PRINCESS CRUISES CHIEF EXECUTIVE OFFICER SUPPLEMENTAL RETIREMENT PLAN

A.

Effective as of November 1, 1998 (the “Effective Date”), Princess Cruises, Inc. (the “Former Sponsor”) established the “Princess Cruises, Inc. President’s Retirement Plan” (the “Plan”), for the Participant (as defined in Section 2.21 below), who was then the President of Former Sponsor. The name of the Plan was changed to the “Princess Cruises, Inc. Special Senior Executive Supplemental Retirement Plan,” and was changed again to the “Princess Cruises Special Senior Executive Supplemental Retirement Plan.” Effective as of April 5, 2006, the name of the Plan changed to the “Princess Cruises Chief Executive Officer Supplemental Retirement Plan.”

B.

In connection with the sale of substantially all of Former Sponsor’s assets to Princess Cruise Lines, Ltd., a corporation organized under the laws of Bermuda (“PCLL”), PCLL adopted and assumed sponsorship of the Plan and all of Former Sponsor’s rights, liabilities and obligations under and with respect to the Plan (except as otherwise set forth in the Asset Purchase Agreement).

C.

Before October 16, 2000, the Participant was a member in the P&O Pension Scheme. At that date a new scheme was established by P&O Princess Cruises plc and the Participant’s benefit under the P&O Pension Scheme was transferred to the new scheme. Effective as of October 16, 2000 the Participant became a member in the new scheme, which is called the “P&O Princess Cruises Pension Scheme.” The scheme, as modified by certain agreements dated January 16, 2001 and October 17, 2001, is herein referred to as the “UK Pension Scheme”.

D.

With effect on and from April 5, 2006 (the “Opt Out Date”), the Participant elected to opt out of the UK Pension Scheme. As a member of the UK Pension Scheme whose active membership has ceased, the Participant is entitled to a deferred pension. However, future accruals under the scheme ceased as of the Opt Out Date.

E.

Pursuant to Section 6.3 of the Participant’s Employment Agreement (as defined in Section 2.15, generally effective as of the Opt Out Date, the Plan was amended and completely restated (the “2006 Restatement”) . The primary purpose of the 2006 Restatement was to maintain the benefit structure provided to the Participant before the Opt Out Date. Accordingly, under the the Plan, as restated, the Participant is entitled to receive substantially the same benefits he was entitled to under this Plan and the UK Pension Scheme, both as in effect immediately before the Opt Out Date.

F.

The Plan is being amended and fully restated again to streamline the administration of the Plan, to conform the Plan to changes being made concurrently to the Trust from which Plan benefits are paid, and to comply with the final regulations under Code Section 409A. Such restatement shall be referred to herein as the “2008 Restatement.”

1.1

Purpose . The purpose of the Plan is to enable the Sponsor to attract, retain and motivate the Participant by providing to such executive certain retirement income as more fully set forth herein.

1.2

Effective Date and Term . The effective date of the Plan is November 1, 1998 (the “Effective Date”), provided, however, that the effective date of this 2008 Restatement is the Restatement Effective Date The Plan shall continue in effect until terminated by the Committee pursuant to the provisions of Section 7.5.

1.3

Participation . Participation in this Plan is open only to Peter G. Ratcliffe. The participation in this Plan and the payment of any benefits under this Plan shall be governed by the terms of this Plan. Participant shall execute a copy of this Plan evidencing his acceptance of the terms and conditions hereof and his participation in the Plan.

1.4

Applicability of ERISA . This Plan is intended to be a “top-hat” plan – that is, an unfunded plan maintained primarily for the purpose of providing deferred compensation to a select group of management or highly compensated employees within the meaning of ERISA.

2.1

Reserved .

2.2

Active Participant . “Active Participant” means the Participant so long as he has not Separated from Service and the Committee has not elected to terminate his Active Participation pursuant to Section 4.6. “Active Participation” means participation as an Active Participant. Active Participation will cease on the earlier of the Participant’s Separation from Service or the date the Committee terminates the Participant’s Active Participation under Section 4.6.

