SIXTH AMENDMENT TO
THE ALLIANCE DATA SYSTEMS 401(K) AND RETIREMENT SAVINGS PLAN
(amended and restated as of January 1, 2001)
ADS Alliance Data Systems, Inc. hereby adopts this Amendment No. 6 to the Alliance Data Systems 401(k) and Retirement Savings Plan (the "Plan"), effective as of January 1, 2004, except as otherwise provided.
Senior Associate. A Participant who has completed either 180 days of uninterrupted service with an Employer or a Year of Eligibility Service, whichever first occurs, as of an Entry Date.
2.2 Participation Requirement(s)
Subject to Section 2.3, an Employee who has attained age 21 may become a Participant on any Entry Date that coincides with or follows his or her Employment Commencement Date, provided, however, that any Employee who is classified as a "seasonal" or "on-call" Employee on the Employer's payroll system must complete a Year of Eligibility Service and attain age 21 to become a Participant.
(A) He performs services for an Employer solely as a "Leased Employee," is employed on a temporary basis,
3.6 Deferral Percentage Limitation
Subject to the special rules of Section 3.7, and at such intervals as it shall deem proper, the Benefits Administration Committee shall review the Deposit election of each Participant who has not attained age 21 and completed a Year of Eligibility Service in order to ensure that the Tax Deferred Deposits with respect to such Participants satisfy one of the following tests:
ARTICLE 4
EMPLOYER CONTRIBUTIONS
4.1. Employer Matching Contributions
Section 4.1 for any pay period in which the Participant did not make a Tax Deferred Deposit, a catch-up contribution, or a Taxed Deposit.
4.2. Percentage Limitation on Taxed Deposits
At such intervals as it shall deem proper, the Benefits Administration Committee shall review the Taxed Deposits and, in the case of a Participant who has not completed a Year of Eligibility Service, the Employer Matching Contributions made for Participants in order to ensure that such contributions satisfy one of the following tests:
4.3 Special Rules for Contribution Percentage Limit Testing
4.4. Adjustments to Excess Aggregate Contributions
Taxed Deposits as of the beginning of the Plan Year plus (2) the Participant's Taxed Deposits for the Plan Year.
Notwithstanding the foregoing, no gain or loss shall be allocated to Excess Aggregate Contributions for the period between the end of the taxable year and the date of the corrective distribution.
4.5. Retirement Contributions
TABLE A
ALLOCABLE POINTS
| Participant's Age | Allocable Points | Participant's Years of Vesting Service | Allocable Points | |||
|---|---|---|---|---|---|---|
| 40-44 | 1 | 0-9 | 1 | |||
| 45-49 | 2 | 10-14 | 2 | |||
| 50-54 | 3 | 15-19 | 3 | |||
| 55-59 | 4 | 20-24 | 4 | |||
| 60 and up | 5 | 25-29 | 5 | |||
| 30-34 | 6 | |||||
| 35 and up | 7 |
For purposes of Table A, "Age" is the Participant's age at last birthday on the applicable Allocation Date. Further, for purposes of Table A, a Participant's Years of Vesting Service will be equal to his full Years of Vesting Service completed as of the applicable Allocation Date.
"Allocation Date" means December 31, 2003 and, for the allocation provided under Subsection (E), December 31, 2004.
4.6. Overall Limitation on Annual Additions
Any other provision of this Plan notwithstanding, in no event shall the Annual Addition allocated to a Participant's Account under the Plan for any Limitation Year, exceed the lesser of:
(1) Any contribution for medical benefits (within the meaning of Section 419A(f)(2) of the Code) after separation from service which is otherwise treated as an Annual Addition; or
(2) Any amount otherwise treated as an Annual Addition under Section 415(l)(1) of the Code.
If, as a result of the allocation of forfeitures, a reasonable error in estimating a Participant's annual Compensation, a reasonable error in determining the amount of Tax Deferred Deposits that may be made with respect to any individual under the limits of Code Section 415, or under other limited facts and circumstances that the Commissioner finds justifies this method of allocation, the Annual Addition for a particular Participant would cause the limitations of Code Section 415 applicable to that Participant for the Limitation Year to be exceeded, the excess amounts shall not be deemed an Annual Addition in that Limitation Year and for contributions other than Tax Deferred Deposits and/or Taxed Deposits, such contributions shall be withheld or taken from a Participant's Account and held in a suspense account to be used to reduce future contributions for the Participant (or, if the Participant ceases to be an Employee, for remaining active Participants) in succeeding Limitation Years, as necessary, and, for Tax Deferred Deposits and/or Taxed Deposits, such Deposits (together with allocable income) shall be distributed to the Participant.
4.7. Special Rules
The limitation of Section 4.6 with respect to any Participant who at any time has participated in any other qualified defined contribution plan maintained by the Employer shall apply as if the total contributions allocated under all such defined
contribution plans in which the Participant has participated were allocated under one plan.
