who shall serve as members of the Plan Committee. Because this Plan is
a “top hat” arrangement, the Plan Committee shall not be subject to the duties imposed by the
provisions of Part 4 of Title I of ERISA.
	 
	8.2	 	ADMINISTRATIVE AUTHORITY. Except as otherwise specifically provided herein, the Plan
Committee shall have the sole responsibility for and the sole discretion over the operation
and administration of the Plan, and shall have the power and authority to take all action and
to make all decisions and interpretations which may be necessary or appropriate in order to
administer and operate the Plan, including, without limiting the generality of the foregoing,
the power, duty, discretion and responsibility to:

	 	a)	 	Resolve and determine all disputes or questions arising under the Plan, and to remedy
any ambiguities, inconsistencies or omissions in the Plan.

15

 

	 	b)	 	Adopt such rules of procedure and regulations as in its opinion may be necessary for
the proper and efficient administration of the Plan and as are consistent with the Plan.
	 
	 	c)	 	Implement the Plan in accordance with its terms and the rules and regulations adopted
as described above.
	 
	 	d)	 	Make determinations with respect to the eligibility of any Eligible Employee to be or
continue as a Participant and make determinations concerning the crediting of Accounts.
	 
	 	e)	 	Appoint any persons or firms, or otherwise act to secure specialized advice or
assistance, as it deems necessary or desirable in connection with the administration and
operation of the Plan, and the Employer shall be entitled to rely conclusively upon, and
shall be fully protected in any action or omission taken by it in good faith reliance upon,
the advice or opinion of such firms or persons. The Employer shall have the power and
authority to delegate from time to time by written instrument all or any part of its
duties, powers or responsibilities under the Plan, both ministerial and discretionary, as
it deems appropriate, to any person or committee, and in the same manner to revoke any such
delegation of duties, powers or responsibilities. Any action of such person or committee
in the exercise of such delegated duties, powers or responsibilities shall have the same
force and effect for all purposes hereunder as if such action had been taken by the
Employer. Further, the Employer may authorize one or more persons to execute any
certificate or document on behalf of the Employer, in which event any person notified by
the Employer of such authorization shall be entitled to accept and conclusively rely upon
any such certificate or document executed by such person as representing action by the
Employer until such notified person shall have been notified of the revocation of such
authority.

	8.3	 	UNIFORMITY OF DISCRETIONARY ACTS. Whenever in the administration or operation of the Plan
discretionary actions by the Employer are required or permitted, such actions shall be
consistently and uniformly applied to all persons similarly situated, and no such action shall
be taken which shall discriminate in favor of any particular person or group of persons.
	 
	8.4	 	LITIGATION. Except as may be otherwise required by law, in any action or judicial proceeding
affecting the Plan, no Participant or Beneficiary shall be entitled to any notice or service
of process, and any final judgment entered in such action shall be binding on all persons
interested in, or claiming under, the Plan.
	 
	8.5	 	CLAIMS PROCEDURE. Any person claiming a benefit under the Plan (a “Claimant”) shall present
the claim, in writing, to the Employer, and the Employer shall respond in writing. If the
claim is denied, the written notice of denial shall state, in a manner calculated to be
understood by the Claimant:

	 	a)	 	The specific reason or reasons for the denial, with specific references to the Plan
provisions on which the denial is based;

16

 

	 	b)	 	A description of any additional material or information necessary for the Claimant to
perfect his or her claim and an explanation of why such material or information is
necessary; and
	 
	 	c)	 	An explanation of the Plan’s claims review procedure.

	 	 	The written notice denying or granting the Claimant’s claim shall be provided to the Claimant
within ninety (90) days after the Employer’s receipt of the claim, unless special circumstances
require an extension of time for processing the claim. If such an extension is required,
written notice of the extension shall be furnished by the Employer to the Claimant within the
initial ninety (90) day period and in no event shall such an extension exceed a period of ninety
(90) days from the end of the initial ninety (90) day period. Any extension notice shall
indicate the special circumstances requiring the extension and the date on which the Employer
expects to render a decision on the claim. Any claim not granted or denied within the period
noted above shall be deemed to have been denied.
	 