2.3

Adjustment Date . “Adjustment Date” means the date upon which Pension increases shall be effective under Section 3.3, which shall be April 1.

2.4

Affiliated Company . “Affiliated Company” means any entity that constitutes the Employer other than the Sponsor.

2.5

Alternate Payee . “Alternate Payee” means the Participant’s spouse or former spouse.

2.6

Average Annual Compensation . “Average Annual Compensation” means, with respect to the Participant and as of any date of reference (the “Determination Date”), the quotient obtained by dividing (a) the highest aggregate amount of Pensionable Earnings earned by such Participant during any consecutive 60-month period prior to (or ending on) such Determination Date, by (b) a factor of five.

2.7

Beneficiary . “Beneficiary” means the Surviving Spouse, who shall be entitled to receive the lump sum death benefit pursuant to Section 5.2(b), but if there is no Surviving Spouse at the Participant’s death or the Surviving Spouse dies within the five-year period following the Participant’s Separation from Service, such person or persons or entity or entities designated or deemed designated pursuant to Section 3.9 to receive the lump sum death benefit under Section 5.2.

2.8

Benefit Entitlement Statement . “Benefit Entitlement Statement” means the statement of a Participant’s benefit entitlement referenced in Section 3.10 of the Plan.

2.9

Change in Control .

(a)

“Change in Control” means the following and shall be deemed to occur if any of the following events occurs:

(i)

Any “person,” as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), other than an entity created by Carnival as part of a reorganization of the structure of the Carnival Corporation and plc Group (“Carnival Created Holding Company”) is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of Carnival representing more than 50% of the combined voting power of Carnival’s then outstanding voting securities.

(ii)

Any “person,” as such term is used in Sections 13(d) and 14(d) of the Exchange Act, other than Carnival or a direct or indirect subsidiary of Carnival (“Carnival Subsidiary”) is or becomes the “beneficial owner” (as defined in Rule13d-3 under the Exchange Act), directly or indirectly, of securities of Sponsor representing more than 50% of the combined voting power of Sponsor’s then outstanding voting securities.

(iii)

The stockholders of Carnival approve a merger or consolidation of Carnival with any other corporation, other than the following:

(A)

A merger or consolidation which would result in the voting securities of Carnival outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities or another entity) 50% or more of the combined voting power of the voting securities of Carnival or such other entity outstanding immediately after such merger or consolidation; or

(B)

A merger or consolidation effected to implement a recapitalization or reorganization of Carnival (or similar transaction) in which no person acquires more than 50% of the combined voting power of Carnival’s then outstanding voting securities; or

(C)

A merger or consolidation with a Carnival Created Holding Company.

(iv)

The stockholders of Sponsor approve a merger or consolidation of Sponsor with any other corporation, other than the following:

(A)

A merger or consolidation which would result in the voting securities of Sponsor outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities or another entity) 50% or more of the combined voting power of the voting securities of Sponsor or such other entity outstanding immediately after such merger or consolidation; or

(B)

A merger or consolidation effected to implement a recapitalization or reorganization of Sponsor (or similar transaction) in which no person acquires more than 50% of the combined voting power of Sponsor’s then outstanding voting securities; or

(C)

A merger or consolidation with a Carnival Subsidiary or Carnival Created Holding Company.

(v)

The stockholders of Carnival approve (i) a plan of complete liquidation of Carnival or (ii) an agreement for the sale or other disposition by the Carnival of all or substantially all of the Carnival’s assets to an entity other than one created by Carnival as part of a reorganization of the structure of the Carnival Corporation and plc Group.

(vi)

The stockholders of Sponsor approve a plan of complete liquidation of Sponsor or an agreement for the sale or other disposition by Sponsor of all or substantially all of Sponsor’s assets to a person that is not a Carnival Subsidiary.

