Document:

Deferred Compensation Plan

 

Exhibit 10.1

AutoNation, Inc. 

Deferred Compensation 

Plan

Effective December 1, 2005

 

 

AutoNation, Inc. Deferred Compensation Plan

	 	 	 	 	 
	Article I
	 	 	 	 
	Establishment and Purpose

	 	 	1	 
	 
	 	 	 	 
	Article II
	 	 	 	 
	Definitions

	 	 	1	 
	 
	 	 	 	 
	Article III
	 	 	 	 
	Eligibility and Participation

	 	 	7	 
	 
	 	 	 	 
	Article IV
	 	 	 	 
	Deferral Elections

	 	 	7	 
	 
	 	 	 	 
	Article V
	 	 	 	 
	Company Discretionary Contributions

	 	 	11	 
	 
	 	 	 	 
	Article VI
	 	 	 	 
	Valuation of Accounts; Deemed Investments

	 	 	11	 
	 
	 	 	 	 
	Article VII
	 	 	 	 
	Distribution and Withdrawals

	 	 	12	 
	 
	 	 	 	 
	Article VIII
	 	 	 	 
	Administration

	 	 	15	 
	 
	 	 	 	 
	Article IX
	 	 	 	 
	Amendment and Termination

	 	 	16	 
	 
	 	 	 	 
	Article X
	 	 	 	 
	Informal Funding

	 	 	16	 
	 
	 	 	 	 
	Article XI
	 	 	 	 
	Claims

	 	 	17	 
	 
	 	 	 	 
	Article XII
	 	 	 	 
	General Conditions

	 	 	20	 

 

 

Article I

Establishment and Purpose

AutoNation, Inc. (the “Company”) hereby adopts the AutoNation, Inc. Deferred Compensation Plan (the
“Plan”), effective December 1, 2005 (the “Effective Date”). The purpose of the Plan is to provide
each Participant with an opportunity to defer receipt of a portion of his or her salary, bonus and
other specified cash compensation. The Plan is not intended to meet the qualification requirements
of Section 401(a) of the Code. The Plan is intended: (i) to meet the requirements of Code Section
409A and other relevant provisions of the Act; (ii) to be an unfunded arrangement providing
deferred compensation to eligible employees who are part of a select group of management or highly
compensated employees of the Company and its subsidiaries within the meaning of Sections 201, 301
and 401 of ERISA; (iii) to be exempt from the requirements of Parts 2, 3 and 4 of Title I of ERISA
as a “top hat” plan; and (iv) to be eligible for the alternative method of compliance for reporting
and disclosure available for unfunded “top hat” plans.

Article II

Definitions

	2.1	 	Account. Account means a bookkeeping account maintained by the Plan Administrator to
record deferrals allocated to it by the Participant, Company Discretionary Contributions (if
any), Deemed Investments, distributions, and such other transactions, if any, that may be
required to properly administer the Plan. An Account shall be utilized solely as a device for
the measurement of the value of the Account Balance to be paid by the Company to a Participant
under the Plan. The Account shall not constitute or be treated as an escrow, trust fund, or
any other type of funded account for Code or ERISA purposes and amounts credited thereto shall
not be considered “plan assets” for federal income tax or ERISA purposes.

	2.2	 	Account Balance. Account Balance means, with respect to the Deferred Compensation
Account or any component Account, the value on each Business Day of such Account. The Account
Balance is determined as of the Payment Date (or Business Day next preceding the Payment Date
if not on a Business Day) for the purpose of paying any benefit under the provisions of
Article VII.

	2.3	 	Act. Act means the American Jobs Creation Act of 2004, as amended, and the Treasury
Department regulations promulgated thereunder.

	2.4	 	Allocation Election. Allocation Election means a choice by a Participant of one or
more Investment Options, and the allocation among them, in which future Participant deferrals
and/or existing Account Balances are Deemed Invested for purposes of determining earnings in a
particular Account.

	2.5	 	Beneficiary. Beneficiary means a natural person, estate, or trust designated by a
Participant to receive benefits to which a Beneficiary is entitled in accordance with

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	 	 	 	provisions of the Plan. The Participant’s spouse, if living, otherwise the Participant’s
estate, shall be the Beneficiary if

	 	a.	 	the Participant has not designated a natural person or trust as Beneficiary, or

	 
	 	b.	 	the designated Beneficiary(ies) has/have all predeceased the Participant.

	2.6	 	Business Day. A Business Day is each day on which the New York Stock Exchange is
open for business.
	 
	2.7	 	Cause. A Separation from Service for “Cause” means: (i) Participant’s conviction for
commission of a felony or other crime; (ii) the commission by Participant of any act against
the Company or its subsidiaries constituting willful misconduct, dishonesty, fraud, theft or
embezzlement; (iii) Participant’s failure, inability or refusal to perform any of the material
services, duties or responsibilities required by him or her by the Company or its
subsidiaries, or to materially comply with the policies or procedures established from time to
time by the Company or its subsidiaries, for any reason other than his or her illness or
physical or mental incapacity; (iv) Participant’s breach of any agreement entered into with
the Company or its subsidiaries prior to or within one year after a Separation from Service;
(v) Participant’s dependence, as determined in good faith by the Company or one of its
subsidiaries, on any addictive substance, including, but not limited to, alcohol or any
illegal or narcotic drugs; (vi) the destruction of or material damage to Company property or
property of a subsidiary caused by Participant’s willful or grossly negligent conduct; and
(vii) the willful engaging by Participant in any other conduct which is demonstrably injurious
to the Company or its subsidiaries, monetarily or otherwise.
	 
	2.8	 	Code. Code means the Internal Revenue Code of 1986, as amended from time to
time. 
	 
	2.9	 	Committee. Committee means the Deferred Compensation Committee of the Company.
	 
	2.10	 	Company. Company means AutoNation, Inc. and its successors.
	 
	2.11	 	Company Discretionary Contribution. Company Discretionary Contribution means a credit
by the Company to a Participant’s Retirement/Termination Account in accordance with the
provisions of Article V of the Plan. Company Discretionary Contributions are made or not made
in the sole discretion of the Company and the fact that a Company Discretionary Contribution
is made in one year shall not obligate the Company to continue to make such Company
Discretionary Contribution in subsequent years.
	 
	2.12	 	Compensation. Compensation means, for purposes of this Plan, base salary (including
any deferred salary under a Code Section 401(k) or 125 plan), bonus, commission and such other
cash or equity-based compensation (if any) approved by the Plan Administrator as Compensation
for purposes of this Plan.
	 
