Common use of Safe Harbor Rules Clause in Contracts

Safe Harbor Rules. The ManagementCo Shareholder is authorized and directed to elect to have the “Safe Harbor” described in the proposed Revenue Procedure set forth in Internal Revenue Service Notice 2005-43 (the “Notice”) apply to any interest in the Company transferred to a service provider by the Company on or after the effective date of such Revenue Procedure in connection with services provided to the Company. Under the Safe Harbor, the value of an interest that is transferred in connection with the performance of services (a “Safe Harbor Interest”) is treated as being equal to the liquidation value of that interest. For purposes of making such Safe Harbor election, the ManagementCo Shareholder is designated as the “partner who has responsibility for federal income tax reporting” by the ManagementCo Shareholder and, accordingly, execution of such Safe Harbor election by the ManagementCo Shareholder constitutes execution of a “Safe Harbor Election” in accordance with Section 3.03(1) of the Notice. The Company and each Shareholder agree to comply with all requirements of the Safe Harbor described in the Notice, including, without limitation, the requirement that each Shareholder prepare and file all federal income tax returns (to the extent it is required to file such returns) reporting the income tax effects of each Safe Harbor Interest issued by the Company in a manner consistent with the requirements of the Notice. Each Shareholder’s obligations to comply with the requirements of this Section 12.14 shall survive the Shareholder’s ceasing to be a Shareholder of the Company and/or the winding up and/or termination of the Company, and for purposes of this Section 12.14, the Company shall be treated as continuing in existence. The ManagementCo Shareholder is authorized to amend the provisions in this Agreement to the extent necessary to achieve substantially the same tax treatment with respect to any interest in the Company transferred to a service provider by the Company in connection with services provided to the Company as set forth in Section 4 of the Notice (e.g., to reflect changes from the rules set forth in the Notice in subsequent Internal Revenue Service guidance), provided that such amendment is not adverse to any Shareholder (as compared with the after-tax consequences that would result if the provisions of the Notice applied to all interests in the Company transferred to a service provider by the Company in connection with services provided to the Company).

Safe Harbor Rules. A. ADP Test Safe Harbor - The ManagementCo Shareholder Plan will satisfy the ADP Test Safe Harbor for a Plan Year if (x) the Employer has elected in the Adoption Agreement to make Safe Harbor Matching Contributions or Safe Harbor Nonelective Contributions, (y) the Employer actually makes such contributions to the Plan for such year, in such amounts, and on behalf of such Participants, as are indicated in the Adoption Agreement and (z) the following requirements are met for such year: 1. The Employer furnishes, for such Plan Year, a written notice to each Participant who is authorized eligible to make Elective Deferrals for such year, stating his or her rights and directed obligations under the Plan. At a minimum, this notice shall describe: (a) The formula selected in the Adoption Agreement for providing either Safe Harbor Matching Contributions or Safe Harbor Nonelective Contributions; (b) The Elective Deferrals and any other contributions that may be made under the Plan; (c) The type and amount of compensation which may be deferred under the Plan; (d) How and when to elect make, change or revoke Elective Deferral elections, including a description of the period available to have make, change or revoke such elections under paragraph (3) below; and (e) The withdrawal and vesting provisions which apply to the “Safe Harbor” contributions made under the Plan. For a Plan Year that begins before January 1, 2000, the notice will not fail to satisfy the foregoing content requirement merely because it fails to include all of listed items, provided that the notice satisfies a reasonable good faith interpretation of the notice requirements of Section 401(k)(12) and 401(m)(10) of the Code. Further, notwithstanding the above, the notice for any Plan Year may provide the information described in subparagraph (b) (other than as to Elective Deferrals), (c) and (e) above by reference to the proposed Revenue Procedure set relevant portions of a summary plan description for the Plan that has been provided (or concurrently is provided) to the Participants, instead of by setting forth in Internal Revenue Service Notice 2005-43 (the “Notice”) apply to any interest such information in the Company transferred text of notice itself. However, such notice must describe the Safe Harbor Matching Contribution formula or Safe Harbor Nonelective Contribution formula used under the Plan, and state that the contributions made under said formula (as well as Elective Deferrals) are fully vested when made to the Plan. In addition, such notice must provide information which will help a service provider by Participant obtain additional information about the Company Plan (including an additional copy of the summary plan description). 