(b)

Notwithstanding the preceding provisions of this Section 2.9, a Change in Control shall not be deemed to have occurred (A) if the “person” described in the preceding provisions of this Section 2.9 is an underwriter or underwriting syndicate that has acquired the ownership of 50% or more of the combined voting power of Carnival’s then outstanding voting securities solely in connection with a public offering of Carnival’s securities, or (B) if the “person” described in the preceding provisions of this Section 2.9 is an underwriter or underwriting syndicate that has acquired the ownership of 50% or more of the combined voting power of Sponsor’s then outstanding voting securities solely in connection with a public offering of Sponsor’s securities.

(c)

Wherever in the Plan there is reference of “Carnival”, this shall mean both Carnival Corporation, a corporation organized under the laws of the Republic of Panama, and Carnival plc, a company incorporated under the laws of England and Wales, and reference to Carnival’s outstanding voting securities shall be a reference to the combined voting power on joint electorate actions of the outstanding voting securities of both Carnival Corporation and Carnival plc.

2.10

Code . “Code” means the Internal Revenue Code of 1986, as amended.

2.11

Committee . “Committee” means the committee established to administer this Plan as set forth in Section 3.1 hereof, which shall be comprised of at least two persons, other than the Participant, who are appointed by the Board of Directors of the Sponsor.

2.12

Designated Participant . “Designated Participant” shall have the meaning given such term in the Trust Agreement.

2.13

Effective Date . “Effective Date” means the original effective date of the Plan, which is November 1, 1998.

2.14

Employer . “Employer” means Carnival plc, a company incorporated in England and Wales, Carnival Corporation, a corporation organized under the laws of the Republic of Panama, and any other employers whose employees are treated as employed by the same employer with Carnival plc or Carnival Corporation pursuant to Code Section 414(b) and (c).

2.15

Employment Agreement . “Employment Agreement” means the agreement by and between P&O Princess Cruises International, Ltd. and the Participant dated April 17, 2003, as amended July 19, 2004.

2.16

ERISA . “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

2.17

Fiduciary . “Fiduciary” shall have the meaning given such term in the Trust Agreement.

2.18

Final Pensionable Earnings . “Final Pensionable Earnings” means the higher of

(a)

the Pensionable Earnings received by the Participant in the twelve months ending on the last day of his Active Participation; and

(b)

the annual average of Pensionable Earnings over the period of three consecutive Tax Years which gives the highest result out of the 13 years ending on the last day of the Participant’s Active Participation. For this purpose, a Tax Year means a year ending April 5.

2.19

Former Sponsor . “Former Sponsor” means Princess Cruises, Inc., a former Sponsor of the Plan.

2.20

Normal Retirement Date . “Normal Retirement Date” means the date on which the Participant attains age 60.

2.21

Participant . “Participant” means Peter G. Ratcliffe, who was President of Former Sponsor on the Effective Date, and who is the Chief Executive Officer of P&O Princess Cruises International on the Restatement Effective Date.

2.22

Payment Date . “Payment Date” means the date upon which monthly installments of a Pension payable under the Plan shall be made, which shall be the first day of each calendar month.

2.23

PCLL . “PCLL” means Princess Cruises Lines, Ltd., a corporation organized under the laws of Bermuda.

2.24

Pension . “Pension” means a pension payable under this Plan, as further defined in Section 3.4.

2.25

Pensionable Earnings . “Pensionable Earnings” means, in relation to the Participant, basic pay from the Employer that is payable during Active Participation (a) including (i) any sums paid by Employer to the Participant as director’s fees or their equivalent, (ii) any amounts not currently includible in such Participant’s gross income by reason of Code Section 402(e)(3) and/or Code Section 125, and (iii) any portion of base salary deferred pursuant to the Princess Cruises Deferred Compensation Plan, provided that benefit payments under the Deferred Compensation Plan shall not be included in Pensionable Earnings, and (b) excluding any fixed allowances, overtime, bonus, commission or other fluctuating emoluments which are not pensionable under the terms of the Participant’s employment including, without limitation, the Participant’s car allowance payable under Section 5.4 of his Employment Agreement and his recreational and/or health club membership fees under Section 5.5 of his Employment Agreement.

