J. ALEXANDER?S CORPORATION DEFERRED COMPENSATION PLAN

Exhibit 10.1

DEFERRED COMPENSATION PLAN

TABLE OF CONTENTS

ARTICLE 1 NAME AND PURPOSE			2
1.1 Name			2
1.2 Purpose			2
1.3 Plan for a Select Group			2
1.4 Not a Funded Plan			2
1.5 Section 409A			2
ARTICLE 2 DEFINITIONS			3
ARTICLE 3 ELIGIBILITY AND PARTICIPATION			11
3.1 Eligibility			11
3.2 Participation			11
3.3 Termination of Participation			11
ARTICLE 4 ELECTIONS AND CONTRIBUTIONS			12
4.1 Deferral Agreement			12
4.2 Types of Deferral Elections.			12
4.3 Election Irrevocable			13
4.4 Timing of Deferral Elections			13
4.5 Matching Amounts			15
4.6 Election of Form of Payment			17
4.7 Change in Election of Form of Payment			17
ARTICLE 5 VESTING			18
5.1 Vesting of Participant Deferral Amounts			18
ARTICLE 6 ACCOUNTS AND CREDITS			19
6.1 Establishment of Deferral Account			19
6.2 Crediting of Deferral Amounts			19
6.3 Adjustment of Deferral Account			19
6.4 Measurement Funds			20
6.5 Forfeiture			20
ARTICLE 7 BENEFIT DISTRIBUTIONS			21
7.1 Normal Form of Benefits			21
7.2 Amount of Benefits			21
7.3 Benefit Payment Events			21
7.4 Time of Payment			21
7.5 Unforeseeable Emergency			22
7.6 Required Delay in Payment to Key Employees			22
7.7 Permissible Delays in Payment			23
7.8 Permitted Acceleration of Payment			23
ARTICLE 8 BENEFICIARIES			25
8.1 Automatic Beneficiary			25
8.2 Designated Beneficiary or Beneficiaries			25
8.3 Death			25
ARTICLE 9 RIGHTS OF PARTICIPANTS AND BENEFICIARIES			26
9.1 Creditor Status of Participant and Beneficiary			26
9.2 Rights with Respect to a Trust			26
9.3 Investments			26

ARTICLE 10 TRUST			27
10.1 Possible Establishment of Trust			27
10.2 Grantor Trust			27
10.3 Obligations of the Company			27
10.4 Trust Terms			27
10.5 Investment of Trust Funds			27
ARTICLE 11 ADMINISTRATION			28
11.1 Appointment of Administrator			28
11.2 Powers and Duties of the Administrator			28
11.3 Engagement of Advisors			28
11.4 Payment of Costs and Expenses			28
ARTICLE 12			30
CLAIMS PROCEDURE			30
12.1 Claim for Benefits			30
12.2 Denial of a Claim			30
12.3 Request for Review of a Denial of a Claim for Benefits			30
12.4 Appeals Procedure			30
12.5 Decision upon Review of Denial of Claim for Benefits			31
12.6 Establishment of Appeals Committee			32
ARTICLE 13 AMENDMENT AND TERMINATION			33
13.1 Power to Amend			33
13.2 Power to Terminate			33
13.3 No Liability for Plan Amendment or Termination			34
ARTICLE 14 MISCELLANEOUS			35
14.1 Non-Alienation			35
14.2 Tax Withholding			35
14.3 Incapacity			35
14.4 Administrative Forms			35
14.5 Independence of Plan			35
14.6 No Employment Rights Created			35
14.7 Responsibility for Legal Effect			35
14.8 Company’s Liability			36
14.9 Limitation of Duties			36
14.10 Limitation of Company’s Liability			36
14.11 Successors			36
14.12 Controlling Law			36
14.13 Notice			36
14.14 Headings and Titles			36
14.15 General Rules of Construction			36
14.16 Severability			37
14.17 Indemnification			37

DEFERRED COMPENSATION PLAN

     The J. Alexander’s Corporation Deferred Compensation Plan (“the Plan”) is hereby adopted by J. Alexander’s Corporation, a corporation organized and existing under and by virtue of the laws of the State of Tennessee (the “Company”);

     WHEREAS, the Company, in order to retain and reward a select group of management and/or highly compensated employees (hereinafter referred to as “Eligible Employee(s)”), desires to provide Eligible Employees with the opportunity to obtain additional retirement benefits through the Plan;

