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HARRIS CORPORATION RETIREMENT PLAN

Employee Benefits Plan Agreement

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This Employee Benefits Plan Agreement involves

HARRIS CORPORATION

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Title: HARRIS CORPORATION RETIREMENT PLAN
Governing Law: Florida     Date: 11/6/2007
Industry: Communications Equipment     Sector: Technology

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Exhibit 10(f)(i)
HARRIS CORPORATION RETIREMENT PLAN
(AMENDED AND RESTATED EFFECTIVE JULY 1, 2007)

 


 
Harris Corporation Retirement Plan
(Amended and Restated Effective July 1, 2007)
Table of Contents
                 
            Page  
ARTICLE 1     TITLE     1  
                 
ARTICLE 2     DEFINITIONS     1  
                 
ARTICLE 3     PARTICIPATION     16  
     Section 3.1  
Eligibility for Participation
    16  
     Section 3.2  
Election of Pre-Tax Contributions, Designated Roth and After-Tax Contributions
    17  
     Section 3.3  
Transfers to Affiliates
    18  
                 
ARTICLE 4     PRE-TAX, DESIGNATED ROTH, MATCHING AND PROFIT SHARING CONTRIBUTIONS     18  
     Section 4.1  
Pre-Tax Contributions and Designated Roth Contributions
    18  
     Section 4.2  
Matching Contributions
    21  
     Section 4.3  
Profit Sharing Contributions
    22  
     Section 4.4  
Deposit of Contributions
    23  
     Section 4.5  
Form of Contributions
    23  
                 
ARTICLE 5     AFTER-TAX AND ROLLOVER CONTRIBUTIONS     23  
     Section 5.1  
After-Tax Contributions
    23  
     Section 5.2  
Rollover Contributions
    25  
                 
ARTICLE 6     LIMITATIONS ON CONTRIBUTIONS     26  
     Section 6.1  
Annual Limit on Pre-Tax Contributions and Designated Roth Contributions
    26  
     Section 6.2  
Limits on Contributions for Highly Compensated Employees
    29  
     Section 6.3  
Maximum Annual Additions under Section 415 of the Code
    39  
     Section 6.4  
Other Limitations on Employer Contributions
    42  
                 
ARTICLE 7     TRUST AND INVESTMENT FUNDS     43  
     Section 7.1  
Trust
    43  
     Section 7.2  
Investments
    43  
                 
ARTICLE 8     PARTICIPANT ACCOUNTS AND INVESTMENT ELECTIONS     44  
     Section 8.1  
Participant Accounts
    44  
     -i-     

 


 
Table of Contents
(continued)
                 
            Page  
     Section 8.2  
Investment Elections
    46  
     Section 8.3  
Valuation of Funds and Plan Accounts
    47  
     Section 8.4  
Valuation of Units within the Harris Stock Fund
    47  
     Section 8.5  
Allocation of Contributions Other than Profit Sharing Contributions
    48  
     Section 8.6  
Allocation of Profit Sharing Contributions
    48  
     Section 8.7  
Correction of Error
    49  
                 
ARTICLE 9     WITHDRAWALS AND DISTRIBUTIONS     49  
     Section 9.1  
Withdrawals Prior to Termination of Employment
    49  
     Section 9.2  
Distribution of Account Upon Termination of Employment
    54  
     Section 9.3  
Time and Form of Distribution upon Termination of Employment
    56  
     Section 9.4  
Payment of Small Account Balances
    59  
     Section 9.5  
Medium and Order of Withdrawal or Distribution
    59  
     Section 9.6  
Direct Rollover Option
    60  
     Section 9.7  
Designation of Beneficiary
    61  
     Section 9.8  
Missing Persons
    62  
     Section 9.9  
Distributions to Minor and Disabled Distributees
    63  
     Section 9.10  
Payment of Group Insurance Premiums
    64  
                 
ARTICLE 10     LOANS     64  
     Section 10.1  
Making of Loans
    64  
     Section 10.2  
Restrictions
    65  
     Section 10.3  
Default
    65  
     Section 10.4  
Applicability
    66  
                 
ARTICLE 11      SPECIAL PARTICIPATION AND DISTRIBUTION RULES     66  
     Section 11.1  
Change of Employment Status
    66  
     Section 11.2  
Reemployment of a Terminated Participant
    66  
     Section 11.3  
Employment by Affiliates
    67  
     Section 11.4  
Leased Employees
    67  
     Section 11.5  
Reemployment of Veterans
    68  
     -ii-     

 


 
Table of Contents
(continued)
                 
            Page  
ARTICLE 12       
SHAREHOLDER RIGHTS WITH RESPECT TO HARRIS STOCK
    71  
     Section 12.1  
Voting Shares of Harris Stock
    71  
     Section 12.2  
Tender Offers
    71  
                 
ARTICLE 13      ADMINISTRATION     74  
     Section 13.1  
The Administrative Committee
    74  
     Section 13.2  
Named Fiduciaries
    76  
     Section 13.3  
Allocation and Delegation of Responsibilities
    77  
     Section 13.4  
Professional and Other Services
    77  
     Section 13.5  
Indemnification and Expense Reimbursements
    77  
     Section 13.6  
Claims Procedure
    78  
     Section 13.7  
Notices to Participants
    80  
     Section 13.8  
Notices to Administrative Committee or Employers
    80  
     Section 13.9  
Electronic Media
    81  
     Section 13.10  
Records
    81  
     Section 13.11  
Reports of Trustee and Accounting to Participants
    81  
     Section 13.12  
Limitations on Investments and Transactions/ Conversions
    81  
                 
ARTICLE 14      PARTICIPATION BY EMPLOYERS     83  
     Section 14.1  
Adoption of Plan
    83  
     Section 14.2  
Withdrawal from Participation
    83  
     Section 14.3  
Company, Administrative Committee, Compensation Committee, Executive Committee and Investment Committee as Agents for Employers
  83
     Section 14.4  
Continuance by a Successor
    84  
                 
ARTICLE 15      MISCELLANEOUS     85  
     Section 15.1  
Expenses
    85  
     Section 15.2  
Non-Assignability
    85  
     Section 15.3  
Employment Non-Contractual
    86  
     Section 15.4  
Merger or Consolidation with Another Plan/Transfer Contributions
    86  
     Section 15.5  
Gender and Plurals
    87  
     Section 15.6  
Statute of Limitations for Actions Under the Plan
    88  
     Section 15.7  
Applicable Law
    88  
     -iii-     

 


 
Table of Contents
(continued)
                 
            Page  
     Section 15.8  
Severability
    88  
     Section 15.9  
No Guarantee
    88  
     Section 15.10  
Plan Voluntary
    89  
                 
ARTICLE 16      TOP-HEAVY PLAN REQUIREMENTS     89  
     Section 16.1  
Top-Heavy Plan Determination
    89  
     Section 16.2  
Definitions and Special Rules
    90  
     Section 16.3  
Minimum Contribution for Top-Heavy Years
    91  
                 
ARTICLE 17      AMENDMENT, ESTABLISHMENT OF SEPARATE PLAN, PLAN TERMINATION AND CHANGE OF CONTROL     92  
     Section 17.1  
Amendment
    92  
     Section 17.2  
Establishment of Separate Plan
    92  
     Section 17.3  
Termination
    93  
     Section 17.4  
Change of Control
    93  
     Section 17.5  
Trust Fund to Be Applied Exclusively for Participants and Their Beneficiaries
    94  
     -iv-     

 


 
ARTICLE 1
TITLE
     The title of this Plan shall be the “Harris Corporation Retirement Plan.” This Plan is an amendment and restatement of the Plan in effect as of June 30, 2007. Except as otherwise provided herein, this amendment and restatement shall be effective as of July 1, 2007.
     The rights and benefits of any Participant whose employment with all Employers and Affiliates terminates on or after July 1, 2007, and the rights and benefits of any Beneficiary of any such Participant, shall be determined solely by reference to the terms of the Plan as amended and restated herein, as such plan may be amended from time to time. The rights and benefits of any Participant whose employment with all Employers and Affiliates terminated prior to July 1, 2007 and who is not reemployed after such date, and the rights and benefits of any Beneficiary of any such Participant, generally shall be determined solely by reference to the terms of the Plan as in effect on the date of the Participant’s termination of employment.
     The Plan is designated as a “profit sharing plan” within the meaning of U.S. Treasury Regulation section 1.401-1(a)(2)(ii).
ARTICLE 2
DEFINITIONS
     As used herein, the following words and phrases shall have the following respective meanings when capitalized:
      Account . The aggregate of a Participant’s subaccounts described in Section 8.1 and such other subaccounts that may be established from time to time on behalf of a Participant, to be credited with contributions made by or on behalf of the Participant, adjusted for earnings and losses, and debited by distributions to and withdrawals of the Participant and expenses.