2.26

Pensionable Service . “Pensionable Service” means, in relation to the Participant, 35 years and 57 days as of March 31, 2006 plus any additional Service credited after such date and before the Participant ceases Active Participation.

2.27

Plan . “Plan” means this Princess Cruises Chief Executive Officer Supplemental Retirement Plan adopted as of the Effective Date and as it has been and may be amended from time to time.

2.28

Potential Pensionable Service . “Potential Pensionable Service” means the Pensionable Service that the Participant would have had if he had continued as an Active Participant up to Normal Retirement Date.

2.29

Recordkeeper . “Recordkeeper” shall have the meaning given such term in the Trust Agreement.

2.30

Redetermination Date . “Redetermination Date” means the date as of which Pension increases under Section 3.3 and offset redeterminations under Section 3.4(c) shall be made, which shall be September 30.

2.31

Restatement Effective Date . “Restatement Effective Date” means the effective date of this 2008 Restatement, which shall be April 5, 2006, provided, however, the effective date of Section 7.14 and the amendments set forth in Exhibit B, which are designed to bring the Plan into compliance with Code Section 409A, shall be January 1, 2005.

2.32

Separation from Service . “Separation from Service” means a separation from service with the Employer, as such term is used in Code Section 409A(a)(2)(A(i), and as defined in applicable regulations thereunder. To “Separate from Service” means to experience a Separation from Service. In general, the Participant will have a Separation from Service with the Employer if he dies, retires or otherwise has a termination of employment with the Employer. Whether a termination of employment has occurred with respect to the Participant shall be based upon the facts and circumstances as determined by the Committee in accordance with applicable regulations. Notwithstanding the general definition of “Employer” as set forth in Section 2.14, for purposes of determining a “Separation from Service,” in applying Code Section 1563(a)(1), (c) and (3) for purposes of determining a controlled group of corporations under Code Section 414(b), the language “at least 20 percent” is used instead of “at least 80 percent” each place it appears in Section 1563(a)(1), (2) and (3), and in applying Treasury Regulations Section 1.414(c)-2 for purposes of determining trades or businesses (whether or not incorporated) that are under common control for purposes of Code Section 414(c), “at least 20 percent” is used instead of “at least 80 percent” each place it appears in Section 1.414(c)-2.

2.33

Service . “Service” means employment with the Employer.

2.34

Specified Rate . “Specified Rate” means the annual interest rate (as such rate may change from time to time) that is the most recent five year average of Moody’s AA 30-year Corporate Bond Index.

2.35

Sponsor . “Sponsor” means Princess Cruises Lines, Ltd., a company organized under the laws of Bermuda.

2.36

Spouse . “Spouse” means, with respect to the Participant, only that person (if any) to whom such Participant is married as of such Participant’s Separation from Service, provided, however, that a person who has been married to the Participant for less than one year as of such Participant’s Separation from Service shall not be deemed to be the “Spouse” of such Participant.

2.37

Surviving Spouse . “Surviving Spouse” means the Participant’s Spouse at the time of his death, if the Participant has a Spouse at the time of his death.

2.38

Total Incapacity . “Total Incapacity” means in relation to a Participant, a physical or mental condition which in the opinion of the Employer is likely permanently to prevent the Participant from doing his or her job with the Employer and from doing a suitable job with any other employer. “Suitable job” means a job which it is reasonable to expect the Participant to take (on the assumption that such jobs are available) and which allows the Participant to maintain his or her basic standard of living.

2.39

Trust . “Trust” means the trust from which certain benefits are payable under the Plan in accordance with the applicable provisions of the Trust Agreement.

