T. Rowe Price 401(k) Century Plan

Plan Administrator Manual

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TABLE OF CONTENTS

Plan Administration Overview 4 The Plan Administrator 4 The Trustee 4 DST Retirement Solutions, LLC, as Third-Party Recordkeeper/Administrator 5 Introduction to Plan Administration 5 How to Reach T. Rowe Price/DST Retirement Solutions, LLC 5 Plan Administration Overview 6 The Plan Documents 7 Setting Up Records for Your Plan 8 Overview of Transaction Procedures and Forms 8 Century Plan Sponsor Resource Center—Plan Sponsor Internet 9 Participation and Enrollment 9 Eligibility to Participate 10 Enrollment Procedures 11 Changes in Employee Data 12 Increasing Participation 13 Auto Services 13 The Pension Protection Act of 2006 (PPA) 15 Qualified Automatic Contribution Arrangement (QACA) 15 Eligible Automatic Contribution Arrangement (EACA) 17 Processing, Remitting, and Depositing Contributions and Payroll Data 17 Remitting Payroll and Participant Census Information 18 Funding of Plan Contributions 18 Pretax Salary Deferral Contributions 19 After-Tax Roth Salary Deferral Contributions 19 Pretax or After-Tax Roth Catch-Up Contributions 19 Loan Repayments 19 After-Tax Salary Deferral Contributions 20 Changes in Deferral Rate or Suspension of Deferrals 20 Employer Matching Contributions 20 Maximizing the Match a Participant Receives 20 Safe Harbor Employer Contributions 20 Additional Contributions 21 Employer Discretionary Profit Sharing Contributions 21 Rollover Contributions 21 Employee Investment Elections 23 Account Information 23 Investment Change Requests 23 Qualified Default Investment Alternative (QDIA) 23

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Distributions and Loans 25 General Rules Applicable to All Distributions 26 Methods of Distributions 27 Transaction Forms and Kits 27 Distributions as a Result of Separation From Service 28 Distributions as a Result of Total and Permanent Disability 28 Death Distributions 29 Involuntary (Forced) Distributions 29 In-Service Withdrawals 30 Post-Age 59½ Distributions 30 Withdrawals of After-Tax Accounts 30 Withdrawals of Roth Accounts 31 Hardship Withdrawals 31 Required Minimum Distributions (RMDs)—Age 70½ 32 Qualified Domestic Relations Order (QDRO) 34 Participant Loans 35 Compliance, Contribution Limits, and Nondiscrimination Tests 38 Annual Compliance Questionnaire 38 Compliance Services 38 Administrative Reports 38 Employer Administrative Reports 38 Participant Statements 40 Glossary of Terms 40 Alphabetical Listing of Terms 40

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The Plan Administrator The plan administrator, as a plan fiduciary, is legally responsible for the management and administrative duties of your plan. A primary responsibility is to run the plan solely in the interest of participants and beneficiaries and for the exclusive purpose of providing benefits and paying plan expenses. The plan administrator is identified in your plan’s adoption agreement, and the plan permits the employer to delegate specific plan administration duties to employees and others. Instructions in this manual are intended to assist this designated individual in performing the administrative duties of your plan. Some of the responsibilities of the plan administrator include:

Obtaining a fidelity bond for the plan (See pg. 42) Following the terms of the plan document in determining eligibility for plan

participation, vesting, and distribution of benefits Communicating plan provisions to employees and their beneficiaries Collecting and promptly reporting plan contributions to DST Retirement Solutions,

LLC Funding contributions within Department of Labor timing standards Monitoring contribution limits Ensuring that the plan operates in accordance with plan document provisions and

all applicable laws and regulations (e.g., coverage, participation, nondiscrimination) Maintaining and preserving records needed to supply/support all of the above Submitting complete and accurate employee census information in order to ensure

accuracy of reporting, testing, and transactional processing.

Note: Neither T. Rowe Price nor DST Retirement Solutions, LLC, will serve as the plan administrator of your plan.

The Trustee The trustee is the person or entity that is named in the adoption agreement and has agreed to serve as trustee. The assets of the plan are held separate from company assets and are safeguarded in a trust under the direction of the trustee. The trustee is a fiduciary of the plan and must exercise due care in safeguarding the assets of the plan for the exclusive benefit of the participants. The trustee may be a directed or discretionary trustee. A directed trustee is subject to the direction of the plan administrator, the employer, a properly appointed investment manager, a named fiduciary, or a plan participant with respect to the investment of plan assets. A directed trustee does not have any discretionary authority with respect to the investment of plan assets. A discretionary trustee has the authority and discretion to invest, manage, or control any portion of the plan assets without direction from any person or entity. Plan assets are invested in investment options made available by T. Rowe Price. The following are some responsibilities of the trustee:

Holds title to all plan assets Keeps records on investments, receipts, and disbursements involving trust assets Receives the company deposits and invests them according to the directions of the

plan participants and/or the plan administrator Disburses funds as directed by the plan administrator Provides limited-scope audit and certification letter, if required for Form 5500

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State Street Bank A plan sponsor may also choose State Street Bank as directed trustee. The following are some responsibilities of State Street Bank as directed trustee:

State Street shall maintain records of account for and report to plan participants quarterly as to purchases and sales and other confirmable transactions in plan participants’ accounts (through DST Retirement Solutions, LLC).

Register plan assets in the name of State Street as trustee of the plan for the benefit of the plan and the participants

Pay allowable and reasonable administrative expenses of the plan from the trust fund.

State Street serves as directed trustee of the plan but shall have no responsibility of the selection of any investments made for the plan other than to maintain the records thereof.

State Street shall not serve as “plan administrator” (as defined in the Employee Retirement Income Security Act of 1974, ERISA, as amended) of the plan or in any other administrative capacity, service, or in place of the plan administrator.

Adding State Street Bank & Trust as directed trustee for the plan requires the plan adoption agreement to be amended.

DST Retirement Solutions, LLC, as Third-Party Recordkeeper/Administrator The third-party recordkeeper/administrator handles much of the administrative work for the plan. The plan administrator directs the third-party recordkeeper/administrator on any action to be taken on behalf of the plan. The third-party recordkeeper/administrator does not serve as a fiduciary for the plan as defined by ERISA. The following are some responsibilities of the third-party recordkeeper/administrator:

Records salary deferrals, after-tax employee contributions, matching, other employer contributions, and loan repayments to each participant’s account at the direction of the plan administrator

Oversees the processing of loans and distributions Performs required annual compliance testing Prepares the summary annual report, DOL Form 5500, and certain other applicable

forms and attachments for plan administrator/plan sponsor review and authorization Sponsors/maintains prototype plan documents that may be adopted by the plan

sponsor Prepares the plan’s adoption agreement, as discussed with the plan contact, for

review by the client’s counsel prior to execution by the plan sponsor Prepares the summary plan description for review by the client’s counsel prior to

distribution to participant, beneficiaries, and alternate payees Prepares plan amendments as requested by the plan sponsor, for review by the

client’s counsel Introduction to Plan Administration How to Reach T. Rowe Price/DST Retirement Solutions, LLC T. Rowe Price has several offices and maintains regular business hours Monday through Friday. The numbers listed below are the main numbers for these locations. Your own retirement plan account manager (RPAM) may have a different telephone number specific to his or her location and department. T. Rowe Price also maintains a Web site at troweprice.com.

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Transaction requests and other correspondence should be mailed or faxed as follows:

Overnight Address Mailing Address T. Rowe Price Century 401(k) Plan T. Rowe Price Century 401(k) Plan 30 Dan Road P.O. Box 8374 Canton, MA 02021-2809 Boston, MA 02266-8374 Attn: DCS-CCSU Transaction Fax Line: 1-816-218-0424

Additional Ways to Contact Us Retirement Plan Account Manager:

Phone: 1-800-215-8659 Web site: troweprice.com/centuryplan The plan administration line is available business days, 8 a.m. to 8 p.m. eastern time. Overnight Address Mailing Address T. Rowe Price Century 401(k) Plan T. Rowe Price Century Plan 30 Dan Road P.O. Box 8374 Canton, MA 02021-2809 Boston, MA 02266-8374 Attn: DCS-CCSU

Client Relations Manager: Phone: 1-800-839-1901 E-mail: Century_Client_Relations@troweprice.com The client relations line is available business days, 8:30 a.m. to 5 p.m. eastern time.

Participant Access: Web site: rps.troweprice.com Plan Account Line (PAL): 1-800-354-2351 The participant automated service line is available 24 hours a day. PAL has speech recognition which allows participants to speak with a representative by saying “Representative.” The representative assistance line is available business days, 8 a.m. to 9 p.m. eastern time.

Plan Administration Overview This 401(k) Plan Administrator Manual has been prepared to assist you, the plan sponsor, with the administration of your 401(k) plan in accordance with plan documents and the applicable federal laws and regulations that govern the plan.

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The Plan Documents The plan documents most important to the administration of your plan are the following:

The Adoption Agreement This document states the plan provisions selected for your plan, along with the basic plan and trust documents, and governs the administration of your plan. It is generally the first place to look when you have a question about what your plan allows. Over time, you may find that the choices initially selected no longer meet the needs of your company. If this happens, please contact your RPAM about amending your plan’s adoption agreement.

The Basic Plan and Trust Documents These documents contain the provisions of your plan, which cannot be changed on an individual plan basis. It also governs the administration of your plan. Generally speaking, these are the provisions required by law to maintain both the qualified and prototype status of your plan. This document provides a detailed view of the requirements of your plan.

The Summary Plan Description (SPD) This document describes participant rights, benefits, and responsibilities under the plan in easy-to-understand language. Unlike the adoption agreement and basic plan and trust documents it summarizes, it does not govern the administration of your plan. It is meant to provide a summary of the plan to participants. It is often referred to as the “SPD.” The SPD must be distributed to all participants, beneficiaries, or alternate payees no later than 90 days after they become eligible to participate, 120 days after the plan is established, or at the request of a participant, beneficiary, or alternate payee.

Loan Agreement For plans that have elected in the adoption agreement to permit loans to participants and beneficiaries, a separate loan agreement outlines the specific provisions that govern plan loans. The plan administrator executes and administers the Participant Loan Program Agreement, and distributes a copy to participants and beneficiaries.

Opinion Letter and/or Determination Letter The Internal Revenue Service issues opinion letters on the form if the prototype plan sponsor’s documents meet the requirements to be considered a qualified plan. If your adoption agreement has been properly completed and you have chosen only options permitted under the terms of the approved plan, your plan may rely on the opinion letter issued to Boston Financial Data Services. If your adoption agreement contains other provisions, your plan may not be able to rely on this opinion letter. An application for a determination letter can be filed with the IRS. Once approved, your plan will receive one of these letters indicating the qualified status of your plan. Plans are not required by law to have a determination letter, but it is recommended as a precautionary measure.

Legal Regulators In addition to the documents that govern your plan, two government agencies are primarily responsible for enforcing the federal laws that heavily regulate and control the administration of your plan. The Internal Revenue Service, through the Internal Revenue Code and regulations, include rules concerning which employees must be covered by the plan, the level of retirement benefits that can be provided by the plan, and non-discrimination testing aspects of your plan.

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ERISA provides protections for participants and beneficiaries in employee benefit plans, including providing access to plan information. Those individuals who manage plans (and other fiduciaries) must meet certain standards of conduct under the fiduciary responsibilities specified in the law. The Employee Benefits Security Administration (EBSA) of the Department of Labor is responsible for administering and enforcing these provisions of ERISA.