 


 
      Administrative Committee . The Employee Benefits Committee of the Company or any successor thereto that is appointed pursuant to Section 13.1 to administer the Plan. Reference herein to the Administrative Committee also shall include any person or entity to whom the Administrative Committee has delegated any of its authority pursuant to Section 13.3 to the extent of the delegation.
      Affiliate . (a) A corporation that is a member of the same controlled group of corporations (within the meaning of section 414(b) of the Code) as an Employer, (b) a trade or business (whether or not incorporated) under common control (within the meaning of section 414(c) of the Code) with an Employer, (c) any organization (whether or not incorporated) that is a member of an affiliated service group (within the meaning of section 414(m) of the Code) that includes an Employer, a corporation described in clause (a) of this subdivision or a trade or business described in clause (b) of this subdivision, or (d) any other entity that is required to be aggregated with an Employer pursuant to Regulations promulgated under section 414(o) of the Code.
      After-Tax Account . The subaccount established pursuant to Section 8.1 to which any after-tax contributions made for the benefit of a Participant pursuant to Section 5.1, and earnings and losses thereon, are credited.
      Beneficiary . A person entitled under Section 9.7 to receive benefits in the event of the death of a Participant.
      Board . The Board of Directors of the Company.
      Break in Service . A period other than a period included in an Employee’s Service; provided , however , that a Break in Service shall not include a period of absence from employment not in excess of 24 consecutive months because of (a) the Employee’s pregnancy,

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(b) the birth of the Employee’s child, (c) the placement of a child with the Employee in connection with the Employee’s adoption of such child or (d) the need of the Employee to care for any such child for a period beginning immediately following such birth or placement. Notwithstanding the foregoing, the immediately preceding sentence shall not apply unless the Employee timely furnishes to the Administrative Committee or its delegate such information as it may reasonably require to establish the reason for such absence and its duration.
      Change of Control . For purposes hereof, a “Change of Control” shall be deemed to have occurred if:
     (a) any “person” (as such term is defined in section 3(a)(9) of the Securities Exchange Act of 1934 (the “Exchange Act”) and as used in sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 20% or more of the combined voting power of the Company’s then outstanding securities eligible to vote for the election of the Board (the “Company Voting Securities”); provided however , that the event described in this paragraph (a) shall not be deemed to be a Change of Control by virtue of any of the following acquisitions: (1) by the Company or any Subsidiary, (2) by any employee benefit plan sponsored or maintained by the Company or any Subsidiary, (3) by any underwriter temporarily holding securities pursuant to an offering of such securities, or (4) pursuant to a “Non-Control Transaction” (as defined in paragraph (c));
     (b) individuals who, on July 1, 2006, constitute the Board (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to July 1, 2006, whose election or

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nomination for election was approved by a vote of at least two-thirds of the Incumbent Directors who remain on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without objection to such nomination) shall also be deemed to be an Incumbent Director; provided , however , that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to directors or any other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board shall be deemed to be an Incumbent Director;
     (c) the consummation of a merger, consolidation, share exchange or similar form of corporate reorganization of the Company or any such type of transaction involving the Company or any of its Subsidiaries that requires the approval of the Company’s stockholders (whether for such transaction or the issuance of securities in the transaction or otherwise) (a “Business Combination”), unless immediately following such Business Combination: (1) more than 80% of the total voting power of the corporation resulting from such Business Combination (including, without limitation, any corporation which directly or indirectly has beneficial ownership of 100% of the Company Voting Securities) eligible to elect directors of such corporation is represented by shares that were Company Voting Securities immediately prior to such Business Combination (either by remaining outstanding or being converted), and such voting power is in substantially the same proportion as the voting power of such Company Voting Securities immediately prior to the Business Combination, (2) no person (other than any publicly traded holding company resulting from such Business Combination or any employee benefit plan sponsored or maintained by the Company (or the corporation resulting from such

4


 
Business Combination)), becomes the beneficial owner, directly or indirectly, of 20% or more of the total voting power of the outstanding voting securities eligible to elect directors of the corporation resulting from such Business Combination, and (3) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were Incumbent Directors at the time of the Board’s approval of the execution of the initial agreement providing for such Business Combination (any Business Combination which satisfies the conditions specified in (1), (2) and (3) shall be deemed to be a “Non-Control Transaction”); or
     (d) the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company or the direct or indirect sale or other disposition of all or substantially all of the assets of the Company and its Subsidiaries.
     Notwithstanding the foregoing, a “Change of Control” shall not occur solely because any person acquires beneficial ownership of 20% or more of the Company Voting Securities as a result of the acquisition of Company Voting Securities by the Company which reduces the number of Company Voting Securities outstanding; provided however , that if after such acquisition by the Company such person becomes the beneficial owner of additional Company Voting Securities that increase the percentage of outstanding Company Voting Securities beneficially owned by such person, a “Change of Control” shall then occur.
     For purposes of this definition of “Change of Control,” the term “Subsidiary” shall mean any corporation or other entity in which the Company has a direct or indirect ownership interest of 50% or more of the total combined voting power of the then outstanding securities of such corporation or other entity entitled to vote generally in the election of directors

5


 
or in which the Company has the right to receive 50% or more of the distribution of profits or 50% or more of the assets on liquidation or dissolution.
      Code . The Internal Revenue Code of 1986, as amended.
      Company . Harris Corporation, a Delaware corporation, and any successor thereto.
      Compensation . The following items of remuneration which a Participant is paid for work or personal services performed for an Employer: (a) salary or wages, including lump sum merit increases; (b) commission paid pursuant to a sales incentive plan; (c) overtime premium, shift differential or additional compensation in lieu of overtime premium; (d) compensation in lieu of vacation; and (e) any annual bonus or incentive compensation payable in the form of cash pursuant to an Employer’s Annual Incentive Plan, an Employer’s Performance Reward Plan, or other similar plan or award program adopted from time to time by an Employer or any stock award made in lieu of an annual cash bonus or incentive compensation; provided , however , that Compensation also shall include any remuneration which would have been paid to the Participant for work or personal services performed for an Employer but for the Participant’s election to have his or her compensation reduced pursuant to a qualified cash or deferred arrangement described in section 401(k) of the Code, a cafeteria plan described in section 125 of the Code or an arrangement providing qualified transportation fringes described in section 132(f) of the Code; provided further that the remuneration described in this paragraph shall be Compensation for purposes of the Plan only if it is paid on or before the later of (i) 2 1 / 2 months after the Participant’s severance from employment and (ii) the last day of the Plan Year during which the Participant’s severance from employment occurs (the “Timing Limitation”), except that the Timing Limitation shall not apply to payments to a Participant who does not perform

