Help for item A.20.

GENERAL:

This definition of Compensation is generally used for allocating contributions. See item A.26 for the definition of Testing Compensation that is used applying plan limits and for testing purposes (e.g., Code section 415). The responses to questions regarding "Compensation" will have no effect on the definition "Testing Compensation".

The options include:

W-2. Wages within the meaning of Code section 3401(a) and all other payments of compensation to an Employee by the Employer (in the course of the Employer's trade or business) for which the Employer is required to furnish the Employee a written statement under Code sections 6041(d), 6051(a)(3), and 6052.

Withholding. Wages within the meaning of Code section 3401(a) for the purposes of income tax withholding at the source.

415 Safe Harbor. Only those items specified in Treas. Reg. section 1.415-2(d)(2)(i) and excluding all of those items listed in Treas. Reg. section 1.415-2(d)(3).

BASIC PLAN DOCUMENT:

Article 2 Definitions:

"Compensation" shall have the meaning set forth in the Adoption Agreement. If the Adoption Agreement provides that the Plan is a standardized plan: (i) Compensation shall also include any amount which is contributed by the Company pursuant to a salary reduction agreement and which is not includable in the gross income of the Employee under Code sections 125, 402(e)(3), 402(h) or 403(b), and (ii) Compensation shall include that compensation which is actually paid to the Participant by the Company during the Plan Year.

Compensation must be determined without regard to any rules under Code section 3401(a) that limit the remuneration included in wages based on the nature or location of the employment or the services performed (such as the exception for agricultural labor in Code section 3401(a)(2)). For any Self-Employed Individual covered under the Plan, Compensation will mean Earned Income.

For any Plan Year, the annual Compensation of each Employee taken into account for determining all benefits provided under the Plan shall not exceed $150,000 or such other amount in effect under Code section 401(a)(17)(B). The amount in effect for a calendar year applies to any determination period that begins during such calendar year.

If a determination period consists of fewer than 12 months, the annual Compensation limit is an amount equal to the otherwise applicable annual Compensation limit multiplied by a fraction, the numerator of which is the number of months in the short determination period, and the denominator of which is 12.

The foregoing is only intended to be a brief overview of applicable plan provisions. You should carefully review the entire Adoption Agreement and the entire Basic Plan Document to ensure that your responses to the Adoption Agreement questions accurately reflect the intended design of the plan.

Compensation