Both agencies regularly issue new regulations and rulings that may affect the current and future administration of your plan. The administration of a 401(k) plan requires a coordinated effort among the plan administrator, the trustee, T. Rowe Price, and DST Retirement Solutions, LLC, as the third-party recordkeeper/administrator. The responsibilities of each party are briefly described below:

Setting Up Records for Your Plan The records for your plan should be organized to provide for accessibility and efficiency. It is recommended that you create separate files or binders for the following items:

Plan documents, including the signed adoption agreement, basic plan and trust documents, summary plan description, summary of material modification, signed service agreement, and all other legal documents

Annual tax return/reports, including DOL Form 5500 Compliance tests Record of contributions sent to T. Rowe Price/DST Retirement Solutions, LLC Loan agreement, amortization schedule, and payment record for each plan loan

Many plan administrators find it useful to have a “Pending Items” file to keep tabs on transactions and other items that have not been completed. Overview of Transaction Procedures and Forms Each section of this manual describes the steps and the forms necessary to complete various plan-related transactions. Administrative forms are updated periodically for administrative purposes and to reflect changes in the laws governing qualified plans. Please make sure you are using the most updated forms to ensure compliance with current law. These forms are available on the Century Plan Sponsor Resource Center at troweprice.com/centuryplan. The following are the routine events and transactions that compose plan administration:

Establish new employees on the recordkeeping system, as they are hired. Notify employees of eligibility and provide enrollment forms prior to eligibility, Update employee census data as needed. Calculate salary deferral deductions each payroll period. Determine any applicable contributions as well as loan repayments. Forward to T. Rowe Price, within the Department of Labor timing standards, all

money deferred to the plan by plan participants, including loan payments. Implement participant-initiated changes, such as distributions and loans. The

appropriate forms will need to be filled out, signed, and submitted to DST Retirement Solutions, LLC, for processing.

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Note: Certain transactions involving plan assets and “parties-in-interest” are considered self-dealing and are prohibited by federal law. Such a transaction occurs when funds from the trust are used to benefit a fiduciary, plan sponsor, or other person involved with the plan. Self-dealing is the conduct of a trustee, attorney, a corporate officer, or other fiduciary that consists of taking advantage of his or her position in a transaction and acting for his or her own interests rather than for the interests of the beneficiaries of the trust.

Century Plan Sponsor Resource Center — Plan Sponsor Internet As part of the plan setup process you, the plan sponsor, will have access to the CPSRC. The CPSRC is an Internet-based application that facilitates the transfer of information between your company, T. Rowe Price, and DST Retirement Solutions, LLC. The CPSRC ultimately means efficiency, accuracy, and reliability for you and your employees. Additionally, the plan sponsor may grant CPSRC access to third-party service providers such as payroll providers, consultants, and advisors. These service providers may use the site to transfer information on behalf of your plan and perform tasks such as payroll submission and maintenance. The plan sponsor can change access for a third-party at any time. You will use the CPSRC for the following plan activities:

Provide an initial census file that includes: Social Security number, name, address, city, state, ZIP, status, birth date, hire date, rehire date, affiliate code, and employee ID number.

Establish new employee records via payroll files or by manual entry in the CPSRC, Update existing participant census information as required, (e.g., name, address,

city, state, ZIP, status, birth date, hire date, rehire date, affiliate code, employee ID number, etc.).

View an existing participant’s personal, investment allocation, compensation, compliance, and investment information.

View a participant’s available loan balance and model a new loan. Provide a means to send contributions, loan repayments, and salary and hours

rosters. Build a new roster based upon a prefilled spreadsheet Model an existing or previously submitted roster Edit or release a previously created, unsubmitted roster (work in progress) Delete a previously created, unsubmitted roster (work in progress) View a previously submitted roster (display only)

Participation and Enrollment When your 401(k) plan is first established, it is important that meetings are held with the employees to describe the features of the plan, the investment options, and how the plan will operate. These meetings should be held periodically as new employees become eligible. Eligible employees who have elected not to defer part of their salary should also be invited to enrollment meetings. Company and plan objectives are more successfully met when employee participation rates are high. T. Rowe Price supplies the plan administrator with enrollment kits and plan investment information.

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Eligibility to Participate New Employees—Determining Entry Dates and the Date of the First Payroll Deduction New employees are eligible to participate in the plan on the first entry date after the plan’s eligibility requirements are met. Your adoption agreement indicates your plan’s eligibility requirements. All eligible participants should be notified prior to or upon reaching their eligibility date; asked to complete an enrollment form and a designation of beneficiary form, even if they decide not to contribute; or asked to enroll online depending on the plan’s process. The plan administrator should collect the completed forms in a timely manner so that the information can be entered to both your payroll system and CPSRC in time to process contributions on the first applicable payroll period. No contributions may be made on behalf of an eligible employee before the appropriate plan entry date for that employee. It is the pay period, not the pay date, that determines when contributions can first be made. It is necessary to wait until a pay period that contains the plan entry date before contributing. For example, if the plan entry date is 7/1/09 and the pay period that includes the date runs from 6/25/09 to 7/8/09, then payroll deductions could begin during that pay period. It is important for the plan administrator to monitor employee eligibility. A plan risks disqualification if it fails to provide enrollment information to an eligible employee or make contributions for eligible employees. An eligible employee may choose not to make salary deferrals to the plan. All eligible employees, whether contributing or not, are considered participants. An employee who does not contribute an amount from his or her salary may still make a rollover contribution, if permitted by the plan, or receive an employer contribution as described in the plan’s adoption agreement. Therefore, it is essential to collect enrollment information including investment allocations and a designation of beneficiary prior to any contribution being made. If online or phone enrollment is allowed by the plan, eligible employees should contact T. Rowe Price though the myRetirementPlan Web site or by calling Participant Services to make salary deferral and asset allocation elections. When online or phone enrollment is not allowed, a salary deferral form should be collected by the plan sponsor. Eligible employees should contact T. Rowe Price though the myRetirementPlan Web site or by calling Participant Services to set contribution allocation elections. The plan sponsor must initially establish the eligible employee’s account using CPSRC by either manually entering or uploading census information. A RPAM will provide instructions for each process. Rehired Employees Rehired employees who previously were participants in the plan generally are allowed to enter the plan immediately upon rehire as long as they are in an eligible class of employees. These employees do not have to wait for an entry date to become participants. A rehired employee who was not a participant during his or her previous employment period usually must be credited with prior service unless he or she has incurred a break in service as defined in your plan documents. Such an employee would become eligible to participate on the first entry date following satisfaction of the plan’s eligibility requirements.

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Exclusion of Employees Some plans exclude certain classes of employees from participation in their plan. The adoption agreement must indicate that these employees are excluded or the plan could be disqualified for preventing eligible employees from participating. The classes of employees most commonly excluded are employees subject to a collective bargaining agreement and nonresident alien employees with no U.S. source of income. An employee who goes from an excludable class to an eligible class, and who has otherwise met the plan eligibility requirements, will be immediately eligible to enter the plan without having to wait for the next entry date. The plan’s adoption agreement describes which classes of employees are eligible to participate in the plan. Part-Time Employees Part-time employees are not considered a class of employees that can be excluded from participation in a plan. Each part-time employee’s hours must be checked to see if he or she has met the eligibility requirements of the plan. Please note that if your plan’s service requirement is less than one year, it cannot have a minimum hours of service requirement. This means that all part-time employees, if not excludable for some other reason, would be eligible to participate as soon as they meet the plan’s age and service requirement, regardless of the number of hours the participant worked during that period. Eligibility Tracking This service, if elected by the plan, assists the plan administrator by tracking the eligibility requirements by contribution type as set forth in the plan’s adoption agreement. Plan entry dates and entry frequency are tracked based on the plan’s eligibility criteria. Participants are added to the CPSRC with a status of N (Not Eligible). When all eligibility criteria are met, the status is automatically changed to E (Eligible). The participant’s status will automatically change to A (Active) once the first contribution is received. Enrollment Procedures T. Rowe Price will provide the plan administrator with enrollment kits. An enrollment kit and SPD should be given to each employee who has satisfied the eligibility requirements elected in the adoption agreement. Refer to page 7 for the SPD requirements. Record the date the enrollment kits were distributed to eligible employees. The enrollment kit contains:

Salary Deferral Election Form Designation of Beneficiary Form Information for each fund investment fund offered under the plan Supplemental materials, e.g., Asset Allocation that may be provided by T. Rowe

Price The Designation of Beneficiary Form is always provided to the plan administrator. The Salary Deferral Election Form is returned to the plan administrator, or when allowed by the plan, the participant completes the salary deferral and investment election enrollment online or by phone. Participants always contact T. Rowe Price to make investment elections (online or by phone).

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Upon receipt of the Salary Deferral Election Forms, review and verify that they have been properly completed. The most common problems are missing participant signatures, and missing dates of birth and/or hire. Request that the employee complete any missing data. Update the CPSRC with the information from the enrollment forms. See the CPSRC manual for instructions on recording a newly eligible employee and initial investment allocations. File the original Salary Deferral Election Form and Designation of Beneficiary Form in the employee’s personnel file. Do not send copies of these forms to T. Rowe Price or DST Retirement Solutions, LLC. If an employee fails to return the enrollment forms, the plan administrator may want to send a second copy by registered mail to the employee. A cover letter might state that a Salary Deferral Election Form and Designation of Beneficiary Form must be completed and returned whether or not salary deferral contributions have been elected. Staple the registered mail receipt to a copy of the cover letter and maintain it in the employee’s personnel file. Online Enrollment: This feature allows employees to enroll in the plan, establish or change salary deferral amounts, and select investment allocations online using the T. Rowe Price Participant Web site. Employees are issued a personal identification number (PIN) that allows access to their account when they are added to the recordkeeping system. If an employee doesn’t have a PIN, there is a registration process that allows them access to their account, Online Enrollment also allows employees to decline enrollment or opt out of certain features. Standardized Reporting is the tool that will assist the plan administrator in updating the payroll system with new enrollments and deferral percentages. Reports are set up to run according to payroll dates, change frequencies, and entry dates. Note: It is important that all eligible employees complete enrollment forms and designate a beneficiary in the event that employer contributions, such as discretionary profit sharing contributions, forfeiture reallocations, or corrective contributions are made. Changes in Employee Data When employee data, such as dates and addresses change, the plan sponsor will need to make these changes on the CPSRC. This will systematically update this information to the recordkeeping system. The original change form should be maintained in the employee’s personnel file. Do not send copies of these forms to T. Rowe Price or DST Retirement Solutions, LLC. The CPSRC can assist the plan sponsor with updates and changes to salary deferral rates via Auto Services on the CPSRC. Using Online Enrollment, participants can initiate, change, or stop their salary deferrals. Reports are created in Standardized Reporting to assist the plan and the payroll department or vendor in updating participant deferrals in the payroll system. Employees may only change their investment allocations or request exchanges by calling the participant servicing number using the voice response unit, speaking with customer service, or by accessing the myRetirementPlan Web site. The toll-free number and the myRetirementPlan Web site are listed on participant statements as well as in the How to Reach T. Rowe Price/DST Retirement Solutions, LLC, section of material. Participants may change their investment choices using the automated systems or by speaking to a customer service representative.

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Increasing Participation Increasing participation in the plan can help promote greater employee benefit satisfaction and help your plan pass compliance testing. The following is a list of common ways to increase participation (some require plan amendments, which your RPAM can assist you with):

Give your employees information about the plan. Regularly tell your employees about your plan and the benefits of saving.

Hold regular 401(k) meetings. The more opportunities you give your employees to sign up for the plan, the more likely they are to join.

Match your employee salary deferrals or increase the match your plan currently offers. Employer matching contributions tend to promote savings.

Eliminate or reduce the waiting period for employees to enter the plan. However, this change may have negative effect on compliance testing for companies that have high turnover or a large population of part-time employees with low wages.

Add Auto Services such as Automatic Enrollment, Auto Investment, and Auto Deferral Increase along with Online Enrollment to your plan.

Contact a T. Rowe Price relationship manager at 1-800-839-1901 for educational materials and to review the design and education options that will help increase participation.