	 	 	Any Claimant whose claim is denied, or deemed to have been denied under the preceding sentence
(or such Claimant’s authorized representative), may, within sixty (60) days after the Claimant’s
receipt of notice of the denial, or after the date of the deemed denial, request a review of the
denial by notice given, in writing, to the Employer. Upon such a request for review, the claim
shall be reviewed by the Employer (or its designated representative) which may, but shall not be
required to, grant the Claimant a hearing. In connection with the review, the Claimant may have
representation, may examine pertinent documents, and may submit issues and comments in writing.
	 
	 	 	The decision on review normally shall be made within sixty (60) days of the Employer’s receipt
of the request for review. If an extension of time is required due to special circumstances,
the Claimant shall be notified, in writing, by the Employer, and the time limit for the decision
on review shall be extended to one hundred twenty (120) days. The decision on review shall be
in writing and shall state, in a manner calculated to be understood by the Claimant, the
specific reasons for the decision and shall include references to the relevant Plan provisions
on which the decision is based. The written decision on review shall be given to the Claimant
within the sixty (60) day (or, if applicable, the one hundred twenty (120) day) time limit
discussed above. If the decision on review is not communicated to the Claimant within the sixty
(60) day (or, if applicable, the one hundred twenty (120) day) period discussed above, the claim
shall be deemed to have been denied upon review. All decisions on review shall be final and
binding with respect to all concerned parties.

ARTICLE 9

AMENDMENT

	9.1	 	RIGHT TO AMEND. The Employer, by action of its Board of Directors, shall have the right to
amend the Plan, at any time and with respect to any provisions hereof, and all parties hereto
or claiming any interest hereunder shall be bound by such amendment; provided, however, that
no such amendment shall deprive a Participant or a Beneficiary of a right accrued hereunder
prior to the date of the amendment.

17

 

	9.2	 	AMENDMENTS TO ENSURE PROPER CHARACTERIZATION OF PLAN. Notwithstanding the provisions of
Section 9.1, the Plan may be amended by the Employer, by action of its Board of Directors, at
any time, retroactively if required, if found necessary, in the opinion of the Employer, in
order to ensure that the Plan is characterized as “top-hat” plan of deferred compensation
maintained for a select group of management or highly compensated employees as described under
ERISA Sections 201(2), 301(a)(3), and 401(a)(1), and to conform the Plan to the provisions and
requirements of any applicable law (including ERISA and the Code). No such amendment shall be
considered prejudicial to any interest of a Participant or a Beneficiary hereunder.

ARTICLE 10

TERMINATION

	10.1	 	EMPLOYER’S RIGHT TO TERMINATE OR SUSPEND PLAN. The Employer reserves the right to terminate
the Plan and/or its obligation to make further credits to Plan Accounts, by action of its
Board of Directors. The Employer also reserves the right to suspend the operation of the Plan
for a fixed or indeterminate period of time, by action of its Board of Directors.
	 
	10.2	 	AUTOMATIC TERMINATION OF PLAN. The Plan automatically shall terminate upon the dissolution
of the Employer, or upon its merger into or consolidation with any other corporation or
business organization if there is a failure by the surviving corporation or business
organization to specifically adopt and agree to continue the Plan.
	 
	10.3	 	SUSPENSION OF DEFERRALS. In the event of a suspension of the Plan, the Employer shall
continue all aspects of the Plan, other than Compensation Deferrals, during the period of the
suspension, in which event payments hereunder will continue to be made during the period of
the suspension in accordance with Articles 5 and 6.
	 
	10.4	 	ALLOCATION AND DISTRIBUTION. This Section shall become operative on a complete termination
of the Plan. The provisions of this Section also shall become operative in the event of a
partial termination of the Plan, as determined by the Employer, but only with respect to that
portion of the Plan attributable to the Participants to whom the partial termination is
applicable. Upon the effective date of any such event, notwithstanding any other provisions
of the Plan, no persons who were not theretofore Participants shall be eligible to become
Participants, the value of the interest of all Participants and Beneficiaries shall be
determined and paid to them as soon as is practicable after such termination in a lump sum
payment.
	 
	10.5	 	SUCCESSOR TO EMPLOYER. Any corporation or other business organization which is a successor
to the Employer by reason of a consolidation, merger or purchase of substantially all of the
assets of the Employer shall have the right to become a party to the Plan by adopting the same
by resolution of the entity’s board of directors or other appropriate governing body. If,
within ninety (90) days from the effective date of such consolidation, merger or sale of
assets, such new entity does not become a party hereto, as above provided,

18

 

	 	 	the Plan shall be automatically terminated, and the provisions of Section 10.4 shall become
operative.