     NOW, THEREFORE, the Company hereby adopts the Plan, effective June 23, 2008, as follows:

ARTICLE 1
NAME AND PURPOSE

1.1		Name . The name of the Plan shall be the J. Alexander’s Corporation Deferred Compensation Plan.
1.2		Purpose . The purpose of the Plan is to retain and reward certain management and highly compensated employees of the Company who have contributed to the Company’s success and are expected to continue to contribute to such success in the future.
1.3		Plan for a Select Group . The Plan shall cover certain Employees of the Company who are members of a “select group of management or highly compensated employees” within the meaning of ERISA Sections 201(2), 301(a)(3) and 401(a)(1). The Company shall have the authority to take any and all actions necessary or desirable in order for the Plan to satisfy the requirements set forth in ERISA and the regulations thereunder applicable to plans maintained for Employees who are members of a select group of management or highly compensated employees.
1.4		Not a Funded Plan . It is the intention and purpose of the Company that the Plan shall be deemed to be “unfunded” for tax purposes and deemed a plan as would properly be described as “unfunded” for purposes of Title I of ERISA. The Plan shall be administered in such a manner, notwithstanding any contrary provision of the Plan, in order that it will be so deemed and would be so described.
1.5		Section 409A . The Plan is intended to conform with the requirements of Section 409A of the Code and the final regulations issued thereunder and shall be implemented and administered in a manner consistent therewith.

ARTICLE 2
DEFINITIONS

     Unless the context otherwise indicates, the following words used herein shall have the following meanings wherever used in this instrument:

2.1		Administrator . The word “Administrator” shall mean the committee composed of the Chief Financial Officer, the Vice President/Controller and the Vice President of Human Resources of the Company and any other person(s) designated by the Chief Executive Officer (the “CEO”) from time to time, in his sole discretion, or such other person(s) or entity appointed by the Board pursuant to Article 11.
2.2		Affiliated Company . Any corporation which is a member of a controlled group of corporations of which the Company is a member, or any unincorporated trade or business which is under the common control of or with the Company, or any affiliated service group of which the Company is a member, which are required to be aggregated with the Company under section 414(b) or 414(c) of the Code, without substitution of a lower percentage for 80% in applying section 1563(a)(1), (2) and (3) of the Code as permitted in section 1.409A-1(h)(3) of the Regulations.
2.3		Alternate Payee . The words “Alternate Payee” shall mean any spouse, former spouse, child or other dependent of a Participant who is recognized by a Domestic Relations Order as having a right to receive all, or a portion of , the benefits payable under this Plan to that Participant.
2.4		Appeals Committee . The words “Appeals Committee” shall mean the Compensation Committee or such other committee established by the Board pursuant to Article 12.
2.5		Base Salary . The words “Base Salary” shall mean a Participant’s base remuneration for services rendered to the Company as an Employee and while a Participant. A Participant’s Base Salary will not be reduced by amounts which the Participant has elected to defer pursuant to Article 4 of this Plan or by the amount of the Participant’s elective deferrals or salary reduction in the 401(k) Plan or any cafeteria plan (i.e., amounts excluded from taxable income under sections 125, 402(e)(3) and 402(h) of the Code). Furthermore, Base Salary shall not include any bonus amounts, reimbursements or other expense allowances, fringe benefits (cash and noncash), moving expenses, deferred compensation, welfare benefits or matching or employer contributions under any employee benefit plan of the Company.
2.6		Beneficiary . The word “Beneficiary” shall mean the person, trust, estate or other entity who or which is designated pursuant to Article 8 to receive Benefit Payments upon the death of a Participant.
2.7		Benefit Payment . The words “Benefit Payment” shall mean payment of the benefit as set forth in Article 7, Section 8.3 or Section 13.2.
2.8		Benefit Payment Commencement Date . The words “Benefit Payment Commencement Date” shall mean the earliest date on which a Benefit Payment for a particular Benefit Payment Event may be distributed (or commence to be distributed, if payable in

installments) under the terms of this Plan. In general, the Benefit Payment Commencement Date shall be the date that the Benefit Payment Event occurs.