4.8. Definitions
For purposes of Section 4.6, the following definitions shall apply:
(1) Tax Deferred Deposits,
(2) Taxed Deposits,
(3) Employer Matching Contributions,
(4) Retirement Contributions,
(5) Discretionary Profit Sharing Contributions,
(6) forfeitures (if any), and
(7) amounts described in Section 415(l)(1) and 419A(d)(2) of the Code.
4.9. Timing of Employer Contributions
The Employer shall forward Employer Matching Contributions made pursuant to Section 4.1(A), Retirement Contributions made pursuant to Section 4.5, and Discretionary Profit Sharing Contributions made pursuant to Section 4.10 to the Trustee for investment in the Trust Fund at such times as the Employer shall determine, but not later than the time prescribed by law, including extensions, for filing the income tax return of the Employer for the Employer's taxable year for which such contributions are deductible.
4.10. Discretionary Profit Sharing Contributions
The Board of Directors may, in its sole discretion, authorize a supplemental contribution to be made by each Employer on behalf of its Employees who are eligible to share in such contribution, as hereinafter provided. The Contribution shall be referred to as a Discretionary Profit Sharing Contribution and shall be allocated to each Participant who has not Separated from Service on or before the last day of the Plan Year with respect to which the Discretionary Profit Sharing Contribution is declared or who had Separated from Service in such Plan Year by reason of death, Total and Permanent Disability or retirement on or after Normal Retirement Age. The Board of Directors shall normally determine the amount of the Discretionary Profit Sharing Contribution, if any, after it has reviewed the Company's financial performance for the Plan Year; and Participants shall be informed of the amount of the contribution soon thereafter. The Discretionary Profit Sharing Contribution shall be a specified percentage of Participant's Compensation, may be integrated with Social Security to the extent permitted under 401(l), and shall satisfy all applicable requirements of the Code.
8.2. Vesting in Company Account
Employer Matching Contributions made with respect to periods after January 1, 2004, shall be nonforfeitable. Subject to Section 8.3, a Participant shall have a vested and nonforfeitable right in his Company Account attributable to Employer Matching Contributions made with respect to periods prior to January 1, 2004, and any earnings or losses attributable thereto, in accordance with the following schedule:
| Years of Vesting Service | Percentage Vested | ||
|---|---|---|---|
| Less than 1 | 0 | % | |
| 1 but less than 2 | 20 | % | |
| 2 but less than 3 | 40 | % | |
| 3 but less than 4 | 60 | % | |
| 4 but less than 5 | 80 | % | |
| 5 or more | 100 | % |
A Participant whose employment is terminated prior to attainment of his Normal Retirement Age (and for any reason other than death or Total and Permanent Disability), shall have a vested and nonforfeitable right in his Company Account attributable to Retirement Contributions and Discretionary Profit Sharing Contributions, and any earnings or losses attributable thereto, in accordance with the following schedule:
| Years of Vesting Service | Percentage Vested | ||
|---|---|---|---|
| Less than 5 | 0 | % | |
| 5 or more | 100 | % |
Notwithstanding the foregoing, a Participant who participated in the World Financial Network Plan and whose Retirement Account under such plan was transferred to this Plan shall have a nonforfeitable interest in his World Financial Network Plan Retirement Account determined in accordance with the following schedule if it would result in a larger nonforfeitable interest than under the foregoing schedule:
| Years of Vesting Service | Percentage Vested | ||
|---|---|---|---|
| Less than 3 | 0 | % | |
| 3 | 20 | % | |
| 4 | 40 | % | |
| 5 | 100 | % |
Any amount remaining in a Participant's Company Account after his nonforfeitable percentage is determined upon his Separation from Service shall be forfeited by him as provided in Section 8.5. The forfeited amounts shall be held in the Forfeiture Account subject to Section 8.8.
A withdrawal hereunder shall be made from sources in the Account in the order determined by the Benefits Administration Committee.
Such withdrawal may be made from any vested portion in the Participant's Account, other than (1) earnings on Tax Deposits and (2) Employer Matching Contributions made with respect to periods after January 1, 2004 and in the order determined by the Benefits Administration Committee.
The Benefits Administration Committee may, in its discretion, establish a program under the Plan to provide loans to Participants (the "Loan Program"). If so established, the Loan Program shall be embodied in a separate written document that is incorporated by reference into the Plan. The Loan Program shall be administered in a uniform and discretionary manner with respect to all similarly situated Participants.
IN WITNESS WHEREOF, this amendment has been executed on this 12th day of December, 2003, but effective as provided above.
| ADS ALLIANCE DATA SYSTEMS, INC. | ||||
By: | /s/ DWAYNE H. TUCKER | |||