2.40

Trust Agreement . “Trust Agreement” means the agreement pursuant to which the Trust is established, as it shall be amended from time to time.

2.41

Trustee . “Trustee” means the initial trustee of the Trust and any successor or individual or entity acting as a trustee of the Trust.

2.42

UK Pension Scheme . “UK Pension Scheme” means the P&O Princess Cruises Pension Scheme effective as of October 16, 2000, as modified by the agreements dated January 16, 2001 and October 17, 2001, all as in effect on April 5, 2006. Any amendments or other changes made to the UK Pension Scheme after April 5, 2006 shall not be taken into account for purposes of this Plan.

2.43

Undisputed Benefit Entitlement Statement . “Undisputed Benefit Entitlement Statement” means (a) any Benefit Entitlement Statement which is not initially disputed by the Participant (or Beneficiary) in the manner and within the time period specified in Section 3.10(c), and (b) any Benefit Entitlement Statement reissued by the Committee pursuant to Section 3.10(c) and with respect to which the Participant (or Beneficiary) does not file a statement of objection in the manner and within the time period specified in Section 3.10(d).

3.1

Committee Authority: Rules and Regulations . The Committee shall administer the Plan. The Committee shall have discretionary authority to (a) make, amend, interpret and enforce all appropriate rules and regulations for the administration of the Plan, and (b) decide or resolve, in its discretion, any and all questions, including interpretations of the Plan, as may arise in connection with the Plan. The Committee shall have authority to take or approve, in its discretion, all such actions relating to the Plan (including, without limitation, actions described in the preceding sentence). Any decision or action of the Committee (and, subject to the provisions of Section 3.6 hereof, any decision or action of the Committee) in respect of any question arising out of or in connection with the administration, interpretation and application of this Plan and the rules and regulations promulgated hereunder shall be final, conclusive and binding upon the Participant.

3.2

Appointment of Agents . In the administration of this Plan, the Committee may from time to time employ agents (which may include officers and/or employees of the Sponsor) and delegate to them such administrative duties as the Committee (as applicable) deems appropriate.

3.3

Pension Increases .

(a)

A Pension will be increased in payment under this Section 3.3. Increases will be effective once every calendar year on April 1 (the “Adjustment Date”).

(b)

Subject to (c) below, the rate of the increase for that part of a Pension that is attributable to Pensionable Service before April 6, 1997 will be 3%, or if less the percentage increase in the Consumer Price Index – Urban Wage Earners and Clerical Workers (“CPI-W”) over the twelve-month period ending on the Redetermination Date immediately preceding the Adjustment Date. The rate increase for that part of a Pension that is attributable to Pensionable Service on or after April 6, 1997 will be 5%, or if less, the percentage increase in the CPI-W over the twelve-month period ending on the Redetermination Date immediately preceding the Adjustment Date. In the event there is a decrease in the CPI-W for any year, the percentage increase in the amount of the Pension for that year shall be zero, and the percentage increase in the CPI-W for any subsequent year shall be calculated taking into account such prior year decrease in the CPI-W.

(c)

The rate of increase under this Section 3.3 for a retirement Pension under Article IV, which has been in payment for less than nine months at the Adjustment Date will be a percentage of the rate that would have been paid if it had been in payment for a full year, depending on how long the Pension has been in payment as set out below:

3.4

Calculation and Payment of Benefits .

(a)

Pensions Payable for Life . Unless the contrary is expressly stated, a Pension is payable for life and its amount as described in Article IV and V is its annual amount.

(b)

Payment of Pensions/Lump Sums .

(i)

All Pensions payable under the Plan will be paid in United States Dollars by monthly installments in arrear on the Payment Date. Except as provided by (ii) below, the first installment will fall due on the Payment Date next following the date on which the Pension was due to commence (that is, upon Separation from Service or the Participant’s death) and will be apportioned to take into account part of a month. The last installment will fall due on the Payment Date next following the date on which the event giving rise to the cessation of such Pension occurs and will not be apportioned to the date of such event.