2.9		Benefit Payment Event . The words “Benefit Payment Event” shall mean the occurrence of an event entitling a Participant to receive a payment of his or her benefits and which event is identified as a Benefit Payment Event under the terms of this Plan. The Plan may provide for payments on account of events which are not included in the Term “Benefit Payment Event” (e.g., Unforeseeable Emergency, Plan termination (including termination following a Change in Control) and as otherwise allowed by the Regulations under Section 409A).
2.10		Board . The word “Board” shall mean the Board of Directors of the Company.
		Bonus . The word “Bonus” shall mean a Participant’s cash bonus and incentive payments for services rendered to the Company as an Employee and while a Participant. A Participant’s Bonus will not be reduced by amounts which the Participant has elected to defer pursuant to Article 4 of this Plan or by the amount of the Participant’s elective deferrals or salary reduction in the 401(k) Plan or any cafeteria plan (i.e., amounts excluded from taxable income under sections 125, 402(e)(3) and 402(h) of the Code).
2.11		Change in Control . A “Change in Control” shall be deemed to have occurred upon the first to occur of any of the following events:

	(a)		Any one person or group (as described in Regulations promulgated under Section 409A) acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes more than fifty percent (50%) of the total fair market value or total voting power of the stock of the Company; or
	(b)		Notwithstanding that the Company has not undergone a Change in Control as described in 2.11(a), a Change in Control of the Company occurs on the date that either:

	(i)		Any one person or more than one person acting as a group (as described in Regulations promulgated under Section 409A), acquires or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons ownership of stock of the Company possessing thirty percent (30%) or more of the total voting power of the stock of such corporation; or
	(ii)		A majority of members of the Company’s Board is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s Board prior to the date of the appointment or election; or

(c)

Any one person or group (as described in Regulations promulgated under Section 409A) acquires or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons assets from the Company that have a total gross fair market value equal to or more than forty percent (40%) of all the assets of the Company immediately prior to such acquisition or

acquisitions. For this purpose, gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.

In determining whether a Change in Control has occurred, the following rules shall be applicable:

	(I)		For purposes of a change in ownership described in clause (a) above, if any one person or more than one person acting as a proxy is considered to own more than fifty percent (50%) of the total fair market value or total voting power of the stock of a corporation, the acquisition of additional stock by the same person or persons is not considered to cause a change in the ownership of the corporation (or to cause a change in the effective control of the corporation as described in clause (b)). An increase in the percentage of stock owned by any one person, or persons acting as a group, as a result of a transaction in which the corporation acquires its stock in exchange for property will be treated as an acquisition of stock. Section 2.11(a) applies only when there is a transfer of stock of a corporation (or issuance of stock of a corporation) and stock in such corporation remains outstanding after the transaction. For purposes of Section 2.11(a), persons will not be considered to be acting as a group solely because they purchase or own stock of the same corporation at the same time or as a result of a public offering. Persons will, however, be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the corporation. If a person, including an entity, owns stock in both corporations that enter into a merger, consolidation, purchase or acquisition of stock, or similar transaction, such shareholder is considered to be acting as a group with other shareholders only with respect to the ownership in that corporation prior to the transaction giving rise to the change and not with respect to the ownership interest in the other corporation.
	(II)		For purposes of a change in effective control of a corporation described in clause (b) above, if one person, or more than one person acting as a group, is considered to effectively control a corporation within the meaning of clause (b), the acquisition of additional control of the corporation by the same person or persons is not considered to cause a change in the effective control of the corporation within the meaning of clause (b) or to cause a change in the ownership of the corporation within the meaning of clause (a). Persons will or will not be considered to be acting as a group in accordance with rules similar to those set forth in clause (I) and as specifically provided in section 1.409A-3(i)(5)(vi)(D) of the Regulations under Section 409A.
	(III)		For purposes of a change in the ownership of a substantial portion of a corporation’s assets described in clause (c) above, there is not a Change in Control event when there is a transfer to an entity that is controlled by the shareholders of the transferring corporation immediately after the transfer. A transfer of assets by a corporation is not treated as a change in ownership of such assets if the assets are transferred to (i) a shareholder of the corporation (immediately before the asset transfer) in exchange for or with respect to its stock,

(ii) an entity, fifty percent (50%) or more of the total value or voting power of which is owned, directly or indirectly, by the corporation, (iii) a person, or more than one person acting as a group, that owns, directly or indirectly, fifty percent (50%) or more of the total value or voting power of all the outstanding stock of the corporation, or (iv) an entity, at least fifty (50%) of the total value or voting power of which is owned, directly or indirectly, by a person described in immediately preceding clause (iii). For purposes of the foregoing, and except as otherwise provided, a person’s status is determined immediately after the transfer of assets. Persons will or will not be considered to be acting as a group in accordance with rules similar to those set forth in clause (I), and as specifically provided in section 1.409A-3(i)(5)(vii)(C) of the Regulations under Section 409A.