Auto Services To help simplify the employee challenges of saving for retirement and selecting investment options, many plan sponsors are now choosing automated services to help participants save and prepare for a financially secure retirement. Each Auto Services feature allows the participant the flexibility to opt out and make his or her own choices. The available services include:

Automatic Enrollment: Also known as auto enroll, passive enrollment, or negative elections, this feature automatically enrolls participants at a plan-determined deferral rate specified in the adoption agreement. Automatic Enrollment requires Eligibility Tracking be turned on and works well in conjunction with Automatic Investment and Auto Deferral Increase. The plan sponsor is required to provide a 30-day notice to plan participants informing them of the Automatic Enrollment feature and how to opt out.

o During the enrollment period prior to each entry date, all eligible employees can

use the Web site or Participant Services to decline enrollment or to enroll themselves, choosing their own deferral percentage and investment selections. If an employee does nothing, he/she is then enrolled in the plan at the sponsor selected default deferral percentage and the sponsor selected default investment.

o Participants can make changes to their deferral percentages at any time via the

Web site or Participant Services to be effective as of the next change date (as elected in the adoption agreement).

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o The plan administrator needs to provide up to date census and status information via the CPSRC. Accurate census data are essential. Once entered into the system, all data must be maintained. Census data must be provided for all employees who are not excludable from the plan, regardless of eligibility status, and any employee who participated in the plan and terminated employment, retired, or died during the plan year.

Required census data includes:

• Social Security number, name, and address • Accurate date of hire and date of birth • Hours (if required to become eligible) • Entry date (if not system calculated – see Eligibility Tracking) • Applicable status code: N - Not eligible or E - Eligible. (Status code E

requires the plan entry date also be entered onto the recordkeeping system.)

Auto Investment: Using the T. Rowe Price Retirement Funds, this feature will invest

participant contributions in the appropriate fund based on the participant’s date of birth and based on the year the participant will attain age 65. Participants are not required to select contribution allocations since this feature will automatically invest contributions into the appropriate retirement date fund. Participants may also choose to make their own investment elections. The notice requirement for all eligible employees is not more than 90 days before the initial eligibility date, and the annual notice requirement is satisfied if provided at least 30 days (and not more than 90 days) before the beginning of each plan year. Both notices must include fund fact sheets for the default investment options.

It is of utmost importance that the recordkeeping system has accurate birth dates for all employees as this date drives the determination of which investment option is to be used for each participant. Care must be taken to avoid a participant being invested into the wrong fund.

Auto Deferral Increase: With this service, participant deferral percentages are automatically increased by a certain percentage annually. The plan sponsor chooses the incremental percentage by which deferrals will be increased, and the annual date on which the increase will occur and specifies the maximum deferral percentage. If you use Automatic Deferral Increase in conjunction with Automatic Enrollment, all new participants will be automatically enrolled in Auto Deferral Increase unless they choose to opt out. Existing employees also may use Auto Deferral Increase, but will need to enroll in the service. If you use Auto Deferral Increase without Automatic Enrollment, all participants will need to enroll in the service.

Auto Rebalance: This service allows a participant to choose his or her own portfolio

investment mix from the plan’s selected investment options and have assets automatically rebalanced based on his or her choice of frequency.

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Choosing Auto Services for Your Plan A T. Rowe Price client relations consultant (CRC) can assist you in determining the Auto Services features that are right for your plan. A 401(k) Century Plan Services Form is then completed and sent to your RPAM. They will review the services requested along with the plan’s adoption agreement to determine if an amendment is required. If applicable, an amendment will be prepared and sent to the plan sponsor for review and signature(s). The cost for the amendment is $450. Once the completed 401(k) Century Plan Services Form is received, and the adoption agreement amendment is executed (if applicable), the requested Auto Services features are activated. Your CRC and RPAM will assist you with required notices and educational materials for you and your plan participants. Accurate census data are essential for the Auto Services features to work correctly. All employees must be entered onto the CPSRC and their data must be maintained. Something as simple as an incorrect date of birth could affect a participant’s investments. The plan administrator must monitor reports for additions and/or changes to participant enrollment and deferrals and coordinate these additions and/or changes with their payroll systems or payroll provider. The Pension Protection Act of 2006 (PPA) The PPA provides new incentives for implementing auto services in 401(k) plans on or after January 1, 2008. Qualified Automatic Contribution Arrangement (QACA) Automatic Enrollment Safe Harbor 401(k) Starting in 2008 A QACA is a new safe harbor automatic enrollment program. Among the advantages of a QACA is its exemption from nondiscrimination testing and generally top-heavy testing. The QACA rules apply to plan years beginning on or after January 1, 2008. A QACA must be implemented before the plan year begins. Plan amendments implementing a QACA safe harbor must be adopted before the first day of the plan year and must remain in effect for an entire 12-month plan year. Safe Harbor Rules The following are the requirements for establishing a QACA. Note that a key advantage of a QACA is that its required matching contribution is less than a 401(k) safe harbor plan's matching contribution.

Minimum Automatic Deferral Percentage. A QACA must have a minimum specified automatic contribution percentage that is uniformly applied to all eligible employees who do not make an affirmative election. That percentage will escalate in the second, third, and fourth plan years of an employee's participation.

During the initial period, the automatic deferral percentage must be at least 3% (but no more than 10%) of compensation.

The initial period begins on the first day the employee participates in the QACA and ends on the last day of the following plan year (potentially as long as two years).

After the initial period, the minimum required percentage increases 1% per year until it reaches at least 6%.

A QACA can provide for a higher percentage than is required, but the percentage cannot exceed 10% of compensation.

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Eligibility Exceptions. The automatic enrollment rules apply to all employees who are eligible to defer.

The regulations allow current employees who were eligible for the plan prior to the QACA’s effective date and who had a current election to be excluded from the automatic deferral percentages.

Employees who have filed an election not to defer (a 0% election) are also excluded. This election must be an affirmative 0% election and not merely a failure to make an election.

Automatic enrollment rules apply to all employees who have not made any elections.

Minimum Contribution Requirements. Employers implementing the QACA must make a minimum nonelective or basic matching contribution for all participating non-highly compensated employees. They may either make:

A matching contribution of 100% of the first 1% of compensation deferred plus 50% of the deferrals that exceed 1% but that do not exceed 6% (for a maximum match of 3.5% of compensation on the first 6% deferred). In this case, a plan can use an enhanced match as long as it meets the basic match requirements. For example 100% of the first 3.5% deferred would be acceptable match formula.

OR

A nonelective contribution of at least 3% of compensation to all eligible non-highly compensated employees.

The safe harbor contribution may be provided to highly compensated employees also.

Distributions. An in-service distribution of safe harbor contributions and deferrals may not occur prior to age 59 ½. Deferrals may be hardship eligible; however, safe harbor contributions may not be withdrawn due to hardship.

Vesting. Employer contributions used to satisfy the safe harbor must be 100% vested after an employee has completed no more than two years of service. Note that this is another key advantage of a QACA. For example, in regular 401(k) safe harbor arrangements (i.e., those that are not QACAs) immediate full vesting of safe harbor contributions is mandated.

Notice Requirements. Within a reasonable time (no more than 90 days and no less than 30 days) before the beginning of each plan year, employees who are eligible to participate in the QACA must receive written notice of their rights and obligations regarding automatic enrollment.

For immediate eligibility, the employee notice must also be provided when an employee is hired (if it is within 30 days of becoming eligible).

The notice must explain the employee's right to decline automatic enrollment or to change his or her election amount, including the right to stop deferrals.

The regulations indicate that certain QACA explanations cannot be provided by reference to the plan’s SPD

Contact T. Rowe Price or your RPAM for more information on QACAs and sample notices.

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Eligible Automatic Contribution Arrangement (EACA)

In addition to the QACA program, the PPA provided for another contribution program that does not require employer contributions or minimum and maximum automatic deferral amounts. The EACA establishes guidelines for plan sponsors to add automatic deferral arrangements to their plans without some of the restrictions of a safe harbor provision. Plans with EACA provisions are required to perform annual compliance testing.

An EACA is defined as an arrangement under which:

A participant may elect to have the employer defer compensation as contributions to the plan.

Deferrals will continue until the participant elects otherwise. Unless other investment directions are provided by the participant, the contributions are

invested in a qualified default investment alternative (QDIA). Participants are provided a notice that satisfies the QDIA notification requirements (See

QDIA regulations under section 404(c)(5) (QDIA) of the ERISA and notice requirements in the chapter on Employee Investment Elections in this manual.)

Annual Notice Requirement for Safe Harbor Plans The plan administrator is required to provide an annual notice that states that the employer intends to deposit a safe harbor contribution to the plan in the following year. The notice must also explain that by making this contribution, the plan may be exempt from some forms of nondiscrimination testing. The notice must be provided no earlier than 90 days and no later than 30 days prior to the start of the plan year for which the contribution will be made or, in the case of a new employee, not more than 90 days before the employee is eligible to participate. For calendar year plans, this notice is distributed between October 3rd and December 1st. Permissive Distributions for EACAs. Plans with EACAs are permitted, but not required, to allow all employees eligible under the EACA a 90-day window (beginning on the date of the first automatic deferral) to withdraw automatic deferrals. These distributions are includible in the employee’s taxable income in the year of distribution, are not subject to any 10% early withdrawal penalty, and are not eligible for rollover distributions. Any gains or losses would be added or subtracted, as appropriate, to the distribution. Any associated match is forfeited to the plan (it is not distributed to the participant or the employer). Testing Changes. EACA plans will have six months (rather than two and a half months) after the end of the plan year to perform the average deferral percentage/average contribution percentage (ADP/ACP) testing and make corrective distributions without penalty, if necessary. Processing, Remitting, and Depositing Contributions and Payroll Data Plan administration requires coordination of resources at your firm. he plan administrator should establish internal procedures to ensure that the plan is administered in an efficient and accurate manner.

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Remitting Payroll and Participant Census Information Each payroll period, the plan sponsor must provide certain information to T. Rowe Price, including updated participant census information, payroll information, the contribution per money source, and any loan repayment (if applicable), per employee. The data on most payroll software programs may be imported directly into the CPSRC.

Funding of Plan Contributions Automated Clearing House (ACH) is the preferred funding method. T. Rowe Price will debit the employer’s bank account via ACH to fund plan contributions. An additional fee applies for check or wire funding methods.. Based on plan provisions, contributions to a qualified plan may include:

Employee pretax, Roth or catch-up salary deferral contributions Employee after-tax contributions Employee loan payments Employer matching contributions Employer safe harbor contributions Employer discretionary contributions Other employer contributions

Funds must be deposited to the plan in a timely manner. Department of Labor regulation section 2510.3-102 requires that employers deposit participant contributions and loan repayments to the plan by the earliest date contributions can reasonably be segregated from the company’s assets. The Department of Labor believes that most employers should be depositing deferrals to the plan within two to 10 business days, depending on the size of the company.