6


 
services for an Employer at the time of payment by reason of Qualified Military Service to the extent that such payments do not exceed the amounts such Participant would have received if the Participant had continued to perform services for the Employer rather than entering Qualified Military Service.
     Notwithstanding the foregoing, the following items also shall be excluded from “Compensation”: (1) any extraordinary compensation of a recurring or non-recurring nature not included under items (a) through (e) above, including one-time recognition awards and rewards under a referral program of an Employer; (2) any award made or amount paid pursuant to the Harris Corporation Stock Incentive Plan or any successor thereto, including, but not limited to, performance shares, stock options, restricted stock, stock appreciation rights or other stock-based awards or dividend equivalents; (3) severance pay, separation pay, special retirement pay or parachute payments; (4) retention bonuses or completion bonuses, unless authorized by the Administrative Committee in a uniform and nondiscriminatory manner to be included in Compensation; (5) reimbursement or allowances with respect to expenses incurred in connection with employment, such as tax equalization, reimbursement for moving expenses, mileage or expense allowance or education expenses; (6) indirect compensation such as employer-paid group insurance premiums or contributions under this Plan or any other qualified employee benefit plan, other than contributions described in the immediately preceding paragraph or (7) payments under a nonqualified unfunded deferred compensation plan.
     Notwithstanding any provision herein to the contrary, the Compensation of a Participant taken into account for any purpose under the Plan shall not exceed $225,000 (as adjusted pursuant to section 401(a)(17)(B) of the Code). In addition, in the Plan Year in which

7


 
an Eligible Employee becomes a Participant, only Compensation received on or after the date he or she becomes a Participant shall be taken into account under the Plan.
      Compensation Committee . The Management Development and Compensation Committee of the Board. Reference herein to the Compensation Committee also shall include any person or entity to whom the Compensation Committee has delegated any of its authority pursuant to Section 13.3.
      Designated Roth Account . The subaccount established pursuant to Section 8.1 to which any designated Roth contributions made for the benefit of a Participant pursuant to Section 4.1, and earnings and losses thereon, are credited.
      Disability . A Participant’s total and permanent physical or mental disability, as evidenced by the Participant’s eligibility for disability benefits under Title II or Title XVI of the Federal Social Security Act. A Participant’s Disability shall be deemed to occur as of the effective date determined by the Social Security Administration.
      Effective Date . The effective date of this amendment and restatement of the Plan, which, with respect to the Company and any other Employer as of June 30, 2007, shall, except as otherwise provided herein, be July 1, 2007 and, with respect to an entity that becomes an Employer on or after July 1, 2007, shall be the effective date as of which the Plan is adopted by such entity.
      Eligible Employee . An Employee other than an Employee (a) the terms of whose employment are subject to a collective bargaining agreement which does not provide for the participation of such Employee in the Plan; (b) who does not receive any Compensation payable in United States dollars; (c) who is not treated as an Employee of an Employer on such Employer’s payroll records (notwithstanding any determination by a court or administrative

8


 
agency that such individual is an Employee); (d) who is not a United States citizen or a resident alien and who provides services in a location other than the United States or (e) who is eligible to participate in, or will be eligible to participate in after satisfaction of applicable age, service or entry date requirements, any other United States tax-qualified defined contribution plan sponsored or maintained by the Company or any of its subsidiaries. No individual who renders services for an Employer shall be an Eligible Employee if such individual renders services pursuant to an agreement or arrangement (written or oral) (1) that such services are to be rendered by the individual as an independent contractor; (2) with an entity, including a leasing organization within the meaning of section 414(n)(2) of the Code, that is not an Employer or Affiliate or (3) that contains a waiver of participation in the Plan.
      Eligible Profit Sharing Participant . For any Plan Year, a Participant who has completed a Year of Service on or prior to the last day of the applicable Plan Year and who (a) is actively employed as an Eligible Employee on the earlier of (1) the last day of such Plan Year or (2) the June 30th nearest to the last day of such Plan Year (the “Eligibility Date”); (b) was actively employed as an Eligible Employee during such Plan Year but is not actively employed on the Eligibility Date due to Leave of Absence or a period of Qualified Military Service; or (c) was actively employed as an Eligible Employee during such Plan Year but terminated employment during such Plan Year (1) on or after the attainment of age 55, (2) due to death or Disability, (3) as a result of a Reduction in Force or (4) as a result of a transfer from employment with an Employer to employment with an Affiliate that is not an Employer.
      Eligible Retirement Plan . Any of (i) an individual retirement account described in section 408(a) of the Code, (ii) an individual retirement annuity described in section 408(b) of the Code (other than an endowment contract), (iii) an employees’ trust described in section

9


 
401(a) of the Code which is exempt from tax under section 501(a) of the Code, (iv) an annuity plan described in section 403(a) of the Code; (v) an eligible deferred compensation plan described in section 457(b) of the Code which is maintained by a state, political subdivision of a state or any agency or instrumentality of a state or political subdivision of a state and (vi) an annuity contract described in section 403(b) of the Code.
      Employee . An individual whose relationship with an Employer is, under common law, that of an employee.
      Employer . The Company or any other entity that, with the consent of the Compensation Committee, elects to participate in the Plan in the manner described in Section 14.1, including any successor entity that is substituted for an Employer pursuant to Section 14.4. If an Employer withdraws from participation in the Plan pursuant to Section 14.2, or terminates its participation in the Plan pursuant to Section 17.3, it shall thereupon cease to be an Employer. An entity automatically shall cease being an Employer as of the date it ceases to be an Affiliate, unless the Compensation Committee consents to such entity’s continued participation in the Plan.
      ERISA . The Employee Retirement Income Security Act of 1974, as amended.
      Executive Committee . The Executive and Finance Committee of the Board (or such other committee of the Board as the Board may designate from time to time). Reference herein to the Executive Committee also shall include any person or entity to whom the Executive Committee has delegated any of its authority pursuant to Section 13.3.
      Fiscal Year . The fiscal year of the Company.

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      Full-Time Employee . An Employee who regularly is scheduled by an Employer to work 30 or more hours per week and who is not designated on the payroll records of an Employer as a temporary employee, intern, or co-op employee.
      Harris Stock . Common stock of the Company.
      Harris Stock Fund . An investment option, the assets of which consist primarily of shares of Harris Stock.
      Highly Compensated Employee . For a Plan Year, any Employee who (a) is a 5%-owner (as determined under section 416(i)(1) of the Code) at any time during the current Plan Year or the preceding Plan Year or (b) for the preceding Plan Year, was paid compensation in excess of $100,000 (as adjusted in accordance with section 414(q)(1)(B) of the Code) from an Employer or Affiliate and was a member of the “top-paid group” (as defined in section 414(q)(3) of the Code).
      HITS Business Unit Employee . An Eligible Employee of an Employer that is designated as a member of the Harris Information Technology Services Business Unit, including without limitation, Harris Technical Services Corporation and Multimax Incorporated.
      Hour of Service . Each hour for which an Employee is paid or entitled to payment for the performance of duties for an Employer.
      Investment Committee . The Investment Committee—Employee Benefit Plans of the Company. Reference herein to the Investment Committee also shall include any person or entity to whom the Investment Committee has delegated any of its authority pursuant to Section 13.3.
      Leave of Absence . A period of interruption of the active employment of an Employee granted by an Employer or Predecessor Company with the understanding that the