	(IV)		Code Section 318(a) applies for purposes of determining stock ownership. Stock underlying a vested option is considered owned by the individual who owns the vested option (and the stock underlying an unvested option is not considered owned by the individual who holds the unvested option). If, however, a vested option is exercisable for stock that is not substantially vested (as defined by Regulation section 1.83-3(b) and (j)) the stock underlying the option is not treated as owned by the individual who holds the option.
	(V)		Whether a Change in Control has occurred will be determined by the Company in accordance with the rules and definitions set forth in this Section 2.11. This determination shall be made in a manner consistent with section 409A of the Code and the Regulations thereunder.

2.12		Code . The word “Code” shall mean the Internal Revenue Code of 1986, as amended. Whenever a reference is made herein to a specific Code section, such reference shall be deemed to include any successor Code section having the same or a substantially similar purpose.
2.13		Company . The word “Company” shall mean J. Alexander’s Corporation and any successor corporation or business organization which shall assume the duties and obligations of J. Alexander’s Corporation, under the Plan.
2.14		Compensation . The word “Compensation” shall have the same meaning as “Compensation” under the terms of the 401(k) Plan, subject to the maximum dollar limitation prescribed by section 401(a)(17) of the Code ($230,000 in 2008).
2.15		Compensation Committee . The words “Compensation Committee” shall mean the Compensation Committee of the Board.
2.16		Deferral Agreement . The words “Deferral Agreement” shall mean the agreement containing the election by an Eligible Employee to defer his Compensation pursuant to Section 4.1.
2.17		Deferral Account . The words “Deferral Account” shall mean a bookkeeping account maintained by the Administrator on behalf of each Participant to which credits and debits are made as provided in Article 6.

2.18		Deferral Amount . The words “Deferral Amount” shall mean for each Participant an amount equal to the amount by which the Participant’s Base Salary and/or Bonus are reduced by means of a deferral election pursuant to Section 4.1 herein.
2.19		Director . The word “Director” shall mean a member of the Board of Directors of the Company.
2.20		Disability . The word “Disability” shall have the following meaning: A Participant shall be considered disabled if the Participant:

	(a)		Is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months;
	(b)		Is, by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health plan covering employees of the Company; or
	(c)		Is determined to be totally disabled by the Social Security Administration.

The determination of whether a Disability exists shall be made by the Administrator.

2.21		Domestic Relations Order . The words “Domestic Relations Order” shall mean a judgment, decree or order (including approval of a property settlement agreement) which is made pursuant to a state domestic relations law, which relates to the provision of child support, alimony payments or marital property rights to a spouse, child or other dependent of a Participant (“Alternate Payee”), and which creates or recognizes the existence of an Alternate Payee’s right to, or assigns to an Alternate Payee the right to, receive all or a portion of the benefits payable to a Participant.
2.22		Effective Date . The words “Effective Date” shall mean the date the Plan becomes effective, which is June 23, 2008.
2.23		Eligible Employee . The words “Eligible Employee” shall mean an Employee of the Company or Affiliated Company who satisfies the eligibility requirements of Section 3.1.
2.24		Employee . The word “Employee” shall mean any common-law employee of the Company or of any Affiliated Company, whether or not a Board member, but excluding any person serving only in the capacity of Board member of the Company or any Affiliated Company. Notwithstanding the foregoing, the Compensation Committee may, in its discretion, exclude employees of any Affiliated Company from eligibility to participate in the Plan; and the Compensation Committee may, in its discretion, make employees of any subsidiary that is not an Affiliated Company eligible to participate in the Plan.