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Pretax Salary Deferral Contributions Salary deferral contributions are amounts deferred by employees from their wages in accordance with their elections via enrollment forms, salary deferral forms or, by an Automated Service. Salary deferrals may also include auto enroll deferrals. Deferrals are made as a percentage of employee’s salary up to the limit established in the adoption agreement. Salary deferral contributions are also limited by federal law and must not exceed the prevailing annual limits. Internal Revenue Code section 402(g) limits salary deferral contributions to the lesser of the prevailing annual dollar limit or 100% of the employee’s compensation. There is also a cap on the amount of gross compensation eligible for deferrals. Finally, salary deferral and other additions or contributions with respect to an individual cannot exceed the maximum allowable limits as indexed by the Internal Revenue Service. If an employee’s compensation varies from paycheck to paycheck, it is important to calculate deferral amounts correctly to prevent an operational violation. An operational violation occurs when a participant’s contribution is greater than the limits established in the adoption agreement and applicable federal limits. The plan may be required to refund excess contributions to the participant. Employee salary deferral contributions are tax-deferred and are deducted from their salary before federal and some state income taxes are assessed. However, Federal Insurance Contributions Act and Federal Unemployment Tax Act are assessed on all wages including salary deferral contributions. After-Tax Roth Salary Deferral Contributions A Roth contribution is an elective contribution that is treated by the employer as includable in the employee’s gross income. It is a salary deferral made on an after-tax basis rather than a pertax basis and is considered part of a participant’s total elective contribution amount. Your plan would need to adopt the Roth provision in order to accept Roth contributions. Since these contributions are made on an after tax basis, their tax treatment when distributed from the plan is different from that applied to the distribution of pretax amounts. For information on the tax treatment of Roth distributions, please see the chapter on distributions in this manual. Pretax or After-Tax Roth Catch-Up Contributions If a participant will attain age 50 or older by the end of the taxable year and is unable to make additional deferrals because of legal, plan, or ADP restrictions, then the participant can make catch-up contributions. Catch-up contributions are a type of salary deferral that allows participants who are age 50 and older to increase their contributions to their 401(k) plan. The amount of catch-up contributions allowed is subject to annual limits set by the Internal Revenue Service and is adjusted periodically to reflect cost-of-living increases. Catch-up contributions may be either pretax and/or after-tax Roth salary deferral contributions. Your adoption agreement must include a catch-up provision to allow catch-up contributions. Loan Repayments Loan repayments to the plan are deducted from salary on an after-tax basis or by certified check from the participant for a lump-sum payoff. For additional information on loans, refer to the Distribution and Loan section in this manual.

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After-Tax Salary Deferral Contributions After-tax salary deferral contributions are voluntary contributions made to a plan by an employee that are included in gross income and are subject to FICA, FUTA, and other income taxes. A voluntary contribution differs from a Roth contribution in that it is not considered an elective salary deferral contribution and is subject to different tax treatment. Please contact your RPAM for information regarding the tax treatment of voluntary contributions. Changes in Deferral Rate or Suspension of Deferrals An employee may change his or her salary deferral amount only at the times designated by the adoption agreement and/or the plan and trust documents. The plan administrator may set a deadline for receipt of changes in order to allow sufficient lead time for processing. Employees may suspend their salary deferral contributions at any time. A deferral suspension is effective as soon as administratively feasible after the plan administrator is notified. Employees who suspend their salary deferral contributions may resume deferrals at the times designated by the plan documents. Participants should go online, call the Client Services group, or submit a change form to the plan administrator to request a change to the deferral rate being contributed. Once acted upon, the change form should be filed in the employee’s personnel file. Do not send copies of these forms to T. Rowe Price or DST Retirement Solutions, LLC. Plan sponsors are responsible for monitoring deferral change reports under Standardized Reporting on the CPSRC. Employer Matching Contributions Each employee making salary deferral contributions may be entitled to receive an employer matching contribution equal to an amount specified in the adoption agreement. Under federal law, the compensation eligible for inclusion in the plan’s match formula is restricted to the IRS annual compensation limit. In addition, an individual’s matching and other contributions cannot exceed the maximum allowable limits as indexed annually by the IRS. Maximizing the Match a Participant Receives If the plan’s adoption agreement requires the match to be computed on an annual basis, but the employer deposits these contributions on a more frequent basis, a year-end adjustment may be required. This practice is called “front loading of contributions” and may result in the participant not receiving the maximum match allowed by the plan. DST Retirement Solutions, LLC, will assist you with the calculation of a maximum match contribution, also called a true-up match, as requested. Additional fees may apply for the calculation. Safe Harbor Employer Contributions Plans are permitted to allow employers to make a “safe harbor” contribution. A safe harbor contribution must be immediately 100% vested. If this type of contribution is made, annual nondiscrimination testing for salary deferrals and matching contributions generally is not required.

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Effective for plan years beginning after 12/31/2007 a new type of safe harbor plan, a QACA, was created by the PPA. QACA plans offer an automatic enrollment feature, an automatic deferral increase feature and a minimum employer contribution of either a 3% safe harbor nonelective contribution or a safe harbor matching contribution of at least 100% of the first 1% deferred and 50% of deferrals that exceed 1% but that do not exceed 6%. Employer contributions in a QACA plan must be 100% vested within two years and are required to be made only for non-highly compensated employees. If you are interested in more information about safe harbor plans, please contact T. Rowe Price or your RPAM. Additional Contributions The company may be required to make additional contributions to satisfy the nondiscrimination testing or to meet the top-heavy minimum contribution requirements. You may wish to seek guidance on the allocation process from your tax advisor. An allocation determines the portion of the contribution that will be credited to each eligible participant’s account. Additional contributions are also submitted in a roster via the CPRSC. Employer Discretionary Profit Sharing Contributions If the adoption agreement allows, the company may make an employer discretionary profit sharing contribution. This contribution is allocated to all employees who have met the eligibility requirements defined in the plan document. Plan participants may receive this type of contribution whether or not they chose to participate in the plan by making salary deferral contributions. Under federal law, the compensation eligible for an employer discretionary profit sharing contribution is restricted. In addition, discretionary profit sharing and other additions or contributions with respect to an individual cannot exceed the maximum allowable limits as indexed by the Internal Revenue Service. It is the plan administrator’s responsibility to notify DST Retirement Solutions, LLC, of the company’s intent to make an employer discretionary profit sharing contribution. Upon request, DST Retirement Solutions, LLC, will assist the company in calculating its discretionary profit sharing contribution in accordance with the terms of the plan. The calculation will be based upon information provided by the plan administrator. It is the plan administrator’s responsibility to ensure that DST Retirement Solutions, LLC, is provided with complete and accurate information and to review the allocation for accuracy. The plan administrator should ensure that all eligible participants have completed enrollment and beneficiary forms, even if they are not making salary deferrals. The Century Plan Sponsor Resource Center should be updated with this participant information to ensure that profit sharing contributions are initially invested in accordance with participant investment choices. Once the individual participant account is established, employer discretionary profit sharing contributions are submitted in a roster via the CPRSC. Rollover Contributions Rollover contributions are contributions made to the plan by an employee from another eligible retirement plan. When the plan allows for rollovers, the plan administrator is responsible for determining whether each rollover contribution may be accepted by the plan. Subject to approval, participants may make rollover contributions before they are eligible to participate in the plan as defined in the adoption agreement. Rollover contributions will appear as a separate line item on the participant’s statement.

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Follow the steps below for each rollover contribution:

Provide the employee with the appropriate rollover kit, investment information, and for new employees, enrollment material and a summary plan description.

The participant should certify that the money is qualified to be rolled over by signing the rollover form. This is to ensure that the money rolled over is eligible for deposit. The plan administrator may require additional documentation as it deems necessary.

The participant submits the completed forms and the rollover check from to the plan administrator. Note that there are two types of rollovers:

o An indirect rollover occurs when a distribution is received by a participant from another plan or an IRA and then deposited into the plan within 60 days following the participant's receipt of the distribution. The participant may need to provide alternative documentation if the check was cashed. The plan administrator must verify that the date on the rollover check is no more than 60 days old. Distributions, made payable to a participant, may not be rolled over if the check is dated longer than 60 days. Rollover amounts must be deposited within a 60-day period. The participant has the option of writing a personal check for the taxes withheld and rolling over that amount as well.

o With a direct rollover, the rollover check is made payable directly to the plan

for the benefit of a participant. The 60-day time limit is not applicable. These types of rollovers can be deposited as long as the check is still valid. Rollover funds may also be wired directly to T. Rowe Price for deposit to the participant’s account. The plan administrator provides a copy of the rollover form to DST Retirement Solutions, LLC for processing with the rollover deposit. The participant is responsible for contacting the qualified plan to initiate the rollover to T. Rowe Price.

Rollover checks received without a corresponding rollover form will be returned to

the plan. Note: The participant will receive a form 1099-R from the previous retirement plan.

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Employee Investment Elections A participant may invest his or her account balance in any of the investment choices offered by the plan. This section describes how participants may obtain account information and change investment selections. Account Information Participants may access their accounts through the following methods:

Representative Assistance Line: 1-800-354-2351. Business days, 8 a.m. to 9 p.m. eastern time.

Voice System: Plan Account Line (PAL) by calling 1-800-354-2351. This is an automated voice response information system. The participant’s PIN is the last four digits of his or her Social Security number. Participants are prompted to select a PIN during the first call.

Participant myRetirement Plan Web site: Online Access through the Internet at rps.troweprice.com.

Account access provides participants with:

Total account balance Balance by fund and money source Total vested account balance Investment allocation elections (how future contributions are invested) Investment changes (both for current account balances and future contribution

allocation elections) Investment and market information Account transaction history Loan information (including loan modeling), if allowed by the plan Online statements Tools and calculators

Investment Change Requests On any day, using any of the access methods described above, participants may:

Change investment choices for future contributions Transfer existing account balances among the investment choices offered by the

plan

Changes made after the stock market has closed (generally, Monday through Friday at 4 p.m., eastern time) will not be effective until the next business day. Qualified Default Investment Alternatives (QDIA) On October 24, 2007, the DOL issued final regulations applicable to QDIAs under participant-directed individual account plans. These regulations extend ERISA Section 404(c) fiduciary relief for decisions to invest plan assets in default investment funds as long as those funds meet QDIA requirements.

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Under ERISA Section 404(c), fiduciaries may be relieved of liability for participants’ investment decisions. Relief may be available if: participants are able to exert control over their investments, a broad range of investment choices is made available, and participants are provided appropriate information about their selections. Default investment alternatives historically have not been eligible for Section 404(c) relief because participants did not make the affirmative investment decision. The DOL regulations solve that problem by extending Section 404(c) protection to QDIAs. For notices issued after November 24, 2007, protection becomes available 30 days after the notice is issued. Permitted QDIAs

A QDIA is generally described as a balanced fund, a life-cycle fund (based on the participant’s age or target retirement date), or a professionally managed account.

A QDIA must be managed by an investment manager, a plan trustee, a plan sponsor, or an investment company registered under the Investment Company Act of 1940.

The final regulations exclude capital preservation funds, such as money market or stable value funds, as permitted QDIAs. Investments in stable value funds, however, are provided grandfather protection under certain circumstances for investments made prior to December 24, 2007.

In addition, plans that provide for automatic enrollment arrangements under Code Section 414(w) may invest participant contributions in a capital preservation QDIA (such as money market or stable value funds) for up to 120 days if the participant is given an opportunity to opt out of the fund and withdraw those amounts within 90 days in accordance with the “automatic unwind” provisions of Code Section 414(w).

QDIA Requirements Under the final rules, a fiduciary will be afforded ERISA Section 404(c) relief for QDIAs, provided that the fiduciary prudently selects the QDIA fund and meets all of the following conditions:

Each participant is given an opportunity to direct the assets in his or her account but does not do so.

Participants and affected beneficiaries are furnished an advance notice (both before initial investment in a QDIA and an annual QDIA notice) that describes the circumstances under which plan contributions will be invested on their behalf in a QDIA.

Participants are automatically provided investment information relating to the QDIA, such as a fund prospectus.

Defaulted participants are permitted to transfer out of the QDIA with the same frequency afforded other participants, but at least once each quarter.

No restrictions, fees, or expenses are imposed by the QDIA during the 90-day period beginning on the date of the participant’s first contribution.

The plan offers a broad range of investment alternatives that satisfy ERISA Section 404(c).

QDIA Notices Advance notice pertaining to a QDIA must be provided at least 30 days in advance of the date of plan eligibility or 30 days in advance of the first investment in a QDIA. Additionally, all plan participants who are defaulted into a QDIA must be provided an annual notice at least 30 days in advance of each plan year. The QDIA notice may be combined with an automatic enrollment notice. However, the final regulations clarify that disclosure requirements may not be satisfied by including QDIA notice information in a summary of material modification or SPD.