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Employee will return to active employment at the expiration of such period (or such extension thereof granted by the Employer or Predecessor Company). The term “Leave of Absence” does not include a period of Qualified Military Service.
      Legacy HTSC Employee . An Eligible Employee who as of June 30, 2007 (i) was an Employee of Harris Technical Services Corporation and (ii) was a Participant in the Plan.
      Matching Account . The subaccount established pursuant to Section 8.1 to which any matching contributions made for the benefit of a Participant pursuant to Section 4.2, and earnings and losses thereon, are credited.
      Matching Eligibility Requirement . The period of Service that a Participant must complete to permit the Participant to be eligible to receive matching contributions pursuant to Section 4.2. For a HITS Business Unit Employee, such period is six months. For an Eligible Employee other than a HITS Business Unit Employee, such period is one Year of Service.
      Maximum Contribution Percentage . The maximum percentage of a Participant’s Compensation (other than PRP Compensation) for a payroll period that may be contributed to the Plan pursuant to Section 5.1(a), as determined from time to time by the Administrative Committee. The Administrative Committee in its sole discretion may establish different Maximum Contribution Percentages with respect to Participants who are not Highly Compensated Employees for a given Plan Year and Participants who are Highly Compensated Employees for such Plan Year, and with respect to classes of Highly Compensated Employees for a given Plan Year.
      Maximum Deferral Percentage . The maximum percentage of a Participant’s Compensation (other than PRP Compensation) for a payroll period that may be contributed to the Plan pursuant to Section 4.1(a), as determined from time to time by the Administrative

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Committee. The Administrative Committee in its sole discretion may establish different Maximum Deferral Percentages with respect to Participants who are not Highly Compensated Employees for a given Plan Year and Participants who are Highly Compensated Employees for such Plan Year, and with respect to classes of Highly Compensated Employees for a given Plan Year.
      Participant . An Eligible Employee who has satisfied the requirements set forth in Section 3.1. An individual shall cease to be a Participant upon the complete distribution of his or her vested Account.
      Plan . The plan herein set forth, as from time to time amended.
Plan Year . The Fiscal Year.
      Predecessor Company . Any entity (a) of which an Affiliate is a successor by reason of having acquired all or substantially all of its business and assets or (b) from which an Affiliate acquired a business formerly conducted by such entity; provided , however , that in the case of any such entity that continues to conduct a trade or business subsequent to the acquisition by an Affiliate referred in (a) or (b) above, the status of such entity as a Predecessor Company relates only to the period of time prior to the date of such acquisition.
      Pre-Tax Account . The subaccount established pursuant to Section 8.1 to which any pre-tax contributions made for the benefit of a Participant pursuant to Section 4.1, and earnings and losses thereon, are credited.
      Profit Sharing Account . The subaccount established pursuant to Section 8.1 to which any profit sharing contributions made for the benefit of a Participant pursuant to Section 4.3, and earnings and losses thereon, are credited.

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      PRP Compensation . Compensation payable to a Participant pursuant to an Employer’s Performance Reward Plan or any similar broad-based cash incentive plan, or any successor plan thereto.
      Qualified Military Service . An individual’s service in the uniformed services (as defined in 38 U.S.C. § 4303) if such individual is entitled to reemployment rights under USERRA with respect to such service.
      Reduction in Force . An involuntary or voluntary reduction in force, as defined in the Company’s Severance Pay Plan.
      Regulations . Written regulations promulgated by the Department of Labor construing Title I of ERISA or by the Internal Revenue Service construing the Code.
      Rollover Account . The subaccount established pursuant to Section 8.1 to which any rollover contributions made by a Participant pursuant to Section 5.2, and earnings and losses thereon, are credited.
      Savings Account . The subaccount established pursuant to Section 8.1 to which any savings contributions under the Plan as in effect prior to July 1, 1983, and earnings and losses thereon, are credited.
      Service . The aggregate of the periods during which an Employee is employed by an Employer and any periods of employment or service taken into account pursuant to Sections 11.3 and 11.4, subject to the following:
     (a) An Employee shall be deemed to be employed by an Employer during (1) any period of absence from employment by an Employer that is of less than twelve months’ duration, (2) the first twelve months of any period of absence from employment by an Employer for any reason other than the Employee’s quitting, retiring, being

14


 
discharged or death, and (3) any period of absence from employment by an Employer during which the Employee is in Qualified Military Service, provided that the Employee returns to the employ of an Employer within the period prescribed by USERRA.
     (b) An Employee’s period of employment by an entity other than an Affiliate that becomes a Predecessor Company shall be included as Service only to the extent expressly provided in the documents effecting the acquisition or otherwise required by law.
     (c) An Employee’s period of employment by an entity in which the Company owns less than 80% but more than 1% of the outstanding equity interest (a “joint venture”) shall be included as Service if (1) the Company or its delegate designates employment with the joint venture as eligible for service credit under the Plan; (2) such Employee was employed by an Affiliate prior to such Employee’s employment by the joint venture and was not employed by any person or entity other than an Affiliate (an “unrelated employer”) between such Employee’s employment by an Affiliate and the joint venture; and (3) such Employee returns to employment with an Affiliate following the Employee’s termination of employment with the joint venture without having been employed by an unrelated employer between such Employee’s employment by the joint venture and an Affiliate.
     (d) Solely for purposes of determining the nonforfeitable portion of a Participant’s Account under Section 9.2(b), if an Employee (1) is terminated by an Employer or Affiliate in connection with a Reduction in Force and (2) has, as of the date of such termination, completed at least one Year of Service, the Service of the Employee

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shall include the first twelve months of absence from employment, effective as of the date of such termination of employment.
Service shall be computed in terms of completed years, completed months and completed days.
      Trust . The trust described in Section 7.1 and created by agreement between the Company and the Trustee.
      Trust Fund . All money and property of every kind of the Trust held by the Trustee pursuant to the terms of the agreement governing the Trust.
      Trustee . The person or entity appointed by the Executive Committee and serving as trustee of the Trust or, if there is more than one such trustee acting at a particular time, all of such trustees collectively.
      USERRA . The Uniformed Services Employment and Reemployment Rights Act of 1994, as amended.
      Valuation Date . Each day on which the New York Stock Exchange is open for trading and any other day determined by the Administrative Committee.
      Wage Determination HES Employee . An Eligible Employee performing services for the Harris Enterprise Services business unit of Harris Technical Services Corporation who is covered by a wage determination contract.
      Year of Service . A period of Service of 365 days.
ARTICLE 3
PARTICIPATION
     Section 3.1. Eligibility for Participation . Each Eligible Employee who was a Participant immediately before the Effective Date shall continue to be a Participant as of the

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Effective Date. Each other Eligible Employee shall become a Participant on the day he or she first performs an Hour of Service.
     Section 3.2. Election of Pre-Tax Contributions, Designated Roth Contributions and After-Tax Contributions . (a) Participant Election . A Participant who desires to make pre-tax contributions, designated Roth contributions or after-tax contributions to the Plan shall make an election, in accordance with procedures prescribed by the Administrative Committee, specifying the Participant’s chosen rate of such contributions. Such election shall authorize the Participant’s Employer to reduce the Participant’s Compensation by the amount of any such pre-tax contributions, shall authorize the Participant’s Employer to make regular payroll deductions of any such designated Roth contributions or after-tax contributions, and shall evidence the Participant’s acceptance and agreement to all provisions of the Plan. Any election made pursuant to this Section 3.2(a) shall be effective only with respect to Compensation not currently available to the Participant as of the effective date of such election and shall be effective as of the first payroll period commencing after the date on which the election is received, or such later date as may be administratively practicable; provided , however, that an election with respect to PRP Compensation shall be effective for the first payment of PRP Compensation following the election.
     (b)  Deemed Election for Full-Time Employees . A Participant who is a Full-Time Employee and who does not at the time and in the manner prescribed by the Administrative Committee elect otherwise shall be deemed to have elected to make pre-tax contributions to the Plan each payroll period at the rate of 6% of the Participant’s Compensation (other than PRP Compensation) for such payroll period and to have authorized the Participant’s Employer to reduce his or her Compensation by the amount thereof. Any deemed election described in this