ARTICLE 11

THE TRUST

The Employer may establish the Trust with the Trustee pursuant to such terms and conditions as are
set forth in the Trust agreement to be entered into between the Employer and the Trustee, or the
Employer shall cause to be maintained one or more separate sub-accounts in an existing Trust
maintained with the Trustee with respect to one or more other plans of the Employer, which
sub-account or sub-accounts represent Participants’ interests in the Plan. Any such Trust shall be
intended to be treated as a “grantor trust” under the Code and the establishment of the Trust or
the utilization of any existing Trust for Plan benefits, as applicable, shall not be intended to
cause any Participant to realize current income on amounts contributed thereto, and the Trust shall
be so interpreted.

ARTICLE 12

MISCELLANEOUS

	12.1	 	STATUS OF PARTICIPANTS.

	 	a)	 	Employees, Participants and Inactive Participants under this Plan shall have the status
of general unsecured creditors of the Employer;
	 
	 	b)	 	This Plan constitutes a promise by the Employer to make benefit payments in the future;
	 
	 	c)	 	Any trust to which this Plan refers (i.e. any trust created by the Employer and any
assets held by the trust to assist the Employer in meeting its obligations under the Plan)
shall be based on the terms of the model trust described in Revenue Procedure 92-64; and
	 
	 	d)	 	It is the intention of the parties that the arrangements under this Plan shall be
unfunded for tax purposes and for purposes of Title I of ERISA.

	12.2	 	LIMITATIONS ON LIABILITY OF EMPLOYER. Neither the establishment of the Plan nor any
modification thereof, nor the creation of any account under the Plan, nor the payment of any
benefits under the Plan shall be construed as giving to any Participant or other person any
legal or equitable right against the Employer, or any officer or employer thereof except as
provided by law or by any Plan provision. The Employer does not in any way guarantee any
Participant’s Account from loss or depreciation, whether caused by poor investment performance
of a deemed investment or the inability to realize upon an investment due to an insolvency
affecting an investment vehicle or any other reason. In no event shall the Employer, or any
successor, employee, officer, director or stockholder of the Employer, be liable to any person
on account of any claim arising by reason of the provisions of the Plan or of any instrument
or instruments implementing its provisions, or for the failure of any Participant, Beneficiary
or other person to be entitled to any particular tax consequences with respect to the Plan, or
any credit or distribution hereunder.

19

 

	12.3	 	CONSTRUCTION. If any provision of the Plan is held to be illegal or void, such illegality or
invalidity shall not affect the remaining provisions of the Plan, but shall be fully
severable, and the Plan shall be construed and enforced as if said illegal or invalid
provision had never been inserted herein. For all purposes of the Plan, where the context
admits, the singular shall include the plural, and the plural shall include the singular.
Headings of Articles and Sections herein are inserted only for convenience of reference and
are not to be considered in the construction of the Plan. The laws of the State of
Pennsylvania shall govern, control and determine all questions of law arising with respect to
the Plan and the interpretation and validity of its respective provisions, except where those
laws are preempted by the laws of the United States. Participation under the Plan will not
alter the Participant’s status as an (at will) employee nor give any Participant the right to
be retained in the service of the Employer nor any right or claim to any benefit under the
Plan unless such right or claim has specifically accrued hereunder.
	 
	 	 	The Plan is intended to be and at all times shall be interpreted and administered so as to
qualify as an unfunded deferred compensation plan, and no provision of the Plan shall be
interpreted so as to give any individual any right in any assets of the Employer which right is
greater than the rights of a general unsecured creditor of the Employer.
	 