	2.13	 	Compensation Deferral Agreement. Compensation Deferral Agreement means an agreement
submitted to the Plan Administrator in which a Participant (a) makes an election to defer
Compensation in accordance with Section 4.1, (b) makes an Allocation Election with respect to
his or her Accounts, (c) specifies any In Service Distribution

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	 	 	 	Dates and (d) specifies a Payment Schedule with respect to payments from the Plan. A
Compensation Deferral Agreement is effective (and irrevocable, subject to the provisions of
the Plan) with respect to a service period or Company Contribution as of the first day
following the election period specified in Article IV or as provided under Treasury
Department Regulations. A Compensation Deferral Agreement remains in effect until modified
in accordance with the Plan. Notwithstanding the foregoing, and subject to the provisions
of Section 3.3, the Plan Administrator may modify a Participant’s Compensation Deferral
Agreement at any time to conform the Compensation Deferral Agreement and the Plan to
applicable law. The Compensation Deferral Agreement will consist of a form agreement
prepared under the authority of the Plan Administrator. A completed Compensation Deferral
Agreement, and any modifications thereto authorized under the Plan, may be submitted to the
Plan Administrator in paper or electronic form, under procedures prescribed by the Plan
Administrator.

	2.14	 	Death Distribution. Death Distribution shall mean a distribution of the total amount
of the Participant’s Deferred Compensation Account Balance, including any remaining unpaid In
Service Account balances, to the Participant’s Beneficiary(ies) in accordance with Article VII
of the Plan.
	 
	2.15	 	Deemed Investment. A Deemed Investment means the conversion of a dollar amount of
deferred Compensation and Company Discretionary Contributions (if any) credited to a
Participant’s Deferred Compensation Account into notional shares or units of ownership (or a
fraction of such measures of ownership, if applicable) of a security (e.g. mutual fund,
company stock, or other investment) which is referred to by the Investment Option(s) selected
by the Participant. The conversion shall occur as if shares (or units) of the designated
investment were being purchased (or sold, in the case of a distribution) at the purchase price
as of the close of business of the day on which the Deemed Investment occurs. At no time shall
a Participant have any real or beneficial ownership in the actual security to which the
Investment Option refers, irrespective of whether such a Deemed Investment is mirrored by an
actual identical investment by the Company or a trustee acting on behalf of the Company.
	 
	2.16	 	Deferral. Deferral means a deferral of compensation as defined in the Act.
	 
	2.17	 	Deferred Compensation Account. Deferred Compensation Account means the Account
maintained by the Plan Administrator that records the total amount of liability of the Company
to the Participants it or one of its subsidiaries employs at any point in time, and includes
all unpaid In Service Accounts, the Retirement/Termination Account, and any other Account
maintained by the Plan Administrator (e.g. a separate Company Contribution Account) to
properly administer the Plan.
	 
	2.18	 	Disability. Disability means that a Participant (a) is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last for a
continuous period of not less than 12 months, or (b) is, by reason of any medically
determinable physical or mental impairment which can be expected to result in death or can be
expected to last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than 3 months under an accident and health plan
covering

3

 

	 	 	 	employees of the Participant’s employer. A Participant will be deemed Disabled (i) if the
Participant is determined to be totally disabled by the Social Security Administration or
(ii) if the Participant is determined to be Disabled in accordance with a disability
insurance program using the Plan’s definition of Disability.

	2.19	 	Disability Benefit. Disability Benefit means payment by the Company to a Participant
of the Deferred Compensation Account Balance due to the Participant’s Disability. A
Disability Benefit shall be paid according to the Payment Schedule applicable to the
Participant’s Retirement/Termination Benefit as determined under Article VII.
	 
	2.20	 	Effective Date. Effective Date means December 1, 2005.
	 
	2.21	 	Eligible Employee. Eligible Employee means an Employee of the Company or its
subsidiaries who is part of a select group of management or highly compensated employees of
the Company (which also includes for this purpose its subsidiaries and affiliated companies)
within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1) of ERISA, and who is selected
by the Committee to participate in the Plan.
	 
	2.22	 	Employee. Employee means a full-time salaried employee of the Company or its
subsidiaries.
	 
	 	 	 
	 
	2.23	 	ERISA. ERISA means the Employee Retirement Income Security Act of 1974, as amended
from time to time.
	 
	2.24	 	In Service Distribution. In Service Distribution means a payment by the Company to a
Participant from an In Service Account on or after the In Service Distribution Date.
	 
	2.25	 	In Service Account. In Service Account means each Account established pursuant to
Section 4.6 to identify the portion of a Participant’s Deferred Compensation Account to be
paid on each In Service Distribution Date. Each In Service Account shall be credited with
deferrals as specified in the Participant’s Compensation Deferral Agreements, plus earnings on
Deemed Investments in accordance with such Participant’s Allocation Election. A Participant
may have a maximum of five (5) In Service Accounts with Balances greater than zero at any
given time (or such other maximum amount as determined by the Plan Administrator). A single
In Service Account shall be maintained with respect to each In Service Distribution Date and
all elections with respect thereto (other than an Allocation Election) shall apply to such In
Service Account.
	 
	2.26	 	In Service Distribution Date. In Service Distribution Date means the date specified
by a Participant in his or her Compensation Deferral Agreement, as modified in accordance with
Section 4.4, on which payments of an In Service Account Balance will commence in accordance
with a Payment Schedule.
	 
	2.27	 	Investment Option. Investment Option means a notional investment approved by the Plan
Administrator for use as part of an Investment Option menu, which a Participant may elect as a
measuring device to determine Deemed Investment earnings (positive or negative) to be valued
in the Participant’s Account(s). The Participant has no legal or

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	 	 	 	beneficial ownership in the security or other investment represented by the Investment
Option.

	2.28	 	Participant. Participant means an Eligible Employee employed by the Company or its
subsidiaries who: (a) has elected to defer Compensation in accordance with the Plan; (b) has
received a Company Discretionary Contribution; or (c) has a Deferred Compensation Account
Balance greater than zero regardless of whether the Participant is still employed by the
Company or its subsidiaries. A Participant’s continued participation in the Plan shall be
governed by Section 3.2 of the Plan.
	 
	2.29	 	Payment Date. Payment Date means the date on which a specified benefit of the Plan
is scheduled to commence under the applicable Payment Schedule. Specifically, the Payment
Date shall mean (a) for Separation from Service, the last day of the month following a
Participant’s Separation from Service, (b) for an In-Service Distribution, any In Service
Distribution Date, (c) for a Death Distribution, the last day of the month following the month
in which the Participant’s death occurs or (d) for Disability, the last day of the third month
following a Participant’s cessation of active service as an Employee due to a Disability. The
applicable Payment Date (and anniversaries thereof, in the event of installment payments) also
will be the date on which benefits payable as a result of the events described in (a) through
(d), above, are valued.
	 
	2.30	 	Payment Schedule. Payment Schedule means the form of benefits described in Article
VII. The Payment Schedule will be a single lump sum unless the Participant elects an
alternative Payment Schedule at the time(s) and in the manner specified in this Plan.
	 
	 	 	A Retirement/Termination Benefit may be paid (a) in a lump sum or (b) annual installments
from two (2) to ten (10) years.
	 
	 	 	An In Service Account may be paid (c) in a lump sum equal to 100% of the In Service Account
Balance or (d) in annual installments from two (2) to five (5) years.
	 