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Section 3.2(b) shall be effective only with respect to Compensation not currently available to the Participant as of the effective date of the deemed election and shall be effective as of the first payroll period commencing after the Participant becomes eligible to participate in the Plan, or such later date as may be administratively practicable.
     Section 3.3. Transfers to Affiliates . If a Participant is transferred from one Employer to another Employer or from an Employer to an Affiliate that is not an Employer, such transfer shall not terminate the Participant’s participation in the Plan, and such Participant shall continue to participate in the Plan until an event occurs which would have entitled the Participant to a complete distribution of the Participant’s vested interest in his or her Account had the Participant continued to be employed by an Employer until the occurrence of such event. Notwithstanding the foregoing, a Participant shall not be entitled to make pre-tax contributions, designated Roth contributions, after-tax contributions or rollover contributions to the Plan, to receive under the Plan allocations of matching contributions or to receive under the Plan allocations of profit sharing contributions during any period of employment by an Affiliate that is not an Employer, and periods of employment by an Affiliate that is not an Employer shall be taken into account only to the extent set forth in Section 11.3. Payments that are received by a Participant from an Affiliate that is not an Employer shall not be treated as Compensation for any purpose under the Plan.
ARTICLE 4
PRE-TAX, DESIGNATED ROTH, MATCHING AND PROFIT SHARING CONTRIBUTIONS
     Section 4.1. Pre-Tax Contributions and Designated Roth Contributions . (a) Initial Election . Subject to the limitations set forth in Article 6, each Employer shall make a

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pre-tax contribution and/or a designated Roth contribution for each payroll period on behalf of each Participant who is an Eligible Employee of such Employer in an amount equal to a whole percentage of such Participant’s Compensation (other than PRP Compensation) for such payroll period as elected by the Participant pursuant to Section 3.2. The percentage of Compensation so designated by a Participant for a payroll period may not be less than 1% and may not be more than the Maximum Deferral Percentage with respect to such Participant. Notwithstanding the foregoing, the aggregate of a Participant’s pre-tax contributions and designated Roth contributions for a payroll period pursuant to this Section 4.1(a) and a Participant’s after-tax contributions for a payroll period pursuant to Section 5.1(a) may not exceed an amount equal to the Maximum Deferral Percentage with respect to such Participant.
     (b)  Changes in the Rate or Suspension of Pre-Tax Contributions and Designated Roth Contributions . A Participant’s pre-tax contributions and designated Roth contributions pursuant to Section 4.1(a) shall continue in effect at the rate elected by the Participant pursuant to Section 3.2 until the Participant changes or suspends such election. A Participant may change or suspend such election at such time and in such manner as may be prescribed by the Administrative Committee, provided that only the last change made by a Participant during a payroll period shall be effectuated. Such change or suspension shall be effective as of the first payroll period commencing after the date on which the change or suspension is received, or such later payroll period as may be administratively practicable. A Participant who has suspended pre-tax contributions or designated Roth contributions pursuant to this subsection may resume pre-tax contributions or designated Roth contributions by making an election at such time and in such manner as may be prescribed by the Administrative Committee.

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     (c)  Performance Reward Plan Deferral Election . Subject to the limitations set forth in Article 6, a Participant may elect, in accordance with procedures prescribed by the Administrative Committee, to have his or her Employer make a pre-tax contribution and/or a designated Roth contribution on his or her behalf of PRP Compensation, if any. The percentage of PRP Compensation so elected by a Participant pursuant to this Section 4.1(c), when aggregated with the percentage of PRP Compensation contributed to the Plan on an after-tax basis pursuant to Section 5.1(c), shall be 0%, 50% or 100%.
     (d)  Catch-Up Contributions . Each Participant who (i) is eligible to make pre-tax contributions or designated Roth contributions under the Plan and (ii) will attain age 50 before the end of a calendar year ending with or within a Plan Year shall be eligible to have pre-tax contributions and/or designated Roth contributions made on his or her behalf in addition to those described in Sections 4.1(a) and (c) (“catch-up contributions”). Catch-up contributions shall be elected, made, suspended, resumed and credited in accordance with and subject to the rules and limitations of section 414(v) of the Code and such other rules and limitations prescribed by the Administrative Committee from time to time; provided , however , that (i) the amount of catch-up contributions made on behalf of a Participant during a calendar year shall not exceed the maximum amount permitted under section 414(v)(2) of the Code for the calendar year ($5,000 for 2007) and (ii) the amount of catch-up contributions made on behalf of a Participant for a payroll period shall not exceed the percentage of the Participant’s Compensation that is established from time to time by the Administrative Committee. Catch-up contributions shall not be taken into account for purposes of Sections 6.1 and 6.3, and the Plan shall not be treated as failing to satisfy its provisions implementing the requirements of section 401(k)(3), 401(k)(11),

20


 
401(k)(12), 410(b) or 416 of the Code, as applicable, by reason of the making of catch-up contributions.
     (e)  Designation of Contributions as Pre-Tax Contributions or Designated Roth Contributions . Elections by Participants to commence, change, suspend or resume contributions under this Section 4.1 shall designate (i) the portion of such contributions that are to be pre-tax contributions excludable from the Participant’s gross income pursuant to section 402(g) of the Code and (ii) the portion of such contributions that are to be designated Roth contributions includable in the Participant’s gross income pursuant to section 402A of the Code. Such designations shall be irrevocable with respect to contributions made pursuant to such elections.
     Section 4.2. Matching Contributions . (a) In General . Subject to the limitations set forth in Article 6, each Employer shall make a matching contribution for each payroll period on behalf of each Participant who is an Eligible Employee of such Employer, and who has satisfied the Matching Eligibility Requirement. The rate of matching contribution shall be as set forth in Section 4.2(b), (c) or (d), as applicable.
     (b)  Wage Determination HES Employees . The rate of matching contribution with respect to a Wage Determination HES Employee shall equal 50% of the aggregate of (i) the pre-tax contribution and/or designated Roth contribution made on behalf of such Participant pursuant to Section 4.1(a) and (ii) the after-tax contribution made on behalf of such Participant pursuant to Section 5.1(a); provided , however , that the matching contribution shall not exceed 4% of the Participant’s Compensation for a payroll period.
     (c)  HITS Business Unit Employees Other Than Wage Determination HES Employees . The rate of matching contribution with respect to a HITS Business Unit Employee who is a Legacy HTSC Employee shall equal 100% of the aggregate of (i) the pre-tax

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contribution and/or designated Roth contribution made on behalf of such Participant pursuant to Section 4.1(a) and (ii) the after-tax contribution made on behalf of such Participant pursuant to Section 5.1(a). The rate of matching contribution with respect to a HITS Business Unit Employee who is neither a Wage Determination HES Employee nor a Legacy HTSC Employee shall equal 50% of the aggregate of (i) the pre-tax contribution and/or designated Roth contribution made on behalf of such Participant pursuant to Section 4.1(a) and (ii) the after-tax contribution made on behalf of such Participant pursuant to Section 5.1(a). In each case, however, the matching contribution shall not exceed 6% of the Participant’s Compensation for a payroll period.
     (d)  Eligible Employees Other Than HITS Business Unit Employees . The rate of matching contribution with respect to an Eligible Employee other than a HITS Business Unit Employee shall equal 100% of the aggregate of (i) the pre-tax contribution and/or designated Roth contribution made on behalf of such Participant pursuant to Section 4.1(a) and (ii) the after-tax contribution made on behalf of such Participant pursuant to Section 5.1(a); provided , however , that the matching contribution shall not exceed 6% of the Participant’s Compensation for a payroll period.
     (e)  Contributions Not Eligible for Match . Notwithstanding the foregoing, an Employer shall not make a matching contribution with respect to (i) any contribution to the Plan of PRP Compensation, irrespective of whether such contribution is made pursuant to Section 4.1(c) or Section 5.1(c) or (ii) any catch-up contribution made pursuant to Section 4.1(d).
     Section 4.3. Profit Sharing Contributions . Subject to the limitations set forth in Article 6, each Plan Year the Employers in their discretion may make a profit sharing contribution to the Trust in such amount as the Employers in their discretion may determine.

