EMPLOYEE STOCK OWNERSHIP PLAN OF FRONTIER AIRLINES, INC. EGTRRA AMENDMENT 1
AMENDMENT OF THE
EMPLOYEE STOCK OWNERSHIP PLAN OF
FRONTIER AIRLINES, INC.
FOR EGTRRA
PREAMBLE
1. Adoption and effective date of amendment. This amendment of the Employee Stock Ownership Plan
of Frontier Airlines, Inc. (the "Plan") is adopted to reflect certain provisions of the Economic Growth and Tax
Relief Reconciliation Act of 2001 ("EGTRRA") This amendment is intended as good faith compliance with the
requirements of EGTRRA and is to be construed in accordance with EGTRRA and guidance issued thereunder. Except
as otherwise provided, this amendment shall be effective as of the first day of the first plan year beginning
after December 31, 2001.
2. Supersession of inconsistent provisions. This amendment shall supersede the provisions of the
plan to the extent those provisions are inconsistent with the provisions of this amendment.
AMENDMENT
SECTION 1. LIMITATIONS ON CONTRIBUTIONS
1. Effective date. This section shall be effective for limitation years beginning after
December 31, 2001.
2. Maximum annual addition. Except to the extent permitted under section 414(v) of the Code, if
applicable, the annual addition that may be contributed or allocated to a participant's account under the plan
for any limitation year shall not exceed the lesser of:
(a) $ 40,000, as adjusted for increases in the cost-of-living under section 415(d) of the Code, or
(b) 100 percent of the participant's compensation, within the meaning of section 415(c) (3) of the
Code, for the limitation year.
The compensation limit referred to in (b) shall not apply to any contribution for medical benefits after
separation from service (within the meaning of section 401(h) or section 419A(f) (2) of the Code) which is
otherwise treated as an annual addition.
SECTION 2. INCREASE IN COMPENSATION LIMIT
The annual compensation of each participant taken into account in determining allocations for any plan
year beginning after December 31, 2001, shall not exceed $ 200,000, as adjusted for cost-of-living increases in
accordance with section 401(a) (17) (B) of the Code. Annual compensation means compensation during the plan year
or such other consecutive 12-month period over which compensation is otherwise determined under the plan (the
determination period). The cost-of-living adjustment in effect for a calendar year applies to annual
compensation for the determination period that begins with or within such calendar year.
SECTION 3. MODIFICATION OF TOP-HEAVY RULES
1. Effective date. This section shall apply for purposes of determining whether the plan is a
top-heavy plan under section 416(g) of the Code for plan years beginning after December 31, 2001, and whether the
plan satisfies the minimum benefits requirements of section 416(c) of the Code for such years. This section
amends Article XIII of the plan.
2. Determination of top-heavy status.
2.1 Key employee. Key employee means any employee or former employee (including any deceased
employee) who at any time during the plan year that includes the determination date was an officer of the
employer having annual compensation greater than $ 130,000 (as adjusted under section 416(i) (1) of the Code for
plan years beginning after December 31, 2002), a 5-percent owner of the employer, or a 1- percent owner of the
employer having annual compensation of more than $ 150,000. For this purpose, annual compensation means
compensation within the meaning of section 415(c) (3) of the Code. The determination of who is a key employee
will be made in accordance with section 416(i) (1) of the Code and the applicable regulations and other guidance
of general applicability issued thereunder.
2.2 Determination of present values and amounts. This section 2.2 shall apply for purposes of
determining the present values of accrued benefits and the amounts of account balances of employees as of the
determination date.
2.2.1 Distributions during year ending on the determination date. The present values of accrued
benefits and the amounts of account balances of an employee as of the determination date shall be increased by
the distributions made with respect to the employee under the plan and any plan aggregated with the plan under
section 416(g) (2) of the Code during the 1-year period ending on the determination date. The preceding sentence
shall also apply to distributions under a terminated plan which, had it not been terminated, would have been
aggregated with the plan under section 416(g) (2) (A) (i) of the Code. In the case of a distribution made for a
reason other than separation from service, death, or disability, this provision shall be applied by substituting
"5-year period" for "1-year period."
2.2.2 Employees not performing services during year ending on the determination date. The accrued
benefits and accounts of any individual who has not performed services for the employer during the 1-year period
ending on the determination date shall not be taken into account.
3. Minimum benefits.
3.1 Matching contributions. Employer matching contributions shall be taken into account for
purposes of satisfying the minimum contribution requirements of section 416(c) (2) of the Code and the plan. The
preceding sentence shall apply with respect to matching contributions under the plan or, if the plan provides
that the minimum contribution requirement shall be met in another plan, such other plan. Employer matching
contributions that are used to satisfy the minimum contribution requirements shall be treated as matching
contributions for purposes of the actual contribution percentage test and other requirements of section 401(m) of
the Code.
3.2 Contributions under other plans. The Employer also maintains the Frontier Airlines, Inc.
Retirement Savings Plan, a defined contribution profit sharing plan with a cash or deferred arrangement (the
"401(k) Plan"). A Participant who participates both in this plan and the 401(k) Plan shall receive the minimum
contribution in this plan.
SECTION 4. DIRECT ROLLOVERS OF PLAN DISTRIBUTIONS
1. Effective date. This section shall apply to distributions made after December 31, 2001.
2. Modification of definition of eligible retirement plan. For purposes of the direct rollover
provisions in section 6.5(f) of the plan, an eligible retirement plan shall also mean an annuity contract
described in section 403(b) of the Code and an eligible plan under 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 which agrees to separately account for amounts transferred into such plan from this
plan. The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving
spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as
defined in section 414(p) of the Code.
3. Modification of definition of eligible rollover distribution to exclude hardship
distributions. For purposes of the direct rollover provisions in section 6.5(f) of the plan, any amount that is
distributed on account of hardship shall not be an eligible rollover distribution and the distributee may not
elect to have any portion of such a distribution paid directly to an eligible retirement plan.
4. Modification of definition of eligible rollover distribution to include after-tax employee
contributions. For purposes of the direct rollover provisions in section 6.5(f) of the plan, a portion of a
distribution shall not fail to be an eligible rollover distribution merely because the portion consists of
after-tax employee contributions which are not includible in gross income. However, such portion may be
transferred only to an individual retirement account or annuity described in section 408(a) or (b) of the Code,
or to a qualified defined contribution plan described in section 401(a) or 403(a) of the Code that agrees to
separately account for amounts so transferred, including separately accounting for the portion of such
distribution which is includible in gross income and the portion of such distribution which is not so includible.
FRONTIER AIRLINES, INC.
Date:______________________, 2001 By:_________________________________