	 	 	Notwithstanding any Payment Schedule elected by a Participant, distributions shall not be
made in such a manner as to cause the acceleration of a payment in violation of the Act.
The Plan Administrator retains the authority to determine when and to what extent a payment
option, unless modified, would result in acceleration of a payment and to make corresponding
adjustments to the Participant’s Payment Schedule to avoid an impermissible acceleration.
	 
	2.31	 	Performance-Based Compensation. Performance-Based Compensation means Compensation
based on services performed over a period of not less than twelve months and which meets the
following requirements: (a) the payment of the Compensation or the amount of the Compensation
is contingent upon the satisfaction of organizational or individual performance criteria that
are established within the first 90 days of the performance period, and (b) the performance
criteria are not substantially certain to be met at the time a Compensation Deferral Agreement
is submitted to the Plan Administrator. Performance criteria may be subjective but must
relate to the performance of the Participant, a group of Employees that includes the
Participant or a business unit (which may include the Company) for which the Participant
provides

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	 	 	 	services.The determination that any subjective performance criteria have been met shall
not be made by the Participant or by a family member of the Participant. Performance-Based
Compensation does not include any amount or portion of any amount that will be paid
regardless of performance or which is based on a level of performance that is substantially
certain to be met at the time the criteria is established. The definition of
Performance-Based Compensation shall at all times be applied consistently with the
provisions of the Act, which are incorporated by reference.

	2.32	 	Plan. Plan means the AutoNation, Inc. Deferred Compensation Plan as documented
herein and as may be amended from time to time hereafter.
	 
	2.33	 	Plan Administrator. Plan Administrator means the Deferred Compensation Committee of
the Company.
	 
	2.34	 	Plan Year. Plan Year means January 1 through December 31.
	 
	2.35	 	Retirement. Retirement means Separation from Service on or after attaining age sixty
(60) with at least six (6) years of continuous service as an Employee with the Company and/or
one of its subsidiaries.
	 
	2.36	 	Retirement/Termination Account. Retirement/Termination Account shall mean, prior to
Participant’s Separation from Service, the portion of the Deferred Compensation Account not
allocated to In Service Accounts.
	 
	 	 	Upon a Participant’s Separation from Service, the Retirement/Termination Account shall mean
the Participant’s entire vested Deferred Compensation Account and all elections with respect
to the Retirement/Termination Account (other than an Allocation Election) shall apply to the
entire Retirement/Termination Account Balance.
	 
	2.37	 	Retirement/Termination Benefit. Retirement/Termination Benefit shall mean the
payment(s) by the Company to a Participant of his or her Retirement/Termination Account
Balance as a result of such Participant’s Separation from Service. Such payment(s) will be
made in accordance with the Participant’s Payment Schedule.
	 
	2.38	 	Separation from Service. Separation from Service or Separates from Service shall
mean a Participant’s termination of employment with the Company or its subsidiaries for any
reason. The foregoing not withstanding, if a Participant transfers to the employ of the
Company or any other entity that is within the controlled group of entities described in
Section 414(b),(c),(m) or (o) of the Code that includes the Company, no Separation from
Service shall be deemed to have occurred for purposes of this Plan. Whether a Separation from
Service has occurred will be subject to Treasury Department regulations promulgated under the
Act.
	 
	2.39	 	Unforeseeable Emergency. An unforeseeable emergency is 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 section 152(a)) of the Participant, loss of the
Participant’s property due to casualty, or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the Participant, as

6

 

	 	 	 	defined in Prop. Treas. Reg. 1.409A-3(g)(3). The Plan Administrator, in its sole discretion
and subject to the requirements of the Act, shall determine whether a Participant has
experienced an Unforeseeable Emergency. Imminent foreclosure or eviction from the
Participant’s or Beneficiary’s primary residence, the need to pay medical expenses, and
funeral expenses of a spouse or dependent may constitute an Unforeseeable Emergency. The
purchase of a home and the payment of college tuition are not Unforeseeable Emergencies.

Article III

Eligibility and Participation

	3.1	 	Eligibility and Participation. Each Eligible Employee shall be eligible to
participate in this Plan. An Eligible Employee becomes a Participant upon submission of a
Compensation Deferral Agreement to the Plan Administrator.
	 
	3.2	 	Duration. A Participant shall be eligible to defer Compensation and receive
allocations of Company Discretionary Contributions subject to the terms of the Plan as long as
such Participant is an Eligible Employee. A Participant who is no longer an Eligible Employee
but continues to be employed by the Company may not defer Compensation but may otherwise
exercise all of the rights of a Participant under the Plan with respect to his or her Deferred
Compensation Account. On and after a Separation from Service, a Participant shall remain a
Participant as long as his or her Compensation Deferral Account is greater than zero and
during such time may continue to make Allocation Elections. An individual shall cease
participation in the Plan when all benefits under the Plan to which he or she is entitled have
been paid.
	 
	3.3	 	Revocation of Future Participation. Notwithstanding the provisions of Section 3.2,
the Committee may, in its discretion, revoke such Participant’s eligibility to make future
deferrals under this Plan. Such revocation will not affect in any manner a Participant’s
Deferred Compensation Account or other terms of this Plan.
	 
	3.4	 	Notification. Each newly Eligible Employee shall be notified by the Plan
Administrator, in writing, of the date of his or her initial eligibility to participate in
this Plan.

Article IV

Deferral Elections

	4.1	 	Deferral Elections. A Participant shall make deferral elections by completing and
submitting to the Plan Administrator the Compensation Deferral Agreement which shall specify
the deferral, Allocation Election and Payment Schedule Election as described in this Article
IV.

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	4.2	 	Time of Election.

	 	a.	 	Initial Eligibility. In the case of the Plan Year in which an Employee first
becomes an Eligible Employee, a Compensation Deferral Agreement that defers Compensation
with respect to services to be performed in such Plan Year and subsequent to the election
may be submitted to the Plan Administrator within 30 days after such Eligible Employee
becomes eligible to participate in the Plan.
	 
	 	 	 	Where the Compensation Deferral Agreement is submitted in the first year of eligibility, but
after the commencement of a service period for an item of Compensation that is based on the
entire service period, the Compensation Deferral Agreement shall apply to the portion of
such Compensation that is not greater than the total amount of such Compensation for the
entire service period, multiplied by the ratio of (a) the number of days remaining in the
service period after the Compensation Deferral Agreement is submitted over (b) the total
number of days in the service period.
	 