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The QDIA notice must contain all of the following: The circumstances under which a participant’s account may be invested in a QDIA,

and, if the plan uses automatic enrollment, an explanation of the circumstances under which elective contributions will be made on behalf of the participant, the percentage of such contributions and the right of the participant to opt out or elect to contribute at a different rate

An explanation of the participant’s rights to direct the investment of assets in his or her accounts

A description of the QDIA fund, including the investment objectives, the risk and return characteristics, and the fees and expenses attributable to the QDIA

A description of the participant’s right to direct amounts invested in a QDIA to other investment alternatives offered under the plan, including a description of any applicable restrictions, fees, or expenses as related to the transfer

An explanation of where the participant can obtain additional information concerning the other investment alternatives offered under the plan

Plan sponsors are not required to comply with the QDIA final regulations. Indeed, if a plan requires participants to make affirmative investment elections upon enrollment, the QDIA regulations will not apply to those decisions. Moreover, even where a plan uses default investment funds, the regulations clearly provide that they are not the exclusive means by which a fiduciary may satisfy the ERISA fiduciary responsibilities with regard to a plan’s default fund. Failure to comply with the regulations means that the plan fiduciary is responsible for the default investment decision. Please contact T. Rowe Price or your RPAM for more information on QDIA and sample notices.

Distributions and Loans Distributions from a plan can occur for a variety of reasons. Some are the result of a participant terminating employment with the company sponsoring the plan. Others can occur while the participant is still employed. The adoption agreement, plan document, and SPD describe the types of distributions allowed by your plan. The plan administrator is responsible for completing the appropriate form for each type of distribution request. Completed forms should be submitted, by fax, to DST Retirement Solutions, LLC, via a secure fax number for processing. The plan administrator should maintain the original request with their plan records.

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General Rules Applicable to All Distributions Notice of Taxation of Distribution and Waiver of Notice Period The Internal Revenue Code contains complex rules relating to the taxation of amounts a participant receives from the plan. In general, distributions are either taxable or nontaxable. The taxability is determined by the type of money distributed, the reason for the distribution, and the participant’s age at the time of distribution. Participants are required by law to be notified in writing of the tax consequences of all distributions. Please refer to the Notice of Taxation of Distribution, available on CPSRC, for a detailed description concerning the taxation of distributions. Participants are required to certify that they have been given this notice. To encourage participants to make a more deliberate decision, participants are required by law to wait 30 days from the date they authorize a withdrawal request before the distribution can be processed. For participants who do not elect to waive this waiting period, the plan administrator should not submit the form to DST Retirement Solutions, LLC, for processing until the 30-day period has expired. DST Retirement Solutions, LLC, will process distribution requests on the day of receipt provided the form is completed in full and in good order and received by 4:00 p.m. eastern time. Vesting Vesting is the percentage of ownership a participant has in his or her account balance. Salary deferrals, after-tax employee contributions, and rollover contributions are always 100% vested. Match, profit sharing, and certain other employer contributions are subject to the vesting schedule elected in the plan’s adoption agreement. Certain types of employer contributions such as a qualified nonelective contribution are required to be 100% vested. DST Retirement Solutions, LLC, will assist the plan administrator in determining which money types are subject to vesting and the applicable vesting schedule. The plan administrator is ultimately responsible for calculating a participant’s vesting percentage. The plan administrator must certify a participant’s vested amount for each money type so that the correct amount of money is distributed to the participant. If an employee terminates employment before becoming 100% vested, the nonvested amount will transfer into the plan’s forfeiture account. The plan’s adoption agreement defines how forfeiture account assets may be used and the plan administrator is responsible for the administration of the forfeiture assets. Note: A participant who dies or becomes permanently and totally disabled while employed

at the company, may become 100% vested in the entire account balance as indicated in the adoption agreement. Also, a participant who satisfies the retirement requirements of a plan while employed at the company becomes 100% vested in the entire account balance as indicated in the plan’s adoption agreement.

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Spousal Consent—Qualified Joint and Survivor Annuity (QJSA) Rules Some plans are subject to QJSA rules. The plan administrator should check the plan documents to determine if the plan is subject to the QJSA rules. Additionally, if the plan accepts assets as a direct transfer of assets from a plan that is subject to QJSA, and does not separately account for those assets, the entire plan may become subject to the QJSA rules. If you are not sure if your plan is subject to the QJSA rules, please consult with legal counsel. Plans subject to QJSA are required by law to offer an annuity option as a form of distribution. Plans that are subject to QJSA rules are required by law to have the consent of a married participant’s spouse before processing most distributions. Special distribution forms are available for plans subject to QJSA. These forms explain in more detail the joint and survivor annuity option and have a place for the spouse to sign his or her name as well a place for a witness’s signature. The spouse’s signature must be witnessed either by a notary public or the plan administrator. Methods of Distribution A taxable distribution that is eligible to roll over to another retirement plan is subject to federal income tax withholding rules as defined by the Internal Revenue Service. Generally, 20% of the distribution must be withheld unless the distribution is a direct rollover to an eligible plan. To the extent provided in the adoption agreement, a participant may elect to have his or her vested account balance distributed in any of the following manners:

Lump-sum cash payment to the participant Lump-sum direct rollover to an eligible retirement plan or IRA Lump-sum divided between cash payment to the participant and a direct rollover Monthly, quarterly, or annual periodic installments to the participant Over a period certain (not to exceed the participant’s life expectancy or the joint life

expectancy of the participant and his or her beneficiary) to the participant Qualified Joint and Survivor Annuity (only in cases where the plan is subject to the

QJSA rules) If the participant elects an annuity, the plan administrator will instruct T. Rowe Price to remit payment to purchase an annuity from a designated insurance company. The plan administrator is responsible for submitting a completed annuity application with the distribution request. The terms of any annuity contract purchased and distributed by the plan administrator to a participant or spouse must comply with the requirements of the plan. Transaction Forms and Kits All transaction request forms and transaction kits can be downloaded from the CPSRC. Be sure to always download the current form as regulations frequently change and sometimes require a form change. Forms and kits have been developed consistent with the provisions of Boston Financial Data Services prototype document. Forms can be downloaded as individual forms, or a kit can be selected. Many transactions require multiple disclosures to be made to a participant and his or her spouse. A kit combines the transaction forms with appropriate disclosures. If you have questions about which form or kit should be used, please contact your RPAM for assistance. Distribution kits include a Distribution Request Form, Notice of Taxation of Distribution, and a Qualified Joint and Survivor Annuity Notice, only if the plan is subject to QJSA.

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Distributions as a Result of Separation From Service Upon a participant's termination or retirement from the employer, the plan administrator should provide him or her with the appropriate distribution kit. Participants should be instructed to complete the distribution form and to return it to the plan administrator. Upon receipt of the completed form, the plan administrator should verify the dates of hire and termination, calculate and certify to the participant’s vesting percentage for each type of employer contribution under the plan, and sign the form in the space provided. The plan administrator should fax the completed distribution form to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the participant or to the rollover institution. A Form 1099-R will be mailed to the participant by January 31 of the year following the year in which the distribution occurred. Note: There are two ways a terminated participant can request a rollover into a T. Rowe Price

IRA. If the plan allows for one-call rollovers, terminated participants can call Participant Services to request the distribution and rollover. Alternatively, the participant may complete the Open an IRA form which is available online through T. Rowe Price’s Web site, troweprice.com or on request. The IRA must be set up before the account balance can be rolled into it. Participants may return the rollover IRA application directly to T. Rowe Price and wait for the IRA to be set up before submitting their distribution forms, or they may attach the application to the distribution forms above and submit everything in one step to DST Retirement Solutions, LLC. If the IRA was previously established, the participant should include the account number on the distribution form.

Distributions as a Result of Total and Permanent Disability A participant may request a distribution from the plan if he or she becomes disabled. The plan administrator should provide the participant with the appropriate distribution kit. The plan administrator should also request a physician letter stating that the participant is totally and permanently disabled. See the plan document for the definition of totally and permanently disabled. Participants should be instructed to complete the distribution form and to return it to the plan administrator with a physician letter. Upon receipt of the completed form and letter, the plan administrator should verify the date of hire and date the participant became disabled. It is the responsibility of the plan administrator to determine if the participant meets the definition of disability as defined by the plan. Calculate and certify to the participant’s vesting percentage for each type of employer contribution under the plan, and sign the form in the space provided. If total disability occurs while a participant is employed, the participant’s account balance may be 100% vested as defined in the adoption agreement. The plan administrator should fax the completed distribution form to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price and DST Retirement Solutions, LLC, should not be sent the physician letter because that is strictly for the plan administrator’s records and review. T. Rowe Price will prepare the distribution check and forward it to the participant or to the rollover institution. A Form 1099-R will be mailed to the participant by January 31 of the year following the year in which the distribution occurred.

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Death Distributions If a participant dies, the participant’s primary beneficiary should be sent the appropriate distribution kit. If there is more than one primary beneficiary, each beneficiary should be sent a kit. The plan administrator can determine the primary beneficiaries by referring to the information on the most recent designation of beneficiary that was signed by the participant. If none of the primary beneficiaries are living, the kit(s) should be sent to the secondary beneficiaries. If no valid beneficiary designation is in effect at the time of the participant’s death, refer to the plan document for the priority order of beneficiary distributions. The beneficiary should be instructed to complete the form and return it to the plan administrator with a certified copy of the participant’s death certificate. Upon receipt of the completed form and death certificate, the plan administrator should verify the dates of hire and death, calculate and certify the participant’s vesting percentage, and sign the form in the space provided. Please note that if the participant died while still employed with the company, the account may become 100% vested as defined in the adoption agreement. The plan administrator should fax a copy of the distribution form and the death certificate to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the beneficiary. If the distribution is a direct rollover, a check will be mailed to the rollover institution. A Form 1099-R will be mailed to the beneficiary by January 31 following the year in which the distribution occurred. Involuntary (Forced) Distributions To the extent provided in the adoption agreement, Participants who are no longer employed by the company and who have a vested account balance (including loan balances, but excluding rollover balances) of less than $1,000, may have their accounts distributed without their consent. Forced distributions give plan administrators the opportunity to rid their plan of small, administratively expensive accounts. It also minimizes the risk of “lost” participants who move away and who cannot be located years later. The plan administrator must provide the participant with a notice of intent to distribute the participant’s account, an appropriate distribution kit, and a time frame for the participant to complete and return the distribution form. It is recommended, though not required, that the kit be sent by certified mail, receipt requested, so the plan administrator has proof of delivery. To the extent provided in the adoption agreement, plans may elect to distribute terminated participant balances between $1,000 and $5,000 directly into an IRA for the benefit of the participant. Please contact your RPAM to discuss automatic rollover requirements. The time frame indicated by the plan administrator should include a deadline for receipt of the completed form. A typical time frame is 60 to 90 days. If the form is not returned by the deadline, the plan administrator should initiate an involuntary distribution. The plan administrator should complete the distribution form, indicate that it is a lump-sum distribution, and write the words “involuntary distribution” on the participant signature line. The consent of the participant and/or his or her spouse is not required for a forced distribution even if the plan is subject to QJSA rules.

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The plan administrator should fax a copy of the distribution form to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the participant or to the IRA provider. A Form 1099-R will be mailed to the participant by January 31 following the year in which the distribution occurred. In-Service Withdrawals To the extent provided in the plan’s adoption agreement, there are some withdrawals that may be made from the plan while a participant is still employed with the company. For these types of withdrawals, the participant should be given the appropriate distribution kit. Participants should be instructed to complete the distribution form and to return it to the plan administrator. Upon receipt of the completed form, the plan administrator should verify the date of hire and distribution reason, calculate and certify the participant’s vesting percentage for each type of employer contribution under the plan, and sign the form in the space provided. The plan administrator should fax the completed distribution form to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the participant or to the rollover institution. A Form 1099-R will be mailed to the participant by January 31 following the year in which the distribution occurred. Post-Age 59½ Distributions To the extent provided in the plan’s adoption agreement, a participant is permitted to withdraw all, or portions of his or her vested account balance, on or after the attainment of age 59½. Please call your RPAM if you need assistance in determining the amount available. For these types of withdrawals, the participant should be given the appropriate distribution kit. Participants should be instructed to complete the distribution form and to return it to the plan administrator. Upon receipt of the completed form, the plan administrator should verify the date of hire and age of the participant, calculate and certify the participant’s vesting percentage for each type of employer contribution under the plan, and sign the form in the space provided. The plan administrator should fax the completed distribution form to DST Retirement Solutions, LLC for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the participant or to the rollover institution. A Form 1099-R will be mailed to the participant by January 31 following the year in which the distribution occurred. Withdrawals of After-Tax Accounts An active participant may request an in-service withdrawal of a portion of his or her after-tax contribution account, as defined in the plan document, at any time by submitting a written request to the plan administrator. Different tax rules apply to after-tax money contributed before 1/1/87 and after 12/31/86. These rules affect the amount of earnings that must be withdrawn when a distribution is taken. If your plan has both pre-1987 and post-1986 after-tax contributions, it is important to keep detailed records of amounts contributed and withdrawals taken as these tax rules are complex. For these types of withdrawals, the participant should be given the appropriate distribution kit.