(ii)

Where a Pension commences as a result of the death of the Participant if he is in receipt of a Pension under the Plan, the first installment of such Pension will fall due on the second Payment Date following the Participant’s death and will not be apportioned.

(iii)

Where a lump sum is payable as a result of the death of the Participant under Section 5.1 or Section 5.2(b) or as a result of the Surviving Spouse’s death under Section 5.2(c), such lump sum shall be paid in United States Dollars on the ninetieth (90) day following the Participant’s death or the Surviving Spouse’s death, whichever is applicable. The Participant’s Beneficiary shall not have the right to designate the taxable year of payment.

(c)

UK Pension Scheme Offset .

(i)

The amount of any Pension payable under the Plan shall be offset by the amount of the pension that the Participant would be entitled to receive under the UK Pension Scheme if he had elected to receive such pension at the same time and in the same form as the Pension payable under this Plan, all as determined under this subparagraph (i).

(A)

The offset for the initial payment of any Pension to be paid under the Plan shall be determined as of the date (the “Initial Offset Determination Date”) that is 30 days before the initial Payment Date. As of the Initial Offset Determination Date, the amount of the pension that would be payable under the UK Pension Scheme, which is expressed in Pounds Sterling, shall be converted into an equivalent amount expressed in terms of United States Dollars, using the average of exchange rates published in the Wall Street Journal on the first day of each month during the one-year period ending on the Initial Offset Determination Date.

(B)

The amount of the offset used in determining the amount of a Pension payable under the Plan shall be redetermined annually on the Redetermination Date in accordance with the provisions of this subparagraph (B) with the first such redetermination to be made as of the Redetermination Date following the initial Payment Date for the Pension and with redeterminations to be made each subsequent Redetermination Date. The effective date of any redetermination shall be the Adjustment Date following the Redetermination Date. As of each Redetermination Date following the initial Payment Date, the amount of the offset shall be redetermined based on the amount of the pension that would be payable under the UK Pension Scheme after adjustment for the increase under the terms of the UK Pension Scheme that would be effective on the following Adjustment Date. The redetermined offset shall be converted into an equivalent amount expressed in terms of United States Dollars, using the average of exchange rates published in the Wall Street Journal on the first day of each month during the one-year period ending on the Redetermination Date at which the redetermination is to be made.

(C)

As of each Redetermination Date, the offset redetermined and converted into an amount expressed in terms of United States Dollars in accordance with subparagraph (B) above shall be used to determine the Pension payable under the Plan annually at the same time as the Pension increase is determined under the provisions of Section 3.3, with any change in the amount of such Pension to be effective at the Adjustment Date following the redetermination of the offset.

(D)

The amount of any Pension payable under the Plan shall not be offset by the payment of any cash supplement under the UK Pension Scheme.

(E)

If the Participant has the right to commute (that is, exchange) the whole or part of any pension payable under the UK Pension Scheme for a cash sum, the offset described in this subparagraph (i) shall be determined assuming that the Participant has elected not to exercise such right to commute his pension for a cash sum.

(F)

The six-month delay required under Section 4.9 and the resulting lump sum that is payable on account of the delay under Section 4.4 shall be disregarded in determining the offset described in this subparagraph (i), that is, the offset shall be determined as if the six-month delay had not occurred and the lump sum had not been paid.

(ii)

Notwithstanding the provisions of subparagraph (i) above, if a lump sum is payable under paragraphs (b) or (c) of Section 5.2 of the Plan, then the amount of such lump sum shall be offset by the amount of the lump sum that the Participant would have been entitled to receive under the corresponding provisions of the UK Pension Scheme had the Participant elected to receive the pension payable to the Participant under the UK Pension Scheme at the same time and in the same form as the Pension payable under this Plan. The amount of the lump sum that would be payable under the UK Pension Scheme, which is expressed in terms of Pounds Sterling, shall be converted to United States Dollars using the average of the exchange rates published in the Wall Street Journal on the first day of each month during (A) the one-year period ending on the death of the Participant in the case of a payment under Section 5.2(b), or (B) the one-year period ending on the death of the Surviving Spouse in the case of a payment under 5.2(c).