	 	 	 	If an Eligible Employee does not submit a Compensation Deferral Agreement within the first
30 days of his or her eligibility to participate in the Plan, such Eligible Employee may
submit a Compensation Deferral Agreement at such other times as are specified in this Plan.
Such Compensation Deferral Agreement shall constitute the initial deferral election with
respect to the Payment Schedule applicable to the Participant’s Retirement/Termination and
In Service Distribution Accounts.
	 
	 	b.	 	Subsequent Plan Years. For any subsequent Plan Year, the Compensation Deferral
Agreement containing the election to defer Compensation (other than Performance-Based
Compensation described in Section 4.2c. below) for services performed during such Plan Year
must be submitted to the Plan Administrator no later than the close of the preceding Plan
Year.
	 
	 	c.	 	Performance-Based Compensation. A Compensation Deferral Agreement containing
an election to defer Performance-Based Compensation must be submitted to the Plan
Administrator no later than six months prior to the end of the period in which the services
are performed and in accordance with the Act.

	4.3	 	Amount of Deferral. The deferral election under a Compensation Deferral Agreement
shall designate a dollar amount or whole percentage of Compensation to be deferred. The Plan
Administrator may establish a minimum or maximum deferral amount for each component of
Compensation and may permit separate elections for each component of Compensation. Unless
otherwise specified by the Plan Administrator in the Compensation Deferral Agreement,
Participants may defer up to 75% of their base salary and up to 90% of Compensation other than
base salary for a Plan Year.
	 
	4.4	 	Changes To A Deferral Election.

	 	a.	 	Company’s Right to Reduce. The Plan Administrator shall have the right
to reduce a Participant’s Deferral Election in the event that the Participant’s
Deferral Election results in insufficient non-deferred Compensation from which to
withhold taxes in

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	 	 	 	accordance with applicable law and Company procedures, and/or from which to make
Participant contributions to Company welfare benefit plans in accordance with
Participant elections under those plans and Company procedures. Such reduction shall be
the minimum required to produce sufficient non-deferred Compensation to satisfy the
aforesaid obligations.

	 	b.	 	Right to Modify Prospectively. An election to defer Compensation
applies to the Plan Year specified in the Compensation Deferral Agreement and remains
in effect for each subsequent Plan Year until modified or revoked. After the end of an
applicable enrollment period, a Participant may not modify or revoke a Compensation
Deferral Agreement for the applicable Plan Year, except as provided in Section 4.4d. A Participant may modify or
revoke an election to defer Compensation effective as of the following Plan Year during
any enrollment period designated by the Plan Administrator.
	 
	 	c.	 	Performance-Based Compensation. An election to defer
Performance-Based Compensation applies to the service period specified in the
Compensation Deferral Agreement and remains in effect for future Performance-Based
Compensation until modified or revoked during an enrollment period designated by the
Plan Administrator. A modification or revocation will apply prospectively to the
Performance-Based Compensation described in the enrollment materials.
	 
	 	d.	 	Unforeseeable Emergency. A Participant may revoke an election to defer
Compensation during the Plan Year in which such Compensation is earned (or, in the case
of Performance-Based Compensation, after the deadline specified in the enrollment
materials) in the case of (a) an Unforeseeable Emergency or (b) a hardship distribution
to the Participant described in Treas. Reg. Section 1.401(k)-1(d)(3).

	4.5	 	Allocation Elections. A Participant’s deferral election may also specify the
Investment Options in which deferrals will be deemed to be invested in accordance with Section
6.2.

4.6   In Service Distributions.

	 	a.	 	Initial Election. A Participant’s Compensation Deferral Agreement may
designate In Service Distribution Date(s) which may occur no earlier than the minimum
deferral period specified by the Plan Administrator from time to time. The Plan
Administrator shall create an In Service Account for each In Service Distribution Date
to be credited with the portion of deferred Compensation designated under the
Compensation Deferral Agreement. In order for any portion of a deferral to be credited
to an In Service Account, the In Service Distribution Date must be specified no later
than the applicable submission deadline described in Section 4.2 for the Deferred
Compensation Agreement under which the deferral is made. Any portion of a deferral not
designated for an In Service Distribution will be credited to the
Retirement/Termination Account.
	 
	 	b.	 	Modification. The Participant may change or cancel an In Service
Distribution Date as follows:

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	 	i.	 	An existing In Service Distribution Date may be changed so long
as (i) the election may not take effect until at least twelve (12) months after
the date on which the election is made, (ii) the date that such election is
submitted to the Plan Administrator is at least twelve (12) months prior to the
existing In Service Distribution Date, and (iii) the modified In Service
Distribution Date is at least five (5) years after the previous In Service
Distribution Date.
	 
	 	ii.	 	A modification to an In Service Distribution Date that does not
conform to the requirements of this paragraph shall be deemed not to have been
made and will be disregarded by the Plan Administrator. In such a case, the
Plan Administrator will pay benefits at the time and under the Payment Schedule
in effect prior to the nonconforming modification.
	 
	 	iii.	 	An election to change an In Service Distribution Date is
specific to the In Service Account to which it refers, and shall not affect
other In Service Accounts or the ability of the Participant to designate new In
Service Distribution Dates with respect to future Compensation deferrals.
	 
	 	iv.	 	The modification of an In Service Distribution Date shall be
further subject to the requirements set forth in Treasury Department
Regulations.

	4.7	 	Payment Schedule. An Eligible Employee’s initial Compensation Deferral Agreement
filed with the Plan Administrator may specify the Payment Schedule for a Participant’s
Retirement/Termination Benefit. A Compensation Deferral Agreement that establishes an In
Service Distribution Date may specify the Payment Schedule for a Participant’s In Service
Distribution(s). If the Compensation Deferral Agreement does not specify a Payment Schedule,
a distribution from the applicable Account will be made in a single lump sum.

	 	a.	 	Modification—Retirement/Termination Account. A Participant may modify
his or her Retirement/Termination Payment Schedule, provided (i) the election may not
take effect until at least twelve (12) months after the date on which the election is
made, (ii) such election is made at least twelve (12) months prior to the Participant’s
Retirement/Termination Benefit Payment Date, and (iii) the first payment with respect
to which such election is made must be deferred for a period of not less than five (5)
years from the Retirement/Termination Benefit Payment Date. A modification to a
Payment Schedule that does not conform to the requirements of this paragraph shall be
deemed not to have been made and will be disregarded by the Plan Administrator. In
such a case, the Plan Administrator will pay benefits under the Payment Schedule in
effect prior to the nonconforming payment modification.
	 
	 	b.	 	Modification—In Service Distribution. A Participant shall be permitted
to change each In Service Payment Schedule, provided (i) the election may not take
effect until at least twelve (12) months after the date on which the election is made,
(ii) such election is made at least twelve (12) months prior to the scheduled In
Service Distribution Date, and (iii) the Participant designates a new In Service
Distribution Date that is not less than five (5) years after the scheduled In Service
Distribution

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	 	 	 	Date. A modification to a Payment Schedule that does not conform to the requirements of
this paragraph shall be deemed not to have been made and will be disregarded by the Plan
Administrator. In such a case, the Plan Administrator will pay benefits under the
Payment Schedule in effect prior to the nonconforming payment modification.