2.25		ERISA . The acronym “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended. Whenever a reference is made herein to a specific ERISA section, such reference shall be deemed to include any successor ERISA section having the same or a substantially similar purpose.
2.26		4 01(k) Plan . The words “401(k) Plan” shall mean the J. Alexander’s Corporation Savings Incentive and Salary Deferral Plan, as it may be amended.
2.27		4 01(k) Matching Refund Amount . The words “401(k) Matching Refund Amount” shall mean, for a Participant who makes elective deferrals under the 401(k) Plan and receives an allocation of matching contributions under the 401(k) Plan, the refund (if any) attributable to the amount of such matching contributions (not including earnings) allocated to that Participant for a particular plan year of the 401(k) Plan that are determined under the terms of the 401(k) Plan to be in excess of the limitations resulting from the application of the actual contribution percentage test pursuant to section 1.401(m)-2(a) of the Regulations, which amount (less any portion forfeited because the Participant is not fully vested) is refunded to the Participant after the last day of such plan year.
2.28		Identification Date . The words “Identification Date” shall mean the date determined by the Administrator in accordance with section 1.409A-1(i)(3) of the Regulations which is the last day of the 12-month period for determination of Key Employees. Unless otherwise designated, the Identification Date shall be December 31.
2.29		Key Employee . The words “Key Employee” shall mean a “key employee” of the Company as described in section 416(i)(1)(A)(i), (ii) or (iii) of the Code (without regard to section 416(i)(5) of the Code) (generally, an officer having annual compensation of more than $150,000 (in 2008), as adjusted; a 5% owner; or a 1% owner having annual compensation of more than $150,000), determined at any time during the 12-month period ending on the Identification Date. A Participant who is a Key Employee on an Identification Date shall be treated as a Key Employee for the twelve month period beginning on January 1 (or such other date designated in accordance with Section 7.6) immediately following such Identification Date. For purposes hereof, the term “officer” shall be determined on the basis of all facts, including the source of his authority, the term for which elected or appointed, and the nature and extent of his duties. Generally, the term “officer” means an administrative executive who is in regular and continued service. An Employee who merely has the title of an officer, but not the authority of an officer, is not to be considered an officer hereunder. Similarly, an Employee who does not have the title of an officer but has the authority of an officer is an officer for this purpose. Furthermore, for purposes hereof, during any 12-month period following an Identification Date, no more than fifty (50) employees of all members of the controlled group consisting of the Company and all Affiliated Companies, or if less, the greater of three (3) individuals or ten percent (10%) of such employees of all members of such controlled group, shall be treated as officers hereunder.
2.30		Matching Amount . The words “Matching Amount” shall mean an annual amount to be credited to a Participant’s Deferral Account by the Company pursuant to Section 4.5.

2.31		Measurement Funds . The words “Measurement Funds” shall mean hypothetical investments the Participant may elect to value his or her Deferral Account balances.
2.32		Participant . The word “Participant” shall mean an Eligible Employee who participates in the Plan by making a deferral election in a Deferral Agreement.
2.33		Participation Commencement Date for Bonus and/or Base Salary . The words “Participation Commencement Date for Bonus” shall mean, for each Participant, the date that his or her Deferral Agreement first becomes effective for deferral of Bonus as provided in Section 4.4(f). The words “Participation Commencement Date for Base Salary” shall mean, for each Participant, the date that his or her Deferral Agreement first becomes effective for deferral of Base Salary as provided in Section 4.4(f).
2.34		Plan . The word “Plan” shall mean the J. Alexander’s Corporation Deferred Compensation Plan as set forth herein, effective as of the Effective Date, and as it may be later amended.
2.35		Plan Year . The words “Plan Year” shall mean the twelve- (12) month period ending on December 31 in each calendar year, except that the initial Plan Year shall be the short period commencing on June 23, 2008 and ending on December 31, 2008.
2.36		Regulations . The word “Regulations” shall mean the regulations promulgated by the Treasury Department under the Code.
2.37		Section 409A . The words “Section 409A” shall mean section 409A of the Code, related Regulations and guidance thereunder, including such Regulations and guidance promulgated after the Effective Date of the Plan.
2.38		Separation from Service . The words “Separation from Service” shall mean for any Participant the occurrence of any one of the following events:

(a) The Participant is discharged by the Company;

(b) The Participant voluntarily terminates employment with the Company; or

(c) The Participant dies while employed with the Company.