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Participants should be instructed to complete the distribution form and to return it to the plan administrator. Upon receipt of the completed form, the plan administrator should verify the date of hire, calculate and certify to the participant’s vesting percentage for each type of employer contribution under the plan, if applicable, and sign the form in the space provided. The plan administrator should fax the completed distribution form to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the participant or to the rollover institution. A Form 1099-R will be mailed to the participant by January 31 following the year in which the distribution occurred. Withdrawals of Roth Accounts Since Roth contributions are made on an after-tax basis, their tax treatment when coming out of the plan is different from the tax treatment of a pretax account. If a Roth account distribution is considered “qualified,” no tax is due. If the distribution is considered not to be “qualified,” income tax generally will be due on the portion of the distribution attributable to earnings. To be considered “qualified,” a Roth distribution must be because of the participant’s death, disability or attainment of age 59½, and the distribution must be made five years or more after January 1 of the first year that the participant made a Roth contribution to the plan. Hardship Withdrawals If the plan’s adoption agreement provides for hardship withdrawals, a participant may withdraw a portion of his or her account balance as a financial hardship. The participant must have an immediate and heavy financial need and not have other resources to meet the need. Before taking a hardship, the participant is required to take all other available in-service withdrawals, including loans, available under this plan and any other plans maintained by the employer. The plan administrator may determine that a plan loan would cause a greater hardship and choose not to require a loan from the plan. There are two types of hardship withdrawals. They are safe harbor hardship withdrawals and facts and circumstance hardship withdrawals. Under the safe harbor hardship withdrawal rules; only the following circumstances qualify as an immediate and heavy financial need for hardship withdrawal purposes:

The need to prevent eviction from, or foreclosure on the mortgage of, the participant’s primary residence

Medical expenses incurred by the participant, his or her spouse, or other dependent that would qualify as deductible on an individual tax return

Payment of tuition and related educational fees and room and board expenses for the next year for post-secondary education for the participant, his or her spouse, or other dependents

The purchase of the participant’s primary residence Payments for burial or funeral expenses for the participant’s deceased parent,

spouse, children, or dependents Expenses for repairing damages to the participant’s principal residence that would

qualify for a casualty deduction under Internal Revenue Code Section 165. Under the facts and circumstances hardship withdrawal rules, the participant must provide evidence that he or she is in an immediate and heavy financial need for a hardship withdrawal. The participant’s purpose may fall outside of the purposes mentioned above for all accounts except the Elective Deferral accounts, as they would still fall under the safe harbor withdrawal rules.

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Determining the Amount of the Hardship Withdrawal The amount available for a hardship withdrawal includes salary deferral contributions and earnings before 1/1/89 and salary deferral contributions, but not earnings, after 12/31/88. Additional sources of money may be available as defined in the plan’s adoption agreement. A participant may only withdraw the amount needed to meet his or her financial need. The distribution may be grossed up to include taxes due on the distribution up to the maximum allowed for a hardship distribution. Participants should indicate a withholding election on the hardship distribution form. Ten percent will be withheld from the distribution if no election is made. Generally, withdrawals due to financial hardship are not eligible for roll over to another retirement plan. Processing the Hardship Distribution For these types of withdrawals, the participant should be given the appropriate distribution kit. Participants should be instructed to complete the distribution form and to return it to the plan administrator with documentation of the financial need. The documentation should include the reason for the financial hardship and the dollar amount needed. Upon receipt of the completed form, the plan administrator should verify the date of hire, verify the need for the hardship withdrawal, calculate and certify to the participant’s vesting percentage for each type of employer contribution under the plan, and sign the form in the space provided. The plan administrator should fax the completed distribution form to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the participant. A Form 1099-R will be mailed to the participant by January 31 following the year in which the distribution occurred. The plan administrator must notify the participant of the result of the review of the request. Any request for a financial hardship withdrawal that does not qualify under the terms of the plan document should be communicated to the participant in writing. The reason why the withdrawal does not qualify should be explained. Suspension and Reduction of Future Contributions The plan administrator must contact the payroll department or vendor to stop the participant’s elective deferrals to the plan. Participants who take a hardship distribution must be suspended from making elective deferrals for six months from the date of the distribution. Some plan adoption agreements require a different time period. Check your plan’s adoption agreement to determine the appropriate suspension period. Required Minimum Distributions (RMDs)—Age 70½ The IRS generally requires that participants begin taking distributions from their plan upon attainment of age 70½. Determining Who Is Required to Take a Minimum Distribution A participant who reaches age 70½ and is still working and is not a 5% owner of the company is not required to take an RMD until April 1 following the retirement year. Participants who are over age 70½ and are not working, or who are 5% owners and are still working, must begin taking RMDs by April 1 following the year in which they reach age 70½.

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For tax year 2009, the IRS made an exception to required minimum distributions as plan administrators may grant a waiver if they choose. There are two types of waivers. The plan administrator may choose to waive all required distributions for 2009, or they may choose to give participants the option to waive their 2009 RMD. If the plan administrator chooses to implement the waiver, they must contact their RPAM and provide written notification because their document will need to be amended. Distributions for subsequent years must be taken by December 31. Participants can be assessed significant tax penalties for failure to take minimum distributions. The tax penalty is 50% of the amount of the RMD that was not taken. RMDs must be taken in cash and may not be rolled over into an IRA or another qualified plan. Calculating the Amount of the RMD The basic formula for calculating the amount is to first determine the December 31 account balance of the previous year. Divide this amount by the participant’s life expectancy factor generally determined using the Uniform Lifetime Table published by the IRS. Participants are required to take the RMD from each 401(k) plan they maintain. Unlike IRAs, 401(k) plans may not be aggregated and the minimum taken from one plan. If a participant’s spouse is 10 or more years younger than the participant, the Joint Life and Last Survivor Expectancy Table published by the IRS is used to calculate their distribution amount. Participants can always elect to take more than the minimum, but not less. The failure of a participant to take their RMD results in a tax penalty of 50% of the required amount. DST Retirement Solutions, LLC, is available to assist the plan administrator in calculating the minimum amount. Processing RMDs Based on census data provided by the plan administrator, DST Retirement Solutions, LLC, will provide a report during the first month of the fourth quarter of each year indicating participants in the plan who have attained age 70½ during the year. The plan administrator should determine which of the listed participants must receive a minimum distribution. The plan administrator should provide the appropriate distribution kit to those participants. Participants should be instructed to complete the distribution form and to return it to the plan administrator. Upon receipt of the completed form, the plan administrator should verify the dates of hire and termination, if applicable; calculate and certify to the participant’s vesting percentage for each type of employer contribution under the plan; and sign the form in the space provided. The plan administrator should fax the completed distribution form to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the participant. A Form 1099-R will be mailed to the participant by January 31 following the year in which the distribution occurred.

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Qualified Domestic Relations Order (QDRO) The plan administrator may be asked to distribute funds pursuant to a domestic relations order (DRO). A DRO is an order issued by a state court. It is granted to parties of a divorce. The order explains the property settlement regarding the allocation of marital property upon the legal termination of a marriage. The order will direct the plan administrator to pay some or all of the participant's vested account balance to the former spouse of the participant or another alternate payee. Payment made to a non-spousal alternate payee is not eligible for rollover. Determining Whether a Domestic Relations Order Is Qualified Federal law requires that the plan administrator adopt a written procedure to qualify DROs. The plan administrator is responsible for, and should contact their legal counsel and/or refer to the DOL Web site: dol.gov/ebsa/publications/qdros.html, for assistance in determining if a DRO is "qualified" (a Qualified Domestic Relations Order or “QDRO” for short). The period of time during which a plan administrator determines whether a DRO is qualified is called the “determination period.” A plan administrator cannot take more than 18 months to determine if a DRO is qualified. The plan administrator may not permit distributions, during the determination period, to the participant or any other person of any amounts that would be payable to the alternate payee, if the DRO were determined to be a QDRO. Upon receipt of a DRO concerning a participant in the plan, the plan administrator should follow the plan’s written procedures to determine if all required elements of a QDRO are in good order. Note that the QDRO may provide that the designated amount is to be paid to the alternate payee immediately. Please contact legal counsel if you have questions regarding how to qualify a DRO. Processing a QDRO Distribution provisions among DROs can vary. In some cases, the alternate payee’s share of the participant’s account must be segregated in a separate account in the name of the alternate payee until the time when the account can be distributed according to the terms of the plan and the QDRO. In other cases, distribution to the alternate payee may be made immediately. The procedures for processing a QDRO distribution are very similar to the procedures for any in-service withdrawal. The plan administrator should provide the alternate payee with the appropriate distribution kit and information about investment elections if the recipient’s account balance will remain in the plan. Upon receipt of the completed form from the alternate payee, the plan administrator should verify the information, calculate and certify the participant’s vesting percentage, and sign the form in the space provided.

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When the awarded assets are less than 100% of the participant’s account, the plan administrator also submits a letter of instruction that includes instructions for the awarded assets:

• Instructions to distribute the assets pro rata from each mutual fund account or instructions that identify the mutual fund(s) the assets are to be distributed from

• When the assets to be transferred are invested in a brokerage account, the instructions must specify if cash or brokerage holdings are to be transferred:

o If cash is to be transferred, the brokerage holding(s) must be liquidated before the assets can be transferred

The participant may call brokerage to liquidate, or, The plan administrator may include liquidation instructions in the letter of

instructions o If brokerage holdings are to be transferred, the instructions must identify the

holding(s) and provide the number of shares, the valuation date, and whether earnings are to be included in the calculation

o The alternate payee would complete an application to establish a brokerage account

The plan administrator should fax the completed distribution form, the letter of instructions (If applicable), and a copy of the QDRO to DST Retirement Solutions, LLC, for processing. All original forms should be filed in the participant’s file. T. Rowe Price will prepare the distribution check and forward it to the alternate payee or to the rollover institution. A Form 1099-R will be mailed to the alternate payee by January 31 following the year in which the distribution occurred. If the account balance will remain in the plan, assets should be segregated in an account for the alternate payee. Indicate on the distribution form to “transfer money to alternate payee’s account, but do not distribute.” The alternate payee will be considered a beneficiary of the plan and must be allowed to make investment elections as would a participant. The alternate payee may conduct any investment transactions by contacting Participant Services. Participant Loans If the plan permits participant loans, participants may take loans (maximum of three or the amount designated in the plan’s adoption agreement) from their vested available account balance. Loans must adhere to the plan administrator's loan policies as well as federal and state laws. Establishing a Loan Program The plan administrator must first establish a loan program. This is usually done when the plan’s adoption agreement is executed. Loans can be added to a plan later by a plan amendment. If your plan currently does not allow for loans, but you wish to allow for them, contact your RPAM to add a loan program and amend the plan’s adoption agreement. The plan administrator must communicate the loan policy to participants. Loans are established at the prime interest rate, as set by State Street Bank, plus one (prime plus one). The new loan interest rate is updated monthly. Alternatively, the plan administrator may establish a loan interest rate. This rate must be commensurate with rates for similar types of loans in the participant's geographic area as described in the plan’s written loan program.