Article V

Company Contributions

	5.1	 	Company Discretionary Contributions. The Company may, in its sole and absolute
discretion, make Company Discretionary Contributions to one, some, or all of the
Participant(s) in an amount determined in the sole and absolute discretion of the Committee.
A Company Discretionary Contribution may be made at any time during the Plan Year and may
consist of “matching” contributions. The Company shall be under no obligation to make
contributions to the Plan unless it so obligates itself under an employment agreement or other
agreement.

	5.2	 	Vesting. Company Discretionary Contributions and the Deemed Investment earnings
thereon, shall vest in accordance with the vesting schedule(s) established by the Plan
Administrator at the time that the Company Discretionary Contribution is made. The unvested
portion shall be forfeited upon Separation from Service. The foregoing provisions concerning
vesting of Company Discretionary Contributions notwithstanding, and subject to the
requirements of Treasury regulations promulgated under the Act, all Company Discretionary
Contributions shall become 100% vested upon the occurrence of the earliest of: (a) Retirement,
(b) death of the Participant; or (c) Disability of the Participant. The foregoing
notwithstanding, certain Company Discretionary Contributions (other than “matching”
contributions) shall be forfeited in the event of a Separation from Service for Cause, as
provided in Article VII. The Committee may, at any time, in its sole discretion, increase a
Participant’s vested interest in a Company Discretionary Contribution or restore any
forfeiture.

Article VI

Valuation of Accounts; Deemed Investments

	6.1	 	Valuation. The valuation of a Participant’s Accounts will be adjusted as of each
Business Day to reflect deferrals, earnings on Deemed Investments and distributions since the
previous Business Day. The valuation of a benefit payable under Article VII will be
determined as of the applicable Payment Date. The Plan Administrator may adopt such
additional or alternative procedures as it may reasonably determine are appropriate for the
valuation of Participant Accounts. Deferrals pertaining to base salary shall be deducted on
a proportionate basis from each paycheck the Participant receives during the Plan Year and
credited to the Participant’s Accounts as of the date such Compensation would have otherwise
been paid. Deferrals pertaining to other forms of Compensation shall be credited to the
Participant’s Accounts as of the day such Compensation otherwise would have been paid.

11

 

	6.2	 	Allocation Elections. Participants may make an Allocation Election pursuant to which
their Accounts will be credited with earnings on Deemed Investments. A Participant may make a
new Allocation Election with respect to future deferrals or current Account Balances (or
both), provided that such new allocations shall be in increments of one percent (1%) of each
Account and apply to such Account Balance. Subject to restrictions on the timing and number
of permitted changes to Allocation Elections within certain time periods (if any) established
by the Plan Administrator, new Allocation Elections may be made on any Business Day, and will
become effective on the same Business Day or, in the case of Allocation Elections received
after a cut-off time established by the Plan Administrator, the following Business Day. All
deferrals shall be credited to the appropriate Account and a Deemed Investment shall be made
in the investment(s) represented by the Investment Option(s) elected by the Participant as of
the close of business on the deferral date or as otherwise provided by the Plan Administrator.

	6.3	 	Investment Options. Deemed Investments shall consist of a menu of Investment Options
provided by the Plan Administrator. Investment Options do not represent actual ownership of,
nor ownership rights in or to, the securities or other investments to which the Investment
Options refer. The Plan Administrator, in its sole discretion, shall be permitted to add or
remove Investment Options provided that any such additions or removals of Investment Options
shall not be effective with respect to any period prior to the effective date of such change.
Any portion of an Account or new deferrals which has not been allocated or which cannot be
allocated under a Participant’s Allocation Election shall be deemed to be invested in a money
market fund or such other default Investment Option specified by the Plan Administrator. Such
Investment Option shall have, as its primary objective, the preservation of capital.

	6.4	 	Notional Investments. Notwithstanding anything in this section to the contrary, the
Plan Administrator shall have the sole and exclusive authority to direct the investment of any
or all amounts deferred in any manner, regardless of any Allocation Elections by any
Participant. A Participant’s Allocation Election and Deemed Investments shall be used solely
for purposes of determining the value of such Participant’s Account Balances and the amount of
the corresponding liability of the Company in accordance with this Plan.

Article VII

Distribution and Withdrawals

	7.1	 	Retirement/Termination Benefit Distribution.

	 	a.	 	In the event that a Participant Separates from Service, the
Retirement/Termination Benefit will be valued (subject to Section 7.1b.) as of the
Payment Date and paid to such Participant in accordance with such Participant’s
Retirement/Termination Benefit Payment Schedule election. The Retirement/Termination
Benefit will be paid (or the first payment will be made) by the Company on the Payment
Date.
	 
	 	b.	 	In the event of a Separation from Service for Cause, (i) the vested portion of
the Retirement/Termination Benefit represented by Company Discretionary

12

 

	 	 	 	Contributions and earnings thereon (other than “matching” contributions) shall be
determined without regard to Section 5.2(a) (meaning that any accelerated vesting upon
Retirement shall be disregarded), and (ii) in addition, the Participant shall forfeit
any Company Discretionary Contributions (other than “matching contributions”) which
became “vested” within the three calendar years preceding the year, and the year, in
which the Separation from Service occurs.

	 	c.	 	Notwithstanding anything in this Plan document to the contrary, a Participant
who is a “specified employee,” as defined in the regulations promulgated under Code
section 409A, will receive (or commence receiving, in the case of installment payments)
his or her Retirement/Termination Benefit on the first day of the seventh month
following his or her Separation from Service. The Participant’s Retirement/Termination
Benefit also will be valued on such date. However, if the Participant’s Payment
Schedule requires a series of annual installments, the first installment shall be
determined under Section 7.3 using the date set forth in this paragraph as the
valuation date and all subsequent installments shall be determined under Section 7.3
using the anniversary of the Separation from Service Payment Date as defined in
Sections 2.29 and 7.1a.
	 
	 	d.	 	For purposes of Code section 409A, the Plan Administrator shall determine which
Participants are specified employees as of December 31 in accordance with the
regulations promulgated under Code section 409A. Such determination shall be effective
for the twelve (12) month period commencing on April 1 of the following Plan Year.

	7.2	 	In Service Distributions.

	 	a.	 	Each In Service Distribution shall be paid in accordance with the Payment
Schedule election made with respect thereto, beginning on the In Service Distribution
Date. In the event a Participant has elected installment payments for an In Service
Distribution, the installment payments shall be determined as set forth in Section 7.3
of the Plan.
	 
	 	b.	 	Notwithstanding a Participant’s election to receive an In Service Distribution,
all In Service Account Balances shall be distributable as part of a
Retirement/Termination, Disability, or Death Distribution if the Participant’s
Separation from Service, Disability or death occurs prior to the completion of
payment(s) elected in connection with any In Service Distribution Date. Such
distribution will be made only if the payment does not constitute a violation under the
Act.

	7.3	 	Installment Payments. Installment payments will be made on the applicable Payment
Date and each anniversary thereof. The amount of an installment payment is the applicable
Account Balance as of the Payment Date (or anniversary thereof) divided by the remaining
number of installments under the Payment Schedule.