3.5

Initial Action on Application . If the Plan fails to pay the benefits provided under the terms of the Plan to the Participant and/or his Beneficiary (the “Claimant”), then the Claimant or the Claimant’s authorized representative may make application for such benefits. Within 60 days (45 days in the case of a determination regarding Total Incapacity) following receipt of an application for benefits and all necessary documents and information, the Committee shall:

(a)

determine whether the Claimant claiming benefits (or with respect to whom benefits are claimed) is entitled to benefits under this Plan, and

(b)

furnish the Claimant with written notice of the decision rendered with respect to such application. Should special circumstances require an extension of time for processing the claim, written notice of the extension shall be furnished to the Claimant prior to the expiration of the initial 60 (or 45) day period. The notice shall indicate the special circumstances requiring an extension of time and the date by which a final decision is expected to be rendered. In no event shall the period of the extension exceed 90 days (30 days in the case of a determination of Total Incapacity) from the end of the initial 60 day (or 45 day) period. In the case of a denial of the Claimant’s application, the written notice thereof shall set forth specific reasons for the denial, with references to the Plan provisions upon which the denial is based, a description of any additional information or material necessary to perfect the application (together with an explanation why such material or information is necessary), and an explanation of the Plan’s claim review procedure including the right of the Claimant to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.

3.6

Appeal of Initial Decision .

(a)

If the Claimant does not agree with the initial decision rendered with respect to his application pursuant to Section 3.5 hereof he or his authorized representative may appeal such decision to the Committee. The appeal must be in writing and must be filed with the Committee within 65 days after the date of notice of the initial decision with respect to the application, or, if the application has neither been approved nor denied within the applicable period provided in Section 3.5 hereof, then the appeal must be filed within 65 days after the expiration of such applicable period.

(b)

The Claimant may request that his application be given full and fair review by the Committee. The Claimant may review all pertinent documents and submit issues and comments to the Committee in writing in connection with the appeal. The decision of the Committee shall be made promptly, and not later than 60 days (45 days in the case of a determination of Total Incapacity) after the Committee’s receipt of a request for review and all supporting documentation and information to be submitted by the Claimant, unless special circumstances require an extension of time for processing, in which case a decision shall be rendered as soon as possible, but not later than 120 days (90 days in the case of a determination of Total Incapacity) after receipt of a request for review and such supporting documentation and information. If special circumstances require such extension, a written notice will be provided to the Claimant prior to the expiration the initial 60-day (or 45-day) period. The notice shall indicate the special circumstances requiring an extension of time and the date by which a final decision is expected to be rendered. The Committee’s decision on review shall be in writing and shall include specific reasons for the decision, written in a manner calculated to be understood by the Claimant, with specific

3.7

Leave of Absence . In the event the Participant takes a leave of absence from active employment with the Employer, the Committee shall determine, in accordance with applicable regulations, whether such leave of absence shall be deemed to constitute a termination of employment with the Employer for purposes of this Plan. The employment relationship shall be treated as continuing intact while the Participant is on military leave, sick leave or other bona fide leave of absence (such as temporary employment by the government), if the period of leave does not exceed six months, or if longer, so long as the Participant’s right to reemployment with the Employer is provided either by statute or by contract. For purposes of the Plan, a leave of absence constitutes a bona fide leave of absence only if there is a reasonable expectation that the Participant will return to perform services for the Employer. If the period of leave exceeds six months and the Participant’s right to reemployment is not provided by statute or by contract, the employment relationship is deemed to terminate on the first day immediately following such six-month period. Notwithstanding the foregoing, where a leave of absence is due to any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than six months, where such impairme