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Limitations on Loan Eligibility The plan administrator is responsible for determining who is eligible to take a loan from the plan. Participants should be instructed to check their statements, review their account online, or call Participant Services to determine if they have enough money in their account to take a loan. The maximum amount a participant may borrow is the lesser of $50,000 (reduced by the highest outstanding loan balance in the last 12 months minus the current outstanding loan balance) or 50% of the participant’s vested account balance. A participant who already has the maximum number of outstanding loans allowed by the plan will not be eligible to take another loan until one of the others is paid off. Paperless/Automated Loans The automated loan feature on the participant Web site allows participants to go online and process loans. Plan administrators will be expected to check Standardized Reporting on the CPSRC for amortization schedules. Please note that paperless loans are not available for the following:

• Plans subject to QJSA; • Plans with a money purchase pension source; • Loans taken to satisfy a hardship need; • Mortgage loans.

Loan Applications Paper loan applications are required for the following circumstances:

• Plans using the safe harbor loan provisions; • Plans subject to QJSA; • Loans taken to satisfy a hardship need; • Mortgage loans.

When a loan request is initiated by a paper loan application, the participant should return the completed loan application to the plan administrator. The plan administrator completes the balance of the application. Remember to indicate the dollar amount of any loan fees that will be charged to the participant’s account. This dollar amount is in your service agreement with T. Rowe Price.

A copy of the completed loan application should be faxed to DST Retirement Solutions, LLC for processing. The original should be maintained in the participant’s file. The loan check will be mailed directly to the plan administrator. Automated Loans If your plan is allowing for automated loans, participants will log in to rps.troweprice.com and initiate a loan. The loan check will be mailed directly to the participant and the promissory note will appear on the back of their check. The plan administrator will need to review the CPSRC to obtain any loan amortization schedules in order to adjust the payroll records. Disclosures The Promissory Note/Truth in Lending Disclosure is sent to the participant with the loan check. Acceptance of the loan check proceeds constitutes agreement with the terms and conditions of the Promissory Note/Truth in Lending Disclosure. The loan amortization schedule is provided to the plan via the CPSRC under Standardized Reporting. It is the responsibility of the plan administrator to review the reports for loan amortization schedules regularly.

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The plan administrator should submit a copy of the loan amortization schedule to its payroll department or vendor to ensure that loan repayments are properly deducted from the participant’s paycheck. Loan payments are to be made by participants in accordance with the terms of the promissory note. Partial payments are not allowed. Loan Payoff Participants who wish to pay off a loan should first be instructed to notify their payroll department and/or plan administrator to determine that all their payroll deductions have been posted to their plan account. The participant or plan administrator should call T. Rowe Price and request to have their loan “frozen.” Freezing a loan prevents interest from accruing for a specified period. T. Rowe Price must receive the payoff check by the time the freeze expires or additional interest will be owed on the loan. The representative will inform the participant of the number of days the freeze will be in effect. T. Rowe Price will accept a bank money order, cashier’s check, certified check, or company check and will not accept a personal check. Your payroll department should stop loan deductions once the loan is paid. The Plan Loan Status Report will reflect a paid status the day following the final payment posting date. It is the responsibility of the participant to notify the plan administrator that the loan is paid in full. Outstanding Loans and Distributions Participants with outstanding loans who want to take a final distribution have two options:

Pay off the loan balance before the distribution is processed using the procedure described above. This allows the participant to roll over more money to another retirement plan without paying taxes.

or Offset the outstanding loan at the time of the distribution. If this is done, the dollar

amount offset is treated as if it were a cash distribution. The participant will owe income taxes on the amount offset and, depending on their age and status, may be subject to a 10% premature withdrawal penalty.

Managing Ongoing Loans A Plan Loan Status Report is available on the CPSRC. The plan administrator should review this report prior to each payroll for the following:

New participant loans–-When a new loan is established, provide the amortization schedule to the participant and submit a copy of the loan amortization schedule to its payroll department or vendor to ensure that loan repayments are properly deducted from the participant’s paycheck.

Terminated participants with outstanding loan balances—If the participant does not intend to pay off the loan, the plan administrator should request that the loan be deemed. Loans in default, but not deemed or offset, may jeopardize the tax-qualified status of the plan.

Small outstanding loan balances--These should be reviewed to determine their cause. Please contact your RPAM if you have questions about a small outstanding loan balance.

Loan payments past due—It is the plan administrator’s responsibility to ensure that loan payments are being deducted from paychecks and timely deposited. If a participant has multiple loans, make sure that each loan shows timely payments.

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Compliance, Contribution Limits, and Nondiscrimination Tests Annual Compliance Questionnaire At the end of your plan year, DST Retirement Solutions, LLC, will provide the plan administrator with an Annual Compliance Questionnaire. This questionnaire is a data collection tool to assist in the completion of your plan’s nondiscrimination testing and Form 5500--Annual Return/Report of Employee Benefit Plan. Data must be returned to DST Retirement Solutions, LLC, within 30 calendar days after the end of the plan year. The package contains:

Contribution limits as described by the IRS for the following year. These limits are generally indexed for the cost of living.

Request for information to perform annual compliance testing on the plan. Data regarding all employees of your company are needed to complete the testing requirements defined by your plan documents and current regulations. A plan must demonstrate annually that it has not discriminated in favor of highly compensated employees.

Request for information to complete the annual Form 5500, applicable schedules, and the Summary Annual Report.

Compliance Services:

Nondiscrimination tests including ADP and ACP Coverage testing, if required by your plan Section 415 Test Top-Heavy Test Cross testing Completion of Form 5500 and related schedules Summary Annual Report Audit Package, if required for Form 5500

Administrative Reports

Employer Administrative Reports The CPSRC provides plan administrators with access to the following reports. These reports are available to you 24 hours a day. For instructions on running these reports see the CPSRC user manual. On-Demand Reports Trust Report: Displays a summary of participant financial activity during a

selected reporting period. Custom Reporting: Provides the plan administrator the ability to run census

reports and query information such as date of hire, date of birth, compensation, deferrals, etc. This report also downloads into a user-friendly Excel format.

Census Verification Report: Displays all census data transmitted throughout the year

needed for year-end testing.

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Automatic and/or On-Demand Reports Plan Eligibility Projection Report: The Plan Eligibility Projection Report provides information

on who will become eligible to participate in the defined contribution plan at a future date.

Contribution Cutoff Report: The Contribution Cutoff Report provides a list of plan participants who have generated a pending contribution change request and desired contribution values to be processed on the next contribution change date.

Auto Deferral Increase Report: The Auto Deferral Increase Report informs clients when a participant’s pretax contribution deferral percentage has been increased using the Auto Deferral Increase process.

Plan Loan Status: Displays participant loan data for all new and existing loans. Automated Loan Amortization Schedule: Displays participant loan amortization schedule

indicating the number of payments, interest rate, payment amount, and payment due dates.

Plan Forfeiture: Displays history and balances by money type in the plan’s forfeiture accounts during a selected reporting period.

Plan Forfeiture Affiliate Summary: Displays history and balances by money type in a plan's

forfeiture accounts during selected reporting period for plans that have multiple affiliates.

Contribution: Displays history of contributions broken down by money type

and investment vehicle reporting annual activity.

Separation Detail: Displays participants that separated from service who still

hold assets in the plan.

Excess Deferral: Displays projection of participants who will exceed deferral

limits based on current deferrals. Participant Vesting: Displays vesting status of each participant by money type. Distribution: Displays participant distribution activity during a selected

reporting period. Age 70 ½: Displays participants that have attained age 70½ with

distribution activity for the current and prior year. Participant Termination: Displays rehire and termination dates of applicable

participants during a selected reporting period. Roster Turnaround: Displays contribution activity during a specified reporting

period.

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Outstanding Distribution Checks: Displays participants who have taken distributions that have not cashed their checks and includes the check number, check date, and check amount.

Confirmation of Plan Contributions: Displays detail of contributions by money type and

investment vehicle for an individual payroll period. Participant Statements Participant statements are mailed directly to the participant’s address of record quarterly. Statements reflect a summary of activity during the period and market value of account on the last day of the quarter. Statements are also available through the participant Web site or by contacting a customer service representative. Glossary of Terms Alphabetical Listing of Terms 401(k) Plan: A type of defined contribution plan originating from Section 401(k) of the Internal Revenue Code. A plan is established by an employer enabling an employee to elect a portion of his or her salary to be deducted from his or her paycheck and contributed to the plan. Employers may also choose to make contributions to a participant's account. Actual Contribution Percentage (ACP) Test: This test is to determine if the group average of employer matching and/or employee after-tax contribution percentages of eligible highly compensated employees (HCEs) is within an allowable limit as determined by the group of the employer matching and/or employee after-tax contribution percentages of the non-highly compensated employees (NHCEs). The ACP average is determined for the NHCEs based on the testing method elected by the plan sponsor in the plan’s adoption agreement. The HCE ACP average is calculated and used to measure whether the HCE group has exceeded the allowable limit under the regulations. Actual Deferral Percentage (ADP) Test: This test compares the group average of employee deferral rates for the plan’s highly compensated employee (HCE) group with the corresponding averages for the non-highly compensated employee (NHCE) group. The ADP average is determined for the NHCEs based on the testing method elected by the plan sponsor (in your adoption agreement), and then the HCE ADP average is calculated and used to measure whether the HCE group has exceeded the allowable limit under the regulations. Adoption Agreement: The document used with a prototype plan document. This document specifies optional plan provisions. Annual Additions Limitation Test: This test is to check whether “annual additions” to a participant’s account for a plan year exceed the Internal Revenue Code Section 415 limitation. “Annual additions” include the sum of employer contributions, employee contributions, and reallocated forfeitures credited to a participant’s account for the plan year. This test is based on the data you provide at plan year-end. If participants exceed the Section 415 limits, corrective action may be required to maintain your plan’s qualified status. Annual Audit: ERISA plans with more than 100 participants may be required by federal law to be audited by an independent public accountant.

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Annual Report: The IRS and DOL require a document, Form 5500, to be filed annually. The form reports plan information for the year, including such items as participation, funding, and administration. Automatic Clearing House (ACH): The electronic transfer of money between participating financial institutions. Catch-Up Contributions: If elected by the employer in the plan’s adoption agreement, employees who are eligible to make elective deferral contributions and who have attained age 50 before the close of the tax year are eligible to defer an additional amount in excess of the dollar limit in the Internal Revenue Code or any limits stated in the plan. For the 2009 plan year, the maximum catch-up contribution is $5,500. For annual testing purposes, catch-up contributions do not need to be accounted for separately from elective deferrals. Compliance Tests: IRS-mandated tests that compare contributions and plan account balances for different classifications of plan participants. By making certain minimum contributions to employees, employers can automatically comply with these tests. Further detail is described within the explanation of each test. Contribution: A credit of money received by a plan account. Contributions made by an employer may be either a contribution to all eligible employees or a matching contribution to all participants. Participants elect their contributions through salary deferral. Deferral: Participants contribute to the plan by selecting amounts to be reduced from their salary before federal and, generally*, state income taxes. Income taxes are deferred on contributions and investment earnings until the participant receives a distribution from the plan. *(Refer to specific state tax laws.) Defined Contribution Plan: An employer-sponsored retirement plan that is qualified under IRS and DOL regulations to receive a tax-qualified status. The contributions may be made by the employer, the employee, or both, depending on how the plan is designed. Department of Labor (DOL): The DOL enforces laws related to the American workforce. The Employee Benefits Security Administration (EBSA) is the branch responsible for administering the provisions of Title I of ERISA. Depository Timing: The DOL requires that amounts paid by a participant or beneficiary to an employer and/or withheld by the employer for contribution to the plan are participant contributions that become plan assets of the earliest date on which such contribution can reasonably be segregated from the employer’s general assets. Diversification: The apportionment of one's securities among different companies or investment categories to minimize risk. Eligible Automatic Contribution Arrangement (EACA): An arrangement which allows the participant to elect to have the employer make contributions to the plan on his or her behalf in the absence of such an election. EACA allows for certain automatic contributions to the plan by the employer on behalf of the participant equal to a uniform percentage of compensation. An EACA is not required to provide a default investment meeting the requirements of ERISA Section 404(c)(5) to offer a 90-day permissible withdrawal feature. EACA requires specific information in a notice to participants.