	7.4	 	Small Account Balance Lump Sum Payment. Anything to the contrary in this Plan
notwithstanding, in the event that a Participant’s Retirement/Termination Account Balance is
less than $25,000 on the applicable Payment Date, the Retirement/Termination Benefit

13

 

	 	 	 	shall be paid in a single lump sum and any form of payment election to the contrary shall be
null and void. A payment of a Retirement/Termination Account under this Section 7.4 shall
be made on or before the later of (a) December 31 of the year in which the Participant’s
Separation from Service occurs or (b) the date that is 2-1/2 months after the Participant’s
Separation from Service.

	7.5	 	Disability Benefit. The Company shall pay the Disability Benefit on the Payment
Date.

	7.6	 	Death Distribution. In the event of a Participant’s death while employed by the
Company, the Participant’s Beneficiary shall be paid a Death Distribution on the Payment Date
in the amount of the remaining Deferred Compensation Account Balance as of the Payment Date.
If a Participant is receiving a Retirement/Termination Benefit in annual installments, such
installment payments will continue to be paid to the Participant’s Beneficiary upon the
Participant’s death. The Death Distribution shall conform to the requirements of the Act in
order to avoid an “acceleration” of a payment.

	7.7	 	Unforeseeable Emergency. A Participant may request, in writing to the Plan
Administrator, a withdrawal from his or her Deferred Compensation Account if the Participant
experiences an Unforeseeable Emergency. Withdrawals of amounts because of an Unforeseeable
Emergency are limited to the extent reasonably needed to satisfy the emergency need, which
cannot be met with other resources of the Participant. The amount of such withdrawal shall be
subtracted first from the vested portion of the Participant’s Retirement/Termination Account
until depleted and then from the In Service Distribution Accounts (if any) beginning with the
Account with the latest In Service Distribution Date. Values for purposes of determining the
source of the withdrawal under this Section shall be determined on the date the Plan
Administrator approves the amount of the Unforeseeable Emergency withdrawal, or such other
date determined by the Plan Administrator.

	7.8	 	Domestic Relations Order. Notwithstanding the Payment Schedule(s) and In Service
Distribution Dates selected by a Participant and any other provision of this Plan, the Plan
Administrator shall divide such Participant’s Accounts with and distribute a portion of such
Participant’s Accounts to one or more “alternate payees” at the time and in the manner
specified in a court order described in Section 414(p)(1)(B) of the Code.

	7.9	 	Permitted Delays. Notwithstanding the foregoing, the Company shall delay any payment
to a Participant under the Plan upon the Plan Administrator’s reasonable anticipation of one
or more of the following events:

	 	a.	 	The Company’s deduction with respect to such payment otherwise would be limited
or eliminated by application of Code section 162(m);
	 
	 	b.	 	The making of the payment would violate a term of a loan agreement to which the
Company or one of its subsidiaries is a party, or other similar contract to which the
Company or one of its subsidiaries is a party, and such violation would cause material
harm to the Company or one of its subsidiaries; or
	 
	 	c.	 	The making of the payment would violate Federal securities laws or other
applicable law;
provided, that any payment subject to this Section 7.9 shall be paid in accordance with the
Act.

14

 

Article VIII

Administration

	8.1	 	Plan Administration. This Plan shall be administered by the Plan Administrator, which
shall have discretionary authority to make, amend, interpret and enforce all appropriate rules
and regulations for the administration of this Plan and to utilize its discretion to decide or
resolve any and all questions, including but not limited to eligibility for benefits and
interpretations of this Plan and its terms, as may arise in connection with the Plan. Claims
for benefits shall be filed with the Plan Administrator and resolved in accordance with the
claims procedures in Article XI.

	8.2	 	Withholding. The Company shall have the right to withhold from any payment made
under the Plan (or any amount deferred into the Plan) any taxes required by law to be withheld
in respect of such payment (or deferral).

	8.3	 	Indemnification. The Company shall indemnify and hold harmless each employee,
officer, or director to whom or to which it delegated duties, responsibilities, and authority
under the Plan or otherwise with respect to administration of the Plan, including, without
limitation, the Plan Administrator and the Committee, against all claims, liabilities, fines
and penalties, and all expenses reasonably incurred by or imposed upon him or it (including
but not limited to reasonable attorney fees) which arise as a result of his or its actions or
failure to act in connection with the operation and administration of the Plan to the extent
lawfully allowable and to the extent that such claim, liability, fine, penalty, or expense is
not paid for by liability insurance purchased or paid for by the Company.

	8.4	 	Expenses. The expenses of administering the Plan shall be paid by the Company.
Notwithstanding the foregoing, the Committee may indirectly allocate expenses, in its
discretion, to Participants through a reduction to any or all Participant Accounts.

	8.5	 	Delegation of Authority. In the administration of this Plan, the Plan Administrator
may, from time to time, employ agents and delegate to them such administrative duties as it
sees fit, and may from time to time consult with legal counsel who may be legal counsel to the
Company.

	8.6	 	Binding Decisions or Actions. The decision or action of the Plan Administrator in
respect of any question arising out of or in connection with the administration,
interpretation and application of the Plan and the rules and regulations thereunder shall be
final and conclusive and binding upon all persons having any interest in the Plan.

15

 

Article IX

Amendment and Termination

	9.1	 	Amendment and Termination. The Plan is intended to be permanent, but the Company may
at any time modify, amend, or terminate the Plan, provided that such modification, amendment
or termination shall not cancel, reduce, or otherwise adversely affect the amount of benefits
of any Participant accrued (and any form of payment elected) as of the date of any such
modification, amendment, or termination, without the consent of the Participant. A
termination of the Plan shall not, by itself, result in payments to Participants under the
Plan, except to the extent permitted in regulations promulgated under the Act. Unless
distributions are otherwise permissible under such regulations, payments to Participants shall
be made at the times specified in a Participant’s Compensation Deferral Agreements and the
terms of the Plan applicable to such Agreements prior to the Plan’s termination.

	9.2	 	Adverse Income Tax Determination. Notwithstanding anything to the contrary in the
Plan, if any Participant receives a deficiency notice from the United States Internal Revenue
Service asserting constructive receipt of deferrals under the Plan, Company Discretionary
Contributions, and/or the investment earnings attributed thereto due to any Participant
withdrawal right or other Plan provision, the Plan Administrator, in its sole discretion, may
declare null and void any Plan provision with respect to affected Participants that causes
such Participant to be in constructive receipt of income. If the laws of the United States or
of any relevant state are amended or construed in such a way as to make this Plan (or its
intended deferral of compensation and taxes) in whole or in part void, then the Plan
Administrator, in its sole discretion, may give effect to the Plan in such a manner as it
deems will best carry out the purposes and intentions of this Plan. Nothing in this Section
9.2 shall be construed to limit the Plan Administrator or Company’s authority under applicable
law to take any such action as may be necessary to accomplish the objective of the Plan to
defer the recognition of compensation for the purpose of the taxation of income.