	12.4	 	SPENDTHRIFT PROVISION/QUALIFIED DOMESTIC RELATIONS ORDER.

	 	a)	 	Except as set forth in subsection (b), no amount payable to a Participant or a
Beneficiary under the Plan will, except as otherwise specifically provided by law, be
subject in any manner to anticipation, alienation, attachment, garnishment, sale, transfer,
assignment (either at law or in equity), levy, execution, pledge, encumbrance, charge or
any other legal or equitable process, and any attempt to do so will be void; nor will any
benefit be in any manner liable for or subject to the debts, contracts, liabilities,
engagements or torts of the person entitled thereto. Further, (i) the withholding of taxes
from Plan benefit payments, (ii) the recovery under the Plan of overpayments of benefits
previously made to a Participant or Beneficiary, (iii) if applicable, the transfer of
benefit rights from the Plan to another plan, or (iv) the direct deposit of benefit
payments to an account in a banking institution (if not actually part of an arrangement
constituting an assignment or alienation) shall not be construed as an assignment or
alienation. In the event that any Participant’s or Beneficiary’s benefits hereunder are
garnished or attached by order of any court, the Employer or Trustee may bring an action or
a declaratory judgment in a court of competent jurisdiction to determine the proper
recipient of the benefits to be paid under the Plan. During the pendency of said action,
any benefits that become payable shall be held as credits to the Participant’s or
Beneficiary’s Account or, if the Employer or Trustee prefers, paid into the court as they
become payable, to be distributed by the court to the recipient as the court deems proper
at the close of said action.
	 
	 	b)	 	Subsection (a) shall not apply to the creation, assignment or recognition of a right of
an “alternate payee,” as defined in ERISA Section 206(d)(3)(K) (the “Alternate Payee”), to
all or any portion of a Participant’s Account pursuant to a “qualified domestic relations
order,” as defined in ERISA Section 206(d)(3)(B)(i) (a “QDRO”), and all or such portion

20

 

	 	 	 	of such Participant’s Account shall be distributed to such Alternate Payee in accordance
with this subsection (b), Article 5 and Article 6 and the terms of such QDRO. Such
Alternate Payee shall be treated as a Participant for all purposes of Articles 5 and 6 with
respect to the amounts that are to be distributed to such Alternate Payee under the terms of
the QDRO. Except as provided in paragraph (b)(iii), below, or under the terms of the QDRO,
all or such portion of a Participant’s Accounts that is to be distributed to the Alternate
Payee shall be distributed in accordance with the Participant’s Form and Timing of Payment
Election Form(s) in effect on the date of the creation, assignment or recognition of such
Alternate Payee’s right to all or such portion of such Accounts under the terms of the QDRO.
Notwithstanding the foregoing, to the extent provided under the terms of the QDRO:

	 	i)	 	The Plan Committee shall establish an Account for the Alternate Payee, to which
shall be credited the amounts allocated thereto under the terms of the QDRO. The
amounts so credited shall be debited from the Participant’s Account under the terms of
the QDRO.
	 
	 	ii)	 	The Alternate Payee may make elections regarding the deemed investment of the
amounts credited to such Alternate Payee’s Account in accordance with Section 4.3.
	 
	 	iii)	 	The Alternate Payee may change the distribution election applicable to the
amounts credited to such Alternate Payee’s Account by filing a Form and Timing of
Payment Election Form in accordance with Section 5.1. The Alternate Payee’s Form and
Timing of Payment Election Form, and the manner and timing of payments to the Alternate
Payee shall be subject to the requirements and limitations of Section 5.1 and Article
6.
	 
	 	iv)	 	The Alternate Payee may designate a Beneficiary or Beneficiaries to receive the
amount credited to the Alternate Payee’s Account in the event of the death of the
Alternate Payee. Designation or redesignation of a Beneficiary or Beneficiaries must
be made in accordance with the procedures set forth in Section 7.1 as if the Alternate
Payee was the Participant for all purposes thereunder.

	12.5	 	INTENT TO COMPLY WITH CODE SECTION 409A. The Plan, as amended, is intended to comply with
Code Section 409A and applicable Treasury Regulations or other guidance as may be issued by
the Treasury Department or the Internal Revenue Service interpreting such requirements so as
to avoid the imposition of tax on participants under Code Section 409A(a), and shall in all
instances be interpreted in a manner consistent with such intent. The provisions of the Plan
that relate to Code Section 409A are intended to be applicable only to benefits under the Plan
that are attributable to deferrals that are made or that become vested on or after January 1,
2005, and no material modification to the Plan is intended to have been made with respect to
deferrals made and vested prior to January 1, 2005 for the express purpose of preserving the
status of such benefits as grandfathered, or otherwise exempt from the applicability of Code
Section 409A.

21

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00150-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00150-of-00352.parquet"}]]