For purposes of determining whether a Separation from Service has occurred, the term “Company” shall include any “Affiliated Company”, and no Separation from Service shall be deemed to have occurred if the Participant remains employed by any Affiliated Company.

A Separation from Service does not occur if the Participant is on military leave, sick leave or other bona fide leave of absence if the period of leave does not exceed six months or such longer period during which the Participant’s right to reemployment is provided by statute or contract. If the period of leave exceeds six months and the Participant’s right to reemployment is not provided either by statute or contract, a Separation from Service will be deemed to have occurred on the first day following the six-month period. If the period of leave 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 the impairment causes the Participant to be unable to perform the duties of his or her position of employment or any substantially similar position of employment, a 29 month period of absence may be substituted for the six month period.

Whether a termination of employment has occurred is based on whether the facts and circumstances indicate that the Company and the Participant reasonably anticipated that no further services would be performed after a certain date or that the level of bona fide services the Participant would perform after such date (whether as an employee or as an independent contractor) would permanently decrease to no more than 20 percent of the average level of bona fide services performed (whether as an employee or an independent contractor) over the immediately preceding 36 month period (or the full period of services to the Company if the employee has been providing services to the Company for less than 36 months).

If a Participant provides services both as an Employee and as a member of the Board, the services provided as a director are not taken into account in determining whether the Participant has incurred a Separation from Service as an Employee for purposes of this Plan, unless this Plan is aggregated under Section 409A with any plan in which the Participant participates as a director.

All determinations of whether a Separation from Service has occurred will be made in a manner consistent with Section 409A and the Regulations thereunder.

2.39		Unforeseeable Emergency . The term “Unforeseeable Emergency” shall mean a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Beneficiary, the Participant’s spouse, or a dependent of the Participant; loss of the Participant’s property due to casualty (including the need to rebuild a home not otherwise covered by insurance); or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant. The purchase of a home and the payment of college tuition are not normally Unforeseeable Emergencies.
2.40		USERRA . The acronym “USERRA” shall mean the Uniformed Services Employment and Reemployment Rights Act of 1994, as amended.
2.41		Valuation Date . The words “Valuation Date” shall mean the dates on which Deferral Amounts, Matching Amounts, Benefit Payments and investment earnings or losses are credited or debited to the Deferral Accounts. Unless otherwise designated in writing by the Administrator, the Valuation Dates shall be March 31, June 30, September 30 and December 31 of each year. The authority of the Administrator to change the Valuation Dates shall include the authority to designate an interim Valuation Date at any time.

ARTICLE 3
ELIGIBILITY AND PARTICIPATION

3.1		Eligibility . Employees who are classified in any of the following categories: (i) officers of the Company or of any Affiliated Company (except for any Affiliated Company whose employees are excluded by the Compensation Committee), (ii) corporate and regional directors, (iii) corporate managers and (iv) head coaches (i.e., general managers) shall be eligible to participate, commencing on the Participation Commencement Date specified by Section 4.4(f). An Eligible Employee who is transferred during a particular Plan Year to a position other than the categories listed in the preceding sentence shall nonetheless remain an Eligible Employee for the remainder of that Plan Year so long as the Eligible Employee remains an employee of the Company (or any Affiliated Company) for the remainder of such Plan Year. The Compensation Committee may, at any time and in its discretion, add to, subtract or otherwise change the categories of employees who are eligible to participate.
3.2		Participation . Each Eligible Employee who makes a deferral election in a Deferral Agreement shall become a Participant on the Participation Commencement Date.
3.3		Termination of Participation . Participation shall cease upon the payment to the Participant of the remaining balance in his or her Deferral Account.