	 	 	Notwithstanding any other provision of this Plan document or the provisions of any
Compensation Deferral Agreement, a Participant will receive a distribution from the Plan in
a single lump sum equal to the amount required to be included in income as a result of a
violation of the terms and conditions of Code Section 409A and the Treasury Department
Regulations promulgated thereunder.

Article X

Informal Funding

	10.1	 	General Assets. All benefits in respect of a Participant under this Plan shall be
paid directly from the general funds of the Company or a Rabbi Trust created for the purpose
of informally funding the Plan, and other than such Rabbi Trust, if created, no special or
separate fund shall be established and no other segregation of assets shall be made to assure
payment. No Participant, spouse or Beneficiary shall have any right, title or interest
whatever in or to any investments that the Company or its subsidiaries may make

16

 

	 	 	 	to aid the Company in meeting its obligation hereunder. Nothing contained in this Plan, and
no action taken pursuant to its provisions, shall create or be construed to create a trust
of any kind, or a fiduciary relationship, between the Company, or any if its subsidiaries or
affiliated companies and any Employee, spouse, or Beneficiary. To the extent that any
person acquires a right to receive payments from the Company hereunder, such rights are no
greater than the right of an unsecured general creditor of the Company.

	10.2	 	Rabbi Trust. The Company may, at its sole discretion, establish a grantor trust,
commonly known as a Rabbi Trust, as a vehicle for accumulating the assets needed to pay the
promised benefit, but the Company shall be under no obligation to establish any such trust or
any other informal funding vehicle.

Article XI

Claims

	11.1	 	Filing a Claim. Any controversy or claim arising out of or relating to the Plan shall
be filed with the Plan Administrator which shall make all determinations concerning such
claim. Any decision by the Plan Administrator denying such claim shall be in writing and shall
be delivered to the Participant or Beneficiary filing the claim (‘Claimant’).

	 	a.	 	In General. Notice of a denial of benefits (other than Disability
benefits) will be provided within 90 days of the Plan Administrator’s receipt of the
Claimant’s claim for benefits. If the Plan Administrator determines that it needs
additional time to review the claim, the Plan Administrator will provide the Claimant
with a notice of the extension before the end of the initial 90-day period. The
extension will not be more than 90 days from the end of the initial 90-day period and
the notice of extension will explain the special circumstances that require the
extension and the date by which the Plan Administrator expects to make a decision.
	 
	 	b.	 	Disability Benefits. Notice of denial of Disability benefits will be
provided within forty-five (45) days of the Plan Administrator’s receipt of the
Claimant’s claim for Disability benefits. If the Plan Administrator determines that it
needs additional time to review the Disability claim, the Plan Administrator will
provide the Claimant with a notice of the extension before the end of the initial
45-day period. If the Plan Administrator determines that a decision cannot be made
within the first extension period due to matters beyond the control of the Plan
Administrator, the time period for making a determination may be further extended for
an additional 30 days. If such an additional extension is necessary, the Plan
Administrator shall notify the Claimant prior to the expiration of the initial 30-day
extension. Any notice of extension shall indicate the circumstances necessitating the
extension of time, the date by which the Plan Administrator expects to furnish a notice
of decision, the specific standards on which such entitlement to a benefit is based,
the unresolved issues that prevent a decision on the claim and any additional
information needed to resolve those issues. A Claimant will be provided a minimum of
45 days to submit any necessary additional information to the Plan Administrator. In
the event that a 30-day extension is necessary due to a Claimant’s failure to submit
information necessary to

17

 

	 	 	 	decide a claim, the period for furnishing a notice of decision shall be tolled from the
date on which the notice of the extension is sent to the Claimant until the earlier of
the date the Claimant responds to the request for additional information or the response
deadline.

	 	c.	 	Contents of Notice. If a claim for benefits is completely or partially
denied, notice of such denial shall be in writing and shall set forth the reasons for
denial in plain language. The notice shall (1) cite the pertinent provisions of the
Plan document and (2) explain, where appropriate, how the Claimant can perfect the
claim, including a description of any additional material or information necessary to
complete the claim and why such material or information is necessary. The claim denial
also shall include an explanation of the claims review procedures and the time limits
applicable to such procedures, including a statement of the Claimant’s right to bring a
civil action under Section 502(a) of ERISA following an adverse decision on review. In
the case of a complete or partial denial of a Disability benefit claim, the notice
shall provide a statement that the Plan Administrator will provide to the Claimant,
upon request and free of charge, a copy of any internal rule, guideline, protocol, or
other similar criterion that was relied upon in making the decision.

	11.2	 	Appeal of Denied Claims. A Claimant whose claim has been completely or partially
denied shall be entitled to appeal the claim denial by filing a written appeal with the
Committee. A Claimant who timely requests a review of the denied claim (or his or her
authorized representative) may review, upon request and free of charge, copies of all
documents, records and other information relevant to the denial and may submit written
comments, documents, records and other information relevant to the claim to the Committee.
All written comments, documents, records, and other information shall be considered “relevant”
if the information (1) was relied upon in making a benefits determination, (2) was submitted,
considered or generated in the course of making a benefits decision regardless of whether it
was relied upon to make the decision, or (3) demonstrates compliance with administrative
processes and safeguards established for making benefit decisions. The Committee may, in its
sole discretion and if it deems appropriate or necessary, decide to hold a hearing with
respect to the claim appeal.

	 	a.	 	In General. Appeal of a denied benefits claim (other than a Disability
benefits claim) must be filed in writing with the Committee no later than sixty (60)
days after receipt of the written notification of such claim denial. The Committee
shall make its decision regarding the merits of the denied claim within sixty (60) days
following receipt of the appeal (or within one hundred and twenty (120) days after such
receipt, in a case where there are special circumstances requiring extension of time
for reviewing the appealed claim). If an extension of time for reviewing the appeal is
required because of special circumstances, written notice of the extension shall be
furnished to the Claimant prior to the commencement of the extension. The notice will
indicate the special circumstances requiring the extension of time and the date by
which the Committee expects to render the determination on review. The review will
take into account comments, documents, records and other information submitted by the
Claimant relating to the claim without regard to whether such information was submitted
or considered in the initial benefit determination.