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Such discretionary profit sharing contribution shall be allocated pursuant to Section 8.6 among Eligible Profit Sharing Participants for the Plan Year.
     Section 4.4. Deposit of Contributions . An Employer shall deliver to the Trustee any pre-tax contributions and designated Roth contributions as soon as administratively practicable after the date such contributions otherwise would have been paid to the Participants as cash compensation, but in no event later than the 15th business day of the month following the month during which such contributions otherwise would have been paid to the Participants. An Employer shall deliver to the Trustee any matching contributions concurrently with the delivery of the pre-tax contributions, designated Roth contributions or after-tax contributions to which such matching contributions relate. An Employer shall deliver to the Trustee any profit sharing contribution for a Plan Year no later than the date prescribed by the Code, including any authorized extensions thereof, for filing such Employer’s federal income tax return for the Fiscal Year which ends with such Plan Year.
     Section 4.5. Form of Contributions . Subject to Section 7.2(b) with respect to contributions invested in the Harris Stock Fund, pre-tax contributions, designated Roth contributions, matching contributions and profit sharing contributions shall be contributed to the Plan in cash.
ARTICLE 5
AFTER-TAX AND ROLLOVER CONTRIBUTIONS
     Section 5.1. After-Tax Contributions . (a) Initial Election . Subject to the limitations set forth in Article 6, each Participant may elect in accordance with Section 3.2 to make an after-tax contribution of Compensation (other than PRP Compensation) for each payroll period by payroll deduction. The percentage of Compensation so designated for a payroll period

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shall be a whole percentage not less than 1% and not more than the Maximum Contribution Percentage with respect to such Participant. Notwithstanding the foregoing, the aggregate of a Participant’s pre-tax contributions and designated Roth contributions for a payroll period pursuant to Section 4.1(a) and a Participant’s after-tax contributions for a payroll period pursuant to this Section 5.1(a) may not exceed an amount equal to the Maximum Contribution Percentage with respect to such Participant. An Employer shall deliver to the Trustee any after-tax contributions as soon as administratively practicable after the date such contributions otherwise would have been paid to the Participants as cash compensation, but in no event later than the 15th business day of the month following the month during which such contributions otherwise would have been paid to the Participants.
     (b)  Changes in the Rate or Suspension of After-Tax Contributions . A Participant’s after-tax contributions pursuant to Section 5.1(a) shall continue in effect at the rate elected by the Participant pursuant to Section 3.2 until the Participant changes or suspends such election. A Participant may change or suspend such election at such time and in such manner as may be prescribed by the Administrative Committee, provided that only the last change made by a Participant during a payroll period shall be effectuated. Such change or suspension shall be effective as of the first payroll period commencing after the date on which the change or suspension is received, or such later payroll period as may be administratively practicable. A Participant who has suspended after-tax contributions pursuant to this subsection may resume after-tax contributions by making an election at such time and in such manner as may be prescribed by the Administrative Committee.
     (c)  Performance Reward Plan Contribution Election . Subject to the limitations set forth in Article 6, a Participant may elect, in accordance with procedures

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prescribed by the Administrative Committee, to make an after-tax contribution of PRP Compensation, if any. The percentage of PRP Compensation so elected by a Participant pursuant to this Section 5.1(c), when aggregated with the percentage of PRP Compensation contributed to the Plan as a pre-tax contribution and/or designated Roth contribution pursuant to Section 4.1(c), shall be 0%, 50% or 100%.
     (d)  Form of Contributions . Subject to Section 7.2(b) with respect to contributions invested in the Harris Stock Fund, after-tax contributions shall be contributed to the Plan in cash.
     Section 5.2. Rollover Contributions . (a) Requirements for Rollover Contributions . If a Participant receives an “eligible rollover distribution” (within the meaning of section 402(c)(4) of the Code) from an Eligible Retirement Plan, then such Participant may contribute to the Plan an amount that does not exceed the amount of such eligible rollover distribution (including the proceeds from the sale of any property received as part of such eligible rollover distribution). Notwithstanding the foregoing, rollover contributions to the Plan may not include any portion of an eligible rollover distribution that consists of (i) after-tax employee contributions; (ii) designated Roth contributions described in section 402A of the Code or any related earnings with respect to such contributions or (iii) contributions to a Roth individual retirement account described in section 408A of the Code or any related earnings with respect to such contributions. A rollover contribution may be in the form of cash or, with the consent of the Administrative Committee or its delegate, a promissory note evidencing an outstanding loan balance.
     (b)  Delivery of Rollover Contributions . Any rollover contribution made pursuant to this Section shall be delivered by the Participant to the Trustee on or before the 60th

25


 
day after the day on which the Participant receives the distribution (or on or before such later date as may be prescribed by law) or shall be transferred to the Trustee on behalf of the Participant directly from the trust from which the eligible rollover distribution is made. Any such contribution must be accompanied by any information or documentation in connection therewith requested by the Administrative Committee or the Trustee. Notwithstanding the foregoing, the Administrative Committee shall not permit a rollover contribution if in its judgment accepting such contribution would cause the Plan to violate any provision of the Code or Regulations.
ARTICLE 6
LIMITATIONS ON CONTRIBUTIONS
     Section 6.1. Annual Limit on Pre-Tax Contributions and Designated Roth Contributions . (a) General Rule . Notwithstanding the provisions of Section 4.1, the aggregate of pre-tax contributions and designated Roth contributions made on behalf of a Participant for any calendar year pursuant to such Section and pursuant to any other plan or arrangement described in section 401(k) of the Code which is maintained by an Employer or Affiliate shall not exceed the dollar limitation in effect for such calendar year under section 402(g) of the Code, except to the extent permitted under Section 4.1(d) of the Plan and section 414(v) of the Code with respect to “catch-up contributions.”
     (b)  Excess Pre-Tax Contributions and Designated Roth Contributions .
     (1) Characterization as After-Tax Contributions . Except to the extent set forth in Section 4.1(d) of the Plan and section 414(v) of the Code with respect to “catch-up contributions,” if for any calendar year the pre-tax contributions and designated Roth contributions to the Plan or the aggregate of the pre-tax

26


 
contributions and the designated Roth contributions to the Plan plus amounts contributed under other plans or arrangements described in section 401(k), 403(b), 408(k) or 408(p) of the Code for a Participant reach the limit imposed by subsection (a) of this Section for such calendar year, any contributions under the Plan during the calendar year that exceed such limit (“excess deferrals”) shall be characterized as after-tax contributions. The Participant for whom any contributions are recharacterized as after-tax contributions pursuant to this paragraph shall designate the extent to which the contributions to be recharacterized shall be pre-tax contributions or designated Roth contributions (but only up to the extent that such types of contributions were made by the Participant to the Plan for the Plan Year) and, in the event that any such designation is not made or is incomplete, the Participant’s pre-tax contributions shall be recharacterized up to the extent pre-tax contributions were made to the Plan for the Plan Year and, to the extent that the Participant’s excess deferrals exceed such pre-tax contributions, the Participant’s designated Roth contributions made to the Plan for the Plan Year shall be recharacterized.
     (2) Distribution . Notwithstanding the foregoing, and except to the extent set forth in Section 4.1(d) of the Plan and section 414(v) of the Code with respect to “catch-up contributions,” if any excess deferrals of a Participant are not characterized as after-tax contributions, because of the limitation set forth in Section 5.1 on the amount of after-tax contributions that may be made to the Plan or otherwise, such Participant shall, pursuant to such rules and at such time following such calendar year as determined by the Administrative Committee, be