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Eligibility: Conditions that must be met in order to participate in a plan, such as age or service requirements. ERISA specifies a maximum threshold of one year of service and 21 years of age. Employee Benefits Security Administration (EBSA)): The division of the Department of Labor that enforces ERISA regulations for employee benefit plans. Enrollment: The process where an eligible employee establishes their initial plan elections: salary deferral amount, investment allocations, and beneficiary designation. ERISA: Employee Retirement Income Security Act of 1974. ERISA established rules that govern how employers create and manage certain types of benefit programs. Family Attribution: An individual considered as owning the stock of his spouse (other than a spouse who is legally separated), children, grandchildren, and parents. A legally adopted child is treated as a child of the individual. If more than 5% of the value of the stock in a corporation is owned directly or indirectly by an individual, that individual will be considered as owning the same percentage of stock owned by the corporation. Example1: The parent of a more than 5% owner is considered a more than 5% owner through the constructive ownership attribution rule. Example 2: A father and daughter each independently own 3% of the value of the stock of a company sponsoring the plan. Both are treated as owning 6% and are considered key employees. Fidelity Bond: Under ERISA Section 412, every fiduciary and every person who handles plan funds must be bonded. The bond must provide protection to the funds of the plan(s) involved against loss by reason of act of fraud or dishonesty. The amount of the bond must be fixed at the beginning of each plan year and in the amount not less than 10% of the trust assets. The bond may not be less than $1,000 and need not be greater than $1,000,000 even if 10% of the trust assets would otherwise require a larger dollar amount. The bond is required for all qualified plans except for plans that the only participant is sole owner of a business that maintains the plan, or partners in a partnership that maintains a plan, and any spouse. Plans that are 100% invested in insurance products are exempt from this requirement. The bonding requirement is separate from any fiduciary insurance that might be purchased by the plan, the employer, or the fiduciaries themselves. Fiduciary: Under ERISA, generally any person who exercises any discretionary authority or control over the management of a plan or the management of disposition of its assets. Fiduciaries act solely in the interest of the participants and the beneficiaries of an employee benefit plan. In addition, a fiduciary must act exclusively for the purpose of providing benefits to participants and beneficiaries and in defraying reasonable expenses of the plan. Forfeitures: Any part of benefits that a participant loses if he or she is not 100% vested upon termination of employment. Forfeitures relate only to employer contributions. Pretax, after-tax and rollover contributions that the employee makes are 100% vested at all times. Form 1099-R: An IRS form for reporting any distribution made to a plan participant, beneficiary, or alternate payee. Form 5500: A joint agency form developed by the IRS, DOL, and PBGC that is used to satisfy the annual reporting requirements of the IRC and ERISA.

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Hardship Withdrawal: An in-service withdrawal from a 401(k) due to an immediate financial need of a participant that cannot be satisfied from other resources. Highly Compensated Employee (HCE): (This determination is used in the ADP/ACP test.) An HCE is any eligible employee who:

Owned more than 5% of any company sponsoring the plan at any time during the plan year and/or the preceding plan year, regardless of compensation.

Earned more than amount indicated by the IRS in gross compensation during the 12 months preceding this plan year.

Is a family-member employee of an owner, and the individual aggregate ownership of the family member exceeds 5% of the company (parents, a spouse, a child, or grandchild).

The definition of an HCE is not based on the participant’s compensation for the plan year being tested. It is based on the participant’s compensation during the 12 months proceeding the plan year being tested. Report the actual compensation the participant received. See also “Special Election for Fiscal Year Plans.” Internal Revenue Code (IRC): Federal Tax Law. Internal Revenue Service (IRS): This branch of the U.S. Treasury Department is responsible for administering federal tax laws. Qualified pension plans and other retirement plans also fall under their jurisdiction. Key Employee: (This determination is used in the top-heavy test.) A key employee is any employee who at any time of the plan year:

Owned more than 5% of any company sponsoring the Plan. Owned more than 1% of any company sponsoring the Plan and had gross annual

compensation greater than $150,000. An Officer of the company with gross annual compensation greater than $130,000. See “Family Attribution” rules.

Mutual Fund: A portfolio of stock, bonds, and/or cash equivalents, which is typically actively managed. Open-ended mutual funds are typically actively managed; the portfolio manager buys and sells securities in an attempt to take advantage of current or expected market conditions. An investment company that pools together funds from individuals and invests those funds into specific securities designed to meet the specific objective of the funds. Non-Highly Compensated Employees (NHCE): Eligible employees who do not meet the definition of a highly compensated employee. Participant: An employee who meets the plan’s eligibility requirements and/or has a balance in the plan. Participant Loans: A 401(k) plan may allow participant loans. In these plans, the IRS allows employees to borrow one-half of their vested account balance up to $50,000 (reduced by the highest outstanding loan balance in the previous 12 months). Loan repayments are made through payroll deductions, with the participant choosing the amortization period (a maximum of five years is allowed except for purchase of a home).

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Party-In-Interest: Refers to certain parties who have a close relationship to the plan (e.g., as a fiduciary, provider of services, or the plan sponsor) and, as a consequence, are prohibited from engaging in certain transactions with the plan in the absence of a statutory or administrative exemption. Pension Protection Act of 2006 (PPA): Legislation intended to strengthen employee’s retirement security, the PPA provided statutory support for automatic enrollment in 401(k) plans and making permanent the multiple enhancements of the Economic Growth and Tax Relief Act (EGTRRA). Plan Administrator: The person that operates the plan according to its terms and the Employee Retirement Income Security Act of 1974 (ERISA). This person is a fiduciary of the plan and is charged with operating the plan for the sole benefit of participants. Plan Assets: The total of all account balances of a plan including employee and employer contributions, outstanding loans, and balances in forfeiture accounts. Plan Document: The document that states the provisions of the plan. Plan Participation Rate: The percentage ratio of eligible employees who are enrolled in the plan over all eligible employees. Plan Sponsor: The employer that establishes, maintains, and contributes to the plan. Plan Year: The year so defined by the plan. Pretax Contribution: Participant-elected payroll deferrals are included in Social Security Taxes (FICA and FUTA) and excluded from federal and generally* state income taxes. *(Refer to specific state tax laws.) Prohibited Transaction: Nonexempt transactions, or prohibited transactions, are specific transactions that may not be entered into by a party-in-interest with the plan. Those include sales or exchanges, leases, and loans between the parties. If the plan has been involved in any nonexempt transactions with the parties-in-interest (i.e., prohibited transactions), IRS Form 5330, Return of Excise Taxes Related to Employee Benefit Plans, must be filed and the excise tax on the prohibited transaction paid. Prospectus: A document for investors that describes a particular mutual fund and its overall investment goals. Prototype Plan: A qualified retirement plan that has been approved and qualified as to its form by the IRS. Qualified Automatic Contribution Arrangement (QACA): A safe harbor automatic enrollment program created by the PPA of 2006. Available for plan years beginning on or after January 1, 2008, this type of safe harbor plan provides for a matching or nonelective contribution that is less expensive than a 401(k) safe harbor plan’s matching contribution.

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Qualified Default Investment Alternative (QDIA): Regulations issued On October 24, 2007 by the U.S. Department of Labor (DOL), QDIA extends Employee Retirement Income Security Act (ERISA) Section 404(c) fiduciary relief for decisions to invest plan assets in default investment funds as long as those funds meet QDIA requirements. A fiduciary will be afforded ERISA Section 404(c) relief for QDIAs, provided that the fiduciary prudently selects the QDIA fund and meets certain conditions. Qualified Domestic Relation Order (QDRO): A court order under a state's domestic relations law that creates or recognizes an alternate payee's (such as former spouse, child, etc.) right to receive all or a portion of a participant's retirement plan benefits if the plan administrator approves the order as a QDRO. Qualified Matching Contribution (QMAC): An employer matching contribution made to participants as defined in the plan’s adoption agreement. A QMAC is sometimes used as a means to correct a failed ACP test. Certain restrictions and rules apply to the use of a QMAC. Qualified Nonelective Contribution (QNEC): An additional contribution made by the employer on behalf of eligible employees as defined in the plan’s adoption agreement. A QNEC is sometimes used as a means to correct a failed ADP test. Certain restrictions and rules apply to the use of a QNEC. Qualified Plan: A plan that meets the requirements of Section 401(a) of the Internal Revenue Code and as such receives the federal income tax treatment provided by IRC Section 401, 402 and 501. A 401(k) plan is considered a Qualified Plan. Retirement Date Fund (RDF) Target date investment funds, T Rowe RDFs provide professionally managed investment portfolios that rebalance the underlying investment allocations to a more conservative mix as the funds near their expected target dates. Rollover: A transfer (rollover) from one retirement plan or IRA into another using a method where the money is not subject to early withdrawal penalties or income taxation. Roth Contribution: An elective contribution that is made on an after-tax rather than before-tax basis and meets certain other requirements. Self-Directed Account: Any investment option in a plan that provides participant-directed investment is "self-directed." Generally a plan offers several investment vehicles and allows participants to direct investment of account balances amongst those vehicles. Service Provider: A company that provides a service to the plan or plan administrator. DST Retirement Solutions, LLC as third-party recordkeeper is a service provider to your plan. Special Election for Fiscal Year Plans: If your plan year end is other than 12/31 (i.e., a fiscal year plan), you may elect to use compensation for the calendar year to determine those who earned over the IRS-indicated amount to determine which participants are considered HCEs. If elected, the applicable period is the calendar year that ends with or within the current Plan Year. The applicable periods to determine more than 5% owners are the current plan year and the preceding 12 months.

If this election is chosen in the plan’s adoption agreement, you will not be able to determine your highly compensated employees at the beginning of the plan year.

If this election is chosen, it will apply to all future plan years.

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Summary Plan Description (SPD): A document required by ERISA that describes the features of an employer-sponsored plan. The primary purpose of the SPD is to disclose the features of the plan to current and potential plan participants. ERISA requires that certain information in layman's terms be contained in the SPD, including participant rights under ERISA, claims procedures, and funding arrangements. Top-Heavy Plan: A plan in which 60% of account balances (both vested and nonvested) are held by key employees. Top-Heavy Test: This test is to determine whether the total of the account balances of the key employees exceeds 60% of the total account balances of all participants as of the last day of the prior plan year. This date is known as the determination date. The balances are determined after adding back in-service withdrawals, which occurred in the five-year period ending on the determination date. Any distributions due to a separation of service, death, or disability during the one-year period ending on the determination date are added back as well. If the total account balance of the key employees exceeds 60%, the plan is top-heavy. If the plan is top-heavy, the plan sponsor may be required to make a minimum contribution to non-key employees and implement an accelerated vesting schedule for the next plan year. The top-heavy test does not apply to 401(k) safe harbor plans that meet both ADP/ACP percentages and do not include any contributions other than those necessary to meet those requirements. True-Up Calculation: If the plan document indicates match contribution is based on annual compensation, but the plan submits those contributions on a more frequent basis, a year-end adjustment may be needed to ensure that participants receive the full match. Valuation: A determination of the value of an investment or investment portfolio. Mutual funds are valued every business day. Plans that are record-kept by DST Retirement Solutions, LLC are valued on each day that the stock markets are open for business. This is known as daily valuation. Vesting: The mathematical schedule selected on the adoption agreement by the plan sponsor for allocating the ownership of the employer contributions deposited in eligible employee's accounts. Vesting schedules are based on years of service with an employer. Employees are always 100% vested in their own contributions.