18

 

	 	b.	 	Disability Benefits. Appeal of a denied Disability benefits claim must
be filed in writing with the Committee no later than one hundred eighty (180) days
after receipt of the written notification of such claim denial. The review shall be
conducted by the Committee (exclusive of the person who made the initial adverse
decision or such person’s subordinate). In reviewing the appeal, the Committee shall
(1) not afford deference to the initial denial of the claim, (2) consult a medical
professional who has appropriate training and experience in the field of medicine
relating to the Claimant’s disability and who was neither consulted as part of the
initial denial nor is the subordinate of such individual and (3) identify the medical
or vocational experts whose advice was obtained with respect to the initial benefit
denial, without regard to whether the advice was relied upon in making the decision.
The Committee shall make its decision regarding the merits of the denied claim within
forty-five (45) days following receipt of the appeal (or within ninety (90) days after
such receipt, in a case where there are special circumstances requiring extension of
time for reviewing the appealed claim). If an extension of time for reviewing the
appeal is required because of special circumstances, written notice of the extension
shall be furnished to the Claimant prior to the commencement of the extension. The
notice will indicate the special circumstances requiring the extension of time and the
date by which the Committee expects to render the determination on review. Following
its review of any additional information submitted by the Claimant, the Committee shall
render a decision on its review of the denied claim.
	 
	 	c.	 	Contents of Notice. If a benefits claim is completely or partially
denied on review, notice of such denial shall be in writing and shall set forth the
reasons for denial in plain language.

	 	i.	 	The decision on review shall set forth (a) the specific reason
or reasons for the denial, (b) specific references to the pertinent Plan
provisions on which the denial is based, (c) a statement that the Claimant is
entitled to receive, upon request and free of charge, reasonable access to and
copies of all documents, records, or other information relevant (as defined
above) to the Claimant’s claim, and (d) a statement describing any voluntary
appeal procedures offered by the plan and a statement of the Claimant’s right
to bring an action under Section 502(a) of ERISA.
	 
	 	ii.	 	For the denial of a Disability benefit, the notice will also
include a statement that the Committee will provide, upon request and free of
charge, (a) any internal rule, guideline, protocol or other similar criterion
relied upon in making the decision, (b) any medical opinion relied upon to make
the decision and (c) the required statement under Section 2560.503-1(j)(5)(iii)
of the Department of Labor regulations.

	11.3	 	Legal Action. A Claimant may not bring any legal action relating to a claim for
benefits under the Plan unless and until the Claimant has followed the claims procedures under
the Plan and exhausted his or her administrative remedies under such claims procedures.

19

 

	11.4	 	Discretion of Committee. All interpretations, determinations and decisions of the
Committee with respect to any claim shall be made in its sole discretion, and shall be final
and conclusive.

Article XII

General Conditions

	12.1	 	Anti-assignment Rule. No interest of any Participant, spouse or Beneficiary under
this Plan and no benefit payable hereunder shall be assigned as security for a loan, and any
such purported assignment shall be null, void and of no effect, nor shall any such interest or
any such benefit be subject in any manner, either voluntarily or involuntarily, to
anticipation, sale, transfer, assignment or encumbrance by or through any Participant, spouse
or Beneficiary.

	12.2	 	No Legal or Equitable Rights or Interest. No Participant or other person shall have
any legal or equitable rights or interest in this Plan that are not expressly granted in this
Plan. Participation in this Plan does not give any person any right to be retained in the
service of the Company or any of its subsidiaries or affiliated companies. The right and power
of the Company or its subsidiaries to dismiss or discharge an Employee is expressly reserved.
Notwithstanding the provisions of Section 9.2, the Company makes no representations or
warranties as to the tax consequences to a Participant or a Participant’s beneficiaries
resulting from a deferral of income pursuant to the Plan or that the Plan complies in form or
operation with Section 409A of the Code and regulations issued thereunder.

	12.3	 	No Employment Contract. Nothing contained herein shall be construed to constitute a
contract of employment between an Employee and the Company or any of its subsidiaries or
affiliated companies.

	12.4	 	Headings. The headings of Sections are included solely for convenience of reference,
and if there is any conflict between such headings and the text of this Plan, the text shall
control.

	12.5	 	Invalid or Unenforceable Provisions. If any provision of this Plan shall be held
invalid or unenforceable, such invalidity or unenforceability shall not affect any other
provisions hereof and the Plan Administrator may elect in its sole discretion to construe such
invalid or unenforceable provisions in a manner that conforms to applicable law or as if such
provisions, to the extent invalid or unenforceable, had not been included.

	12.6	 	Governing Law. To the extent not preempted by ERISA, the laws of the State of
Florida shall govern the construction and administration of the Plan.

20

 

IN WITNESS WHEREOF, the undersigned executed this Plan as of the 23rd day of November,
2005 to be effective as of the Effective Date.

AutoNation, Inc.

	 	 	 	 	 
	 	 	 
	 	By:  	     /s/ Jonathan P. Ferrando
 	 
	 	 	Its:          Executive Vice President, General Counsel and Secretary 	 
	 	 	 	 
	 

21Exhibit 10.4(c)

 

EXHIBIT 10.4(c)

                                                   

	 	
		P. O. Box 5110

	 	

Denver, Colorado 80217

		
	 	

5500 South Quebec Street

		
	 	

Greenwood Village, Colorado 80111

		
	 	

Phone: (303) 740-4000

		
	 	

Fax: (303) 740-4002

 

September
2, 2005

Mr. Jay D. Nielsen

Chief Financial Officer

National Beef Packing Company, LLC

12200 N. Ambassador Drive, Suite 500

Kansas City, Missouri 64163

Re:    Fourth
Amended and Restated Credit Agreement (the "Credit Agreement") 

dated as of
December 29, 2004 between National Beef Packing Company, LLC 

("National  Beef"),
various Issuers, Lenders and Agents, and CoBank, ACB, as 

Administrative Agent

Dear Jay:

            By your letter of August 23, 2005 you requested
a waiver of the requirements of Section 10.6 of the Credit Agreement in
connection with your proposed sale of National Beef's 33,358 shares of the
Principal Financial Group.  I'm pleased to report that the Required Lenders
have authorized CoBank, as Administrative Agent, to agree to your request.  As
a result, subject to your countersignature below, National Beef may sell the
33,358 shares notwithstanding Section 10.6 of the Credit Agreement (and without
using up the $1 million "bucket" in Section 10.6(d)) so long as National Beef
uses the sale proceeds only for its ordinary working capital needs.

            By your countersignature below, you will agree
to the terms of this letter and will represent and warrant to the Lenders, the
Issuers and the Swing Line Lender that no Default or Matured Default will be
continuing at the time of the shares sale.

            Please understand that this waiver is applicable
only to this particular asset sale and that, except for this waiver, the Credit
Agreement will remain in full force and effect.

            This letter will be governed by and construed in
accordance with Colorado law, without regard to the application of conflict of
laws principles.  All terms used but not otherwise defined in this letter shall
have the meanings given them in the Credit Agreement.

 

 

1

Mr. Jay Nielsen

National Beef Packing Company, LLC

September 2, 2005

Page 2

 

 

	
   	
  Very truly yours,
	
    	
   
	
   	
  CoBank,
ACB, as Administrative Agent
	
    	
   
	
    	
   
	
  By:

  	
  /s/ James Stutzman

  
	
  Its:

  	
  Vice President

  
	
   	
   
  
	
   	
   
  
	
   	
  National Beef Packing Company, LLC
	
   	
   
  
	
   	
   
  
	
  By:	
  /s/ Jay D. Nielsen

  
	
  Its:	
  Chief Financial Officer

  

 

 

 

 

 

2

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