2. The notice described in paragraph (1) must be so furnished within a reasonable period before the beginning of such Plan Year, or, in the case of a Participant who first becomes eligible to make Elective Deferrals on any date during such year, within a reasonable period before such date. This requirement is deemed to be satisfied if the notice is furnished at least 30 days, and no more than 90 days, before the beginning of such Plan Year, or, in the case of a Participant who first becomes eligible to make Elective Deferrals after the 90th day before the beginning of such Plan Year, no later than, and no more than 90 days before, the day on which the Participant first becomes so eligible. Notwithstanding the foregoing, for a Plan Year that begins before April 1, 1999, the notice need not be provided until March 1, 1999. In addition, if the first Plan Year during which the Employer will apply the Safe Harbor Rules is the Plan Year which begins on or after January 1, 2000, and on or before June 1, 2000, the effective date notice need not be given to any Participant on or before May 1, 2000. In lieu of such Revenue Procedure furnishing the notice in connection written paper form, the Employer may furnish the notice through an electronic medium, in accordance with services provided the applicable Treasury regulations and IRS rulings, notices and announcements. 3. Notwithstanding ,any election made in the Adoption Agreement, or any other provision of the Plan to the Companycontrary, a Participant may make, change or revoke an Elective Deferral election at any time during any reasonable period, established by the Plan Administrator, immediately after the Participant receives the notice described in paragraph (1). Under For the Safe Harborpurpose of the preceding sentence, the value of an interest that is transferred in connection with the performance of services (a “Safe Harbor Interest”) is treated as being equal 30-day period shall be deemed to the liquidation value of that interestbe a reasonable period. 4. For purposes of making such Safe Harbor electionthis subsection (A), the ManagementCo Shareholder is designated as the “partner who has responsibility for federal income tax reporting” by the ManagementCo Shareholder and, accordingly, execution of such Safe Harbor election by the ManagementCo Shareholder constitutes execution of a “Safe Harbor Election” in accordance with Section 3.03(1) of the Notice. The Company and each Shareholder agree to comply with all requirements of the Safe Harbor described in the Notice, including, without limitation, the requirement that each Shareholder prepare and file all federal income tax returns (to the extent it is required to file such returns) reporting the income tax effects of each Safe Harbor Interest issued by the Company in a manner consistent with the requirements of the Notice. Each Shareholder’s obligations to comply with the requirements of this Section 12.14 shall survive the Shareholder’s ceasing to be a Shareholder of the Company and/or the winding up and/or termination of the Company, and for purposes of this Section 12.14, the Company Participant shall be treated as continuing eligible to make Elective Deferrals for a Plan Year, if he or she would be so eligible but for a suspension of, or any limitation imposed on the amount of, his or her Elective Deferrals under the Plan. If the Plan satisfies the ADP Test Safe Harbor for any Plan Year, the Plan shall automatically be treated as satisfying the ADP test for such year, and the provisions of the Plan, and any elections made in existencethe Adoption Agreement, pertaining to the ADP test shall not apply for Such year. If the Employer has elected in the Adoption Agreement to make Safe Harbor Matching Contributions or Safe Harbor Nonelective Contributions, but fails to make such contributions, or otherwise fails to satisfy the ADP Test Safe Harbor, for any Plan Year to which such election applies (except pursuant to Section 11.05(C)(9)), the Employer must correct such failure in accordance with Revenue Procedure 2001 - 17 or the applicable successor Revenue Procedure. B. ACP Test Safe Harbor -The Plan will satisfy the ACP Test Safe Harbor for a Plan Year if the following requirements are met for such year: 1. The ManagementCo Shareholder is authorized to amend Plan satisfies the provisions ADP Test Safe Harbor for such Plan Year. 2. The Matching Contributions made under the Plan for such Plan Year satisfy at least one of the following: (a) If the matching contribution formula in this Option 1 of Section IX(a)(3) of the Adoption Agreement has been elected, (i) the Employer makes Safe Harbor Matching Contributions to the extent necessary Plan in accordance with such formula, and (ii) no other Matching Contributions are made to achieve substantially the same tax treatment Plan. (b) If