27


 
allowed to submit a written request that the excess deferrals, plus any income and minus any loss allocable thereto, be distributed to the Participant. The amount of any income or loss allocable to such excess deferrals shall be determined pursuant to Regulations. Such amount of excess deferrals, as adjusted for income or loss, shall be distributed to the Participant no later than April 15 following the calendar year for which such contributions were made. Notwithstanding the provisions of this subsection (b)(2), any such excess deferrals shall be treated as “annual additions” for purposes of Section 6.3 for the limitation year in which such contributions were made. The amount of excess deferrals that may be distributed under this subsection (b)(2) with respect to a Participant for a calendar year shall be reduced by any amounts previously distributed pursuant to Section 6.2(d)(1) with respect to such Participant for such year. The Participant to whom any excess deferrals are distributed pursuant to this paragraph shall designate the extent to which such distributed excess deferrals are treated as pre-tax contributions or designated Roth contributions (but only up to the extent that such types of contributions were made by the Participant to the Plan for the Plan Year) and, in the event that any such designation is not made or is incomplete, such distributed excess deferrals shall be treated as pre-tax contributions up to the extent pre-tax contributions were made to the Plan for the Plan Year and, to the extent that such distributed excess deferrals exceed such pre-tax contributions, such excess deferrals shall be treated as distributions of designated Roth contributions made to the Plan for the Plan Year.

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     Section 6.2. Limits on Contributions for Highly Compensated Employees .
     (a)  Actual Deferral Percentage Test Imposed by Section 401(k)(3) of the Code . Notwithstanding the provisions of Section 4.1, if the pre-tax contributions and designated Roth contributions made pursuant to Section 4.1 for a Plan Year fail, or in the judgment of the Administrative Committee are likely to fail, to satisfy both of the tests set forth in paragraphs (1) and (2) of this subsection, the adjustments prescribed in Section 6.2(d)(1) shall be made. Any pre-tax contributions or designated Roth contributions which are “catch-up contributions” described in Section 4.1(d) shall not be considered to be pre-tax contributions or designated Roth contributions for purposes of determining whether the tests set forth in paragraphs (1) and (2) of this subsection are satisfied or for purposes of making any adjustments prescribed by Section 6.2(d)(1).
     (1) The HCE average deferral percentage for such year does not exceed the product of the NHCE average deferral percentage for such year and 1.25.
     (2) The HCE average deferral percentage for such year (i) does not exceed the NHCE average deferral percentage for such year by more than two percentage points and (ii) does not exceed the product of the NHCE average deferral percentage for such year and 2.0.
     (b)  Actual Contribution Percentage Test Imposed by Section 401(m) of the Code . Notwithstanding the provisions of Sections 4.2 and 5.1, if the aggregate of the matching contributions made pursuant to Section 4.2 and the after-tax contributions made pursuant to Section 5.1 for a Plan Year fail, or in the judgment of the Administrative Committee are likely to fail, to satisfy both of the tests set forth in paragraphs (1) and (2) of this subsection, the adjustments prescribed in Section 6.2(d)(2) shall be made.

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     (1) The HCE average contribution percentage for such year does not exceed the product of the NHCE average contribution percentage for such year and 1.25.
     (2) The HCE average contribution percentage for such year (i) does not exceed the NHCE average contribution percentage for such year by more than two percentage points and (ii) does not exceed the product of the NHCE average contribution percentage for such year and 2.0.
     (c)  Definitions and Special Rules . For purposes of this Section, the following definitions and special rules shall apply:
     (1) The “actual deferral percentage test” refers collectively to the tests set forth in paragraphs (1) and (2) of subsection (a) of this Section relating to pre-tax contributions and designated Roth contributions. The actual deferral percentage test shall be satisfied if either of such tests are satisfied.
     (2) The “HCE average deferral percentage” for a Plan Year is a percentage determined for the group of Eligible Employees who are eligible to make pre-tax contributions or designated Roth contributions for the current Plan Year and who are Highly Compensated Employees for the current Plan Year. Such percentage shall be equal to the average of the ratios, calculated separately for each such Eligible Employee to the nearest one-hundredth of one percent, of the employer contributions for the benefit of such Eligible Employee for the current Plan Year (if any) to the total compensation for the current Plan Year paid to such Eligible Employee. For this purpose, “employer contributions” shall mean pre-tax contributions and designated Roth contributions (including excess

30


 
deferrals), but excluding any pre-tax contributions and designated Roth contributions that are taken into account under the actual contribution percentage test (provided that the actual deferral percentage test is satisfied both with and without exclusion of such contributions).
     (3) The “NHCE average deferral percentage” for a Plan Year is a percentage determined for the group of Eligible Employees who were eligible to make pre-tax contributions or designated Roth contributions for the immediately preceding Plan Year and who were not Highly Compensated Employees for the immediately preceding Plan Year. Such percentage shall be equal to the average of the ratios, calculated separately for each such Eligible Employee to the nearest one-hundredth of one percent, of the employer contributions for the benefit of such Eligible Employee for the immediately preceding Plan Year (if any) to the total compensation for the immediately preceding Plan Year paid to such Eligible Employee. For this purpose, “employer contributions” shall mean pre-tax contributions and designated Roth contributions (including excess deferrals), but excluding (i) excess deferrals that arise solely from pre-tax contributions and designated Roth contributions made under this Plan or other plans maintained by the Employers and Affiliates and (ii) any pre-tax contributions and designated Roth contributions that are taken into account under the actual contribution percentage test (provided that the actual deferral percentage test is satisfied both with and without exclusion of such pre-tax contributions and designated Roth contributions). Notwithstanding the foregoing, in the event of a “plan coverage change” during a Plan Year (as such term is defined in Treasury Regulation

31


 
§1.401(k)-2(c)(4)(iii)(A)), the “NHCE average deferral percentage” for such Plan Year shall be determined in accordance with Treasury Regulation §1.401(k)-2(c)(4).
     (4) The “actual contribution percentage test” refers collectively to the tests set forth in paragraphs (1) and (2) of subsection (b) of this Section relating to matching contributions and after-tax contributions. The actual contribution percentage test shall be satisfied if either of such tests are satisfied.
     (5) The “HCE average contribution percentage” for a Plan Year is a percentage determined for the group of Eligible Employees who are eligible to have matching contributions, after-tax contributions, or in the discretion of the Administrative Committee and to the extent permitted under rules prescribed by the Secretary of the Treasury or otherwise under the law, pre-tax contributions and designated Roth contributions, made for their benefit for the current Plan Year and who are Highly Compensated Employees for the current Plan Year. Such percentage shall be equal to the average of the ratios, calculated separately for each such Eligible Employee to the nearest one-hundredth of one percent, of the matching contributions, after-tax contributions and, in the discretion of the Administrative Committee and to the extent permitted under rules prescribed by the Secretary of the Treasury or otherwise under the law, pre-tax contributions and designated Roth contributions, made for the benefit of such Eligible Employee for the current Plan Year (if any) to the total compensation for the current Plan Year paid to such Eligible Employee.