ARTICLE 4
ELECTIONS AND CONTRIBUTIONS

4.1		Deferral Agreement . Each Eligible Employee may elect to defer his or her Compensation by executing, in writing, a Deferral Agreement in accordance with rules and procedures established by the Administrator and the provisions of this Article 4. If an Eligible Employee makes a deferral election hereunder for a Plan Year, then a portion of the Base Salary and/or Bonus which would otherwise be paid to the Participant by the Company shall be retained by the Company and, in lieu thereof, an amount equal to the amount deferred shall constitute a Deferral Amount hereunder and shall be credited to the Participant’s Deferral Account pursuant to Article 6.
		If a Participant ceases to be an Eligible Employee, the Deferral Agreement for that Participant shall be cancelled (but not prior to the time when such Participant ceases to be an Eligible Employee pursuant to Section 3.1) and that Participant shall not be eligible to enter into another Deferral Agreement unless he or she again becomes an Eligible Employee.
		A Participant’s election under a Deferral Agreement shall remain in effect until terminated or modified by the Participant; provided, however, that such election shall become irrevocable as of each December 31 with respect to Base Salary that is paid in connection with services performed in the immediately following Plan Year and such election shall become irrevocable as of the last day of the Company’s fiscal year with respect to a Bonus that is paid in connection with services performed in the immediately following fiscal year. Notwithstanding the foregoing, for a Bonus that is treated as “performance based compensation” described in Section 4.4(b), the Deferral Agreement as to such Bonus may be revoked no later than the date which is six months prior to the end of the performance period during which the Bonus is earned. Any modification or termination of a Deferral Agreement by a Participant must be in a form prescribed by the Administrator and within any period or before any deadline date that may be established by the Administrator pursuant to Section 4.4(d).
		For purposes of determining whether amounts are paid with respect to services performed in a particular year, compensation paid on or after January 1 solely for services performed during the final payroll period described in section 3401(b) of the Code containing the immediately preceding December 31 shall be treated as compensation for services performed in the year when payment is made.

4.2

Types of Deferral Elections . Each Participant may make separate elections in one or more Deferral Agreements as to the following:

	(a)		Base Salary Deferral . With respect to each Plan Year, a Participant may elect to defer a portion of Base Salary by making a deferral election in writing as required by the Administrator. A Participant’s deferral election shall specify a stated percentage or dollar amount of the Participant’s Base Salary, which specified percentage or dollar amount shall not be less than one percent (1%) nor exceed twenty-five percent (25%) of the Participant’s Base Salary. The amount so elected under the deferral election shall be credited to the Participant’s Deferral Account at the times specified in Article 6.
	(b)		Bonus Deferral . A Participant may elect to defer all or a portion of his or her potential Bonus by making a deferral election in writing as required by the Administrator. A Participant’s deferral election shall specify a stated percentage or dollar amount of the Participant’s Bonus, which specified percentage or dollar amount shall not be less than one percent (1%) nor exceed twenty-five percent (25%) of the Participant’s Bonus. The amount so elected under the deferral election shall be credited to the Participant’s Deferral Account under the Plan at the time specified in Article 6.

All elections to make deferrals under the Plan, and all resulting deferrals, shall be subject to such rules, procedures, limits and restrictions as the Administrator may establish from time to time. No election in violation of Section 409A will be effective.

4.3		Election Irrevocable . A Participant’s deferral election shall be irrevocable for the entire Plan Year or other period for which it is made (except as provided in Section 7.5 following a distribution due to an Unforeseeable Emergency and as provided in Section 4.4(h) following a determination of Disability).
4.4		Timing of Deferral Elections . The following rules govern the timing of all deferral elections under the Plan:

	(a)		Base Salary Deferral . A Participant must complete a Deferral Agreement for Base Salary making the deferral election described in Section 4.2(a) no later than the last day of the Plan Year immediately preceding the Plan Year during which the services will be performed that result in the payment of Base Salary which is deferred (or such earlier date as may be designated by the Administrator as provided in Section 4.4(d)).
	(b)		Bonus Deferral . If a bonus is paid for services rendered entirely within a particular fiscal year of the Company (i.e., qualifies as “fiscal year compensation” within the meaning of section 1.409A-2(a)(6) of the Regulations), then a Participant must complete a Deferral Agreement for Bonus making the deferral election described in Section 4.2(b) no later than the last day of the Company’s fiscal year immediately preceding the fiscal year in which the services are performed for which such Bonus is payable. Notwithstanding the foregoing, if the Bonus can be treated as “performance based compensation” as described in section 409(a)(4)(B)(iii) of the Code, attributable to a performance period of at least twelve (12) consecutive months, the Deferral Agreement may be completed no later than the date which is six months prior to the end of the performance

period during which the Bonus is earned. In each of the above cases, the Administrator may establish an earlier deadline as provided in Section 4.4(d).

(c)

Deferral Elections for Initial Plan Year . Su