the matching contribution formula in Option 2 of Section IX(a)(3) of the Adoption Agreement has been elected, (i) the Safe Harbor Matching Contributions under such formula are made only with respect to a Participant's Elective Deferrals which do not exceed 6% of his or her 401(k) Compensation, (ii) the Employer makes Safe Harbor Matching Contributions to the Plan in accordance with such formula, and (iii) no other Matching Contributions are made to the Plan. (c) Under the terms of the Plan, for such Plan Year, (i) Matching Contributions are not made with respect to any interest Participant's After-Tax Employee Contributions or Elective Deferrals which, in the Company transferred to aggregate, exceed 6% of his or her 401(k) Compensation, (ii) the rate of Matching Contributions does not increase as the rate of After-Tax Employee Contributions or Elective Deferrals increases, and (iii) at any rate of After-Tax Employee Contributions or Elective Deferrals, the rate of Matching Contributions for any Participant who is a service provider by the Company in connection with services provided to the Company as set forth in Section 4 of the Notice (e.g., to reflect changes from the rules set forth in the Notice in subsequent Internal Revenue Service guidance), provided that such amendment Highly Compensated Employee is not adverse higher than the rate of Matching Contributions for any Participant who is not a Highly Compensated Employee. If the Plan satisfies the ACP Test Safe Harbor for any Plan Year, the Plan shall automatically be treated as satisfying the ACP test as to any Shareholder (as compared with the after-tax consequences that would result if Matching Contributions for such year, and the provisions of the Notice applied to all interests Plan, and any elections made in the Company transferred to a service provider by the Company in connection with services provided Adoption Agreement, pertaining to the CompanyACP test as to Matching Contributions shall not apply for such year. If the Employer has elected in the Adoption Agreement to make Safe Harbor Matching Contributions, but fails to satisfy the ADP Test Safe Harbor for any Plan Year to which such election applies (except pursuant to Section 11.05(C)(9)), the Employer shall not be treated as having satisfied the ACP Test Safe Harbor for that Plan Year and must correct such failure in accordance with Revenue Procedure 2001 - 17 or the applicable successor Revenue Procedure. C. Special Rules - The following rules shall apply for the purpose of this Section 11.05. 1. This

Safe Harbor Rules. The ManagementCo Shareholder is authorized and directed to elect to have the “Safe Harbor” described in the proposed Revenue Procedure set forth in Internal Revenue Service Notice 2005-43 (the “Notice”) apply to any interest in the Company transferred to a service provider by the Company on or after the effective date of such Revenue Procedure in connection with services provided to the Company. Under the Safe Harbor, the value of an interest that is transferred in connection with the performance of services (a “Safe Harbor Interest”) is treated as being equal to the liquidation value of that interest. For purposes of making such Safe Harbor election, the ManagementCo Shareholder is designated as the “partner who has responsibility for federal income tax reporting” by the ManagementCo Shareholder and, accordingly, execution of such Safe Harbor election by the ManagementCo Shareholder constitutes execution of a “Safe Harbor Election” in accordance with Section 3.03(1) of the Notice. The Company and each Shareholder agree to comply with all requirements of the Safe Harbor described in the Notice, including, without limitation, the requirement that each Shareholder prepare and file all federal income tax returns (to the extent it is required to file such returns) reporting the income tax effects of each Safe Harbor Interest issued by the Company in a manner consistent with the requirements of the Notice. Each Shareholder’s obligations to comply with the requirements of this Section 12.14 shall survive the Shareholder’s ceasing to be a Shareholder of the Company and/or the winding up and/or termination of the Company, and for purposes of this Section 12.14, the Company shall be treated as continuing in existence. The ManagementCo Shareholder is authorized to amend the provisions in this Agreement to the extent necessary to achieve substantially the same tax treatment with respect to any interest in the Company transferred to a service provider by the Company in connection with services provided to the Company as set forth in Section 4 of the Notice (e.g., to reflect changes from the rules set forth in the Notice in subsequent Internal Revenue Service guidance), provided that such amendment is not adverse to any Shareholder (as compared with the after-tax consequences that would result if the provisions of the Notice applied to all interests in 66677181_14 the Company transferred to a service provider by the Company in connection with services provided to the Company).