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     (6) The “NHCE average contribution percentage” for a Plan Year is a percentage determined for the group of Eligible Employees who were eligible to have matching contributions, after-tax contributions, or in the discretion of the Administrative Committee and to the extent permitted under rules prescribed by the Secretary of the Treasury or otherwise under the law, pre-tax contributions and designated Roth contributions, made for their benefit for the immediately preceding Plan Year and who were not Highly Compensated Employees for the immediately preceding Plan Year. Such percentage shall be equal to the average of the ratios, calculated separately for each such Eligible Employee to the nearest one-hundredth of one percent, of the matching contributions, after-tax contributions and, in the discretion of the Administrative Committee and to the extent permitted under rules prescribed by the Secretary of the Treasury or otherwise under the law, pre-tax contributions and designated Roth contributions, made for the benefit of such Eligible Employee for the immediately preceding Plan Year (if any) to the total compensation for the immediately preceding Plan Year paid to such Eligible Employee. Notwithstanding the foregoing, in the event of a “plan coverage change” during a Plan Year (as such term is defined in Treasury Regulation §1.401(m)-2(c)(4)(iii)(A)), the “NHCE average contribution percentage” for such Plan Year shall be determined in accordance with Treasury Regulation §1.401(m)-2(c)(4).
     (7) The term “compensation” shall have the meaning set forth in section 414(s) of the Code or, in the discretion of the Administrative Committee, any other meaning in accordance with the Code for these purposes.

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     (8) If the Plan and one or more other plans of an Employer to which pre-tax contributions, designated Roth contributions, matching contributions or employee contributions (as such terms are defined for purposes of section 401(m) of the Code), or qualified non-elective contributions (as such term is defined in section 401(m)(4)(C) of the Code), are made are treated as one plan for purposes of section 410(b) of the Code, such plans shall be treated as one plan for purposes of this Section. If a Highly Compensated Employee participates in the Plan and one or more other plans of an Employer to which any such contributions are made, all such contributions shall be aggregated for purposes of this Section.
     (d)  Adjustments to Comply with Limits .
     (1) Adjustments to Comply with Actual Deferral Percentage Test . The Administrative Committee shall cause to be made such periodic computations as it shall deem necessary or appropriate to determine whether the actual deferral percentage test will be satisfied during a Plan Year, and, if it appears to the Administrative Committee that such test will not be satisfied, the Administrative Committee shall take such steps as it deems necessary or appropriate to adjust the pre-tax contributions and designated Roth contributions made pursuant to Section 4.1 for all or a portion of the remainder of such Plan Year for the benefit of some or all of the Highly Compensated Employees to the extent necessary in order for the actual deferral percentage test to be satisfied. If, after the end of the Plan Year, the Administrative Committee determines that, notwithstanding any adjustments made pursuant to the preceding sentence, the actual deferral percentage test was not satisfied, the Administrative Committee shall calculate a

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total amount by which pre-tax contributions and designated Roth contributions must be reduced in order to satisfy such test in the manner prescribed by section 401(k)(8)(B) of the Code (the “excess contributions amount”). The amount of pre-tax contributions and designated Roth contributions to be reduced for each Participant who is a Highly Compensated Employee shall be determined by first reducing the pre-tax contributions and designated Roth contributions of each Participant whose actual dollar amount of pre-tax contributions and designated Roth contributions for such Plan Year is highest until such reduced dollar amount equals the next highest actual dollar amount of pre-tax contributions and designated Roth contributions made for such Plan Year on behalf of any Highly Compensated Employee or until the total reduction equals the excess contributions amount. If further reductions are necessary, then the pre-tax contributions and designated Roth contributions on behalf of each Participant who is a Highly Compensated Employee and whose actual dollar amount of pre-tax contributions and designated Roth contributions for such Plan Year is the highest (determined after the reduction described in the preceding sentence) shall be reduced in accordance with the preceding sentence. Such reductions shall continue to be made to the extent necessary so that the total reduction equals the excess contributions amount. The portion of a Participant’s pre-tax contributions and designated Roth contributions to be reduced in accordance with this Section 6.2(d)(1) shall be recharacterized as an after-tax contribution, and the Participant shall be notified of such recharacterization and the tax consequences thereof no later than 2 1 / 2 months after the end of the Plan Year. The amount of a

35


 
Participant’s pre-tax contributions and designated Roth contributions to be reduced in accordance with this Section shall be reduced by any excess deferrals previously distributed to such Participant pursuant to Section 6.1 in order to comply with the limitations of section 402(g) of the Code. The amount of any income or loss allocable to any such reductions shall be determined pursuant to the applicable Regulations promulgated by the U.S. Treasury Department. The Participant for whom any contributions are recharacterized as after-tax contributions pursuant to this paragraph shall designate the extent to which the contributions to be recharacterized contributions shall be pre-tax contributions or designated Roth contributions (but only up to the extent that such types of contributions were made by the Participant to the Plan for the Plan Year) and, in the event that any such designation is not made or is incomplete, the Participant’s pre-tax contributions shall be recharacterized up to the extent pre-tax contributions were made to the Plan for the Plan Year and, to the extent that the Participant’s excess contributions exceed such pre-tax contributions, the Participant’s designated Roth contributions made to the Plan for the Plan Year shall be recharacterized.
     (2) Adjustments to Comply with Actual Contribution Percentage Test . The Administrative Committee shall cause to be made such periodic computations as it shall deem necessary or appropriate to determine whether the average contribution percentage test will be satisfied during a Plan Year, and, if it appears to the Administrative Committee that such test will not be satisfied, the Administrative Committee shall take such steps as it deems necessary or

36


 
appropriate to adjust the matching contributions and the after-tax contributions made pursuant to Section 4.2 and 5.1, respectively, for all or a portion of the remainder of such Plan Year on behalf of some or all of the Highly Compensated Employees to the extent necessary in order for the average contribution percentage test to be satisfied. If the Administrative Committee determines that, notwithstanding any adjustments made pursuant to the preceding sentence, the average contribution percentage test was or will not satisfied, the Administrative Committee shall, in its discretion, (1) allocate a qualified nonelective contribution pursuant to Section 6.2(e) or (2) reduce the matching contributions and after-tax contributions made on behalf of each Participant who is a Highly Compensated Employee and whose actual dollar amount of matching contributions and after-tax contributions for such Plan Year is the highest in the same manner described in subparagraph (1) of this paragraph to the extent necessary to comply with the average contribution percentage test. The reduction described in the preceding sentence shall be made first with respect to a Participant’s after-tax contributions in excess of six percent of Compensation, second with respect to any remaining after-tax contributions and any matching contributions attributable thereto, and third with respect to any other matching contributions. With respect to contributions to be so reduced, no later than 2 1 / 2 months after the end of the Plan Year (or if correction by such date is administratively impracticable, no later than the last day of the subsequent Plan Year), the Administrative Committee shall cause to be distributed to each such Participant the amount of such reductions made with respect to vested matching contributions to which such Participant

37


 
would be entitled under the Plan if such Participant had terminated service on the last day of the Plan Year for which such contributions are made (or on the date of the Participant’s actual termination of employment, if earlier) and with respect to after-tax contributions (plus any income and minus any loss allocable thereto), and any remaining amount of such reductions (plus any income and minus any loss allocable thereto) shall be forfeited. Any amounts forfeited pursuant to this paragraph shall be treated in the same manner as forfeitures described in Section 9.2(b). The amount of any such income or loss allocable to any such reduction to be so distributed or forfeited shall be determined pursuant to applicable Regulations promulgated by the U.S. Treasury Department.
     (e)  Qualified Nonelective Contributions . Subject to the limitations set forth in Sections 6.3 and 6.4, and to the extent permitted by Regulations or other pronouncements of the Internal Revenue Service, for purposes of satisfying the actual contribution percentage test set forth in Section 6.2(b), the E

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